[Federal Register Volume 88, Number 186 (Wednesday, September 27, 2023)]
[Rules and Regulations]
[Pages 66558-66666]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2023-20219]
[[Page 66557]]
Vol. 88
Wednesday,
No. 186
September 27, 2023
Part II
Environmental Protection Agency
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40 CFR Parts 121, 122, and 124
Clean Water Act Section 401 Water Quality Certification Improvement
Rule; Final Rule
Federal Register / Vol. 88 , No. 186 / Wednesday, September 27, 2023
/ Rules and Regulations
[[Page 66558]]
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ENVIRONMENTAL PROTECTION AGENCY
40 CFR Parts 121, 122, and 124
[EPA-HQ-OW-2022-0128; FRL-6976.1-03-OW]
RIN 2040-AG12
Clean Water Act Section 401 Water Quality Certification
Improvement Rule
AGENCY: Environmental Protection Agency (EPA).
ACTION: Final rule.
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SUMMARY: Following careful reconsideration of the water quality
certification rule the U.S. Environmental Protection Agency (EPA or the
Agency) promulgated in 2020, the Agency is finalizing a rule revising
and replacing the 2020 regulatory requirements for water quality
certification under Clean Water Act (CWA) section 401. This final rule
updates the existing regulations to better align with the statutory
text and purpose of the CWA; to clarify, reinforce, and provide a
measure of consistency with elements of section 401 certification
practice that have evolved over the more than 50 years since EPA first
promulgated water quality certification regulations; and to support an
efficient and predictable certification process that is consistent with
the water quality protection and cooperative federalism principles
central to CWA section 401. An Executive order signed on January 20,
2021, entitled ``Protecting Public Health and the Environment and
Restoring Science to Tackle the Climate Crisis,'' directed the Agency
to review the water quality certification rule EPA promulgated in 2020,
and this final rule culminates that review. The Agency is also
finalizing conforming amendments to the water quality certification
regulations for EPA-issued National Pollutant Discharge Elimination
System (NPDES) permits.
DATES: This action is effective on November 27, 2023.
ADDRESSES: The EPA has established a docket for this action under
Docket ID No. EPA-HQ-OW-2022-0128. All documents in the docket are
listed on the https://www.regulations.gov/ website. Although listed in
the index, some information is not publicly available, e.g.,
confidential business information (CBI) or other information whose
disclosure is restricted by statute. Certain other material, such as
copyrighted material, is not placed on the internet and will be
publicly available in hard copy form. Publicly available docket
materials are available electronically through https://www.regulations.gov.
FOR FURTHER INFORMATION CONTACT: Lauren Kasparek, Oceans, Wetlands, and
Communities Division, Office of Water (4504-T), Environmental
Protection Agency, 1200 Pennsylvania Avenue NW, Washington, DC 20460;
telephone number: 202-564-3351; email address: [email protected].
SUPPLEMENTARY INFORMATION:
Table of Contents
I. Executive Summary
II. General Information
A. What action is the Agency taking?
B. What is the Agency's authority for taking this action?
C. What are the incremental costs and benefits of this action?
III. Background
A. Development of Section 401
B. Overview of Section 401 Requirements
C. Prior Rulemaking Efforts Addressing Section 401
D. Summary of Stakeholder Outreach
IV. Final Rule
A. When Section 401 Certification Is Required
B. Pre-Filing Meeting Request
C. Request for Certification
D. Reasonable Period of Time
E. Scope of Certification
F. Certification Decisions
G. Federal Agency Review
H. EPA's Roles Under Section 401
I. Modifications
J. Enforcement and Inspections
K. Neighboring Jurisdictions
L. Treatment in a Similar Manner as a State Under Section 401
M. Implementation Considerations
N. Severability
V. Economic Analysis
VI. Statutory and Executive Order Reviews
A. Executive Order 12866: Regulatory Planning and Review and
Executive Order 14094: Modernizing Regulatory Review
B. Paperwork Reduction Act (PRA)
C. Regulatory Flexibility Act (RFA)
D. Unfunded Mandates Reform Act (UMRA)
E. Executive Order 13132: Federalism
F. Executive Order 13175: Consultation and Coordination With
Indian Tribal Governments
G. Executive Order 13045: Protection of Children From
Environmental Health and Safety Risks
H. Executive Order 13211: Actions Concerning Regulations That
Significantly Affect Energy Supply, Distribution, or Use
I. National Technology Transfer and Advancement Act
J. Executive Order 12898: Federal Actions To Address
Environmental Justice in Minority Populations and Low-Income
Populations and Executive Order 14096: Revitalizing Our Nation's
Commitment to Environmental Justice for All
K. Congressional Review Act
I. Executive Summary
Clean Water Act (CWA) section 401 provides states \1\ and
authorized Tribes \2\ with a powerful tool to protect the quality of
their waters from adverse impacts resulting from the construction and/
or operation of federally licensed or permitted projects. Under CWA
section 401, a Federal agency may not issue a license or permit to
conduct any activity that may result in any discharge into ``waters of
the United States'' \3\ unless the state or authorized Tribe where the
discharge would originate either issues a CWA section 401 water quality
certification ``that any such discharge will comply with the applicable
provisions of Sections 301, 302, 303, 306, and 307'' of the CWA, or
waives certification. 33 U.S.C. 1341(a)(1). When granting a CWA section
401 certification, CWA section 401(d) directs states and authorized
Tribes to include conditions, including ``effluent limitations and
other limitations, and monitoring requirements,'' necessary to assure
that the applicant for a Federal license or permit will comply with CWA
sections 301, 302, 306, and 307, and with ``any other appropriate
requirement of State law.'' Id. at 1341(d).
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\1\ The CWA defines ``state'' as ``a State, the District of
Columbia, the Commonwealth of Puerto Rico, the Virgin Islands, Guam,
American Samoa, the Commonwealth of the Northern Mariana Islands,
and the Trust Territory of the Pacific Islands.'' 33 U.S.C. 1362(3).
\2\ The term ``authorized Tribes'' refers to Tribes that have
been approved for ``treatment in a manner similar to a State''
status for CWA section 401. See 33 U.S.C. 1377(e).
\3\ The CWA, including section 401, uses the term ``navigable
waters,'' which the statute defines as ``the waters of the United
States, including the territorial seas.'' 33 U.S.C. 1362(7). This
final rule uses the term ``waters of the United States''
interchangeably with ``navigable waters''.
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Congress originally created the water quality certification
requirement in section 21(b) of the Water Quality Improvement Act of
1970, which amended the Federal Water Pollution Control Act (FWPCA).\4\
Congress granted states this certification authority in response to
Federal agencies' failure to achieve Congress's previously stated goal
of assuring that federally licensed or permitted activities comply with
water quality standards.\5\ Two years
[[Page 66559]]
later, Congress revised the Federal water quality protection framework
\6\ when it enacted the Federal Water Pollution Control Act Amendments
of 1972 (commonly known as the Clean Water Act or CWA).\7\ In those
Amendments, Congress placed the water quality certification requirement
in section 401, using ``substantially section 21(b) of existing law,''
with relevant conforming amendments ``to assure consistency with the [
] changed emphasis from water quality standards to effluent limitations
based on the elimination of any discharge of pollutants.'' S. Rep. No.
92-414 at 69 (1971); see also H.R. Rep. No. 92-911 at 121 (1972)
(``Section 401 is substantially section 21(b) of the existing law
amended to assure that it conforms and is consistent with the new
requirements of the Federal Water Pollution Control Act.''). Consistent
with the overall cooperative federalism framework of the CWA, section
401 authorizes states and authorized Tribes to play a significant role
in the Federal licensing or permitting process.
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\4\ Water Quality Improvement Act of 1970, Public Law 91-224, 84
Stat. 91 (April 3, 1970).
\5\ S. Rep. 91-351, at 26 (1969) (``Existing law declares it to
be the intent of Congress that all Federal departments, agencies,
and instrumentalities shall comply with water quality standards.
This declaration of intent has proved unsatisfactory. One basic
thrust of S. 7 is to require that all activity over which the
Federal Government has direct control--. . . federally licensed or
permitted activity--be carried out in a manner to assure compliance
with applicable water quality standards.'')
\6\ City of Milwaukee v. Illinois, 451 U.S. 304, 310, 317
(1981).
\7\ Public Law 92-500, 86 Stat. 816, as amended, Public Law 95-
217, 91 Stat. 1566, 33 U.S.C. 1251 et seq.
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EPA promulgated implementing regulations for water quality
certification in 1971 (1971 Rule) \8\ prior to enactment of the 1972
amendments to the CWA. In 1979, the Agency recognized the need to
update its water quality certification regulations, in part to be
consistent with the 1972 amendments. See 44 FR 32854, 32856 (June 7,
1979) (noting the 40 CFR part 121 regulations predated the 1972
amendments). However, the Agency declined to update the regulations at
the time because it had not consulted with other Federal agencies
impacted by the water quality certification process, and instead
developed regulations applicable to water quality certifications on
EPA-issued National Pollutant Discharge Elimination System (NPDES)
permits. Id.; see, e.g., 40 CFR 124.53 through 124.55. As a result, for
a number of years, the 1971 Rule did not fully reflect the amended
statutory language. Following the promulgation of the 1971 Rule,
several seminal court cases have addressed fundamental aspects of the
water quality certification process, including the scope of
certification review and the appropriate timeframe for certification
decisions. States have also developed and implemented their own water
quality certification programs and practices aimed at protecting waters
within their borders. During this time, the Agency supported state and
Tribal water quality certification practices and the critical role
states and Tribes play in protecting their waters under section 401.\9\
But the 1971 Rule did not reflect or account for water quality
certification practices or judicial interpretations of section 401 that
evolved over the 50 years since 1971.
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\8\ 36 FR 8563 (May 8, 1971), redesignated at 36 FR 22369, 22487
(November 25, 1971), further redesignated at 37 FR 21441 (October
11, 1972), further redesignated at 44 FR 32854, 32899 (June 7,
1979).
\9\ See Wetlands and 401 Certification: Opportunities and
Guidelines for States and Eligible Indian Tribes (April 1989)
(hereinafter, 1989 Guidance); Clean Water Act Section 401 Water
Quality Certification: A Water Quality Protection Tool for States
and Tribes (May 2010) (hereinafter, 2010 Handbook) (rescinded in
2019, see infra).
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EPA revised the 1971 Rule in 2020.\10\ The 2020 Rule did not update
the regulations applicable to water quality certifications on EPA-
issued NPDES permits but noted that the Agency would ``make any
necessary conforming regulatory changes in a subsequent rulemaking.''
85 FR 42219 (July 13, 2020). The 2020 Rule represented a substantive
departure from some of the Agency's and certifying authorities' core
prior interpretations and practices with respect to water quality
certification. The 2020 Rule also deviated sharply from the cooperative
federalism framework central to section 401 and the CWA. While the 2020
Rule reaffirmed some of the Agency's and the courts' prior
interpretations, e.g., the need for a potential point source discharge
into waters of the United States to trigger the section 401 water
quality certification requirement, it rejected nearly 50 years of
Agency practice and over 25 years of Supreme Court precedent regarding
the appropriate scope of certification review, i.e., rejecting
``activity as a whole'' for the narrower ``discharge-only'' approach.
Additionally, the 2020 Rule introduced new procedural requirements that
disrupted state and Tribal certification programs that evolved over the
last half century. In this final rule, the Agency is returning to those
important core interpretations and practices, such as an ``activity''
approach to the scope of certification review and greater deference to
the role of states and Tribes in the certification process, while
retaining (and adding) elements that provide transparency and
predictability for all stakeholders.
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\10\ Clean Water Act Section 401 Certification Rule, 85 FR 42210
(July 13, 2020) (hereinafter, 2020 Rule). For further discussion on
the 2020 Rule, including legal challenges, please see section III of
this preamble.
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On January 20, 2021, President Biden signed Executive Order 13990
directing Federal agencies to review actions taken in the prior four
years that are, or may be, inconsistent with the policies stated in the
order (including, but not limited to, bolstering resilience to climate
change impacts and prioritizing environmental justice).\11\ Protecting
Public Health and the Environment and Restoring Science to Tackle the
Climate Crisis, Executive Order 13990, 86 FR 7037 (published January
25, 2021, signed January 20, 2021). Pursuant to this Executive order,
EPA reviewed the 2020 Rule. EPA identified substantial concerns with
several of its provisions that were in tension with section 401's
cooperative federalism approach to ensuring that states and Tribes are
empowered to protect their water quality. See Notice of Intention to
Reconsider and Revise the Clean Water Act Section 401 Certification
Rule, 86 FR 29541, 29542 (June 2, 2021) (identifying the Agency's
concerns with the 2020 Rule). As a result, the Agency announced its
intention to revise the 2020 Rule so that it is (1) well-informed by
stakeholder input, (2) better aligned with the cooperative federalism
principles that have been central to the effective implementation of
the CWA, and (3) responsive to the environmental protection and other
objectives outlined in Executive Order 13990. Id.
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\11\ EPA has defined environmental justice as the ``fair
treatment and meaningful involvement of all people regardless of
race, color, national origin, or income with respect to the
development, implementation and enforcement of environmental laws,
regulations and policies.'' See https://www.epa.gov/environmentaljustice/learn-about-environmental-justice.
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Five months after EPA's announcement of its intent to reconsider
and revise the 2020 Rule, on October 21, 2021, in a legal challenge to
the 2020 Rule, a Federal district court remanded and vacated the 2020
Rule. In Re Clean Water Act Rulemaking, 568 F. Supp. 3d 1013 (N.D. Cal.
2021). While EPA had not asked the court to vacate the 2020 Rule,\12\
the court found that vacatur was appropriate ``in light of the lack of
reasoned decision-making and apparent errors in the rule's scope of
certification, indications that the rule contravenes the structure and
purpose of the Clean Water Act, and that EPA itself has signaled that
it could not or would not adopt the same rule upon remand.'' Id. at
1026-27. The effect of the court's vacatur was to reinstate the 1971
Rule, effective October 21, 2021. Defendant-intervenors appealed the
vacatur order to the U.S. Court of Appeals for the Ninth Circuit. On
April 6, 2022, the U.S. Supreme Court granted the defendant-
[[Page 66560]]
intervenors' application for a stay of the vacatur pending the Ninth
Circuit appeal. Louisiana v. Am. Rivers, 142 S. Ct. 1347 (2022).\13\ As
a result of the Supreme Court's stay, the 2020 Rule once again applied
to section 401 certifications. On February 21, 2023, the U.S. Court of
Appeals for the Ninth Circuit reversed the district court's remand with
vacatur order and remanded the case back to the U.S. District Court for
the Northern District of California for further proceedings.\14\ As a
result of the Ninth Circuit's decision, the 2020 Rule applies until
this final rule goes into effect.
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\12\ See EPA's Motion for Remand Without Vacatur, No. 3:20-cv-
04636-WHA (N.D. Cal. July 1, 2021).
\13\ The Court's stay order does not alter EPA's legal
conclusions discussed in this final rule. The request for a stay
concerned only the appropriateness of the district court's vacatur
of a rule before a decision on the merits. The stay request did not
raise any issues related to the substance of CWA section 401
certification or the merits of the 2020 Rule. See Application for
Stay Pending Appeal in Louisiana v. Am. Rivers, No. 21A539, pp. 1,
4, 16 (March 21, 2022) (identifying ``the core issue in this case''
to be the appropriateness of the district court's vacatur order)
(identifying the Administrative Procedure Act (APA)--not the CWA or
section 401--as the statutory provision involved in the application
for stay) (starting the application for stay with the question:
``Can a single district court vacate a rule that an agency adopted
through notice-and-comment rulemaking without first finding that the
rule is unlawful?''). Neither the Court's majority--which did not
issue an opinion explaining its stay order--nor the dissent
discussed any aspect of section 401 certification or the 2020 Rule.
\14\ The court found that ``the district court lacked the
authority to vacate the 2020 Rule without first holding it
unlawful.'' In Re Clean Water Act Rulemaking, 60 F.4th 583, 596 (9th
Cir. 2023). The court did not address the merits of the 2020 Rule,
noting that it could not ``engage in the factfinding that might be
needed to identify any harms that keeping the 2020 Rule in place
during a remand might cause. . . .'' Id.
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The Agency is finalizing revisions to the 2020 Rule to better
reflect the cooperative federalism framework and text of the 1972 and
1977 statutory amendments. The final rule also clarifies issues such as
scope of certification and the reasonable period of time for a
certifying authority to act. The final rule modifies the regulatory
text implementing section 401 to support a more efficient, effective,
and predictable certifying authority-driven certification process
consistent with the water quality protection and other policy goals of
CWA section 401 and Executive Order 13990. The Agency is also
finalizing conforming amendments to the water quality certification
regulations for EPA-issued NPDES permits.
II. General Information
A. What action is the Agency taking?
In this action, the Agency is publishing a final rule to replace
its currently effective water quality certification regulations at 40
CFR part 121 and to make conforming edits in 40 CFR parts 122 and 124.
B. What is the Agency's authority for taking this action?
The authority for this action is the Federal Water Pollution
Control Act, 33 U.S.C. 1251 et seq., including but not limited to
sections 101(d), 304(h), 401, 402, and 501(a).
C. What are the incremental costs and benefits of this action?
The Agency prepared the Economic Analysis for the Final ``Clean
Water Act Section 401 Water Quality Certification Improvement Rule''
(``Economic Analysis for the Final Rule''), which evaluates the
potential costs and benefits and is available in the rulemaking docket.
The analysis is summarized in section V in this preamble. The Economic
Analysis for the Final Rule is qualitative due to significant
limitations and uncertainties associated with estimating the
incremental costs and benefits of the final rule. See section V of this
preamble for further discussion.
III. Background
A. Development of Section 401
In 1965, Congress amended the Federal Water Pollution Control Act
(FWPCA) to require states, or, where a state failed to act, the newly
created Federal Water Pollution Control Administration, to promulgate
water quality standards for interstate waters within each state. Water
Quality Act of 1965, Public Law 89-234, 79 Stat. 903 (October 2, 1965).
These standards were meant ``to protect the public health or welfare,
enhance the quality of water and serve the purposes of [the] Act,''
which included ``enhanc[ing] the quality and value of our water
resources and [] establish[ing] a national policy for the prevention,
control, and abatement of water pollution.'' Id. Yet, only a few years
later, while debating potential amendments to the FWPCA, Congress
observed that, despite that laudable national policy, states faced
obstacles to achieving these newly developed water quality standards
because of an unexpected source: Federal agencies. Instead of helping
states cooperatively achieve these Federal policy objectives, Federal
agencies were ``sometimes . . . a culprit with considerable
responsibility for the pollution problem which is present.'' 115 Cong.
Rec. 9011, 9030 (April 15, 1969). Federal agencies were issuing
licenses and permits ``without any assurance that [water quality]
standards [would] be met or even considered.'' S. Rep. No. 91-351, at 3
(August 7, 1969). As a result, states, industry groups, conservation
groups, and the public alike ``questioned the justification for
requiring compliance with water quality standards'' if Federal agencies
themselves would not comply with those standards. Id. at 7.
In response to such concerns, Congress introduced language that
would bolster state authority to protect their waters and ensure
federally licensed or permitted projects would not ``in fact become a
source of pollution'' either through ``inadequate planning or
otherwise.'' 115 Cong. Rec. 9011, 9030 (April 15, 1969). Under this new
provision, instead of relying on the Federal Government to ensure
compliance with water quality standards, states would be granted the
power to certify that there was reasonable assurance that federally
licensed or permitted activities would meet water quality standards
before such a Federal license or permit could be issued. Ultimately,
Congress added this new provision as section 21(b) of the Water Quality
Improvement Act of 1970, Public Law 91-224, 84 Stat. 91 (April 3,
1970).
Under section 21(b)(1), applicants for Federal licenses or permits
were required to obtain state certification that there was reasonable
assurance that any federally licensed or permitted activity that may
result in any discharge into navigable waters would not violate
applicable water quality standards. Id. Additionally, section 21(b)
also provided a role for other potentially affected states, discussed
scenarios under which state certification for both Federal construction
and operation licenses or permits may be necessary, and provided an
opportunity for a Federal license or permit to be suspended for
violating applicable water quality standards. Section 21(b) embodied
the cooperative federalism principles from the 1965 amendments by
providing states with the opportunity to influence, yet not
``frustrate,'' the Federal licensing or permitting process. See 115
Cong. Rec. 28875, 28971 (October 7, 1969) (noting the idea of state
certification ``[arose] out of policy of the 1965 Act that the primary
responsibility for controlling water pollution rests with the
States''); see also H.R. Rep. No. 91-940, at 54-55 (March 24, 1970)
(Conf. Rep) (adding a timeline for state certification ``[i]n order to
insure that sheer inactivity by the State . . . will not frustrate the
Federal application'').
In 1972, with the enactment of the Clean Water Act, Congress
significantly
[[Page 66561]]
revised the statutory water quality protection framework.\15\ Clean
Water Act, Public Law 92-500, 86 Stat. 816, as amended, Public Law 95-
217, 91 Stat. 1566, 33 U.S.C. 1251 et seq. While doing so, Congress
reaffirmed ``the primary responsibilities and rights of States to
prevent, reduce, and eliminate pollution.'' \16\ To this end, the 1972
amendments included section 401, which Congress considered to be
``substantially section 21(b) of the existing law amended to assure
that it conforms and is consistent with the new requirements of the
Federal Water Pollution Control Act.'' H.R. Rep. No. 92-911, at 121
(1972). These ``new requirements'' of the 1972 Act reflected a
``changed emphasis from water quality standards to effluent limitations
based on the elimination of any discharge of pollutants.'' S. Rep. No.
92-414, at 69 (1971). As a result, unlike section 21(b), which focused
only on compliance with water quality standards, section 401 required
applicants for Federal licenses and permits to obtain state
certification of compliance with the newly enacted provisions focused
on achieving effluent limitations. 33 U.S.C. 1341(a)(1). A few years
later, Congress amended section 401 to correct an omission from the
1972 statute and clarify that it still intended for states to also
certify compliance with water quality standards. See H.R. Rep. No. 95-
830, at 96 (1977) (inserting section 303 in the list of applicable
provisions throughout section 401).\17\
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\15\ City of Milwaukee v. Illinois, 451 U.S. 304, 310, 317
(1981).
\16\ 33 U.S.C. 1251(b).
\17\ The conference report noted that ``[t]he inserting of
section 303 into the series of sections listed in section 401 is
intended to mean that a federally licensed or permitted activity,
including discharge permits under section 402, must be certified to
comply with State water quality standards adopted under section 303.
The inclusion of section 303 is intended to clarify the requirements
of section 401. It is understood that section 303 is required by the
provisions of section 301. Thus, the inclusion of section 303 in
section 401 while at the same time not including section 303 in the
other sections of the Act where sections 301, 302, 306, and 307 are
listed is in no way intended to imply that 303 is not included by
reference to 301 in those other places in the Act, such as sections
301, 309, 402, and 509 and any other point where they are listed.
Section 303 is always included by reference where section 301 is
listed.'' Id.
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Section 401 of the 1972 Act also introduced a new subsection,
subsection (d), that explicitly provided states with the ability to
include ``effluent limitations and other limitations, and monitoring
requirements'' in their certification to assure that the applicant will
comply not only with sections 301, 302, 306, and 307, but also with
``any other appropriate requirement of State law.'' Id. at 1341(d). In
subsection (d), Congress also provided that any certification ``shall
become a condition on any Federal license or permit.'' Id.; see also S.
Rep. No. 92-414, at 69 (1971) (``The certification provided by a State
in connection with any Federal license or permit must set forth
effluent limitations and monitoring requirements necessary to comply
with the provisions of this Act or under State law and such a
certification becomes an enforceable condition on the Federal license
or permit.''). Consistent with Congress's intent to empower states to
protect their waters from the effects of federally licensed or
permitted projects, this provision ``assure[d] that Federal licensing
or permitting agencies cannot override State water quality
requirements.'' S. Rep. No. 92-414, at 69 (1971).
B. Overview of Section 401 Requirements
Under CWA section 401, a Federal agency may not issue a license or
permit to conduct any activity that may result in any discharge into
waters of the United States, unless the certifying authority where the
discharge would originate either issues a CWA section 401 water quality
certification or waives certification. 33 U.S.C. 1341(a)(1). The
applicant for the Federal license or permit that requires section 401
certification is responsible for obtaining certification or a waiver
from the certifying authority, which could be a state, territory,
authorized Tribe, or EPA, depending on where the discharge originates.
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
upon the request within a ``reasonable period of time (which shall not
exceed one year).'' Id. Additionally, during the reasonable period of
time, certifying authorities must comply with public notice procedures
established for certification requests, and where appropriate,
procedures for public hearings. Id.
If a certifying authority determines that the activity will comply
with the listed provisions in section 401(a)(1), it may grant or waive
certification. See section IV.E in this preamble for further discussion
on the scope of certification. When granting a CWA section 401
certification, certifying authorities must include conditions (e.g.,
``effluent limitations and other limitations, and monitoring
requirements'') pursuant to CWA section 401(d) necessary to assure that
the applicant for a Federal license or permit will comply with
applicable provisions of CWA sections 301, 302, 306, and 307, and with
``any other appropriate requirement of State law.'' 33 U.S.C. 1341(d).
If a certifying authority grants certification with conditions, those
conditions are incorporated into the Federal license or permit. Id.
Once an applicant provides a Federal agency with a certification, the
Federal agency may issue the license or permit. Id. at 1341(a)(1).
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 they may waive certification by ``fail[ing]
or refus[ing] to act on a request for certification within a reasonable
period of time.'' Id. Either way, the Federal licensing or permitting
agency may issue the Federal license or permit.
Although Congress provided section 401 certification authority to
the jurisdiction in which the discharge originates, Congress also
recognized that another state or authorized Tribe's water quality may
be affected by the discharge, and it created an opportunity for such a
state or authorized Tribe to raise objections to, and request a hearing
on, the Federal license or permit. See id. at 1341(a)(2). Section
401(a)(2) requires the Federal agency to ``immediately notify'' EPA
``upon receipt'' of a ``[license or permit] application and
certification.'' Id. EPA in turn has 30 days from that notification to
determine whether the discharge ``may affect'' the water quality of any
other state or authorized Tribe. Id. If the Agency makes a ``may
affect'' determination, it must notify the other state or authorized
Tribe, the Federal agency, and the applicant. The other state or
authorized Tribe then has 60 days to determine whether the discharge
will violate its water quality requirements. If the other state or
authorized Tribe makes such a determination within those 60 days, it
must notify EPA and the Federal agency, in writing, of its objection(s)
to the issuance of the Federal license or permit and request a public
hearing. Id. The Federal licensing or permitting agency is responsible
for holding the public hearing. At the hearing, EPA is required to
submit its evaluation and recommendations regarding the objection.
Based on the recommendations from the objecting state or authorized
Tribe and EPA's own evaluation and recommendation, as well as any
evidence presented at the
[[Page 66562]]
hearing, the Federal agency is required to condition the license or
permit ``in such manner as may be necessary to ensure compliance with
applicable water quality requirements.'' Id. The Federal license or
permit may not be issued ``if the imposition of conditions cannot
ensure such compliance.'' Id.
Section 401 also addresses when an applicant must provide separate
certifications for a facility's Federal construction license or permit
and any necessary Federal operating license or permit. Under section
401(a)(3), an applicant may rely on the same certification obtained for
the construction of a facility for any Federal operating license or
permit for the facility if (1) the Federal agency issuing the operating
license or permit notifies the certifying authority, and (2) the
certifying authority does not within 60 days thereafter notify the
Federal agency that ``there is no longer reasonable assurance that
there will be compliance with applicable provisions of sections [301,
302, 303, 306, and 307 of the CWA].'' Id.\18\
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\18\ Section 401(a)(3) identifies the bases a certifying
authority may rely upon for finding that there is no longer
reasonable assurance. These are changes after certification was
granted in: construction or operation of the facility,
characteristics of the water where the discharge occurs, or the
applicable water quality criteria or effluent limits or other
requirements. Id. at 1341(a)(3).
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Sections 401(a)(4) and (a)(5) describe circumstances where the
certified Federal license or permit may be suspended by the Federal
agency. First, a Federal agency may suspend a license or permit where a
certifying authority determines during a pre-operation inspection of
the facility or activity that it will violate applicable water quality
requirements. Id. at 1341(a)(4). This pre-operation inspection and
possible suspension apply only where a facility or activity does not
require a separate operating Federal license or permit. Under section
401, the Federal agency may not suspend the license or permit unless it
holds a public hearing.\19\ Id. Once a Federal license or permit is
suspended, it must remain suspended until the certifying authority
notifies the Federal agency that there is reasonable assurance that the
facility or activity will not violate applicable water quality
requirements. Id. Second, a Federal agency may suspend or revoke a
certified license or permit upon the entering of a judgment under the
CWA that the facility or activity violated applicable provisions of
section 301, 302, 303, 306, or 307 of the CWA. Id. at 1341(a)(5).
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\19\ Each Federal licensing or permitting agency may have its
own regulations regarding additional processes for suspending a
license or permit.
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Section 401 not only identifies the roles and obligations of
Federal license or permit applicants, certifying authorities, and
Federal agencies, it also provides specific roles for EPA. First, EPA
may act as a certifying authority where a state or authorized Tribe
``has no authority to give such certification.'' Id. at 1341(a)(1).
Second, as discussed above, EPA is responsible for notifying other
states or authorized Tribes that may be affected by a discharge from a
federally licensed or permitted activity, and where required, for
providing an evaluation and recommendations on such other state or
authorized Tribe's objections. Id. at 1341(a)(2). Lastly, EPA is
responsible for providing technical assistance upon request from
Federal agencies, certifying authorities, or Federal license or permit
applicants. Id. at 1341(b).
C. Prior Rulemaking Efforts Addressing Section 401
In the last 50 plus years, EPA has undertaken two rulemaking
efforts focused solely on addressing water quality certification, one
of which preceded the 1972 amendments to the CWA. The Agency has also
developed several guidance documents on the section 401 process. This
section of the preamble discusses EPA's major rulemaking and guidance
efforts over the last 50 plus years, including most recently the 2020
Rule and EPA's review of it pursuant to Executive Order 13990.
1. 1971 Rule
In February 1971, EPA proposed regulations implementing section
401's predecessor provision, section 21(b) of the FWPCA. 36 FR 2516
(February 5, 1971). Those proposed regulations were divided into four
subparts, one of which provided ``definitions of general applicability
for the regulations and . . . provide[d] for the uniform content and
form of certification.'' Id. The other three subparts focused on EPA's
roles. Id. In May 1971, after receiving public comments, EPA finalized
the water quality certification regulations with the proposed four-part
structure at 18 CFR part 615. 36 FR 8563 (May 8, 1971) (``1971 Rule'').
The first subpart of the 1971 Rule (subpart A) established
requirements that applied generally to all stakeholders in the
certification process, including an identification of information that
all certifying authorities must include in a certification. According
to the 1971 Rule, a certifying authority was required to include
several components in a certification, including the name and address
of the project applicant; a statement that the certifying authority
either examined the Federal license or permit application or examined
other information from the project applicant and, based upon that
evaluation, concluded that ``there is reasonable assurance that the
activity will be conducted in a manner which will not violate
applicable water quality standards;'' any conditions that the
certifying authority deemed ``necessary or desirable for the discharge
of the activity;'' and any other information the certifying authority
deemed appropriate. 40 CFR 121.2(a) (2019). Additionally, the 1971 Rule
allowed for modifications to certifications upon agreement by the
certifying authority, the Federal licensing or permitting agency, and
EPA. Id. at Sec. 121.2(b) (2019).
The second subpart of the 1971 Rule (subpart B) established a
process for EPA to provide notification of potential water quality
effects to other potentially affected jurisdictions. Under the 1971
Rule, the Regional Administrator was required to review the Federal
license or permit application, the certification or waiver, and, where
requested by EPA, any supplemental information provided by the Federal
licensing or permitting agency.\20\ If the Regional Administrator
determined that there was ``reason to believe that a discharge may
affect the quality of the waters of any State or States other than the
State in which the discharge originates,'' the Regional Administrator
would notify each affected state within 30 days of receipt of the
application materials and certification. Id. at Sec. Sec. 121.13,
121.16 (2019). In cases where the Federal licensing or permitting
agency held a public hearing on the objection raised by an affected
jurisdiction, the Federal agency was required to forward notice of such
objection to the Regional Administrator no later than 30 days prior to
the hearing. Id. at Sec. 121.15 (2019). At the hearing, the Regional
Administrator was required to submit an evaluation and
``recommendations as to whether and under what conditions the license
or permit should be issued.'' Id.
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\20\ If the documents provided are insufficient to make the
determination, the Regional Administrator can request any
supplemental information ``as may be required to make the
determination.'' 40 CFR 121.12 (2019).
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Subpart B also provided that certifying authorities may waive the
certification requirement under two circumstances: first, when the
certifying authority sends written notification expressly waiving its
authority to act on
[[Page 66563]]
a request for certification; and second, when the Federal licensing or
permitting agency sends written notification to the EPA Regional
Administrator that the certifying authority failed to act on a
certification request within a reasonable period of time after receipt
of such a request. Id. at Sec. 121.16 (2019). The 1971 Rule provided
that the Federal licensing or permitting agency determined what
constitutes a ``reasonable period of time,'' and that the period shall
generally be six months, but in any event no more than one year. Id. at
Sec. 121.16(b) (2019).
The third subpart of the 1971 Rule (subpart C) established
requirements that only applied when EPA acted as the certifying
authority, including identifying specific information that must be
included in a certification request. The project applicant was required
to submit to the EPA Regional Administrator a signed request for
certification that included a ``complete description of the discharge
involved in the activity for which certification is sought,'' which
included five items: the name and address of the project applicant, a
description of the facility or activity and of any related discharge
into waters of the United States, a description of the function and
operation of wastewater treatment equipment, dates on which the
activity and associated discharge would begin and end, and a
description of the methods to be used to monitor the quality and
characteristics of the discharge. Id. at Sec. 121.22 (2019). Once the
request was submitted to EPA, the Regional Administrator was required
to provide public notice of the request and an opportunity to comment.
The 1971 Rule specifically stated that ``[a]ll interested and affected
parties will be given reasonable opportunity to present evidence and
testimony at a public hearing on the question whether to grant or deny
certification if the Regional Administrator determined that such a
hearing is necessary or appropriate.'' Id. at Sec. 121.23 (2019). If,
after consideration of relevant information, the Regional Administrator
determined that there was ``reasonable assurance that the proposed
activity will not result in a violation of applicable water quality
standards,'' the Regional Administrator would issue the certification.
Id. at Sec. 121.24 (2019).
The fourth and final subpart of the 1971 Rule (subpart D) provided
that the Regional Administrator ``may, and upon request shall'' provide
Federal licensing and permitting agencies with information regarding
water quality standards and advise them as to the status of compliance
by dischargers with the conditions and requirements of applicable water
quality standards. Id. at Sec. 121.30 (2019).
In November 1971, EPA reorganized and transferred several
regulations, including the water quality certification regulations,
into title 40 of the Code of Federal Regulations. EPA subsequently
redesignated the water quality certification regulations twice in the
1970s. See 36 FR 22369, 22487 (November 25, 1971), redesignated at 37
FR 21441 (October 11, 1972), further redesignated at 44 FR 32854, 32899
(June 7, 1979). The last redesignation effort was part of a rulemaking
that extensively revised the Agency's NPDES regulations. In the revised
NPDES regulations, EPA addressed water quality certifications on EPA-
issued NPDES permits separately from the 1971 Rule. EPA acknowledged
that the 1971 Rule was ``in need of revision'' because the ``substance
of these regulations predates the 1972 amendments to the Clean Water
Act.'' 44 FR 32880 (June 7, 1979). However, EPA declined to revise the
1971 Rule because it had not consulted the other Federal agencies
impacted by the water quality certification process. Id. at 32856.
Instead, the Agency finalized regulations applicable only to
certification on EPA-issued NPDES permits. Id. at 32880. EPA developed
these regulations, which included a default reasonable period of time
of 60 days, limitations on certification modifications, and
requirements for certification conditions, in response to practical
challenges and issues arising from certification on EPA-issued permits.
Id. Ultimately, despite the changes Congress made to the statutory text
in 1972 and opportunities the Agency had to revisit the regulatory text
during redesignation efforts in the 1970s, EPA did not substantively
change the 1971 Rule until 2020.
2. EPA Guidance on 1971 Rule
Although EPA did not pursue any additional rulemaking efforts until
2019, the Agency issued three national guidance documents on the water
quality certification process set forth in the 1971 Rule. The first and
second guidance documents recognized the vital role section 401
certification can play in protecting state and Tribal water quality,
sought to inform states and Tribes how to use the certification program
to protect their waters, and explained how to leverage available
resources to operate or expand their certification programs. These
documents provided states and Tribes with background on the
certification process, discussed the relevant case law, and identified
data sources that could inform the certification review process.
Additionally, both documents provided tangible examples of state and
Tribal experiences with section 401 that could inform other states and
Tribes interested in developing their certification programs.
The first guidance document, issued in 1989, focused on how states
and Tribes could use water quality certifications to protect wetlands.
Wetlands and 401 Certification: Opportunities and Guidelines for States
and Eligible Indian Tribes (April 1989) (``1989 Guidance''). While the
1989 Guidance focused on the use of water quality certifications in
lieu of, or in addition to, state or Tribal wetlands regulatory
programs, it provided helpful background information on the
certification process in general. It also highlighted various state
programs and water quality certification practices to demonstrate how
other certifying authorities could approach the certification process.
For example, the 1989 Guidance highlighted a certification denial
issued by the then-Pennsylvania Department of Environmental Resources
to illustrate that ``all of the potential effects of a proposed
activity on water quality--direct and indirect, short and long term,
upstream and downstream, construction and operation--should be part of
a State's certification review.'' Id. at 22-23. Additionally, the 1989
Guidance discussed considerations states and Tribes could examine when
developing their own section 401 implementing regulations, as well as
programs and resources states and Tribes could look to for technical
support when making certification decisions. Id. at 30-37.
The second guidance document, issued in 2010, reflected the
development of case law and state and Tribal program experiences over
the two decades following the 1989 Guidance. Clean Water Act Section
401 Water Quality Certification: A Water Quality Protection Tool for
States and Tribes (May 2010) (``2010 Handbook'') (rescinded in 2019).
Instead of focusing on certifications in the context of wetland
protection, the 2010 Handbook described more broadly how the
certification process could help states and Tribes achieve their water
quality goals. Like the 1989 Guidance, the 2010 Handbook discussed the
certification process, using state and Tribal programs as examples, and
explored methods and means for states and Tribes to leverage available
funding, staffing, and data sources to fully implement a water quality
certification program. EPA
[[Page 66564]]
rescinded the 2010 Handbook on June 7, 2019, concurrent with the
publication of the third guidance document.
EPA issued the third guidance document in 2019 pursuant to
Executive Order 13868. Clean Water Act Section 401 Guidance for Federal
Agencies, States and Authorized Tribes (June 2019) (``2019 Guidance'')
(rescinded). The 2019 Guidance was meant to ``facilitate consistent
implementation of section 401 and 1971 certification regulations''
based on the view that the 2010 Handbook did not ``reflect current case
law interpreting CWA section 401.'' 85 FR 42213. The 2019 Guidance
focused on three topics: (1) timeline for certification review and
action, (2) the scope of section 401, and (3) the information within
the scope of a certifying authority's review. 2019 Guidance at 1. EPA
rescinded the 2019 Guidance on July 13, 2020, concurrent with the
publication of the final 2020 Rule.
3. Development of the 2020 Rule
In addition to directing EPA to review its 2010 Handbook and issue
new section 401 guidance, Executive Order 13868, entitled Promoting
Energy Infrastructure and Economic Growth, also directed EPA to propose
new regulations governing section 401 consistent with the policy set
forth in the order to ``promote private investment in the Nation's
energy infrastructure.'' 84 FR 13495, 13496 (April 15, 2019). It is
noteworthy that, even in the context of directing EPA to initiate
changes to a water quality protection rule, the executive order did not
direct the Agency to consider the water quality consequences of any
such changes. EPA issued the proposed rule on August 22, 2019.\21\ EPA
promulgated a final rule on July 13, 2020. Clean Water Act Section 401
Certification Rule, 85 FR 42210 (July 13, 2020) (``2020 Rule'').
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\21\ Updating Regulations on Water Quality Certifications, 84 FR
44080 (August 22, 2019).
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The 2020 Rule reaffirmed that Federal agencies unilaterally set the
reasonable period of time, clarified that the certification requirement
was triggered by a point source discharge from a federally licensed or
permitted activity into ``waters of the United States,'' and reaffirmed
that certifying authorities may explicitly waive certification. The
2020 Rule also introduced several new features, including one that
allowed Federal agencies to review certification decisions for
compliance with the 2020 Rule's requirements and, if the certification
decision did not comply with these requirements, allowed Federal
agencies to deem such non-compliant certifications as waived. The 2020
Rule also prohibited a certifying authority from requesting a project
applicant to withdraw and resubmit a certification request and rejected
the scope of certification review (``activity as a whole'') affirmed by
the Supreme Court in PUD No. 1 of Jefferson County v. Washington
Department of Ecology, 511 U.S. 700 (1994), in favor of a more limiting
interpretation (``discharge-only'' approach) favored by two dissenting
Justices in that case.
Following publication, the 2020 Rule was challenged in three
Federal district courts by states, Tribes, and non-governmental
organizations.\22\ Industry stakeholders and eight states intervened on
behalf of EPA to defend the 2020 Rule. On October 21, 2021, following
briefing and a hearing on EPA's motion for remand without vacatur, the
U.S. District Court for the Northern District of California both
remanded and vacated the 2020 Rule. In re Clean Water Act Rulemaking,
568 F. Supp. 3d 1013 (N.D. Cal. 2021) (reversed and remanded by 60
F.4th 583 (9th Cir. 2023)). The court found that vacatur was
appropriate ``in light of the lack of reasoned decision-making and
apparent errors in the rule's scope of certification, indications that
the rule contravenes the structure and purpose of the Clean Water Act,
and that EPA itself has signaled that it could not or would not adopt
the same rule upon remand.'' Id. at 1026-27. The court order required a
temporary return to EPA's 1971 Rule until EPA finalized a new rule.\23\
After the Ninth Circuit denied intervenors' motion for stay pending
appeal on February 24, 2022, intervenors filed an application for a
stay of the vacatur pending appeal in the Supreme Court on March 21,
2022. On April 6, 2022, the U.S. Supreme Court granted the application
for a stay of the vacatur pending resolution of the appeal of the
vacatur in the Ninth Circuit. Louisiana v. Am. Rivers, No. 21A539 (S.
Ct. April 6, 2022). On February 21, 2023, the Ninth Circuit reversed
the remand with vacatur and remanded the case back to the U.S. District
Court for the Northern District of California for further proceedings.
In Re Clean Water Act Rulemaking, No. 21-16958 (9th Cir. February 21,
2023).
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\22\ In Re Clean Water Act Rulemaking, No. 3:20-cv-04636-WHA
(N.D. Cal.); Delaware Riverkeeper et al. v. EPA, No. 2:20-cv-03412
(E.D. Pa.); S.C. Coastal Conservation League v. EPA, No. 2:20-cv-
03062 (D.S.C.).
\23\ The two other courts also remanded the 2020 Rule to EPA,
but without vacatur. Order, Delaware Riverkeeper v. EPA, No. 2:20-
cv-03412 (E.D. Pa. August 6, 2021) (determining that vacatur was not
appropriate because the court ``has not yet, and will not, make a
finding on the substantive validity of the Certification Rule'');
Order, S.C. Coastal Conservation League v. EPA, No. 2:20-cv-03062
(D.S.C. August 2, 2021) (remanding without vacating).
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4. Executive Order 13990 and Review of the 2020 Rule
On January 20, 2021, President Biden signed Executive Order 13990,
Protecting Public Health and the Environment and Restoring Science to
Tackle the Climate Crisis (Order). 86 FR 7037 (published January 25,
2021, signed January 20, 2021). The Order provides that ``[i]t is,
therefore, the policy of my Administration to listen to the science; to
improve public health and protect our environment; to ensure access to
clean air and water; to limit exposure to dangerous chemicals and
pesticides; to hold polluters accountable, including those who
disproportionately harm communities of color and low-income
communities; to reduce greenhouse gas emissions; to bolster resilience
to the impacts of climate change; to restore and expand our national
treasures and monuments; and to prioritize both environmental justice
and the creation of the well-paying union jobs necessary to deliver on
these goals.'' Id. at 7037, Section 1. The Order ``directs all
executive departments and agencies (agencies) to immediately review
and, as appropriate and consistent with applicable law, take action to
address the promulgation of Federal regulations and other actions
during the last 4 years that conflict with these important national
objectives, and to immediately commence work to confront the climate
crisis.'' Id. ``For any such actions identified by the agencies, the
heads of agencies shall, as appropriate and consistent with applicable
law, consider suspending, revising, or rescinding the agency actions.''
Id., section 2(a). The Order also revoked Executive Order 13868 of
April 10, 2019 (Promoting Energy Infrastructure and Economic Growth),
which initiated development of the 2020 Rule, and specifically
identified the 2020 Rule for review. See Fact Sheet: List of Agency
Actions for Review, available at https://www.whitehouse.gov/briefing-room/statements-releases/2021/01/20/fact-sheet-list-of-agency-actions-for-review/ (last visited on January 27, 2022).
EPA reviewed the 2020 Rule in accordance with Executive Order 13990
and, in the spring of 2021, determined that it would propose revisions
to the 2020 Rule through a new rulemaking effort. See Notice of
Intention to Reconsider and Revise the Clean Water Act Section 401
Certification Rule, 86
[[Page 66565]]
FR 29541 (June 2, 2021). EPA considered several factors in making this
determination, including but not limited to the text of CWA section
401; congressional intent and the cooperative federalism framework of
CWA section 401; concerns raised by stakeholders about the 2020 Rule,
including implementation-related feedback; the principles outlined in
the Executive Order; and issues raised in litigation challenging the
2020 Rule. Id. In particular, the Agency identified substantial
concerns about whether portions of the 2020 Rule impinged on the
cooperative federalism principles central to CWA section 401. The
Agency identified this and other concerns as they related to different
provisions of the 2020 Rule, including certification requests, the
reasonable period of time, scope of certification, certification
actions and Federal agency review, enforcement, and modifications. See
id. at 29543-44.
Agencies have inherent authority to reconsider past decisions and
to revise, replace, or repeal a decision to the extent permitted by law
and supported by a reasoned explanation. FCC v. Fox Television
Stations, Inc., 556 U.S. 502, 515 (2009) (``Fox''); Motor Vehicle Mfrs.
Ass'n of the U.S., Inc. v. State Farm Mutual Automobile Ins. Co., 463
U.S. 29, 42 (1983); see also Encino Motorcars, LLC v. Navarro, 579 U.S.
211, 221 (2016) (``Agencies are free to change their existing policies
as long as they provide a reasoned explanation for the change.''). Such
a decision need not be based upon a change of facts or circumstances. A
revised rulemaking based ``on a reevaluation of which policy would be
better in light of the facts'' is ``well within an agency's
discretion.'' Nat'l Ass'n of Home Builders v. EPA, 682 F.3d 1032, 1038
& 1043 (D.C. Cir. 2012) (citing Fox, 556 U.S. at 514-15). The Agency
reviewed the 2020 Rule, determined that the rule should be replaced,
and proposed a replacement rule. Some commenters on the proposed rule
opposed reconsideration of the 2020 Rule and asserted that EPA did not
provide a basis for reconsideration of the 2020 Rule. EPA disagrees.
EPA proposed the replacement rule only after reviewing the statutory
text, legislative history, case law, and public comments. EPA found,
and continues to find, it appropriate to revise the 2020 Rule for
several reasons. First, the 2020 Rule does not represent the best
statutory interpretation of fundamental concepts, such as the scope of
certification. See section IV.E in this preamble for further discussion
on why the 2020 Rule's interpretation of the scope of certification is
inconsistent with the statutory text of section 401 and authoritative
Supreme Court precedent interpreting that text. Further, the 2020 Rule
did not align with the broader water quality protection goals of the
Act or congressional intent behind development and passage of section
401. The 2020 Rule also failed to appropriately address adverse impacts
to state and Tribal water quality, as evidenced in public comment.\24\
See e.g., section IV.E of this preamble for further discussion on the
potential adverse water quality-related impacts of the 2020 Rule's
interpretation of the scope of certification.
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\24\ For example, commenters noted that use of the 2020 Rule's
procedural requirements on certifications for the Army Corps of
Engineers' (Corps) Nationwide General Permits resulted in
certifications with conditions or denials being treated as
constructive waivers. As discussed in section IV.F in this preamble,
the Agency recognizes that a constructive waiver is a severe
consequence; a waiver means that a Federal license or permit that
could adversely impact the certifying authority's water quality
(i.e., cause noncompliance with water quality requirements) may
proceed without any input from the certifying authority.
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Accordingly, EPA is now finalizing revisions to the 2020 Rule to be
fully consistent with the 1972 and 1977 CWA amendments, the Agency's
legal authority, and the principles outlined in Executive Order 13990.
This final rule revises the 2020 Rule to better reflect the CWA's
statutory text, the legislative history regarding section 401, and the
broad water quality protection goals of the Act. In addition, the final
rule clarifies certain aspects of section 401 implementation that have
evolved in response to over 50 years of judicial interpretation and
certifying authority practice, and it supports an efficient and
predictable water quality certification process that is consistent with
the cooperative federalism principles central to the CWA and section
401.
D. Summary of Stakeholder Outreach
Following the publication of EPA's notice of intent to revise the
2020 Rule, the Agency opened a public docket to receive written pre-
proposal recommendations for a 60-day period beginning on June 2, 2021
and concluding on August 2, 2021. The Agency received nearly 3,000
recommendations from members of the public, which can be found in the
pre-proposal docket. See Docket ID No. EPA-HQ-OW-2021-0302. The Federal
Register publication requested feedback related to key issues
identified during implementation of the 2020 Rule, including but not
limited to issues regarding pre-filing meeting requests, certification
requests, reasonable period of time, scope of certification,
certification actions and Federal agency review, enforcement,
modifications, neighboring jurisdictions, data and other information,
and implementation coordination. See 86 FR 29543-44 (June 2, 2021).
EPA also held a series of virtual listening sessions for certifying
authorities (June 14, June 23, and June 24, 2021), project applicants
(June 15, 2021), and the public (June 15, and June 23, 2021) to gain
further pre-proposal input. See id. at 29544 (announcing EPA's
intention to hold multiple webinar-based listening sessions). EPA also
met with stakeholders upon request during development of the proposed
rule. More information about the outreach and engagement conducted by
EPA during the pre-proposal input period can be found in Docket ID No.
EPA-HQ-OW-2022-0128. Additionally, EPA also met with other Federal
licensing and permitting agencies to solicit feedback on the Federal
Register publication. At the virtual listening sessions, the Agency
gave a presentation that provided background on section 401 and prior
Agency actions and sought input on the Agency's intent to revise the
2020 Rule and the specific issues included in the Federal Register
publication described above.
The Agency heard from stakeholders representing a diverse range of
interests and positions and received a wide variety of recommendations
during this pre-proposal outreach process. Some certifying authorities
expressed concern about the limited role of states and Tribes under the
2020 Rule, and they called for increased flexibility in implementing
section 401 to fully protect their water resources. During the project
proponent listening session, project proponents shared feedback about
the need to streamline the certification process and recommended that
the new rule prevent delays in determining certification decisions. In
the public listening sessions, speakers from non-governmental
environmental and water conservation organizations reinforced the idea
that states and Tribes should be accorded greater deference in the
certification process. An overarching theme articulated by many
speakers from various stakeholder groups was the need for EPA's new
rule to provide increased guidance and clarity.
The Agency also initiated a Tribal consultation and coordination
process on June 7, 2021. The Agency engaged with Tribes over a 90-day
consultation period during development of the
[[Page 66566]]
proposed rule that concluded on September 7, 2021, including two Tribal
consultation kickoff webinars on June 29, 2021, and July 7, 2021. The
Agency received consultation letters from eight Tribes and three Tribal
organizations. The Agency did not receive any requests for consultation
during that time, although several Tribes expressed an interest in
receiving additional information and ongoing engagement throughout the
rulemaking process. Several Tribes commented that the 2020 Rule
impaired or undermined Tribal sovereignty and their ability to protect
Tribal waters. Many Tribes provided input regarding section 401
certification process improvements. Most Tribes were generally positive
about a provision for a pre-filing meeting request, however, some had
concerns that the 30-day wait period (before a project proponent could
request certification) is very rigid and preferred flexibility in
allowing certifying authorities to waive the 30-day requirement. Some
Tribes expressed ``the reasonable period of time'' should start when
the application is deemed complete, not when the initial request for
certification is received. Most Tribes argued that the 2020 Rule's
narrowing of the scope of certification was inconsistent with
congressional intent for Tribes and states to have an effective tool to
protect the quality of waters under their jurisdiction. A few Tribal
organizations expressed concern that current implementation of section
401(a)(2) does not protect off-reservation treaty rights from
discharges. Additional information about the Tribal consultation
process can be found in section VI.F in this preamble and the ``Summary
Report of Tribal Consultation and Engagement for the Clean Water Act
Section 401 Water Quality Certification Improvement Rule,'' which is
available in the docket for this final rule.
The Agency signed a proposed rule updating the CWA section 401
water quality certification process on June 1, 2022. On June 9, 2022,
the Agency published the proposed rulemaking in the Federal Register,
87 FR 35318 (June 9, 2022), which initiated a 60-day public comment
period that lasted through August 8, 2022. EPA held a virtual public
hearing on July 18, 2022, and hosted a series of stakeholder listening
sessions throughout June 2022, including one listening session for
project proponents on June 14, 2022, three listening sessions for
States and territories on June 15, 22, and 28, 2022, and three
listening sessions for Tribes on June 15, 22, and 28, 2022. The Agency
also hosted a Federal agency listening session on June 14, 2022.
In finalizing the proposed rule, the Agency reviewed and considered
approximately 27,000 comments received on the proposed rulemaking from
a broad spectrum of interested parties. Commenters provided a wide
range of feedback on the proposal, including the substantive and
procedural aspects of the certification process, how the proposed rule
would impact stakeholders, and the legal basis for the proposed rule.
The Agency discusses comments received and responses in the applicable
sections of the preamble to this rule. A complete response to comments
document is available in the docket for this rule (Docket ID No. EPA-
HQ-OW-2022-0128).
IV. Final Rule
EPA is the primary agency responsible for developing regulations
and guidance to ensure effective implementation of CWA programs,
including section 401. See 33 U.S.C. 1251(d), 1361(a). The Agency is
finalizing revisions to the section 401 regulations to better align its
regulations with the cooperative federalism and water quality
protection principles enshrined in the text and legislative history of
the CWA. Additionally, the final rule provides greater clarity and
acknowledgment of essential water quality protection concepts from
Executive Order 13990. In addition to providing a necessary regulatory
reset on significant issues such as the scope of certification, the
reasonable period of time, and Federal agency review, the Agency is
finalizing its revisions to clarify and update the regulatory text to
foster a more efficient and predictable certification process. As
demonstrated by the extensive pre-proposal and proposed rule outreach,
this rulemaking is well-informed by stakeholder input on all aspects of
the section 401 certification process.
In addition to the revisions to part 121, EPA is also finalizing
conforming changes to the part 124 regulations governing CWA section
401 certifications for EPA-issued NPDES permits. The final part 121
regulations apply to all Federal licenses or permits subject to CWA
section 401 certification, including EPA-issued NPDES permits.\25\ The
purpose of these conforming changes is to ensure that the part 124
regulations are consistent with the revised provisions of part 121. In
the proposal for this rule, EPA requested comment on whether the Agency
had identified all changes to the part 124 regulations that conflict or
potentially conflict with the proposal and therefore warrant amendment.
EPA is finalizing targeted revisions to specific provisions of the
NPDES regulations at 40 CFR 124.53, 124.54, and 124.55 that implement
section 401. Specifically, EPA is finalizing targeted revisions to 40
CFR 124.53(b) through (e), 124.54(a) and (b), and 124.55(a) through
(d). In addition, EPA is finalizing targeted conforming revisions to
the regulations at 40 CFR 122.4(b), 122.44(d)(3), and
122.62(a)(3)(iii). EPA explains in further detail the reasons for each
conforming change (beyond mere technical revisions) in the preamble
discussion at sections IV.C, IV.D, IV.E, IV.F, IV.G, and IV.I of this
preamble.
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\25\ See Sec. 121.1(c), (f) (defining ``Federal agency'' to
mean ``any agency of the Federal Government to which application is
made for a Federal license or permit that is subject to Clean Water
Act section 401,'' and similarly defining ``license or permit'' to
mean ``any license or permit issued or granted by an agency of the
Federal Government to conduct any activity which may result in any
discharge into waters of the United States'').
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EPA is also finalizing several revisions to the definitions section
of the final rule at Sec. 121.1. EPA is finalizing minor revisions to
the definition of ``Administrator,'' located at Sec. 121.1(a), to
remove the reference to authorized representatives. Instead, the Agency
is adding a separate definition for ``Regional Administrator.'' See
Sec. 121.1(i). The Agency is removing the definition for
``certification,'' which was located at Sec. 121.1(b) in the 2020
Rule, because it is not necessary to define the term. Additionally, the
Agency is removing the definitions for ``certified project'' \26\ and
``proposed project'' \27\ because the final rule does not include those
terms. EPA is also clarifying the roles of the stakeholders in the
certification process. First, the Agency is finalizing non-substantive
modifications to the definition of ``Federal agency'' located at final
rule Sec. 121.1(c). Second, the Agency is retaining the term ``project
proponent'' from the 2020 Rule to define the stakeholder seeking
certification. 40 CFR 121.1(h). While the term ``applicant'' is used in
section 401, that term does not clearly reflect and include all the
stakeholders who might seek certification. For example, Federal
agencies themselves (and not third-party applicants) seek section 401
certification on the issuance of general permits (e.g., Corps'
Nationwide Permits, EPA's Construction General Permits). Additionally,
contractors or other agents often seek certification on
[[Page 66567]]
behalf of a project applicant. The term ``project proponent'' is meant
to include the applicant for a Federal license or permit, as well as
any other entity that may seek certification (e.g., agent of an
applicant or a Federal agency, such as EPA when it is the permitting
authority for a National Pollutant Discharge Elimination System (NPDES)
permit). Lastly, the Agency is finalizing non-substantive changes to
the definition of ``certifying authority'' located at final rule Sec.
121.1(b). Other revisions to regulatory definitions are discussed
throughout this preamble.
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\26\ 40 CFR 121.1(d) (2020).
\27\ 40 CFR 121.1(k) (2020).
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This section of the final rule preamble includes 12 sub-sections
that each discuss: (1) the final rule provisions, (2) a summary of the
Agency's final rule rationale and public comments (where applicable),
and (3) implementation considerations for the final rule provisions
(where applicable). Section IV.A of this preamble discusses when
section 401 certification is required. Sections IV.B through IV.F of
this preamble walk readers through the section 401(a)(1) certification
process in chronological order (i.e., pre-filing meeting request
through the certification decision). Section IV.G of this preamble
discusses the Federal agency review process that follows the section
401(a)(1) certification process. Section IV.K of this preamble
discusses the section 401(a)(2) neighboring jurisdictions process that
occurs after the section 401(a)(1) certification process (if the
certification was granted or waived), but before the Federal license or
permit may be issued. Sections IV.I through IV.J of this preamble
discuss events that may occur after the certification is granted until
the Federal license or permit expires, including certification
modifications (section IV.I of this preamble) and enforcement and
inspection (section IV.J of this preamble). Section IV.H of this
preamble discusses EPA's roles under section 401, including EPA's role
as the certifying authority. Section IV.L of this preamble discusses
the new provisions for Tribes to obtain treatment in a similar manner
as a state (TAS) for section 401 or section 401(a)(2). Section IV.M of
this preamble discusses general implementation considerations for this
final rule. Lastly, section IV.N discusses severability of this final
rule. This final rule is structured in a manner to clearly and
transparently convey to stakeholders the CWA section 401 certification
and post-certification processes.
A. When Section 401 Certification Is Required
1. What is the Agency finalizing?
EPA is finalizing the regulatory text located at final rule Sec.
121.2 to affirm that a ``[c]ertification or waiver is required for any
Federal license or permit that authorizes any activity which may result
in any discharge from a point source into waters of the United
States.'' 40 CFR 121.2. The regulatory text clarifies the circumstances
under which a section 401 certification is required and is consistent
with the Agency's longstanding interpretation of section 401, including
in the 2020 Rule, that an applicant for a Federal license or permit to
conduct any activity that may result in any discharge from a point
source \28\ into waters of the United States must obtain a section 401
certification or waiver. The Agency made minor revisions to the
proposed text at Sec. 121.2 to better match the statutory language in
section 401(a)(1) and clarify when certification is required, including
adding the word ``Federal'' before license or permit, ``any'' before
both ``activity'' and ``discharge,'' and changing from ``a water of the
United States'' to ``waters of the United States.'' To be clear, these
changes do not represent a change in substance from proposal.
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\28\ For ease of discussion and comprehension, the Agency uses
the term ``discharge'' interchangeably with the more precise
``discharge from a point source'' or ``point source discharge.'' As
discussed in section IV.A.2.c of this preamble, several years after
PUD No. 1, the Ninth Circuit clarified that the type of
``discharge'' that triggers section 401's certification requirement
is a ``point source'' discharge. ONDA v. Dombeck, 172 F.3d 1092 (9th
Cir. 1998).
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2. Summary of Final Rule Rationale and Public Comment
a. Federally Licensed or Permitted Activity
Section 401 certification is required for any Federal license or
permit to conduct any activity that may result in any discharge into
``waters of the United States.'' 33 U.S.C. 1341(a)(1). The Agency is
retaining the 2020 Rule's definition for a ``license or permit'' with
minor modifications to clarify that section 401 is required for any
federally licensed or permitted activity which may result in any
discharge into waters of the United States. EPA is also adding the word
``Federal'' before ``license or permit'' throughout the final rule to
further clarify that the license or permit subject to certification
must be Federal.
The CWA is clear that the license or permit prompting the need for
a section 401 certification must be a Federal license or permit, that
is, one issued by a Federal agency. This conclusion is supported by the
legislative history of CWA section 401, which noted that ``since
permits granted by States under section 402 are not Federal permits--
but State permits--the certification procedures are not applicable.''
H.R. Rep. No. 92-911, at 127 (1972). Additionally, the legislative
history of the CWA amendments of 1977, discussing state assumption of
section 404, noted that ``[t]he conferees wish to emphasize that such a
State program is one which is established under State law and which
functions in lieu of the Federal program. It is not a delegation of
Federal authority.'' H.R. Rep. No. 95-830, at 104 (1977).
