Under CWA Section 401, a federal agency may not issue a license or permit to conduct any activity that may result in a discharge into a “water of the United States” unless the certifying authority where the discharge would originate either issues a CWA Section 401 water quality certification that the discharge will comply with the applicable provisions of the CWA, or waives certification. The certifying authority could be a state, a territory, an authorized tribe, or the EPA, depending on where the discharge originates. Federal licenses and permits that may require Section 401 certification include CWA Section 404 dredge and fill permits, Rivers and Harbors Act Sections 9 and 10 permits issued by the Army Corps of Engineers, CWA Section 402 pollutant discharge permits issued by the EPA, and hydropower and interstate natural gas pipeline licenses issued by the Federal Energy Regulatory Commission.
To initiate the certification process, federal license or permit applicants must submit a “request for certification” to the appropriate certifying authority. The certifying authority must act on the request within a “reasonable period of time (which shall not exceed one year).” During the reasonable period of time, certifying authorities must provide public notice of a certification request, and hold a public hearing where appropriate.
If a certifying authority determines a discharge will comply with the applicable CWA provisions, it may grant or waive certification. When granting a Section 401 certification, certifying authorities must include conditions necessary to assure that the applicant for the federal license or permit will comply with applicable provisions of the CWA and with “any other appropriate requirement of state law.” If a certifying authority grants certification with conditions, that certification will become a condition on the federal license or permit. Once an applicant provides a federal agency with a certification, the federal agency may issue the license or permit.
If a certifying authority is unable to provide such certification, the certifying authority may deny or waive certification. If certification is denied, the federal agency cannot issue the federal license or permit. If certification is waived, the federal agency may issue the federal license or permit. Certifying authorities may waive certification expressly or by failing or refusing to act on a request for certification within a reasonable period of time.
Key Provisions of the Proposed Rule
A. Pre-Filing Meeting Requests
The Proposed Rule contains a requirement for a project proponent to request a pre-filing meeting with the certifying authority at least 30 days before submitting a certification request. The pre-filing meeting request, which is not a requirement under the CWA and which extends the timeline for Section 401 certification, was introduced in the 2020 Rule to encourage early coordination between parties before the start of the reasonable period of time. Whereas the 2020 Rule does not provide any mechanism for certifying authorities to waive or alter the 30-day waiting period, the Proposed Rule grants certifying authorities discretion to waive the pre-filing meeting request requirement or shorten the 30-day timeline. The EPA is seeking comment on the proposed approach, including the 30-day timeline between the submission of a pre-filing meeting request and a certification request, whether the project proponent should have the opportunity to participate in determining the need for a pre-filing meeting request, and whether the EPA should include a pre-filing meeting request requirement at all.
B. Reasonable Period of Time
As discussed above, when a certifying authority receives a request for certification, the certifying authority must act on that request within a “reasonable period of time (which shall not exceed one year)” or it waives its ability to certify the federal license or permit. The Proposed Rule provides federal agencies and certifying authorities with the ability to jointly set the reasonable period of time, provided the reasonable period of time does not exceed one year from the receipt of the request for certification. If the federal agency and certifying authority do not agree on a reasonable period of time within 30 days after a certifying authority receives a request for certification, the default reasonable period of time will be 60 days from the receipt of the request for certification. The 2020 Rule does not contain the 60-day default, which would help expedite projects when the federal agency and certifying authority fail to agree on a reasonable period of time and would increase certainty for project timelines. The EPA is requesting comment on the 60-day default and 30-day timeframe that the federal agency and certifying authority would have to determine the reasonable period of time.
C. Extensions to the Reasonable Period of Time
The Proposed Rule allows certifying authorities and federal agencies to jointly extend the reasonable period of time, as long as the project proponent is consulted and the extension does not exceed one year from the receipt of the request for certification. Project proponents would be consulted before any changes to the reasonable period of time, but they would not have the ability to veto final reasonable period of time decisions. The 2020 Rule explicitly allows certifying authorities to request an extension of the reasonable period of time, which necessarily delays the timeline of a project’s Section 401 certification. The EPA is seeking comment on alternative approaches, such as not requiring the project proponent to be consulted before an extension decision or disallowing extensions of the reasonable period of time after the agreed to or default reasonable period of time has been established.
D. Withdrawal and Resubmissions of Requests for Certification
The EPA acknowledges in the Proposed Rule that certifying authorities historically asked project proponents to withdraw and resubmit their certification requests to restart the clock and provide more time to complete certification review. The 2020 Rule prohibits the certifying authority from asking the project proponent to withdraw the certification request to reset the reasonable period of time. The Proposed Rule would remove this prohibition and leave the courts and the certifying authorities to make case-specific decisions or issue their own regulations relating to this practice—a process that would increase uncertainty for project proponents and could slow certification processes. The EPA is seeking comment on this approach as well as any alternative approaches, such as the EPA establishing regulations authorizing withdrawals and resubmissions for certain situations.
E. Scope of Certification
The Proposed Rule provides that, when reviewing a request for certification, a certifying authority must consider whether the federally licensed or permitted “activity as a whole” will comply with water quality requirements. This approach provides certifying authorities with the ability to consider any aspect of the federally licensed or permitted activity that may adversely impact water quality. The Proposed Rule differs from the 2020 Rule, under which the certifying authority can only consider potential water quality impacts from the project’s point source “discharges,” and therefore is significantly narrower in scope. The EPA is requesting comment on whether to adopt the “activity as a whole” or “discharge-only” scope of review.
The Proposed Rule contains a process that allows certifying authorities to modify a certification after reaching agreement with the federal licensing or permitting agency. As used in the Proposed Rule, a modification means a change to an element or portion of a certification or its conditions; it does not mean the complete reversal of a certification decision. The EPA is seeking comment on this approach, and on whether there should be a temporal limitation on certification modifications in the interest of finality and reliance.
Public Comment Period
The public comment period is open until August 8, 2022. Entities that might be impacted by the Proposed Rule should carefully review it and consider submitting comments to further their interests before the comment period closes.
This article summarizes aspects of the law and does not constitute legal advice. For legal advice for your situation, you should contact an attorney.