Section 401 certification is not required for licenses or permits
issued by a state or Tribe that administers a federally approved permit
program. For example, states and Tribes may be authorized to administer
the section 402 NPDES permitting program \29\ or the section 404 dredge
and fill permitting program.\30\ Permits issued by states or Tribes
pursuant to their authorized or approved program are not subject to
section 401 of the CWA as the programs operate in lieu of the Federal
program, under state or Tribal authorities. The state or Tribal permit
is not a ``Federal'' permit for purposes of section 401.
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\29\ 33 U.S.C. 1342(b).
\30\ 33 U.S.C. 1344(g).
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The Agency is not providing an exclusive list of Federal licenses
and permits that may be subject to section 401. The CWA itself does not
list specific Federal licenses and permits that are subject to section
401 certification requirements. The most common examples of Federal
licenses or permits that may be subject to section 401 certification
are CWA section 402 NPDES permits issued by EPA in jurisdictions where
the EPA administers the NPDES permitting program; CWA section 404
permits for the discharge of dredged or fill material permits issued by
the Army Corps of Engineers as well as Rivers and Harbors Act sections
9 and 10 permits issued by the Army Corps of Engineers; and hydropower
and interstate natural gas pipeline licenses issued by the Federal
Energy Regulatory Commission (FERC).\31\ See
[[Page 66568]]
section IV.A.3 infra for further discussion on the types of Federal
licenses or permits subject to section 401.
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\31\ The Corps also requires section 401 certification for its
civil works projects, even though there is no Federal license or
permit associated with those projects. The Corps' current
regulations require the Corps to seek section 401 certification for
discharges of dredged material or fill into waters of the United
States. See 33 CFR 336.1(a)(1) (``The CWA requires the Corps to seek
state water quality certification for discharges of dredged or fill
material into waters of the U.S.''); 33 CFR 335.2 (``[T]he Corps
does not issue itself a CWA permit to authorize Corps discharges of
dredged material or fill material into U.S. waters but does apply
the 404(b)(1) guidelines and other substantive requirements of the
CWA and other environmental laws.''). In these instances, EPA
understands that the Corps will follow the certification process as
described in the final rule.
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b. Potential for a Discharge To Occur
Consistent with the 2020 Rule and the proposal, a certification or
waiver is required for any Federal license or permit that authorizes
any activity which may result in any discharge from a point source into
waters of the United States. 40 CFR 121.2. The presence of, or
potential for, a discharge is a key determinant for when a water
quality certification is required. 33 U.S.C. 1341(a)(1) (``A
certification is required for ``a Federal license or permit to conduct
any activity . . . which may result in any discharge into the navigable
waters . . .'') (emphasis added); see 40 CFR 121.2. Most commenters
supported the clarification in proposed Sec. 121.2 that section 401 is
triggered by a point source discharge as well as when any Federal
license or permit authorizes any activity that may result in any point
source discharge. A few commenters, seeming to refer to the proposal
preamble as opposed to regulatory text, expressed concern that the
addition of the word ``potential'' would change the universe of
projects requiring 401 certification; EPA disagrees. EPA's approach is
consistent with the plain language of the statutory phrase ``may result
in any discharge.'' The phrase ``may result'' contemplates that both
the presence of, and/or potential for, any discharge triggers the
requirement for a section 401 certification. This approach is also
consistent with the Agency's longstanding implementation of section
401. See, e.g., 85 FR 42236 (July 13, 2020) (``Under this final rule,
the requirement for a section 401 certification is triggered based on
the potential for any federally licensed or permitted activity to
result in a discharge from a point source into waters of the United
States.''); 2010 Handbook at 4 (rescinded in 2019, see supra) (``It is
important to note that [section] 401 is triggered by the potential for
a discharge; an actual discharge is not required.'').
EPA requested comment on whether it should develop a specific
process or procedure for project proponents, certifying authorities,
and/or Federal agencies to follow to determine whether a federally
licensed or permitted activity may result in a discharge and therefore
require section 401 certification. Some commenters asserted that EPA
should not develop such a process because certifying authorities and/or
Federal agencies have well-established practices and experience
determining whether an activity will require a section 401
certification, including one commenter who asserted that an EPA-defined
process could disrupt established efficiencies. Conversely, some
commenters asserted that EPA should develop a process for determining
when a federally licensed or permitted activity may result in a
discharge and require section 401 certification for various reasons,
asserting that such a process would allow for consistent
implementation.
Based on comments, the Agency is not developing a specific process
or procedure for project proponents, certifying authorities, and/or
Federal agencies to follow to determine whether a federally licensed or
permitted activity may result in a discharge and therefore require
section 401 certification. After more than 50 years of implementing
section 401, EPA's experience is that Federal agencies and certifying
authorities are well-versed in the practice of determining which
federally licensed or permitted projects may result in discharges.
Ultimately, the project proponent is responsible for obtaining all
necessary permits and authorizations, including a section 401
certification. If there is a potential for a project to discharge into
``waters of the United States,'' a Federal agency cannot issue the
Federal license or permit unless a section 401 certification is granted
or waived by the certifying authority. EPA recommends that project
proponents engage in early discussions with certifying authorities and
Federal agencies to determine whether their federally licensed or
permitted activity will require section 401 certification.
c. Discharge
Consistent with the Agency's longstanding position and the 2020
Rule, EPA is finalizing that a discharge from a point source (or
``point source discharge''), or potential for one, is required to
trigger section 401. See 40 CFR 121.2. Additionally, the Agency is
clarifying that, consistent with S.D. Warren v. Maine Board of
Environmental Protection, 547 U.S. 370 (2006), discussed below, a point
source discharge triggering section 401 does not require the addition
of pollutants. Although the Agency is retaining the same interpretation
of ``discharge'' as the 2020 Rule, to simplify the regulation, the
Agency is removing the definition of ``discharge'' \32\ and instead
incorporating those definitional concepts into the regulatory text at
final rule Sec. 121.2, which discusses when certification is required.
This simpler approach will provide greater clarity about the nature of
discharges that trigger the need for section 401 certification or
waiver.
---------------------------------------------------------------------------
\32\ 40 CFR 121.1(f) (2020).
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The CWA provides that ``[t]he term `discharge' when used without
qualification includes a discharge of a pollutant, and a discharge of
pollutants.'' 33 U.S.C. 1362(16) (emphasis added). The CWA defines
``discharge of a pollutant'' to mean ``any addition of any pollutant to
navigable waters from any point source.'' Id. at 1362(12). EPA and the
Corps \33\ have long interpreted the definition of ``discharge'' in way
that gives meaning to the word ``includes'' in the definition. EPA and
the Corps have interpreted the definition of ``discharge'' to be
distinct from the term ``discharge of pollutant'' and therefore
encompassing both the discharge without the addition of pollutants and
the ``discharges of pollutants.'' Many commenters supported the
Agency's clear articulation of its longstanding interpretation that any
discharge triggering a section 401 certification does not require an
addition of pollutants. On the other hand, some commenters argued that
eliminating the requirement that there be an addition of pollutants
goes beyond the plain language of CWA section 401. As an initial
matter, the final rule's interpretation of discharge is not a change
from longstanding practice, including the 2020 Rule. See 85 FR 42237
(``The EPA has concluded that unlike other CWA regulatory provisions,
section 401 is triggered by the potential for any unqualified
discharge, rather than by a discharge of pollutants.''). EPA strongly
disagrees that the plain language of section 401 requires that any
discharge triggering section 401 include an addition of pollutants. As
discussed above, the statutory definition of ``discharge'' is broad and
is not limited to a discharge of pollutants. Additionally, as discussed
below, this interpretation is consistent with the text
[[Page 66569]]
of the statute as interpreted by the U.S. Supreme Court.
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\33\ In the context of section 404, the Corps does the day-to-
day work of conducting jurisdictional determinations though EPA has
final administrative authority over the scope of CWA jurisdiction.
Administrative Authority to Construe Sec. 404 of the Federal Water
Pollution Control Act (``Civiletti Memorandum''), 43 Op. Att'y Gen.
197 (1979).
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In S.D. Warren, a hydropower dam operator asserted that its dams
did not result in discharges that would require section 401
certification because the dams only released water that ``adds nothing
to the river that was not there above the dams.'' 547 U.S. 370, 374-75,
378 (2006). The Court stated that the term discharge is broader than
``discharge of a pollutant'' and ``discharge of pollutants.'' Id.
Observing that the term ``discharge'' is not specifically defined in
the statute, the Court applied the ordinary dictionary meaning,
``flowing or issuing out.'' Id. In applying this meaning to
hydroelectric dams, the Court held that releasing water through a dam
constituted a discharge for purposes of section 401 and, thus, the CWA
provided states with the ability to address water quality impacts from
these releases through the certification process. Id. at 385-86. The
Court explicitly rejected the argument that an ``addition'' was
necessary for a ``discharge,'' stating ``[w]e disagree that an addition
is fundamental to any discharge.'' Id. at 379 n.5.
While the Supreme Court has held that the addition of a pollutant
is not necessary for a discharge to prompt the need for a CWA section
401 certification, the Ninth Circuit has held that such certification-
triggering discharges must be from point sources. Or. Natural Desert
Ass'n (ONDA) v. Dombeck, 172 F.3d 1092, 1095-99 (9th Cir. 1998)
(``ONDA'').\34\ In ONDA, the Ninth Circuit addressed the issue of
whether ``the term `discharge' in [section 401] includes releases from
nonpoint sources as well as releases from point sources.'' Id. at 1094-
95. The court held that the ``term `discharge' in [section 401] is
limited to discharges from point sources.'' Id. at 1097. The court
found its holding to be consistent with the Supreme Court's holding in
PUD No. 1. 511 U.S. 700 (1994).\35\ The court in ONDA found that
although PUD No. 1 held that certification conditions may address water
quality impacts from the certified activity beyond its discharges, a
triggering discharge is still required for section 401 to apply and
``PUD No. 1 did not broaden the meaning of the term `discharge' under
Sec. 1341.'' Id. at 1098-99.\36\ EPA has consistently implemented the
Ninth Circuit's interpretation of section 401 as requiring the
potential for a point source discharge (with or without the addition of
pollutants) to trigger section 401. See 85 FR 42238; 2010 Handbook at
5-6 (rescinded in 2019, see supra) (discussing requirement of section
401 certification when there is a point source discharge).\37\
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\34\ In ONDA, the United States took the position that the term
``discharge'' at 33 U.S.C. 1362(14) did not include nonpoint sources
because there was nothing in the definition or the legislative
history of the term that suggested it extended to nonpoint source
pollution. Brief of the United States in Or. Natural Desert Ass'n v.
Dombeck, Nos. 97-3506, 97-35112, 97-35115, at 18-21 (9th Cir. 1997).
Additionally, the United States argued that section 401's
legislative history did not suggest that ``discharge'' included
nonpoint sources. Id. at 23-24.
\35\ See section IV.E of this preamble for further discussion of
on PUD No 1.
\36\ Following the Supreme Court's decision in S.D. Warren that
the addition of a pollutant was not needed to trigger section 401,
the Ninth Circuit reaffirmed its earlier decision that section 401
was only triggered by a discharge from a point source. Or. Natural
Desert Ass'n v. USFS, 550 F.3d 778 (9th Cir. 2008). The Ninth
Circuit held that ``[n]either the ruling nor the reasoning in S.D.
Warren is inconsistent with this court's treatment of nonpoint
sources in [section] 401 of the Act, as explained in [ONDA].'' Id.
at 785.
\37\ The United States argued that section 401 requires the
discharge to be from a point source in briefs filed before the Ninth
Circuit. See, e.g., Briefs of the United States in ONDA v. Dombeck,
Nos. 97-3506, 97-35112, 97-35115 (9th Cir. 1997), ONDA v. USFS, No.
08-35205 (9th Cir. 2008).
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EPA is finalizing the text at Sec. 121.2, including the phrase
``from a point source,'' because it is consistent with the case law
discussed above and the Agency's longstanding approach, and because it
provides greater clarity about the nature of discharges that trigger
the need for section 401 certification or waiver. However, just as the
Agency is not defining in regulation the term ``discharge'' for
purposes of section 401, the Agency is not providing a distinct
definition of the term ``point source.'' Rather, the Agency will
continue to rely on the definition of ``point source'' in section
502(14) of the CWA.\38\ For example, courts have concluded that
bulldozers, mechanized land clearing machinery, and similar types of
equipment used for discharging dredge or fill material are ``point
sources'' for purposes of the CWA. See, e.g., Avoyelles Sportsmen's
League v. Marsh, 715 F.2d 897 (5th Cir. 1983); United States v.
Larkins, 657 F. Supp. 76 (W.D. Ky. 1987), aff'd, 852 F.2d 189 (6th Cir.
1988). On the other hand, courts have concluded that a water withdrawal
is not a point source discharge and therefore does not require a water
quality certification.\39\
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\38\ The CWA defines point source as ``any discernible, confined
and discrete conveyance, including but not limited to any pipe,
ditch, channel, tunnel, conduit, well, discrete fissure, container,
rolling stock, concentrated animal feeding operation, or vessel or
other floating craft.'' 33 U.S.C. 1362(14).
\39\ See, e.g., North Carolina v. FERC, 112 F.3d 1175, 1187
(D.C. Cir. 1997) (holding that withdrawal of water from lake does
not constitute discharge for CWA section 401 purposes).
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Several commenters supported adding the phrase ``from a point
source'' at proposed Sec. 121.2. These commenters stated that the
change is consistent with applicable case law and the text and
structure of the CWA. In addition, these commenters appreciated that
EPA clarified that section 401 was triggered by any discharge from a
point source versus a discharge from a nonpoint source. Conversely,
other commenters opposed adding the phrase ``from a point source'' at
proposed Sec. 121.2, arguing that EPA's reliance on the definition of
point source at 33 U.S.C. 1362(14) implicitly requires the addition of
pollutants to trigger section 401 certification in contravention of SD
Warren. The commenters also asserted that it appears to conflict with
EPA's concurrent proposal that the scope of review is restored to the
``activity as a whole.'' A few commenters suggested that if EPA did not
strike the phrase ``from a point source,'' the rule should state that
certification is triggered regardless of whether the discharge from a
point source results in an addition of pollutants.
EPA disagrees with commenters asserting that the definition of
``point source'' located at 33 U.S.C. 1362(14) implicitly requires the
addition of pollutants. The CWA provides that a point source is a
conveyance ``from which pollutants are or may be discharged.'' 33
U.S.C. 1362(14) (emphasis added). Given the language of the statute, it
is reasonable for EPA to conclude that a discharge of pollutants is not
required for a conveyance to be considered a point source. The Agency
also disagrees that the requirement of a point source discharge to
trigger section 401 conflicts with the scope of review. As discussed in
section IV.E in this preamble, once there is a prerequisite potential
for a point source discharge into waters of the United States, then the
certifying authority may evaluate and place conditions on the
``activity,'' which includes consideration of water quality-related
impacts from both point sources and nonpoint sources. EPA appreciates
commenter suggestions regarding regulatory text that states that a
point source does not need to result in an addition of pollutants. EPA
is declining to add such language in the regulatory text and instead
relying on the statutory definition of ``point source.'' However, EPA
has emphasized this point throughout this section of the preamble and
will continue to do so in implementation of the final rule.
Many commenters who provided input on this topic urged EPA to
revise the regulation to include discharges from both point and
nonpoint sources.
[[Page 66570]]
These commenters stated that the term ``discharge'' as used throughout
the CWA means something broader than discharges from point sources,
citing SD Warren, given that the goal of the CWA is to ``restore and
maintain the chemical, physical and biological integrity of the
Nation's waters.'' See 33 U.S.C. 1251(a). The commenters asserted that
revising the regulation to include discharges from nonpoint sources
will ensure that states and Tribes are able to exercise their section
401 authority to protect water quality from federally licensed or
permitted activities that would result in a nonpoint source discharge.
One commenter encouraged the Agency to use the statutory language in
section 401(a)(1) to describe the type of activity that triggers 401
and asserted that limiting discharges to point sources has no basis in
the statutory text, while another commenter asserted that the Federal
Government and the Supreme Court recognized that all discharges trigger
section 401.
The Agency disagrees that the term ``discharge'' as used in CWA
section 401 means something broader than discharges from point sources
or that it has no basis in the statutory text. As discussed above, the
ONDA court held that the ``term `discharge' in [section 401] is limited
to discharges from point sources.'' Id. at 1097. EPA also disagrees
that the Federal Government has recognized that all discharges trigger
section 401. As noted above, this was the Federal Government's position
before the Ninth Circuit in ONDA, see footnote 37, and EPA has
consistently implemented this view in rulemaking, guidance, and through
its actions pursuant to CWA section 401. EPA emphasizes that this final
rule does not prevent or limit certifying authorities from protecting
their water quality from federally licensed or permitted activities
that would result in nonpoint source discharges. See 33 U.S.C. 1370.
With respect to using section 401 certifications to address nonpoint
source discharges, certifying authorities may consider water quality-
related impacts from nonpoint source discharges after determining that
the project satisfies the prerequisite potential for a point source
discharge into waters of the United States.
d. ``Into the Navigable Waters''
Consistent with the 2020 Rule and proposal, the final rule provides
that section 401 certification is required for Federal licenses or
permits that authorize any activity which may result in any discharge
from a point source into waters of the United States.\40\ 40 CFR 121.2.
Section 401 states that certification is required for any activity that
``may result in any discharge into the navigable waters.'' 33 U.S.C.
1341(a)(1). The term ``navigable waters'' is defined as ``waters of the
United States, including the territorial seas.'' 33 U.S.C. 1362(7).
Requiring section 401 certification for any federally licensed or
permitted activity that may result in any discharge into waters of the
United States is consistent with the plain language of section
401(a)(1) and legislative history of the CWA. See H.R. Rep. No. 91-911,
at 124 (1972) (``It should be clearly noted that the certifications
required by section 401 are for activities which may result in any
discharge into navigable waters.''). This reading is also consistent
with the Agency's longstanding position and practice. See, e.g., 2010
Handbook at 3, 5 (rescinded in 2019, see supra) (``Since [section] 401
certification only applies where there may be a discharge into waters
of the [United States], how states or tribes designate their own waters
does not determine whether [section] 401 certification is required.'').
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\40\ In County of Maui, Hawaii v. Hawaii Wildlife Fund, et al.,
the Supreme Court addressed the question of whether the CWA requires
a NPDES permit under section 402 of the Act when pollutants
originate from a point source and travel through groundwater before
reaching navigable waters. 140 S. Ct. 1462 (2020). The Court held
that ``the statute requires a permit when there is a direct
discharge from a point source into navigable waters or when there is
the functional equivalent of a direct discharge.'' Id. at 1476
(emphasis in original). The Court articulated several factors that
may prove relevant for purposes of determining whether a section 402
permit is required. Id. at 1476-77. Consistent with the rationale of
the Court's decision in County of Maui, any point source discharge
that is the functional equivalent of a direct discharge to navigable
waters would also trigger section 401 if a Federal agency issues the
applicable license or permit.
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Potential discharges into state or Tribal waters that are not
``waters of the United States'' do not trigger the requirement to
obtain section 401 certification. However, as discussed in section IV.E
in this preamble, the Agency concludes that while a certifying
authority is limited to considering impacts to ``waters of the United
States'' when certifying compliance with the enumerated provisions of
the CWA, a certifying authority is not so limited when certifying
compliance with requirements of state or Tribal law that otherwise
apply to waters of the state or Tribe beyond waters of the United
States.
3. Implementation
Although the Agency is not providing an exclusive list of all
Federal licenses or permits subject to section 401, EPA recognizes that
there is an array of licenses and permits that may trigger the need to
seek certification. These may include, but are not limited to, CWA
section 404 permits issued by the Corps for the discharge of dredge or
fill material, Rivers and Harbors Act section 10 permits issued by the
Corps for construction of wharfs, piers, etc., Rivers and Harbors Act
section 9 permits issued by the Corps (for the construction of dams and
dikes) and the Coast Guard (for construction of bridges and causeways),
FERC licenses for the construction and operation of non-Federal
hydropower projects, FERC certificates for the construction and
operation of interstate natural gas pipeline projects, shoreline
permits issued by the Tennessee Valley Authority for shoreline
construction activities, EPA-issued CWA section 402 permits for the
discharge of pollutants, nuclear power plant licenses issued by Nuclear
Regulatory Commission, permits for wineries and distilleries issued by
the Alcohol and Tobacco Tax and Trade Bureau, and mine plans of
operation for mining activities on National Forest Service Lands
approved by the Forest Service. See also Economic Analysis for the
Final Rule at section 3.4. As discussed above, the operative question
is whether the federally licensed or permitted activity may result in
any discharge into waters of the United States.
Section 401 is not limited to individual Federal licenses or
permits, but also extends to general Federal licenses and permits such
as CWA section 404 general permits (including Nationwide General
Permits, Regional General Permits, and State Programmatic General
Permits) and CWA section 402 general permits (including the Pesticide
General Permit, Multi-Sector General Permit for stormwater discharges
associated with industrial activity, and the Construction General
Permit for stormwater discharges associated with construction
activity). Several commenters requested clarification that the section
401 certification process only applies to individual Federal licenses
or permits. Another commenter said that it is not clear how the
proposed rule would apply to nationwide permits and state programmatic
permits, and further suggested that these permits be exempted from the
rule. EPA disagrees with these comments. General Federal licenses or
permits that may result in a discharge into waters of the United States
are subject to the same requirements under section 401 as an
[[Page 66571]]
individual Federal license or permit. Section 401 does not provide an
exemption for any Federal licenses or permits that may result in a
discharge into waters of the United States. Additionally, both case law
and prior Agency rulemakings and guidance recognize that general
Federal licenses or permits are subject to section 401 certification.
See U.S. v. Marathon Development Corp., 867 F.2d 96, 100 (1st Cir.
1989) (``Neither the language nor history of section 404(e) of the
Clean Water Act . . . suggests that states have any less authority in
respect to general permits than they have in respect to individual
permits.''); 40 CFR 121.5(c), 121.7(d)(2) and (e)(2) (2020) (describing
requirements for certification on the issuance of a general license or
permit); 2010 Handbook at 29-30 (rescinded in 2019, see supra)
(discussing the application of section 401 to general permits).
Accordingly, EPA cannot adopt commenter suggestions to exempt general
permits from the certification process.
Several commenters requested that EPA affirmatively state that the
section 401 certification process does not apply to ``verifications''
of Federal general permit actions; instead, commenters suggested that
the certification process should occur at the time the Federal general
permit is issued. Federal agencies seek certification on general
permits before the permits are issued. Accordingly, final rule Sec.
121.5 provides the minimum content requirements for all requests for
certification, including certification for the issuance of a general
Federal license or permit. If a certifying authority grants or waives
certification for either a CWA section 402 or 404 general permit, then
entities seeking coverage under that general permit do not need to
separately seek certification before doing so. When a certifying
authority denies certification on a section 402 general permit, EPA can
issue the general permit for the jurisdictions that granted or waived
certification but cannot issue the permit for jurisdictions that denied
certification.\41\ If a certifying authority grants certification with
conditions on an EPA-issued general permit, then the certification with
conditions becomes part of the general permit applicable within the
certifying authority's jurisdiction.
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\41\ If a certifying authority denies certification on an EPA-
issued NPDES general permit, dischargers could always apply for an
individual NPDES permit. That individual permit would also require a
401 certification.
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When a certifying authority denies certification for a CWA section
404 Nationwide or Regional General Permit, the Corps allows specific
projects to be covered by the Nationwide or Regional General Permit if
the project proponent obtains certification from the certifying
authority for that project. In that instance, a project proponent would
submit a request for certification in accordance with final rule Sec.
121.5 for individual Federal licenses or permits. When a certifying
authority grants certification with conditions on a Nationwide or
Regional General Permit, the Corps may either incorporate the
conditions into a state- or Tribe-specific version of the general
permit or require the project proponent to obtain certification from
the certifying authority for that project to qualify for the general
permit.
As discussed above, section 401 is triggered by a potential point
source discharge from a federally licensed or permitted activity into
waters of the United States. A few commenters recommended that the
Agency explicitly acknowledge that point sources include discharges
from CWA section 404 dredge and fill activities (e.g., equipment,
construction activities) in the regulatory text. Considering the broad
applicability of section 401 to all Federal licenses or permits, the
Agency does not find it necessary to focus the regulatory text on point
sources from one type of federally licensed or permitted activity.
Rather, the Agency intends to rely on the definition of point source at
33 U.S.C. 1362(14), which defines point source as ``any discernible,
confined and discrete conveyance . . . from which pollutants are or may
be discharged.'' As emphasized above, a point source does not require
the addition of pollutants, but rather is a conveyance from which
pollutants are or may be discharged. For example, a point source
includes the turbine or tailrace of a hydroelectric dam, and bulldozers
or other construction equipment. In both instances, the equipment
(e.g., turbine, bulldozer) acts as a discernable, confined, or discrete
conveyance that pollutants could be discharged from, but the addition
or existence of such pollutants is not necessary for the equipment to
be considered a point source.
B. Pre-Filing Meeting Request
1. What is the Agency finalizing?
EPA is finalizing the requirement that ``[t]he project proponent
shall request a pre-filing meeting with the certifying authority at
least 30 days prior to submitting a request for certification in
accordance with the certifying authority's applicable submission
procedures, unless the certifying authority waives or shortens the
requirement for the pre-filing meeting request.'' 40 CFR 121.4. This
requirement will ensure that certifying authorities have an
opportunity, should they desire it, to receive early notification and
to discuss the project with the project proponent before the statutory
timeframe for review begins. If a certifying authority does not
communicate whether it wants to waive or shorten the pre-filing meeting
request requirement, then the project proponent must wait 30 days from
requesting a pre-filing meeting to submit its request for
certification. The Agency is not defining the ``applicable submission
procedures'' or other procedural aspects of a pre-filing meeting
request or subsequent meeting. Accordingly, the Agency is finalizing
the removal of the 2020 Rule's recommendations for pre-filing meetings.
See 40 CFR 121.4(c) and (d) (2020). The Agency is also finalizing the
removal of regulatory text discussing the certifying authority's
obligations in response to a pre-filing meeting request because the
final rule does not compel any action by the certifying authority. See
40 CFR 121.4(b) (2020).
2. Summary of Final Rule Rationale and Public Comment
The 2020 Rule introduced the pre-filing meeting request requirement
to encourage early coordination between parties to identify needs and
concerns before the start of the reasonable period of time. EPA
interpreted the term ``request for certification'' in CWA section
401(a)(1) as being broad enough to include an implied requirement that
a project proponent shall also provide the certifying authority with
advance notice that a certification request is imminent. The time (no
longer than one year) that certifying authorities are provided under
the CWA to act on a certification request (or else waive the
certification requirements of section 401(a)) provided additional
justification in this context to interpret the term ``request for
certification'' to allow EPA to require a pre-filing meeting request.
The 2020 Rule proposal originally limited the pre-filing meeting
request requirement to project proponents seeking certification in
jurisdictions where EPA acts as the certifying authority. However, in
response to stakeholder feedback on the proposed 2020 Rule, the Agency
extended the pre-filing meeting request requirement to all project
proponents. As a result, the final 2020 Rule required all project
proponents to request a pre-filing meeting at least 30 days prior to
submitting a water quality certification
[[Page 66572]]
request. 85 FR 42241 (July 13, 2020). The 2020 Rule did not provide any
mechanism for certifying authorities to waive or otherwise alter the
30-day period between a project proponent requesting a pre-filing
meeting and subsequently submitting a certification request. Instead,
there was a mandatory 30-day period that had to pass before the project
proponent could submit a certification request.
During pre-proposal outreach on this rulemaking, some stakeholders
found the pre-filing meeting request requirement to be essential to an
efficient certification process, while others expressed concern about
the mandatory 30-day ``waiting period'' between the pre-filing meeting
request and the certification request, particularly in emergency permit
situations. Stakeholders suggested that EPA should add flexibility to
the process and give certifying authorities the ability to waive the
pre-filing meeting request (e.g., for smaller and less complex projects
and emergencies). In response to pre-proposal input, the Agency
proposed to retain a pre-filing meeting request provision with
modifications to provide certifying authorities the flexibility to
waive or shorten this requirement.
Many commenters recognized that pre-filing meetings have the
potential to facilitate and help streamline the certification process
through early coordination. Conversely, other commenters expressed
concern that the pre-filing meeting request requirement creates delays
and administrative burden. Some commenters said that, in lieu of an
actual requirement, EPA should only encourage pre-filing meeting
requests. Several commenters supported the flexibility included in the
proposed rule giving certifying authorities the ability to waive or
shorten the requirement.
After considering public comment, EPA is finalizing the pre-filing
meeting request requirement as proposed, with minor, non-substantive
revisions. EPA finds that the final rule's approach to the pre-filing
meeting request requirement both facilitates early coordination in the
certification process while recognizing that states and Tribes are in
the best position to determine whether a particular project (or class
of projects) would benefit from such early coordination. Accordingly,
this final rule enables a certifying authority to shorten or waive the
pre-filing meeting request requirement on a case-by-case or categorical
basis. For example, certifying authorities may categorically waive or
shorten the pre-filing meeting request requirement for less complex,
routine projects, as these projects most likely would not benefit from
early engagement between the project proponent and certifying authority
as large, complex projects would. This flexibility reflects both
cooperative federalism principles and the reality that not every
project will meaningfully benefit from a pre-filing meeting. EPA
encourages certifying authorities to make their requests for
certification requirements and the applicable submission procedures
transparent to project proponents, especially in instances where the
pre-filing meeting request requirement was waived, so that submission
of the request for certification goes smoothly in cases where there is
no early coordination through the pre-filing meeting process.
EPA requested comment on whether it should define the pre-filing
meeting request process and ``applicable submission procedures'' for
other certifying authorities in regulatory text. A few commenters
stated that there should be procedures for the pre-filing meeting
requests to increase clarity and consistency, including a list of
minimum information to include in the meeting request. Other commenters
opposed the idea of EPA setting procedures for pre-filing meetings to
maintain flexibility. EPA finds that certifying authorities are best
equipped to determine their procedures and needs for pre-filing
meetings and requests. Like the approach taken under the 2020 Rule, EPA
is not defining the process or manner to submit pre-filing meeting
requests. Rather, EPA intends the term ``applicable submission
procedures'' to mean the submission procedures deemed appropriate by
the certifying authority. See infra for discussion on EPA's applicable
submission procedures when EPA acts as the certifying authority. The
Agency is also not defining a pre-filing meeting process (e.g.,
identifying meeting subject matter or meeting participants) nor
retaining the 2020 Rule's recommendations for pre-filing meetings. In
the 2020 Rule, the Agency ``encouraged'' but did not require the
project proponent and the certifying authority to take certain steps
with respect to the pre-filing meeting process. See 40 CFR 121.4(c) and
(d) (2020). The Agency is removing these recommendations from the
regulatory text because (1) they were not expressed as, or intended to
be, regulatory requirements, and (2) certifying authorities and project
proponents are best suited to determine the optimal pre-filing meeting
process on a project-by-project, project type, or general basis.
EPA also requested comment on whether it should specify that all
certifying authorities should respond with written acknowledgement and
determination of the need for a pre-filing meeting and timeline within
five days of receipt of the pre-filing meeting request. Many commenters
suggested that certifying authorities should be required to provide a
written response within five days informing the project proponent if a
pre-filing meeting is needed. The Agency is not adding a requirement
that a certifying authority must respond in writing within five days of
receipt of the pre-filing meeting request. Instead, similar to the 2020
Rule, this final rule does not require certifying authorities to grant
or respond to a pre-filing meeting request. See 40 CFR 121.4(b) (2020).
However, the Agency is finalizing removal of the 2020 Rule provision
stating that the certifying authority is not obligated to grant or
respond to a pre-filing meeting request because the regulatory text at
Sec. 121.4 does not compel any action by the certifying authority.
Accordingly, the Agency does not find it necessary to expressly
reiterate what the certifying authority is not obligated to do. If a
certifying authority fails to communicate whether it wants to waive or
shorten the pre-filing meeting request requirement, then the project
proponent must wait 30 days from requesting a pre-filing meeting to
submit its request for certification. Generally, EPA expects that it
will provide written acknowledgement that the pre-filing meeting
request has been received within five days of receipt. In its written
response, the Agency will also state whether it has determined that the
pre-filing meeting will be waived or when (if less than 30 days) the
project proponent may submit the certification request.
EPA requested comment on whether project proponents should have the
opportunity to participate in determining the need for a pre-filing
meeting request. Some commenters argued that the project proponent
should be involved in determining the need for a pre-filing meeting.
After considering public comments, EPA is not requiring the
participation of the project proponent when determining the need for a
pre-filing meeting request. However, the Agency encourages certifying
authorities to engage with project proponents early in the process as
they can inform decisions based on their knowledge of the project.
3. Implementation
Pre-filing meeting requests ensure that certifying authorities can
receive early notification of requests for certification and discuss
the project and potential
[[Page 66573]]
information needs with the project proponent before the statutory
``reasonable period of time'' for certification review begins (e.g.,
they allow the certifying authority to collect important details about
a proposed project and its potential effects on water quality). The
intent of the pre-filing meeting request provision is to support early
engagement and coordination between certifying authorities and project
proponents as needed. However, EPA recognizes that there are various
project types and complexities. Accordingly, this final rule provides
certifying authorities with the flexibility to waive or shorten the
requirement on a case-by-case or categorical basis. For example,
certifying authorities could either require or waive the pre-filing
meeting request requirement for all projects, specific types of
projects (e.g., projects under 300 linear feet), or types of Federal
licenses or permits (e.g., general permits). EPA recommends that
certifying authorities clearly communicate to project proponents their
expectations for pre-filing meetings requests and waivers (e.g.,
whether they may grant waivers, either categorically or on an
individual basis, and any procedures and/or deadlines for submission of
requests and the grant of waivers) so that project proponents may
clearly and efficiently engage in the certification process. EPA also
recommends that certifying authorities make this information readily
available to project proponents in an easily accessible manner to allow
for a transparent and efficient process (e.g., posting a list of
project types that require a pre-filing meeting request on the
certifying authority's website).
Additionally, the final rule allows certifying authorities to
determine appropriate submission procedures for pre-filing meeting
requests. When EPA acts as the certifying authority, EPA would
generally find the following submission procedures to be appropriate.
First, EPA recommends that project proponents submit a pre-filing
meeting request to the Agency in writing.\42\ Second, the Agency
recommends that project proponents include the following information,
as available, in any written request for a pre-filing meeting with EPA:
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\42\ Under final rule Sec. 121.5(b)(7), a project proponent
must submit documentation that a pre-filing meeting was requested,
unless the pre-filing meeting request requirement was waived. See
section IV.C in this preamble for further discussion on the contents
of a request for certification when EPA is acting as the certifying
authority.
1. A statement that it is ``a request for CWA section 401
certification pre-filing meeting,''
2. The name of the project proponent and appropriate point of
contact,
3. The name of the Tribe or jurisdiction for which EPA is
serving as the certifying authority,
4. The planned project location (including identification of
waters of the United States into which any potential discharges
would occur),
5. A list of any other necessary licenses/permits (e.g., state
permits, other Federal permits, etc.),
6. The project type and a brief description of anticipated
project construction and operation activities, and
7. The anticipated start work date.
These are good practices for any pre-filing meeting requests to any
certifying authority.
The final rule allows certifying authorities flexibility to
determine the procedures and content of pre-filing meetings. EPA,
however, encourages project proponents and certifying authorities to
use the pre-filing meeting to discuss the proposed project, as well as
determine what information or data is needed (if any) as part of the
request for certification to enable the certifying authority to take
final action on the request for certification within the reasonable
period of time. During the pre-filing meeting, project proponents could
share a description and map of the proposed project location and
timeline, as well as discuss potential water quality-related impacts
from the activity. Certifying authorities could use the meeting as an
opportunity to provide information on how to submit requests for
certification (e.g., discuss procedural requirements for submission of
a request for certification). Certifying authorities should also
consider including the Federal agency in the pre-filing meeting process
for early coordination where the Federal agency is not otherwise
legally precluded. Additionally, the final provision provides
flexibility for the certifying authority to determine whether the pre-
filing meeting request requirements are fulfilled by any pre-
application meetings or application submissions to the Federal
licensing or permitting agency. Generally, EPA recommends that
certifying authorities provide clear expectations for pre-filing
meetings to ensure they are used efficiently and effectively.
C. Request for Certification
1. What is the Agency finalizing?
At Sec. 121.5(a), EPA is requiring that all requests for
certification be in writing, signed, and dated and include defined
minimum contents. Unlike the proposed rule, which required a copy of
the draft Federal license or permit for all requests for certification,
the Agency is bifurcating the minimum content requirements for an
individual Federal license or permit and the issuance of a general
Federal license or permit. Under the final rule, if the request for
certification is for an individual Federal license or permit, the
request for certification must include a copy of the Federal license or
permit application and any readily available water quality-related
materials that informed the development of the application. If the
request for certification is for the issuance of a general Federal
license or permit, then the request for certification must include a
copy of the draft Federal license or permit and any readily available
water quality-related materials that informed the development of the
draft Federal license or permit. For all requests for certification,
the final rule requires a certifying authority to send written
confirmation to the project proponent and Federal agency of the date
that a request for certification is received by the certifying
authority in accordance with its applicable submission procedures.
Additionally, the final rule provides that where a project
proponent is seeking certification from EPA when the Agency is the
certifying authority, or from a state or authorized Tribe that does not
specify additional contents of a request for certification (e.g.,
through regulation, forms, etc.), the project proponent must also
submit seven additional components, as applicable, including: (1) A
description of the proposed activity, including the purpose of the
proposed activity and the type(s) of discharge(s) that may result from
the proposed activity; (2) The specific location of any discharge(s)
that may result from the proposed activity; (3) A map or diagram of the
proposed activity site, including the proposed activity boundaries in
relation to local streets, roads, and highways; (4) A description of
current activity site conditions, including but not limited to relevant
site data, photographs that represent current site conditions, or other
relevant documentation; (5) The date(s) on which the proposed activity
is planned to begin and end and, if known, the approximate date(s) when
any discharge(s) may commence; (6) A list of all other Federal,
interstate, Tribal, state, territorial, or local agency authorizations
required for the proposed activity and the current status of each
authorization; and (7) Documentation that a pre-filing meeting request
was submitted to the certifying authority in accordance with applicable
submission procedures, unless the pre-filing
[[Page 66574]]
meeting request requirement was waived. 40 CFR 121.5(b).
The Agency is also finalizing the ability for state or Tribal
certifying authorities to define the additional contents of a request
for certification in regulation or another appropriate manner, such as
an official form used for requests for certification, in lieu of
relying on EPA's default list of additional contents. Therefore, under
this final rule, where a project proponent is requesting certification
from a certifying authority other than EPA and that certifying
authority has identified additional required contents of a request for
certification beyond the minimum contents outlined in 40 CFR 121.5(a),
then the request for certification must include those additional
required contents.
The Agency restructured Sec. 121.5 to clarify which components are
required for all requests for certification versus which components
depend on the certifying authority. Section 121.5(a) defines the
minimal contents for all requests for certification, no matter the
certifying authority (i.e., states, Tribes, or EPA). Section 121.5(b)
defines the additional contents in a request for certification when EPA
is the certifying authority. Section 121.5(c) clarifies that if the
certifying authority is a state or authorized Tribe that has identified
additional contents for a request for certification, then the project
proponent must include those additional contents in a request for
certification. Lastly, Sec. 121.5(d) clarifies that if the certifying
authority is a state or authorized Tribe that has not identified
additional contents for a request for certification, then the project
proponent must include those additional contents defined at Sec.
121.5(b) in a request for certification. This structural change is
intended to provide greater clarity for stakeholders in implementation
of this final rule.
2. Summary of Final Rule Rationale and Public Comment
Section 401(a)(1) provides that the certifying authority's
reasonable period of time to act starts after a certifying authority is
in ``receipt'' of a ``request for certification'' from a project
proponent. 33 U.S.C. 1341(a) (``If the State, interstate agency, or
Administrator, as the case may be, fails or refuses to act on a request
for certification, within a reasonable period of time (which shall not
exceed one year) after receipt of such request, the certification
requirements of this subsection shall be waived with respect to such
Federal application.'') (emphasis added). The statute does not define
either ``request for certification'' or ``receipt.''
In the 2020 Rule, the Agency defined ``certification request'' for
all certifying authorities and asserted that ambiguities in the
statutory language had led to inefficiencies in the certification
process. 40 CFR 121.5 (2020); see 85 FR 42243 (July 13, 2020). In
particular, the 2020 Rule preamble provided that states and authorized
Tribes could not rely on state or tribally defined ``complete
applications'' to start the certification process, but rather must rely
on a certification request as defined in EPA's regulation to initiate
the process. The Agency relied on New York State Department of
Environmental Conservation v. FERC, in which the Court of Appeals for
the Second Circuit rejected New York's argument that the section 401
process ``begins only once [the state agency] deems an application
`complete' '' and, instead, agreed with FERC that the section 401
review process begins when the state receives a request for
certification. 884 F.3d 450, 455 (2d Cir. 2018) (``NYSDEC''). The court
found that ``[t]he plain language of Section 401 outlines a bright-line
rule regarding the beginning of review'' and reasoned that ``[i]f the
statute required `complete' applications, states could blur this
bright-line rule into a subjective standard, dictating that
applications are `complete' only when state agencies decide they have
all the information they need.'' Id. at 455-56.
Some commenters asserted that the 2020 Rule's approach provided
clarity about the requirements for project proponents to request
certification and when the reasonable period of time begins. These
commenters stated that the 2020 Rule created a predictable and
transparent certification process by defining a clear list of contents
of certification requests. Conversely, some commenters highlighted
challenges with implementing the 2020 Rule's approach for certification
requests. Commenters stated that 2020 Rule requirements were
disconnected from longstanding cooperative processes established among
stakeholders and created confusion due to differences from certifying
authorities' requirements.
EPA agrees that defining some minimum components of a request for
certification increases clarity and efficiency in the certification
process. Recognizing that some certifying authorities already have or
will define additional requirements for requests for certification they
receive, EPA is only defining minimum contents for all requests for
certification. EPA finds this approach best respects longstanding state
and Tribal processes familiar to stakeholders and enables states and
Tribes to determine their specific information needs. EPA is also
finalizing additional contents for requests for certification to EPA or
states and Tribes that fail to define such additional contents to
provide stakeholders with greater certainty and predictability in the
certification process. The final rule establishes an approach that
provides efficiency for requests for certification, while staying
consistent with cooperative federalism principles and case law.
EPA is also finalizing conforming changes to the part 124
regulations governing the contents of a request for certification of
EPA-issued NPDES permits. EPA proposed to delete Sec. 124.53(b)
because the provision allowed a request for certification to precede
development of a draft NPDES permit, which was inconsistent with the
proposed rule. EPA also proposed to delete Sec. 124.53(c) because the
list of contents at Sec. 124.53(c) differed from the proposed list of
contents. See 87 FR 35336-57 (June 9, 2022). In light of changes in the
final rule, EPA is not deleting in full Sec. 124.53(b) or (c), and
instead is making targeted revisions to be consistent with the final
rule. First, EPA is revising 40 CFR 124.53(b), which provided that when
EPA received a permit application without certification, EPA shall
forward the application to the certifying authority with a request that
certification be granted or denied. EPA is revising Sec. 124.53(b) to
clarify that EPA may forward permit applications for individual NPDES
permits to a certifying authority and request certification consistent
with final rule Sec. Sec. 121.4 and 121.5 (e.g., EPA will request a
pre-filing meeting and include contents for a request for certification
consistent with this final rule). It is worth noting that although
Sec. 124.53(b) allows EPA to request certification on a permit
application for individual permits (consistent with this final rule),
this approach is not common practice. Under the final rule and Sec.
124.53(c), EPA may continue to request certification after the draft
individual or general NPDES permit is prepared (and include a copy of
draft permit in the request for certification). Nevertheless, EPA is
retaining Sec. 124.53(b) with the revisions discussed above to provide
stakeholders and EPA with flexibility to request certification prior to
developing a draft individual NPDES permit.
Second, EPA is also revising 40 CFR 124.53(c), which identified the
required contents of a request for certification of an EPA-issued NPDES
permit if a certification had not been received by the time the draft
permit is prepared.
[[Page 66575]]
EPA is revising Sec. 124.53(c) to specify that if certification has
not been requested by the time a draft NPDES permit is prepared, EPA
will send a request for certification consistent with final rule Sec.
121.5, and will include a copy of the draft permit with that request.
EPA is finalizing deletions of the required contents of a request for
certification in Sec. 124.53(c)(2) and (3) because the list of
contents at Sec. 124.53(c)(2) and (3) differ from the list of contents
in Sec. 121.5. Also, as explained in section IV.D in this preamble,
the statement required at Sec. 124.53(c)(3) regarding the reasonable
period of time was not consistent with the approach to the reasonable
period of time at Sec. 121.6.
The following sections discuss the minimum contents for all
requests for certification, state and Tribal authority to define
additional contents, the additional contents defined by EPA and their
application in instances where states and Tribes decline to define such
additional contents, and when a certifying authority is in ``receipt''
of a request for certification.
a. Minimum Contents of a Request for Certification
i. Application or Draft Federal License or Permit
In a change from the proposed rule, EPA is finalizing that all
requests for certification on an individual Federal license or permit
shall include ``[a] copy of the Federal license or permit application
submitted to the Federal agency,'' while all requests for certification
on the issuance of a general Federal license or permit shall include
``[a] copy of the draft Federal license or permit.'' 40 CFR 121.5(a).
EPA proposed in Sec. 121.5(a) that all requests for certification
``shall include a copy of the draft license or permit'' to ensure that
states and Tribes have the critical information to make a timely and
informed certification decision. 87 FR 35332. Many commenters opposed
this approach for various reasons, including but not limited to
possible impacts to certifying authority practice and relationships,
concerns over potential delays, and concerns over how the proposed
approach would work in instances where a Federal agency does not
develop a draft license or permit, particularly for individual Federal
licenses or permits.
In response to comments, EPA decided to partially change the
requirement in the final rule to require that all requests for
certification on an individual Federal license or permit include the
Federal license or permit application at a minimum, instead of the
draft Federal license or permit. See 40 CFR 121.5(a)(1). EPA recognizes
that with respect to general Federal licenses and permits, there often
is no formal ``application,'' and for that reason the final rule allows
the Federal agencies issuing those general Federal licenses and permits
to submit the draft general Federal license or permit to the certifying
authority instead of a Federal license or permit ``application.'' See
40 CFR 121.5(a)(2). EPA's bifurcated approach for requests for
certification for individual Federal licenses or permits and for the
issuance of general Federal licenses or permits promotes clarity and
should minimize delays in the licensing and permitting process, since
EPA anticipates most stakeholders are familiar with starting the
section 401 certification process with a Federal license or permit
application (for individual licenses or permits) or with a copy of the
draft Federal license or permit (for the issuance of a general license
or permit). Additionally, this bifurcation is modeled on the separate
lists for the contents of requests for certification included in the
2020 Rule.
ii. Water Quality-Related Materials
In the final rule, EPA is requiring project proponents to include
``any readily available water quality-related materials that informed
the development of the application'' for requests for certification for
individual Federal licenses or permits. See 40 CFR 121.5(a)(1)(ii). In
the case that the request for certification is for the issuance of a
general Federal license or permit, it must include ``any readily
available water quality-related materials that informed the development
of the draft Federal license or permit.'' See 40 CFR 121.5(a)(2)(ii).
The term ``readily available water quality-related materials that
informed the development of'' either the application or the draft
license or permit refers to existing water quality-related materials
that are in the project proponent's possession or easily obtainable
\43\ and informed the project proponent's development of the
application or draft license or permit. These materials for either
request may include, but are not limited to, water quality baseline
conditions from the project site, sediment and erosion control plans,
restoration plans, alternatives analyses, mitigation plans, modeling,
and/or other materials that have already been developed for the Federal
license or permit application or draft license or permit and would help
inform the certifying authority of the water quality-related impacts
from the activity.\44\
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\43\ For example, this could include maps, studies, or a
reference to a website or literature that contain information that
informed the development of the application or draft license or
permit.
\44\ These examples are not intended to be exhaustive, nor does
EPA expect that all of the example materials listed will be readily
available and/or materials that informed the develop of the
application or draft Federal license or permit in all cases. Rather,
EPA is providing these examples because these are materials that EPA
has previously asked for and found informative when conducting its
reviews of requests for certification.
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The Agency had proposed that, at a minimum, all requests for
certification include ``any existing and readily available data or
information related to potential water quality impacts from the
proposed project.'' EPA intended that providing certifying authorities
with any existing and readily available data or information related to
potential water quality impacts from the proposed project, such as
studies or an EIS or Environmental Assessment (EA) or other water
quality monitoring data, would reduce the need for duplicative studies
and analyses. Several commenters supported the requirement that the
request for certification include ``any existing and readily available
data or information related to potential water quality impacts from the
proposed project,'' and a few commenters noted that this information is
important for decision-making and allows certifying authorities to
better evaluate potential impacts of a project. Conversely, many
commenters did not support the inclusion of ``any existing and readily
available data or information related to potential water quality
impacts from the proposed project,'' arguing that it was unclear and
would be difficult to implement. Some of these commenters added that
the requirement would create confusion and delays in the certification
process.
In response to commenter concerns, EPA is adjusting the regulatory
text in the final rule to read ``any readily available water quality-
related materials that informed the development of'' the application or
draft general Federal license or permit. See 40 CFR 121.5(a)(1)(ii),
(a)(2)(ii). EPA recognizes the importance of providing certifying
authorities with critical information to inform their analysis while at
the same time considering important implementation details. First, this
revision provides a predictable endpoint for project proponents because
it is limited to existing data or information that was used in the
development of the Federal license or permit application or the draft
general Federal license or permit. Second, consistent with the
[[Page 66576]]
scope of review under this final rule, this revision limits any such
materials to ``water quality-related materials.'' This will ensure that
project proponents provide certifying authorities with pertinent water
quality-related information to fully inform their certification
analysis. EPA also finds that limiting such materials to ``water
quality-related'' should clarify that project proponents may redact or
exclude personally identifiable information (e.g., personal addresses,
personal finance information) and/or other sensitive information.
A few commenters asserted that while they supported the minimum
requirements of the proposed rule, they believed that the Agency should
not limit certifying authorities to ``any existing and readily
available'' and suggested deleting the phrase or clarifying that it
should not be construed to restrict a certifying authority from
requesting new, additional, or not-yet available data related to the
proposed activity. EPA appreciates these concerns, however, as
discussed above, the Agency finds it reasonable and appropriate for the
rule to balance certifying authority information needs with legitimate
implementation concerns by limiting the default requirements to
existing, readily available information. However, if there are other
materials that did not necessarily ``inform the development'' of the
application or draft Federal license or permit (e.g., section 402
permit factsheets, permit description presentations, etc.), the
certifying authority is free to define such materials in its additional
contents for a request for certification, see discussion infra, or
request such additional information after receiving a request for
certification. A project proponent may also include any additional
information in the request for certification. Furthermore, certifying
authorities are encouraged to use the pre-filing meeting request
process to further communicate appropriate water quality-related
materials that would be helpful in reviewing a request for
certification on an individual Federal license or permit.
b. Additional Contents in a Request for Certification
Consistent with the proposed rule, EPA is finalizing that where a
``certifying authority has identified contents of a request for
certification'' that are relevant to the water quality-related impacts
from the activity, in addition to the minimum requirements discussed
above, ``the project proponent shall include in the request for
certification those additional contents identified prior to when the
request for certification is made.'' 40 CFR 121.5(c). The Agency is
also finalizing a set of additional contents that a project proponent
must include in a request for certification when EPA acts as the
certifying authority. 40 CFR 121.5(b). For further clarity, the
additional contents listed at Sec. 121.5(b) are required in each
request for certification to a state or authorized Tribe that has not
established its own list of requirements. If a state or authorized
Tribe has established its own list for a request for certification,
then EPA's list of additional contents would not apply. The Agency has
restructured Sec. 121.5 to clearly distinguish between requirements
that apply to all requests for certification, see Sec. 121.5(a),
versus requirements that only apply to requests for certification to
EPA or states or Tribes that fail to define additional contents, see
Sec. 121.5(b) and (d), or requirements that apply to requests for
certification to states or Tribes that define additional contents, see
Sec. 121.5(c).
EPA acknowledges that this final rule's approach contrasts with the
approach taken in the 2020 Rule, which defined the contents of a
certification request for all certifying authorities. However, this
final rule is a better--and more flexible--approach to defining the
term ``request'' and consistent with NYSDEC. That decision holds that
the reasonable period of time begins after receipt of a request for
certification and not when a state deems it ``complete;'' it does not
preclude EPA or other certifying authorities from defining--in
advance--those contents a certification request must contain. As
discussed below, this approach is consistent with stakeholder input and
the cooperative federalism principles central to section 401 and the
CWA.
i. State and Tribal Certifying Authorities
Under Sec. 121.5(c), ``[w]here a project proponent is seeking
certification from a certifying authority other than the Regional
Administrator, and that certifying authority has identified contents of
a request for certification in addition to those identified in
paragraph (a) of [Sec. 121.5], the project proponent shall include in
the request for certification those additional contents identified
prior to when the request for certification is made.'' This approach is
consistent with the proposal and the intent of the Act, is reasonable,
is responsive to concerns and considerations raised through the public
comment process, and ultimately is the most efficient path forward.
Many commenters supported certifying authorities having the ability
to define the contents of a request for certification, saying that it
ensures states and Tribes have the information they need to protect
their water quality. Commenters provided a variety of reasons why they
supported this approach, including asserting that it will ensure a
comprehensive review under section 401 in the reasonable period of time
and enable states and Tribes to ensure they have needed information to
determine whether a project will comply with their water quality
requirements. Several commenters argued that this approach is an
improvement over the 2020 Rule's ``one-size fits all'' approach to
request for certification. EPA agrees that certifying authorities are
best suited for determining their needs in making their certification
decisions.
As an initial matter, the Agency finds it is reasonable for states
and Tribes to have the authority to determine what information is
necessary to initiate the certification process under section 401 in
compliance with their own water quality requirements. In order to
effectuate Congress's goals and directives for section 401 in the
limited amount of time provided by the Act, it is reasonable that
certifying authorities should be able to define what information, in
addition to a copy of the Federal license or permit application and any
water quality-related materials that informed the development of the
application, is necessary to make an informed decision regarding
protecting their water quality from adverse effects from a federally
licensed or permitted activity. Defining an exclusive list of
components for requests for certification for all certifying
authorities could inhibit a comprehensive review under section 401 in
the reasonable period of time. The diverse nature of Federal licenses
and permits and the variety of potential water quality impacts from
those different types of activities do not lend themselves to a one-
size-fits-all approach.
Indeed, to define an exclusive list of contents would frustrate the
intent of the Act's emphasis on cooperative federalism and lead to
procedural inefficiencies. Specifically, a framework requiring the
reasonable period of time to begin before the certifying authority has
essential information that it has transparently publicized as necessary
to make its own certification decision would be inconsistent with the
language, goals, and intent of the statute. Congress clearly did not
intend section 401 reviews to turn on incomplete applications, and the
[[Page 66577]]
reasonable period of time and one-year backstop were added by Congress
to ensure that ``sheer inactivity by the State . . . will not frustrate
the Federal application.'' H.R. Rep. No. 92-911, at 122 (1972).
Moreover, this approach should be familiar to project proponents who
followed specific requirements established by states and Tribes during
the last approximately 50 years. The Agency's final approach will allow
for a transparent and timely process that respects the role of state
and Tribal certifying authorities under the cooperative federalism
framework of section 401.
Some commenters opposed the proposed rule and argued that the
Agency cannot delegate the ability to define additional requirements
for a certification request to certifying authorities under NYSDEC. The
Agency does not agree. In NYSDEC, the Second Circuit never addressed
the separate question of whether EPA or certifying authorities have the
underlying authority to establish--in advance of receiving a request
for certification--a list of required contents for such a request.
Accordingly, the court's holding that the reasonable period of time
begins after ``receipt'' does not preclude the Agency from establishing
such a list of minimum ``request for certification'' requirements, or
from allowing certifying authorities to add requirements to EPA's list
or develop their own lists of request requirements. Because the statute
does not define the term ``request for certification,'' EPA and other
certifying authorities may do so in a reasonable manner that
establishes--in advance of receiving the request--a discernable and
predictable set of requirements for a request for certification that
starts the reasonable period of time. No court has considered this
issue and come to the opposite conclusion. The Agency decides,
consistent with principles of cooperative federalism enshrined in the
Act, to continue this lawful, familiar, and time-tested practice.
Most commenters that opposed this approach argued that, as an
implementation matter, EPA is inviting certifying authorities to engage
in the types of practices that were rejected by the Second Circuit in
NYSDEC. Specifically, commenters asserted that the proposed approach
would allow certifying authorities to issue regulations that expand the
required contents of a request for certification without any oversight
or limits and for reasons other than potential water quality impacts.
Other commenters asserted that the proposed approach did not enforce
any transparency requirements against certifying authorities, and,
therefore, certifying authorities would vaguely or broadly define the
minimum contents or require information that was currently unavailable
to stall the start of the reasonable period of time. Still other
commenters argued that the ability of states and authorized Tribes to
define the contents for a request for certification would result in a
patchwork of different requirements, placing burdens on project
proponents, especially for projects that span multiple states. The
Agency acknowledges these concerns and has incorporated reasonable
changes into the final rule that establish sufficient guardrails to
prevent those practices, while also allowing certifying authorities to
act on a request for certification in a timely and informed manner.
First, as identified in Sec. 121.3, the scope of the certifying
authority's review is explicitly limited in the final rule to ``the
water quality-related impacts.'' To clarify that such limitations
extend to the contents of a request for certification, EPA added text
at Sec. 121.5(c) that such additional contents are ``relevant to the
water quality-related impacts from the activity.'' Hence, contents of
requests for certification that are substantively beyond the scope of
water quality-related impacts cannot be reasonably necessary to make an
informed decision regarding the potential water quality-related impacts
from the activity, and thus would not be in conformity with the
regulation. The regulatory text provides flexibility within the scope
for certifying authorities interested in developing their own
additional contents of requests for certification.
Next, Sec. 121.5(c) itself limits the ability of a certifying
authority to request materials to those ``identified prior to when the
request for certification is made.'' Although the Agency is allowing
states and authorized Tribes to define their own additional
requirements for a request for certification, the rule provides a
backstop for those states or authorized Tribes that either do not
identify those additional requirements before the request for
certification is made or change their requirements after the request
for certification is made. In other words, certifying authorities
cannot subsequently modify or add to the required contents of a request
for certification after the request was submitted. This does not mean a
certifying authority could not ask for additional information after a
request for certification is made; rather, a certifying authority
cannot alter the required contents of a request for certification after
it is received.
The Agency expects that those states and authorized Tribes that
choose to identify additional contents in a request for certification
will do so clearly enough to provide project proponents with full
transparency as to what is required. Relatedly, to remain consistent
with legal precedent, states and authorized Tribes should avoid non-
exhaustive or vague lists that a certifying authority could rely on to
continually deem requests incomplete. When developing their lists of
additional contents in a request for certification, EPA recommends that
certifying states and authorized Tribes look to Sec. 121.5(b) for the
list of contents EPA has outlined for requests for certification when
it acts as a certifying authority as a guide to help the certifying
state or authorized Tribe develop its own list.
The Agency originally proposed that the contents of a request for
certification be established by a state or authorized Tribe in
regulation. Several commenters disagreed that certifying authorities
should be limited to defining the contents of a request for
certification in regulation. A few commenters asserted that the
contents do not need to be in a regulation to be transparent or
publicly available, while a few commenters urged EPA to consider that
some state processes are well-known to the regulated community or have
been used for 50 years. A few of these commenters argued that states
use different approaches to defining the contents of a certification
request, including statute, policy documents, application forms, and
guidance. These commenters asserted that placing the contents of a
request in regulation would be an unnecessary burden, time consuming
(e.g., may require legislative approval before going into effect), and
interfere with a state's ability to describe the information in
certification request. Conversely, some commenters asserted that by
allowing the certifying authority to set the minimum requirements, and
requiring those minimum requirements to be in regulation, the project
proponent, the certifying authority, and the public would be fully
informed of when the reasonable time begins and ends. One commenter
asserted that Due Process and basic fairness require certifying
authorities to publish such contents clearly and authoritatively and
asserted that EPA should clarify that certification request
requirements and receipt timing cannot be tied to procedures or
requirements that are not adopted and published as regulations.
[[Page 66578]]
After considering public comments, the Agency is not requiring a
state or authorized Tribe to define additional contents of a request
for certification in regulation. The Agency agrees that the required
contents of a request do not need to be in a regulation to be
transparent, publicly available, and provide project proponents with
adequate notice. The critical inquiry for state and Tribal certifying
authorities to consider is whether the method of identifying the
required contents in a request for certification is clear, objective,
and authoritative such that notions of fairness and notice are served.
The Agency notes that some of the state and Tribal processes are
already well known to the regulated community, have been used for 50
years, and are not in regulation. As a practical matter, states and
authorized Tribes use different approaches to define the required
contents of a request for certification, including statute,
regulations, policy documents, application forms, and guidance. The
burden of putting the contents of a request in regulation can be time
consuming (e.g., may require legislative approval before going into
effect), and may interfere with certifying authorities' ability to
describe the information they expect in a request for certification.
The final rule approach also addresses project proponent concerns
about certifying authorities that, in the past, may have unexpectedly
required additional information from the project proponent to satisfy
the request for certification requirement before starting the clock on
the ``reasonable period of time.'' Under the approach EPA is
finalizing, the reasonable period of time starts on the date that a
``request for certification'' was received in accordance with the
certifying authority's applicable submission procedures. As discussed
above, the request for certification is defined to mean a request that
contains the contents required by EPA's final regulations and any
additional state or Tribal requirements identified prior to when the
request for certification was made. This approach creates a bright-line
for project proponents seeking to avoid unexpected shifts and identify
the necessary contents for a request for certification with certainty.
In 1971, the Agency opted to not define what information, if any,
was sufficient to start the review process for all certifying
authorities and instead opted to define the information only for EPA
when it acts as the certifying authority. 40 CFR 121.22 (2019). As a
result, over the last approximately 50 years, many states and
authorized Tribes established their own requirements for what
constitutes a request for certification, also called a ``certification
request,'' typically defining it as a so-called ``complete
application.'' See, e.g., Cal. Code Regs. Tit. 23, sec. 3835; La.
Admin. Code tit. 33, sec. IX-1507; Ohio Admin. Code 3745-32-03. Prior
Agency guidance acknowledged this practice. See 1989 Guidance, at 31
(April 1989) (``Thus, after taking the federal agencies' regulations
into account, the State's 401 certification regulations should link the
timing for review to what is considered receipt of a complete
application.''); see also 2010 Handbook at 15-16 (rescinded in 2019,
see supra) (``States and tribes often establish their own specific
requirements for a complete application for water quality
certification. . . . The advantage of a clear description of components
of a complete [section] 401 certification application is that
applicants know what they must be prepared to provide, and applicant
and agencies alike understand when the review timeframe has begun.'').
Some certifying authorities rely on a ``complete application'' to start
the certification review process. In the Agency's view, a state
requirement for submittal of a complete application, when the contents
of such complete application are clearly identified ahead of time, is
not inherently subjective and can be defined by the information
identified by regulation or on a form. Establishing such a list of
required elements in advance is consistent with the rationale of NYSDEC
that criticized the state for relying on its ``subjective''
determination following submission regarding whether the request was
``complete.''
The use of a ``completeness'' standard for applications or similar
documents is not a novel concept in CWA implementing regulations.\45\
Both EPA and the Corps have developed regulations setting out
requirements for ``completeness'' or ``complete applications'' to
initiate the permitting process. See 40 CFR 122.21(e) (describing
``completeness'' for NPDES applications); 33 CFR 325.1(d)(10)
(describing when an application is deemed ``complete'' for section 404
permits). Neither CWA section 402 nor section 404 uses the word
``complete'' to modify the term ``application'' in the statute, yet the
agencies have reasonably interpreted the term ``application'' in those
contexts to allow for a ``completeness'' concept that provides a clear
and consistent framework for stakeholders involved in the section 402
and 404 permitting processes. The Agency is unaware of significant
issues with the use of ``complete applications'' in either the section
402 or section 404 permitting processes or a concern that it has led to
a ``subjective standard.''
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\45\ The use of ``complete'' applications is also applied in
other Federal environmental realms (e.g., the Safe Drinking Water
Act, the Clean Air Act). See, e.g., 40 CFR 144.31, 40 CFR 51.103,
appendix V to part 51.
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While acknowledging the ruling in NYSDEC, the Agency also notes
that the Fourth Circuit ruled in support of the reasonable period of
time beginning when the certifying authority deems the application
complete. AES Sparrows Point LNG v. Wilson, 589 F.3d 721 (4th Cir.
2009). The final rule approach is consistent with this decision in that
regard, and not inconsistent with NYSDEC, as explained above.
States' and authorized Tribes' ability to define additional
contents of a request for certification should ultimately reduce the
need for certifying authorities to request additional information from
project proponents after the request for certification has been
submitted. The limitations referenced above do not preclude certifying
authorities from asking for more information after they receive a
request for certification and the reasonable period of time begins, if
the certifying authority determines additional information would help
inform its decision-making on the request for certification. However,
these requests for additional information by a certifying authority
should be targeted to information relevant to the potential water
quality-related impacts from the activity. EPA also encourages
certifying authorities and project proponents to discuss the necessary
information that must be part of the request for certification during
the pre-filing meeting process.
ii. Requirements When EPA Is the Certifying Authority
The Agency is finalizing a list of additional contents required for
requests for certification submitted to EPA when EPA acts as a
certifying authority.\46\ This list also applies to requests for
certification submitted to states and authorized Tribes that have not
identified additional contents of a request for certification. As
discussed below, these components contain some similarities to the 1971
Rule and 2020
[[Page 66579]]
Rule, with revisions to provide further clarification and efficiency
for project proponents, EPA when it acts as a certifying authority, and
when a state or authorized Tribe has not established its own definition
of ``request for certification.''
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\46\ EPA acts as the certifying authority on behalf of states or
Tribes that do not have ``authority to give such certification.'' 33
U.S.C. 1341(a)(1). EPA acts as the certifying authority in two
scenarios: (1) on behalf of Tribes without ``treatment in a similar
manner as a state'' (TAS) and (2) on lands of exclusive Federal
jurisdiction.
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EPA proposed a list of contents that shall be included in requests
for certification to the Regional Administrator shall include the
following, if not already included in the draft license or permit:
1. The name and address of the project proponent;
2. The project proponent's contact information;
3. Identification of the applicable Federal license or permit,
including Federal license or permit type, project name, project
identification number, and a point of contact for the Federal agency;
4. Where available, a list of all other Federal, interstate,
tribal, state, territorial, or local agency authorizations required for
the proposed activity and current status of each authorization; and
5. Documentation that a pre-filing meeting request was submitted to
the certifying authority in accordance with applicable submission
requirements, unless a pre-filing meeting request has been waived. 40
CFR 121.5(c)
Proposed Sec. 121.5(b) also provided that ``[w]here a project
proponent is seeking certification from a certifying authority other
than the Regional Administrator, and that certifying authority has not
identified in regulation additional contents of a request for
certification, the project proponent shall submit a request for
certification as defined in [Sec. 121.5(c)].''
In this final rule at Sec. 121.5(b), EPA is finalizing a slightly
different list of additional contents in a request for certification
than what was proposed that combines components proposed and offered as
alternatives in the preamble to the proposed rule, due to the feedback
received in the public comments and the removal of a draft Federal
license or permit from the minimum contents for all requests for
certification. The final list of additional contents for a request for
certification when EPA is the certifying authority (or when states or
Tribes fail to define such additional contents) includes seven
components derived from the proposed approach and the alternative
approach:
1. A description of the proposed activity, including the purpose of
the proposed activity and the type(s) of discharge(s) that may result
from the proposed activity;
2. The specific location of any discharge(s) that may result from
the proposed activity;
3. A map or diagram of the proposed activity site, including the
proposed activity boundaries in relation to local streets, roads, and
highways;
4. A description of current activity site conditions, including but
not limited to relevant site data, photographs that represent current
site conditions, or other relevant documentation;
5. The date(s) on which the proposed activity is planned to begin
and end and, if known, the approximate date(s) when any discharge(s)
may commence;
6. A list of all other Federal, interstate, Tribal, state,
territorial, or local agency authorizations required for the proposed
activity and the current status of each authorization; and
7. Documentation that a pre-filing meeting request was submitted to
the certifying authority in accordance with applicable submission
procedures, unless the pre-filing meeting request requirement was
waived.
A few commenters agreed that EPA's additional contents for a
request for certification should be the default contents for a request
to a certifying authority that does not define additional contents.
However, some commenters expressed concern that EPA's default list of
additional certification request components was inadequate and did not
capture all the items a state or authorized Tribe may need for its
analysis. One commenter asserted that EPA's default additional
components create a presumption that EPA's list is sufficient for a
request for certification, and recommended that EPA make clear that
states and authorized Tribes have the authority to specify the contents
of a request for certification where they are the certifying authority.
To provide transparency and predictability, the final rule requires
project proponents seeking certification from a state or authorized
Tribe that has not identified additional contents of a request for
certification to submit the additional contents identified at Sec.
121.5(b). See Sec. 121.5(d). However, this final rule does not create
the presumption that the contents identified at Sec. 121.5(b) will be
sufficient for all scenarios and all certifying authorities. Rather,
the Agency is providing a list of minimum contents as a baseline and
allowing state and Tribal certifying authorities to define additional
contents for each request for certification. As discussed above, the
additional contents in Sec. 121.5(b) would not apply where a
certifying authority has established its own list of requirements for a
request for certification. However, EPA recommends that certifying
authorities wishing to establish their own lists of additional contents
of requests for certification consider the requirements outlined by the
Agency in Sec. 121.5(b), as these contents reflect the additional
information deemed necessary by EPA for the Agency to initiate its
analysis of a certification request on a Federal license or permit
application.
EPA requested comment on an alternative list of additional contents
to accompany a request for certification on a Federal license or permit
application. Under this alternative approach, the project proponent
would be required to submit ``proposed activity information'' with six
components, including the following:
1. A description of the proposed activity, including the purpose of
the proposed activity and the type(s) of discharge(s) that may result
from the proposed activity;
2. The specific location of any discharge(s) that may result from
the proposed activity;
3. A map and/or diagram of the proposed activity site, including
the proposed activity boundaries in relation to local streets, roads,
highways;
4. A description of current activity site conditions, including but
not limited to relevant site data, photographs that represent current
site conditions, or other relevant documentation;
5. The date(s) on which the proposed activity is planned to begin
and end and, if known, the approximate date(s) on which any
discharge(s) will take place; and
6. Any additional information to inform whether any discharge from
the proposed activity will comply with applicable water quality
requirements. 87 FR 35336.
A few commenters did not find the additional requirements for the
alternative approach to be necessary, because the information would
already be included in the application or under current state
requirements. On the other hand, some commenters provided suggestions
for the default additional contents. A few commenters recommended
supplementing the default additional request components with the six
additional components listed in the proposal preamble as an
alternative, and as suggested by one of these commenters, revising as
appropriate to address any duplication.
EPA does not agree with commenters asserting that additional
components are unreasonable. While some commenters said doing so was
unnecessary, the relevant inquiry is whether EPA's
[[Page 66580]]
inclusion of additional components is ``reasonable,'' not whether it is
``necessary.'' EPA anticipates that the list of additional required
contents at Sec. 121.5(b) is appropriate for EPA as a certifying
authority and as a default list for those other certifying authorities
that have not identified additional required contents for requests for
certification. EPA also does not intend for this list to be
duplicative. Accordingly, EPA has added text at final rule Sec.
121.5(b) to clarify that a project proponent only needs to provide the
additional components where such components are not already included in
the minimal contents of a request for certification defined at Sec.
121.5(a). For example, if a map or diagram of the proposed activity
site is part of the Federal license or permit application, the project
proponent would not be required to submit a second copy of the map or
diagram.
EPA agrees with commenters who suggested that the Agency combine
the proposed and alternative lists of additional contents. As discussed
below, the Agency has revised the list of additional contents to reduce
duplication among the minimal contents of a request for certification.
Additionally, the Agency recognizes that some of the components listed
at Sec. 121.5(b) may not be applicable if the project proponent is a
Federal agency seeking certification on the issuance of a general
Federal license or permit. Accordingly, the Agency has added regulatory
text at Sec. 121.5(b) to clarify that only the applicable additional
components need to be included in a request for certification to EPA.
First, based on commenter recommendations, EPA is not finalizing
the components of the proposed list that are expected to be captured by
the requirements in Sec. 121.5(a), such as the name and address of the
project proponent, the project proponent's contact information, and
identification of the applicable Federal license or permit, including
the Federal license or permit type, project name, project
identification number, and a point of contact for the Federal agency.
Although this type of background information was included in the 1971
Rule and the 2020 Rule, this information is unnecessary and redundant
to both the Federal license or permit application and draft Federal
license or permit.
Second, similar to the 2020 Rule, the Agency is finalizing the
requirement that the project proponent provide a list of other
authorizations that are required for the proposed activity and the
current status of such authorizations. This requirement will allow the
Agency to assess how water quality impacts may be addressed through
other Federal, state, Tribal, or local authorizations and potentially
reduce redundancies or inconsistencies between the certified Federal
license or permit and other authorizations. When the project proponent
is a Federal agency seeking certification, the Agency does not expect
the Federal agency to be able to produce such a list. Typically, when a
Federal agency seeks certification, it is seeking certification on
general Federal licenses or permits that would be used by project
applicants in the future. Therefore, at the time of the request for
certification, the Federal agency is likely unable to provide any
information on which authorizations, if any, are required for such a
future project.
Third, like the 2020 Rule, the Agency is finalizing a requirement
that the project proponent submit documentation that it requested a
pre-filing meeting, unless the pre-filing meeting request has been
waived. The documentation should be in writing, such as a copy of the
email requesting the pre-filing meeting. As discussed in section IV.B
in this preamble, a certifying authority may waive the requirement for
a pre-filing meeting request. In that event, the project proponent
would not need to produce documentation of a pre-filing meeting
request.
Fourth, the Agency is adding five components that were offered as
alternatives to the final rule text to provide EPA with information
about the proposed activity, including a description of the proposed
activity, the location of any discharge from the proposed activity, a
map or diagram of the proposed activity site, a description of current
activity site conditions, and the date(s) on which the proposed
activity will begin and end. These components are similar to those in
the 2020 Rule, see Sec. 121.5(b)(4) (2020), and the 1971 Rule, see
Sec. 122.22(b), (d) (2019). These components are necessary to initiate
EPA's analysis of a request for certification on a Federal license or
permit application.
The Agency is not including the sixth alternative component offered
at proposal, which would have required a project proponent to submit
any additional information to inform whether any discharge from the
proposed activity will comply with applicable water quality
requirements. EPA finds that such a component would be too vague and
would not provide project proponents with a clear, predictable set of a
requirements for a request for certification. However, if EPA later
determines additional information would be helpful to inform its
decision-making on a request for certification, this final rule does
not preclude EPA from asking for additional information after a
certification request is submitted. But EPA cannot require additional
components, aside from contents listed at Sec. 121.5(a) and (b), in a
request for certification.
The Agency is also finalizing the removal of the contents of the
2020 Rule at Sec. 121.5(b)(5), (8), and (9); the 1971 Rule also
contained similar contents to Sec. 121.5(b)(5) of the 2020 Rule. See
40 CFR 121.22(c), (e) (2019). Section 121.5(b)(5) of the 2020 Rule,
which required the project proponent to ``[i]nclude a description of
any methods and means proposed to monitor the discharge and the
equipment or measures planned to treat, control, or manage the
discharge,'' is unnecessary since the final rule requires a project
proponent to provide the Federal license or permit application or draft
Federal license or permit, as appropriate, and any readily available
water quality-related materials that informed the development of the
application or draft Federal license or permit in its request. The
Agency also finds it unnecessary to retain the requirements at Sec.
121.5(b)(8) and (9) of the 2020 Rule. In 2020, EPA required the project
proponent to include an attestation statement that the project
proponent ``certifies that all information contained herein is true,
accurate, and complete to the best of my knowledge and belief'' at
Sec. 121.5(b)(8) ``to create additional accountability on the part of
the project proponent to ensure that information submitted in a
certification request accurately reflects the proposed project.'' 85 FR
42245. EPA is unaware of any issues or concerns that project proponents
will not provide accurate information in the request for certification
without such attestation. Furthermore, the final contents for a request
for certification include either the license or permit application or a
copy of the draft Federal license or permit, which presumably
incorporates accurate information about the proposed project.
Additionally, Sec. 121.5(b)(9) of the 2020 Rule, which required the
project proponent to include a statement that it ``hereby requests that
the certifying authority review and take action on this CWA 401
certification request within the applicable reasonable period of
time,'' is unnecessary because a project proponent is required to
submit a request for certification as defined in this final rule.
Submitting a request for certification as defined in this final rule
should be a clear
[[Page 66581]]
indication to the certifying authority that the project proponent is
seeking certification.
A few commenters provided detailed, lengthy lists of additional
contents, beside the seven that EPA is finalizing, that could be
required by certifying authorities, including but not limited to
various plans, photographs, field surveys, construction methods, and
maps. Another commenter asserted that a request should include the
requirements for a complete application that are at least as stringent
as Federal agencies making similar determinations, such as the Corps'
requirements for complete CWA section 404 permit applications.
EPA appreciates commenter suggestions and while EPA is not
including additional contents in Sec. 121.5(b), aside from those
discussed above, the Agency emphasizes that certifying authorities are
free to define additional contents for their requests for
certification. As discussed in the prior subsection, EPA has adjusted
the language in the final rule to increase flexibility for certifying
authorities to define the additional contents of a request for
certification in regulation or another appropriate manner, such as an
official form used for requests for certification. Such additional
contents should be communicated clearly and transparently for project
proponents to be aware of before submitting a request for
certification.
c. Defining ``Receipt'' of a Request for Certification
The Agency is clarifying at Sec. 121.6(a) that ``the reasonable
period of time begins on the date that the certifying authority
receives a request for certification, as defined in Sec. 121.5, in
accordance with the certifying authority's applicable submission
procedures.'' In proposed Sec. 121.6(a), EPA stated that ``the
reasonable period of time shall begin upon receipt of a request for
certification.'' The Agency proposed to define ``receipt'' at Sec.
121.1(k) to mean ``the date that a request for certification, as
defined by the certifying authority, is documented as received by a
certifying authority in accordance with the certifying authority's
applicable submission procedures.'' The final rule merely simplifies
the proposed rule's approach to when the reasonable period of time
begins by placing the definition of receipt in Sec. 121.6(a).
The statute provides that the reasonable period of time begins
``after receipt of such request.'' 33 U.S.C. 1341(a)(1). The statute
does not define the term ``receipt of such request,'' nor does it
define how a request for certification must be received by a certifying
authority. The 1971 Rule did not address or define the term
``receipt,'' however, the Agency opted to define the term in the 2020
Rule. 40 CFR 121.1(m) (2020). The 2020 Rule defined the term
``receipt'' as ``the date that a certification request is documented as
received by a certifying authority in accordance with applicable
submission procedures.'' Id. In implementation of the 2020 Rule, there
was some confusion regarding whether it was the Federal agency's or
certifying authority's responsibility to determine that a certification
request, as defined by the 2020 Rule, was received.
Consistent with the statutory text, the reasonable period of time
begins on the date that the certifying authority receives a request for
certification, as defined at Sec. 121.5, and is submitted in
accordance with the certifying authority's applicable submission
procedures. 40 CFR 121.6(a). As discussed in more detail below, the
certifying authority must send written notification to the project
proponent and Federal agency of the date the request for certification
was received.
Some commenters asserted that, due to the wide variety of project
types, the regulations should not dictate when the reasonable period of
time begins. These commenters added that states and authorized Tribes
should determine when the reasonable period of time starts, and when
they have sufficient information to conduct a proper review, provided
it does not exceed the statutory one-year limit. As described above,
EPA provides in the final rule at Sec. 121.6(a) that ``the reasonable
period of time begins on the date that the certifying authority
receives a request for certification, as defined in Sec. 121.5, in
accordance with the certifying authority's applicable submission
procedures.'' This approach provides certifying authorities with a role
in determining when the clock starts (i.e., by defining additional
contents of a request for certification and applicable submission
procedures), while also providing transparency and consistency around
the process for requesting certification and starting the reasonable
period of time for project proponents.
Some commenters stated that the proposed definition of ``receipt''
would limit predictability and could allow certifying authorities to
delay the certification process by saying they have not received the
request for certification in full and in accordance with its submission
procedures. A few commenters asserted that the Second Circuit held that
allowing states to determine when requests are ``complete'' could
create a ``subjective standard'' in violation of the bright line
requirements of section 401. NYSDEC, 884 F.3d at 455-56. While not
retaining a definition of ``receipt'' in the final rule, EPA maintains
that consistent with section 401(a)(1), the reasonable period of time
clock starts when the certifying authority has received a request for
certification, as defined in Sec. 121.5 of the final rule, in
accordance with the certifying authority's applicable submission
procedures. See 40 CFR 121.6(a). EPA disagrees with commenter
assertions that having the certifying authority determine when it has
received a request for certification will lead to certifying
authorities subjectively determining when a request for certification
has or has not been submitted. Rather, this final rule expressly
rejects such practices by limiting requests for certification from
state and Tribal certifying authorities with additional required
components to those that are identified prior to when the request for
certification is made. See 40 CFR 121.5(c). This does not mean a
certifying authority could not ask for additional information after a
request for certification is made; rather, a certifying authority
cannot alter the required contents of the request for certification
after it is received. Similarly, the Agency disagrees that the concept
of ``completeness'' is inherently subjective. As discussed above,
having the certifying authority establish a list of additional required
contents for a request for certification before receiving a request for
certification, and therefore determine when the request has been
received, is not at odds with the decision from the Second Circuit. See
discussion supra.
The project proponent must submit the request for certification in
accordance with the certifying authority's applicable submission
procedures. Applicable submission procedures describe the manner in
which a certifying authority will accept a certification request, e.g.,
through certified mail or electronically. The Agency understands that
certifying authorities may have different procedures for receiving
certification requests (e.g., receiving certification in different
formats or requiring the payment of fees), and as such is not limiting
or defining a set of standard applicable submission procedures. The
certifying authority may provide these applicable submission procedures
in regulations or another appropriate manner, such as an official form
used for requests for certification. In whichever way the certifying
authorities
[[Page 66582]]
provide their procedures, EPA encourages certifying authorities to
communicate them transparently and publicly. EPA recommends that the
certifying authority and project proponent communicate with each other
(e.g., during any pre-filing meeting engagement) to discuss submission
procedures and contents of the request for certification.
As mentioned above, once a certifying authority receives a request
for certification, the certifying authority must send written
confirmation to the project proponent and the Federal agency of the
date that the request for certification was received. The Agency
proposed similar language at Sec. 121.5(d). However, the Agency has
moved this provision to Sec. 121.6(a) to better clarify that the
reasonable period of time does not start with the written confirmation
from the certifying authority. Rather, consistent with section
401(a)(1), it begins on the date that the project proponent submitted
the request for certification. EPA recognizes that the final rule no
longer includes a strict period for negotiation on the length of the
reasonable period of time between the certifying authority and the
Federal agency at the start of the reasonable period of time, which
means that the certifying authority may not promptly notify the project
proponent and the Federal agency that the request for certification was
received. Accordingly, the Agency is removing the regulatory text
located at Sec. 121.6(b) in the 2020 Rule, which required the Federal
agency to communicate the date of receipt of the request for
certification, the reasonable period of time, and the date waiver will
occur. Under this final rule, the certifying authority is responsible
for confirming the date of receipt of a request for certification with
the project proponent and Federal agency. However, the final rule
approach will not lead to the same level of confusion as the 2020 Rule
requirement for the project proponent to submit the request for
certification concurrently to the certifying authority and the Federal
agency. Under the 2020 Rule, although the certifying authority was
responsible for determining whether a request was received, a project
proponent could submit a deficient certification request to the Federal
agency and spur the Federal agency to communicate an inaccurate date of
receipt for the request. The final rule approach avoids this potential
miscommunication by relying on the certifying authority, rather than
the project proponent, to communicate the date of receipt of a request
for certification with the project proponent and Federal agency.
3. Implementation
The Agency recommends that project proponents, certifying
authorities, and Federal agencies work together to determine the most
efficient and effective means of communication before the certification
process begins to ensure a common understanding of the contents of a
request for certification. The final rule's pre-filing meeting process
provides an opportunity for such early engagement to identify and
discuss the appropriate request for certification requirements. Because
the final rule allows certifying authorities to require additional
contents in a request for certification as long as they are identified
prior to when the request for certification is made, certifying
authorities should make their additional contents for request for
certification and applicable submission procedures readily available
and transparent to the regulated public. EPA intends to support
certifying authority efforts to make the requests for certification
requirements transparent. For example, EPA could provide links to other
certifying authorities' websites on EPA's website or maintain an up-to-
date list of points of contact to connect project proponents with the
appropriate certifying authority.
Another way a certifying authority may further support the
efficient review of requests for certification would be for the
certifying authority to make available draft certification conditions
that project proponents can consider while developing their project
design plans and request for certification materials. Project
proponents can save time and money by preparing for and mitigating the
impacts from an activity that will not comply with applicable water
quality requirements. EPA acknowledges that not all certifying
authorities will be able to provide conditions that anticipate
potential water quality impacts from various types of activities that
will not comply with their applicable water quality requirements;
however, some certifying authorities have made example certification
conditions for certain project types or waterbodies available prior to
receipt of requests for certification for those project types or
geographic areas.
The Agency wishes to clarify several implementation questions or
issues related to the request for certification that have previously
arisen or were revealed through public comment on this rulemaking.
First, with regards to project proponents seeking project-specific
certification to obtain authorization under a Corps general permit,
project proponents must submit the minimum contents defined at Sec.
121.5(a)(1). For example, if a state or authorized Tribe denied
certification on the issuance of a Corps' general permit, then to
obtain authorization under that general permit, the project proponent
would need to obtain a project-specific certification or waiver from
the state or authorized Tribe. In those cases, the ``application'' part
of the request for certification may take the form of a pre-
construction notification (PCN), along with any readily available water
quality-related materials that informed the development of the
application (e.g., the general permit). Second, regarding individual
projects that do not involve an ``application'' or a ``license or
permit'' but still require certification, like Corps' civil works
projects, the Agency expects the project proponent to provide documents
in lieu of the application that are similar in nature, such as a
``project study'' when requesting certification. In both instances, the
Agency expects the final rule's approach should be familiar to
stakeholders who have previously sought certification on such Federal
licenses or permits for 50 years under the 1971 Rule.
A few commenters also raised various implementation-related
questions with the proposed inclusion of the draft Federal license or
permit in all requests for certification. Several commenters expressed
concern and confusion over the term ``draft permit or license'' in the
proposed rule and requested that EPA define the term to clarify the
appropriate level of detail (e.g., license or permit is ready for
issuance, final draft license or permit). Commenters also questioned
what would occur if the project changed after receiving a draft Federal
license or permit, as well as whether the project proponent was best
suited to provide the certifying authority with a copy of the draft
Federal license or permit.
As discussed above, in this final rule, a draft Federal license or
permit is only required for requests for certification on the issuance
of general Federal licenses or permits. Currently, the Agency is only
aware of general permits for two Federal agencies: the Corps (section
404 program) and EPA (section 402 program). The Agency does not find it
necessary to define ``draft license or permit'' for purposes of this
rulemaking, in part because stakeholders should be familiar with the
process of requesting certification on these Federal licenses or
permits and Federal agencies will be acting as the ``project
proponent'' in
[[Page 66583]]
these instances. This final rule does not require a Federal agency
seeking certification on the issuance of a general Federal license or
permit to seek certification immediately upon publication of the draft
Federal license or permit. Rather, the Federal agency must request
certification after publication of the draft Federal license or permit.
For example, the Corps is required to request certification on the
nationwide permits (NWPs) when they are renewed every five years.
First, the Corps proposes the draft NWPs and takes comment on the
proposals, and later finalizes the NWPs after considering public
comment. Under this final rule, the Corps may request certification on
the NWPs after it receives and considers public comment on the
proposals but before finalizing the NWPs. In that scenario, the Corps
would provide the non-finalized NWP to the certifying authority as the
draft permit in its request for certification to satisfy the
requirements. EPA encourages Federal agencies and certifying
authorities to work together to determine the point in time at which a
request would be most appropriate to allow for an informed and
efficient certifying authority review. Such coordination could also
avoid questions or concerns arising over significant changes to the
draft Federal license or permit post-request. However, there may always
be a degree of uncertainty or possibility for project changes when it
comes to certifying any project because a Federal agency must obtain a
certification prior to issuing a Federal license or permit.\47\ EPA
encourages certifying authorities to engage early and often with
project proponents and Federal agencies and develop certification
conditions that allow for ``adaptive management'' in the event a
project changes. See section IV.F in this preamble for further
discussion on adaptive management conditions.
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\47\ A final Federal license or permit may not be issued until
after a certification or waiver is obtained by the project
proponent. 33 U.S.C 1341(a)(1) (``No license or permit shall be
granted until certification required by this section has been
obtained or has been waived as provided in the preceding
sentence.'') Therefore, requiring a copy of the final Federal
license or permit to initiate the certification process would be
inconsistent with the plain language of section 401.
---------------------------------------------------------------------------
Neither the CWA nor this final rule require project proponents to
submit the request for certification for an individual license or
permit at the time a Federal license or permit application is
submitted. Accordingly, project proponents would not be precluded from
providing a copy of the draft Federal license or permit, in addition to
the Federal license or permit application, when requesting
certification for individual Federal licenses or permits. For example,
EPA can continue its longstanding practice of submitting a copy of the
draft individual CWA section 402 NPDES permit to the certifying
authority for its review. However, project proponents would not be
required to wait to request certification for an individual Federal
license or permit until a copy of the draft Federal license or permit
is obtained, unless the certifying authority has defined in its
additional contents for a request for certification that the request
must include a copy of the draft Federal license or permit.
A few commenters recommended allowing certifying authorities to
issue certification decisions in the absence of a request for
certification. For purposes of section 401, EPA does not agree that a
CWA section 401 certification can be issued in the absence of a project
proponent requesting certification for a Federal license or permit that
may result in any discharge into waters of the United States. See
section IV.A in this preamble for further discussion on when
certification is required.\48\ Similarly, if the certifying authority
never received a request for certification or if the request for
certification or Federal license or permit application was withdrawn,
then the certifying authority is no longer responsible for acting on
the request for certification because the pre-requisite ``request'' is
absent. See section IV.D.2.c in this preamble regarding the Agency's
position on the legality of the practice of withdrawing and
resubmitting requests for certification.
---------------------------------------------------------------------------
\48\ EPA is aware that in some instances, certifying authorities
use section 401 certifications as state permits under state law;
however, this final rule does not address such practices.
---------------------------------------------------------------------------
As mentioned above, once a certifying authority receives a request
for certification, the certifying authority must send written
confirmation to the project proponent and the Federal agency of the
date that the request for certification was received. 40 CFR 121.6(a).
If a project proponent submits a request for certification that does
not meet the requirements of Sec. 121.5 of this final rule, the Agency
recommends that the certifying authority promptly notify the project
proponent that it did not submit a request for certification in
accordance with Sec. 121.5 of this final rule. However, as discussed
previously, certifying authorities and project proponents can avoid
such outcomes by leveraging early engagement opportunities (i.e., pre-
filing meetings) to ensure a common understanding of the required
contents of a request for certification.
D. Reasonable Period of Time
1. What is the Agency finalizing?
Under section 401, 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).'' 33 U.S.C. 1341(a)(1). At Sec. 121.6(a), EPA clarifies that
the reasonable period of time begins on the date that a request for
certification, as discussed in the previous section, is received by the
certifying authority in accordance with its applicable submission
procedures. Section 121.6(b) provides Federal agencies and certifying
authorities with the ability to jointly set the reasonable period of
time, provided it does not exceed one year from the date that the
request for certification was received. The final rule clarifies that
the joint determination of the reasonable period of time may happen on
a case-by-case basis or categorically. See 40 CFR 121.6(b).
Under this final rule, if the Federal agency and certifying
authority do not agree upon a reasonable period of time, the default
reasonable period of time will be six months from the date that the
request for certification was received. See 40 CFR 121.6(c). This
default approach obviates the need for a dispute resolution process in
the event the certifying authority and Federal agency are not able to
agree on the reasonable period of time. The Agency proposed a 60-day
default reasonable period of time. However, for several reasons
discussed below, the Agency is not finalizing the proposed 60-day
default reasonable period of time.
The pre-filing meeting could be a venue for the Federal agency and
certifying authority to discuss the length of the reasonable period of
time, particularly because the project proponent participates in that
meeting and will, therefore, be informed of any reasonable period of
time-related discussions and decisions. EPA also recognizes that the
Federal agency and the certifying authority may benefit from discussing
the length of the reasonable period of time before the pre-filing
meeting to then use the pre-filing meeting to inform the project
proponent of the agreed-upon length. Although the Agency is not listing
factors that Federal agencies and certifying authorities must consider
when establishing the reasonable period of time that the certifying
authority has to act on the
[[Page 66584]]
request for certification, Federal agencies and certifying authorities
might consider factors such as project type, complexity, location, and
scale; the certifying authority's administrative procedures; other
relevant timing considerations (e.g., Federal license or permit
deadlines; associated National Environmental Policy Act deadlines; and/
or anticipated timeframe for neighboring jurisdictions process); and/or
the potential for the licensed or permitted activity to affect water
quality. Federal agencies and certifying authorities might also elect
to establish joint reasonable period of time procedures and/or
agreements through a memorandum of agreement (MOA) or similar. Such
MOAs could apply to all federally licensed or permitted activities or
only to specific types of activities (e.g., activities covered by
general permits). The requests for certification that fall under these
MOAs would not require individual written agreements confirming the
reasonable period of time between the Federal agency and certifying
authority for each Federal license or permit. Alternatively, Federal
agencies and certifying authorities might prefer to agree and establish
the reasonable period of time in writing on a case-by-case basis.
EPA is finalizing as proposed that after the reasonable period of
time is set, the Federal agency and certifying authority may agree to
extend the reasonable period of time, provided that it does not exceed
one year from the date that the request for certification was received.
See 40 CFR 121.6(e). Section 121.6(d) also provides automatic
extensions for certain situations, as EPA recognizes there are
circumstances under which the Federal agency must extend the reasonable
period of time without the certifying authority needing to negotiate an
agreement. Such circumstances are where a certification decision cannot
be rendered within the negotiated or default reasonable period of time
due to force majeure events (including, but not limited to, government
closure or natural disasters) and when state or Tribal public notice
procedures necessitate a longer reasonable period of time.
If a longer period of time to review the request for certification
is necessary due to either of these circumstances, upon written
notification to the Federal agency by the certifying authority prior to
the end of the reasonable period of time, the reasonable period of time
shall be extended by the amount of time necessitated by public notice
procedures or the force majeure event, as long as it does not cause the
reasonable period of time to exceed one year from the date that the
request for certification was received. In its notification, the
certifying authority must provide the Federal agency with a written
justification for the automatic extension. The justification must
describe the circumstances supporting the extension (i.e.,
accommodating the certifying authority's public notice procedures,
government closures, or natural disasters) and does not require Federal
agency approval before taking effect. The extended reasonable period of
time would take effect upon notification by the certifying authority to
the Federal agency.
Aside from these automatic extensions, the Agency expects that
certifying authorities and Federal agencies will collaboratively agree
to discretionary extensions to the reasonable period of time where
appropriate. For example, the certifying authority and Federal agency
could develop, in a MOA or similar instrument, a process to identify
scenarios where changes to the reasonable period of time would be
appropriate. Such scenarios may include situations where relevant new
information becomes available during the reasonable period of time. EPA
notes that the final rule promotes early collaboration and pre-filing
meetings to allow the Federal agency, certifying authority, and the
project proponent to discuss project complexity, seasonal limitations,
and other factors that may influence the amount of time needed to
complete the certifying authority's analysis. These opportunities may
reduce the need to extend the jointly established or default reasonable
period of time.
Consistent with the proposal, EPA is not taking a position on the
legality of withdrawing and resubmitting a request for certification.
While there may be situations where withdrawing and resubmitting a
request for certification is appropriate, drawing a bright regulatory
line on this issue is challenging, and the law in this area is dynamic.
See, e.g., Hoopa Valley Tribe v. FERC, 913 F.3d 1099, 1105 (D.C. Cir.
2019) (holding that repeated, coordinated withdrawal and resubmittal of
a certification request resulted in a waiver); N.C. Dep't of Envtl.
Quality (NCDEQ) v. FERC, 3 F.4th 655, 676 (4th Cir. 2021) (finding that
the record did not support FERC's determination that the state and
project proponent withdrew and resubmitted the certification request in
a coordinated fashion resulting in waiver). For these reasons, the
final rule does not take a position on this issue, instead allowing the
different state and Tribal certifying authorities, Federal agencies,
and/or possibly project proponents to make case-specific decisions
addressing the practice.
The Agency is also finalizing deletions in the part 124 provisions
regarding the reasonable period of time for certification on EPA-issued
NPDES permits, formerly located at 40 CFR 124.53(c)(3), in favor of the
reasonable period of time provisions in the final rule at Sec. 121.6.
The approach to the reasonable period of time taken in Sec. 124.53(c)
was not fully consistent with the approach at Sec. 121.6. For
instance, the standard reasonable period of time was 60 days instead of
the default six months in Sec. 121.6(c). Further, unlike Sec.
121.6(b), Sec. 124.53(c)(3) did not include a provision allowing
certifying authority collaboration in setting the reasonable period of
time. And unlike Sec. 121.6(d), Sec. 124.53(c)(3) did not allow for
automatic extensions to accommodate a certifying authority's public
notice procedures or force majeure events (instead allowing extensions
beyond the default 60 days only if EPA finds ``unusual circumstances''
require a longer time). Consequently, EPA has deleted Sec.
124.53(c)(3). In addition, EPA has made conforming changes in Sec.
124.53(c) for consistency with the request for certification
requirements in Sec. 121.5.
2. Summary of Final Rule Rationale and Public Comment
Section 401(a)(1) provides that a certifying authority waives its
ability to certify a Federal license or permit if it does not act on a
certification request within the reasonable period of time. 33 U.S.C.
1341(a)(1) (``If the State, interstate agency, or Administrator, as the
case may be, fails or refuses to act on a request for certification,
within a reasonable period of time (which shall not exceed one year)
after receipt of such request, the certification requirements of this
subsection shall be waived with respect to such Federal
application.''). Other than specifying its outer bound (one year), the
CWA does not define what length of time is ``reasonable.'' The 1971
Rule explained that a certifying authority would waive its opportunity
to certify if it did not act within ``a reasonable period of time'' and
provided that: (1) the Federal licensing or permitting agency
determines the length of the reasonable period of time, and (2) the
reasonable period of time ``shall generally be considered to be six
months, but in any event shall not exceed one year.'' See 40 CFR
121.16(b) (2019).
The 2020 Rule provided that the Federal agency alone sets the
reasonable
[[Page 66585]]
period of time and defined a process for how it should be determined.
See 40 CFR 121.6 (2020). This process specified when a Federal agency
must communicate the reasonable period of time to the certifying
authority and identified factors that the Federal agency must consider
when setting the reasonable period of time. See id.; 85 FR 42259-60
(July 13, 2020). The 2020 Rule did not maintain the 1971 Rule's six-
month default and reiterated that the reasonable period of time could
not exceed one year from receipt of the certification request. 40 CFR
121.6 (2020). The 2020 Rule also defined the term ``reasonable period
of time'' as the length of time during which the certifying authority
may act on a request for certification. 40 CFR 121.1(l) (2020).
Some Federal agencies promulgated regulations describing a
reasonable period of time for section 401 certification in relation to
those agencies' licenses or permits prior to the 2020 Rule. For
example, FERC has explicitly defined the reasonable period of time to
be one year. See 18 CFR 4.34(b)(5)(iii), 5.23(b)(2), 157.22(b).\49\ The
Corps has routinely implemented a 60-day reasonable period of time for
section 401 decisions commencing when the certifying authority receives
a section 401 certification request. See 33 CFR 325.2(b)(1)(ii). EPA
established a 60-day reasonable period of time for NPDES permits. See
40 CFR 124.53(c)(3).
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\49\ FERC proposed and finalized regulations to codify FERC's
practice of a one-year reasonable period of time on natural gas or
liquefied natural gas infrastructure projects after the 2020 Rule.
See 86 FR 16298 (March 29, 2021).
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In pre-proposal input on the rulemaking, project proponents
generally supported the reasonable period of time provisions in the
2020 Rule, whereas most states, Tribes, and non-governmental
organizations expressed concern with various aspects of it. Some
certifying authorities also pointed out that short reasonable periods
of time (e.g., 60 days) do not allow the state or authorized Tribe
sufficient time to fulfill certain state or Tribal law requirements,
such as public notice procedures, or allow them to obtain all the
information they need about a project to make an informed certification
decision. As a result, these certifying authorities asserted that for
complex projects, their only realistic options are to waive or deny
certification. EPA expressed similar concerns in its notice of intent
to revise the 2020 Rule. See 86 FR 29543 (June 2, 2021) (``Among other
issues, EPA is concerned that the rule does not allow state and tribal
authorities a sufficient role in setting the timeline for reviewing
certification requests . . . .'').
The Agency proposed at Sec. 121.6(b) that the Federal agency and
certifying authority may jointly set the reasonable period of time on a
case-by-case or project type basis. Additionally, the proposal included
a default reasonable period of time of 60 days if the Federal agency
and certifying authority are not able to come to an agreement within 30
days of receipt of the request of certification at Sec. 121.6(c).
Proposed Sec. 121.6(c) and (d) also introduced extensions of the
reasonable period of time. It was proposed that the negotiated or
default reasonable period of time would automatically be extended to
accommodate public notice and comment processes or due to force majeure
events. The Federal agency and certifying authority could also agree to
extend the reasonable period of time for any reason, provided it did
not exceed the statutory one-year maximum. Lastly, in the proposal, the
Agency did not take a stance on the legality of the withdrawal and
resubmittal approach to restart the clock. 87 FR 35341-42 (June 9,
2022).
Similar to the proposal, this final rulemaking not only affirms and
clarifies that--consistent with the statutory text--the reasonable
period of time may not exceed one year from the date the request for
certification is received, but it also finalizes the proposed approach
that the Federal agency and certifying authority may collaboratively
set the reasonable period of time on a project-by-project basis or
categorical project type basis (e.g., through development of procedures
and/or agreements), provided that it does not exceed one year. 40 CFR
121.6(b). Under this final rule, in a change from proposal, if the
Federal agency and certifying authority do not agree upon the
reasonable period of time in writing, the default reasonable period of
time would be six months from the date the request for certification is
received. 40 CFR 121.6(c). The final rule also allows for extensions
under certain circumstances. 40 CFR 121.6(d) and (e). Additionally, the
Agency is removing as unnecessary the definition for ``reasonable
period of time.'' See 40 CFR 121.1(l) (2020). Like that definition, the
final rule language in Sec. 121.6(b) itself provides that the
reasonable period of time is the time during which the certifying
authority must act on the request for certification. As a result, the
Agency finds it duplicative and unnecessary to include a separate
definition for the term ``reasonable period of time.''
a. Reasonable Period of Time Determination
i. Joint Setting of the Reasonable Period of Time
The collaborative approach in this final rule (i.e., the Federal
agency and certifying authority may jointly set the reasonable period
of time with a default of six months if an agreement is not reached)
differs from the approach in both the 1971 Rule and the 2020 Rule where
the reasonable period of time was determined solely by the Federal
agency. See 40 CFR 121.16(b) (2019); 40 CFR 121.6(a) (2020). The
approach taken in the 1971 and 2020 Rules is not compelled by the
statutory text because CWA section 401(a)(1) is silent regarding who
may or must determine the reasonable period of time. Nor does the
statute imply that the Federal agency is the only entity that may
establish the reasonable period of time. As such, and as described
below, EPA finds that the best reading of the statute is to allow both
entities--the certifying authority and the Federal agency--to play a
role in establishing the reasonable period of time, and only include
the EPA-derived default of six months if they cannot come to an
agreement.
As stated above, Federal agencies and certifying authorities may
collaboratively set the reasonable period of time in lieu of relying on
the default of six months. Under this approach, Federal agencies and
certifying authorities can offer each other their expertise relevant to
determining what timeframe is reasonable. Federal agencies are in the
best position to opine on timing in relation to their Federal licensing
or permitting process. Likewise, certifying authorities are in the best
position to determine how much time they need to evaluate potential
water quality impacts from federally licensed or permitted activities.
Certifying authorities are also best positioned to opine on the impacts
of state or Tribal procedures governing the timing of decisions with
respect to environmental review and public participation
requirements.\50\ Given that
[[Page 66586]]
EPA is deferring to the combined expertise of the Federal agencies and
certifying authorities for establishing the reasonable period of time,
this final rule does not retain the list of factors that a Federal
agency shall consider, under the 2020 Rule at Sec. 121.6(c), when
establishing the reasonable period of time. However, the Agency notes
that Federal agencies and certifying authorities might consider factors
such as project type, complexity, location, and scale; the certifying
authority's administrative procedures; other relevant timing
considerations (e.g., Federal license or permit deadlines; associated
National Environmental Policy Act deadlines; and/or anticipated
timeframe for neighboring jurisdictions process); and/or the potential
for the licensed or permitted activity to affect water quality.
Importantly, this final rule approach addresses state and Tribal
stakeholders' concerns that, under the 2020 Rule, certifying
authorities did not have enough influence in determining the length of
the reasonable period of time for a particular project.
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\50\ Section 401(a)(1) requires a State or interstate agency to
establish procedures for public notice in the case of all
applications for certification by it and, to the extent it deems
appropriate, procedures for public hearings in connection with
specific applications. However, section 401(a)(1) does not set any
requirements or time limits on those public notice procedures or how
those procedures should be considered when setting the reasonable
period of time. Some certifying authorities have public notice
procedures that exceed the default reasonable period of time in
place for some Federal agencies (e.g., longer than the Corps' or
EPA's current default 60-day reasonable period of time for federally
issued CWA section 404 and 402 permits).
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Many commenters expressed support for the collaborative approach of
the Federal agency and certifying authority setting the reasonable
period of time together. These commenters said that the joint
determination is consistent with cooperative federalism principles and
allows certifying authorities to provide input as the stakeholder that
conducts the review of the request for certification. Some commenters
also supported the setting of reasonable periods of time through MOAs
between the Federal agency and certifying authority to reduce the need
to determine the reasonable period of time on a case-by-case basis.
Commenters also suggested that the final rule should provide that
Federal and state agencies can agree to categorical time periods for
state review of certain types of permits, licenses, or projects,
pursuant to written agreements, which many did before the 2020 Rule. A
few commenters raised concerns about the time and resources that would
be needed to set a reasonable period of time for every review of a
request for certification and suggested that the final rule should
clarify that categorical agreements, in addition to case-by-case
agreements, are permissible.
While the Agency agrees that the joint agreement approach promotes
cooperative federalism, EPA recognizes that coordinating the reasonable
period of time for reviewing requests for certification requires time
and resources for Federal agencies and certifying authorities.
Therefore, EPA encourages the creation of MOAs between Federal agencies
and certifying authorities as appropriate to help reduce the need for
determining the reasonable period of time on a case-by-case basis for
every request. In response to commenters' concerns about setting the
reasonable period of time each time a request for certification is
submitted, the final rule clarifies that Federal agencies and
certifying authorities may set categorical reasonable periods of time
through written agreements--for example, based on certain types of
Federal licenses or permits.
Other commenters did not support setting the reasonable period of
time through a joint agreement between the Federal agency and
certifying authority. Some commenters said that EPA should remain
silent on who sets the reasonable period of time and that certifying
authorities should apply their own procedures. Some of these commenters
argued that the Federal agency should not be placed on the same footing
as the certifying authority in determining the reasonable period of
time because the certifying authority is the expert regarding their own
procedures, resources, and applicable state and Tribal laws.
Conversely, other commenters stated that the Federal agency should set
the reasonable period of time. One commenter stated that having a
Federal agency set the default serves to minimize the arbitrary delays
and bureaucratic gamesmanship, and thus EPA should continue to have
Federal agencies establish it, as they have done for decades. Several
commenters also expressed concern that the collaborative approach would
cause instability or inefficiencies for various reasons, including the
fact that there could be different reasonable periods of time if it is
set on a case-by-case basis or may differ by certifying authority.
This joint agreement approach is the optimal interpretation of the
statute as it balances equities between the Federal agency and
certifying authority and utilizes the expertise of both stakeholders.
EPA disagrees that having the Federal agency alone set the default
serves to minimize arbitrary delays and bureaucratic gamesmanship
because that approach leaves the certifying authority out of the
decision-making process. And as stated above, EPA anticipates that
certifying authorities and Federal agencies will enter into categorical
agreements, which will minimize, if not eliminate, any potential
arbitrariness and bureaucratic gamesmanship. Additionally, written
agreements between Federal agencies and certifying authorities with
categorical reasonable periods of time would create efficiency while
still taking advantage of the knowledge of both parties for determining
the time necessary for reviewing each request for certification.
One commenter asked that the joint agreement between the Federal
agency and the certifying authority be made in consultation with the
project proponent to allow for greater regulatory predictability for
project proponents and reduce any confusion among the parties. EPA
disagrees that any joint agreement between the Federal agency and the
certifying authority must be made in consultation with the project
proponent. Considering the high annual average number of requests for
certification,\51\ and therefore project proponents, it is unlikely it
would reduce confusion or allow for regulatory predictability. Rather,
instead of relying on categorical reasonable periods of time (e.g., by
project type, by Federal license or permit type), certifying
authorities and Federal agencies would have to consult with project
proponents on every request for certification. Consistent with the
cooperative federalism principles imbued in section 401, Federal
agencies and certifying authorities, not project proponents, have
primary roles in the certification process. That is, it is the Federal
agency whose license or permit is subject to section 401, and the
certifying authority is responsible for determining compliance with
applicable water quality requirements in accordance with section 401.
---------------------------------------------------------------------------
\51\ EPA estimates that the average annual number of
certification requests is 1,947 requests per certifying authority.
See Supporting Statement for the Information Collection Request
(ICR).
---------------------------------------------------------------------------
Additionally, requiring project proponent consultation in every
case would add unnecessary across-the-board procedure and coordination
into the certification process. However, EPA notes that certifying
authorities and Federal agencies are welcome to consult with project
proponents if they wish. For example, early engagement with the project
proponent during any pre-filing meeting discussions could serve to
gather input from project proponents that may help in setting the
reasonable period of time. Federal agencies and certifying authorities
may also choose to include input from project proponents when setting
categorical reasonable periods of time via MOAs.
Some commenters who also expressed concern about the 30-day
negotiation period between the Federal agency and certifying authority
in the proposed
[[Page 66587]]
rule. Some of these commenters stated that certifying authorities would
need to expend their resources on both negotiating the reasonable
period of time and trying to review the request for certification due
to the clock already running during the negotiation period. In response
to commenters' concerns, EPA is not finalizing a timeframe for the
negotiation between Federal agencies and certifying authorities--
especially because the final rule makes it clear that the certifying
authority and Federal agency may coordinate categorical agreements
prior to the date that a request for certification was received.
However, the Agency encourages prompt negotiations between the Federal
agencies and certifying authorities for both individually determined
reasonable periods of time and categorical reasonable periods of time
to give clarity to project proponents as early as possible.
ii. Default Reasonable Period of Time
Section 401(a)(1) provides that the reasonable period of time
``shall not exceed one year.'' 33 U.S.C. 1341(a)(1). The phrase ``shall
not exceed one year'' means that the reasonable period of time need not
be one full year and that a certifying authority should not necessarily
expect to be able to take a full year to act on a section 401 request
for certification. If Congress had meant for the reasonable period of
time to be one year in all cases, it would have simply written ``shall
be one year'' instead of ``shall not exceed one year.'' Under this
final rule, the certifying authority could be subject to a shorter than
one-year reasonable period of time to render its decision, provided
that the Federal agency and the certifying authority have agreed to a
shorter time, or as discussed below, when the parties do not reach
agreement and instead rely on the default reasonable period of time of
six months. This approach is consistent with case law. See Hoopa Valley
Tribe v. FERC, 913 F.3d 1099, 1104 (D.C. Cir. 2019) (``[W]hile a full
year is the absolute maximum, it does not preclude a finding of waiver
prior to the passage of a full year.'').
As discussed in more detail below, many commenters opposed the
default 60-days for a variety of reasons and offered alternative
reasonable periods of time, such as 90 days, 120 days, 180 days, and
one year. For the final rule, EPA decided on six months as the default
reasonable period of time for several reasons. First, as stated above,
a default six-month reasonable period of time is consistent with the
Agency's longstanding 1971 regulations, which provided that the
reasonable period of time is generally considered to be six months. See
40 CFR 121.16(b) (2019). Thus, EPA's decision to choose six months as
the default is consistent with almost 50 years of program
implementation under EPA's 1971 regulations. Second, six months is
exactly half of one year, which is the statutory maximum for the
reasonable period of time. If the Federal agency and certifying
authority cannot reach an agreement, it seems reasonable to designate
half of the statutory maximum as the default reasonable period of time
as a middle ground to best balance equities between the Federal agency
and certifying authority. Third, six months should give the Federal
agency and certifying authority ample time to negotiate an alternate
reasonable period of time if they do not want to be subject to the six-
month default. At the same time, the six-month period serves as a
default should Federal agencies and certifying authorities fail to
agree on a different time period. Finally, EPA's proposed 60-day
default reasonable period of time was based largely on EPA's concurrent
proposal to require that requests for certification include a copy of
the draft Federal license or permit. Since the certifying authority
would have more information upfront (the draft Federal license or
permit instead of only the application), the Agency proposed that the
default reasonable period of time could be shorter. But since EPA has
decided not to finalize the proposed draft Federal license or permit
requirement (for individual Federal licenses and permits) and instead
only require that a request for certification include the Federal
license or permit application, certifying authorities will have less
information and may need more time to review requests for
certification, hence the six-month default reasonable period of time
(which only applies if the certifying authority and Federal agency do
not agree on an alternative).
Although EPA proposed 60 days as the default reasonable period of
time, the Agency requested comment on whether and, if so, why the
default should be longer than 60 days (e.g., 120 days, six months, one
year). 87 FR 35339-40 (June 9, 2022). EPA noted that the default may
depend on when certification is requested during the Federal licensing
or permitting process, e.g., if EPA were to decide that a draft Federal
license or permit is not a required component of a certification
request, a longer default reasonable period of time may be appropriate.
Id. Based on comments received on the proposed rule, it seems that
many, if not most, commenters would support a six-month default
reasonable period of time, as described in this section.
A few commenters supported the proposed 60-day default and pointed
out that certifying authorities often review many simpler projects in
30 days or less, and in some jurisdictions, applicable law already
requires certifying authorities to approve or deny the certification
request within 60 days of receipt of a complete application. A few
commenters argued that the 60-day default would ensure consistency and
predictability for stakeholders. One commenter proposed that the
default be 60 days unless the Federal agency regulations define a
different reasonable period of time, provided it is not less than 60
days, which would allow FERC to continue applying one year, per its
regulations. Relatedly, other commenters opined that the final rule
should clarify that if a Federal agency has a regulation or guidance
document establishing a longer period for a particular type of request,
that regulation or guidance document applies.
EPA agrees in part and disagrees in part with these comments. EPA
agrees that some certifying authorities often review many simpler
projects in a short period of time, such as 30 or 60 days. EPA
recognizes that a 60-day reasonable period of time is being implemented
for section 401 decisions for some licenses and permits, including by
EPA for draft NPDES permits and by the Corps. EPA disagrees that 60
days as a default reasonable period of time for all projects is
practical for the reasons provided in the Agency's rationale above, in
addition to the many comments summarized below explaining why a 60-day
default for all projects is not sufficient. EPA agrees that a uniform
period can provide clarity to project proponents and other
stakeholders, but any uniform period should only be a default to allow
the certifying authority and Federal agency to determine, as
appropriate, the review timeframe on an individual or categorical
basis. While this may reduce the ability of project proponents to
anticipate the timeline for the certification process, they will still
have six months as a default guidepost, plus EPA encourages certifying
authorities and Federal agencies to enter into categorical agreements
that will allow project proponents to anticipate timelines for
certification processes. The default reasonable period of time would
not apply if the Federal agency and certifying authority agree to a
different time. EPA does not agree that Federal agency defaults in
regulation that are less than one year should supersede the
[[Page 66588]]
need for a certifying authority and Federal agency to collaborate in
setting the reasonable period of time. That said, if a Federal agency
establishes a one-year reasonable period of time in regulation, it
would not be at odds with the final rule's language or intent. Rather,
in such a scenario (e.g., FERC regulations), it is unnecessary for the
certifying authority and Federal agency to negotiate an alternate
reasonable period of time because the Federal agency has already agreed
to the maximum amount of time statutorily allowed, and if the
certifying authority determines that one year is too long, it may act
on the request for certification as early as it chooses. In these
circumstances, individual written agreements for each request for
certification would not be necessary, since a negotiation between the
certifying authority and Federal agency would not need to occur.
Most commenters opposed the 60-day default reasonable period of
time. Commenters noted that while 60 days may be enough time for
simpler or more routine projects, which may include some projects
covered by general or nationwide permits, 60 days would be insufficient
for especially novel, complicated, controversial, or complex projects.
Some commenters provided various examples of such project types,
including FERC pipeline authorizations, relicensing of hydroelectric
dams, water supply projects, liquefied natural gas (LNG) terminals,
deep-water ports, and projects that trigger the need for an
environmental impact statement (EIS) or multiple Federal permits.
Commenters also added that each request is different and carries unique
implications to be examined based on the specific characteristics of
the water bodies and proposed project and Federal license or permit in
question. Some commenters said that because the proposed rule would
require agreement between the Federal agency and certifying authority
on a different amount of time, the proposal would effectively and
inappropriately give Federal agencies veto power over certifying
authorities, infringing on principles of collaborative federalism.
Commenters also said that states and Tribes know their own procedures,
resources, and applicable requirements and should have input into
deciding the length of the reasonable period of time. Lastly,
commenters argued that the 60-day default would be inadequate if the
final rule does not require submittal of the draft Federal license or
permit in a request for certification, noting that the proposed default
appeared to be predicated on the assumption that the ``request'' the
certifying authority will receive will include a draft Federal license
or permit.
The Agency has decided to finalize a default reasonable period of
time of six months to best balance equities between the Federal agency
and certifying authority. As discussed above, Federal agencies and
certifying authorities offer different types of relevant expertise for
setting the reasonable period of time, and EPA encourages them to
establish categorical reasonable period of time. The final rule default
provides both parties with ample time to negotiate the reasonable
period of time and inform its length based on their respective
expertise but provides a default middle ground (half of the maximum one
year) in the event an agreement cannot be reached. EPA acknowledges
that 60 days may not be a sufficient default for certain project types
and has accordingly shifted the default reasonable period of time to
six months. However, the Agency emphasizes that the default only
applies in the absence of a written agreement between the certifying
authority and Federal agency, either categorically or on a case-by-case
basis. The Agency encourages consideration of project complexities when
setting the reasonable period of time.
Some commenters alleged that the proposed default reasonable period
of time is contrary to the plain language and intent or purpose of CWA
section 401. These commenters said Congress did not authorize EPA to
contravene the statute by mandating action, or allowing the Federal
agency to mandate action, in less than one year; and if there should
there be any default, it should simply be the one year allowed under
the statute. EPA disagrees with these commenters. As discussed above,
section 401(a)(1) provides that the reasonable period of time ``shall
not exceed one year,'' which means that the reasonable period of time
can be less than one year. As stated above, if Congress meant for the
reasonable period of time to be one year in all cases, it would have
simply written ``shall be one year.'' But Congress did not do that. For
the reasonable period of time to ``not exceed one year,'' it must
either be less than or equal to one year. Under the clear language of
the statute, Congress envisioned a scenario in which the reasonable
period of time could be less than one year. For the reasons explained
in this section, EPA reasonably decided on six months as the default,
which is half of the maximum allowable time, substantially longer than
the proposed and often applied 60 days, and consistent with almost 50
years of implementation under the 1971 Rule. Again, the default only
applies where the Federal agency and certifying authority cannot agree
on another period of time, which EPA expects to be rare. In sum, this
approach is consistent with the plain text of CWA section 401 and the
Agency's longstanding implementation of that text under the 1971 Rule,
which acknowledged that the reasonable period of time may be less than
one year and is generally considered to be six months. See 40 CFR
121.16(b) (2019). Nevertheless, the Agency re-emphasizes that six
months is only the default, and that certifying authorities and Federal
agencies may agree to a reasonable period of time less than or equal to
one year on a case-by-case or categorical basis.
b. Extensions to the Reasonable Period of Time
As mentioned previously, the final rule provides that Federal
agencies and certifying authorities may agree to extend the reasonable
period of time, provided it does not exceed the statutory one-year
limit. Additionally, there may be circumstances where the established
or default reasonable period of time is not sufficient to allow the
certifying authority to complete its review. Therefore, the final rule
provides automatic extensions to accommodate public notice procedures
or due to force majeure events. In these two circumstances, the
reasonable period of time is extended by the time needed by public
notice procedures or the force majeure event, which would be
communicated in the written justification by the certifying authority
to the Federal agency. The Agency is finalizing that extensions of the
reasonable period of time must occur to accommodate certifying
authority public notice ``procedures,'' rather than public notice
``requirements'' as was proposed. This change is consistent with the
statutory language that certifying authorities ``shall establish
procedures for public notice in the case of all applications for
certification.'' 33 U.S.C. 1341(a)(1). The change to ``procedures''
also clarifies that extensions to the reasonable period of time could
be due to subsequent public hearing procedures, and this language is
consistent with the final rule language for certification decisions and
Federal agency review at Sec. Sec. 121.7 and 121.8. The statute does
not address extending the reasonable period of time once it has
started; it does not prohibit extending the reasonable period of time
as long as the certifying authority ``acts'' within one year from the
date the request for
[[Page 66589]]
certification is received. The statute also does not specify who may
extend the reasonable period of time or the terms on which it may be
extended. The 1971 Rule was also silent on extensions. However, several
Federal agencies, including EPA and the Corps, have established
regulations allowing extensions to their default reasonable periods of
time. See 40 CFR 124.53(c)(3) (2022) (allowing for a reasonable period
of time greater than 60 days for certification requests on NPDES
permits where the EPA Regional Administrator finds ``unusual
circumstances''); 33 CFR 325.2(b)(1)(ii) (allowing for a reasonable
period of time greater than 60 days for certification requests on Corps
permits when the ``district engineer determines a shorter or longer
period is reasonable for the state to act.''). The 2020 Rule allowed
certifying authorities to request an extension of the reasonable period
of time. 40 CFR 121.6(d) (2020). However, only the Federal agency had
the power to extend the reasonable period of time. Id.; see also 85 FR
42260. Under the 2020 Rule, the Federal agency was not required to
grant extension requests. See 40 CFR 121.6(d)(2) (2020). As a result,
Federal agencies denied those requests even in situations where the
certifying authority said it was not able to act within the established
timeframe (e.g., where state public notice procedures required more
time than the regulatory reasonable period of time). For instance, one
commenter noted that its requests for extensions due to public notice
procedures were refused by the Corps for the 2020 Nationwide General
Permits.
The Agency proposed at Sec. 121.6(d) to allow certifying
authorities and Federal agencies to jointly extend the reasonable
period of time in a written agreement, as long as the project proponent
was consulted, and the extension did not exceed one year from the
receipt of request for certification. The Agency also recognized that
there were circumstances under which the Federal agency should extend
the reasonable period of time without the certifying authority needing
to negotiate an agreement. Accordingly, the Agency proposed at Sec.
121.6(c) to identify two scenarios that would require the extension of
the reasonable period of time: force majeure events and public notice
procedures. Under the proposed rule, the certifying authority had to
notify the Federal agency through a written justification prior to the
end of the reasonable period of time. Upon notification, the reasonable
period of time would be extended by the period needed to fulfill public
notice procedures or the force majeure event, provided such extension
did not exceed one year from receipt of the request for certification.
The Agency is finalizing its proposed approach to extending the
reasonable period of time, including allowing certifying authorities
and Federal agencies to determine collaboratively whether and how the
reasonable period of time should be extended, as well as allowing for
automatic extensions in limited scenarios, as long as it does not
exceed one year. 40 CFR 121.6(d) and (e). The final rule approach
balances Federal agency and certifying authority equities better than
the 1971 Rule and the 2020 Rule for the reasons explained in this
section. This approach is consistent with the approach for joint
establishment of the reasonable period of time. It also aligns with
cooperative federalism principles central to the CWA. Although the
Agency is not finalizing the requirement to consult with the project
proponent, the final rule does allow for input from the project
proponent. The certifying authority and Federal agency should
communicate any extensions to the reasonable period of time to the
project proponent.
Most of the commenters who addressed extensions of the reasonable
period of time supported allowing certifying authorities and Federal
agencies to agree to extensions. A few commenters said that the Federal
agency should have the sole discretion to extend the reasonable period
of time, and another commenter said that the certifying authority
should be the only one to determine the extension. One commenter
suggested that extensions should be granted only if EPA finds that
unusual circumstances require a longer time. Some commenters
recommended that the project proponent should also be engaged in the
determination of extending the reasonable period of time. Multiple
commenters said that extensions agreed on by the Federal agency and
certifying authority should have justifiable and reasonable limits that
address the concerns of the project proponent. Conversely, other
commenters recommended that project proponents not be consulted but
rather notified about any extensions.
Consistent with the final rule's collaborative approach for setting
the reasonable period of time, EPA maintains that the Federal agency
and certifying authority should be able to jointly agree to extensions,
provided any extension does not exceed one year from the receipt of the
request for certification. Both the Federal agency and certifying
authority can provide insight on the length of time a review needs to
be extended, based on their knowledge of the Federal licensing or
permitting process and their knowledge of water quality and applicable
state or Tribal laws, respectively. The Agency is not finalizing
proposed text that would have required project proponent consultation.
Under this final rule, the project proponent does not play a role in
setting the reasonable period of time, see Sec. 121.6(b), so it is
unnecessary to provide the project proponent with a role in extensions.
Additionally, considering the annual average number of certification
requests,\52\ and therefore possible extension requests, EPA finds it
unreasonable to require project proponent consultation on all requests
for extension. However, the final rule does not prevent the certifying
authority and Federal agency from seeking input from the project
proponent. EPA also notes that this final rule allows certifying
authorities, in limited circumstances, to unilaterally extend the
reasonable period of time. The final rule recognizes that there are
circumstances the reasonable period of time should be extended without
the certifying authority needing to negotiate an agreement: where a
certification decision cannot be rendered within the reasonable period
of time due to force majeure events (including, but not limited to,
government closure or natural disasters) and where the state or Tribal
public notice and comment process takes longer than the negotiated or
default reasonable period of time.
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\52\ See footnote 51.
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All commenters who addressed extensions of the reasonable period of
time expressed support for extensions due to unforeseen circumstances
such as government closures or force majeure events. Several commenters
suggested that extensions should be limited only to such events and not
include public comment and other known procedures that were in place at
the time the reasonable period of time was established. Other
commenters expressed support for an expanded list of situations that
warrant automatic extensions and for maximum flexibility in terms of
extensions to address such things as public hearings, responding to
comments, revisions to the certification based on community engagement,
appeals under state laws, project complexity, and inadequate
information or unresponsive project proponents. A few commenters
supported defining specific situations warranting extensions for
efficiency and predictability, while a few commenters stated that the
final rule should not
[[Page 66590]]
include a defined list that would limit the circumstances under which
an extension can occur.
The Agency maintains that providing a limited list of scenarios
that warrant automatic extensions promotes efficiency and clarity,
while providing some flexibility for stakeholders when unforeseen
circumstances arise. EPA retained the accommodation for public notice
procedures in the list of circumstances warranting automatic extensions
to capture unanticipated occurrences such as extended public notice
periods. This approach also supports section 401's emphasis on public
notice opportunities and is consistent with the spirit of cooperative
federalism in balancing the interests of certifying authorities with
those of Federal agencies. However, to be clear, the Agency finds that
such extensions only apply to public notice procedures in effect at the
time the written notification for an extension is received. Due to the
final rule's collaborative approach to setting the reasonable period of
time, which allows for consideration of certifying authority public
notice procedures, the Agency expects that the need for automatic
extensions to accommodate public notice procedures will be rare.
Some commenters noted that the rule should provide more clarity
such as specifically defining public notice procedures and providing
more details on how extensions would work. In response to these
comments, the Agency has revised Sec. 121.6 to clearly differentiate
automatic extensions from agreed-upon extensions. Additionally, the
Agency has revised what is now Sec. 121.6(d) to clarify that in the
certifying authority's written notification to the Federal agency, it
must identify how much additional time is required by either the public
notice procedures or the force majeure event in addition to the
justification for such extension.
c. Withdrawal and Resubmissions of Requests for Certification
As proposed, EPA is removing Sec. 121.6(e) from the 2020 Rule,
which prohibited the certifying authority from asking the project
proponent to withdraw the certification request to reset the reasonable
period of time. Instead, the Agency is finalizing as proposed to take
no position on the legality of withdrawing and resubmitting a request
for certification.
Several commenters expressed opposition regarding EPA's decision
not to retain the 2020 Rule's regulatory text at Sec. 121.6(e) and the
approach not to take a position on the permissibility of withdrawing
and resubmitting a request for certification. Some commenters supported
the 2020 Rule's position on withdrawals and resubmittals, stating that
this position has helped ensure that the certification process cannot
be misused to delay or prevent issuance of the Federal license or
permit. Commenters expressed concern that EPA's proposed approach to
refrain from taking a position on the legality of withdrawing and
resubmitting a request for certification suggested that this process
may be used as a loophole to circumvent the one-year time limit
described in section 401, which would increase uncertainty, costs, and
indefinitely delay Federal licensing or permitting processes,
especially if there is an increase in litigation. Most of the
commenters opposed to EPA's proposed approach pointed out that Congress
was clear in its intent for including the statutory maximum one-year
period of time in section 401 to ``guard against a situation where the
water pollution control authority in the State in which the activity is
to be located . . . simply sits on its hands and does nothing.'' See
115 Cong. Rec. at 9,259 (starting debate on H.R. 4148, Water Quality
Improvement Act of 1969), 9,264-65 (amendment offered and discussed),
and 9,269 (amendment accepted) (Apr. 16, 1969). These commenters urged
EPA to retain the language of the existing regulation at 40 CFR
121.6(e) since Congress already created a ``bright line'' in section
401 of one year.
EPA disagrees with the above comments and is aware that,
historically under the 1971 Rule, certifying authorities sometimes
asked project proponents to withdraw and resubmit their requests for
certification to restart the clock and provide more time to complete
their certification review. Neither the text of section 401 nor Hoopa
Valley Tribe categorically precludes withdrawal and resubmission of a
request for certification. EPA understands and shares the concern
expressed by the D.C. Circuit in Hoopa Valley Tribe that prolonged
withdrawal and resubmission ``schemes'' might--under certain facts--
unreasonably delay and frustrate the Federal licensing and permitting
process. To be clear, EPA does not find that mere coordination between
the certifying authority and project proponent, as encouraged
throughout this preamble, rises to a withdrawal and resubmittal scheme.
Yet, the potential factual situations that might give rise to, and
potentially justify, withdrawal and resubmission of a request for
certification are so varied that the Agency is not confident that it
can create regulatory ``bright lines'' that adequately and fairly
address each situation. By EPA not taking a regulatory position on this
issue, it is up to project proponents, certifying authorities, and/or
possibly Federal agencies to determine on a case-by-case basis whether
and when withdrawal and resubmittal of a request for certification is
appropriate. Such determinations are ultimately subject to judicial
review based on their individual facts.
Other commenters expressed support for EPA's proposed approach of
not taking a position on the legality of withdrawal and resubmittal.
Some commenters acknowledged that flexibility is important for project
proponents and certifying authorities, while others described the need
for more guidance to reduce litigation on the withdrawal and
resubmittal practice. Conversely, some commenters expressed support for
withdrawal and resubmission in certain situations, encouraging EPA to
make clear in the final rule that withdrawal and resubmission of
requests for certification may occur except where there is evidence
that the certifying authority and applicant are attempting to collude
to thwart Congress's intention to avoid undue delay in processing
applications. A few commenters asserted that withdrawal and
resubmission of requests for certification may occur to avoid denials
of certification, and a few suggested that allowing a certifying
authority to discuss withdrawal and resubmittal with a project
proponent is in the project proponent's interest because they may be
able to avoid unnecessary denials of certification.
EPA recognizes that the practice of withdrawal and resubmittal has
been subject to litigation. The 2020 Rule prohibited the certifying
authority from asking the project proponent to withdraw the
certification request to reset the reasonable period of time. 40 CFR
121.6(e) (2020). In support of that position, the 2020 Rule relied on a
broad reading of the D.C. Circuit's decision in Hoopa Valley Tribe and
asserted that the regulatory text at Sec. 121.6(e) is a ``clear
statement that reflects the plain language of section 401 and . . . is
supported by the legislative history.'' 85 FR 42261. In that case,
which featured highly unusual facts,\53\ the court rejected the
particular
[[Page 66591]]
``withdraw and resubmit'' strategy the project proponents and states
had used to avoid waiver of certification for a FERC license. 913 F.3d
at 1105. The court held that a decade-long ``scheme'' to subvert the
one-year review period characterized by a formal agreement between the
certifying authority and the project proponent, whereby the project
proponent never submitted a new request, was inconsistent with the
statute's one-year deadline. Id. Significantly, the court said it was
not addressing the legitimacy of a project proponent withdrawing its
request and then submitting a new one, or how different a new request
had to be to restart the one-year clock. Id. at 1104.
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\53\ The court held that the project proponent and the
certifying authorities (California and Oregon) had improperly
entered into an agreement whereby the ``very same'' request for
state certification of its relicensing application was automatically
withdrawn and resubmitted every year for a decade by operation of
``the same one-page letter'' repeatedly submitted to the states
before the statute's one-year waiver deadline. 913 F.3d at 1104.
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On the other hand, at least three circuit courts have acknowledged
the possibility that withdrawal and resubmittal of a request for
certification may be a viable mechanism for addressing complex
certification situations. See NCDEQ, 3 F.4th at 676 (withdrawal and
resubmittal was appropriate where the certifying authority and project
proponent did not engage in a coordinated scheme to evade the
reasonable period of time); NYSDEC, 884 F. 3d at 456 (noting in dicta
that the state could ``request that the applicant withdraw and resubmit
the application''); Cal. State Water Res. Control Bd. v. FERC, 43 F.4th
920 (9th Cir. 2022) (vacating FERC orders where FERC had found that the
certifying authority had waived certification by participating in a
coordinated scheme to allow the project proponent to withdraw and
submit its application for certification before the reasonable period
of time expired).\54\ Additionally, EPA's guidance prior to the 2020
Rule acknowledged use of the withdrawal and resubmittal approach, as
well as the ``deny certification without prejudice to refile''
approach, but noted that ``[t]his handbook does not endorse either of
the two approaches. . . .'' 2010 Handbook at 13, n.7 (rescinded in
2019, see supra). With the dynamic case law related to the topic of
withdrawal and resubmittal and the complexities of certain
certification situations,\55\ EPA's approach in this final rule lets
certifying authorities, Federal agencies (e.g., as the project
proponent where it is the Federal agency issuing the license or
permit), and/or possibly project proponents take the lead in deciding
whether and when it is reasonable to allow withdrawal and resubmittal
of requests for certification. This final rule approach resets EPA's
interpretive position to silent and neutral on withdrawal and
resubmittal, where it was before the 2020 Rule.
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\54\ The respondent-intervenors in the Ninth Circuit case
petitioned the Supreme Court for certiorari but the Supreme Court
denied the petition on May 15, 2023. Nevada Irrigation District, et
al. v. Cal. State Water Res. Control Bd., et al., Docket. No. 22-
753.
\55\ Historically, certifying authorities and project proponents
have used the ``withdraw and resubmit'' approach for dealing with
the one-year deadline for complex projects. There are a multitude of
permutations, but the basic idea is that the project proponent would
withdraw the certification request and then resubmit a new
certification request either immediately or at some later date. The
Agency recognizes that there may be legitimate reasons for
withdrawing and resubmitting certification requests, including but
not limited to the following potential reasons: a new project
proponent, project analyses are delayed, and/or the project becomes
temporarily infeasible due to financing or market conditions.
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3. Implementation
As previously explained, EPA has added regulatory text to clarify
that the certifying authority and Federal agency may enter into written
agreements that establish categorical reasonable periods of time for
certain types of Federal licenses or permits. This regulatory text
gives the certifying authority and Federal agency the option of
establishing the reasonable period of time for certain categories of
Federal licenses or permits at any time without needing to wait until a
Federal license or permit application (or draft general Federal license
or permit) is submitted. For example, the certifying authority and
Federal agency could enter into an agreement that establishes a
reasonable period of time for all NPDES permits or for certain
categories of NPDES permits such as some general permits or minor
individual permits. The addition of the regulatory text regarding
written agreements was supported by some commenters who stated that the
final rule should allow the Federal agency and certifying authority to
agree in writing to categorical time periods for the certifying
authority to review certain types of permits, licenses, and/or
projects. These commenters noted that this was done prior to the 2020
Rule, and in the past, such agreements improved efficiency and
predictability by allowing Federal agencies, certifying authorities,
and project proponents (if applicable) to understand the reasonable
period of time prior to submitting an application. EPA agrees that the
addition of the regulatory text will allow for more efficiency and
predictability.
Commenters also noted that the proposed rule stated that the
reasonable period of time must be agreed upon within 30 days of the
receipt of request for certification, which suggested that categorical
agreements entered into prior to the date that the request for
certification was received would not satisfy the regulatory
requirement. EPA has addressed this concern by deleting the phrase
``within 30 days of receipt of a request for certification.'' By
deleting this phrase, the regulation makes clear that the Federal
agency and certifying authority may agree to a reasonable period of
time through written agreements that can be entered into prior to a
request for certification.
Several commenters identified specific types of permits and/or
processes that require a longer reasonable period of time than the
proposed 60-day default. Specifically, several commenters stated that
the 60-day default reasonable period of time would not align with the
concurrent Federal consistency reviews that are required for some
projects pursuant to the Coastal Zone Management Act (CZMA). In
addition, several commenters noted that FERC pipeline authorizations or
relicensing of hydroelectric dams can require up to one year. While
most of these comments are addressed through the establishment of a
longer default reasonable period of time of six months, EPA also notes
that these are the types of permits, licenses, and/or projects that
could warrant a categorical agreement between the Federal agency and
certifying authority to establish the appropriate reasonable period of
time. Furthermore, as discussed above, if a Federal agency establishes
a one-year reasonable period of time in regulation (e.g., FERC
regulations), it is unnecessary for the certifying authority and
Federal agency to negotiate because the certifying authority is already
provided the maximum amount of time statutorily allowed.
E. Scope of Certification
1. What is the Agency finalizing?
The Agency is finalizing its proposed approach to the scope of
certification at Sec. 121.3 with modifications to the regulatory text
to better clarify the extent of the activity subject to certification
and the water quality limitations inherent to section 401. The
finalized approach returns to the scope that is consistent with not
only the statutory language and congressional intent but also
longstanding Agency guidance and decades of Supreme Court case law. In
addition, EPA's final rule makes clear that a certifying authority's
review is limited to considering impacts to waters of the United States
except where a state or authorized Tribe has
[[Page 66592]]
state or Tribal laws that apply to waters of the state or Tribe.
The 2020 Rule substantially narrowed the scope of a certifying
authority's review. Before the 2020 Rule, a certifying authority
considered whether the whole ``activity'' subject to the Federal
license or permit will comply with applicable water quality
requirements. Under the 2020 Rule, the certifying authority could only
consider potential water quality impacts from the project's point
source ``discharges.'' See 85 FR 42229 (July 13, 2020). This
interpretation was heavily criticized by many states, Tribes, and non-
governmental organizations as unlawfully narrowing the certifying
authorities' scope of review under section 401 and was subject to
multiple legal challenges.
Having now carefully reconsidered the 2020 Rule's ``discharge-
only'' interpretation of scope of review, EPA has concluded that the
best reading of the statutory text is that the scope of certification
is the activity subject to the Federal license or permit, not merely
its potential point source discharges. This reading is further
supported by the legislative history of section 401, authoritative
Supreme Court precedent, and the goals of section 401, which include
recognition of the central role that states and authorized Tribes play
in protecting their own waters. It also realigns scope with accepted
practice for the preceding 50 years. Consistent with this
interpretation, EPA is finalizing revisions to Sec. 121.3 that
reaffirm the activity scope of review that Congress intended when it
first enacted the water quality certification provision in 1970 and
reaffirmed when it amended the CWA in 1972 and 1977. Additionally, in
response to comments, EPA is finalizing revisions to Sec. 121.3 that
clarify important limiting principles and provide greater regulatory
certainty.
The final rule at Sec. 121.3 provides that when a certifying
authority reviews a request for certification, the certifying authority
``shall evaluate whether the activity will comply with applicable water
quality requirements.'' It further provides that the certifying
authority's evaluation by the certifying authority is ``limited to the
water quality-related impacts from the activity subject to the Federal
license or permit, including the activity's construction and
operation.'' Finally, it provides that a certifying authority ``shall
include any conditions in a grant of certification necessary to assure
that the activity will comply with applicable water quality
requirements.'' 40 CFR 121.3
The final rule adopts the proposed scope of certification but with
textual edits made in response to public comment. First, the final rule
no longer divides its regulatory text regarding scope between two
separate sections of part 121. The Agency proposed a definition of
``activity as a whole'' at Sec. 121.1 and also addressed scope of
certification at Sec. 121.3. After considering public comment, the
Agency finds this structure unnecessary and confusing and instead has
incorporated its full interpretation of scope in final rule Sec.
121.3. See section IV.E.2.b of this preamble for further discussion.
Second, the Agency removed the phrase ``as a whole'' from the
regulatory text throughout part 121. This does not represent a change
in substance from proposal. The Agency does not interpret the terms
``activity'' and ``activity as a whole'' as having different meanings;
rather, EPA included the phrase ``as a whole'' in the proposed rule
simply to emphasize that a certifying authority's evaluation extends to
the activity in its entirety, as opposed to only the point source
discharges associated with the activity. After considering public
comment and the statutory text, EPA concludes that the final regulatory
text at Sec. 121.3 makes this clear without the need to add ``as a
whole'' and best reflects the statutory text. See section IV.E.2.b of
this preamble for further discussion.
Third, the final rule adds regulatory text clarifying that a
certifying authority's evaluation ``is limited to the water quality-
related impacts'' from the activity subject to the Federal license or
permit. This is not a change in substance from proposal. This concept
was captured in the proposed definition of activity as a whole at Sec.
121.1(a) (``activity as a whole means any aspect of the project
activity with the potential to affect water quality) and, in the
preamble at proposal, EPA was clear that section 401 is limited to
addressing only water quality-related impacts. 87 FR 35343 (June 9,
2022). EPA finds that this clarification best reflects the statutory
language and purpose of section 401. See section IV.E.2.c of this
preamble for further discussion.
Fourth, the proposal defined ``activity as a whole'' to mean any
aspect of the activity ``with the potential'' to affect water quality.
As discussed above, EPA is not finalizing that definition, and further,
the final regulatory text does not refer to ``potential'' to affect
water quality. 40 CFR 121.3(a). EPA made this change in response to
several commenters who questioned the breadth of the term
``potential,'' suggesting that the term ``potential'' authorized
certifying authorities to consider purely speculative ``potential''
impacts to water quality. EPA did not intend for its proposed language
to establish the required degree of causality between the activity and
the impact to water quality. The Agency finds it unnecessary to do so
in this rulemaking. Consistent with the statutory text and purpose of
section 401, final rule Sec. 121.3 clearly limits a certifying
authority's analysis of any given activity to the water quality-related
impacts that may prevent compliance with water quality requirements. It
is incumbent on the certifying authority to develop a record to support
its determination that an activity will or will not comply with
applicable water quality requirements. See section IV.E.2.b of this
preamble for further discussion.
Fifth, Sec. 121.3(b) provides that the scope of conditions in a
grant of certification is the same as the scope of review when acting
on a request for certification; certifying authorities are to impose
conditions ``necessary to assure that the activity will comply with
applicable water quality requirements.'' This is not a change in
substance from proposal. Proposed rule Sec. 121.7(d)(2) included the
same concept by requiring a grant with conditions to include ``[a]ny
conditions necessary to assure that the activity as a whole will comply
with water quality requirements,'' and EPA was clear at proposal that
the scope for the purpose of including conditions in a certification
and the scope of review for purposes of whether to grant certification
are the same. 87 FR 35346. EPA continues to find this interpretation
best aligns with the statutory text and purpose of section 401. See
section IV.E.2.e of this preamble for further discussion.
Next, EPA's final regulatory text provides that the certifying
authority's evaluation of the activity includes ``the activity's
construction and operation.'' At proposal, EPA explained that it did
not intend for its proposed scope to cover only those portions of the
activity directly authorized by Federal license or permit in question.
87 FR 35346. EPA specifically requested comment on this interpretation.
Id. After considering comments and the statutory text of section 401,
EPA is finalizing its proposed interpretation and including regulatory
text to reflect it. Specifically, final rule Sec. 121.3(a) states that
the certifying authority's evaluation includes ``the activity's
construction and operation'' without reference to whether the Federal
license or permit at issue covers both aspects of the activity.
[[Page 66593]]
The Agency focused on construction and operation because those are the
two aspects of an activity that Congress referenced throughout section
401. See section IV.E.2.b of this preamble for further discussion.
The Agency is also finalizing the definition of ``water quality
requirements'' at Sec. 121.1(j) as proposed (``Water quality
requirements means any limitation, standard, or other requirement under
sections 301, 302, 303, 306, and 307 of the Clean Water Act, any
Federal and state or Tribal laws or regulations implementing those
sections, and any other water quality-related requirement of state or
Tribal law''). The 2020 Rule narrowed the ability of certifying
authorities to include conditions in their certifications pursuant to
section 401(d) to protect the quality of their waters. Before the 2020
Rule, a certifying authority could add conditions to its certification
as necessary to assure compliance with the specifically enumerated
sections of the CWA and ``any other appropriate requirement of State
[or Tribal] law.'' 33 U.S.C. 1341(d). In the 2020 Rule, however, EPA
promulgated a narrow regulatory interpretation of the section 401(d)
term ``other appropriate requirements of State law,'' limiting it to
``state or tribal regulatory requirements for point source discharges
into waters of the United States.'' 40 CFR 121.1(n), 121.3 (2020); see
also 85 FR 42250. In this rulemaking, EPA is returning to an
interpretation of ``any other appropriate requirement of State law''
that is more closely aligned with the statutory text and more
environmentally protective. See further discussion at section IV.E.2.c
of this preamble.
The Agency also is finalizing an interpretation regarding which
waters a certifying authority can consider when determining whether to
grant certification. After considering public comment, the Agency
concludes that a certifying authority is limited to considering
``navigable waters'' as defined in the CWA, except where a state or
authorized Tribe has state or Tribal laws that apply to waters of the
state or Tribe. This interpretation is supported by the text of section
401 and reflected in prior Agency guidance. See section IV.E.2.d of
this preamble for further discussion.
As discussed below, the interpretations in this final rule of
section 401's scope of review and conditions reflect the best reading
of the statute. Even if some commenters may disagree that these
interpretations reflect the best reading, there can be no doubt that
they are imminently reasonable, for the same reasons articulated below
for why EPA's interpretation represents the best reading. They also
advance the water quality protection goals of section 401, are
consistent with the principles of cooperative federalism that underlie
the CWA and especially section 401, and restore the full measure of
authority that Congress intended to grant states and authorized Tribes
to protect their critical water resources.
2. Summary of Final Rule Rationale and Public Comment
The following subsections describe the Agency's finalization of the
five key aspects of the scope of a certification: (a) return to
activity scope of certification; (b) defining the ``activity'' subject
to certification; (c) water quality requirements; (d) waters considered
in acting on a request for certification, and (e) scope of conditions.
a. Return to ``Activity'' Scope of Certification Review and Conditions
Consistent with the proposal, EPA is returning the scope of
certification review and conditions to the ``activity'' subject to the
Federal license or permit. EPA is returning to the ``activity'' scope
because it best reflects congressional intent and appropriately
restores consistency with the ``activity as a whole'' scope that the
Supreme Court affirmed in PUD No. 1 over a quarter of a century before
the 2020 Rule. After reviewing the considerable number of comments
received on this aspect of the proposed rule, EPA concludes that the
``activity'' interpretation of scope affirmed by the Supreme Court in
1994 best reflects the statutory text, history, and purpose of CWA
section 401. By allowing states and authorized Tribes to protect their
water quality from the full activity made possible by a Federal license
or permit, this interpretation also effectuates Congress's goal of
maximizing protection of the nation's waters by providing an
independent grant of authority to states and authorized Tribes to
ensure that federally licensed or permitted activities do not frustrate
attainment of their water quality protection goals. See, e.g., 116
Cong. Rec. 8984 (1970) (explaining that the new certification
provisions were meant to ensure that ``[n]o State water pollution
control agency will be confronted [with] a fait accompli by an industry
that has built a plant without consideration of water quality
requirements''). Although this is a reversal of the approach taken by
the Agency in 2020, any disruption to the certification process will be
manageable in part because this final rule realigns scope with well-
established practice for the nearly 50 years preceding the 2020 Rule,
and all prior EPA interpretations, some dating from the 1980s.\56\
Also, the 2020 Rule, departing from this longstanding regime, was in
effect for only a few years. Further, the final rule addresses
stakeholder concerns regarding the pre-2020 Rule landscape and provides
regulatory certainty by clarifying important concepts such as how
certifying authorities are limited to considering adverse impacts to
water quality.
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\56\ All EPA interpretations of scope prior to the 2020 Rule
reflected the ``activity'' or ``project'' scope affirmed in PUD No.
1 and reinstated in this final rule. See e.g., Memorandum from
Catherine A. Winer to David K. Sabock, Section 401 Certification of
Marina (Nov. 12, 1985) (hereinafter, Winer Memorandum) (concluding
that ``section 401 may reasonably be read as . . . allowing state
certifications to address any water quality standard violation
resulting from an activity for which a certification is required,
whether or not the violation is directly caused by a `discharge' in
the narrow sense''); 1989 Guidance at 22 (``[I]t is imperative for a
State review to consider all potential water quality impacts of the
project, both direct and indirect, over the life of the project.'');
2010 Handbook at 17 (rescinded in 2019, see supra) (``Thus, it is
important for the [section] 401 certification authority to consider
all potential water quality impacts of the project, both direct and
indirect, over the life of the project.'').
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While disruption to the certification process will be modest, the
additional protections to water quality, on the other hand, are
significant. As commenters observed, the distinction between certifying
the activity and certifying only its associated discharges is more than
semantic and can in some cases have significant consequences. A point
source discharge emanates from a ``discernible, confined and discrete
conveyance.'' 33 U.S.C. 1362(14). Impacts to water quality from point
source discharges are a small subset of the water quality impacts that
may result from a federally licensed or permitted activity. For
example, as commenters observed, there are many situations where
reductions in stream flows or increases in thermal loading caused by
aspects of the federally licensed or permitted activity not directly
related to point source discharges can have devastating impacts on a
waterbody or watershed. This can be especially true in the dam context
(at issue in PUD No. 1), where construction and operation unrelated to
point source discharges can cause, among other adverse water quality
effects, a change in the timing and flow of water, blockage of
nutrients, and altered chemical makeup of water due to reservoirs. But
even beyond the dam context, the additional water quality protections
offered by an ``activity''-based scope may be significant for certain
types of federally licensed or
[[Page 66594]]
permitted activities, such as the construction and operation of a
pipeline project. See supra section IV.E.2.a.iv of this preamble.
Moreover, as explained in the following sections, an ``activity''-based
scope is consistent with the longstanding Supreme Court precedent of
PUD No. 1 and bolstered by additional textual support and the
legislative history.
i. The Supreme Court in PUD No. 1 Affirmed the Proper Scope of
Certification
The 2020 Rule rejected the scope of certification affirmed by the
Supreme Court in PUD No. 1, precedent in effect for a quarter of a
century. In PUD No. 1, the Court held, based on a textual analysis,
that section 401 ``is most reasonably read'' as authorizing the
certifying authority to place conditions on what the Court described as
the ``project in general'' or the ``activity as a whole'' once the
predicate existence of a discharge is satisfied. Id. at 711-12. Before
the Court was a section 401 certification issued by the State of
Washington for a new hydroelectric project on the Dosewallips River.
The principal dispute in PUD No. 1 was whether a certifying authority
could require a minimum stream flow as a condition in its section 401
certification. The project applicant identified two potential
discharges from its proposed hydroelectric facility: ``the release of
dredged and fill material during construction of the project, and the
discharge of water at the end of the tailrace after the water has been
used to generate electricity.'' Id. at 711. The project applicant
argued that because the minimum stream flow condition was unrelated to
these discharges, it was beyond the scope of the state's authority
under section 401. Id.
The Court examined sections 401(a)(1) and 401(d), specifically the
use of different terms in those paragraphs, to inform its
interpretation of the scope of a section 401 certification. The Supreme
Court, recognizing the ambiguity created when in 1972 Congress amended
the language in section 401(a)(1) and added section 401(d), held that
section 401(d) ``is most reasonably read'' as authorizing the
certifying authority to place conditions on the ``activity as a whole''
once the predicate existence of a discharge is satisfied. Id. at 711-
12. EPA agrees that section 401 is ambiguous regarding the scope of
certification and conditions, and EPA agrees with the Court's textual
analysis of the statute. The Court reasoned:
If Sec. 401 consisted solely of subsection (a), which refers to
a state certification that a ``discharge'' will comply with certain
provisions of the Act, petitioners' assessment of the scope of the
State's certification authority would have considerable force.
Section 401, however, also contains subsection (d), which expands
the State's authority to impose conditions on the certification of a
project. Section 401(d) provides that any certification shall set
forth ``any effluent limitations and other limitations . . .
necessary to assure that any applicant'' will comply with various
provisions of the Act and appropriate state law requirements. 33
U.S.C. 1341(d) (emphasis added). The language of this subsection
contradicts petitioners' claim that the State may only impose water
quality limitations specifically tied to a ``discharge.'' The text
refers to the compliance of the applicant, not the discharge.
Section 401(d) thus allows the State to impose ``other limitations''
on the project in general to assure compliance with various
provisions of the Clean Water Act and with ``any other appropriate
requirement of State law.'' Although the dissent asserts that this
interpretation of Sec. 401(d) renders Sec. 401(a)(1) superfluous,
post, at 726, we see no such anomaly. Section 401(a)(1) identifies
the category of activities subject to certification--namely, those
with discharges. And Sec. 401(d) is most reasonably read as
authorizing additional conditions and limitations on the activity as
a whole once the threshold condition, the existence of a discharge,
is satisfied.
Id. at 711-12 (emphasis in original).\57\ EPA agrees with the Court's
interpretation regarding the proper scope of certification.
Specifically, EPA agrees with the Court's analysis of section 401(a)(1)
and section 401(d). Because section 401(d) requires that a section
401(a)(1) certification include conditions necessary to assure the
``applicant . . . will comply'' with water quality requirements,
section 401 is most reasonably read to require the certifying
authority--when it reviews a request for certification under section
401(a)(1)--to review the applicant's activity subject to the Federal
license or permit, and not merely the potential point source
discharges. This is the best interpretation of the combined text of
sections 401(a)(1) and 401(d) partly because it accounts for the fact
that the activity is made possible by the applicant's Federal license
or permit, and that activity might involve a wide range of actions
beyond any potential discharge that could significantly affect
compliance with water quality requirements. In order to assure--as it
must under section 401(d)--that the ``applicant'' will comply with all
applicable water quality requirements, the certifying authority must be
able to evaluate water quality-related impacts from the activity made
possibly by the applicant's license or permit beyond those related to
its triggering discharge(s).
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\57\ Note that, as EPA felt the Supreme Court need not reach the
question of the scope of certification in PUD No. 1, the Agency did
not directly address this issue in its amicus brief. The amicus
brief filed by the Solicitor General on behalf of the EPA in this
case did not grapple directly with the language in sections 401(a)
and (d), and argued that ``[e]ven if a condition imposed under
Section 401(d) were valid only if it assured that a `discharge' will
comply with the State's water quality standards, the Section 40l(d)
condition imposed by the State in this case satisfies that test.''
Brief for the United States as Amicus Curiae Supporting Affirmance,
PUD No. 1, No. 92-1911 at 11, 12 fn. 2. (Dec. 1993).
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As suggested by the Court, it is significant that Congress chose to
use the term ``applicant'' in section 401(d), which it added to section
401 at the same time that it changed ``activity'' to ``discharge'' in
section 401(a)(1). Congress could easily have used the term
``discharge'' in section 401(d) as it did in section 401(a)(1) in place
of ``applicant'' and chose not to. Congress used similar phrasing in
other parts of the CWA. For example, CWA section 402 contemplates that
an NPDES permit may issue only upon a showing that a ``discharge will
meet'' various enumerated provisions. 33 U.S.C. 1342(a). Congress could
have used the same term (discharge) in section 401(d) but it did not.
EPA's interpretation of section 401 accounts for the distinct language
Congress employed. See Transbrasil S.A. Linhas Aereas v. U.S. Dep't of
Transp., 791 F.2d 202, 205 (D.C. Cir. 1986) (``[W]here different terms
are used in a single piece of legislation, the court must presume that
Congress intended the terms to have different meanings.'') (quoting
Wilson v. Turnage, 750 F.2d 1086, 1091 (D.C. Cir. 1984)).
In conclusion, EPA agrees with the Court's interpretation regarding
the proper scope of certification. Specifically, EPA agrees with the
Court's analysis of section 401(a)(1) and section 401(d), and, as
discussed below, has identified additional support for the Agency's
interpretation in the statutory text of section 401, the legislative
history of section 401, the water quality protection goals of section
401, and the principles of cooperative federalism that underlie the
CWA.\58\
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\58\ It is also instructive to note that a unanimous Supreme
Court left PUD No. 1 untouched in S.D. Warren, which found that
``[s]tate certifications under [section] 401 are essential in the
scheme to preserve state authority to address the broad range of
pollution . . .'' 547 U.S. at 386.
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ii. Additional Textual Support for ``Activity'' Scope of Certification
In PUD No. 1, the Court focused its analysis on sections 401(a)(1)
and (d). However, additional text in section 401(a)(1) and section
401(a)(3)-(5) adds
[[Page 66595]]
further support for a scope of review encompassing the activity subject
to the Federal license or permit, not just its discharges. Section
401(a)(1) provides that ``[i]n the case of any such activity for which
there is not an applicable [water quality requirement,\59\] the State
shall so certify . . .'' 33 U.S.C 1341(a)(1) (emphasis added).\60\ This
final rule interprets this language to mean that if the certifying
authority determines that no water quality requirements are applicable
to the activity, the certifying authority shall grant certification. 40
CFR 121.7(g). Important to interpreting scope, what matters for this
provision is whether there are water quality requirements applicable to
the ``activity,'' not the ``discharge.'' Congress added this provision
in the same 1972 act that changed ``activity'' to ``discharge'' earlier
in section 401(a)(1). Yet Congress used ``activity'' here. Congress's
use of ``activity'' in this provision of section 401(a)(1) instead of
``discharge'' adds further support to the conclusion that Congress
intended for the scope of certification to encompass the activity
subject to the Federal license or permit, not just its discharges.
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\59\ Specifically, the provision lists ``an applicable effluent
limitation or other limitation under sections 1311(b) and 1312
[301(b) and 302] of this title, and . . . an applicable standard
under sections 1316 and 1317 [306 and 307] of this title.'' As
discussed infra at section IV.E.2.c of this preamble, section
301(b), specifically section 301(b)(1)(C), incorporates by reference
section 303, and section 303 is not limited to regulating point
source discharges.
\60\ The provision goes on to say that any such certification
(of no applicable water quality requirements) ``shall not be deemed
to satisfy section 1371(c),'' i.e., CWA section 511(c) (pertaining
to the National Environmental Policy Act of 1969, 42 U.S.C. 4321 et
seq. (NEPA)).
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Section 401(a)(3)-(5) adds more support.\61\ Section 401(a)(3)
provides that a certification for the ``construction'' of a
``facility'' fulfills the section 401 obligations with respect to the
facility's ``operation'' unless the certifying authority determines
there is no longer reasonable assurance of compliance with water
quality requirements. See 33 U.S.C. 1341(a)(3). ``Construction'' and
``operation'' of a ``facility'' are clearly broader concepts than
``discharge.'' In addition, section 401(a)(4) allows the certifying
authority the opportunity to ``review the manner in which the
[previously certified] facility or activity shall be operated or
conducted'' prior to initial operation for the purpose of assuring this
will not violate applicable water quality requirements. See id. at
1341(a)(4). Reviewing how the ``facility or activity'' is ``operated or
conducted'' goes well beyond simply evaluating any related
``discharge.'' Continuing with this language, Congress provided that if
this review results in suspension of the facility or activity's Federal
license or permit, the license or permit remains suspended until
notification from the certifying authority that there is reasonable
assurance that ``such facility or activity''--not discharge--``will not
violate'' water quality requirements. Id. Lastly, section 401(a)(5)
provides that any certified Federal license or permit may be suspended
or revoked by the Federal licensing or permitting agency upon an entry
of judgment that ``such facility or activity,'' not discharge, has been
operated in violation of applicable water quality requirements. See id.
at 1341(a)(5). The scope of review employed in each of these
subsections is whether there has been compliance by the ``facility or
activity'' with the five CWA sections identified in section 401(a)(1)
(i.e., CWA sections 301, 302, 303, 306, and 307), and not merely
compliance by the ``discharge.'' Congress's choice to use broad words
such as ``facility'' and ``activity,'' rather than the narrower
``discharge,'' to describe what is subject to the substantive
requirements in section 401(a)(3)-(5) should be given meaning and is in
this final rule. For a discussion on the text of section 401(a)(2), see
section IV.K of this preamble, infra.
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\61\ See 87 FR 35344-45 (discussing section 401(a)(3)-(5) in
support of an ``activity'' based scope of certification).
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iii. Legislative History Confirms Congress Intended an Activity-Based
Scope
The legislative history of CWA section 401, and of its predecessor
section 21(b) of the Water Quality Improvement Act of 1970 where the
certification requirement was first enacted, provides persuasive
evidence that Congress intended the scope of certification to include
the activity subject to the Federal license or permit, not only its
point source discharges. As discussed in section III of this preamble,
Congress significantly revised the statutory water quality protection
framework in 1972, focusing more on effluent limitations and numeric
limits than water quality standards to try to drive down pollution
levels. While Congress largely retained the water quality certification
scheme it enacted in 1970, it did make several revisions, including
some in the subsections relevant to interpreting the scope of
certification. As discussed below the legislative history of the 1972
CWA amendments demonstrates that these changes were not intended to
significantly narrow the scope of section 401, contrary to what some
commenters argued and what EPA stated in its justification for the 2020
Rule.
The pre-1972 version of section 401 indisputably authorized
certifying authorities to review the entire activity, not only its
point source discharges. Congress originally enacted the water quality
certification requirement in section 21(b) of the Water Quality
Improvement Act of 1970. Public Law 91-224, 84 Stat. 91 (April 3,
1970). That section provided that any applicant for a Federal license
or permit to conduct any activity including, but not limited to, the
construction and operation of facilities, which may result in any
discharge into the navigable waters of the United States, ``shall
provide the licensing or permitting agency a certification from the
State in which the discharge originates or will originate . . . that
there is reasonable assurance . . . that such activity will be
conducted in a manner which will not violate applicable water quality
standards.'' Public Law 91-224, 21(b)(1), 84 Stat. 91 (April 3, 1970)
(emphasis added). Had this language remained untouched, there would be
no question regarding congressional intent; the 1970 language clearly
envisioned a broad ``activity'' scope of certification.
However, in 1972, Congress changed the above italicized language to
``such discharge will comply with the applicable provisions of sections
301, 302, 306, and 307 of this Act.'' Public Law 92-500, 401(a)(1), 86
Stat. 816 (Oct. 18, 1972). While Congress changed the word ``activity''
to ``discharge'' in this one instance when overhauling the CWA in 1972,
the rest of the legislative history of the 1972 amendments demonstrates
that Congress did not intend this one edit to section 401(a)(1) to
dramatically narrow the scope of certification.\62\ First, as discussed
above, Congress made other revisions in 1972 that demonstrate
Congress's intent to
[[Page 66596]]
retain a broader activity-based scope. Congress used the phrase ``such
activity'' (instead of ``such discharge'') in the very next sentence of
section 401(a)(1) and added section 401(d), which authorizes
certification conditions that assure that ``any applicant'' (instead of
``any discharge) will comply with water quality requirements. The broad
phrasing in section 401(a)(3)-(5) existed in section 21(b) and,
tellingly, was not revised by Congress in 1972. Further, the
legislative record shows that, in 1972, Congress understood it was
making only ``minor,'' insubstantial changes to section 21(b) to
harmonize with the substantial new provisions of the CWA pertaining to
regulation of point source discharges.\63\ The Senate Report stated
that section 401 was ``substantially section 21(b) of the existing
law.'' S. Rep. No. 92-414, at 69 (1971); see also remarks of Sen.
Baker: ``Section 21(b), with minor changes, appears as section 401 of
the pending bill S.2770.'' 117 Cong. Rec. 38857 (1971). Nowhere in the
legislative history is there a statement to the effect that Congress
intended to dramatically shrink section 401's scope of review and
protection to only those water quality effects caused by a potential
point source discharge. To the contrary, the House Report stated that
``[i]t should be clearly noted that the certifications required by
section 401 are for activities which may result in any discharge into
navigable waters.'' H.R. Rep. 92-911, at 124 (1972) (emphasis added).
Indeed, in summarizing section 401, Senator Muskie stated that ``[a]ll
we ask is that activities that threaten to pollute the environment be
subjected to the examination of the environmental improvement agency of
the State for an evaluation and recommendation before the Federal
license or permit be granted.'' 117 Cong. Rec. 38854 (1971) (emphasis
added). See also H.R. Rep. 92-911, at 121 (1972) (stating that ``[t]he
term `applicable' as used in section 401 . . . means that the
requirement which the term `applicable' refers to must be pertinent and
apply to the activity . . . .'') (emphasis added). In light of the lack
of any compelling evidence in the legislative history that Congress
intended to fundamentally constrain the certification power it granted
just two years before, and the abundant evidence to the contrary, EPA
adopts the full activity scope of review included in the proposed
rule.\64\
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\62\ While Congress was otherwise engaged in a ``total
restructuring'' of the CWA in 1972, Milwaukee v. Illinois, 451 U.S.
304, 317 (1981) (quoting legislative history of the 1972
amendments), Congress deemed the water quality certification scheme
so important that Congress carried it over, largely unchanged. Much
of the legislative history of the 1972 amendments focuses on the
total restructuring of the act, not explaining the pre-existing
certification requirement. The legislative history is accordingly
relatively sparse regarding certification. Much of the discussion
that does exist concerns the change from certifying compliance with
``applicable water quality standards'' (in the 1970 version) to
``the applicable provisions of sections 301, 302, 306, and 307'' of
the 1972 CWA. Congress amended section 401 in this way to reflect
its new strategy to more effectively advance water quality
protection and improvement; it is difficult to see why it would, at
the same time, significantly narrow the scope of certification so as
to undermine its power and effectiveness.
\63\ Indeed, the 1971 Senate Report provided that section 401
was ``amended to assure consistency with the bill's changed emphasis
from water quality standards to effluent limitations based on the
elimination of any discharge of pollutants.'' S. Rep. No. 92-414, at
69 (1971).
\64\ Congress's revisions to section 401 in the 1977 CWA
amendments also suggest continued support for a broader ``activity''
approach. As discussed more fully in section E.2.c below, in 1977,
Congress made further minor changes to section 401, this time
inserting section 303 into the list of CWA sections for which a
state must certify compliance. In the legislative history, Congress
explained this ``means that a federally licensed or permitted
activity, including discharge permits under section 402, must be
certified to comply with State water quality standards adopted under
section 303.'' H.R. Rep. No. 95-830, at 96 (1977) (emphasis added).
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iv. Response to Comments Regarding an Activity-Based Scope of
Certification
The Agency received numerous comments on the proposed return to an
activity-based scope of certification review, including comments about
the statutory language, legislative history, PUD No. 1, and the water
quality harms associated with the 2020 Rule. This subsection contains
summaries of these comments and the Agency's response. Comment
summaries and additional discussion of other aspects of scope of
certification (i.e., defining the ``activity'' subject to
certification, water quality requirements, waters considered in acting
on a request for certification, and scope of conditions) are included
elsewhere in this section of the preamble.
A. Comments Regarding the Language in Section 401
The best reading of the statutory text is that the scope of
certification is the activity subject to the Federal license or permit,
not merely its potential point source discharges. While the statutory
text lends itself to more than one conceivable interpretation, the
interpretation adopted in this final rule is the best reading of the
text and follows the Supreme Court's authoritative interpretation in
PUD No. 1. Some commenters asserted that the text of section 401
dictates a single interpretation of scope, although those commenters
disagreed on that interpretation. A few such commenters argued that
section 401(a)(1) unambiguously limits the scope of certification to
discharges, and that the reference in subsection 401(d) to the
``applicant's'' compliance does not create any ambiguity regarding the
scope of certification. Conversely, other commenters argued that the
statutory language of section 401 unambiguously provides for
certification on all aspects of the applicant's activity subject to the
Federal license or permit, not only its potential point source
discharges. A few of these commenters argued that the Court's holding
in PUD No. 1 was based on the unambiguous language of the statute.
EPA disagrees with both sets of commenters. Although the Supreme
Court's assessment of the statute in PUD No. 1 is the best reading of
the text with regard to the proper scope of certification, the text is
subject to more than one possible interpretation. EPA's conclusion is
supported not only by the two separate sets of commenters arguing in
support of contrary ``plain meaning'' interpretations of the proper
scope, but also by the Supreme Court's interpretation of the statute in
PUD No. 1. The Supreme Court held that the text regarding the scope of
certification ``is most reasonably read'' as pertaining to the
activity, the way EPA interprets the statute in this final rule. 511
U.S. at 712. In the 2020 Rule, EPA likewise acknowledged that the
statutory language addressing scope of review is subject to more than
one possible interpretation. See 85 FR 42232, 42251 (``The Agency also
disagrees with commenters who asserted that the scope of certification
is expressed unambiguously in section 401.''). Congress's use of
``discharge'' and ``activity'' in section 401(a)(1) and ``applicant''
instead of ``discharge'' in section 401(d) introduced some uncertainty
as to the proper scope of section 401 review and conditions. In this
final rule, EPA is following the Supreme Court's authoritative
interpretation of the statute while also exercising its authority
granted by Congress to construe, interpret, and implement the CWA.
B. Comments Regarding Statutory Interpretation
Some commenters asserted that EPA misconstrued section 401(d),
often reasserting arguments made in the preamble to the 2020 Rule or
the dissenting opinion in PUD No 1. Some commenters echoed arguments
made by the dissenting opinion in PUD No. 1 that section 401(a)(1)
limits a certifying authority to ``ensuring that any discharge
resulting from a project will comply'' with water quality requirements
and therefore, ``while Sec. 401(d) permits a State to place conditions
on a certification to ensure compliance of the `applicant,' those
conditions must still be related to discharges.'' 511 U.S. at 726
(Thomas, J., dissenting). Other commenters similarly argued that the
reference in section 401(d) to ``applicant'' merely indicates who must
comply with certification conditions. These comments are similar to the
position taken in the 2020 Rule that ``the term `applicant' in section
401(d) [was] merely identifying the
[[Page 66597]]
person or entity responsible for obtaining and complying with the
certification and any associated conditions and not as expanding the
regulatory scope of that section.'' 85 FR 42232.
EPA disagrees with the arguments made by these commenters, the
dissent in PUD No. 1, and the preamble to the 2020 Rule. First,
Congress could easily have used the term ``discharge'' in section
401(d) in place of ``applicant'' and chose not to. Congress used
similar phrasing in other parts of the CWA. For example, CWA section
402 contemplates that an NPDES permit may issue only upon a showing
that a ``discharge will meet'' various enumerated provisions. 33 U.S.C.
1342(a). In fact, Congress used this very phrasing in section
401(a)(1)--requiring certification that ``any such discharge will
comply.'' Id. at 1341(a)(1) (emphasis added). It is Congress's use of
these different phrases in section 401(a)(1) and section 401(d) that
led the Supreme Court to decide the issue in PUD No. 1 and now requires
the Agency to interpret the proper scope of certification. Congress
added section 401(d) in the same legislation in which it revised
section 401(a)(1) to refer to ``discharge.'' Congress could have used
the same term in section 401(d) but it did not. EPA's interpretation of
section 401(d) accounts for these considerations. Transbrasil, 791 F.2d
at 205 (D.C. Cir. 1986) (``[W]here different terms are used in a single
piece of legislation, the court must presume that Congress intended the
terms to have different meanings.'').
EPA disagrees with the commenters that suggested that section
401(d) is irrelevant to the scope of certification. Section 401(d)
requires the certifying authority--when making a decision to certify
under section 401(a)(1)--to include conditions necessary to assure that
the license or permit applicant will comply with water quality
requirements, including applicable requirements of state law listed
only in section 401(d). As the Court in PUD No. 1 recognized, section
401(d) is central to interpreting the scope of section 401. 511 U.S. at
711-712 (analyzing both section 401(a)(1) and section 401(d) to
interpret scope). Following this approach, this final rule adopts the
interpretation of section 401 that, when read as a whole, best aligns
with the language Congress chose for section 401(a)(1) and section
401(d), not just the language of section 401(a)(1).
C. Comments on Legislative History
Some commenters asserted that Congress's 1972 revisions to section
401(a)(1) support a ``discharge-only'' approach. These commenters
argued that, when Congress revised ``such activity'' to ``such
discharge,'' Congress unambiguously limited the scope of certification
to the ``discharge,'' rather than the ``activity.'' EPA disagrees that
the better interpretation of the 1972 revisions is that Congress
intended to narrow the scope of certification. That interpretation
considers only a portion of the 1972 amendments. It does not grapple
with how to reconcile the revisions to section 401(a)(1) with the
addition of section 401(d), which broadly authorizes certifying
authorities to condition certification decisions--made under section
401(a)(1)--to assure that the ``applicant'' complies with water quality
requirements. It also does not grapple with the use by the 1972
amendments of ``such activity'' later in section 401(a)(1), regarding
activities without applicable water quality requirements. When Congress
added section 401(d) and added the new sentence to section 401(a)(1)
regarding activities without applicable water quality requirements,
Congress could have used the term ``discharge'' but chose not to do so.
EPA's interpretation of section 401's scope must account for that
choice. Moreover, the commenter's interpretation does not harmonize
with the extensive legislative history suggesting that Congress had no
intention of substantially narrowing the certification power it had
previously granted to states. See section IV.E.2.a.iii of this
preamble, supra.
A couple of commenters asserted that Congress's revised
certification language reflected a new emphasis in the CWA on directly
regulating point source discharges of pollutants, away from indirectly
regulating activities through ambient water quality standards. The
preamble to the 2020 Rule made a similar point, that the 1972
amendments to section 401 made it ``consistent with the overall
framework of the amended statutory regime, which focuses on regulating
discharges to attain water quality standards and adds new federal
regulatory programs to achieve that purpose.'' 85 FR 42232. While EPA
agrees that the 1972 amendments reflected a new overall emphasis in the
CWA on regulating point source discharges (through section 402 NPDES
permits and section 404 dredge and fill permits), this does not change
EPA's conclusion regarding how best to interpret the scope of section
401. Section 401 predates these discharge-related permitting provisions
and, even after the 1972 amendments, remains significantly different in
character. It remains a direct congressional grant of authority for
states and authorized Tribes to protect their water resources from
impacts caused by federally licensed or permitted projects. As
discussed directly above at section IV.E.2.a.iii of this preamble, the
legislative history shows that when Congress was enacting new
discharge-related permitting provisions in 1972, it had no intention of
fundamentally constraining the certification power that Congress
granted just two years before.
D. Comments Regarding PUD No. 1
A few commenters asserted that the Court in PUD No. 1 relied on,
and deferred to, EPA's 1971 Rule and guidance derived from that rule.
One commenter asserted that the PUD No. 1 decision was based on
judicial deference to EPA regulations that predated the 1972 CWA
amendments and should be distinguished on this basis. Another commenter
asserted that the Court's reliance on the 1971 Rule significantly
undermines the validity and applicability of the PUD No. 1 decision for
this rulemaking. Similar to these commenters, the dissenting opinion in
PUD No. 1 also asserted that the majority relied ``at least in part''
on the 1971 Rule. 511 U.S. at 728-29 (Thomas, J., dissenting).
EPA first notes that the Court did not rely on EPA's 1971 Rule
during the Court's own analysis of the statutory text. The Court first
undertook its own examination of the statutory text, concluding that
section 401(d) ``is most reasonably read'' as authorizing conditions on
the entire activity at issue. Id. at 712. Only after reaching that
conclusion did the Court note that ``[o]ur view of the statute is
consistent with EPA's regulations implementing Sec. 401.'' Id.
Therefore, EPA disagrees with commenters that asserted that the Court's
analysis of the statutory text relied on the 1971 Rule. EPA also
disagrees with commenters that the Court's discussion of the 1971 Rule
undermines the applicability of PUD No. 1 for this rulemaking. As
described above, EPA is not concluding that the proper scope of
certification is the activity subject to the Federal license or permit
solely because that was the Supreme Court's holding in PUD No. 1,
although the Court's authoritative holding on the issue offers
compelling support. Instead, EPA has independently reviewed the
statutory text, and agrees with the Court's analysis of section
401(a)(1) and section 401(d). EPA finds further support for its
conclusion in additional statutory text of section 401 beyond what the
Court analyzed in PUD No. 1, the legislative
[[Page 66598]]
history of section 401, the water quality protection goals of section
401, and the principles of cooperative federalism that underlie the
CWA--particularly section 401 itself.
E. Comments Regarding Water Quality Harms of the 2020 Rule
As commenters observed, the distinction between certifying the
activity or only its associated discharges is more than semantic and
can in some cases have significant consequences for water quality
protection. For example, one commenter argued that the 2020 Rule's
narrower ``discharge-only'' approach to section 401 prohibited states
and Tribes from considering activities that can result in violations of
water quality requirements, such as impacts from reduced stream flows,
thermal loading from removal of streamside vegetation, increases or
decreases in sediment load, and destabilized stream banks. One
commenter argued that activities directly adjacent to streams and
wetlands have a direct relationship to the biological, physical, and
chemical components and overall health of the water resource. Another
commenter asserted that without the ability to consider the entire
activity subject to certification, states and Tribes would
underestimate the implications of projects on watershed scales and lose
capacity to manage designated uses. Several commenters specifically
discussed the importance of an activity-based scope for hydroelectric
dam projects. One commenter asserted that review under the 2020 Rule
left water quality impacts from a dam unmitigated, including a change
in the timing and flow of water, blockage of nutrients, and altered
chemical makeup of the water due to reservoirs. Similarly, another
commenter provided additional examples of the water quality impacts
from hydroelectric dams that are not tied to a specific discharge and
therefore left out under the 2020 Rule, including increased water
temperature from decreased water flows, vegetation loss and reduced
shading from dam reservoirs, fish kills from turbines, and increased
toxin mobility from elevated turbidity. A different commenter asserted
that the discharge from the powerhouse or tailrace of FERC-licensed
hydropower projects is not the only impact from those projects, but
rather the entire project fundamentally alters the chemical, physical,
and biological integrity of a river.
EPA is concerned that some, if not many, of the water quality-
related impacts identified by commenters might fall outside the scope
of review under the 2020 Rule's ``discharge-only'' approach to scope of
review. While the potential additional water quality protections
associated with the ``activity''-based scope (as opposed to a
``discharge-only'' scope) will vary depending on the nature, size,
location, and type of project that requires a Federal license or
permit, this final rule provides the opportunity for additional water
quality protections compared to the 2020 Rule's approach. For example,
when looking at a hydropower project, the ``activity'' scope allows a
certifying authority to consider water quality-related impacts beyond
the discharges from the tailrace or powerhouse. Depending on the
activity specifics, such consideration could result in certification
conditions that could include building or maintaining fish passage or
habitat restoration related to water quality protection. As another
example, when reviewing the construction of a pipeline project, the
``activity'' scope allows a certifying authority to consider water
quality-related impacts beyond the discharge of dredge or fill material
from the construction and placement of the pipeline and, depending on
the activity specifics, can include water quality impacts from non-
discharge related erosion or sedimentation from the pipeline
construction, as well as later water quality impacts from erosion or
sedimentation from the operation and maintenance of the pipeline.
Certifying authorities can consider certification conditions that
include monitoring, reporting, and adaptive management in response to
the non-discharge-related water quality impacts of the activity, such
as temperature, flow, riparian buffer conditions, and species
impacts.\65\ As another example, when reviewing the construction of a
boat marina, the ``activity'' scope allows a certifying authority to
consider not only the discharges associated with dredging and placement
of fill for the marina, but also, depending on the activity specifics,
erosion or sedimentation related to construction of the marina, as well
as water quality impacts related to the subsequent operation of the
marina (e.g., increased vessel pollution in the water associated with
increased vessel traffic due to the construction of the dock). See
section IV.E.2.b of this preamble, directly infra, regarding what is
included as part of the ``activity'' subject to certification. The
inability of states and authorized Tribes to protect against such
impacts under the 2020 Rule could seriously impair their ability to
protect valuable water resources. This would be inconsistent with
Congress's intention to provide states and authorized Tribes with a
powerful tool to prevent their water resources from being adversely
impacted by projects needing Federal licenses or permits.
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\65\ See also Economic Analysis for the Final Rule at section
4.5 for further discussion on the environmental benefits and
incremental costs associated with the final rule as compared to the
2020 Rule baseline.
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b. Defining the ``Activity'' Subject to Certification
As discussed above, the Agency is revising Sec. 121.3 regarding
scope of certification to clarify that a certifying authority's
evaluation is limited to the water quality related-impacts from the
activity subject to the Federal license or permit. This is the best
interpretation of the statutory language and is consistent with
congressional intent, the Agency's longstanding interpretation prior to
the 2020 Rule, and PUD No. 1. Although this reading had been the
Agency's longstanding interpretation prior to the 2020 Rule and should
be familiar to stakeholders, in response to comments and to aid in
implementation of this final rule, the Agency is providing further
clarification around the ``activity'' subject to certification.
The Agency proposed a definition of the term ``activity as a
whole'' at Sec. 121.1(a). In this final rule, the Agency is removing
the phrase ``as a whole'' from the regulatory text throughout part 121.
Although the Supreme Court used the phrase ``as a whole'' in PUD No. 1,
511 U.S. at 712, the phrase is not found in the statutory text. This
modification does not represent a change in substance from proposal.
The Agency does not interpret the terms ``activity'' and ``activity as
a whole'' as having different meanings; rather, EPA included the phrase
``as a whole'' in the proposed rule simply to emphasize that a
certifying authority's evaluation extends to the activity in its
entirety, as opposed to just the point source discharges associated
with the activity. EPA concludes that the final regulatory text at
Sec. 121.3 makes this clear without the need to add ``as a whole.''
The Agency has historically used the word ``activity'' to refer to the
scope of certification. See, e.g., 1989 Guidance at 8 (``If a State
grants water quality certification to an applicant for a federal
license or permit, it is in effect saying that the proposed activity
will comply with State water quality standards (and the other CWA and
State law provisions enumerated above).''), 23 (``all of the potential
effects of a proposed activity on water quality--direct and indirect,
short and long term, upstream and downstream, construction and
[[Page 66599]]
operations--should be part of a State's certification review.''); 2010
Handbook at 10 (rescinded in 2019, see supra) (``The granting of Sec.
401 water quality certification to an applicant for a federal license
or permit signifies that the state or tribe has determined that the
proposed activity and discharge will comply with water quality
standards as well as the other identified provisions of the CWA and
appropriate requirements of state or tribal law.''). The Court in PUD
No. 1 appeared to use the terms ``activity as a whole,'' ``activity,''
and even ``project in general'' interchangeably. PUD No. 1, 511 U.S. at
711-12. Accordingly, the Agency is removing the phrase ``as a whole''
to better reflect the statutory text and to reduce any confusion that
this phrase caused commenters.
The Agency proposed at Sec. 121.1(a) to define the term ``activity
as a whole'' to capture ``any aspect of the project activity with the
potential to affect water quality.'' EPA intended for this proposed
definition to provide certifying authorities with the ability to
consider any aspect of the federally licensed or permitted activity
that may adversely impact water quality. The impacts of a federally
licensed or permitted project on a certifying authority's water
resources may be caused by aspects of the project's activity other than
the potential discharge that triggered the need for a section 401
certification (e.g., non-discharge impacts from the construction and
operation of the project). The Agency's proposed definition for the
term ``activity as a whole'' was meant to include all aspects of the
proponent's ``project in general'' with the potential to affect water
quality. PUD No. 1, 511 U.S. at 711. Many commenters asserted that the
proposed definition was ambiguous, confusing, and circular. In light of
commenter concerns and in the interest of greater clarity, the Agency
is not finalizing the proposed definition for ``activity as a whole,''
and instead will rely on clarifying edits in final rule Sec. 121.3 to
articulate the activity subject to a certifying authority's review.
Consistent with its proposal, 87 FR 35345, the Agency finds that
section 401 is not constrained to those activities directly authorized
by the Federal license or permit in question. Section 401(a)(3)
provides compelling textual support for this reading. Specifically,
section 401(a)(3) makes clear that a certification for a Federal
license or permit for construction may address potential water quality
impacts from the subsequent operation even though the operation may be
subject to a different Federal license or permit. 33 U.S.C. 1341(a)(3)
(``The certification . . . with respect to the construction of any
facility shall fulfill the requirements of this subsection with respect
to certification in connection with any other Federal license or permit
required for the operation of such facility'' except in the
circumstances described in section 401(a)(3)). By providing that a
construction permit certification shall also serve as an operating
permit certification (unless notice is given of changes which call into
question whether the operation will in fact comply with water quality
requirements), section 401(a)(3) necessarily contemplates that the
certification of the construction permit will have considered whether
the subsequent operation will comply with water quality requirements.
EPA finds additional support for this interpretation in section
401(a)(4). That provision authorizes a certifying authority, after it
has granted certification for a facility or activity, to review, prior
to its initial operation, the manner in which a facility or activity
will be operated if the ``facility or activity is not subject to a
Federal operating license or permit.'' 33 U.S.C. 1341(a)(4). If the
certifying authority has already granted certification and the facility
or activity is not subject to a Federal operating license or permit, by
implication the certifying authority has certified a pre-operational
Federal license or permit such as a construction permit. Yet section
401(a)(4) tasks a certifying authority that has certified a
construction permit with reviewing the subsequent operation ``for the
purposes of assuring'' that ``the manner in which the facility or
activity shall be operated or conducted'' will not violate water
quality requirements. Id. (emphasis added). For this reason, section
401(a)(4) adds further support to EPA's conclusion that section 401 is
best read to authorize a certifying authority to consider all aspects
of the activity, not only those directly authorized by the relevant
Federal license or permit at hand.
This interpretation is consistent with EPA's longstanding position
before the 2020 Rule. Previously issued EPA guidance provided that
``because the States' certification of a construction permit or license
also operates as certification for an operating permit (except for in
certain instances specified in Section 401(a)(3)), it is imperative for
a State review to consider all potential water quality impacts of the
project, both direct and indirect, over the life of the project.'' 1989
Guidance at 22; 2010 Handbook at 17 (rescinded in 2019, see supra)
(``Thus, it is important for the [section] 401 certification authority
to consider all potential water quality impacts of the project, both
direct and indirect, over the life of the project.'') (citing PUD No.
1, 511 U.S. at 712 (1994)). Additionally, the Agency issued a
memorandum in 1985 discussing a question from a certifying authority
about whether a certification for a section 404 permit for the
construction of a marina could consider the subsequent operation of the
marina. Winer Memorandum. The Agency concluded, based largely on its
reading of section 401(a)(3), that when acting on a request for
certification for a section 404 permit for the construction of a
marina, the certifying authority will have considered water quality
impacts resulting from the subsequent operation of the marina.
The legislative history offers additional support for this
interpretation. The legislative history reveals Congress's intent to
ensure that federally licensed or permitted activities are not
considered in a piecemeal fashion; rather, Congress recognized the
importance of considering the effects of subsequent operations during
site selection, see S. Rep. No. 91-351, at 8 (August 7, 1969) (``Site
location is integral to effective implementation of the Nation's water
quality program. There are sites where no facility should be
constructed, because pollution control technology is not adequate to
assure maintenance and enhancement of water quality. Those who make the
decision on site location should be aware of this prior to making any
investment in new facilities.''), and of early planning to avoid later
adverse effects, see H.R. Rep. 91-127, at 6 (March 25, 1969) (``The
purpose of subsection 11(b) is to provide reasonable assurance . . .
that no license or permit will be issued by a Federal agency for an
activity that through inadequate planning or otherwise could in fact
become a source of pollution.''). After reviewing comments that the
Agency requested on the issue, EPA concludes that section 401 is best
read to authorize a certifying authority to consider all aspects of the
activity, not only those directly authorized by the relevant Federal
license or permit.
Accordingly, the revised text at final rule Sec. 121.3 indicates
that a certifying authority shall evaluate the water quality-related
impacts of the entire activity subject to the Federal license or
permit, including the construction and operation, and not solely the
aspect of the activity directly authorized by a given Federal license
or permit. For example, a section 401 certification on
[[Page 66600]]
a CWA section 404 permit authorizing the discharge of dredge or fill
material in waters of the United States may consider both the
construction associated with dredging (e.g., removing sediment from the
waterbody to place dock pilings) as well as the subsequent operation
associated with the completion of the dredging (e.g., increased vessel
pollution in the water associated with increased vessel traffic due to
the construction of the dock).
EPA requested comment on how a Federal licensing or permitting
agency could implement certification conditions addressing aspects of
the activity that the Federal agency does not otherwise have licensing
or permitting authority over. One commenter asserted that the bounds of
the permitting authority of the Federal permitting agency cannot
dictate the scope of state or Tribal authority under section 401,
observing that section 401(d) requires the Federal agency to
incorporate into the Federal license or permit those certification
conditions the state or authorized Tribe includes to ensure compliance
with water quality requirements. EPA generally agrees with this
commenter. Section 401 requires the certification conditions to become
conditions of the Federal license or permit subject to certification,
regardless of whether the Federal agency has independent authority to
condition its license or permit to ensure compliance with water quality
requirements. However, EPA emphasizes that--for purposes of section
401--certification conditions cannot ``live on'' past the expiration of
the Federal permit to which they attach. Section 401(d) requires
certification conditions to be incorporated into the Federal license or
permit. Accordingly, once the Federal license or permit expires, any
certification conditions incorporated into the Federal license or
permit also expire. This principle holds true regardless of the scope
of section 401. However, it does not mean that when a certifying
authority considers whether to grant or deny certification, the
certifying authority is limited to considering only those aspects of
the activity that will occur before the expiration of the Federal
license or permit. For example, if the certifying authority determines
that no conditions could assure that the activity, including post-
expiration aspects of the activity, will comply with water quality
requirements, denial of certification would be appropriate.
A few commenters asserted that the definition for ``activity as a
whole'' could be used by certifying authorities to impose conditions on
activities that may only be speculatively or obscurely linked to the
actual discharge. In addition, a few commenters requested that the
Agency revise the proposed definition for ``activity as a whole'' to
provide more clarity on the boundaries of such a term, such as what
impacts can be considered by the certifying authority and how indirect
the impacts may be to water quality.
In response to comments, the Agency revised its explanation of the
``activity'' approach from proposal to provide more clarity. Although
each determination will be fact specific, the Agency is clarifying
important limiting principles that inform delineation of the
``activity'' under review by the certifying authority. The Agency finds
that its approach to ``activity'' in this final rule is appropriately
bounded to allow certifying authorities to only consider adverse
impacts to waters that prevent compliance with water quality
requirements. The final text at Sec. 121.3 also makes it clear that
the analysis is limited to the applicant's activity subject to the
Federal license or permit at issue (and to considering that activity's
adverse impacts on water quality). Consistent with the intent of the
proposed rule, Sec. 121.3 in the final rule clearly limits a
certifying authority's analysis of any given activity to adverse water
quality-related impacts that may prevent compliance with water quality
requirements. As discussed below, the phrase ``will comply'' used in
sections 401(a)(1) and 401(d) means that the certifying authority is
limited to examining whether the activity will meet water quality
requirements; only if the activity will not comply with such
requirements, does section 401 authorize certifying authorities to
either condition the activity in such way to ensure compliance or deny
the activity where compliance cannot be ensured with conditions.
Accordingly, section 401 and this final rule do not authorize
certifying authorities to deny or condition a certification due to
impacts from the activity that do not adversely affect water quality.
However, the Agency wishes to make clear that certifying authorities
may address not only adverse water quality impacts caused exclusively
by the federally licensed or permitted activity, but also adverse
impacts contributed to by a federally licensed or permitted activity.
For example, a certifying authority may deny or condition an activity
that will contribute to ongoing noncompliance with water quality
requirements. Relatedly, section 401 and this final rule do not
authorize a certifying authority to condition an activity for the
purpose of protecting waters that are not impacted by the activity or
include conditions that do not otherwise affect compliance with the
applicable water quality requirements in the waters impacted by the
activity.
The Agency also finds it unnecessary to establish in this
rulemaking how indirect or certain the impacts of the activity may be
to water quality. It is incumbent on the certifying authority to
develop a record to support its determination that an activity will or
will not comply with applicable water quality requirements. The Agency
encourages certifying authorities to clearly state in a certification
decision why a condition is necessary to assure that the activity will
comply with water quality requirements or, in a denial, why it cannot
certify that the activity will comply with water quality requirements.
See 40 CFR 121.7; see also infra section IV.F of this preamble. If the
project proponent believes the certification decision is premised on,
in the words of one commenter, a ``statistically insignificant aspect
of the project,'' it may challenge the sufficiency of the decision in a
court of competent jurisdiction. If a project proponent believes a
certification decision is based on unreasonable conclusions regarding
the water quality-related impacts of the activity, it may likewise
challenge that decision in court. This outcome is consistent with
congressional intent. The legislative history reveals that Congress
intended project proponents to seek relief in state courts in instances
where it disagreed with a certification decision. See, e.g., 116 Cong.
Rec. 8805, 8988 (1970) (Conf. Rep.) (``If a State refuses to give a
certification, the courts of that State are the forum in which the
applicant must challenge that refusal if the applicant wishes to do
so.''); H.R. Rep. No. 92-911, at 122 (1972) (same).
One commenter argued that the Agency had not adequately explained
how the ``activity as a whole'' scope would function in practice, and,
as a result, the definition would introduce regulatory uncertainty,
pose litigation risk regarding certification decisions, and threaten
infrastructure projects. The Agency disagrees. When PUD No. 1 endorsed
a scope of ``activity as a whole'' almost thirty years ago, the Court
did not offer a specific definition or explanation of that term.
Nevertheless, certifying authorities and Federal agencies have gained
significant experience over nearly 50 years implementing an
``activity'' approach, and EPA expects that certifying authorities and
Federal agencies remain capable of appropriately delineating the
[[Page 66601]]
``activity'' based on the facts of each situation. EPA is not aware of
and did not receive any comments identifying any cases in which
delineation of ``activity'' has been litigated, provided that the scope
of review was limited to water quality. Moreover, this final rule
addresses commenter concerns regarding regulatory certainty by
clarifying important limiting principles that inform delineation of the
``activity'' under review by the certifying authority including that
certifying authorities are limited to considering adverse impacts to
water quality from the activity subject to the Federal license or
permit. See supra for further discussion.
c. Water Quality Requirements
As proposed, EPA is finalizing the definition of water quality
requirements as ``any limitation, standard, or other requirement under
sections 301, 302, 303, 306, and 307 of the Clean Water Act, any
Federal and state or Tribal laws or regulations implementing those
sections, and any other water quality-related requirement of state or
Tribal law.'' 40 CFR 121.1(j). The final rule definition is consistent
with congressional intent as well as long-standing Agency
interpretation of the CWA. A fundamental factor in the scope of a
section 401 certification is that the certifying authority is limited
to considering whether the activity will comply with applicable water
quality requirements. See 33 U.S.C. 1341(a), (d). This serves as a key
limitation on the otherwise broad authority granted by Congress to
certifying authorities. As discussed in more detail below, this
approach was supported by the overwhelming majority of commenters on
the proposed rule.
i. Water Quality-Related Impacts From Federally Licensed or Permitted
Projects
EPA is finalizing that when a certifying authority reviews a
request for certification, ``[t]he certifying authority's evaluation is
limited to the water quality-related impacts from the activity subject
to the Federal license or permit, including the activity's construction
and operation.'' 40 CFR 121.3(a) (emphasis added). This limitation to
evaluating water quality-related impacts was included in EPA's proposed
definition of ``activity as a whole''--``any aspect of the project
activity with the potential to affect water quality''--and EPA's
proposal was clear that section 401 is limited to addressing only water
quality-related impacts. 87 FR 35343.
The CWA's overall objective is ``to restore and maintain the
chemical, physical, and biological integrity of the Nation's waters.''
33 U.S.C. 1251(a). Among the Act's policy declarations is ``the policy
of Congress to recognize, preserve, and protect the primary
responsibilities of States to prevent, reduce, and eliminate
pollution.'' Id. at 1251(b). When Congress gave certifying authorities
the ability to review any activity subject to a Federal license or
permit that may result in a discharge into waters of the United States,
it added a key limiting principle to that otherwise broad authority--
the review is limited to determining compliance with water quality
requirements. From its first inclusion of then-section 21(b) in the
Water Quality Improvement Act of 1970, Congress intended to provide
states and Tribes with a powerful tool to prevent their water resources
from being adversely impacted by projects needing Federal licenses or
permits. See 116 Cong. Rep. 8805, 8984 (March 24, 1970) (``Mr. Muskie:
No polluter will be able to hide behind a Federal license or permit as
an excuse for a violation of water quality standard.''). Although
Congress has changed the words and phrases that convey that limitation,
legislative history shows consistent congressional intent over time.
See, e.g., S. Rep. 92-414, at 1487 (1971) (``The purpose of the
certification mechanism provided in this law is to assure that Federal
licensing or permitting agencies cannot override State water quality
requirements.''). In short, Congress intended section 401 to provide
certifying authorities with broad authority with respect to protecting
water quality within their jurisdiction but specifically confined that
authority to water quality.
Judicial and EPA interpretation on this point also have remained
constant. The courts have consistently agreed that certifying
authorities are limited to considering water quality effects. See PUD
No. 1, 511 U.S. at 711-713 (holding that a state's authority to impose
conditions under section 401(d) ``is not unbounded''); see also Am.
Rivers, Inc. v. FERC, 129 F.3d 99, 107 (2d Cir. 1997) (``Section
401(d), reasonably read in light of its purpose, restricts conditions
that states can impose to those affecting water quality in one manner
or another.''). The same is true for prior Agency interpretations, as
articulated in the 2020 Rule and in prior Agency guidance. See 85 FR
42250; 1989 Guidance at 22 (``[I]t is imperative for a State review to
consider all potential water quality impacts of the project, both
direct and indirect, over the life of the project.'').\66\
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\66\ It is also consistent with EPA's interpretation in the 1971
Rule regarding section 21(b) in the Water Quality Improvement Act of
1970 (the precursor to current section 401). See, e.g., 40 CFR
121.2(a)(3) (2019) (certification decisions concern whether ``the
activity will be conducted in a manner which will not violate
applicable water quality standards'').
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The overwhelming majority of commenters agreed that the scope of
section 401 certification is limited to water quality. Accordingly,
while EPA continues to interpret section 401 as providing broad
authority to certifying authorities to review activities subject to a
Federal license or permit, the review must be limited to the water
quality-related impacts from the activity. It would be inconsistent
with the purpose of CWA section 401 to deny or condition a section 401
certification based on potential impacts that have no connection to
water quality (e.g., based solely on potential air quality, traffic,
noise, or economic impacts that have no connection to water quality).
Several commenters asserted that certifying authorities considered
non-water quality-related factors prior to the 2020 Rule and provided
examples of such factors and the consequences, including project
delays, ambiguity, and undue burdens on project proponents. A few
commenters asserted that a handful of states have attempted to block or
constrain projects based on non-water quality-related reasons and
discussed specific certification actions as ``state abuse'' of section
401. Based on commenter feedback and EPA's experience implementing
section 401, EPA finds that the vast majority of certification
decisions are based entirely on water quality considerations.
Nevertheless, the final rule reiterates that certifying authorities are
limited to considering the water quality-related impacts from an
activity when determining whether to issue a section 401 certification.
See Sec. 121.1(j), 121.3.
A few commenters asserted that the proposed rule would allow
certifying authorities to condition or deny projects as long as there
is a nexus to water quality. These commenters argued that the proposed
rule would allow states to block projects for non-water quality
reasons, which the commenters asserted include effects on designated
uses of a water body that are not associated with water quality changes
(e.g., changes in water flow that might affect aquatic habitat). EPA
strongly disagrees that this final rule would permit certifying
authorities to consider non-water quality-related factors as the basis
for a certification denial or condition. The scope of certification is
limited to adverse water quality-related impacts from the activity.
That said, water quality-related impacts can encompass impacts that
adversely affect the
[[Page 66602]]
chemical, physical, and biological integrity of waters, which could
include, for example, changes in water flow that might affect aquatic
habitat. EPA has consistently interpreted water quality impacts
broadly. See, e.g., 1989 Guidance at 22 (``all of the potential effects
of a proposed activity on water quality--direct and indirect, short and
long term, upstream and downstream, construction and operation--should
be part of a State's certification review''); 2010 Handbook at 17
(rescinded in 2019, see supra) (``Thus, it is important for the
[section] 401 certification authority to consider all potential water
quality impacts of the project, both direct and indirect, over the life
of the project''). In 1991, EPA sent a letter to FERC in response to
various FERC documents discussing ``inappropriate'' section 401
certification conditions, including conditions related to fish,
wildlife, vegetation, and recreation. Letter from LaJuana S. Wilcher,
Assistant Administrator of the Office of Water, to Lois D. Cashell,
FERC Secretary (Jan. 18, 1991). In this letter, EPA expressly rejected
the notion that water quality is a narrow concept; rather, the Agency
asserted that the ``protection of water quality includes protection of
multiple elements which together make up aquatic systems including the
aquatic life, wildlife, wetlands and other aquatic habitat, vegetation,
and hydrology required to maintain the aquatic system.'' Id. The letter
further noted that water quality issues can include toxic pollutants,
pollutant bioaccumulation, aquatic species composition and diversity,
habitat loss, stormwater impacts, nonpoint source impacts, and
hydrological changes. Id. The Agency finds that a multi-faceted
interpretation of water quality-related impacts represents the best
interpretation of section 401 and best allows certifying authorities to
realize the water quality protection goals of the CWA and section 401.
ii. Definition of Water Quality Requirements
To clarify which provisions of Federal, state, and Tribal law a
certifying authority may consider when evaluating and ultimately
deciding which action to take on a request for certification, the
Agency is finalizing the definition of ``water quality requirements''
as proposed (``Water quality requirements means any limitation,
standard, or other requirement under sections 301, 302, 303, 306, and
307 of the Clean Water Act, any Federal and state or Tribal laws or
regulations implementing those sections, and any other water quality-
related requirement of state or Tribal law.''). See 40 CFR 121.1(j).
The term ``water quality requirements'' is used throughout section
401, and the term ``any other appropriate requirement of State law'' is
used in section 401(d), but neither term is defined in the CWA. The
Agency did not interpret the terms ``water quality requirements'' and
``other appropriate requirement of State law'' in the 1971 Rule, as
they were not introduced into the statute until the 1972 CWA
amendments. Prior to 1972, what is now section 401(a) of the statute
used the term ``water quality standards,'' and section 401(d) was not
part of the statute. See Public Law 91-224, 21(b)(1), 85 Stat. 91
(1970); Public Law 92-500, 401, 85 Stat. 816 (1972).
The 2020 Rule defined the term ``water quality requirements'' and
interpreted the statutory phrase ``any other appropriate requirement of
State law.'' 40 CFR 121.1(n) (2020); see 85 FR 42253. Consistent with
what EPA characterized as the ``discharge-only'' scope of section 401
certification, the 2020 Rule limited ``water quality requirements'' to
only the enumerated provisions of the CWA listed in section 401(a)(1)
and ``state or tribal regulatory requirements for point source
discharges into waters of the United States.'' 40 CFR 121.1(n) (2020).
Citing Justice Thomas's dissent in PUD No. 1, the Agency relied on the
principle of ejusdem generis (``of the same kind'') to argue that the
term ``appropriate requirement of State law'' was limited ``only to
provisions that, like other provisions in the statutory list, impose
discharge-related restrictions.'' 511 U.S. at 728 (Thomas, J.,
dissenting); 85 FR 42453. As a result, the 2020 Rule narrowed the scope
of review and ability of certifying authorities to include conditions
to protect their water quality. For example, a few commenters asserted
that the 2020 Rule's approach to water quality requirements impeded
certifying authorities' ability to impose conditions that protect water
quality, such as standards for erosion and sedimentation control,
stormwater management, endangered species protection, minimum in-stream
flows, prevention of aquatic habitat loss, and prevention of
groundwater contamination. A few other commenters stressed the
importance of this authority for FERC licensed projects in particular
because of the length of the license and preemption of state regulatory
oversight on FERC licenses.
In finalizing the definition of ``water quality requirements'' as
proposed, the Agency has reconsidered the 2020 Rule's definition of the
term and finds that section 401 is best interpreted in a way that
respects the breadth of the Federal and state and Tribal water quality-
related provisions that Congress intended a certifying authority to
consider when determining whether to grant certification. Accordingly,
EPA is defining ``water quality requirements'' to include any
limitation, standard, or other requirement under the provisions
enumerated in section 401(a)(1), any Federal and state or Tribal laws
or regulations implementing the enumerated provisions, and any other
water quality-related requirement of state or Tribal law--regardless of
whether they apply to point or nonpoint source discharges. See 40 CFR
121.1(j); 87 FR 35347 (noting that the proposed definition applied to
state or Tribal water quality requirements regardless of whether they
apply to point or nonpoint source discharges).
Many commenters supported the proposed approach to ``water quality
requirements,'' including its inclusion of state and Tribal laws
applying to either point and nonpoint sources, noting it is more
holistic, consistent with the Act and its purpose, consistent with case
law, and that it restores and reinforces the authority Congress
reserved for states and Tribes. However, several commenters did not
support the proposed approach to defining ``water quality
requirements,'' arguing that the term should be limited to point source
discharges and/or limited to whether the discharge complies with water
quality standards. A few commenters asserted that the term ``water
quality-related requirements of state or Tribal law'' was too broad and
would allow certifying authorities to include conditions unrelated or
weakly related to water quality. Conversely, several other commenters
believed the proposed definition of ``water quality requirements'' was
overly restrictive, including a few commenters who recommended removing
the term ``water quality-related'' in the definition for water quality
requirements. As discussed below, EPA finds that its definition of
``water quality requirements'' is the best interpretation considering
the text of section 401 and appropriately allows certifying authorities
to certify compliance with the enumerated provisions of the CWA and
state and Tribal water quality-related provisions (for both point and
nonpoint sources). EPA's final definition is also supported by the
purpose, and legislative history of the statute.
First, the wording that Congress used in the text of section 401
demonstrates
[[Page 66603]]
that the certifying authority's review is limited to water quality-
related provisions. Looking at the text of the various subsections of
section 401, each subsection that refers to the act of certifying
either uses the phrases ``effluent limitation,'' ``quality of waters,''
or ``water quality requirements,'' or explicitly enumerates subsections
of the CWA having to do with water quality--section 301 (effluent
limitations), section 302 (water quality-related effluent limitations),
section 303 (water quality standards and implementation plans), 306
(national standards of performance), and 307 (toxic and pretreatment
effluent standards). See 33 U.S.C. 1341(a), (d).
Second, the text is not limited to certifying compliance with
provisions addressing point source discharges. Section 401(d) includes
the phrase ``any other appropriate requirement of State law.'' 33
U.S.C. 1341(d) (emphasis added). The phrase ``any other appropriate''
bears examination. The word ``any'' is capacious in its scope,
literally meaning ``all'' such state law requirements and not just a
limited subset such as point source-related requirements. See Ali v.
Federal Bureau of Prisons, 552 U.S. 214 (2008); Harrison v. PPG
Industries, 446 U.S. 578 (1980). The word ``other'' refers to
requirements aside from the statutory provisions listed in the
preceding list in section 401(d) (CWA section 301, etc.). While the
word ``appropriate'' provides a limiting principle with respect to
which requirements may be considered and applied, the word
``appropriate'' is to be interpreted broadly in light of the statute's
text and purpose. Michigan v. EPA, 576 U.S. 743, 752 (2015) (stating
that ``appropriate'' is a broad and all-encompassing term that
naturally and traditionally includes consideration of all the relevant
factors). In this context, the phrase ``any other appropriate'' is best
understood as allowing certifying authorities to consider state or
Tribal laws regarding water quality that are not part of the enumerated
list of CWA sections and that address water quality protections that
are different from those covered by the enumerated list. See also PUD
No. 1, 511 U.S. at 713 (declining to speculate on the scope of state
laws that would be included in the phrase ``any other appropriate
requirement of state law'' but finding that, ``at a minimum,
limitations imposed pursuant to state water quality standards adopted
pursuant to Sec. 303 are `appropriate' requirements of state law'').
Application of the maxim ejusdem generis (``of the same kind'') to
limit ``appropriate requirement of State law'' to only those state law
provisions that impose discharge-related or point source-related
restrictions is misplaced. The list of CWA provisions referenced in
sections 401(a)(1) and 401(d) includes section 303,\67\ which is not
limited to regulating point-source discharges. Section 303 concerns
establishment of water quality standards, identification of waters that
do not meet those standards, and establishment of daily maximum
pollutant loads for such waters, all of which go well beyond regulation
of point source discharges.\68\ Considering the breadth of section 303,
using ejusdem generis to interpret ``any other appropriate requirement
of State law'' to only apply to point sources is not consistent with
congressional intent as expressed through the statutory text.
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\67\ See H.R. Rep. No. 95-830, 96 (Dec. 6, 1977) (``The
inserting of section 303 into the series of sections listed in
section 401 is intended to mean that a federally licensed or
permitted activity, including discharge permits under section 402,
must be certified to comply with State water quality standards
adopted under section 303. The inclusion of section 303 is intended
to clarify the requirements of section 401. It is understood that
section 303 is required by the provisions of section 301. Thus, the
inclusion of section 303 in section 401 while at the same time not
including section 303 in the other sections of the Act where
sections 301, 302, 306, and 307 are listed is in no way intended to
imply that 303 is not included by reference to 301 in those other
places in the Act, such as sections 301, 309, 402, and 509 and any
other point where they are listed. Section 303 is always included by
reference where section 301 is listed.''); see also PUD No. 1, 511
U.S. at 712-13 (``Although Sec. 303 is not one of the statutory
provisions listed in Sec. 401(d), the statute allows States to
impose limitations to ensure compliance with Sec. 301 of the Act,
33 U.S.C. 1311. Section 301 in turn incorporates Sec. 303 by
reference.'')
\68\ A primary objective of section 303 is the establishment of
water quality standards. Establishment of water quality standards is
required for waters regardless of whether they receive point source
discharges. 33 U.S.C. 1313(c). Non-attainment of standards may be
due to point sources, nonpoint sources, or both. As explained in
EPA's regulations, water quality standards ``serve the dual
purposes'' of serving as the regulatory basis for establishing water
quality based treatment controls for point source discharges and the
broader purpose of establishing the water quality goals for a
specific water body. 40 CFR 130.3. Section 303(d) specifically
directs the identification of waters that do not meet water quality
standards, considering both point sources and nonpoint sources of
pollution. 33 U.S.C. 1313(d)(1)(A); see also 40 CFR
130.7(b)(1)(iii). Section 303(d) also addresses the establishment of
a ``total maximum daily load'' for each water that does not meet
standards, set at a level necessary to implement applicable water
quality standards--again, considering both point sources and
nonpoint sources. 33 U.S.C. 1313(d)(1)(C); see also 40 CFR 130.1(i)
(defining total maximum daily load as the sum of loads from both
point sources and nonpoint sources plus natural background).
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The legislative history also supports a definition of ``water
quality requirements'' not limited to requirements for point source
discharges. As described earlier, even though in 1972 Congress modified
the language of then-section 21(b), the legislative history shows that
Congress intended new section 401 to be substantially the same as
section 21(b), which did not limit certifying authorities to
considering only point source discharges. In 1972, Congress understood
it was making only ``minor,'' insubstantial changes to section 21(b).
The Senate Report stated that section 401 was ``substantially section
21(b) of the existing law.'' S. Rep. No. 92-414, at 69 (1971). See also
remarks of Sen. Baker: ``Section 21(b), with minor changes, appears as
section 401 of the pending bill S.2770.'' 117 Cong. Rec. 38857 (1971).
A comparison of section 21(b) and section 401 reveals that the two
sections are, indeed, substantially the same. Congress's revisions to
section 401(a) in the 1977 CWA amendments also suggests continued
support for certifying authority consideration of water quality impacts
not limited to point sources. In 1977, Congress added section 303 to
the various lists of CWA sections in section 401. Legislative history
from 1977 states that Congress intended for ``[t]he inserting of
section 303 into the series of sections listed in section 401 [ ] to
mean that a federally licensed or permitted activity, including
discharge permits under section 402, must be certified to comply with
State water quality standards adopted under section 303.'' H.R. Rep.
No. 95-830, at 96 (1977). As discussed above, section 303 requires
states to adopt water quality standards for its waters and applies to
waters regardless of the presence of point or nonpoint sources of
pollution or pollutants.
The legislative history also indicates that Congress intended the
phrase ``any other appropriate requirement of state law'' to be read
broadly. In earlier pre-adoption versions of section 401(d), Congress
proposed to limit section 401(d) to the enumerated provisions from
section 401(a)(1) and either ``any more stringent water quality
requirements under State law provided in section 510 of [the Act],'' S.
2770, 92nd Cong. (1972), or ``any regulation under section 316 of this
Act.'' H.R. 11896, 92nd Cong. (1972). Ultimately, Congress did not
adopt either of those formulations. Instead, consistent with Congress's
objective to empower states to protect their waters from pollution,
Congress ``expanded'' beyond these earlier proposals the scope of
section 401(d) ``to also require compliance with any other appropriate
requirement of State law which is set forth in the certification.'' S.
Rep. No. 92-1236, at 138 (1972) (Conf. Rep.).
[[Page 66604]]
A definition of ``water quality requirements'' that is not limited
to point sources also is consistent with the underlying purposes of the
CWA. Congress provided states and authorized Tribes with the primary
role in protecting the nation's waters from pollution, including
pollution from federally licensed or permitted projects, and the phrase
``water quality requirements'' should be interpreted broadly to
preserve state and Tribal authority and further the water quality
protective goal of section 401. See S.D. Warren, 547 U.S. at 386
(``State certifications under [section] 401 are essential in the scheme
to preserve state authority to address the broad range of pollution . .
.''); see also S. Rep. 91-414, at 1487 (1971) (``The purpose of the
certification mechanism provided in this law is to assure that Federal
licensing or permitting agencies cannot override State water quality
requirements.'').
Finally, prior judicial interpretation also supports EPA's
definition of ``water quality requirements'' as finalized here. EPA
recognizes that, as noted by the Supreme Court in PUD No. 1, the
authority granted to certifying authorities in section 401(d) ``is not
unbounded.'' 511 U.S. at 712. Rather, the scope is limited to
``ensur[ing] that the project complies with `any applicable effluent
limitations or other limitations under [33 U.S.C. 1311, 1312] or other
provisions of the Act,['] `and with any other appropriate requirement
of State law.' '' Id. Although the Court declined ``to speculate on
what additional state laws, if any, might be incorporated by this
language,'' the Court found that ``at a minimum, limitations imposed
pursuant to state water quality standards adopted pursuant to [section]
303 are `appropriate' requirements of state law.'' Id. at 713. As
described earlier in this section, EPA's longstanding position is that
the scope of certification decisions and conditions are limited to
water quality-related considerations. EPA's definition of the term
``water quality requirements'' in the final rule is not intended to
alter this interpretation.
EPA is not offering an opinion in this rulemaking about what
constitutes a ``State law'' as that term is used in section 401(d). In
the spirit of cooperative federalism, EPA defers to the relevant state
and Tribe to define which of their state or Tribal provisions qualify
as appropriate ``State law'' or Tribal law for purposes of implementing
section 401.
d. Waters Considered in Acting on a Request for Certification
The Agency also is finalizing an interpretation regarding which
waters a certifying authority considers when acting on a request for
certification, with an important clarification in response to
commenters. At proposal, EPA advanced an approach where a certifying
authority would consider water quality-related impacts to waters within
its jurisdiction beyond ``navigable waters'' as defined by the CWA (at
33 U.S.C. 1362). See 87 FR 35348 (``EPA does not believe that the scope
of a state's or tribe's certification review is limited only to water
quality effects in bodies of water meeting the definition of `navigable
waters' or `waters of the United States' . . .''). Some commenters
expressed concern with allowing certifying authorities to use the
certification process to impose conditions relating to waters that are
not ``waters of the United States'' and disagreed with the Agency's
proposed position that section 401 could extend to non-``navigable
waters'' once the threshold discharge into waters of the United States
is met. A few commenters also noted that states could regulate state
waters under their own laws.
The Agency concludes that while a certifying authority is limited
to considering impacts to ``navigable waters'' when certifying
compliance with the enumerated provisions of the CWA, a certifying
authority is not so limited when certifying compliance with
requirements of state or Tribal law that otherwise apply to waters of
the state or Tribe beyond navigable waters. As discussed below, this
interpretation best reflects the text of section 401. EPA recognizes
that some states regulate waters beyond CWA ``navigable waters,'' while
other states do not. EPA's interpretation best supports principles of
cooperative federalism by allowing those states that do have laws
applicable beyond ``navigable waters'' to apply those laws to those
state waters in the certification context, and by not requiring other
states to do so. An examination of the interpretation asserted in the
2020 Rule and the interpretation offered at proposal reveals that the
interpretation as clarified in this final rule is the most consistent
with the statute and best balances the cooperative federalism framework
of section 401--by not applying provisions of the CWA to state waters
that Congress otherwise limited to Federal waters, while still
authorizing states and Tribes to protect those state or Tribal waters
from federally licensed or permitted projects.\69\ It also realigns
with the Agency's position prior to the 2020 Rule. 2010 Handbook at 5
(``Note, however, that once Sec. 401 has been triggered due to a
potential discharge into a water of the U.S., additional waters may
become a consideration in the certification decision if it is an
aquatic resource addressed by ``other appropriate provisions of state [
] law.'') (rescinded in 2019, see supra).
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\69\ The Agency notes that this final interpretation is not
reflected in the final regulatory text, including at Sec. 121.3
regarding the scope of certification. The issue of what aspects of
the activity are considered is distinct from the issue of what
waters are considered.
---------------------------------------------------------------------------
When a certifying authority considers whether an activity will
comply with CWA sections 301, 302, 303, 306, and 307, the certifying
authority is limited to considering impacts to ``navigable waters.'' 33
U.S.C. 1341(a)(1). These sections of the CWA apply only to navigable
waters as defined by the CWA. Id. at 1362(7). EPA concludes that the
best interpretation of section 401 is that it does not allow a
certifying authority to apply these CWA provisions beyond the waters
that Congress intended for them to apply. However, a certifying
authority must also consider whether the activity will comply with
``any other appropriate requirement of State law.'' Id. at 1341(d). EPA
concludes that other appropriate requirements of state or Tribal law
include requirements that apply to state or Tribal waters beyond those
waters covered by CWA section 402 and 404 permits. EPA further
concludes that certifying authorities may consider the application of
these laws to all waters impacted by the activity to which these laws
otherwise apply.
In contrast to the section 402 and section 404 permit programs
established in the 1972 version of the Act, the Act does not directly
address what waters are considered for section 401. Section 402 and
section 404 permits unambiguously cover impacts of discharges to
navigable waters.\70\
[[Page 66605]]
Conversely, while the text of section 401 states that the need for a
certification is triggered by a potential discharge into ``the
navigable waters,'' it does not state that, once the need for
certification is triggered, a certifying authority must confine its
review to potential water quality impacts to such ``navigable waters''
even when considering requirements of state law that apply beyond
navigable waters. 33 U.S.C. 1341(a)(1). Instead, in enacting section
401(d), Congress required a certifying authority to consider whether
the ``applicant'' will comply with ``any other appropriate requirement
of State law.'' Id. When Congress enacted section 401(d), it explained
that this provision ``assure[d] that Federal licensing or permitting
agencies cannot override State water quality requirements.'' S. Rep.
No. 92-414, at 69 (1971).
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\70\ One way Congress expressly limited the application of
section 402 permits to discharges to navigable waters is through the
definition of ``discharge of a pollutant,'' a term that is not used
in section 401. Section 402 authorizes EPA to issue permits ``for
the discharge of any pollutant,'' 33 U.S.C. 1342(a)(1), which is
defined as ``any addition of any pollutant to navigable waters from
any point source.'' Id. at 1362(12) (emphasis added). EPA may issue
such a permit upon the condition that the discharge will meet the
requirements of sections 301, 302, 306, 307, and 308, Id. at
1342(a)(1), all sections of the CWA that do not apply beyond
navigable waters. Section 402 also authorizes states to apply for
their ``own permit program for discharges into navigable waters
within its jurisdiction.'' Id. at 1342(b) (emphasis added). Section
404 authorizes the Corps to issue permits ``for the discharge of
dredged or fill material into the navigable waters'' and authorizes
any state to apply for their own ``permit program for the discharge
of dredged or fill material into the navigable waters.'' Id. at 1344
(emphasis added).
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State laws governing state water quality can of course apply to
waters other than those directly regulated under the CWA. See 87 FR
35348 (recognizing at proposal that ``states may, under state law,
protect state waters beyond those that are'' covered by CWA
permitting). About half of the states have state laws covering at least
some surface waters beyond CWA navigable waters. EPA and Department of
Army, Economic Analysis for the Final ``Revised Definition of `Waters
of the United States' '' Rule, section II.A (December 2022). When
Congress required states to consider state laws when acting on a
request for certification, Congress declined to expressly limit this
authorization to state laws that apply to waters regulated under the
CWA. While Congress did include the limiting principle of
``appropriate,'' the text and legislative history of section 401 do not
suggest that Congress considered state laws that apply to waters beyond
those directly regulated under the CWA to be ``inappropriate'' state
laws. Nor does the text and legislative history of section 401 suggest
that Congress intended to limit the applicability of such laws to only
a subset of waters to which they normally apply (namely, ``navigable
waters''). Had Congress desired to prohibit states from considering
water quality impacts to state waters, it could easily have done so. It
did not.
This interpretation is reinforced by the fact that Congress
intended section 401 to afford states and authorized Tribes broad power
to protect their waters from harm caused by federally licensed or
permitted projects. That intent is best realized by interpreting
section 401 as allowing states and authorized Tribes to apply state law
or Tribal law to all impacted state or Tribal waters when acting on a
request for certification. While the section 401 certification
requirement is triggered by a potential discharge into ``navigable
waters,'' water quality impacts from the activity could occur in state
or Tribal waters beyond those navigable waters. Allowing states or
authorized Tribes to apply state or Tribal law to all potentially
affected state or Tribal waters is supported by CWA section 510,
which--``[e]xcept as expressly provided'' in the CWA--preserves a
state's or authorized Tribe's authority and jurisdiction to protect its
waters from pollution.
The best reading of section 401 is that it authorizes a state or
Tribe to apply state law or Tribal law to all impacted state or Tribal
waters, rather than limiting states and Tribes to considering only a
subset of impacted waters. EPA acknowledges it articulated a different
position on those issues in the 2020 Rule. 85 FR 42234-35. Upon
reconsideration, EPA believes there are good reasons for changing its
position now. EPA disagrees with and finds unpersuasive the 2020 Rule
preamble's attempt to conflate section 401 with sections 402 and 404 by
saying that ``similar to the section 402 and 404 permit programs,
section 401 is a core regulatory provision of the CWA.'' Id. While
section 401 is certainly a critical element of the Act--indeed, it pre-
dated the 1972 CWA amendments and was deemed so important that Congress
carried it over--section 401 is a direct congressional grant of
authority for states and authorized Tribes to protect their water
resources from impacts caused by federally licensed or permitted
projects, and is significantly different in character from the Act's
other Federal ``regulatory'' provisions. Section 401, although a
neighbor to sections 402 and 404 in the CWA's organizational framework,
is a fundamentally different provision and need not be interpreted
according to those other provisions' strictures. The preamble to the
2020 Rule, with little supporting analysis, asserted incorrectly that
any application of section 401 to non-Federal waters ``would
effectively broaden the scope of the Federal regulatory programs
enacted by the 1972 CWA amendments [e.g., sections 402 and 404] beyond
the limits that Congress intended.'' 85 FR 42234-35. However, the
interpretation taken in this final rule in no way broadens the scope of
sections 402 and 404. Finally, the reasons articulated above in support
of a broad scope of certification (e.g., Congress intended for section
401 to be a powerful tool for states to protect state waters from
federally licensed or permitted projects) also support a state or
authorized Tribe applying state or Tribal law to protect state or
Tribal waters when acting on a request for certification.
e. Scope of Conditions
The Agency is adding text at Sec. 121.3(b) to clarify that the
scope of review for a certification decision is the same as the scope
of permissible conditions that may be added to that certification. This
is consistent with the proposed rule, which would have required a grant
of certification with conditions to include ``[a]ny conditions
necessary to assure that the activity as a whole will comply with water
quality requirements,'' 87 FR 35378--the same standard as the proposed
scope of review for a certification decision. Moreover, the preamble to
the proposed rule was clear that EPA ``interpret[ed] the scope of
certification review under sections 401(a)(1) and (d) to be the same. .
. .'' 87 FR 35346. To clearly convey the Agency's intent, EPA is adding
regulatory text at Sec. 121.3(b) stating that ``consistent with the
scope of review identified in paragraph (a) of this section, a
certifying authority shall include any conditions in a grant of
certification necessary to assure that the activity will comply with
applicable water quality requirements.''
Because the scope of review applies when the certifying authority
is determining whether to grant certification, the same ``activity''
standard should apply to a grant of certification, a grant of
certification with conditions, and a denial of certification. That is,
the outcome of the certifying authority's analysis should not dictate
the scope of review. Logically, the same scope applies to a certifying
authority's evaluation of potential water quality effects under both
sections 401(a)(1) and 401(d). This is because the two sections are
inextricably linked. Section 401(d) requires a certifying authority to
determine whether ``the applicant'' will--without additional
conditions--comply with the same CWA provisions identified in section
401(a)(1) and ``any other appropriate'' requirement of state or Tribal
law. Only if the certifying authority determines pursuant to section
401(d) that adding ``any effluent limitations and other limitations,
and monitoring requirements'' to the Federal license or permit will
assure that water
[[Page 66606]]
quality requirements will be met, may the certifying authority grant
the certification contemplated by section 401(a)(1). In other words,
when a certifying authority determines that it must add conditions
under section 401(d) to the certification, that is equivalent to
deciding that, without those conditions, it must deny certification.
The certifying authority's evaluations and determinations under
sections 401(a)(1) and 401(d) do not work together in a harmonious
fashion if the statute is interpreted to apply a different scope of
review to each section. EPA has never taken the opposite position. In
the 2020 Rule, EPA also concluded that the scope of sections 401(a)(1)
and (d) should be the same. 85 FR 42252.\71\
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\71\ See also 2010 Handbook at 18 (rescinded in 2019, see supra)
(``In order to obtain certification of any proposed activity that
may result in a discharge to waters of the U.S., an applicant must
demonstrate that the proposed activity and discharge will not
violate or interfere with the attainment of any limitations or
standards identified in [section] 401(a) and (d).'')
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3. Implementation
At proposal, the Agency identified examples of certification
conditions possibly falling inside and outside of the water quality-
related scope of section 401 review. Some commenters provided input on
these examples. Some of those commenters explicitly supported the
listed examples, whereas other commenters disagreed that the examples
listed were appropriately within the scope of certification. A few
commenters argued that the scope of certification should be limited to
protection of water quality sufficient to support designated uses, as
opposed to direct protection of those uses, and argued that some
examples in the proposal constituted the latter. A few commenters
focused specifically on the examples regarding public fishing access
and recreation facilities, arguing that they are not linked to
preserving the water quality necessary for the designated use and
should not be in the scope of a certifying authority's review. A few
other commenters asserted that EPA was equating ensuring people can
enjoy the benefits of water quality with actually ensuring water
quality and argued that certifications should not include impacts that
are not directly related to improving or maintaining water quality.
Some commenters provided their own examples of conditions they
considered to be related or unrelated to water quality and asked for
EPA to explicitly state which conditions would be within or outside the
scope of section 401 certification.
The Agency declines to explicitly identify which conditions would
be within or outside the scope of section 401 certification because,
subject to a case-by-case review of the particular facts presented by
each certification, a wide variety of conditions could be appropriate
as necessary to prevent adverse impacts to a state's or Tribe's water
quality. The appropriateness of any given condition will depend on an
analysis of all relevant facts, including the certifying authority's
applicable water quality requirements. For potentially qualifying
conditions, it is appropriate for the certifying authority to consider
all potential adverse water quality impacts.
To be clear, a certifying authority could condition an activity to
ensure its compliance with any and all components of applicable water
quality standards (water quality criteria, designated uses, and
antidegradation requirements). Therefore, certifying authorities could
include conditions to ensure a project will comply with, in addition to
water quality criteria, a designated use of a water, see PUD No. 1, 511
U.S. at 714-15 (emphasis in original) (``We think the language of
[section] 303 is most naturally read to require that a project be
consistent with both components, namely the designated use and the
water quality criteria. Accordingly, under the literal terms of the
statute, a project that does not comply with a designated use of the
water does not comply with the applicable water quality standards.''),
or antidegradation requirements, see id. at 718-19 (recognizing the
state appropriately justified its minimum flow rate as necessary to
implement its antidegradation policy). This means conditions, such as
those to ensure compliance with minimum flow rates to protect fisheries
(see, e.g., PUD No. 1, 511 U.S. 700); and scheduled releases to
accommodate existing recreational uses (see, e.g., In re Morrisville
Hydroelectric Project Water Quality, 2019 VT 84, 224 A.3d 473 (2019)),
may be appropriate certification conditions depending on the certifying
authority's water quality standards or other aspects of state or Tribal
law and the activity's impact on achieving compliance with such
requirements.
The preamble to the final 2020 Rule identified examples of
certification conditions possibly falling outside the water quality-
related scope of section 401 review because they did not address water
quality impacts, including conditions requiring one-time and recurring
payments to state agencies for improvements or enhancements that are
unrelated to the proposed federally licensed or permitted project;
conditions to address potential non-water quality-related environmental
impacts from the creation, manufacture, or subsequent use of products
generated by a proposed federally licensed or permitted activity; and
conditions related only to non-water quality-related impacts associated
with air emissions and transportation effects. See 85 FR 42230. Subject
to a case-by-case review of the particular facts presented by each
certification, it is reasonable to assume that such non-water quality-
related conditions would generally be beyond the scope of section 401.
Several commenters asserted that the proposed activity-based scope
of certification was too ambiguous and would lead to various
implementation challenges, such as regulatory uncertainty, increased
litigation risk, increased project costs, and project delays. As
discussed above, the Agency disagrees that its approach in the final
rule will lead to implementation challenges. Rather, the final rule's
approach to the scope of certification simply returns to the
longstanding practice. Ultimately, the ``activity'' subject to the
Federal license or permit will depend on the specific facts of a given
situation. For example, the activity may be the construction and
operation of a hydroelectric dam, see, e.g., PUD No. 1, 511 U.S. at
708-09, the construction and operation of a liquified natural gas
marine import terminal and a pipeline connecting the terminal to an
interstate natural gas pipeline, see, e.g., AES Sparrows, 589 F.3d at
723-24, or the construction and operation of a marina, see, e.g., Winer
Memorandum at 1.
While the specific ``activity'' subject to certification will be
fact specific, the final rule clarifies certain limiting principles
that apply to all certifications. A certifying authority's analysis is
limited to evaluating the adverse water quality-related impacts from
the activity when it evaluates whether the activity will comply with
applicable water quality requirements. As discussed above, both the
terms ``will comply'' and ``applicable water quality requirements''
limit what a certifying authority may consider and ultimately, the
decisions that a certifying authority can make on a given request for
certification.
F. Certification Decisions
1. What is the Agency finalizing?
In Sec. 121.7(a), the Agency is finalizing that ``a certifying
authority may act on a request for certification in one of four ways:
grant certification, grant
[[Page 66607]]
certification with conditions, deny certification, or expressly waive
certification.'' To provide further clarity on how a certifying
authority may ``act on a request for certification,'' EPA is defining
recommended minimum contents of a certification decision at Sec.
121.7(c) through (f) and finalizing that certification decisions must
be in writing. In a change from proposal and in support of the
cooperative federalism balance central to section 401, the Agency is
not requiring certifying authorities to include the components listed
at Sec. 121.7(c) through (f) in their certification decisions.
Instead, the final rule defines recommended contents for a grant of
certification (Sec. 121.7(c)), a grant of certification with
conditions (Sec. 121.7(d)), a denial of certification (Sec.
121.7(e)), and an express waiver (Sec. 121.7(f)).
2. Summary of Final Rule Rationale and Public Comment
a. Decisions on a Request for Certification
Consistent with the CWA, EPA is finalizing the proposed approach
that a certifying authority must make one of four decisions on a
request for certification pursuant to its section 401 authority: it may
grant certification, grant certification with conditions, deny
certification, or it may expressly waive certification. 40 CFR
121.7(a). This section briefly describes each of the four decisions a
certifying authority may make, including what each decision means and
its impact on the Federal licensing or permitting process. This final
rule's interpretation of the four decisions a certifying authority may
make is consistent with the 2020 Rule and longstanding interpretation
of the 1971 Rule. See 40 CFR 121.7 (2020); 2010 Handbook at 1
(rescinded in 2019, see supra) (``The central feature of CWA Sec. 401
is the state or tribe's ability to grant, grant with conditions, deny
or waive certification.'').
First, a certifying authority may grant certification. A grant of
certification means that the certifying authority has determined that
the activity will comply with water quality requirements. See section
IV.E in this preamble for further discussion of the scope of
certification and the term ``water quality requirements.'' Granting
certification means that the Federal license or permit may be issued.
See 33 U.S.C. 1341(a)(1). Section 401(a)(1) provides that where there
are no applicable water quality requirements for an activity, the
certifying authority ``shall so certify.'' Id. EPA is finalizing minor
revisions to the regulatory language located at Sec. 121.7(f) of the
2020 Rule that describes this scenario, with minor edits to reflect the
final rule scope of certification. See 40 CFR 121.7(g).
Second, a certifying authority may grant certification with
conditions. A grant of certification with conditions means that the
certifying authority has determined that the activity will comply with
water quality requirements, but only if certain conditions are met.
Pursuant to section 401(d), if a grant of certification includes
conditions, those conditions must be incorporated into the Federal
license or permit. 33 U.S.C. 1341(d) (``Any certification provided
under this section shall set forth any effluent limitations and other
limitations, and monitoring requirements necessary to assure that any
applicant for a Federal license or permit will comply with [sections
301, 302, 306, and 307], and with any other appropriate requirement of
State law set forth in such certification, and shall become a condition
on any Federal license or permit . . .'') (emphasis added). As
discussed later in section IV.G in this preamble, Federal circuit
courts have routinely held that Federal agencies may not question or
reject a state's certification conditions. See, e.g., American Rivers,
129 F.3d at 107 (``[Section 401(d)] is unequivocal, leaving little room
for FERC to argue that it has authority to reject state conditions it
finds to be ultra vires.''). Granting certification with conditions
means the Federal license or permit may be issued, provided the
conditions are incorporated into that Federal license or permit.
In this final rule, the Agency is not retaining any regulatory text
on the incorporation of certification conditions as was included in the
2020 Rule. See 40 CFR 121.10 (2020). First, the 2020 Rule limited
incorporation of certification conditions to only those that satisfy
the content requirements at Sec. 121.7(d) of the 2020 Rule.\72\ 40 CFR
121.10 (2020). Section 401(d) requires all certification conditions to
become conditions on a Federal license or permit and does not limit
incorporation to only those conditions that include certain
regulatorily defined components. As discussed in section IV.G of this
preamble, EPA does not interpret the statute as allowing a Federal
agency to review whether a certifying authority included certain
regulatorily defined elements in its certification decisions, nor
reject certifying authority conditions. Second, while the 2020 Rule
required Federal agencies to clearly identify certification conditions
in their Federal license or permit, section 401 does not require
Federal agencies to distinguish among certification conditions in their
licenses or permits. If the Federal agency finds it useful to
distinguish certification conditions for implementation purposes, the
Federal agency may structure its license or permit in such a manner,
but EPA does not find it necessary to require such a distinction.
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\72\ For example, the 2020 Rule required certifying authorities
to include a statement explaining why the condition is necessary to
assure that the discharge from the proposed project will comply with
water quality requirements and a citation to Federal, state, or
Tribal law that authorizes the condition for each certification
condition on an individual license or permit. 40 CFR 121.7(d)(1)
(2020).
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Third, a certifying authority may deny certification. A denial of
certification means that the certifying authority is not able to
certify that the activity will comply with water quality requirements.
If a certifying authority denies certification, the Federal license or
permit cannot be issued. 33 U.S.C. 1341(a)(1). The 2020 Rule included
regulatory text that discussed the effects of a denial of
certification. See 40 CFR 121.8 (2020). Section 121.8(a) of the 2020
Rule provided that a certification denial would not preclude a project
proponent from submitting a new certification request. Section 121.8(b)
provided that if the Federal agency determined that the certifying
authority's denial satisfied the content requirements at Sec. 121.7(e)
of the 2020 Rule,\73\ then the Federal agency would provide notice to
the certifying authority and project proponent and the Federal license
or permit would not be granted. As discussed below, the Agency is not
retaining any regulatory text that speaks to the effects of a denial of
certification because it is unnecessary.
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\73\ For example, the 2020 Rule required certifying authorities
to include three components on all denials of certification for
individual Federal licenses or permits, including the specific water
quality requirements with which the discharge will not comply, a
statement explaining why the discharge will not comply with the
identified water quality requirements, and description of the
specific water quality data or information, if any, that would be
needed to assure that the discharge from the proposed project will
comply with water quality requirements if the denial was due to
insufficient information. 40 CFR 121.7(e)(1) (2020).
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A few commenters discussed whether the proposal would prevent a
project proponent from resubmitting a request for certification
following a denial. One commenter noted that while the 2020 Rule
provided that a certification denial would not preclude a project
proponent from submitting a new certification request, the proposal did
not include a similar provision. The commenter
[[Page 66608]]
suggested that EPA is taking the position that a certification denial
is always a permanent final action that is taken with prejudice and
asserted that if this is EPA's position, it would be a significant
change from its previous longstanding position affirmed by the 2020
Rule.
EPA's removal of regulatory text regarding the effects of a denial
of certification has no impact on denials without prejudice. EPA
continues to interpret section 401 as allowing denials without
prejudice.\74\ Section 401(a)(1) provides that a Federal license or
permit may not be granted if certification is denied, but it does not
speak to new requests for certification following a denial of
certification. Nothing in section 401, nor this final rule, prohibits a
project proponent from re-applying for certification if a certifying
authority denies its initial request.
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\74\ See e.g., New York State Dep't of Env't Conservation v.
FERC, 991 F.3d 439, 450 at n.11 (2d Cir. 2021) (noting that if a
state finds that a ``particular application requires
supplementation,'' the state ``can deny an application without
prejudice within the one-year deadline, which will presumably prompt
the applicant to resubmit the application with additional
material'') (citing New York State Dep't of Env't Conservation v.
FERC, 884 F.3d 450, 456 (2d Cir. 2018)); Turlock Irrigation Dist. v.
FERC, 36 F.4th 1179, 1183-84 (D.C. Cir. 2022) (rejecting arguments
that, if the court upheld the denials without prejudice at issue
before it, ``State agencies could extend the time for decision
indefinitely by denying one certification request after another
without prejudice, thus nullifying section 401's one-year limit'').
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EPA does not find it necessary to add any additional direction or
process for certification denials, beyond providing recommended
contents of a certification denial (as discussed below). If a project
proponent disagrees with a certifying authority's denial, the project
proponent may challenge the certifying authority's decision in the
appropriate court. See S. Rep. 92-414 at 69 (1971) (``Should such an
affirmative denial occur no license or permit could be issued by such
Federal agencies . . . unless the State action was overturned in the
appropriate courts of jurisdiction.''). The 2020 Rule also provided
that a Federal license or permit may not be issued if a certifying
authority denies certification in the manner prescribed by the 2020
Rule (i.e., contains the contents defined at Sec. 121.7(e) of the 2020
Rule). Under this final rule, Federal agencies may not review whether a
certifying authority's certification denial contains the contents
recommended at final rule Sec. 121.7(e).
Fourth, a certifying authority may expressly waive certification.
The statute explicitly provides for a constructive waiver if the
certifying authority fails or refuses to act on a request for
certification within the reasonable period of time. The statute does
not explicitly state that a certifying authority may expressly waive
certification. A few commenters suggested that the final rule should
remove the term ``expressly'' from the waiver provisions because the
CWA does not provide any circumstances in which certification can be
waived before the reasonable period of time expires, and EPA does not
have the authority to add provisions in which a certifying authority
can expressly waive certification. However, EPA has determined that
providing this opportunity in this final rule is consistent with a
certifying authority's ability to waive through failure or refusal to
act. See EDF v. Alexander, 501 F. Supp. 742, 771 (N.D. Miss. 1980)
(``We do not interpret [the Act] to mean that affirmative waivers are
not allowed. Such a construction would be illogical and inconsistent
with the purpose of this legislation.''). This interpretation is also
consistent with the Agency's longstanding interpretation of the waiver
provision. See 40 CFR 121.9(a)(1) (2020) (allowing a certifying
authority to expressly waive certification via written notification);
40 CFR 121.16(a) (2019) (same). Additionally, continuing to allow
express waivers may create efficiencies where the certifying authority
knows early in the process that it will waive. An express waiver does
not mean that the certifying authority has determined that the activity
will comply with water quality requirements. Instead, an express waiver
indicates only that the certifying authority has chosen not to act on a
request for certification. Consistent with the statutory text, an
express waiver enables the Federal agency to issue a Federal license or
permit without a certification. 33 U.S.C. 1341(a)(1).
b. Defining What It Means ``To Act on a Request for Certification''
The Agency is finalizing the definition of what it means ``to act
on a request for certification'' as proposed at Sec. 121.7(a). Once a
certifying authority receives a request, the certifying authority must
``act on a request for certification, within a reasonable period of
time (which shall not exceed one year) after receipt of such request.''
33 U.S.C. 1341(a)(1). The phrase ``to act on a request for
certification'' is not defined in the statute; nor did EPA define it in
the 1971 or 2020 Rules. To provide greater clarity regarding how a
certifying authority ``act[s] on a request for certification'' within
the reasonable period of time, EPA is defining the phrase to mean that
a certifying authority is making one of the four certification
decisions discussed above: granting certification, granting
certification with conditions, denying certification, or expressly
waiving certification.
The Agency is providing clarification regarding what it means to
``act on a request for certification'' in light of commenter input on
this topic and recent case law. For example, would other actions beyond
the four just discussed qualify as ``acting'' on a request for
certification? The Fourth Circuit recently held that it was permissible
for a project proponent to withdraw its application to avoid a
certification denial as long as the certifying authority and project
proponent were not in a ``coordinated withdrawal and resubmission
scheme.'' NCDEQ v. FERC, 3 F.4th 655, 672, 676 (4th Cir. 2021).
However, the court, in dicta, also suggested that the section 401
phrase ``to act'' could be interpreted to mean something different than
a final action on a request for certification. According to the court,
a certifying authority that ``takes significant and meaningful action''
and ``in good faith takes timely action to review and process a
certification request likely would not lose its authority to ensure
that federally licensed projects comply with the State's water quality
standards, even if it takes the State longer than a year to make its
final certification decision.'' Id. at 670.
EPA proposed to interpret the phrase ``to act on a request for
certification'' to mean that a certifying authority makes one of the
four above-described certification decisions: grant, grant with
conditions, deny, or expressly waive. However, the Agency requested
comment on this interpretation, as well as any alternative
interpretations, such as the NCDEQ approach. A few commenters did not
support the proposed approach and stated that defining ``act'' as
``decide'' violates the presumption that Congress could have included
language that it did not. One commenter stated that Congress
deliberately used the language ``fails or refuses to act'' instead of
``grant or deny'' when crafting the statutory text of section 401. A
few other commenters stated that a certifying authority acting in
``good faith'' to make a final decision on a certification request
should not be deemed a failure to act even if that decision takes
longer than one year. Conversely, some commenters supported the
proposed approach noting it provided much needed clarity and correctly
rejected the NCDEQ approach.
[[Page 66609]]
The Agency finds that defining ``to act on a request for
certification'' as making one of the four above-described certification
decisions is reasonable, consistent with congressional intent, is
consistent with longstanding Agency position and case law, and allows
for greater certainty and transparency in the certification process.
First, while Congress did not use the words ``grant or deny'' or
``decide'' in place of ``act on a request for certification,'' in
context it seems evident that these are the actions Congress had in
mind. After all, section 401(a)(1) is about the effects of granting or
denying certification. Moreover, while Congress did not use the words
``grant or deny,'' it likewise did not use a term that clearly
indicated that Congress had in mind something short of a final
``action'' on a request for certification. Congress clearly intended to
balance state water quality concerns with the need to guard against
unreasonable delays in the Federal licensing or permitting process.
See, e.g., 115 Cong. Rec. 9257, 9264 (April 16, 1969) (``The failure by
the State to act in one way or the other within the prescribed time
would constitute a waiver of the certification required as to that
State.''); H.R. Rep. No. 91-940, at 54-55 (March 24, 1970) (Conf. Rep.)
(``In order to insure that sheer inactivity by the State . . . will not
frustrate the Federal application, a requirement, similar to that
contained in the House bill is contained in the conference substitute
that if within a reasonable period, which cannot exceed one year, after
it has received a request to certify, the State . . . fails or refuses
to act on the request for certification, then the certification
requirement is waived.''). If a certifying authority could merely act
in a ``significant and meaningful'' way to avoid waiver at the
expiration of the reasonable period of time, it could delay the Federal
licensing or permitting process well beyond the statutory one-year
timeframe and have the same practical effect as denying certification
without going on the record to do so. While Congress provided states
and Tribes with a powerful tool to prevent federally licensed or
permitted activities that will not comply with water quality
requirements, Congress clearly intended states and Tribes to take an
affirmative action to prevent such activities. 33 U.S.C. 1341(a)(1)
(``No license or permit shall be granted if certification has been
denied . . .'') (emphasis added). The Agency finds that defining ``to
act'' as taking one of the four decisions contemplated in section 401
best effectuates congressional intent and respects the cooperative
federalism balance central to section 401.
Further, although the Agency has never explicitly defined ``to act
on a request for certification,'' the interpretation taken in this
final rule is consistent with prior Agency guidance and the 2020 Rule
preamble. In the 2020 Rule, the Agency noted that ``[i]f a certifying
authority fails or refuses to [grant certification, grant certification
with conditions, deny certification, or expressly waive certification]
within the reasonable period of time, the CWA provides that the
certifying authority will be deemed to have waived the certification
requirement.'' 85 FR 42262 (July 13, 2020). One implication of this
language is that the Agency thought that ``to act on a request for
certification'' means to make a final decision on the request (i.e.,
grant, grant with conditions, deny, or expressly waive certification).
Courts appear to agree. See, e.g., Alcoa Power Generating, Inc. v.
FERC, 643 F.3d 963, 972 (D.C. Cir. 2011) (noting that ``[i]n imposing a
one-year time limit on States to `act,' Congress plainly intended to
limit the amount of time that a State could delay a federal licensing
proceeding without making a decision on the certification request'');
NYSDEC, 884 F.3d at 455-56 (noting that a state must act after
receiving a certification request and that denial ``would constitute
`acting' on the request under the language of Section 401''); New York
State Dep't of Environmental Cons. v. FERC, 991 F.3d 439, 443, 450 (2d
Cir. 2021) (State agency could not ``extend[ ] the deadline . . . to
issue or deny water quality certification'' beyond ``one year of the
actual receipt of the application'' for certification); Millennium
Pipeline Co. v. Seggos, 860 F.3d 696, (D.C. Cir. 2017) (``To prevent
state agencies from indefinitely delaying issuance of a federal permit,
. . . . a State [must] grant or deny the certificate'' within one year
from the receipt of a request for certification).
Lastly, the Agency finds that the final rule's approach best
supports a clear, consistent, and transparent certification process. As
noted at proposal, EPA shared similar concerns as stakeholders with the
NCDEQ approach, noting that it may make the section 401 certification
process less predictable and transparent. 87 FR 35350 (June 9, 2022).
The Agency remains concerned that interpreting ``to act on a request
for certification'' as any ``significant and meaningful action'' might
inject significant uncertainty and subjectivity into the certification
process (e.g., what is a ``significant and meaningful action?'')
causing significant confusion for stakeholders. Id. EPA finds that the
final rule approach will provide stakeholders with a clear and
predictable endpoint for knowing when the certifying authority has
failed or refused to act, resulting in a waiver. See 33 U.S.C.
1341(a)(1).
c. Failing or Refusing To Act on a Request for Certification
Similar to the proposed rule, the Agency is finalizing at Sec.
121.9(a) that ``the certification requirement shall be waived only if a
certifying authority fails or refuses to act on a request for
certification within the reasonable period of time.'' 40 CFR 121.9(a).
EPA proposed at Sec. 121.8 that ``the certification requirement shall
be waived if a certifying authority fails or refuses to act on a
request for certification in accordance with Sec. 121.7(a) within the
reasonable period of time, as defined at Sec. 121.6.'' EPA has
reorganized the regulatory text by moving the text proposed at Sec.
121.8 (``Failure or refusal to act'') to Sec. 121.9 and made several
revisions. First, EPA made minor non-substantive revisions at Sec.
121.9(a) to remove unnecessary and redundant internal references to
Sec. Sec. 121.6 (reasonable period of time) and 121.7(a) (possible
actions on a request for certification). Second, the Agency has moved
proposed Sec. 121.9(c), which described the process that occurred once
a certifying authority failed or refused to act, to Sec. 121.9(b) to
pair the process that occurs once a certifying authority fails or
refuses to act with the final rule's express statement on constructive
waiver. The Agency intends such restructuring to clearly convey that a
constructive waiver of certification may only occur where a certifying
authority fails or refuses to act, as defined in this final rule,
within the reasonable period of time. See section IV.G in this preamble
for further discussion on Federal agency review for failure or refusal
to act within the reasonable period of time.
The plain language of section 401(a)(1) provides that the
certification requirement is waived if a certifying authority ``fails
or refuses to act on a request for certification, within a reasonable
period of time (which shall not exceed one year).'' Id. As discussed in
section IV.D of this preamble, a certifying authority and Federal
agency may jointly agree to set the reasonable period of time up to one
year. 40 CFR 121.6(b). However, if they are unable to reach agreement,
it will default to six months. 40 CFR 121.6(c). Accordingly, if the
certifying authority fails or refuses to act in the agreed-upon or
default reasonable period of time, the certifying authority will
constructively waive.
[[Page 66610]]
Section 401(a)(1) clearly indicates Congress's intent to limit
constructive waivers to situations where a certifying authority did not
act within the reasonable period of time. See id. (``No license or
permit shall be granted until the certification required by this
section has been obtained or has been waived as provided in the
preceding sentence.'').
The legislative history of this provision also suggests that
constructive waivers were intended to prevent delays in the Federal
licensing or permitting process due to the certifying authority's
failure to grant or deny certification. See H. Rep. No 92-911, at 122
(1972) (``In order to insure that sheer inactivity by the State,
interstate agency or Administrator as the case may be, will not
frustrate the Federal application, a requirement, that if within a
reasonable period, which cannot exceed 1 year, after it has received a
request to certify the State, interstate agency, or Administrator, as
the case may be, fails or refuses to act on the request for
certification, then the certification requirement is waived.'').
Similarly, the 1971 Rule and subsequent Agency guidance recognized that
constructive waivers could occur due to certifying authority inaction.
See 40 CFR 121.16(b) (2019) (providing that constructive waiver
occurred upon the ``failure of the State . . . concerned to act on such
a request for certification within a reasonable period of time after
receipt of such request''); 2010 Handbook at 11 (rescinded in 2019, see
supra) (``State and tribes are authorized to waive [section] 401
certification . . . by the certification agency not taking action.'').
The 2020 Rule's interpretation of what it means for a certifying
authority to fail or refuse to act departed from the longstanding
Agency position on constructive waivers. The 2020 Rule allowed a
Federal agency to determine that a certifying authority had failed or
refused to act, and thereby waived certification--even when the
certifying authority did in fact act on a request for certification
within the reasonable period of time--if the Federal agency found that
the action was somehow procedurally deficient (e.g., did not follow the
2020 Rule's procedural requirements for a denial of certification). 40
CFR 121.9(a)(2) (2020); 85 FR 42266. Similarly, a Federal agency could
determine that a certification condition was waived if the condition
did not comply with procedural requirements of the 2020 Rule. Id. at
42250. This aspect of the 2020 Rule drew considerable pre-proposal
input and public comment to the effect that this interpretation could
result in a Federal agency ``veto'' of a section 401 certification, and
that it was contrary to the statute, the legislative history, and case
law. EPA similarly expressed concern in its Federal Register document
announcing its intent to revise the 2020 Rule, noting that ``a federal
agency's review may result in a state or tribe's certification or
conditions being permanently waived as a result of non-substantive and
easily fixed procedural concerns identified by the federal agency.'' 86
FR 29543 (June 2, 2021).
The 2020 Rule's interpretation of waiver of a certification
decision is not consistent with the plain language of the statute and
its legislative history. The mere failure of a certifying authority to
include certain regulatorily defined elements in its certification
decision or comply with other procedural requirements of section 401,
such as following public notice procedures on a request for
certification, do not qualify as the kind of ``sheer inactivity'' that
Congress contemplated would result in a constructive waiver. This
interpretation also resulted in Federal agencies rejecting
certification decisions intended to prevent adverse water quality
impacts because of fixable procedural concerns. For example, some
commenters noted that use of the 2020 Rule's procedural requirements on
certifications for the Corps' Nationwide General Permits resulted in
certifications with conditions or denials being treated as constructive
waivers. As discussed in section IV.G.2 of this preamble, a
constructive waiver is a severe consequence because a waiver means that
a Federal license or permit which could adversely impact the certifying
authority's water quality (i.e., cause noncompliance with water quality
requirements) may proceed without any input from the certifying
authority. Accordingly, consistent with the statutory language,
legislative history, and prior Agency interpretation, EPA is finalizing
regulatory text to clarify that constructive waivers may occur only if
a certifying authority fails or refuses to take one of the four actions
described in this section within the reasonable period of time.
Consistent with this approach, EPA is also finalizing targeted
conforming revisions to its part 124 and part 122 regulations, where
these regulations previously allowed EPA to find that a certifying
authority waived its right to certify or waived a certification
condition for reasons other than those specified in final rule Sec.
121.9 (failure to act on a request for certification within the
reasonable period of time). EPA is deleting the majority of the
language in 40 CFR 124.53(e)(2) and (3), which allowed EPA to waive
certification conditions that did not meet certain requirements.\75\
See discussion infra for further discussion on the revisions to Sec.
124.53.
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\75\ EPA is also deleting provisions in Sec. 124.53(e) because
its approach to the contents of a certification decision differed
from final rule Sec. 121.7, as explained in preamble section
IV.F.2.d of this preamble.
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EPA is also finalizing revisions to 40 CFR 124.55(c), which allowed
EPA to waive certification conditions or denials that were based on
state law allowing a less stringent permit condition. Specifically, EPA
is deleting the second sentence of Sec. 124.55(c), which allowed EPA
to waive a certification denial or condition. The first sentence of
Sec. 124.55(c) will remain because it is not affected by this final
rule. Finally, EPA is finalizing revisions to 40 CFR 122.44(d)(3),
which allowed EPA to waive certifications that were stayed by a court
or state board under certain circumstances. EPA is deleting the second
and third sentences, which concerned certification waiver. As a result
of these deletions and revisions in EPA's part 124 and part 122
regulations, certification waivers for EPA-issued NPDES permits will be
governed solely by the certification waiver requirements in Sec. 121.9
of the final rule.
d. Contents of a Certification Decision
To further clarify how a certifying authority may ``act on a
request for certification,'' EPA is finalizing recommended contents of
a certification decision at Sec. 121.7(c) through (f) and finalizing a
requirement that all certification decisions be in writing. In a change
from proposal and in support of the cooperative federalism balance
central to section 401, the Agency is not mandating the contents that
certifying authorities must include in their certification decisions.
Instead, the final rule includes recommended contents for a grant of
certification (Sec. 121.7(c)), a grant of certification with
conditions (Sec. 121.7(d)), a denial of certification (Sec.
121.7(e)), and an express waiver of certification (Sec. 121.7(f)). As
discussed in more detail below, these recommended contents are similar
to those proposed (as requirements) with modifications in light of
commenter input. The Agency is also finalizing revisions to the
regulatory text located at Sec. 121.7(a) of the 2020 Rule with minor,
non-substantive revisions to clarify that all certification decisions
should be within the scope of certification and taken within the
reasonable period of time. 40 CFR 121.7(b).
[[Page 66611]]
EPA is finalizing removal of the regulatory text located at Sec.
121.7(b) of the 2020 Rule, which characterized what actions a
certifying authority may take based on its evaluation of the request
for certification. EPA believes it is redundant to retain separate
regulatory text restating the same ideas as final rule Sec. 121.7(a)
and (c) through (f).
While the statute provides that certifying authorities may make one
of four decisions when processing a request for certification, the CWA
does not explicitly describe the contents or elements of a
certification decision. EPA's 1971 Rule defined the contents of a
certification and express waiver decision for all certifying
authorities. The 1971 Rule's enumeration of the contents of a
certification decision was simple but effective and included the name
and address of the applicant, a statement that the certifying authority
examined the application, a statement that ``there is a reasonable
assurance that the activity will be conducted in a manner which will
not violate applicable water quality standards,'' and other information
deemed appropriate by the certifying authority. 40 CFR 121.2(a) (2019).
In addition, the 1971 Rule provided that a certification could be
waived upon either (1) written notification from the certifying
authority that it expressly waived its authority to act on a request,
or (2) written notification from the Federal licensing or permitting
agency regarding the failure of the certifying authority to act on a
request for certification within the reasonable period of time. 40 CFR
121.16 (2019). The 1971 Rule did not define the contents of a
certification denial or provide specific requirements for how to
articulate and incorporate a certification condition.
In the 2020 Rule, EPA updated those requirements for each type of
certification decision and more fully addressed the effects of those
decisions. First, it provided that, when a certifying authority granted
certification under the 2020 Rule, the certification must be in writing
and include a written statement that the discharge from the proposed
project would comply with water quality requirements. 40 CFR 121.7(c)
(2020); 85 FR 42286.
Second, when a certifying authority granted certification with
conditions, the 2020 Rule required that the certifying authority
explain the necessity of each condition and provide a citation to an
applicable Federal, state, or Tribal law. 40 CFR 121.7(d) (2020); 85 FR
42286. This was a change from the 1971 Rule, which broadly provided for
certifying authorities to include conditions as they ``deem[ed]
necessary or desirable.'' 40 CFR 121.2(a)(4) (2019). The 2020 Rule
preamble stated that the requirements were ``intended to increase
transparency and ensure that any limitation or requirement added to a
certification . . . is within the scope of certification.'' 85 FR
42256. EPA observes that this provision was similar to EPA's current
NPDES program-specific section 401 regulations. See 40 CFR 124.53(e)(2)
(2023) (requiring a citation for any conditions more stringent than
those in the draft permit).\76\
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\76\ The Agency is finalizing revisions to the part 124
regulations where such provisions are inconsistent with this final
rule, including deleting 40 CFR 124.53(e)(2). See discussion infra.
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Third, unlike the 1971 Rule, under which certification denials were
undefined, the 2020 Rule defined the contents of a denial decision.
Specifically, the 2020 Rule required certification denials to be made
in writing and to identify any water quality requirements with which
the discharge will not comply, include a statement explaining why the
discharge would not comply with those requirements, and provide any
specific water quality data or information that would help explain a
denial based on insufficient information. 40 CFR 121.7(e) (2020); 85 FR
42286.
Fourth, the 2020 Rule included similar language to the 1971 Rule
for express waivers and required written notification from the
certifying authority indicating an express waiver of its authority to
act on a request for certification. 40 CFR 121.9(a)(1) (2020); 85 FR
42286. Lastly, under the 2020 Rule, EPA defined constructive waiver as
a certifying authority's ``failure or refusal to act on a certification
request'' which included failing or refusing to (1) act within the
reasonable period of time, (2) satisfy the procedural requirements for
a grant or denial of certification imposed by the 2020 Rule, or (3)
comply with other procedural requirements of section 401 (e.g., provide
public notice on a certification request). 40 CFR 121.9(a)(2) (2020);
85 FR 42286. The 2020 Rule also provided that condition-specific
waivers could occur if the certifying authority failed to satisfy the
procedural requirements imposed by the 2020 Rule for certification
conditions. 40 CFR 121.9(b) (2020); 85 FR 42286. See section IV.G in
this preamble for further discussion on constructive waivers and the
role of Federal agencies.
The stated purpose of the 2020 Rule requirements was to promote
transparency and consistency in certification decisions and to help
streamline the Federal licensing and permitting processes. 85 FR 42220.
However, in pre-proposal input, several certifying authorities said
that the 2020 Rule's requirements for the contents of certification
decisions delayed rather than streamlined the certification process.
Conversely, in pre-proposal outreach, project proponents expressed
interest in keeping the 2020 Rule requirements for the added
transparency and argued that it is helpful when certifying authorities
explain their final certification decisions (especially denials). In
response to this mixed input, the Agency proposed to include some
requirements for each of the four types of certification decisions. The
Agency intended for this approach to address both the workload concerns
expressed by certifying authorities, and the desire of project
proponents for increased transparency and consistency in the
certification process.
Some commenters supported the proposed rule's approach, including
the removal of the 2020 Rule requirements to include specific statutory
or regulatory citations for each certification condition and denial,
and retaining the inclusion of a statement explaining why each of the
included conditions is necessary to assure that the activity as a whole
will comply with water quality requirements. Commenters argued that the
explanation requirement would provide transparency and regulatory
certainty. However, some commenters asserted that any content
requirements imposed by EPA would place an undue burden on the
certifying authority and recommended that the Agency remove all content
requirements. Conversely, some other commenters expressed interest in
keeping the 2020 Rule requirements, including a few commenters who
argued that citations are necessary for legally defensible
certification decisions, to provide transparency, and to enable the
project proponent and the public to understand the rationale for a
condition.
After reviewing public comments, the Agency is not finalizing any
requirements for certification decisions. Before the 2020 Rule, EPA did
not impose requirements on certifying authorities regarding what
information they must include in a denial or what information they must
include to support a certification condition. EPA is not aware of any
major issues regarding clarity or information in certification denials
or conditions. Instead of mandating detailed requirements for
certifying authorities, the final rule identifies recommended contents
for a grant of certification, a grant of certification with conditions,
a denial of
[[Page 66612]]
certification, and an express waiver of certification. This approach
addresses workload concerns expressed by certifying authorities and, in
support of the cooperative federalism balance central to section 401,
provides certifying authorities with the flexibility to determine how
best to communicate certification decisions to project proponents and
Federal agencies. It also will eliminate unnecessary potential disputes
about whether a certifying authority complied with EPA-issued
requirements for certification decision documents (in addition to
whatever requirements the certifying authority imposes on itself). EPA
expects certifying authorities understand the importance of clear,
transparent communication with project proponents and Federal agencies.
Indeed, it is in the certifying authority's own interests to clearly
convey the reasoning and rationale behind its action. To encourage
development of clear certification decisions, the Agency is identifying
recommended--but not required--contents for each certification decision
type at final rule Sec. 121.7(c) through (f). These contents are
similar to the contents proposed (to be required) at Sec. 121.7(c)
through (f), with modifications based on stakeholder input. See
discussion infra. The recommended contents should provide transparency
and consistency in the certification process, particularly where a
certifying authority does not have a standard approach for the contents
of a certification decision. For its part, the Agency intends to
include these contents in certification decisions when it acts as a
certifying authority and encourages other certifying authorities to
include similar contents in their certification decisions. However, the
final rule approach provides certifying authorities with the
flexibility to add different or additional elements or information
requirements to any of these four certification decisions to provide
stakeholders with additional clarity and transparency. For example, a
certifying authority may choose to require a citation to applicable
Federal or state or Tribal water quality requirements to support a
certification condition.
As discussed above, the Agency is recommending, as opposed to
requiring, additional contents for each type of certification decision.
Before discussing the specific contents of each certification decision
in more detail, the Agency would like to address the recommended
contents that are the same or similar in all four certification
decisions. First, consistent with the 2020 Rule, the Agency has opted
to retain language in the recommended contents of a certification
decision consistent with the 1972 statutory language. Unlike the 2020
Rule, the 1971 Rule included language that reflected the predecessor
statute. As discussed in section III in this preamble, the 1972 CWA
revised the predecessor version of section 401 that the 1971 Rule
relied upon. To continue to account for this change to the statutory
text, the Agency is retaining a similar provision as the 2020 Rule that
certification decisions to grant, grant with conditions, or deny
certification should indicate whether the certifying authority has
determined that an activity will comply with the water quality
requirements identified in the CWA, not just water quality
standards.\77\ Unlike the 2020 Rule, EPA is finalizing that
certification decisions should indicate whether the activity, as
opposed to the discharge, will comply with water quality requirements.
See section IV.E of this preamble for further discussion on the scope
of certification.
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\77\ The 1971 Rule required a certification issued by any
certifying authority to include, ``A statement that there is a
reasonable assurance that the activity will be conducted in a manner
which will not violate applicable water quality standards.'' 40 CFR
121.2(a)(3) (2019) (emphasis added).
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Similar to the Agency's position in the 2020 Rule, the Agency does
not think that retaining the 1972 statutory language ``will comply'' in
the regulations requires certifying authorities to provide absolute
certainty that applicants for a Federal license or permit will never
violate water quality requirements. See 85 FR 42278. This is not EPA's
intention, and EPA does not think such a stringent interpretation is
required by the statutory or final regulatory language. The use of
language comparable to ``will comply'' is not uncommon in CWA
regulatory programs. For example, CWA section 402 contemplates that
NPDES permits will only be issued upon a showing that a discharge
``will meet'' various enumerated provisions of the CWA. 33 U.S.C.
1342(a). This standard has not precluded states, Tribes, or EPA from
routinely issuing CWA compliant NPDES permits to allow pollutant
discharges, nor has it resulted in permits that are impossible for
permittees to comply with.
Nor does EPA expect that the use of ``will comply'' will impede or
limit a certifying authority's ability to act on a request for
certification or prevent a certifying authority from relying on
modeling information, which provides an informed projection of
potential impacts, to make a certification decision. When a certifying
authority makes a certification decision, it would be certifying that
the activity will comply with water quality requirements for the life
of the Federal license or permit and not just at the moment the Federal
license or permit is issued. The lifespan of FERC licenses can be
decades, whereas CWA section 402 or 404 permits usually last five
years. Given the possible lifespan of a Federal license or permit, and
the possibility that water quality-related changes or impacts may
occur, for example, due to climate change or other factors during that
time, it is reasonable (and perhaps essential in some cases) for
certifying authorities to rely on modeling to inform certification
decisions. EPA does not intend or expect the use of the term ``will
comply'' to limit or impact a certifying authority's ability to rely on
such modeling to support its certification decisions.
Second, the Agency continues to require all certification decisions
to be in writing. While the Agency is not aware of any certification
decisions being provided in a different manner (e.g., verbally), EPA is
finalizing the requirement that all certification decisions be in
writing to ensure the project proponent and Federal agency can clearly
understand the certification decision and, for a certification with
conditions, any conditions that must be included in the Federal license
or permit.
Third, the Agency is removing the inclusion of the name and address
of the project proponent from the list of recommended contents of each
certification decision. The Agency finds this component unnecessary
since the certification will be included with the Federal license or
permit that will identify the appropriate project proponent. However,
the Agency is retaining the identification of the applicable Federal
license or permit as one of the recommended components for all
certification decisions. A few commenters suggested that the final rule
should remove any requirements to include the identification of the
Federal license or permit. While this final rule is only recommending
the identification of the Federal license or permit, the Agency
observes that there must be a Federal license or permit to trigger the
section 401 process. As such, the Agency intends for this component to
help clarify which Federal license or permit the certification decision
applies to.
Fourth, the Agency is adding regulatory text that encourages
certifying authorities to clearly identify the certification decision
type (i.e.,
[[Page 66613]]
grant, grant with conditions, denial, or waiver) to ensure project
proponents and Federal agencies can easily understand the nature of the
certification decision. This is particularly important for Federal
agencies who need to look at a certification decision to determine how
it should act in response. For example, if a certifying authority
denies certification, the Federal agency cannot issue the Federal
license or permit. Similarly, if a certifying authority grants
certification with conditions, the Federal agency must include those
conditions in its Federal license or permit.
Lastly, the Agency is adding regulatory text that encourages a
certifying authority to indicate that it complied with its public
notice procedures established pursuant to CWA section 401(a)(1). As
discussed in section IV.G in this preamble, Federal agency review is
limited to verifying compliance with the requirements of CWA section
401, including whether the certifying authority confirmed it complied
with its public notice procedures established pursuant to CWA section
401(a)(1). See 40 CFR 121.8. The language added throughout Sec. 121.7
is intended to aid this aspect of Federal agency review. EPA is not
defining how exactly a certifying authority must indicate in its
certification decision that it complied with public notice procedures.
Instead, a certifying authority may choose to demonstrate that it
complied with its public notice procedures as it sees fit, including
but not limited to, by including a copy of the public notice in its
certification decision, by including a description of the public notice
process it undertook in the certification decision, or by simply
including an attestation statement in the certification decision that
the certifying authority complied with its public notice procedures.
While the above paragraphs address aspects of the recommended
components that are the same for all certification decisions, the
following paragraphs describe the individual requirements EPA is
recommending for each of the four kinds of certification decisions.
First, any grant of certification should (1) identify the decision
as a grant of certification, (2) identify the applicable Federal
license or permit, (3) include a statement that the activity ``will
comply'' with water quality requirements, and (4) indicate that the
certifying authority complied with its public notice procedures
established pursuant to CWA section 401(a)(1). While the 1971 Rule
required a statement that there was ``reasonable assurance,'' 40 CFR
121.2(a) (2019), as explained above, the 2020 Rule and this final rule
use the term ``will comply'' which is more consistent with the 1972
statutory language used in sections 401(a)(1) and 401(d).
Second, EPA is finalizing that any grant of certification with
conditions should (1) identify the decision as a grant of certification
with conditions, (2) identify the applicable Federal license or permit,
(3) include a statement explaining why each condition is necessary to
assure that the activity will comply with water quality requirements,
and (4) indicate that the certifying authority complied with its public
notice procedures established pursuant to CWA section 401(a)(1). The
Agency proposed that a grant of certification must include any
conditions necessary to assure that the activity as a whole will comply
with applicable water quality requirements. Due to the change in
approach to include recommended components, as opposed to required
components, for certification decisions, the Agency is removing the
proposed text at Sec. 121.7(d)(2) and instead adding text at final
rule Sec. 121.3(b) that requires certifying authorities to include any
conditions necessary to assure that the activity will comply with
applicable water quality requirements. The text at final rule Sec.
121.3(b) reflects the language used in section 401(d).
The Agency recommends that certifying authorities include a
statement explaining why each of the included conditions is necessary
in a certification with conditions, consistent with proposed Sec.
121.7(d)(3).\78\ A few commenters expressed concern over how such
justifications should be included in a certification decision,
including arguing that it would interfere with readability or
suggesting grouping explanations instead of requiring an explanation
for each condition. Although the Agency is not requiring the inclusion
of a statement explaining why a condition is necessary, EPA finds that
including such a statement will help project proponents and Federal
agencies understand the reason for the condition and assist in its
implementation. As discussed in the implementation section below, there
are several ways a certifying authority can include this information in
a certification decision to aid readability for ease of implementation,
such as including justifications in an addendum to the certification.
See infra. EPA anticipates that such information is readily available
to the certifying authority as part of its decision-making process.
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\78\ The Agency recommends including at least a succinct
explanation for the certification condition(s) to provide necessary
transparency and clarity for project proponents and Federal
agencies. As a practical matter, certifying authorities will likely
already have developed and considered such information as part of
their decision-making process and included it in the record to
substantiate their decision. Aside from borrowing from their
decision-making record, EPA expects that certifying authorities may
be able to satisfy this requirement in a number of ways. For
example, certifying authorities could identify specific water
quality requirements with which the activity will not comply without
the condition.
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Consistent with the final rule's shift to recommended contents of a
certification decision, the Agency is not requiring certifying
authorities to include a specific statutory or regulatory citation in
support of a certification condition. Rather, the Agency will let
certifying authorities decide what relevant information to provide in
support of any conditions. EPA encourages certifying authorities to
work with project proponents and Federal agencies to determine what
information would be most useful (e.g., statutory or regulatory
citations). Additionally, EPA is not distinguishing between
certification decisions based on an individual or a general Federal
license or permit. Although EPA made such a distinction in the 2020
Rule, EPA finds it unnecessary here because it is no longer defining
required certification decision contents and the recommended contents
would apply to a certification with conditions regardless of the nature
of the Federal license or permit.
Third, EPA is finalizing that any denial of certification should
(1) identify the decision as a denial of certification, (2) identify
the applicable Federal license or permit, (3) include a statement
explaining why the certifying authority cannot certify that the
proposed activity will comply with water quality requirements,
including but not limited to a description of any missing water
quality-related information if the denial is based on insufficient
information, and (4) indicate that the certifying authority complied
with its public notice procedures established pursuant to CWA section
401(a)(1). Although the 1971 Rule did not define the elements of a
decision to deny certification, this concept was introduced in the 2020
Rule. The recommended contents for a denial of certification are
similar to the requirements in the 2020 Rule. The Agency did not
propose to retain the regulatory text located at Sec. 121.7(e)(2)(iii)
of the 2020 Rule, which required a certifying authority to describe
specific water quality data or
[[Page 66614]]
information that would be needed if the denial is due to insufficient
information. As discussed in the preamble to the proposed rule, the
Agency noted that certifying authorities could provide this sort of
information to satisfy the regulatory requirement at Sec. 121.7(e)(2)
to include a statement explaining why the certifying authority cannot
certify that the activity as whole will comply with water quality
requirements. 87 FR 35353. However, some commenters argued that denials
due to insufficient information should, as in the 2020 Rule, include an
explanation of what information was missing. Although the Agency is not
requiring any specific information for denials of certification, the
Agency is adding language at final rule Sec. 121.7(e)(3) to clarify
that statements explaining why a certifying authority cannot certify
that the activity will comply with water quality requirements may
include, but are not limited to, a description of any missing water
quality-related information if the denial is based on insufficient
information.
The Agency recommends including at least a succinct explanation for
the certification denial to provide necessary transparency and clarity
for project proponents and Federal agencies. As a practical matter,
certifying authorities will likely already have developed and
considered such information as part of their decision-making process
and included it in the record to substantiate their decision. Aside
from borrowing from their decision-making record, EPA expects that
certifying authorities may be able to satisfy this requirement in
several ways. For example, certifying authorities could identify
specific water quality requirements with which the activity will not
comply, or identify what information about the project or potential
water quality effects is missing or incomplete that led the certifying
authority to not be able to determine whether the activity will comply
with water quality requirements. EPA anticipates that certifying
authorities will work with project proponents and Federal agencies to
determine what information would be most useful. Additionally, EPA is
not distinguishing between certification decisions based on an
individual or a general Federal license or permit. Although EPA took
this approach in the 2020 Rule, EPA is no longer defining required
certification decision-specific contents and the recommended contents
would apply to a denial of certification regardless of the nature of
the Federal license or permit.
Lastly, EPA is finalizing that any express waiver made by a
certifying authority should (1) identify the decision as an express
waiver of certification, (2) identify the applicable Federal license or
permit, (3) include a statement that the certifying authority expressly
waives its authority to act on the request for certification, and (4)
indicate that the certifying authority complied with its public notice
procedures established pursuant to CWA section 401(a)(1). This approach
is consistent with the 1971 Rule and 2020 Rule, except the final rule
merely recommends inclusion of such a statement of express waiver
instead of requiring it. As noted above, an express waiver indicates
only that the certifying authority has chosen not to act on a request
for section 401 certification. Accordingly, the certifying authority
would only need to state that it is waiving certification and would not
need to make any statement about why it has decided to waive or its
assessment of the project's impact on its water quality.
In this final rule, EPA is also, in large part, finalizing removal
of 40 CFR 124.53(e)(1) through (3), which address the contents of a
certification for an EPA-issued NPDES permit. EPA proposed to delete of
the entirety of Sec. 124.53. See 87 FR 35357. Most of the contents
identified at Sec. 124.53(e) are not consistent with the contents
identified at Sec. 121.7(d) and (e). For example, Sec. 124.53(e)(2)
required a citation (but not an explanation) for each condition of
certification, whereas final rule Sec. 121.7(e) recommends including
an explanation (but not a citation) for each condition. Further, Sec.
124.53(e)(1) identified what conditions must be included in a
certification but did not match the conditions identified at final rule
Sec. 121.3(b). Final rule Sec. 121.3(b) incorporates the final rule's
concepts of the entire ``activity'' scope of review and ``water quality
requirements'' while Sec. 124.53(e)(1) did not. To be clear, all
certification decisions, including those on EPA-issued NPDES permits,
must comply with this final rule Sec. 121.3(b). As discussed above,
certifying authorities may work with EPA and/or project proponents to
determine what information would be most useful to include in a
certification with conditions on an EPA-issued NPDES permit (e.g., a
citation to the CWA or state law for conditions more stringent than
those in the draft permit).
EPA is finalizing revisions to Sec. 124.53(e)(3), now Sec.
124.53(e), which allows, but does not require, certifying authorities
to include a statement in a grant of certification regarding the extent
to which each condition of the draft permit can be made less stringent
without violating the requirements of state law, including water
quality standards. EPA has concluded that this provision, as finalized,
is not inconsistent with the Agency's approach to certification
decisions in the final rule because it is a recommended and not
required component of a certification decision. This provision will
assist the NPDES program in its implementation by ensuring that permit
conditions in final NPDES permits are consistent with state law.
However, any statement included pursuant to Sec. 124.53(e) would be
informational, for the benefit of EPA permit writers, and would not be
a condition of certification. Section 124.53(e) would not allow the
Agency to reject or modify certification conditions; rather, this
provision allows certifying authorities to provide EPA with input on
draft permit conditions. This is not the only opportunity for a
certifying authority to provide input on draft NPDES permit conditions.
Certifying authorities could also provide input on draft NPDES permit
conditions through the public notice process or upon review of a draft
NPDES permit.
3. Implementation
A few commenters suggested that the definition of ``to act'' needed
additional clarity to state the that the four actions proposed are the
only ways in which a certifying authority may ``act'' on a request for
certification. EPA finds that the regulatory text at final rule Sec.
121.7(a) clearly provides that the four decisions (grant, grant with
conditions, denial, express waiver) are the only ways in which a
certifying authority may act. However, EPA wishes to clarify that any
attempt at a ``hybrid'' version of those four decisions does not meet
the standard of ``acting'' on a request for certification (e.g., a
waiver with conditions, a conditional denial). See Waterkeepers
Chesapeake, et al. v. FERC, 56 F.4th 45, 49 (D.C. Cir. 2022) (holding
that FERC could not issue a license ``[i]f a state has neither granted
a certification nor failed or refused to act on a certification
request'' and finding that ``Maryland's subsequent backtracking in the
settlement agreement, in which it `conditionally waiv[ed]' its
authority to issue a water quality certification after the fact, is
neither a `fail[ure]' nor a `refus[al]' to act'' and therefore could
not ``qualify as a section 401(a)(1) waiver.''). To further clarify how
a certifying authority may act on a request for certification, the
Agency is finalizing regulatory text that encourages certifying
authorities to clearly identify whether a decision is a grant, grant
with conditions, denial, or express waiver.
[[Page 66615]]
As discussed above, EPA is not defining how exactly a certifying
authority must indicate in its certification decision that it complied
with public notice procedures. Instead, a certifying authority may
choose how it wishes to demonstrate that it complied with its public
notice procedures. Possible options include, but are not limited to,
providing a copy of the public notice in its certification decision,
describing in the certification decision the public notice process it
undertook, checking a checkbox that indicates that the certifying
authority complied with public notice procedures, or including an
attestation statement that the certifying authority complied with its
public notice procedures.
Although the Agency is no longer requiring certifying authorities
to include decision-specific contents in each of the four certification
decisions, the Agency strongly encourages certifying authorities to
include the recommended contents located at final rule Sec. 121.7(c)
through (f). EPA finds these recommended contents best reflect the
types of information project proponents and Federal agencies may need
to clearly understand and easily implement a certification decision.
Specifically, clearly identifying the nature of the certification
decision (i.e., a grant, grant with conditions, denial, or waiver) is
an important way to promote transparency and to avoid
misunderstandings. The Agency believes all recommended contents should
be readily available to the certifying authority as part of its
decision-making process, and therefore easily incorporated into a
certification decision.
The Agency received comments expressing concern over providing a
justification statement for each certification condition because of
readability concerns. To be clear, the Agency is not requiring these
contents to be included in certification decisions, nor prescribing how
they should be incorporated into a certification decision.
Nevertheless, EPA believes there are several options to address such
readability concerns and still provide the recommended information. For
example, a certifying authority may choose to include explanations
(e.g., statement, citations, etc.) immediately following the
certification condition it supports. Alternatively, a certifying
authority could organize those explanations in the form of a table and
reference them in the document. Either of those methods is an
acceptable way to provide the support for why the conditions are
necessary.
The recommended contents for certification decisions found at final
rule Sec. 121.7(c) through (f) do not represent the totality of
information that a certifying authority may find useful to share with
project proponents and Federal agencies.\79\ Certification decisions
can act as important implementation tools for certifying authorities to
convey best practices, rationales, and other pertinent information to
both project proponents and Federal agencies. However, for
certifications with conditions, it is important to clearly indicate
what information is merely background or supplementary information as
opposed to the actual conditions that must be incorporated into the
Federal license or permit. For example, when EPA acts as the certifying
authority it clearly denotes which aspects of the certification with
conditions are general information versus the actual certification
conditions. Clearly parsing out this information in the decision
document ensures project proponents are best positioned to understand
and comply with certification conditions.
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\79\ As discussed above, the Agency intends to include the
recommended contents in certification decisions when it acts as a
certifying authority and encourages other certifying authorities to
include similar contents in their certification decisions.
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Related to the importance of clearly communicating certification
decisions to project proponents and Federal agencies is the importance
of drafting clear certification conditions. EPA recognizes that
certification conditions are an important tool that enable certifying
authorities to ensure that projects needing Federal licenses or permits
will be able to move forward without adverse impacts to water quality.
EPA encourages certifying authorities to develop certification
conditions in a way that enables projects to adapt to future water
quality-related changes, i.e., so-called ``adaptive management
conditions.'' For example, if a certifying authority is concerned about
future downstream, climate change-related impacts on aquatic species
due to increased reservoir temperatures during the lifespan of a
hydropower dam license, the certifying authority might develop a
condition that would require a project proponent to take subsequent,
remedial action in response to reservoir temperature increases (e.g.,
conditions that might require monitoring and, as necessary, a change in
reservoir withdrawal location in the water column, a change in the
timing of releases, etc.).
The Agency wishes to clarify the nature and effect of adaptive
management conditions. A few commenters asserted that adaptive
management conditions are the same as ``reopener'' clauses and that
they are important to ensure water quality resources will be protected
throughout the life of the project if the project changes or conditions
of the waters impacted by the project change. Conversely, one commenter
asserted that certifying authorities should not be able to add adaptive
management conditions to certifications because such conditions are
reopener conditions that could lead to new conditions being
incorporated into the Federal permit long after the certification is
issued. EPA agrees that adaptive management conditions are an important
tool to enable a certification to assure that the project will comply
with water quality activities over the life of the project. However,
the Agency disagrees that these conditions are the same as ``reopener''
clauses.\80\ Reopener clauses purport to authorize a certifying
authority to ``reopen'' and modify a certification at a later date,
sometimes due to the occurrence of a specific event. As discussed at
section IV.I of this preamble, certifying authorities cannot
``bootstrap'' themselves greater authority to modify a certification
beyond what is authorized in this final rule at Sec. 121.10. On the
other hand, adaptive management conditions are set at the time the
certification is granted and provide a concrete action that must occur
in the event certain criteria are met. The text of an adaptive
management condition does not change after certification is granted.
This promotes regulatory certainty, in contrast with a unilateral
modification pursuant to a ``reopener'' clause. For example, a
condition may require a project proponent to increase monitoring
efforts or conduct remediation if the baseline, routine monitoring
established in the certification reveals an increase in a specific
pollutant due to the activity. To ensure project proponents and Federal
agencies understand and are able to implement any such adaptive
management conditions, EPA recommends that certifying authorities
clearly define and explain in the certification document the basis for
these conditions and the circumstances in which adaptive management
conditions would require action by the project proponent (e.g.,
expectations for undertaking additional planning and
[[Page 66616]]
monitoring; thresholds triggering adaptive responses; requirements for
ongoing compliance). EPA has previously acknowledged the use of
``adaptive management'' conditions in prior guidance, see, e.g., 2010
Handbook at 32 (rescinded in 2019, see supra).
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\80\ See discussion in section IV.I of this preamble about
``reopener'' clauses or conditions and the Agency's position on a
certifying authority's ability to unilaterally modify a
certification after the reasonable period of time.
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Once a certifying authority acts on a request for certification,
the certifying authority should send the certification decision to the
project proponent requesting certification. Ultimately, section
401(a)(1) requires the project proponent to provide the Federal agency
with the certification from a certifying authority. However, EPA
encourages certifying authorities to include Federal agencies on any
certification decision transmittal to the project proponent to ensure
all parties have a clear, consistent understanding of the status of the
decision (e.g., copy the Federal agency point of contact on email
correspondence).
G. Federal Agency Review
1. What is the Agency finalizing?
The Agency is finalizing regulatory text at Sec. 121.8 to clarify
that Federal agency review is limited to verifying compliance with the
requirements of CWA section 401. Specifically, the final rule provides
that to the extent a Federal agency verifies compliance with the
requirements of CWA section 401, its review is limited to (1) whether
the appropriate certifying authority issued the certification decision;
(2) whether the certifying authority confirmed it complied with its
public notice procedures established pursuant to section 401(a)(1); and
(3) whether the certifying authority acted on the request for
certification within the reasonable period of time. 40 CFR 121.8. EPA
proposed at Sec. 121.9 that Federal agency review of a certification
decision is limited to confirming four factors: the nature of the
decision, that the proper certifying authority issued the decision,
that the certifying authority complied with its own public notice
procedures for a request for certification, and that the decision was
issued in the reasonable period of time. As discussed in more detail
below, the Agency removed the first factor (the nature of the decision)
and modified the third factor to clarify that Federal agency review is
limited to verifying that the certifying authority confirmed compliance
with its public notice procedures. Aside from the three elements listed
at Sec. 121.8, EPA concludes that Federal agencies lack the authority
to review other aspects of a certification decision for purposes of
determining whether a ``certification required by [section 401] has
been obtained or has been waived.'' 33 U.S.C. 1341(a)(1).
As proposed, the Agency is declining to define how a certifying
authority must demonstrate its compliance with the three CWA section
401 requirements listed above. See 87 FR 35356 (June 9, 2022). The
Agency proposed at Sec. 121.9(b) to define a process that a Federal
agency must follow if it determined that a certification decision did
not indicate the nature of the certification decision or the certifying
authority did not provide public notice on the request for
certification. As discussed below, the Agency is not finalizing Federal
agency review for whether the certification decision indicates the
nature of the decision, and therefore EPA need not finalize a
subsequent process. Although the final rule allows Federal agencies to
verify that a certifying authority confirmed compliance with its public
notice procedures, the Agency is returning to its pre-2020 Rule posture
and declining to define a process that Federal agencies must follow if
they are unable to verify compliance. The Agency is finalizing as
proposed a process for the Federal agency to follow if it determines
that a certifying authority failed or refused to act within the
reasonable period of time at final rule Sec. 121.9(b). Specifically,
Sec. 121.9(b) requires the Federal agency to promptly notify the
certifying authority and project proponent in writing that the
certification requirement has been waived and that such notice from the
Federal agency shall satisfy the project proponent's obligation under
CWA section 401.
The Agency has also reorganized the regulatory text to move the
Federal agency review provision to Sec. 121.8, before the provision in
the final rule regarding what it means to fail or refuse to act. The
Agency believes this reorganization will more clearly communicate that
a Federal agency may only determine that a certifying authority
inadvertently waived where a certifying authority fails or refused to
act within the reasonable period of time. The text as finalized
represents the best reading of the text of section 401, congressional
intent, and relevant case law, and incorporates recommendations from
public comments received on the proposed rule.
2. Summary of Final Rule Rationale and Public Comment
Section 401 does not explicitly provide a defined role for Federal
licensing or permitting agencies to review certifications. However, the
Agency has long recognized, both in regulation and guidance, that some
degree of Federal agency review of certification decisions is
appropriate. The 1971 Rule provided Federal agencies with the ability
to determine whether a certifying authority acted within the reasonable
period of time. See 40 CFR 121.16(b) (2019) (``The certification
requirement with respect to an application for a license or permit
shall be waived upon . . . Written notification from the licensing or
permitting agency to the Regional Administrator of the failure of the
State or interstate agency concerned to act on such request for
certification within a reasonable period of time after receipt of such
request . . .''). Prior EPA guidance acknowledged that the Federal
licensing or permitting agency may review the procedural requirements
of a certification decision. 2010 Handbook at 32 (rescinded in 2019,
see supra) (``For example, the federal permitting or licensing
authority may review the procedural requirements of [section] 401
certification, including whether the proper state or tribe has
certified, whether the state or tribe complied with applicable public
notice requirements, and whether the certification decision was
timely.'') (citing American Rivers, 129 F.3d at 110-111; City of Tacoma
v. FERC, 460 F.3d 53, 68 (D.C. Cir. 2006)). However, this prior
guidance also acknowledged the limitations of Federal agency review and
stated that Federal agencies cannot pick and choose among a certifying
authority's certification conditions. Id. at 10 (citing American
Rivers, 129 F.3d at 110-11).
A number of courts have acknowledged a limited role for Federal
agencies to ensure that a certifying authority meets certain statutory
requirements of section 401. The D.C. Circuit has held that section
401(a)(1) authorized FERC, as the relevant Federal licensing agency,
``to determine that the specific certification `required by [section
401 has] been obtained,' '' because otherwise, ``without that
certification, FERC lack[ed] authority to issue a license.'' City of
Tacoma, 460 F.3d at 67-68 (``If the question [raised to FERC] regarding
the state's section 401 certification is not the application of state
water quality standards but compliance with the terms of section 401,
then FERC must address it.''). The court did not define what a
``certification required by this section'' included, but suggested it
included at a minimum, ``explicit requirement[s] of section 401,''
including that the certifying authority provide public notice, which
was the section 401 requirement at issue in the case before
[[Page 66617]]
the court. Id. at 68. It is important to note that, while the court
found that FERC had an obligation under the facts of that case to
confirm the public notice requirement was satisfied, the court did not
frame this requirement as a prerequisite in every instance where the
agency is presented with a certification decision. Rather, the court
found that FERC had to confirm compliance in the case before it because
public notice had been ``called into question.'' See id.
In an earlier case, the Second Circuit ruled that FERC did not have
authority to substantively review certification conditions to ``decide
which conditions are within the confines of [section] 401(d) and which
are not.'' American Rivers, 129 F.3d at 107. In reaching this
conclusion, the court noted that FERC nonetheless did have authority to
determine whether the appropriate certifying authority issued the
certification decision and whether the certification decision was
issued within the reasonable period of time. The court explained that
``[w]hile [FERC] may determine whether the proper state has issued the
certification or whether a state has issued a certification within the
prescribed period, [FERC] does not possess a roving mandate to decide
that substantive aspects of state-imposed conditions are inconsistent
with the terms of [section] 401.'' Id. at 110-11.
In a more recent case, the D.C. Circuit upheld a FERC order
declining to weigh in on the validity of a certifying authority's
denials of certification. Turlock Irrigation Dist. v. FERC, 36 F.4th
1179 (D.C. Cir. 2022). At issue in the case was the re-licensing of two
hydroelectric facilities. Id. at 1181. The hydroelectric facilities
argued that the denials were invalid under the facts of the case.\81\
FERC found that no party disputed that the certifying authority denied
the requests (without prejudice). Turlock Irrigation Dist. Modesto
Irrigation Dist., 174 FERC ] 61,042, 61,175 (2021). ``FERC reasoned
that the [certifying authority], `by denying the applications without
prejudice, indeed acted on [ ] them. . . .' '' Turlock, 36 F.4th at
1182. FERC declined the facilities' invitation to decide whether the
denials where nonetheless somehow ``invalid'' under Federal law
``because they were `on non-substantive grounds' and not `on the
technical merits of the certification requests.' '' Id. at 1182-83.
FERC ``conclude[d] that it is not the [FERC] Commission's role to
review the appropriateness of a state's decision to deny
certification.'' 174 FERC at ] 61,176. The Court of Appeals upheld
FERC's order.\82\ Turlock, 36 F.4th at 1184.
---------------------------------------------------------------------------
\81\ For the certification requests of both hydropower
facilities, the certifying authority denied certification without
prejudice to re-request certification within days of the expiration
of the one year reasonable period of time. Id. The facilities re-
requested certification and, about one year later, the certifying
authority did so again. The certifying authority gave as the reason
for denial that the project proponents had not completed the state
environmental review process, which the certifying authority was
required by law to consider in making its certification decision.
Id. The Agency takes no position here regarding repeated denials
without prejudice, generally for the same reasons as it is not
taking a position regarding repeated withdrawal and resubmittals
(e.g., the inquiry is highly fact specific and the caselaw is in
flux). See section IV.D.2.c of this preamble.
\82\ The petitioners in the D.C. Circuit case petitioned the
Supreme Court for certiorari but the Supreme Court denied the
petition on April 17, 2023. Turlock Irrigation District and Modesto
Irrigation District v. FERC, et al., Docket No. 22-616.
---------------------------------------------------------------------------
The 2020 Rule went a step further than the Federal agency review
recognized by courts. The 2020 Rule required Federal agencies to
review, in every instance, a certification decision to confirm that
several requirements are met, including non-statutory requirements
imposed by the 2020 Rule, as a prerequisite to accepting the
certification decision. 85 FR 42267 (July 13, 2020). The 2020 Rule
required the Federal licensing agency to ensure (1) compliance with
``other procedural requirements of section 401'' (which included public
notice requirements), (2) compliance with the reasonable period of
time, and (3) compliance with the rule's requirements related to
providing a legal and technical basis within the certification document
for the action taken. The 2020 Rule preamble explained that ``[i]f a
federal agency, in its review, determines that a certifying authority
failed or refused to comply with the procedural requirements of the
Act, including the procedural requirements of this final rule, the
certification action, whether it is a grant, grant with conditions, or
denial, will be waived.'' Id. at 42266. The 2020 Rule took the same
approach with review of individual conditions, i.e., if a condition
does not meet procedural requirements, it is waived (even though the
certification itself stands). Id. at 42263. The 2020 Rule did not
extend Federal agency review to more substantive requirements of the
Act (e.g., whether a certification decision was within the scope of
certification). Id. at 42267.
The 2020 Rule contained little direction to Federal agencies about
how to conduct the required review (e.g., how to confirm public notice
took place), other than noting in the preamble that the Federal
agency's review role does not require the agency to ``make a
substantive inquiry into the sufficiency of the information provided in
support of a certification, condition, or a denial.'' Id. at 42268.
This lack of clarity in the 2020 Rule led to stakeholder confusion and
misunderstanding about the nature of the Federal agency's review (e.g.,
assertions from both Federal agencies and states and Tribes in
implementation, pre-proposal input, and public comment that the review
was to be ``substantive'' in nature). Additionally, although the 2020
Rule limited Federal agency review to certain procedural components,
Federal agency stakeholders expressed concerns about being required by
the 2020 Rule to undertake even this responsibility.
Certifying authorities have expressed concern over the potential
consequences of Federal agency review required by the 2020 Rule. A few
commenters discussed their experience with the 2020 Rule and Federal
agency review, including specific examples where Federal agencies
deemed certification decisions waived. Most commenters who discussed
Federal agency review critiqued the 2020 Rule's approach and argued
that allowing, even requiring, Federal agencies to deem non-compliant
certification decisions waived was inconsistent with the CWA and
relevant case law (citing Sierra Club v. U.S. Army Corps of Engineers,
909 F.3d 635, 645 (4th Cir. 2018); United States v. Marathon Dev.
Corp., 867 F.2d 96, 101 (1st Cir. 1989)). A few commenters asserted
that the 2020 Rule provided Federal agencies with improper authority to
``veto'' or ``override'' certifying authorities' decisions under the
2020 Rule. As discussed below, EPA generally agrees with these
commenters. EPA continues to agree with the concerns it expressed in
its Notice of Intent to revise the 2020 Rule, stating that ``EPA is
concerned that a federal agency's review may result in a state or
tribe's certification or conditions being permanently waived as a
result of nonsubstantive and easily fixed procedural concerns
identified by the federal agency.'' 86 FR 29543 (June 2, 2021).
The following subsections discuss the extent of Federal agency
review, how certifying authorities might demonstrate compliance with
the facial requirements of section 401, and the Federal agency review
process under this final rule.
a. Extent of Federal Agency Review
The final rule confirms that Federal agencies may review a
certification decision only for the limited purpose of verifying
compliance with the requirements of CWA section 401. EPA
[[Page 66618]]
proposed at Sec. 121.9 that Federal agency review of a certification
decision is limited to confirming four factors: the nature of the
decision, that the proper certifying authority issued the decision,
that the certifying authority provided public notice on the request for
certification, and that the decision was issued in the reasonable
period of time. As discussed in more detail below, the Agency removed
the first factor (the nature of the decision) and modified the third
factor to clarify that Federal agency review is limited to verifying
that the certifying authority confirmed compliance with its public
notice procedures.
As a result, the final rule provides that Federal agencies may
verify (1) whether the appropriate certifying authority issued the
certification decision, (2) whether the certifying authority confirmed
it complied with its public notice procedures established pursuant to
section 401(a)(1), and (3) whether the certifying authority acted on
the request for certification within the reasonable period of time. 40
CFR 121.8. Federal agencies may find that a certifying authority waived
its ability to act on a request for certification only for failures to
act within the reasonable period of time. The Agency finds this Federal
agency review role is reasonable and consistent with the text of
section 401, prior Agency guidance, and case law.
A Federal agency's review of a certifying authority's action (to
ensure that the certification decision meets certain statutory
requirements) does not require a Federal agency to inquire as to
whether the certification is consistent with the substantive elements
of state or Tribal law concerning certification or whether the
certification action is within the proper ``scope of certification.''
As recognized by prior Agency guidance and the 2020 Rule, section 401
does not authorize Federal agencies to review or change the substance
of a certification (e.g., determine whether the certification or its
conditions are within section 401's scope). See 85 FR 42268; 2010
Handbook at 10 (rescinded in 2019, see supra). As discussed below, the
Agency has revised the proposed regulatory text to better emphasize the
limited extent of Federal agency review.
Several commenters noted that section 401 does not give Federal
agencies the authority to nullify or reject a certifying authority's
water quality certification or conditions. Some of these commenters
asserted that courts have affirmed that Federal agencies do not have
the authority to ignore conditions of certification. EPA agrees.
Federal circuit courts have routinely held that Federal agencies may
not question or criticize the substance of a state's water quality
certification or conditions, see, e.g., City of Tacoma, 460 F.3d at 67
(``[The Federal agency's] role is limited to awaiting, and then
deferring to, the initial decision of the state.''); American Rivers,
129 F.3d at 111 (``[The Federal agency] does not possess a roving
mandate to decide that substantive aspects of state-imposed conditions
are inconsistent with the terms of [section] 401.''); U.S. Dept. of
Interior v. FERC, 952 F.2d 538, 548 (D.C. Cir. 1992) (``FERC may not
alter or reject conditions imposed by the states through section 401
certificates.''). Courts have also cautioned Federal agencies against
imposing conditions in a Federal license or permit they believe are
more stringent than the certifying authority's conditions. See Sierra
Club v. U.S. Army Corps of Eng'rs, 909 F.3d 635, 648 (4th Cir. 2018)
(``the plain language of the Clean Water Act does not authorize the
Corps to replace a state condition with a meaningfully different
alternative condition, even if the Corps reasonably determines that the
alternative condition is more protective of water quality''); see also
Lake Carriers' Ass'n. v. EPA, 652 F.3d 1, 6, 12 (D.C. Cir. 2011)
(concluding that additional notice and comment on state certification
conditions would have been futile because ``the petitioners have failed
to establish that EPA can alter or reject state certification
conditions . . .'').
Rather, courts have generally found that Federal agencies may
review certification decisions only to see whether the decision
satisfies the facial statutory requirements of section 401, including
whether the decision was issued within the reasonable period of time,
whether public notice procedures were followed, and whether the
appropriate certifying authority issued the decision. The court in City
of Tacoma found that if the facial public notice requirement of section
401 is ``called into question'' before the Federal agency, the Federal
agency must determine if it was met. 460 F.3d at 68 (requiring the
Federal agency ``to obtain some minimal confirmation of such
compliance, at least in a case where compliance has been called into
question.'').
EPA proposed to expressly limit Federal agency review at Sec.
121.9 to confirming four factors: the nature of the decision, that the
proper certifying authority issued the decision, that the certifying
authority provided public notice on the request for certification, and
that the decision was issued in the reasonable period of time. Several
commenters agreed with limiting the 2020 Rule's breadth of Federal
agency review, with some of these commenters supporting all four of the
proposed review provisions. A few commenters wrote in favor of the
proposed rule's limited ``ministerial'' role for Federal agencies. EPA
agrees that Federal agency review is limited in nature. As discussed
below, the Agency is finalizing regulatory text at Sec. 121.8 to
affirmatively limit Federal agency review to verifying compliance with
the facial requirements of CWA section 401. However, the Agency is
revising the proposed list of factors that a Federal agency may review,
including removing the first factor (the nature of the decision) from
the final regulatory text.
Conversely, a few commenters recommended prohibiting Federal agency
review of any certification decisions in the final rule, with one
commenter arguing that Federal agency review erodes cooperative
federalism principles, and another noting that Federal agency review is
unwarranted by the statutory text. A few commenters noted that section
401 does not define a role for Federal agency review of certification
decisions. A couple of commenters argued that the additional oversight
provided by Federal agency review of certification decisions is
inefficient and ineffective for routine projects with minimal impacts.
EPA acknowledges that the text of section 401 does not explicitly
define a role for Federal licensing or permitting agencies to review
certification decisions. However, the Agency has long recognized, both
in regulation and guidance, some degree of appropriate Federal agency
review of certification decisions. Additionally, as discussed above, a
few courts have acknowledged a limited role for Federal agencies to
ensure that a certifying authority meets certain requirements of
section 401. The Agency disagrees that this final rule's approach to
Federal agency review would erode cooperative federalism principles or
prove inefficient for projects. Rather, the final rule recognizes a
Federal agency's legitimate interest in receiving a certification in
accordance with section 401 to lawfully proceed with its licensing and
permitting process.
On the other hand, other commenters wrote in support of the 2020
Rule's approach to Federal agency review, arguing that Federal agencies
are obligated to determine if procedural requirements have been met and
warned that without Federal oversight, certifying authorities would
have little incentive--and might be
[[Page 66619]]
disincentivized--to provide information supporting their certification
actions. A few commenters argued that the 2020 Rule's approach to
Federal agency review was a less costly and more efficient mechanism
than judicial review.
EPA declines to impose in this final rule a requirement that
Federal agencies review every certification decision for compliance
with the statutory requirements of section 401. EPA recognizes that the
preamble to the 2020 Rule indicated that Federal agency review is
mandatory in every instance. 85 FR 42267-69 (``the Agency has concluded
that under the final rule, federal agencies have an affirmative
obligation to review certifications to ensure that certifying
authorities have complied with procedural requirements and have
included the required information for certifications, conditions, and
denials . . .''). However, most case law on this topic focuses on the
extent of Federal agency review, not the issue of if or when section
401 imposes a duty on the Federal agency to confirm compliance. The
exception to courts not addressing this issue is City of Tacoma, where
the court found that if the public notice requirement of section 401 is
``called into question'' before the Federal agency, the agency must
determine if it was met. 460 F.3d at 68.\83\ This final rule does not
address what circumstances might compel a Federal agency to review
certification decisions, nor does it require Federal agencies to review
every certification decision. Instead, this final rule allows Federal
agencies to review specified aspects of a certification decision,
recognizing that Federal agencies have an interest in ensuring
certifications relating to their permits are facially compliant with
CWA section 401.
---------------------------------------------------------------------------
\83\ In Keating v. FERC, the court required FERC to consider the
application of section 401(a)(3) to a certifying authority's
purported revocation of a certification. 927 F.2d 616 (D.C. Cir.
1991) (``FERC must at least decide whether the state's assertion of
revocation satisfies section 401(a)(3)'s predicate requirements--
i.e., whether it is timely and motivated by some change in
circumstances after the certification was issued.'').
---------------------------------------------------------------------------
The Agency also disagrees with commenter assertions that the Agency
is removing Federal oversight. The Agency is still authorizing Federal
agencies to review much of what they could under the 2020 Rule. In
fact, the Agency is clarifying in regulatory text that Federal agency
review includes verification that the certifying authority confirmed
that it complied with its public notice procedures and that the correct
certifying authority acted on the request for certification (aspects
that were not directly addressed in the 2020 Rule). The one aspect of
the 2020 Rule that the Agency is removing is Federal agency review of
the procedural and informational requirements (e.g., citation
requirements) of the 2020 Rule (as opposed to the facial requirements
of section 401). The Agency disagrees with commenters who argued that
this will lead to a lack of supporting information in certification
decisions or create a structure for misuse. EPA encourages certifying
authorities to include supporting information with certification
decisions and is finalizing this recommendation at Sec. 121.7.
Furthermore, it is in the certifying authority's interest to include
such information to ensure project proponents and Federal agencies--not
to mention any court reviewing the certification decision--understand
why a condition is placed on a certification or why a certification is
being denied. See supra section IV.F of this preamble for further
discussion of the contents of a certification decision.
It is unclear why some commenters concluded that the 2020 Rule's
Federal agency review process would reduce litigation or create any
efficiencies when compared to direct judicial review. Those commenters
did not provide any data or information to substantiate a time or cost
differential between the 2020 Rule's Federal agency review process and
any possible judicial review associated with certification decision.
Nothing about the 2020 Rule's approach to Federal agency review removed
or reduced the opportunity or potential for judicial review on a
certification decision. In fact, the 2020 Rule's mandate that Federal
agencies review for compliance with the rule's own procedural and
informational requirements (e.g., citation requirements) added another
possible avenue for judicial review. Federal courts could be called
upon to decide whether a Federal agency properly found that a
certifying authority waived certification for its failure to fully
comply with the 2020 Rule's informational requirements. In fact, one
such case was recently filed in the D.C. Circuit Court of Appeals.
Brookfield White Pine Hydro LLC v. FERC, No. 23-1075 (D.C. Cir.)
(petition for review filed March 20, 2023, regarding FERC determination
that a denial of certification satisfied the procedural requirements of
the 2020 Rule).
Furthermore, Federal agency review of the substance of
certification decisions in lieu of judicial review is inconsistent with
the legislative history of section 401. Indeed, Congress recognized
that state courts were the proper venue for any issues or concerns
surrounding the substance of a certification decision. See, e.g., H.R.
Rep. No. 91-940, at 55-56 (March 24, 1970) (``If a State refuses to
give a certification, the courts of that State are the forum in which
the applicant must challenge that refusal if the applicant wishes to do
so.''); S. Rep. 92-414, at 1487 (October 28, 1971) (``Should such an
affirmative denial occur no license or permit could be issued by such
Federal agencies as the Atomic Energy Commission, Federal Power
Commission, or the Corps of Engineers unless the State action was
overturned in the appropriate courts of jurisdiction.''); H.R. Rep. 92-
911, at 122 (March 11, 1972) (``If a State refuses to give a
certification, the courts of that State are the forum in which the
applicant must challenge the refusal if the applicant wishes to do
so.'').
The Agency is finalizing regulatory text substantively similar to
proposed Sec. 121.9(a)(2) that allows a Federal agency to verify
whether the appropriate certifying authority--meaning the entity
responsible for certifying compliance with applicable water quality
requirements where the discharge originates or will originate--issued
the certification decision. 40 CFR 121.8. EPA made one non-substantive
change to proposed text to verify whether the ``appropriate'', as
opposed to ``proper'', certifying authority issued the certification
decision. Section 401 requires a project proponent to provide the
Federal licensing or permitting agency a certification from the state
or authorized Tribe ``in which the discharge originates or will
originate.'' 33 U.S.C. 1341(a)(1). If the project proponent provides
the Federal agency with a certification from the wrong certifying
authority, then the Federal agency cannot issue its license or permit.
Allowing a Federal agency to confirm that the appropriate certifying
authority has issued certification is consistent with case law,
American Rivers, 129 F.3d at 110-11, and prior Agency regulations and
guidance, 85 FR 42267; 2010 Handbook at 10 (rescinded in 2019, see
supra).
The Agency is finalizing regulatory text that allows a Federal
agency to verify that the certifying authority confirmed it complied
with its public notice procedures established pursuant to section
401(a)(1). 40 CFR 121.8. EPA proposed that a Federal agency may review
a certification decision to determine whether the certifying authority
``provided public notice'' on the request for certification at Sec.
121.9(a)(3). Some commenters noted
[[Page 66620]]
that public notice procedures vary amongst certifying authorities,
including one commenter that noted that establishing generally
applicable procedures for public notice is not necessarily the same as
providing public notice on every application. EPA agrees with these
commenters. Section 401(a)(1) requires a certifying authority to
establish procedures for public notice, and a public hearing where
necessary, on a request for certification. 33 U.S.C. 1341(a)(1).
Accordingly, EPA has revised the regulatory text, now located at Sec.
121.8, to better reflect the statutory text and to clarify that a
Federal agency may review whether the certifying authority confirmed it
complied with its public notice procedures.
One commenter stated that Federal agencies have little knowledge of
the public notice procedures of certifying authorities, and that any
issues with the procedural process would be addressed in state court.
While EPA agrees that questions regarding compliance with specific
state public notice laws and regulations would be addressed in state
proceedings, EPA disagrees that it is therefore inappropriate for a
Federal agency to seek verification from the certifying authority that
it complied with its public notice procedures, a Federal statutory
requirement. The Agency appreciates commenter concerns regarding a
Federal agency's lack of substantive knowledge about a certifying
authority's public notice procedures. Therefore, the Agency is limiting
Federal agency review regarding public notice to simply verifying that
the certifying authority confirmed it complied with its public notice
procedures. This should not require the Federal agency to delve into
any specifics regarding a state or authorized Tribe's public notice
procedures, but rather should entail merely asking the certifying
authority to provide confirmation of its compliance. To aid in this
review, EPA recommends that certifying authorities indicate compliance
with their public notice procedures in its certification decision. See
section IV.F of this preamble for further discussion on ways a
certifying authority can indicate its compliance; see also infra.
The Agency is also finalizing regulatory text substantively similar
to proposed Sec. 121.9(a)(4) that allows a Federal agency to verify
whether a certifying authority acted on a request for certification
within the reasonable period of time. 40 CFR 121.8. Section 401
provides that certification ``shall be waived'' if the certifying
authority fails or refuses to act within the reasonable period of time.
A Federal agency cannot issue its license or permit until certification
``has been obtained or has been waived.'' 33 U.S.C. 1341(a)(1). It is
thus reasonable for the Federal agency to determine whether a
certifying authority acted within the reasonable period of time, and
this has been the Agency's longstanding position in regulation and
guidance. See 40 CFR 121.16(b) (2019); 85 FR 42267; 2010 Handbook at 10
(rescinded in 2019, see supra). Additionally, as discussed above, this
is also consistent with case law on Federal agency review. See American
Rivers, 129 F.3d at 110-11 (explaining that FERC ``may determine . . .
whether a state has issued a certification within the prescribed
period''); see also Alcoa Power Generating, 643 F.3d at 972-73 (holding
that, like the public notice requirements at issue in City of Tacoma,
the issue of whether a certifying authority acted upon a certification
request within the statutory one-year period was an issue properly
before FERC).
The Agency is not finalizing the regulatory text proposed at Sec.
121.9(a)(1), which provided that a Federal agency may also review a
certification decision to confirm the nature of the decision (i.e.,
whether the certification decision is a grant, grant with conditions,
denial, or express waiver). The Agency does not disagree with this
aspect of the proposal, but the Agency finds the regulatory text
unnecessary and somewhat confusing when listed among the other
components of Federal agency review. Certainly, a Federal agency needs
to look at the certification decision to determine how it should act in
response. For instance, the Federal agency cannot issue the relevant
license or permit if the certification decision is a denial. If the
decision is a grant with conditions, the Federal agency must include
those conditions in its license or permit. However, looking at the
certification document to see how the certifying authority decided to
act represents a different sort of ``review'' than the other components
of Federal agency review identified in Sec. 121.8. The other
components all concern verifying compliance with the statutory
requirements of section 401. EPA concludes that it is best to remove
this provision to avoid confusion. Further, as one commenter noted, the
decision should generally be apparent on its face. Certifying
authorities and Federal agencies have over 50 years of experience with
developing and receiving certification decisions, respectively.
Additionally, the Agency is finalizing regulatory text at Sec.
121.7(a) that clearly defines the four possible ways a certifying
authority may act on a request for certification, as well as regulatory
text at Sec. 121.7(c) through (f) that clearly outlines recommended
contents for a certification decision. These final rule provisions
should provide certifying authorities with sufficient clarity regarding
possible actions they may take and how to develop clear certification
decisions.
b. Demonstrating Compliance With the Facial Requirements of Section 401
Consistent with the proposed rule, EPA is declining to define the
specific information a certifying authority must include in a
certification decision to demonstrate compliance with the facial
requirements of section 401. Section 401 does not expressly address
what specific information certifying authorities must include in a
certification decision, nor does it address the process of Federal
agency review. While the statute does contain important information
about the identity of the appropriate certifying authority, the length
of the reasonable period of time, and a requirement for public notice
procedures, it does not prescribe how a certifying authority must
demonstrate compliance with those requirements.
At proposal, EPA did not define the specific information a
certifying authority must include in its certification decision to
demonstrate that it has met the facial requirements of section 401.
However, EPA requested comment on whether the Agency should identify in
regulation different elements of a certification decision that might be
appropriate for Federal agency review, or whether EPA should defer to
Federal agencies to define those elements.
In the final rule, the Agency is declining to define the specific
information a certifying authority must include in a certification
decision to demonstrate that it has met the facial requirements of
section 401. Certifying authorities are the entities most familiar with
their certification process, and certifying authorities, and not EPA or
other Federal agencies, are in the best position to determine how to
demonstrate compliance. EPA expects that it should only take minimal
effort by a certifying authority to demonstrate compliance for Federal
agency verification. However, as discussed below, the Agency is
providing recommendations for how certifying authorities can
demonstrate compliance with these requirements.
To support a streamlined review of whether a certifying authority
complied with its public notice procedures, EPA is finalizing a
recommendation for a
[[Page 66621]]
certifying authority to indicate such compliance in its certification
decision.\84\ By doing so, the Federal agency should be able to simply
look at the certification decision and quickly and easily determine
whether the certifying authority indicated that it followed its public
notice procedures.
---------------------------------------------------------------------------
\84\ See section IV.F of this preamble regarding contents of
certification decisions.
---------------------------------------------------------------------------
A few commenters discussed how certifying authorities currently, or
could, demonstrate compliance with their public notice procedures,
including providing a copy of the public notice in the certification
decision or including a description of the public notice process it
undertook in its certification decision. EPA finds that these and other
approaches to demonstrating compliance with public notice procedures
would be sufficient to satisfy Federal agency review. In fact, it would
be sufficient for the certifying authority to simply state in its
certification decision that the certifying authority complied with its
public notice procedures. This inquiry does not require the Federal
agency to research or inquire about the particulars of a state or
Tribal laws and regulations regarding public notice, but rather merely
verify that the certifying authority confirmed it complied with its
public notice procedures. EPA is not defining how a certifying
authority must communicate such confirmation, but EPA does not
anticipate that such demonstrations will be burdensome. As the court
noted in City of Tacoma, Federal agencies only need ``to obtain some
minimal confirmation of such compliance.'' 460 F.3d at 68.
The Agency is also not defining how a certifying authority must
demonstrate that it provided a certification decision within the
reasonable period of time. However, EPA finds that other provisions in
this final rule should aid in making such a demonstration. For example,
final rule Sec. 121.6(a) requires a certifying authority to send the
project proponent and the Federal agency a written confirmation of the
date that the request for certification was received, while Sec.
121.6(b) requires the Federal agency and certifying authority to
jointly agree on the reasonable period of time in writing. Using this
documentation, the Federal agency should be able to verify whether the
certifying authority acted on the request for certification within the
reasonable period of time. If the Federal agency needs further
information to verify that the certification decision was issued within
the reasonable period of time, the certifying authority could satisfy
this inquiry by providing documentation of the date it furnished the
project proponent with a decision.
The Agency is also not defining how to demonstrate that the
certification is from the appropriate certifying authority, meaning the
state or authorized Tribe responsible for certifying compliance with
applicable water quality requirements where the discharge originates or
will originate.\85\ EPA finds that the project proponent bears the
burden of demonstrating that it has obtained a certification from the
appropriate certifying authority. See 33 U.S.C. 1341(a)(1) (``Any
applicant . . . shall provide the licensing or permitting agency a
certification from the State in which the discharge originates or will
originate . . .''). Accordingly, if a Federal agency chooses to verify
that the appropriate certifying authority issued the certification
decision, it should work with the project proponent to obtain location
information, such as a map, indicating where the discharge originates
or will originate. The Federal agency and project proponent may also
discuss any questions regarding jurisdiction with the certifying
authority, or as needed, EPA in its technical assistance capacity under
section 401(b).
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\85\ But see section IV.H of this preamble for further
discussion on instances where EPA acts as the certifying authority
instead of a state or authorized Tribe.
---------------------------------------------------------------------------
c. Federal Agency Review Process
Consistent with the 1971 Rule and 2020 Rule, the Agency is
finalizing regulatory text to reaffirm that a waiver of certification
occurs only if the certifying authority fails to act within the
reasonable period of time. See 40 CFR 121.9(a)(2)(i) (2020); 40 CFR
121.16(b) (2019). If the Federal agency reviews for timeliness and
determines that the reasonable period of time has passed without the
certifying authority acting on the request for certification, then the
Federal agency may determine that a constructive waiver has occurred.
40 CFR 121.9(b). Similar to the approach in the 2020 Rule, the Agency
is finalizing regulatory text describing how the Federal agency must
communicate its waiver determination to the project proponent and
certifying authority. See id. Specifically, if a Federal agency
determines that the certification decision was not issued within the
reasonable period of time, the Federal agency shall promptly notify the
certifying authority and project proponent in writing that a waiver has
occurred. Id. Similar to the 2020 Rule, see Sec. 121.9(b) of the 2020
Rule, the Agency is also finalizing regulatory text that clarifies that
such notification from the Federal agency satisfies the project
proponent's requirement to obtain certification. 40 CFR 121.9(b). The
Agency made minor revisions to the text proposed at Sec. 121.9(c) to
clarify that a waiver only satisfies the project proponent's obligation
to obtain a certification and does not satisfy any other obligations
under section 401 (e.g., need to provide the Federal agency
supplemental information pursuant to Sec. 121.12). However, as
discussed in more detail below, the Agency is declining to finalize
regulatory text on the process that Federal agencies and certifying
authorities must follow for non-compliance with other facial
requirements of CWA section 401 including potential consequences and
remedy procedures. This is consistent with the Agency's approach to
Federal agency review prior to the 2020 Rule and avoids unnecessarily
encumbering the certification process with additional procedures.
Many commenters agreed with the proposal's characterization of
constructive waiver as a ``severe consequence.'' Some commenters
expressed support for the position in the proposal that constructive
waiver may only occur when the certifying authority fails or refuses to
act (i.e., to grant, grant with conditions, deny, or expressly waive)
within the reasonable period of time. A few commenters stated that
procedural technicalities should not be a basis for an involuntary or
implicit waiver of certification.
EPA agrees with commenters that a constructive waiver occurs only
where a certifying authority fails to act on a request for
certification (i.e., grant, deny, expressly waive) within the
reasonable period of time. The Agency recognizes that a constructive
waiver is a severe consequence; as discussed in section IV.F in this
preamble, a waiver means that a Federal license or permit which could
adversely impact the certifying authority's water quality (i.e., cause
noncompliance with water quality requirements) may proceed without any
input from the certifying authority. EPA encourages Federal agencies,
project proponents, and certifying authorities to communicate early and
often to prevent inadvertent waivers due to passage of time. For
example, a Federal agency could set up an MOA or other agreement with
certifying authorities to establish notification protocols prior to
finding a waiver of certification (e.g., where a certifying authority
has not acted by 30 days prior to the end of the reasonable period of
time, the Federal agency will notify the certifying
[[Page 66622]]
authority that a waiver will occur if it does not receive a
certification decision or a request to extend the reasonable period of
time in that 30 day period).\86\
---------------------------------------------------------------------------
\86\ Nothing in section 401 precludes a Federal licensing or
permitting agency from considering input provided by a state or
authorized Tribe in a late certification decision. But that
consideration would occur outside the context of section 401 and
would be akin to consideration of input provided by the state or
Tribe in any other context (e.g., a public comment period). For
example, if a certifying authority included conditions in a late
certification, nothing in section 401 precludes the Federal
licensing or permitting agency from considering including similar
conditions in its Federal license or permit, even though section 401
would not compel the Federal agency to do so.
---------------------------------------------------------------------------
A couple of commenters suggested that EPA require the Federal
agency to extend the reasonable period of time in instances where the
certifying authority failed to act and extending the reasonable period
of time would not exceed the one-year statutory time period from
receipt of the request for certification. These commenters asserted
that allowing constructive waiver before one year would be inconsistent
with cooperative federalism principles, and one of these commenters
asserted that section 401(a)(1) prohibited a finding of a constructive
waiver until after one year. Conversely, one commenter expressed
concern over the proposal's preamble language encouraging Federal
agencies to extend the reasonable period of time where a certifying
authority inadvertently waives certification, asserting that section
401 clearly provides that if a reasonable period of time is established
and the certifying authority does not act within that reasonable period
of time then waiver has occurred, and EPA cannot create a regulatory
override over clear statutory language.
Aside from providing that a waiver occurs if the certifying
authority does not act within the reasonable period of time, the
statute does not provide direction on what should occur if a certifying
authority fails to meet the other statutory requirements in section
401. As discussed earlier, the legislative history indicates that
Congress added the waiver provision to prevent ``sheer inactivity'' by
a certifying authority from holding up the licensing or permitting
process. See H.R. Rep. No. 91-940, at 54-55 (March 24, 1970) (Conf.
Report). Consistent with the statutory language and legislative
history, EPA believes that Congress intended such an extreme outcome
only in situations where certifying authorities fail or refuse to make
a decision, and not where a certifying authority, otherwise attempting
to make a timely decision, fails to comply with other requirements of
section 401. Case law also provides support for the Federal agency
allowing the certifying authority to either demonstrate that its
decision meets section 401's requirements or remedy the situation, as
opposed to the Federal agency having authority to deem any failure an
automatic waiver of certification. See City of Tacoma, 460 F.3d at 68-
69 (``FERC should seek an affirmation from Ecology that it complied
with state law notice requirements when it issued its water quality
certification or, if it did not, that it has done so in response to
this decision.'').
The Agency is declining to define the process that a Federal agency
and certifying authority must follow if the Federal agency's review
reveals that the wrong certifying authority issued the certification
decision, or the Federal agency was unable to obtain confirmation that
the certifying authority complied with its public notice procedures.
Most commenters providing input on this topic expressed support for
proposed Sec. 121.9(b) that if the Federal licensing or permitting
agency determines that certain statutory requirements (e.g., public
notice) have not been met, it must provide the certifying authority
with an opportunity to remedy the situation. However, a few commenters
expressed concern with the proposed automatic extensions for certifying
authorities that failed to comply with public notice procedures,
suggesting that it might incentivize certifying authorities to ignore
procedures and improperly extend the time for certification. Upon
further reconsideration, the Agency is declining to include regulatory
text addressing the potential consequences and remedies to deficient
certification decisions, aside from failure or refusal to act within
the reasonable period of time. As discussed in further detail below,
this restores the Agency's pre-2020 Rule approach to Federal agency
review and avoids unnecessarily encumbering the certification process
with more procedure.
The Agency proposed at Sec. 121.9(b) that if a Federal agency
determines that a section 401 certification decision does not clearly
indicate whether it is a grant, grant with conditions, denial, or
express waiver, the Federal agency must notify the certifying authority
of the deficiency and provide the certifying authority with an
opportunity to remedy it. As discussed above, the Agency is not
finalizing regulatory text regarding Federal agency review of the
nature of the certification decision, so the proposed text regarding
next steps is no longer needed.
The Agency did not propose any regulatory text explicitly
discussing the consequences or next steps where Federal agency review
reveals that the wrong certifying authority provided the certification
decision. However, the proposed rule preamble provided that if Federal
agency discovers that the wrong certifying authority issued the
certification, then the Federal agency should notify the project
proponent that it must seek certification from the appropriate
certifying authority before the Federal license or permit may be
issued. The Agency is not including regulatory text regarding next
steps for this aspect of Federal agency review, but continues to
encourage the Federal agency to promptly notify the project proponent
where the Federal agency determines that the certification decision was
not issued by the appropriate certifying authority. As noted above,
section 401 requires a project proponent to seek certification from the
jurisdiction in which the discharge originates or will originate. 33
U.S.C. 1341(a)(1). Therefore, it is incumbent on the project proponent
to identify and obtain certification (or waiver) from the proper
certifying authority--the entity responsible for certifying compliance
with applicable water quality requirements where the discharge
originates or will originate--before it can obtain a Federal license or
permit. See 40 CFR 121.1(b).
The Agency is not finalizing the process proposed at Sec. 121.9(b)
for the Federal agency to follow if it is unable to obtain confirmation
from the certifying authority that the certifying authority complied
with its public notice procedures. The Agency proposed that the Federal
agency must notify the certifying authority if it determined that the
certifying authority did not provide public notice on the request for
certification and provide the certifying authority with an opportunity
to remedy the noted deficiency. 87 FR 35357. The proposal further
provided that, if necessary, the Federal agency must extend the
reasonable period of time to provide the certifying authority with an
opportunity to remedy the deficiency, but the reasonable period of time
may not exceed one year from the receipt of the certification request.
Id.
Most commenters providing input on this aspect of the proposed rule
expressed support for Federal agencies extending the reasonable period
of time to allow for correction of deficiencies up to the statutory
one-year limit. A few commenters suggested that the final rule should
allow certifying authorities to
[[Page 66623]]
correct errors even after the reasonable period of time has ended,
including one commenter who suggested it should extend beyond the one-
year timeframe. Conversely, one commenter urged EPA to reconsider
requiring automatic extensions of the reasonable period of time as
necessary to allow the certifying authority with an opportunity to
remedy any deficiency. The commenter explained that it does not oppose
small extensions of time for certifying authorities to provide
additional detail or make minor changes necessary to satisfy the
elements. However, the commenter expressed concern that certifying
authorities may abuse this extension process by submitting purposely
incomplete decisions. According to the commenter, if a certifying
authority submits a clearly deficient certification decision, the
certifying authority should not be entitled to more time; instead, the
certification should be waived. Another commenter suggested that
corrections should be made within the reasonable period of time and be
limited to ``errors made in good faith.'' This commenter cautioned that
this provision should not allow or incentivize certifying authorities
to ignore procedures or take more time.
The Agency is declining to define any specific process to remedy
any deficiencies identified through Federal agency review. As an
initial matter, the Agency did not provide a regulatory process for
Federal agency review prior to the 2020 Rule (aside from failure or
refusal to act within the reasonable period of time). Rather, prior EPA
guidance merely acknowledged that the Federal licensing or permitting
agency may review the procedural requirements of a certification
decision. See 2010 Handbook at 32 (rescinded in 2019, see supra) (``For
example, the federal permitting or licensing authority may review the
procedural requirements of [section] 401 certification, including
whether the proper state or tribe has certified, whether the state or
tribe complied with applicable public notice requirements, and whether
the certification decision was timely.'') (citing American Rivers, 129
F.3d at 110-111; City of Tacoma v. FERC, 460 F.3d 53, 68 (D.C. Cir.
2006)). The Agency is not aware of any issues, procedural or otherwise,
with Federal agencies and certifying authorities managing this process
pre-2020 Rule. Because this final rule returns the Agency to its pre-
2020 Rule posture on Federal agency review, the Agency is accordingly
declining to define a process to address deficiencies identified
through Federal agency review. The Agency expects this will provide
certifying authorities and Federal agencies with the flexibility to
address such procedural deficiencies in accordance with pre-2020 Rule
practices.
The Agency emphasizes that other aspects of this final rule should
prevent the need for specific EPA-mandated process to remedy
deficiencies identified through Federal agency review. First, as
discussed in section IV.D of this preamble, certifying authorities have
an active role in setting the reasonable period of time with the
Federal agency. See 40 CFR 121.6(b). This approach provides certifying
authorities with an opportunity to ensure the length of the reasonable
period of time considers their specific timing needs and concerns.
Second, the final rule provides certifying authorities and Federal
agencies with the ability to extend the reasonable period of time as
needed, or automatically in limited cases. See 40 CFR 121.6(d) and (e).
Together, these components of the final rule should provide certifying
authorities with ample opportunities to ensure they have the
appropriate amount of time to act on a request for certification and
comply with the facial components of section 401. EPA notes that its
proposed automatic extensions for curing deficiencies (at proposed
Sec. 121.9(b)) would have applied only for failure to indicate the
nature of the decision and failure to provide public notice. In this
final rule, EPA has removed Federal agency review of the nature of the
decision and expressly limited review of public notice to simply
verifying that the certifying authority confirmed that it complied with
its public notice procedures. Additionally, as discussed in section
IV.F of this preamble, the Agency encourages certifying authorities to
include an indication that they complied with their public notice
procedures established in all certification decisions. This serves two
purposes. First, it ensures the certifying authority remains cognizant
of satisfying all statutory requirements in section 401, including the
need to establish and comply with public notice procedures. Second, it
clearly communicates the certifying authority's compliance with this
requirement of section 401 so that in the event the Federal agency
chooses to review for such compliance it may easily determine that the
certifying authority confirmed compliance with its public notice
procedures.
3. Implementation
As discussed throughout this preamble, EPA emphasizes the
importance of communication between certifying authorities, Federal
agencies, and project proponents early and often through the
certification process. Consistent communication can ensure that
stakeholders develop a common understanding around timing and
information needs to complete the certification process and comply with
the facial requirements of section 401. Ideally, such communication
minimizes the need for Federal agency review. However, in the event a
Federal agency reviews a certifying authority's action, it is limited
to reviewing whether the action complies with the requirements of
section 401 as explicitly defined at final rule Sec. 121.8. Federal
agency review does not require, nor allow, a Federal agency to review
the substance of a certification decision or specific certification
condition (e.g., determine whether the certification or its conditions
is within the scope of section 401).
In the proposal, EPA requested comment on whether the Agency should
develop procedures regarding how a certifying authority should respond
to a Federal agency's notice regarding deficiencies in its
certification decision. Several commenters provided various
recommendations on the procedural aspects of the Federal agency review
process, including recommending that the final rule should require the
Federal agency to immediately notify the certifying authority after a
deficiency was identified, recommending that Federal agencies develop
procedures providing how a certifying authority should respond to a
Federal agency's notice regarding deficiencies, and suggesting that the
final rule include a requirement that the Federal agency notify the
certifying authority that the certification has been received within
the reasonable period of time, and the certification conditions have
been incorporated into the relevant Federal license or permit.
Under this final rule, if the Federal agency determines that the
certifying authority did not act on a request for certification within
the reasonable period of time, then the final rule requires the Federal
agency to promptly notify the certifying authority and project
proponent in writing that the certification requirement has been
waived. 40 CFR 121.9(b). This final rule does not require a Federal
agency to notify the certifying authority an impending deadline to act
on a certification request prior to finding
[[Page 66624]]
waiver for failing or refusing to act. Certifying authorities are
ultimately responsible for managing resources and ensuring that they
act on a request for certification within the reasonable period of
time. However, the Agency encourages Federal agencies to reach out to
certifying authorities to remind them of impending deadlines to act
prior to finding constructive waiver, or setting up MOAs or other
agreements to establish notification protocols prior to finding a
waiver of certification.
EPA encourages Federal agencies to promptly notify certifying
authorities if they are seeking confirmation of certifying authority
compliance with public notice procedures, and to promptly notify
project proponents if they determine the certification decision was not
issued by the appropriate certifying authority. In either event, the
final rule does not define the contents of such notification, but EPA
encourages Federal agencies to provide notification in writing so the
certifying authority and/or project proponent can respond accordingly.
EPA does not find it necessary to impose a regulatory requirement
for the Federal agency to notify the certifying authority that the
certification has been received within the reasonable period of time,
and that the certification conditions have been incorporated into the
relevant Federal license or permit. As discussed above, Federal agency
review is not a mandatory requirement under this final rule. The
certifying authority should know whether it has issued its decision in
the reasonable period of time due to its involvement in setting the
reasonable period of time. As long as the certifying authority provides
its certification decision within the reasonable period of time, the
Federal licensing or permitting agency is required to incorporate any
certification conditions into its license or permit. See 33 U.S.C
1341(d).
H. EPA's Roles Under Section 401
1. What is the Agency finalizing?
Under section 401, EPA serves three different roles. First, EPA
acts as the certifying authority on behalf of states or Tribes that do
not have ``authority to give such certification.'' 33 U.S.C.
1341(a)(1). Second, EPA is also responsible for providing technical
assistance upon request from Federal agencies, certifying authorities,
or Federal license or permit applicants. Id. at 1341(b). Lastly, EPA is
responsible for notifying other states or authorized Tribes that may be
affected by a discharge from a federally licensed or permitted
activity, and where required, for providing an evaluation and
recommendations on such notified state or authorized Tribe's
objections. Id. at 1341(a)(2). This section focuses on EPA's role as a
certifying authority and in providing technical assistance. The
Agency's third role under section 401(a)(2), or the neighboring
jurisdictions process, is discussed in section IV.K in this preamble.
Consistent with the proposal, the Agency is finalizing revisions to
the regulatory text at Sec. Sec. 121.16 and 121.17 to clarify EPA's
process when it acts as the certifying authority, such as updating its
public notice and hearing provisions. More specifically, the Agency is
finalizing that when EPA is the certifying authority, it must provide
public notice within 20 days of the date the request for certification
is received. 40 CFR 121.17(a). The final rule also states that when EPA
acts as the certifying authority, it is subject to the same
requirements as other certifying authorities. EPA is also finalizing
the regulatory text on EPA's technical assistance role at Sec. 121.18
which reflects the statutory text at section 401(b) more directly.
2. Summary of Final Rule Rationale and Public Comment
a. EPA's Role as a Certifying Authority
EPA is finalizing revisions to the part 121 regulations to provide
greater clarity about EPA's process when it acts as the certifying
authority. Pursuant to section 401 of the CWA, EPA acts as the
certifying authority on behalf of states or Tribes that do not have
``authority to give such certification.'' 33 U.S.C. 1341(a)(1). The
1971 Rule required EPA to provide certification in two scenarios:
first, where EPA promulgated standards pursuant to section 10(c)(2) of
the 1970 Water Quality Improvement Act; and second, where water quality
standards had been established, but no state or interstate agency had
authority to provide certification. 40 CFR 121.21 (2019). As discussed
in section III in this preamble, the 1971 Rule was promulgated prior to
the enactment of the 1972 CWA amendments; as a result, the language in
the 1971 Rule regarding EPA as a certifying authority did not reflect
the amended text of section 401. In the 2020 Rule, EPA updated this
provision with new regulatory text that indicated that EPA provides
certification consistent with the 1972 statutory text and noted that
EPA was required to comply with part 121 when it acted as a certifying
authority. 40 CFR 121.13 (2020).
EPA is finalizing minor, conforming modifications to Sec.
121.13(a) and (b) of the 2020 Rule. Specifically, consistent with the
language in section 401(a)(1), the Agency is reaffirming that EPA is
required to provide certification or waiver where no state, Tribe, or
interstate agency has the authority to provide certification. 40 CFR
121.16(a). The Agency is also reaffirming that, when it acts as a
certifying authority, EPA must comply with both section 401 and the
requirements in part 121. See 40 CFR 121.16(b).
Currently, EPA acts as the certifying authority in two scenarios:
(1) on behalf of Tribes without ``treatment in a similar manner as a
state'' (TAS) and (2) on lands of exclusive Federal jurisdiction in
relevant respects. In the first scenario, if a Tribe does not obtain
TAS for section 401, EPA acts as the certifying authority for any
federally licensed or permitted activity that may result in any
discharge that originates in Indian country lands. As discussed in
section IV.L in this preamble, a Tribe may obtain TAS for section 401
for the purpose of issuing water quality certifications. When EPA
certifies on behalf of Tribes without TAS, its actions as a certifying
authority are informed by its Tribal policies and the Federal trust
responsibility to federally recognized Tribes. EPA's 1984 Indian
Policy, recently reaffirmed by EPA Administrator Regan, recognizes the
importance of coordinating and working with Tribes when EPA makes
decisions and manages environmental programs that affect Indian
country. See EPA Policy for the Administration of Environmental
Programs on Indian Reservations (November 8, 1984), available at
https://www.epa.gov/sites/default/files/2015-04/documents/indian-policy-84.pdf; see also Memorandum from Michael S. Regan to All EPA
Employees, Reaffirmation of the U.S. Environmental Protection Agency's
Indian Policy (September 30, 2021), available at https://www.epa.gov/system/files/documents/2021-09/oita-21-000-6427.pdf. This includes
coordinating and working with Tribes on whose behalf EPA reviews and
acts upon requests for certification on federally licensed or permitted
projects.
In the second scenario, EPA acts as the certifying authority in
situations where any discharge from any activity subject to section 401
certification originates where the Federal Government has exclusive
jurisdiction in relevant respects. Some commenters said they had
concerns with EPA acting as the certifying authority for all national
parks. One commenter more broadly argued that section 401 does not
authorize EPA to issue certifications for lands subject to exclusive
Federal
[[Page 66625]]
jurisdiction and that it would be contrary to the statutory language
and intent for EPA to act as a certifying authority over such lands.
This commenter asserted that this approach would remove authority from
states to protect water quality under section 401 in large areas within
their borders.
As an initial matter, EPA wishes to emphasize that not all Federal
lands or national parks are lands of exclusive Federal jurisdiction.
Rather, exclusive Federal jurisdiction is established only under
limited circumstances pursuant to the Enclave Clause of the U.S.
Constitution, article 1, section 8, clause 17. These circumstances
include (1) where the Federal Government purchases land with state
consent to jurisdiction, consistent with article 1, section 8, clause
17 of the U.S. Constitution; (2) where a state chooses to cede
jurisdiction to the Federal Government; and (3) where the Federal
Government reserved jurisdiction upon granting statehood. See Paul v.
United States, 371 U.S. 245, 263-65 (1963); Collins v. Yosemite Park
Co., 304 U.S. 518, 529-30 (1938); James v. Dravo Contracting Co., 302
U.S. 134, 141-42 (1937); Surplus Trading Company v. Cook, 281 U.S. 647,
650-52 (1930); Fort Leavenworth Railroad Company v. Lowe, 114 U.S. 525,
527 (1895).
EPA disagrees with the commenter asserting that section 401 does
not authorize EPA to issue certifications for lands subject to
exclusive Federal jurisdiction in relevant respects and that it would
be contrary to the statutory language and intent for EPA to act as a
certifying authority over such lands. Section 401(a)(1) specifically
anticipates circumstances in which no state or interstate agency has
authority to provide certification, directing that ``[i]n any such case
where a State or interstate agency has no authority to give such a
certification, such certification shall be from the Administrator.'' 33
U.S.C. 1341(a)(1) (emphasis added). Lands of exclusive Federal
jurisdiction in relevant respects present a case where states lack
authority for certification pursuant to section 401, as states lack
legislative jurisdiction in these areas absent specific congressional
action. See Paul, 371 U.S. at 263 (finding precedent establishes ``that
the grant of `exclusive' legislative power to Congress over enclaves
that meet the requirements of Art. I, s 8, cl. 17, by its own weight,
bars state regulation without specific congressional action.''). In
section 401, Congress did not take specific action to grant authority
to states to issue certification over lands of exclusive jurisdiction.
On the contrary, Congress provided in section 401(a)(1) that the EPA
Administrator shall issue certification ``in any such case'' where no
state or interstate agency has authority to give certification, and
otherwise recognized the Administrator as a certifying authority. In
addition to the statutory text, the legislative history further
supports that Congress did not grant authority to states to issue
certification where states otherwise lack authority, such as lands of
exclusive Federal jurisdiction in relevant respects. See 116 Cong. Rep.
9316, 9328 (March 25, 1970) (statement of Rep. Harsha) (emphasis added)
(``Another area of great complexity is that covered by section 21--
certification by the States to Federal agencies in cases where
application has been made for Federal licenses or permits. That
certification must come from the States unless, of course, the waters
involved are under the direct supervision of the Federal Government or
there is no State certifying authority.''). As a result, EPA finds that
section 401 directs the Administrator to issue certification in lands
of exclusive Federal jurisdiction in relevant respects. The Agency
further disagrees that the Administrator issuing certification for
lands of exclusive Federal jurisdiction in relevant respects removes
authority from states, as states under section 401 and the U.S.
Constitution do not have a jurisdictional basis providing authority to
issue certification for lands of exclusive Federal jurisdiction in
relevant respects.
Under this final rule, consistent with the 2020 Rule, when EPA acts
as the certifying authority, it is subject to the same requirements as
other certifying authorities (e.g., reasonable period of time to act on
a request for certification) under section 401 and 40 CFR part 121. In
contrast to the 2020 Rule, this final rule does not retain the request
for additional information provisions included in Sec. 121.14 of the
2020 Rule when EPA is the certifying authority. EPA proposed to remove
Sec. 121.14 of the 2020 Rule which introduced limits on EPA's ability,
as a certifying authority, to request additional information from a
project proponent once the reasonable period of time began. See 87 FR
35359 (June 9, 2022). These provisions included a requirement that EPA
must initially request additional information within 30 days of
receiving a request for certification and limitations on the type and
scope of additional information EPA may request. 40 CFR 121.14(a)
through (c) (2020). Additionally, the 2020 Rule required EPA to provide
the project proponent with a deadline to respond to requests for
additional information and acknowledged that a project proponent's
failure to provide additional information would neither extend the
reasonable period of time, nor prevent EPA from acting on the request
for certification. Id. at Sec. 121.14(d) and (e).
Consistent with the proposal, EPA is removing Sec. 121.14 of the
2020 Rule in its entirety because it finds these provisions not
conducive to an efficient certification process for several reasons.
The preamble to the 2020 Rule stated that it was ``reasonable to assume
that Congress intended some appropriate limits be placed on the timing
and nature of such requests [for additional information]'' because of
the overarching statutory timeline. 85 FR 42271 (July 13, 2020). Yet,
neither the 2020 Rule preamble nor its regulatory text articulated how
a 30-day limitation on EPA's initial request for additional information
is compelled or even consistent with the statutory limitation that a
certifying authority must act within a reasonable period of time.
Although it is ideal for EPA to have relevant information to inform its
analysis early in the reasonable period of time, various questions or
needs may arise later in the review process that are critical to EPA
acting on a request for certification. There is nothing in the
statutory language that compels or even suggests that EPA should have a
limited ability to use the reasonable period of time to request
additional information to evaluate a request for certification and make
a fully informed decision. If the Agency is limited in its ability to
request additional information to inform its decision, it may need to
deny a request for certification instead of utilizing the additional
information to possibly grant certification. Such an outcome would
unnecessarily impede the Federal license or permitting process.
The 2020 Rule also unnecessarily injected ambiguity into the
certification process. Section 121.14(b) of the 2020 Rule limited
requests for additional information to that which is ``directly related
to the discharge,'' while Sec. 121.14(c) of the 2020 Rule limited
requests only to information than can be ``collected or generated
within the reasonable period of time.'' Yet neither the phrase
``directly related to the discharge'' nor ``collected or generated
within the reasonable period of time'' was defined nor explained in the
preamble or regulatory text to the 2020 Rule which introduced
uncertainty into what kind of information EPA could actually request.
For example, how would the Agency determine if the information was
directly related to the discharge or that the information could
[[Page 66626]]
be collected or generated within the reasonable period of time?
Furthermore, the statutory language and this final rule already place a
number of limitations on all certifying authority decisions. As
finalized in Sec. 121.7(b), all certifying authorities, including EPA,
must act within the reasonable period of time and within the scope of
certification. EPA finds that these regulatory requirements are
sufficient to ensure the Agency will act on requests for certification
in a timely and appropriate manner. Consistent with the Agency's
removal of the limitations on EPA's ability to request additional
information, EPA is also finalizing the removal of the provisions at
Sec. 121.14(d) and (e) of the 2020 Rule, which discussed how EPA and
project proponents must respond to requests for additional information
or lack thereof.
Consistent with the proposal, Sec. 121.17 provides that when EPA
acts as the certifying authority, it ``shall provide public notice of
the request for certification.'' 40 CFR 121.17(a). The Agency revised
proposed Sec. 121.17 to clarify that EPA will provide public notice on
the request for certification itself, as opposed to merely providing
public notice on the receipt of the request for certification. As
proposed, this final rule does not limit or specify the particular
manner(s) in which the public notice will occur to support broader
public participation. The Agency is also finalizing as proposed that if
a public hearing is determined appropriate when EPA acts as the
certifying authority, the hearing should be scheduled ``at an
appropriate time and place and, to the extent practicable, give all
interested and potentially affected parties the opportunity to present
evidence or testimony in person or by other means.'' 40 CFR 121.17(b).
The statutory language of section 401(a)(1) requires states and
interstate agencies to establish procedures for public notice and
hearings. The 1971 Rule stated that EPA could provide public notice
either by mailing notice to state and local authorities, state agencies
responsible for water quality improvement, and ``other parties known to
be interested in the matter'' (including adjacent property owners and
conservation organizations), or, if mailed notice is deemed
``impracticable,'' by publishing notice in a newspaper of general
circulation in the area where the activity is proposed. 40 CFR 121.23
(2019). With regard to hearings, the 1971 Rule provided that the
Regional Administrator with oversight for the area of the proposed
project has discretion to determine that a hearing is ``necessary or
appropriate,'' and that ``[a]ll interested and affected parties'' would
have reasonable opportunity to present evidence and testimony at such
hearings. Id. EPA updated this provision in the 2020 Rule to expand the
scope of possible parties that may receive notice to avoid
unintentionally narrowing the list of potentially interested parties.
85 FR 42271. Additionally, under the 2020 Rule, EPA placed a timeframe
on when the Agency had to provide public notice following receipt of a
certification request and retained discretion to provide for a public
hearing as necessary or appropriate. Id; see 40 CFR 121.15 (2020).
EPA is finalizing Sec. 121.17 as proposed, with minor, non-
substantive revisions, to facilitate participation by the broadest
number of potentially interested stakeholders and clarify that
following such public notice, the Administrator shall provide an
opportunity for public comment. Consistent with the Federal
Government's commitment to empower communities, protect public health
and the environment, and advance environmental justice in Executive
Orders 14096, 14008, 13990, and 12898, the final rule allows for
outreach designed to reach all potentially interested stakeholders,
including communities with environmental justice concerns. The Agency
encourages doing so by using all appropriate communication and outreach
means and methods (e.g., through local newspapers, online or electronic
media, or other appropriate media). This approach will allow EPA
greater flexibility to address on a case-by-case basis specific issues
regarding notice, such as broadband access issues and requirements for
regional publications, to provide notice in the most appropriate way to
allow for broad participation. Additionally, EPA is not providing an
exhaustive list or examples of potentially interested parties to avoid
unintentionally excluding some interested stakeholders on that list.
EPA generally believes those stakeholders to whom it is appropriate to
provide public notice may include state, Tribal, county, and municipal
authorities, heads of state agencies responsible for water quality,
adjacent property owners, and conservation organizations.
EPA is also finalizing as proposed to provide public notice within
20 days following the date the request for certification is received.
The 1971 Rule did not set a time frame for EPA's public notice after
receiving a request for certification. In contrast, the 2020 Rule
stated that EPA would provide public notice 20 days from receipt of a
certification request. In EPA's view, continuing to provide a timeframe
for EPA's issuance of public notice after receiving a request for
certification will contribute to better accountability, transparency,
and certainty with respect to EPA's handling of requests for
certification. Generally, EPA finds it will be able to provide public
notice within the final rule's timeframe. EPA finalized an identical
timeframe under the 2020 Rule, which it has been able to meet without
difficulty in most instances.
EPA is also finalizing as proposed that once the Administrator
provides public notice on a request for certification, the
Administrator must provide an opportunity for public comment. EPA is
not defining the length of the public comment period. Rather, EPA's
view is that the appropriate timeframe for comment is more
appropriately determined on a case-by-case basis, considering project-
specific characteristics. In general, EPA anticipates a 30-day comment
period; however, comment periods as short as 15 days or as long as 60
days may be warranted in some cases, based on the nature of the
project.
EPA may also hold a public hearing after it provides public notice
on a request for certification. EPA is finalizing the public hearing
provision at Sec. 121.17(b) as proposed, with minor revisions to
remove superfluous language. For context, the 1971 Rule provided that
the Regional Administrator may hold a public hearing at their
discretion. 40 CFR 121.23 (2019). Although ``[a]ll interested and
affected parties'' have the opportunity to present evidence and
testimony at a public hearing, the scope of the hearing is limited to
the question of ``whether to grant or deny certification.'' Id. The
2020 Rule carried forward the position that the Agency has discretion
to determine whether a public hearing is necessary or appropriate;
however, the 2020 Rule removed the limitation on the subject matter of
the public hearing. Consistent with the 2020 Rule, under Sec.
121.17(b) of this final rule, stakeholder input at public hearings may
cover any relevant subject matter on the proposed project to best
inform EPA as it makes its certification decision.
Commenters generally supported EPA's clarifications around the
process when it acts as the certifying authority, including the public
notice and hearing provision updates and procedural revisions. These
commenters said the revisions will help EPA act on requests in a timely
manner. EPA agrees that clarifications in the final rule regarding
[[Page 66627]]
the process when EPA acts as the certifying authority should support
timely actions and streamline the process. EPA finds that the
provisions at Sec. Sec. 121.16 and 121.17 will provide stakeholders
with greater certainty and predictability around the section 401
certification process where EPA acts as the certifying authority.
b. EPA's Role as a Technical Advisor
Section 401(b) provides certifying authorities, project proponents,
and Federal agencies with the ability to ask EPA for technical advice
on applicable effluent limitations, or other limitations, standards,
regulations, or requirements, or water quality criteria, and any
methods to comply with such limitations, standards, regulations,
requirements, or criteria. See also H.R. Rep. No. 92-911, at 124 (1972)
(``The Administrator may perform services of a technical nature, such
as furnishing information or commenting on methods to comply with
limitations, standards, regulations, requirements, or criteria, but
only upon the request of a State, interstate agency, or Federal
agency.''). The 1971 Rule acknowledged this role but limited it to
provision of technical advice on water quality standards. 40 CFR 121.30
(2019). In the 2020 Rule, the Agency modified this provision to expand
the scope of technical advice and assistance EPA might provide to
better align with the statutory text. 85 FR 42274-75.
Consistent with the scope of section 401(b), EPA is finalizing the
proposed revisions to the regulatory text at Sec. 121.18 to reflect
the statutory text more directly. Under this final rule, EPA shall
provide technical advice, upon request by a Federal agency, certifying
authority, or project proponent, on (1) applicable effluent
limitations, or other limitations, standards (including water quality
standards such as water quality criteria), regulations, or
requirements, and (2) any methods to comply with such limitations,
standards, regulations, or requirements. See 40 CFR 121.18. Federal
agencies, certifying authorities, and project proponents may request
EPA's technical assistance at any point in the certification process.
3. Implementation
The Agency has made revisions throughout this final rule to clarify
and help in the implementation of EPA's roles under section 401. With
respect to EPA's technical advisor role, EPA does not intend this final
rule to give EPA the authority to make certification decisions for
states and authorized Tribes, or to independently review state or
Tribal certifications or certification requests. See H.R. Rep. 92-911,
at 124 (1972) (``The Committee notes that a similar provision in the
1970 Act has been interpreted to provide authority to the Administrator
to independently review all State certifications. This was not the
Committee's intent. The Administrator may perform services of a
technical nature, such as furnishing information or commenting on
methods to comply with limitations, standards, regulations,
requirements or criteria, but only upon request of a State, interstate
agency or Federal agency.''). Nor does the Agency consider its role
under section 401(b) to include providing monetary or financial support
to certifying authorities in implementing their section 401 programs.
The Agency observes that there are other means for certifying
authorities to seek financial assistance for their water quality
certification programs (e.g., CWA section 106 grants).
Regarding identifying lands subject to exclusive Federal
jurisdiction, a commenter supported the approach taken in the proposal
to not provide an exclusive list of such areas. While supporting the
approach of not providing an exclusive list, the commenter recommended
the development of guidance to identify areas where EPA acts as a
certifying authority to assist stakeholders and ensure effective
participation in proceedings in these circumstances. While 16 U.S.C.
Chapter 1 identifies multiple national parks as having lands of
exclusive Federal jurisdiction,\87\ EPA does not maintain a map or list
delineating all lands of exclusive Federal jurisdiction. In the
preamble to the 2020 Rule, EPA noted that the number and extent of
lands under exclusive Federal jurisdiction are subject to change and
stated that it is the obligation of the project proponent to determine
the identity of the appropriate certifying authority when seeking
section 401 certification. 85 FR 42270. EPA is maintaining this
position in the final rule. Because such jurisdictional status is
subject to change, EPA is not providing an exclusive list of lands
subject to exclusive Federal jurisdiction. However, EPA is able to
offer technical assistance to stakeholders if questions arise regarding
the appropriate certifying authority on a given federally licensed or
permitted project.
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\87\ These include lands within Denali National Park, Mount
Rainier National Park, Olympic National Park, Hot Springs National
Park, Hawai'i Volcanoes National Park, Yellowstone National Park,
Yosemite National Park, Sequoia National Park, Crater Lake National
Park, Glacier National Park, Rocky Mountain National Park, Mesa
Verde National Park, Lassen Volcanic National Park, Great Smoky
Mountains National Park, Mammoth Cave National Park, and Isle Royale
National Park.
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The Agency is also providing further insight on its plans to
incorporate environmental justice into its role as a certifying
authority. As discussed in section III in this preamble, the Agency
intends for this final rule to address essential water quality
protection policies identified in Executive Order 13990, including
environmental justice. In addition to the policy directive from
Executive Order 13990, other executive orders emphasize the importance
of advancing environmental justice in Federal agency actions. See E.O.
12898, 59 FR 7629 (February 11, 1994) (directing agencies to make
environmental justice part of their mission by identifying and
addressing, as appropriate, disproportionately high and adverse human
health or environmental effects of their programs, policies, and
activities on minority and low-income populations in the United
States), E.O. 14008, 85 FR 7619 (January 27, 2021) (expanding on the
policy objectives established in E.O. 12898 and directing Federal
agencies to develop programs, policies, and activities to address the
disproportionately high and adverse human health environmental,
climate-related and other cumulative impacts on vulnerable,
historically marginalized, and overburdened communities, as well as the
accompanying economic challenges of such impacts); E.O. 14096, 88 FR
25251 (Apr. 21, 2023) (expanding on the policy objectives of E.O. 12898
and E.O. 14008 by further embedding environmental justice for all
through a whole-of-government approach to environmental justice and
directing Federal agencies to consider measures to address and prevent
disproportionate and adverse environmental and health impacts on
communities, to actively facilitate meaningful public participation and
just treatment for all people in agency decision-making, to identify
and address gaps in science, data, and research related to
environmental justice, and to increase accountability and transparency
in Federal environmental justice policy).\88\
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\88\ The Agency also finalized and published the FY 2022-2026
EPA Strategic Plan in March 2022, which includes new environmental
justice strategic goals and emphasis to be embedded in all EPA work.
See https://www.epa.gov/planandbudget/strategicplan.
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Consistent with these directives and EPA technical guidance, when
EPA acts as a certifying authority, the Agency should consider impacts
on communities with environmental justice concerns who
disproportionately bear the burdens of environmental pollution
[[Page 66628]]
and hazards, including Tribal Nations. In considering impacts from a
federally licensed or permitted project, water quality-related impacts
on communities with environmental justice concerns are issues that fall
within the relevant scope of analysis and should inform decision-making
on requests for certification. Specifically, the Agency intends to
consider the extent to which the ``activity'' or any discharge
associated with the activity may cause water quality-related effects
with the potential to impact communities with environmental justice
concerns. Additionally, as discussed above, the Agency finds that
broadening the public notice provision will provide communities seeking
to advance environmental justice with greater opportunities to inform
the certification process.
I. Modifications
1. What is the Agency finalizing?
The Agency is finalizing the proposed modification provision at
Sec. 121.10 with revisions to further clarify the process based on
public comments. Consistent with the proposed approach, EPA is
finalizing a modification provision that only concerns modifications to
a grant of certification (with or without conditions) and does not
apply to a denial of certification or a waiver of certification. The
Agency has revised the regulatory text of the proposed rule to
explicitly provide in the final rule that the certifying authority is
not required to obtain the Federal agency's agreement on the actual
language of the modification after reaching an agreement to modify the
certification. Based on commenter feedback and recommendations, EPA is
finalizing a provision for modifications to a grant of certification
that balances the certifying authorities' need for flexibility to
protect water quality and the potential reliance interests of project
proponents and Federal agencies once the certifying authority has
issued a grant of certification.
2. Summary of Final Rule Rationale and Public Comment
Prior to the 2020 Rule, the Agency's longstanding 1971 Rule allowed
certification modifications to occur after a certification was issued,
provided the certifying authority, Federal agency, and the EPA Regional
Administrator agreed to the modification. 40 CFR 121.2(b) (2019). When
the Agency revised the section 401 regulations in 2020, the rule did
not provide a process for modification of certification decisions after
the certifying authority had acted within the reasonable period of
time; instead, the 2020 Rule preamble acknowledged that certification
modifications could occur through other mechanisms (e.g., as provided
in other Federal regulations) and encouraged Federal agencies to
establish procedures in regulation ``to clarify how modifications would
be handled in these specific scenarios.'' 85 FR 42279 (July 13, 2020).
The Agency acknowledges that the absence of a modification
provision in the 2020 Rule caused significant confusion during
implementation regarding whether and under what circumstances
modifications to certification conditions were allowed. Stakeholders
also expressed significant support for the ability to modify
certification conditions, noting that minor changes may occur in the
project that may not rise to a level that requires a new certification
(e.g., needing to extend the certification's ``expiration'' date to
match a permit extension, or shifting the certified ``work window'' to
reduce the amount of work occurring during high-flow periods), but may
be significant enough to warrant a modification of the certification.
To introduce more clarity and balance the appropriate amount of
flexibility and certainty for all stakeholders, EPA proposed that a
certifying authority may modify a previously granted certification
(with or without conditions) after reaching an agreement to do so with
the Federal licensing or permitting agency. This final rule is
consistent with the Agency's proposed intent, with minor changes to the
regulatory text to better support implementation. Specifically, the
final rule provides additional clarity regarding the agreement between
the Federal agency and the certifying authority. The Agency also
removed proposed references to revoking or modifying a denial or waiver
of certification and clarified the title of the provision to explicitly
reflect the final provision's focus on modifications to grants of
certification.
Although this provision addresses a potential modification to a
certification, after the certification modification is complete, EPA
expects the Federal agency to follow the appropriate Federal license or
permit modification process when incorporating any certification
modifications into a previously issued Federal license or permit.
This final rule remains consistent with the proposal and the
position in the 2020 Rule that CWA section 401 does not provide the
authority for unilateral modifications to a certification decision--
either by the certifying authority or by the Federal licensing or
permitting agency--after the statutory reasonable period of time in
which a certifying authority has to act on a request for certification.
To be clear, the Agency does not intend for modifications to be used to
avoid or extend the reasonable period of time because Sec. 121.10 in
the final rule only applies to previously granted certifications.
a. Returning to a Modification Process
CWA section 401 does not expressly authorize or prohibit
modifications of certifications. Some commenters recommended that the
final rule not include a provision for certification modifications
because it conflicts with the one-year limit for certifying authority
action. A few commenters argued that Congress defined and precisely
time-limited the ability of certifying authorities to review the
potential impacts of federally licensed or permitted projects. These
commenters argued that the ability to modify or ``reopen'' a
certification decision renders the express time limits Congress imposed
in section 401(a)(1) meaningless. EPA disagrees and concludes that the
best interpretation of section 401 is one that allows for modifications
with reasonable guardrails like the ones in this final rule. This
interpretation is supported by the text of section 401, which envisions
the certifying authority participating in the Federal licensing or
permitting process after the issuance of a certification. See 33 U.S.C.
1341(a)(3)-(4).\89\
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\89\ See Keating v. FERC, 927 F.2d 616, 621-22 (D.C. Cir.1991)
(summarizing section 401(a)(3)); see also 115 Cong. Rec. 9257, 9268-
9269 (April 16, 1969) (discussing a hypothetical need for a state to
take another look at a previously certified federally licensed or
permitted activity where circumstances change between the issuance
of the construction permit and the issuance of the operation
permit).
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The Agency does not view modifications as contrary to the text of,
or congressional intent supporting, the reasonable period of time
limitation. First, on its face, the reasonable period of time
limitation only applies to the certifying authority's original action
on the request for certification. See 33 U.S.C. 1341(a)(1) (requiring a
certifying authority to act on a request for certification within a
reasonable period of time not to exceed one year); see also 40 CFR
121.7(a) and (b) (interpreting the term ``to act on a request for
certification'' to mean the certifying authority must make a decision
to grant, grant with conditions, deny, or expressly waive certification
within the reasonable period of time). The statute
[[Page 66629]]
is silent regarding subsequent modifications. Second, in imposing the
reasonable period of time limitation, Congress was concerned by the
potential for the certifying authority's ``sheer inactivity'' to delay
the project. See H.R. Rep. 92-911, at 122 (1972). That concern is not
present with modifications to a grant of certification because the
certifying authority will have already acted on the request.
EPA requested comment on whether it should place a time limit on
when a certifying authority can modify its grant of certification in
relation to the issuance of the Federal license or permit. While a few
commenters argued that a certification should not be modified after the
Federal license or permit is issued, several commenters asserted that
certification modifications may be necessary to account for unforeseen
water quality impacts during the life of the Federal license or permit,
particularly for projects that can last decades. To balance stakeholder
interests, EPA is not imposing such a time limit on when modifications
to a grant of certification can occur in relation to the issuance of
the Federal license or permit. The final rule's modification provision
provides project proponents, certifying authorities, and Federal
agencies with the flexibility to address project changes and avoid the
burden of having to seek a new certification where the certifying
authority and the Federal agency agree.
EPA also requested comment on whether EPA should identify a list of
scenarios that may warrant certification modification. The preamble to
the proposed rule provided examples of minor changes that may not rise
to the level of requiring a new request for certification, but may be
significant enough to warrant a modification of the granted
certification (e.g., needing to extend the certification's
``expiration'' date to match a permit extension, or shifting the
certified ``work window'' to reduce the amount of work occurring during
high-flow periods). 87 FR 35361 (June 9, 2022). However, EPA did not
propose an exclusive list of scenarios that may warrant modification.
EPA received a wide range of comments on whether to list such
scenarios, with most commenters requesting flexibility to address new
information or project changes without providing specific details about
what they meant by ``new information'' or ``project changes.'' A couple
of commenters recommended that EPA develop a list of scenarios where
modifications are appropriate, whereas a few commenters expressed
support for the modification process precisely because the proposal did
not define all circumstances in which modification is appropriate.
After reviewing public comment, EPA is not finalizing such a list
because the certifying authority and Federal agency are in the best
position to work together to determine whether a new certification or a
certification modification is appropriate in a given situation.
Although EPA understands the perspective of most commenters that it may
be helpful to have examples of circumstances where a modification to a
certification may be appropriate, EPA is declining to include a non-
exhaustive list in the regulatory text so that certifying authorities
and Federal agencies retain the flexibility to determine their
certification modification needs after considering the local water
quality and project-specific context. Even without a list in the
regulation, EPA still expects that the Federal agency will not
unreasonably withhold its agreement to modifications, especially for
administrative edits, such as correcting typographical errors, changing
a point of contact, or adjusting a certification's expiration date to
reflect an updated license or permit expiration date.
In contrast to identifying scenarios warranting certification
modifications, a few commenters recommended that EPA develop guidance
regarding scenarios where a new request for certification is necessary,
instead of a certification modification, to provide clarity on the
outer limits of modifications. As noted above, EPA is declining to
finalize any bright line scenarios (e.g., specific new information or
changed circumstances) for when a modification is appropriate versus
when a new certification request is required. The Agency cannot
anticipate all the scenarios in which one path may be appropriate over
the other, nor can the Agency predict how state, territorial, and
Tribal certification modification processes will determine which path
to take. Beyond modifications to existing certifications, there may be
circumstances that warrant the submission of a new request for
certification, such as if certain elements of the activity (e.g., the
location or size of the activity) change materially in a manner that
could impact water quality after a project proponent submits a request
for certification. If the activity changes so materially after the
request for certification as to constitute a different activity, this
may warrant a new request for certification. The 2020 Rule preamble
also recognized this possibility. See 85 FR 42247 (``[I]f certain
elements of the proposed project (e.g., the location of the project or
the nature of any potential discharge that may result) change
materially after a project proponent submits a certification request,
it may be reasonable for the project proponent to submit a new
certification request.'').
b. Limits to Modification of Certification Decisions
In Sec. 121.10 of the final rule, EPA is finalizing limits to
certification modifications. The Agency made small changes to the
proposed regulatory text to clarify these limits, including an
adjustment of the provision title from ``Modifications'' to
``Modification to a grant of certification'' to clarify that
modifications are limited to grants of certification. 40 CFR 121.10.
Another adjustment was to flip the substance of proposed Sec.
121.10(a) and (b) in the final rule so that the text first identifies
the modification process and then its limitations. Furthermore, the
Agency removed references to modifying denials or waivers of
certification from proposed Sec. 121.10(a) and revised the term
``modify'' in proposed Sec. 121.10(a)(4) to ``change'' in Sec.
121.10(b)(2) of the final rule.
As noted above, EPA intends that a modification to a grant of
certification means a change to an element or portion of a
certification or its conditions--it does not mean a wholesale change in
the type of certification decision or a reconsideration of the decision
whether to certify (e.g., changing a grant of certification to a denial
of certification). Section 121.10(b) of the final rule makes this clear
by providing that a certifying authority may not--through the final
rule's modification provision--revoke a grant of certification or
change it into a denial or waiver. Constraining certifying authorities
from fundamentally changing their certification action through a
modification process recognizes reliance interests and promotes
regulatory certainty. Further, EPA has concerns that changing the
fundamental nature of the certification action (e.g., change a grant,
denial, or waiver to something entirely different) may be inconsistent
with the congressional admonition to act on a certification request
within the statutory reasonable period of time. In addition, commenters
indicated much greater interest regarding modification to grants of
certification, and very little interest regarding modifications to a
denial or waiver. Commenters also expressed confusion regarding EPA's
proposed language regarding modifications to a denial or waiver.
While the final rule text does not address modifications to denials
or waivers for the reasons discussed above,
[[Page 66630]]
EPA nonetheless concludes for the reasons mentioned above that section
401 does not authorize a certifying authority to ``modify'' a denial or
waiver into a fundamentally different decision such as a grant of
certification. As discussed in the proposed rule preamble, if a
certifying authority has previously waived certification, that waiver
may not be modified because there would be no ``certification'' to
modify. 87 FR 35361-62. Thus, a certifying authority may not ``modify''
a waiver by changing it into a grant, a grant with conditions, or a
denial. And finally, a denial of certification cannot be modified into
a grant (with or without conditions) of certification or a waiver of
certification.\90\
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\90\ Of course, nothing in section 401 or this final rule would
preclude a project proponent from requesting certification again
after a denial without prejudice and then the certifying authority
could act in a different manner upon the second request if
circumstances have changed. See section IV.F in this preamble.
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In contrast to this position, some commenters stated that EPA
should allow for certification revocations. A few of these commenters
recommended allowing revocations when done in accordance with the
certifying authority's laws or regulations. One commenter suggested
that EPA change the modification provision to allow for a denial of
certification to be modified or revoked prior to the finalization of a
Federal license or permit denial. Another commenter recommended
allowing a granted certification to be revoked or modified into a
denial of certification when new information is received pertaining to
a project, which may substantively change the scope of work that may
result in a discharge. Another commenter suggested that EPA should add
language to clarify that the certifying authority retains the right to
revoke the certification in circumstances where the project proponent
provided false or misleading information on which the certification
decision was based.
The Agency recognizes the ongoing need to adapt to new and changing
information about water quality impacts of a project after a
certification decision has been issued, but the Agency is declining to
broaden the final rule's modification provision to be a mechanism to
revoke or reverse a certification decision. As discussed above, while
the statutory language and legislative history appear to countenance a
role for certifying authorities after a certification is issued, EPA
concludes that this role does not include unilateral action to revoke
or reverse the decision.\91\ EPA reiterates that if the activity
changes significantly after a certification decision has been issued
(e.g., material change in the breadth or location of the activity),
this may warrant a new request for certification.
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\91\ This statement and more broadly Sec. 121.10 of this final
rule are not meant to address certifying authority action on a
request for certification upon remand from a court or administrative
tribunal of the certifying authority's initial action on the
request. Section 121.10 is also not intended to address or govern
court vacatur of certification decisions, or action by a certifying
authority after a court vacatur (although the Agency notes that it
is unclear how a vacated certification decision could be
``modified''). This final rule does not address the situations of
vacatur or remand by a court or administrative tribunal.
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i. Timing of Modifications to a Grant of Certification
Under this final rule, a certification modification could occur
only if the certifying authority had granted certification (with or
without conditions) within the reasonable period of time. The Agency
maintains this position from the proposal in the final rule because the
reasonable period of time limitation in the statute concerns the
certifying authority's action on a request for certification.
Accordingly, the Agency is finalizing a modification provision where a
modification to an element or a portion of a granted certification
occurs after the reasonable period of time in which the certifying
authority acted. See 87 FR 35361 (``Under this proposed rulemaking, a
certification modification could occur after the reasonable period of
time in which the original certification decision was made.'').
EPA requested comment on whether the certification modification
process should account for (1) whether there is a Federal license or
permit modification process already in place and (2) the point in time
at which a modification may be made (e.g., if new information
supporting a modification arises either before or after issuance of the
license or permit). The Agency is not including a time limit on when
modifications can occur so that modifications can happen at any time
after the reasonable period of time ends, including prior to and after
the issuance of a Federal license or permit until the expiration of the
license or permit.
Many commenters supported there being no time limit for
modifications. These commenters expressed the view that modifications
are necessary to reflect changing conditions, scientific understanding
of water quality effects, and changes to the project. Multiple
commenters explained that placing a time limit on modifications may
impede the project proponent's ability to remain in compliance on
projects with unanticipated or unpredictable project scope and schedule
changes and that restarting the certification process because of a
project change during construction could result in significant impacts
to project costs and public safety and would not be efficient,
effective, or predictable. A few commenters highlighted the need for
certification modifications, especially for projects with longer
lifespans, such as large pipelines and hydropower projects with FERC
licenses for 30-50 years. These commenters argued that there should not
be a limit on the period when certification modifications can be
addressed because some projects are ongoing for a long time, during
which time water quality concerns may arise. Conversely, one commenter
argued that EPA should not finalize a modification provision; however,
the commenter recommended that if a modification provision is
finalized, no modifications to certifications should occur after the
Federal license or permit is issued.
After considering public comment, the Agency is promulgating a
final rule at Sec. 121.10 that provides the opportunity for
certification modification at any point after certification issuance
(until the expiration of the Federal license or permit), provided the
Federal agency and the certifying authority agree in writing prior to
modifying the grant of certification. As commenters noted, changes to
an activity with implications for water quality can occur at any point
in time after a certification is granted. Accordingly, the Agency finds
this approach best reflects the reality that projects change over time
and provides flexibility for project proponents, certifying
authorities, and Federal agencies to adapt to changing circumstances
without needing to reinitiate the certification process.
ii. Agreement for a Modification to a Grant of Certification
Consistent with the Agency's longstanding approach to certification
modifications, EPA is finalizing the ability for a certifying authority
to modify a grant of certification (with or without conditions)
provided that the Federal agency and certifying authority agree in
writing that the certifying authority may modify the certification.
However, such agreement does not require the certifying authority and
Federal agency to agree to the substance of such a modification.
Although EPA recommends that the modification process be collaborative,
EPA is not
[[Page 66631]]
suggesting that Federal agencies and certifying authorities must
collaborate on the specific language of the certification modification,
as discussed more below. Additionally, the certifying authority may
modify only those portions of the certification that the two parties
agreed upon.
Similar to the 1971 Rule, EPA is finalizing that a modification may
only occur where a Federal agency and certifying authority agree in
writing that the certification may be modified. While the parties must
agree that one or another part of the certification can be modified,
the certifying authority is not required to obtain the Federal agency's
agreement on the specific language of such modification. Simply put,
EPA expects that the certifying authority and the Federal agency's
agreement would identify those portions of the certification decision
that the certifying authority could modify, and then the certifying
authority would be responsible for drafting the modification language.
Because of commenter requests for greater clarity regarding what the
Federal agency gets to review prior to agreeing to a modification, EPA
is finalizing additional text in Sec. 121.10(a) to clarify that the
certifying authority is not required to obtain the Federal agency's
agreement on the language of the modification.
Some of the commenters who supported the proposed process for
Federal agency and certifying authority agreement to a modification
asserted that the Federal agency should not have a role in determining
the specific language of a modification for various reasons, including
concern that adding a new conferencing and agreement process could lead
to delays and the fact that the Federal agency does not review
certification content during the original certification issuance.
EPA agrees with these commenters. Congress recognized certifying
authorities as the ``most qualified'' to make decisions about impacts
to their water quality, and not Federal agencies. See 115 Cong. Rec.
29035, 29053 (Oct. 8, 1969) (Mr. Muskie: ``By requiring compliance
certification from the water pollution control agency, [the
certification provision] would assign policing responsibility to those
agencies most qualified to make an environmental decision and not to
those committed to carrying out some other function at minimum
cost.''). The Agency finds that certifying authorities are best
equipped to both determine the language of a certification decision and
the language of any subsequent modification to that decision.
Accordingly, EPA is finalizing a process where the certifying authority
only needs Federal agency agreement over the portions of the
certification to be modified rather than the modified language itself.
The Agency notes that certifying authorities are free to discuss the
substance of a modification with a Federal agency but are not compelled
to do so under this final rule.
Additionally, EPA requested comment on whether the final rule
should provide project proponents with an explicit role in the
modification process. A few commenters recommended that the project
proponent should have a role in the process, for various reasons:
because section 401 is framed around the role of the applicant, because
the Federal agency and certifying authority may lack the technical
knowledge for the modification; because often the project proponent is
the party initiating the project modification; and because including
the project proponent in the modification decision or at least
providing an opportunity for public notice is a more transparent and
legally defensible approach that considers the project proponent's
reliance interests.
Consistent with the 1971 Rule, Sec. 121.10 as finalized does not
provide the project proponent with a formal role in the modification
process. However, the Agency does not expect the process described in
Sec. 121.10 to prevent engagement with the project proponent before or
after the certifying authority and Federal agency have agreed that the
certifying authority may modify the previously granted certification.
EPA recommends that certifying authorities engage with the stakeholders
who will be impacted by a modification to the certification; some
certifying authorities may even be required under their regulations to
make any proposed modifications to their certification decisions
available for public notice and comment.
Unlike the 1971 Rule, the Agency is not finalizing a role for EPA
in the certification modification process where the Agency is neither
the certifying authority nor the Federal licensing or permitting
agency. As noted in the 2020 Rule preamble, the statute does not
expressly provide EPA with a role in the certification modification
process, unlike the Agency's other roles under section 401.\92\ See 85
FR 42278. Additionally, although the 1971 Rule provided the Agency with
an oversight role in the modification process, the preamble to the 1971
Rule did not explain why. See 36 FR 8563-65 (May 8, 1971). The Agency
does not see the need to reintroduce such a role now, especially where
EPA was not involved in the original certification decision and is not
the relevant Federal permitting agency. EPA concludes that it should
not have an oversight role in the certification modification process.
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\92\ See section IV.H in this preamble discussing EPA's specific
roles identified in section 401, including acting as a certifying
authority on behalf of jurisdictions lacking authority, notifying
other jurisdictions where their water may be affected by a discharge
from another jurisdiction, and providing technical assistance upon
request.
---------------------------------------------------------------------------
The cooperative approach in the final rule does not allow for
unilateral modifications by certifying authorities, which includes
through any ``reopener'' clauses included in a grant of certification.
Reopener clauses purport to authorize a certifying authority to
``reopen'' and modify a certification at a later date. The final rule's
position on unilateral modification is consistent with the position
taken in the 2020 Rule. See 85 FR 42279. The Agency continues to
disagree with commenters who stated that certifying authorities should
be allowed to unilaterally modify or revoke a section 401 certification
decision if they have asserted this ability through a ``reopener''
condition incorporated into the original certification decision.
Some commenters recommended that EPA allow reopener clauses and
discussed their prevalence in certifications. For example, one
commenter asserted that certifications often include ``reopener'' or
similar conditions and cited to a few state regulations that the
commenter viewed as authorizing reopeners or unilateral modifications.
Another commenter asserted that virtually every condition of one
certifying authority is subject to further modification and provided an
example of one such certification where the certifying authority
reserved the right to add or modify the conditions of certification
under various specified circumstances. Another commenter recommended
that the final rule make clear that certifying authorities can reopen
certification based on a showing of changed circumstances and ongoing
effects of project operations failing to meet water quality standards.
Other commenters recommended that the final rule prohibit
``reopener'' and similar certification conditions that purport to allow
certifying authorities to unilaterally add or revise certification
requirements after the reasonable period of time ends or after the
issuance of the Federal license or permit. A few commenters asserted
that reopener conditions are plainly inconsistent with section 401
because they allow certifying authorities to make certification
decisions after the
[[Page 66632]]
maximum one-year period allowed by the statute and after the Federal
license or permit had been issued. The commenters continued that
reopeners transform section 401's limited grant of authority to states
to certify Federal license and permit applications into an ongoing
regulatory role. Another commenter asserted that ``reopeners'' are
contrary to the express and prescriptive provisions for post-
certification authority that Congress provided in CWA section 401(a)(3)
and 401(a)(4).
As discussed above, EPA's final rule does not authorize certifying
authorities to unilaterally (i.e., without Federal agency agreement)
``reopen'' or modify a certification decision. This holds true
regardless of whether a certifying authority has inserted language into
its grant of certification asserting this extra power.\93\ EPA is the
Federal agency tasked with administering and interpreting the CWA, see
33 U.S.C. 1351(d), 1361(a), including section 401, see Ala. Rivers
Alliance v. FERC, 325 F.3d 290, 296-97 (D.C. Cir. 2003); NYSDEC, 884
F.3d at 453, n.33, and EPA's interpretation supersedes any contrary
interpretation taken by a certifying authority. Certifying authorities
cannot bootstrap themselves greater authority to modify a certification
beyond what is authorized in this final rule at Sec. 121.10. However,
EPA wishes to emphasize the distinction between reopener clauses and
adaptive management conditions, the latter of which are permissible
under the final rule. See section IV.F of this preamble for further
discussion of adaptive management conditions.
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\93\ This statement is not meant to address a certifying
authority's action on a state or tribally- issued license or permit,
which sometimes concurrently acts as the state or Tribe's section
401 certification decision. Such matters are outside the scope of
this rulemaking.
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c. Changes to the NPDES Regulations for Certification Modifications
EPA is also finalizing deletion of 40 CFR 124.55(b), which
described the circumstances under which a modification may be made to a
certification on an EPA-issued NPDES permit. The approach to
modifications in Sec. 124.55(b) differed from the approach EPA is
finalizing at Sec. 121.10. First, it addressed a subset of situations
in which a modification would be permissible (i.e., a change in state
law or a stay, vacatur, or remand of a certification), while staying
silent regarding whether modifications would be appropriate in other
situations. Second, it suggested that in the identified situations,
such as a change in state law or regulation, a previously issued grant
of certification could be converted to a waiver, while this final rule
takes the general position that a certifying authority cannot change a
grant of certification into a fundamentally different certification
action through a modification pursuant to Sec. 121.10. Third, it did
not require EPA as the Federal permitting agency to agree to the
modification. Forth, it arguably suggested that in the identified
situations, a modification was more appropriate than a new request for
certification, an issue that EPA intentionally does not address in this
final rule. Finally, it expressly precluded EPA from incorporating
modified conditions into the NPDES permit except in one narrow
circumstance: to delete a NPDES permit condition based on a condition
in a certification invalidated by a state court or board, and only upon
the request of the permittee. However, as discussed supra at section
IV.G of this preamble, section 401(d) requires a Federal permitting
agency to incorporate certification conditions into the Federal permit
as conditions of that permit. EPA sees no reason why this fundamental
principal should not apply to conditions of a modified certification.
For this reason, EPA expects Federal agencies will agree to allow a
modification only when the agency is willing to modify its license or
permit or otherwise incorporate the modified certification conditions
into its license or permit. EPA is finalizing deletion of Sec.
124.55(b) because of these differences in approach between this final
rule and Sec. 124.55(b). As a result of the deletion of Sec.
124.55(b), all certification modifications, including those for EPA-
issued NPDES permits, must follow the approach finalized at Sec.
121.10. A corresponding technical edit was made to 40 CFR
122.62(a)(3)(iii) to remove the reference to Sec. 124.55(b).
EPA requested comment on whether the final rule should allow a
certifying authority to unilaterally modify a certification in the
circumstances identified in former Sec. 124.55(b) such as a change in
state law or regulation upon which a certification is based, or if a
court of competent jurisdiction or appropriate state board or agency
stays, remands, or vacates a certification after Federal license or
permit issuance. A few commenters recommended retaining 40 CFR
124.55(b) instead of the proposed Sec. 121.10. To support their
recommendation to retain 40 CFR 124.55(b), one commenter stated that
EPA failed to describe any confusion, regulatory uncertainty, or other
problems attributed to the certification modification provisions in the
NPDES program.
In response to these commenters, EPA notes that the modification
provision previously located at 40 CFR 124.55(b) only applied to
modifications to certifications for NPDES permits issued by EPA and did
not extend to licenses and permits issued by other Federal agencies.
Therefore, retaining 40 CFR 124.55(b) instead of the provision proposed
at 40 CFR 121.10 would not have provided additional clarity for
stakeholders interested in modifying a certification for those licenses
and permits issued by other Federal agencies. Furthermore, EPA intends
for Sec. 121.10 to apply to all certification modifications, including
those on certifications for EPA-issued NPDES permits. Finally, EPA was
concerned that leaving Sec. 124.55(b) in place could introduce
stakeholder confusion when read with final rule Sec. 121.10 because it
may have wrongly indicated that the circumstances in Sec. 124.55(b)
are the only circumstances in which EPA might agree to modify a
certification on an EPA-issued NPDES permit, and as discussed above,
Sec. 124.55(b) conflicted with several key features of this final
rule's approach to modifications. However, nothing in this final rule
prohibits EPA in its capacity as a Federal permitting agency to
continue to agree to modifications to certifications in the types of
circumstances previously prescribed in 40 CFR 124.55(b), as long as
such modifications are consistent with Sec. 121.10 of the final rule.
The final rule is broadening the circumstances under which the Agency
might agree with a certifying authority that a modification is
appropriate for a certification of an EPA-issued NPDES permit.
EPA does not expect to develop an exhaustive list of circumstances
under which EPA (when acting as the Federal permitting agency) expects
to agree to a modification to a grant of certification by a certifying
authority; however, EPA will work with certifying authorities where
unanticipated water quality impacts, shifting project design plans, and
new information warrant a modification to a grant of certification (and
subsequently a modification to an EPA-issued NPDES permit). The Agency
may develop guidance in the future regarding Agency agreements to
modifications of grants of certification for NPDES permits issued by
EPA.
3. Implementation
As previously discussed, the Agency is finalizing a process for
modifying a grant of certification that requires the certifying
authority and Federal agency
[[Page 66633]]
to agree that a modification is appropriate but does not require
agreement on the substance of the modification. The process is meant to
support a cooperative approach to adapting to changing circumstances or
new information in an efficient and transparent way. As with other
parts of the final rule, EPA is updating the section 401 regulations
regarding modifications to support some of the past practices that
certifying authorities and Federal agencies became familiar with over
50 years prior to the 2020 Rule. This includes a collaborative
modification process like the one in the 1971 Rule. EPA is not aware of
issues with modifications pursued under the 1971 Rule and notes that
many stakeholders requested implementation guidance after the 2020 Rule
omitted a process for modifying certification decisions. Therefore, the
modification provision of the final rule will restore flexibility and
efficiency where certifying authorities and Federal agencies find it
appropriate to update a previously issued grant of certification rather
than restart the section 401 certification process in response to
changed circumstances or new information. However, EPA does not expect
the modification provision to address every issue that may arise after
a certification has been granted.
Certifying authorities and Federal agencies are encouraged to work
together to address new information or changed water quality conditions
throughout the life of the project such that congressional intent
behind section 401--enabling states to protect their water quality--can
be preserved. In the spirit of cooperative federalism central to
section 401, EPA expects that Federal agencies will not unreasonably
withhold agreement to a modification. The provision at 40 CFR 121.10
also does not preclude Federal agencies from developing a process for
coordinating on certification modifications within the framework
provided in this final rule.
EPA recommends that certifying authorities maintain clear records
surrounding the development of certification decisions and any
modifications to previously granted certifications, including
justifications for modifying any certification conditions.\94\ EPA
wishes to emphasize that the same scope of section 401 that applies to
a certification decision also applies to any subsequent modification to
a grant of certification. See 40 CFR 121.3(b).
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\94\ See discussion in section IV.F.2.d of this preamble
regarding EPA's recommendation that certifying authorities include
in their certification conditions a statement explaining why each of
the included conditions is necessary to assure that the activity
will comply with water quality requirements. See also 40 CFR
121.7(d)(3).
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J. Enforcement and Inspections
1. What is the Agency finalizing?
This section of the preamble discusses several issues that have
arisen with respect to enforcement of the requirement to obtain CWA
section 401 certifications and enforcement of certification conditions.
EPA did not propose to retain any regulatory text regarding enforcement
of the requirement to obtain section 401 certification or enforcement
of certification conditions.\95\ However, EPA requested comment on
whether it should add regulatory text on its interpretations on the
enforceability of certification conditions by Federal agencies and
certifying authorities; the judicial holdings regarding the application
of the CWA citizen suit provision to certifications and certification
conditions; and the interpretation of the term ``review'' in CWA
section 401(a)(4). EPA is not finalizing any regulatory text on
enforcement, consistent with the proposal. See 87 FR 35363 (June 9,
2022). Nevertheless, in light of the pre-proposal input and public
comments EPA received on this issue, as well as stakeholder concern and
confusion over how the 2020 Rule addressed CWA section 401 enforcement,
EPA will discuss some of the more common concerns that have been
identified regarding enforcement of the requirement to obtain section
401 certification and enforcement of certification conditions. To be
clear, EPA is not offering new interpretations or positions on the
issues discussed below.
---------------------------------------------------------------------------
\95\ EPA is finalizing regulatory text regarding Federal agency
review of certification decisions. See section IV.G of this preamble
for further discussion.
---------------------------------------------------------------------------
2. Summary of Final Rule Rationale and Public Comment
a. General Enforcement Issues
Section 401 contains three provisions directly relevant to
enforcement. First, section 401(a)(4) provides certifying authorities
with an opportunity, prior to operation, to inspect a certified
federally licensed or permitted activity or facility that does not
require a Federal operating license to assure its operation will not
violate water quality requirement. 33 U.S.C. 1341(a)(4). If the
certifying authority determines that the operation will violate
applicable water quality requirements, the Federal agency may suspend
the Federal license or permit after a public hearing. Id. Second,
section 401(a)(5) provides that any certified Federal license or permit
may be ``suspended or revoked'' by the Federal agency ``upon the
entering of a judgment under [the CWA] that such facility or activity
has been operated in violation'' of the enumerated sections of the CWA.
Id. at 1341(a)(5). Third, section 401(d) provides that if a grant of
certification includes conditions, those conditions ``shall become a
condition on any Federal license or permit subject to the provisions of
this section.'' Id. at 1341(d).
Of these three provisions, the 1971 Rule only included regulatory
text on section 401(a)(4), as discussed below in the section on
inspection authority. The 1971 Rule did not contain any regulatory
provisions addressing section 401(a)(5) or section 401(d) (the latter
of which was not added to the statute until the 1972 amendments). The
2020 Rule addressed section 401(d) and section 401(a)(4). Regarding
section 401(d), the 2020 Rule stated that the Federal agency ``shall be
responsible for enforcing certification conditions'' incorporated into
its license or permit. 40 CFR 121.11(c) (2020). Regarding section
401(a)(4), the 2020 Rule allowed the pre-operation inspection under
section 401(a)(4) of all certified projects, regardless of whether they
had received a subsequent Federal operating license or permit. Id. at
Sec. 121.11(a) and (b) (2020). The 2020 Rule preamble also stated that
the ``CWA does not provide an independent regulatory enforcement role
for certifying authorities,'' 85 FR 42275 (July 13, 2020), and declined
to finalize an interpretation regarding CWA section 505 citizen suits
and section 401. Id. at 42277.
In both pre-proposal input and public comment, stakeholders
generally agreed that Federal agencies could enforce certification
conditions. However, stakeholders expressed concern that the 2020 Rule
prevented states and Tribes from exercising their independent
enforcement authority and relied solely on Federal agencies to enforce
certification conditions. Many commenters raised concerns over Federal
agencies' willingness or capacity to enforce certifications and
certification conditions. For example, some commenters asserted that
Federal agency resource limitations coupled with the large
jurisdictional territories necessitate state and Tribal enforcement,
otherwise the conditions may never be enforced. Conversely, some
commenters asserted that certifying authorities did not have an
enforcement role either under section 401 or any other provision of the
CWA,
[[Page 66634]]
including section 505 (the CWA's citizen suit provision). Other
commenters asserted that section 505 provided for citizen suit
enforcement of both failures to obtain section 401 certification and
failure to comply with certification conditions. Many commenters
requested that EPA expressly state in the final rule that states and
Tribes have independent authority under the CWA to enforce
certifications and certification conditions.
EPA observes that this final rule is generally focused on
interpreting the text of section 401 itself, and not other provisions
of the CWA. Section 401 does not directly address state or Tribal
enforcement authority and the Agency is declining to add regulatory
text on that issue. Consistent with the approach taken in the 2020
Rule, this rulemaking does not include interpretations of other
enforcement-related sections of the CWA, such as section 505. As such,
the Agency is not adding regulatory text to address state or Tribal
enforcement authority with respect to section 505.
The Agency views section 401 certification conditions that are
incorporated into the Federal license or permit as enforceable by
Federal licensing or permitting agencies. Section 401(d) provides that
if a grant of certification includes any conditions, those conditions
``shall become a condition on any Federal license or permit.'' As a
result, the Federal agency can enforce any such conditions in the same
manner as it can enforce any other conditions of its license or permit.
EPA expressed this interpretation in the 2020 Rule, 85 FR 42275-76, and
a decade prior to that rulemaking. See, e.g., 2010 Handbook at 32
(rescinded in 2019, see supra). EPA also observes that Federal agencies
have considerable discretion in deciding whether and when to enforce
requirements and conditions in their licenses and permits. See Heckler
v. Cheney, 470 U.S. 821, 831 (1985) (discussing why it is important for
agencies to retain enforcement discretion).
However, as noted above, the 2020 Rule included regulatory text
that explicitly stated that Federal agencies were responsible for
enforcing certification conditions incorporated into its Federal
license or permit. 40 CFR 121.11(c) (2020). EPA proposed to remove this
regulatory provision because it introduced ambiguity into the Agency's
longstanding position that nothing in section 401 precludes states from
enforcing certification conditions when authorized under state law (and
not precluded by other Federal law besides section 401). It has also
led to stakeholder confusion over whether the 2020 Rule prevented
states and Tribes from exercising their independent enforcement
authority and whether the 2020 Rule limited Federal agency discretion
regarding their enforcement of section 401 conditions in their licenses
or permits. Most commenters supported EPA's proposal to remove the 2020
Rule's language at Sec. 121.11(c). However, some commenters disagreed
with EPA's proposed approach, arguing that the enforcement of
certification conditions incorporated into Federal licenses or permits
must lie exclusively with the Federal permitting and licensing
agencies. EPA disagrees. The Agency has consistently taken the view
that nothing in section 401 precludes states from enforcing
certification conditions when so authorized under state law. In the
2020 Rule preamble, the Agency concluded that ``[n]othing in this final
[2020] rule prohibits States from exercising their enforcement
authority under enacted State laws.'' 85 FR 42276. EPA did, however,
consider this authority limited to ``where State authority is not
preempted by federal law.'' Id. A decade prior to the 2020 Rule, EPA
had already recognized that states enforce certification conditions
when authorized to do so under state law. See e.g., 2010 Handbook at
32-33 (rescinded in 2019, see supra) (``Many states and tribes assert
they may enforce 401 certification conditions using their water quality
standards authority.'').
Some commenters argued that Federal and certifying authority
enforcement will lead to confusion, unnecessary litigation, and
possibly duplicative or inconsistent enforcement actions and
conditions. EPA disagrees that Federal and certifying authority
enforcement will lead to confusion or duplicative actions. After over
50 years of section 401 implementation experience, EPA expects that
certifying authorities and Federal agencies are well-versed in
coordinating enforcement actions. Nevertheless, EPA recommends that
certifying authorities clearly indicate which certification conditions
derive from state or Tribal law.
With respect to CWA citizen suits and their application to both the
requirement to obtain section 401 certification and the requirement to
comply with certification conditions, some courts have addressed these
issues. First, the Ninth Circuit Court of Appeals held that citizen
suits may be brought to enforce the requirement to obtain
certification. ONDA v. Dombeck, 172 F.3d 1092, 1095 (9th Cir. 1998). In
ONDA, the court rejected the argument that CWA section 505 authorizes
only suits to enforce certification conditions but not the requirement
to obtain a certification. The court pointed to the plain language of
section 505, which cross-references the entirety of section 401 (and
not, for example, only section 401(d), which concerns certification
conditions). Id. Second, a few Federal courts have held that
certification conditions can be enforced through CWA citizen suits. In
Deschutes River Alliance, a U.S. district court considered the issue at
length and ultimately held that CWA section 505 authorizes citizens to
enforce certification conditions. See Deschutes River Alliance v.
Portland Gen. Elec. Co., 249 F. Supp. 3d 1182, 1188 (D. Or. 2017)
(considering the issue with respect to a FERC license); see also Pub.
Emps. for Envtl. Responsibility v. Schroer, No. 3:18-CV-13-TAV-HBG,
2019 WL 11274596, at *8-10 (E.D. Tenn. June 21, 2019) (relying in part
on Deschutes River Alliance and considering the issue with respect to a
section 404 permit issued by the Corps). EPA is not aware of any
Federal court that has considered the issue and reached the opposite
conclusion. Deschutes River Alliance also noted that certifying states
(in addition to the citizen group before the court) are among the
persons that may enforce certification conditions via the CWA citizen
suit provision. 249 F. Supp. 3d at 1191-92. The court reasoned that
section 505 is the only provision of the CWA that could bestow Federal
authority upon states to enforce certification conditions and, given
this, interpreting section 505 to preclude state enforcement of
certification conditions would run ``contrary to the CWA's purpose and
framework.'' Id. at 1191.
b. Certifying Authority Inspection Authority
As discussed above, section 401(a)(4) identifies one set of
circumstances where the certifying authority may review the manner in
which a facility or activity will operate once the facility or activity
has received certification. 33 U.S.C. 1341(a)(4). The certifying
authority's review is limited to determining if the post-construction
operation of the facility or activity will ensure that applicable
effluent limitations, other limitations, or other applicable water
quality requirements will not be violated. Section 401(a)(4) further
states that when the certifying authority notifies the Federal agency
that the operation or activity will violate effluent limits, other
limits or other water quality requirements, the Federal agency, after
public hearing, may suspend the Federal license or permit.
[[Page 66635]]
Id. The Federal license or permit shall remain suspended until there is
reasonable assurance that the facility or activity will not violate CWA
section 301, 302, 303, 306, or 307. Id.
The 1971 Rule clarified that the ability to ``review the manner in
which the facility or activity shall be operated or conducted'' meant
the right to inspect a facility or activity, and that the inspection is
limited to a situation where there was a Federal construction license
or permit and a subsequent Federal operating license or permit was not
required. The 1971 Rule set forth the procedure regarding inspection
and subsequent inspection findings; however, these regulations only
applied where EPA was the certifying authority. See 40 CFR 121.26
through 121.28 (2019). The 2020 Rule interpreted section 401(a)(4) to
apply to all certifying authorities. It also expanded the ability to
conduct inspections pursuant to section 401(a)(4) to any certified
project where the Federal license or permit and certification were
issued prior to operation, instead of only for projects where there was
a Federal construction license or permit and a subsequent Federal
operating license or permit was not required. 40 CFR 121.11(a) (2020);
85 FR 42277. In pre-proposal input, several stakeholders pressed the
Agency to allow for inspections before, during, and post-operation.
EPA is removing Sec. 121.11(a) and (b) from the 2020 Rule in this
final rule because the 2020 Rule incorrectly interpreted the limited
applicability of section 401(a)(4) and the statutory language does not
need further clarification. A few commenters recommended that the
Agency add regulatory text regarding section 401(a)(4). However, the
Agency finds that the statute clearly outlines the inspection
authorities available under section 401. On its face, section 401(a)(4)
applies to a limited circumstance where a Federal license or permit and
certification are issued prior to operation of the facility or activity
and a subsequent Federal operating license or permit is not necessary
for the facility or activity to operate. Under these limited
circumstances, the statute is clear that the licensee or permittee must
provide the certifying authority with the ability to ``review'' the
facility or activity to determine whether it will comply with effluent
limitations, other limitations, or other water quality requirements.
EPA interprets the term ``review'' found in section 401(a)(4) as broad
enough to include inspection, but it is not necessarily limited to
inspection. It arguably also includes the right to review preliminary
monitoring reports or other such records that can assist the certifying
authority in determining whether the operation of the facility or
activity will comply with effluent limitations, other limitations, or
other water quality requirements. EPA requested comment on whether it
should articulate this interpretation of section 401(a)(4) in
regulatory text. A few commenters recommended that EPA adopt regulatory
text regarding its proposed interpretation of the term ``review'' found
in section 401(a)(4). After considering public comments, however, EPA
finds it unnecessary to add regulatory text defining the term
``review'' as used in section 401(a)(4).
EPA emphasizes that section 401(a)(4) does not necessarily limit
the certifying authority's ability to inspect facilities or activities
before or during operation in accordance with the certifying
authority's laws and regulations. The Agency is aware that states and
Tribes may have their own authority to inspect a facility or activity
to determine compliance with conditions set forth in a section 401
certification. Similarly, section 401(a)(4) does not necessarily limit
a Federal agency's ability to inspect a facility during the life of the
license or permit pursuant to that Federal agency's laws and
regulations.
K. Neighboring Jurisdictions
1. What is the Agency finalizing?
The Agency is finalizing its proposed approach to the section
401(a)(2) process, referred to as the neighboring jurisdictions
process, with some modifications to the regulatory text for clarity.
See 40 CFR part 121, subpart B.
The Agency is adding text to Sec. 121.12 of the final rule, which
provides the contents of a notification to the Regional Administrator,
to clarify that Federal licensing and permitting agencies notify EPA
upon receipt of a Federal license or permit application \96\ and
certification or waiver by providing written notification to the
``appropriate'' Regional Administrator. EPA is also modifying the
proposed text of Sec. 121.13, which provided that a Federal license or
permit ``may not be issued pending the conclusion of the process
described'' in Sec. Sec. 121.14 and 121.15, to more clearly state that
a Federal license or permit ``shall not be issued pending the
conclusion of the process described'' in Sec. 121.13 (EPA's
determination of effects on neighboring jurisdictions) as well as
Sec. Sec. 121.14 and 121.15.\97\
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\96\ See section IV.C.2 of the preamble regarding the
expectation that the Federal license or permit application be
complete. See section IV.K.2 of this preamble infra for further
discussion about the contents of the Federal agency's notification
to EPA.
\97\ See section IV.K.2.d. of this preamble infra for further
discussion of the requirement for the neighboring jurisdictions
process to conclude before issuance of a license or permit by a
Federal agency.
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For purposes of language consistency and clarity, the Agency
removed ``certified or waived'' from the proposed language of Sec.
121.13(a), which stated that ``[w]ithin 30 days after the Regional
Administrator receives notice in accordance with Sec. 121.12(a), the
Regional Administrator shall determine whether a discharge from the
certified or waived project may affect water quality in a neighboring
jurisdiction.'' The removal of ``certified or waived'' is intended to
remove redundancy, as Sec. 121.12(a) already states that the Federal
agency shall provide written notification to the appropriate Regional
Administrator ``[w]ithin five days of the date that it has received
both the application and either a certification or waiver for a Federal
license or permit,'' and to ensure conformity of the use of ``discharge
from the project'' across subpart B.
Additionally, EPA is finalizing most of Sec. 121.13(c), which
provides the contents of the Regional Administrator's may affect
notification, as proposed, except the Agency is revising the proposed
language in Sec. 121.13(c)(3) to conform the statement that the Agency
provides to notified neighboring jurisdictions more closely with the
statutory text of section 401(a)(2) and provide greater clarity about
notification needed for an objection. Rather than providing a statement
that the notified neighboring jurisdiction ``has 60 days'' to provide
written notification ``whether it has determined that the discharge
will violate any of its water quality requirements,'' as proposed in
Sec. 121.13(c)(3), the final rule states that the Agency provides a
statement that the notified neighboring jurisdiction ``has 60 days
after such notification'' from the Agency to provide written
notification ``if it has determined that the discharge will violate any
of its water quality requirements.'' 40 CFR 121.13(c)(3). This revision
more closely reflects the statutory text of section 401(a)(2) which
provides that a notified neighboring jurisdiction may object to
issuance of a Federal license or permit ``[i]f, within sixty days after
receipt'' of notification from the Agency it ``determines that such
discharge will affect the quality of its waters so as to violate any
water quality requirements.'' 33 U.S.C. 1341(a)(2). As a result, the
text of Sec. 121.13(c)(3) of the final rule also more clearly conveys
the statutory time
[[Page 66636]]
and content requirements of the notification needed for an objection
than the proposed regulatory text.
EPA is also modifying the proposed text of Sec. Sec. 121.13 and
121.14 to remove language requiring the Administrator and notified
neighboring jurisdiction to provide notification to the certifying
authority during the neighboring jurisdictions process, to more closely
reflect the statutory language in section 401(a)(2), which does not
require such notification to the certifying authority in this process.
Further, the Agency is modifying the proposed text of Sec. Sec.
121.14 and 121.15 to clarify that references to a ``neighboring
jurisdiction'' in these provisions refer to a ``notified'' neighboring
jurisdiction, meaning a neighboring jurisdiction that has received
notification that the Regional Administrator has determined that a
discharge from the project may affect the neighboring jurisdiction's
water quality. The proposed text of Sec. 121.14(a) referenced notice
being provided to a neighboring jurisdiction ``in accordance with Sec.
121.13(c),'' and the language in Sec. Sec. 121.14 and 121.15 referred
to ``the neighboring jurisdiction'' or ``a neighboring jurisdiction''
without more explicitly stating that the provisions were addressing
``notified'' neighboring jurisdictions. In the final rule, EPA is
revising the internal citation in Sec. 121.14(a) to more appropriately
reference Sec. 121.13(b), the provision in the final rule requiring
the Regional Administrator to provide notification upon determining
that discharge from the project may affect water quality in a
neighboring jurisdiction. Likewise, EPA is revising the ``neighboring
jurisdiction'' references in Sec. Sec. 121.14 and 121.15 to specify
that these refer to a ``notified'' neighboring jurisdiction, to remove
ambiguity and improve clarity in these sections.
The Agency is also adding language to the provision in Sec. 121.15
to clarify the process for the Federal agency to provide notice of a
hearing on a section 401(a)(2) objection, and provide greater
transparency as to how Federal agencies provide such notification. The
proposed text of Sec. 121.15(b) required the Federal agency conducting
a hearing on an objection from a neighboring jurisdiction to ``provide
public notice at least 30 days in advance of the hearing.'' In the
final rule, Sec. 121.15(b) requires the Federal agency in such
circumstances to ``provide public notice at least 30 days in advance of
the hearing to interested parties, including but not limited to the
neighboring jurisdiction, the certifying authority, the project
proponent, and the Regional Administrator.'' This addition clarifies
that that such notice must go to interested parties to ensure that they
can prepare for and provide their testimony or comments at the public
hearing. It further provides a greater level of transparency regarding
how all Federal licensing or permitting agencies will provide public
notice of a hearing on an objection.
Additionally, for purposes of improving the efficiency and clarity
of the neighboring jurisdictions process in circumstances where a
notified neighboring jurisdiction seeks to withdraw a previously issued
objection, EPA is adding text in Sec. Sec. 121.14 and 121.15 of the
final rule to allow for withdrawal of an objection in these
circumstances. Specifically, Sec. 121.14(c) of the final rule provides
that ``[t]he notified neighboring jurisdiction may withdraw its
objection prior to the public hearing. If the notified neighboring
jurisdiction withdraws its objection, it shall notify the Regional
Administrator and the Federal agency, in writing, of such withdrawal.''
Consistently, EPA is adding text to Sec. 121.15(a) of the final rule,
providing that the Federal licensing or permitting agency shall hold a
public hearing on the notified neighboring jurisdiction's objection
``unless the objection is withdrawn in accordance with Sec.
121.14(c).'' As discussed further below, EPA finds that including a
provision addressing withdrawal of an objection improves the efficiency
of the neighboring jurisdictions process, as it recognizes the
possibility that neighboring jurisdictions may be able to resolve
objections before the hearing stage of the neighboring jurisdictions
process, and conserves resources that would otherwise be expended to
conduct and participate in such a hearing in these circumstances.
Additionally, the added text regarding withdrawal of an objection in
Sec. Sec. 121.14 and 121.15 of the final rule add clarity by
establishing a uniform procedure for executing withdrawal of an
objection.
As discussed in greater detail below, EPA is finalizing its
proposed approach to the definition of neighboring jurisdiction, the
scope of the neighboring jurisdictions process, the circumstances
initiating the neighboring jurisdictions process, and the timing in
which a Federal licensing or permitting agency must provide
notification to EPA pursuant to section 401(a)(2). The Agency is also
maintaining its previously stated positions regarding the roles of the
Federal licensing or permitting agency, EPA, and a neighboring
jurisdiction in the neighboring jurisdictions process, but is providing
some further discussion regarding certain aspects of these roles below
to provide added clarity.
2. Summary of Final Rule Rationale and Public Comment
a. Definition of Neighboring Jurisdiction
The Agency is finalizing the definition of neighboring jurisdiction
at Sec. 121.1(g) as proposed. This final rule revises the definition
of this term used in the 2020 Rule to clarify that it includes ``any
state, or Tribe with treatment in a similar manner as a state for Clean
Water Act section 401 in its entirety or only for Clean Water Act
section 401(a)(2), other than the jurisdiction in which the discharge
originates or will originate.'' See 40 CFR 121.1(g). In contrast, the
definition of ``neighboring jurisdiction'' in the 2020 Rule
inaccurately suggested that a neighboring jurisdiction may only include
a state or TAS Tribe that EPA determines may be affected by a discharge
from another jurisdiction. 40 CFR 121.1(i) (2020). As EPA noted in the
proposed rule, a neighboring jurisdiction's status is not based upon
EPA's ``may affect'' determination, but rather a neighboring
jurisdiction has this status by being a jurisdiction other than the one
where the discharge originates or will originate. Thus, the current
definition is more consistent with the statutory text establishing the
process set forth in section 401(a)(2) for purposes of considering the
water quality effects to ``any other state'' than the previous
definition for the 2020 Rule. The current definition also reflects the
TAS provisions for Indian Tribes to administer section 401 that are
being finalized in Sec. 121.11.
A few commenters addressing the definition of neighboring
jurisdiction in the proposed rule advocated for EPA to adopt a narrower
definition of this term. EPA finds that a narrower definition of
neighboring jurisdiction is not supported by the statutory text in
section 401(a)(2), which establishes a process for considering water
quality effects to ``any other state.'' This statutory language does
not impose any other requirement on a neighboring jurisdiction other
than not being the jurisdiction in which the discharge originates or
will originate, meaning the jurisdiction with certifying authority.
Accordingly, EPA declines to adopt a narrower definition of neighboring
jurisdiction. Additionally, EPA notes that the definition of
neighboring jurisdiction makes clear that this term is not limited to
adjacent or downstream states or Tribes with TAS for section 401,
consistent with the relevant statutory language in section 401(a)(2).
[[Page 66637]]
b. Scope of the Neighboring Jurisdictions Process
The Agency is also maintaining in the final rule the interpretation
of the scope of section 401(a)(2) stated in the proposed rule. In the
proposed rule, EPA interpreted the scope of section 401(a)(2) as
limited by the statutory language to considering potential effects only
from a ``discharge'' from an activity, explaining that this is based
upon the statutory language in section 401(a)(2) which limits EPA to
considering whether a ``discharge'' from an activity may affect the
water quality of a neighboring jurisdiction, and likewise limits a
neighboring jurisdiction to determining whether a ``discharge'' from
the activity will affect its water quality so as to violate any water
quality requirements. 87 FR 35365 (June 9, 2022). A few commenters
observed that EPA's proposed interpretation of the scope of section
401(a)(2) differed from its proposed interpretation of the scope for
certification, and one such commenter asserted that EPA's differing
interpretations of scope for certification and the neighboring
jurisdictions process in section 401(a)(2) is arbitrary. EPA disagrees.
The neighboring jurisdictions process established in section
401(a)(2) is distinct from the process for certification, which is a
prior step in the statutory regime. Whereas the text of section
401(a)(1) and section 401(d) refers to a ``certification'' of
compliance with water quality requirements, the text of section
401(a)(2) does not refer to the actions taken by the Administrator or a
neighboring jurisdiction as ``certifications.'' Instead, the text of
section 401(a)(2) is clear that the neighboring jurisdictions process
is distinct from, and follows after, a ``certification'' made pursuant
to section 401(a)(1) and section 401(d). EPA rejects the assertion that
the scope of the neighboring jurisdictions process in section 401(a)(2)
must be the same as the scope of certification, as there are different
statutory provisions relating to certification and the neighboring
jurisdictions process, and interpreting them the same would not be
consistent with the language of these distinct statutory provisions.
Section 401(d), which is key to EPA's conclusion regarding scope of
certification, applies only to certification and not to the neighboring
jurisdictions process established in section 401(a)(2). Likewise, the
Supreme Court's reasoning in PUD No. 1 regarding the proper scope of
certification (which EPA agrees with) does not extend to the
neighboring jurisdictions process in section 401(a)(2).
In contrast to statutory language pertaining to certification,
which supports a broader scope, the text of section 401(a)(2)
establishes that the Administrator and notified neighboring
jurisdictions consider the potential discharges of the project.
Specifically, pursuant to section 401(a)(2) the Administrator considers
whether ``such a discharge'' may affect the water quality of a
neighboring jurisdiction, and likewise, a notified neighboring
jurisdiction considers whether ``such discharge'' will affect its water
quality so as to violate water quality requirements. EPA interprets
this language as limiting the neighboring jurisdictions process to
discharges from the project. One commenter asserted that the scope of
section 401(a)(2), outlining the neighboring jurisdictions process, is
the same as section 401(a)(1), relating to certification, because
section 401(a)(2) is inextricably linked to section 401(a)(1) through
the use of ``such'' referring to the scope of discharges addressed in
section 401(a)(1).
While EPA agrees that the ``such'' language employed in section
401(a)(2) refers to discharges from ``any activity'' subject to
certification pursuant to section 401(a)(1), the Agency does not
conclude that section 401(a)(1) compels the scope of the neighboring
jurisdictions process to be the same as the scope of certification. As
discussed above, the scope of certification is based, in part, upon
statutory text within both section 401(a)(1) and section 401(d), and
nothing in either of these statutory provisions or section 401(a)(2)
compels the neighboring jurisdictions process to have the same scope as
certification. This interpretation is also consistent with the
legislative history regarding the neighboring jurisdictions process.
The text of the neighboring jurisdictions process in the Water Quality
Improvement Act of 1970 (in section 21(b)(2)) used ``such a discharge''
and ``such discharge'' language later employed in section 401(a)(2),
even though the 1970 act used the term ``activity'' in place of
``discharge'' in what is now section 401(a)(1). The ``discharge''
language for the neighboring jurisdictions process remained unchanged
during the 1972 amendments that changed the language regarding
certification from ``such activity'' to ``such discharge'' in CWA
section 401(a)(1). The fact that the ``discharge'' language in section
401(a)(2) remained consistent throughout amendments supports that
Congress intended the scope of the neighboring jurisdictions process to
consider ``discharges,'' and it adopted and maintained a statutory
regime with differing scopes for certification and the neighboring
jurisdictions process.
EPA's interpretation of the scope of the neighboring jurisdictions
process is further supported by procedural differences between this
process and certification. Several procedural differences reflect a
more limited authority for notified neighboring jurisdictions than that
of certifying authorities. A more limited scope of review is consistent
with the more limited nature of the neighboring jurisdictions process.
As discussed further below, neighboring jurisdictions only receive
notification under section 401(a)(2) when EPA determines that a
discharge from the project may affect their water quality, unlike
section 401(a)(1) certification where the project proponent for the
Federal license or permit must request certification from the
certifying authority regardless of the known or suspected potential
impacts to water quality. Likewise, notified neighboring jurisdictions
determine whether discharge from the project will affect the quality of
their waters so as to violate any water quality requirements, a
standard inverse to that of a certifying authority determining if it
can certify compliance with water quality requirements pursuant to
section 401(a)(1). This distinction matters because the neighboring
jurisdiction must make an affirmative case to support a ``will affect''
determination, a higher bar than that of a certifying authority, which
could deny certification because of a lack of information supporting a
conclusion that the activity will comply with water quality
requirements. Additionally, in contrast to the certification decision
made by the certifying authority, the outcome of the neighboring
jurisdictions process following a hearing is determined by the Federal
licensing or permitting agency, based upon the recommendations of the
neighboring jurisdiction and EPA, and any additional information
presented at the hearing. Taken together, these procedural distinctions
reflect a more limited authority for notified neighboring jurisdictions
in the neighboring jurisdictions process than the role of a certifying
authorities, which supports EPA's interpretation finding a more limited
scope for the neighboring jurisdictions process.
In addition to the differences between the extent of authority of a
notified neighboring jurisdiction and a certifying authority, the
statutory text of section
[[Page 66638]]
401 also reflects differences in the timing of the neighboring
jurisdictions process compared to the timing of certification, which
likewise support EPA's interpretation of differing scopes for these
steps. In the neighboring jurisdictions process, both EPA and notified
neighboring jurisdictions are provided less time to make determinations
regarding the water quality effects to a neighboring jurisdiction (30
days and 60 days, respectively) than a certifying authority has for
acting on a request for certification (up to a year). The difference in
the timing of determinations at these steps supports differing scopes,
as it may be possible for EPA and notified neighboring jurisdictions to
complete determinations in the more limited time provided for in the
neighboring jurisdictions process based upon a more discrete analysis
focused on discharges.
c. Circumstances Initiating the Neighboring Jurisdictions Process
The Agency is finalizing its proposed approach to clarify that both
grants of certification (with or without conditions) and waivers of
certification initiate the neighboring jurisdictions process
established by section 401(a)(2). Section 401(a)(2) provides that the
Federal licensing or permitting agency must immediately notify the EPA
Administrator upon receipt of a Federal license or permit application
and certification. 33 U.S.C. 1341(a)(2). Under the 1971 Rule, EPA's
section 401(a)(2) review was initiated upon receipt of either a
certification or a waiver, which was treated as a substitute for
certification. See 40 CFR 121.11, 121.16 (2019). In the 2020 Rule,
EPA's section 401(a)(2) review was initiated only upon receipt of a
certification. 40 CFR 121.12(a) (2020); see 85 FR 42287 (July 13,
2020). Additionally, the 2020 Rule further provided that a Federal
agency may issue a license or permit upon issuance of a written notice
of waiver. 40 CFR 121.9(e) (2020). As proposed, EPA is returning to the
approach taken in the 1971 Rule that the neighboring jurisdictions
process is initiated by either a certification or waiver.
Although the statutory text does not explicitly identify waiver of
certification as an action that initiates the neighboring jurisdictions
process in section 401(a)(2),\98\ the Agency maintains that it is
reasonable to interpret the waiver of certification as a substitute for
a grant of certification for purposes of section 401(a)(2) review for
several reasons. First, this treatment is consistent with the purpose
of section 401(a)(2). Section 401(a)(2) provides a mechanism for a
notified neighboring jurisdiction to object to the issuance of a
Federal license or permit when it determines that discharge from a
project originating in another jurisdiction will affect the quality of
its waters thus violating its water quality requirements. A waiver does
not indicate a certifying authority's substantive opinion regarding the
water quality implications (for itself or another jurisdiction) of a
project subject to Federal licensing or permitting. Rather, a
certifying authority may affirmatively waive certification for a
variety of reasons, including a lack of resources to evaluate the
project. In addition, a certifying authority may be deemed to have
waived certification if that certifying authority fails or refuses to
act on a request for certification before the end of the reasonable
period of time. See section IV.F of this preamble for further
discussion on waivers of certification. Ultimately a waiver of
certification allows the Federal licensing or permitting agency to
issue its license or permit without receipt of a water quality
certification. As a result, a waived certification could result in
water quality impacts that might violate a neighboring jurisdiction's
water quality requirements. It is reasonable to afford a mechanism for
EPA and a neighboring jurisdiction to evaluate that possibility.
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\98\ See 33 U.S.C. 1341(a)(2) (``Upon receipt of such
application and certification the licensing or permitting agency
shall immediately notify the Administrator of such application and
certification.'') (emphasis added).
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Second, the approach taken under the 2020 Rule to exclude waivers
from the neighboring jurisdictions process created a method for
certifying authorities to circumvent the neighboring jurisdictions
process in circumstances where they are aware of water quality concerns
from a neighboring jurisdiction regarding a project. As noted above,
EPA finds that section 401(a)(2) was established as a mechanism to
allow notified neighboring jurisdictions an opportunity to object to
the issuance of a Federal license or permit in circumstances where they
find a discharge from the licensed or permitted project will violate
their water quality requirements. EPA does not find that the statutory
language of section 401(a)(2) supports such circumvention of the
neighboring jurisdictions process, as this would thwart the very
purpose of the process established by the statutory text.
Finally, including waivers as actions initiating the neighboring
jurisdictions process was the Agency's position for over 50 years prior
to the 2020 Rule. See 40 CFR 121.16 (2019). The final rule provides
clarification on when waiver of certification has occurred, allowing
Federal agencies to provide EPA notice of the Federal license or permit
application and waiver as required by Sec. 121.12 of the final rule.
Therefore, consistent with the approach taken in the 1971 Rule, the
Agency is restoring the interpretation that waivers, in addition to
certifications, initiate the neighboring jurisdictions process
established in section 401(a)(2).
Accordingly, in Sec. 121.12(a) of the final rule, the Agency is
clarifying that the neighboring jurisdictions process is initiated when
the Federal agency ``has received both the application and either a
certification or waiver for a Federal license or permit,'' and must
provide notice to EPA. Additionally, as proposed, the Agency is
removing the regulatory provision located at Sec. 121.9(e) of the 2020
Rule, which provided that a Federal agency may issue a license or
permit upon issuance of a written notice of waiver. As discussed above,
under this final rule waivers of certification also initiate the
neighboring jurisdictions process and EPA may make a ``may affect''
determination based upon a waiver of certification. See 40 CFR
121.12(a). Consistent with the language at Sec. 121.13(d) of the final
rule, a Federal agency shall not issue a Federal license or permit
pending the conclusion of the neighboring jurisdictions process.
Several commenters provided input on the proposed approach to have
waiver initiate the neighboring jurisdictions process. A few commenters
agreed that a waiver should initiate the neighboring jurisdictions
process and asserted that this approach would improve the neighboring
jurisdictions process. Conversely, a few other commenters argued that a
waiver should not initiate the neighboring jurisdictions process and
asserted that that there is no statutory basis for the inclusion of
waivers in this process. One of these commenters added that expanding
the notification process beyond what the statute provides would lead to
needless process and delays.
EPA disagrees with the assertion that the statute does not support
waiver initiating the neighboring jurisdictions process established in
section 401(a)(2). As explained above, EPA is interpreting waiver of
certification as a substitute for a grant of certification for purposes
of section 401(a)(2) based upon the purpose of this statutory
provision.\99\
[[Page 66639]]
Employing a more restrictive interpretation would otherwise allow
certifying authorities to circumvent the neighboring jurisdictions
process by waiving certification on projects affecting the water
quality of neighboring jurisdictions, which is counter to the purpose
of the process established in section 401(a)(2). Additionally, EPA also
does not agree that this interpretation will result in unnecessary
delays for Federal licensing or permitting because the statute limits
the time EPA and the notified neighboring jurisdiction have to respond
to a notification (30 days and 60 days, respectively). Further, as the
process established by section 401(a)(2) provides an important
mechanism for notified neighboring jurisdictions to meaningfully engage
with Federal agencies on objections where they find a discharge from a
project will violate their water quality requirements, EPA does not
find this approach results in unreasonable process.
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\99\ In fact, the language in section 401(a)(1) describes
waivers of certification as a substitute for a granted certification
because the Federal licensing or permitting agency is unable to
proceed with their licensing or permitting process ``until the
certification required by [section 401(a)(1)] has been obtained or
has been waived.'' 33 U.S.C. 1341(a)(1). By listing the two
scenarios under which the process continues, it is reasonable to
consider a waiver of certification as a substitute for a
certification.
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d. Neighboring Jurisdictions Process Must Conclude Before Federal
License or Permit Issuance
The proposed text of Sec. 121.13(d) included language intended to
explain that the neighboring jurisdictions process must conclude before
a Federal agency issues a license or permit, stating that ``[a] Federal
license or permit may not be issued pending the conclusion of the
process described in Sec. Sec. 121.14 and 121.15.'' This proposed text
retained language similar to Sec. 121.12(c) of the 2020 Rule, which
stated that ``[t]he federal license or permit may not be issued pending
the conclusion of the processes.'' 40 CFR 121.12(c) (2020). The Agency
is modifying the proposed text of Sec. 121.13 to more clearly state
that a Federal agency is prohibited from issuing a license or permit
subject to section 401 certification pending conclusion of the
neighboring jurisdictions processes addressed in Sec. Sec. 121.13,
121.14, and 121.15. Specifically, EPA changed the proposed text of
Sec. 121.13(d) from providing that the Federal license or permit ``may
not be'' issued pending the conclusion of the neighboring jurisdictions
process to more directly stating that the Federal license or permit
``shall not be'' issued pending the conclusion of the neighboring
jurisdictions process. Further, EPA modified the text of Sec. 121.13
to make clear that the neighboring jurisdictions process includes the
processes described in Sec. Sec. 121.13, 121.14, and 121.15. These
changes are consistent with the proposed regulatory text, but provide
further clarity that pursuant to Sec. 121.13, and the statutory text
of section 401(a)(2), a Federal agency cannot proceed with issuing its
license or permit until the neighboring jurisdictions process set forth
in Sec. Sec. 121.13, 121.14, and 121.15 has concluded.
In practical terms, this means that Federal agencies must wait to
issue a Federal license or permit until the neighboring jurisdictions
process has concluded. The neighboring jurisdictions process may
conclude in several different ways, depending on factual and procedural
circumstances. One way the neighboring jurisdictions process concludes
occurs when the appropriate Regional Administrator has completed the
``may affect'' determination within 30 days after receiving notice from
the Federal agency, pursuant to Sec. 121.13(a), without making a ``may
affect'' finding. In such circumstances, the neighboring jurisdictions
process has concluded, and the Federal agency may proceed with issuing
the Federal license or permit without waiting for further proceedings.
In contrast, when the appropriate Regional Administrator completes
the ``may affect'' determination by making a ``may affect'' finding and
provides notification of this finding pursuant to Sec. 121.13(b), the
Federal agency must wait to issue the Federal license or permit until
the notified neighboring jurisdiction has made a ``will violate''
determination, pursuant to Sec. 121.14, within 60 days of the
notification from EPA pursuant to Sec. 121.13, or this time period has
passed. Where a notified neighboring jurisdiction has determined that a
discharge will violate its water quality requirements and has provided
notification of its objection and request for hearing pursuant to Sec.
121.14(a) and (b), the Federal agency cannot issue the license or
permit until either the public hearing process described in Sec.
121.15 is completed, or the notified neighboring jurisdiction withdraws
its objection pursuant to Sec. 121.14(c).
A few commenters raised concerns regarding the neighboring
jurisdictions process delaying the issuance of Federal licenses or
permits. Additionally, a commenter asserted that EPA should consider
only requiring the neighboring jurisdictions process for larger,
complex individual permit projects because of wide-ranging implications
of this process. The Agency notes that the neighboring jurisdictions
process is a component of the section 401 statutory regime established
by section 401(a)(2) and is not a regulatory creation by EPA.\100\
Moreover, as section 401(a)(2) sets timelines for certain actions in
the neighboring jurisdictions process, it is clear from the statutory
text that Congress considered the timing of this process when it was
established. As discussed further below, EPA is adding clarity
regarding the procedures involved in the neighboring jurisdictions
process in the final rule, which are intended to improve efficiency and
reduce the time necessary for this process. EPA also finds no basis in
the statutory text supporting an exception to this process for general
permits or less complex individual permits. Instead, the type of
project and discharge covered in the Federal license or permit are
factors that may be considered by EPA and any notified neighboring
jurisdictions in their determinations regarding the water quality
effects of a discharge from a project in the neighboring jurisdictions
process.
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\100\ Several commenters suggested that the neighboring
jurisdictions process resulted, in part, from the 1971 Rule. As
discussed, the statutory text of section 401(a)(2) establishes this
process.
---------------------------------------------------------------------------
e. Federal Licensing or Permitting Agency's Role in Initiating the
Neighboring Jurisdictions Process
Section 401(a)(2) requires the Federal licensing or permitting
agency to notify EPA immediately upon receipt of a Federal license or
permit application and the related section 401 water quality
certification. 33 U.S.C. 1341(a)(2). This notification from the Federal
agency commences the remaining steps of the neighboring jurisdictions
process addressed in section 401(a)(2) and discussed in Sec. Sec.
121.13, 121.14, and 121.15 of the final rule. The 1971 Rule established
some procedural requirements for this notification process, which EPA
updated in the 2020 Rule. The 2020 Rule included additional specificity
on the timing of Federal agency notification but did not contain a
standardized process for notification. 40 CFR 121.12(a) (2020).
Instead, under the 2020 Rule, EPA relied on Federal agencies to develop
notification processes and procedures that work within their licensing
or permitting programs. 85 FR 42273.
In the proposed rule, the Agency likewise proposed regulatory text
to
[[Page 66640]]
provide clarity regarding the timing by which a Federal agency must
provide notification to EPA pursuant to section 401(a)(2), and further
proposed additional procedures for Federal agencies to follow when
providing notification to EPA. In the final rule, EPA is maintaining
its interpretation of the timing for Federal agencies to provide
notification pursuant to the statutory text in section 401(a)(2), and
otherwise finalizing the proposed procedures for Federal agencies to
follow when providing notification to EPA with some minor changes to
the text of Sec. 121.12 and the deletion of the definition of
``application'' proposed at Sec. 121.1(c).
i. Timing of Notice From a Federal Agency
As noted, to initiate the neighboring jurisdictions process, a
Federal licensing or permitting agency must ``immediately'' notify EPA
when it receives a Federal license or permit application and a section
401 certification. 33 U.S.C. 1341(a)(2). EPA is finalizing its proposed
interpretation of ``immediately'' to mean within five calendar days of
the Federal agency's receipt of the application for a Federal license
or permit and either receipt of certification or waiver. This approach
retains the same interpretation of ``immediately'' used in the 2020
Rule. 40 CFR 121.12(a) (2020); see 85 FR 42273.
EPA is also finalizing the regulatory text in Sec. 121.12(a) of
the final rule providing that ``[w]ithin five days of the date that it
has received both the application and either a certification or waiver
for a Federal license or permit, the Federal agency shall provide
written notification to the appropriate Regional Administrator.'' EPA
is finalizing this provision with only minor changes from the proposal
for added clarity. Specifically, EPA added language to specify that the
Federal agency shall provide the written notification to the
``appropriate'' Regional Administrator, but otherwise maintained the
proposed text providing that the period for the Federal agency to
provide such notification commences upon ``the date that it has
received both the application and either a certification or waiver.''
See 87 FR 35380.
As previously discussed, this provision reflects EPA's
interpretation that the neighboring jurisdictions process set forth in
section 401(a)(2) is initiated by either certification or waiver. See
supra for further discussion on actions initiating the neighboring
jurisdictions process. It further makes clear that the Federal agency
is only considered to be in receipt of an application for a Federal
license or permit and certification within the meaning of section
401(a)(2) when such agency has received both an application for a
Federal license or a permit, as discussed above, and has either
received a corresponding certification or a waiver has occurred.\101\
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\101\ Although this statutory language is unambiguous, EPA is
further discussing when receipt occurs due to questions and
conflicting practices among Federal licensing and permitting
agencies. For example, some Federal agencies provide notice to EPA
concurrently with its public notice on the licensed or permitted
application, see, e.g., 33 CFR 325.2(b)(1)(i) (``The public notice
for such activity . . . will serve as the notification to the
Administrator . . . pursuant to section 401(a)(2) of the Clean Water
Act.''). Such practices are not consistent with the statutory
language or this final rule. It is necessary that certification or
waiver occur for EPA to make a determination as to whether a
discharge from the activity ``may affect'' the water quality of a
neighboring jurisdiction under section 401(a)(2), as EPA only makes
such a determination where certification or waiver has occurred, and
considers any conditions included in a certification in making this
determination.
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EPA received several comments on its proposal to retain the five-
day interpretation of ``immediately'' in the context of section
401(a)(2). A few commenters agreed with EPA maintaining the five-day
interpretation of immediately, asserting that this period was adequate
for such notice and consistent with the statutory language. However,
one commenter argued that providing Federal agencies with five calendar
days to notify EPA is an unrealistic timeframe, and asked EPA to
consider interpreting ``immediately'' as five business days or ten
calendar days. EPA disagrees that the five-day period is unrealistic.
EPA did not encounter significant challenges in implementing this
interpretation in the 2020 Rule. The Agency finds five days a prompt
yet reasonable amount of time for Federal agencies to complete
notification to EPA pursuant to section 401(a)(2). This interpretation
reflects the urgency connotated in the statutory language of section
401(a)(2), while also recognizing that the Federal agency needs some
amount of time to process receipt of the Federal license or permit
application and certification or waiver from the project proponent or
certifying authority, and then transmit notice to the appropriate EPA
regional office. Additionally, EPA finds that this approach provides
clarity to Federal agencies regarding the timing of notification to EPA
pursuant to section 401(a)(2), and also ensures consistency in
practices across Federal licensing and permitting agencies.
Several commenters discussed the proposed language, finalized in
Sec. 121.12(a) of the final rule, which establishes that a Federal
agency's obligation to provide notification to EPA only commences upon
the Federal agency's receipt of both the Federal license or permit
application and either certification or waiver. One commenter agreed
with this approach, noting that the Agency's clarification on this
point will ensure that EPA and neighboring jurisdictions have necessary
information to make determinations within the neighboring jurisdictions
process, and that this otherwise addresses confusion and information
gaps caused by prior inconsistent information sharing practices. A few
commenters, however, suggested that the Federal agency should be able
to provide notification to EPA prior to receipt of certification, such
as upon a receipt of an application for a Federal license or permit and
a request for certification. One such commenter argued that requiring
the Federal agency to be in receipt of both the Federal license or
permit application and certification before notifying EPA would
increase delays in the Federal licensing or permitting process. EPA
disagrees that notification provided by a Federal agency prior to
receipt of certification satisfies the notification requirement in
section 401(a)(2), as this is inconsistent with the statutory language,
which provides that the Federal agency shall provide notification
``[u]pon receipt of such application and certification.'' As a result,
notification prior to receipt of certification or waiver would not be
sufficient to satisfy a Federal agency's obligation pursuant to section
401(a)(2). Furthermore, EPA disagrees that notification after a Federal
agency receives a certification decision will increase delays in the
Federal licensing or permitting process. Rather, a certification
decision may render the need to notify EPA under section 401(a)(2) moot
(i.e., denial) or it may inform EPA's analysis for its ``may affect''
determination and make it unnecessary to make a ``may affect'' finding
(i.e., a certification with conditions).
A few commenters argued that requiring Federal agencies to provide
notification to EPA after receipt of a certification precluded Federal
agencies from providing notification to EPA earlier (e.g., after
receipt of an application for a Federal license or permit), therefore
prohibiting Federal agencies from engaging in early coordination with
EPA. However, this is not correct. Nothing in the proposed text, or
final rule, prevents a Federal agency from providing notification to
EPA of a Federal license or permit
[[Page 66641]]
application for purposes of early coordination. Rather, such notice for
coordination purposes does not satisfy the requirement that the Federal
agency provide notification to EPA upon receipt of the Federal license
or permit application and certification or waiver, pursuant to Sec.
121.12 of the final rule, and would not commence the 30-day period for
EPA's ``may affect'' determination pursuant to section 401(a)(2). Thus,
EPA is providing this clarification in the final rule.
With regard to the meaning of ``application'' for purposes of
section 401(a)(2), the Agency is maintaining the position stated in the
proposed rule that within this context the term ``application'' is used
to refer to the ``application for such Federal license or permit.'' See
87 FR 35366. Section 401 uses the term ``application'' throughout
section 401(a); however, when read in context, the term is used for
both ``applications for certification'' and ``applications for such
Federal license or permit.'' 33 U.S.C. 1341(a)(1)-(2). The Agency
considers the ``request for certification'' to be an ``application for
certification.'' See section IV.C in this preamble for further
discussion on request for certification. The context of the relevant
statutory language in section 401(a)(2), directing the Federal agency
to provide notification to EPA ``[u]pon receipt of such application and
certification,'' reflects that this use of the term ``application''
refers to ``application for such Federal license or permit,'' rather
than ``application for certification.'' Id. at 1341(a)(2). Accordingly,
the obligation for the Federal agency to provide notification to EPA
pursuant to section 401(a)(2) is initiated upon receipt of both a
Federal license or permit application and either a section 401
certification or a waiver of certification.
In the proposed rule, EPA noted that there are instances where a
Federal license or permit application does not accompany a
certification or waiver, and therefore proposed to define the term
``application'' to mean ``an application for a license or permit
submitted to a Federal agency, or if available, the draft license or
permit'' to account for differing Federal licensing or permitting
practices. EPA received a few comments related to this definition in
the context of the Federal agency providing notification to EPA
pursuant to section 401(a)(2). One commenter argued that EPA should not
require the Federal agency to have a draft Federal license or permit
when it notifies EPA under the neighboring jurisdictions process. In
contrast, another commenter supported draft Federal licenses or permits
being included in notification to EPA where such drafts are provided
before a certification decision. However, as previously discussed, in
the context of requests for certification, many commenters opposed to
EPA's proposed approach of requiring the project proponent to include
the draft Federal license or permit in all requests for certification.
As a result, EPA is finalizing a bifurcated approach. A project
proponent seeking certification on the issuance of a general license or
permit must submit a copy of the draft Federal license or permit in its
request for certification. A project proponent seeking certification on
an individual license or permit must submit a copy of the Federal
license or permit application in its request for certification. See
section IV.C in this preamble for discussion on bifurcated request for
certification process; 40 CFR 121.5(a). As a result of the comments
received related to the proposed definition of ``application'' and
finalized approach regarding use of draft Federal licenses or permits
in the request for certification context, EPA is not finalizing the
proposed definition of the term ``application'' in the proposed rule.
Although the Agency is not proposing a definition of the term
``application'' in the final rule, it recognizes that with respect to
general Federal licenses and permits, there is no formal
``application,'' and for that reason acknowledges that Federal agencies
may provide a draft Federal license or permit in notification to EPA
pursuant to section 401(a)(2).\102\
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\102\ For this final rulemaking, EPA is not suggesting that
Corps civil works projects are exempt from neighboring jurisdictions
processes, even though there are no ``applications'' or draft
Federal licenses or permits. Rather, EPA expects the Corps to
determine how best to comply with all section 401 requirements.
Compliance may involve the Corps sending a project study in
conjunction with a certification or a waiver of certification.
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ii. Contents of Notification From a Federal Agency
Although the text of section 401(a)(2) requires a Federal agency to
notify EPA upon receipt of a Federal license or permit application and
certification,\103\ it does not define the contents of such
notification. 33 U.S.C. 1341(a)(2). The 1971 Rule and 2020 Rule
provided some direction on information that could be submitted to EPA
as part of the neighboring jurisdictions process, but neither
regulation defined the contents of the section 401(a)(2) notification.
See 40 CFR 121.12(b) (2020); 40 CFR 121.13 (2019).
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\103\ As previously discussed, EPA interprets the waiver of
certification as a substitute for a grant of certification for
purposes of section 401(a)(2). See section IV.K.2.c. of this
preamble for further discussion of this interpretation.
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The 1971 Rule provided that upon receipt of an application for a
license or permit with an accompanying certification, the Federal
agency shall forward copies of the application and certification to the
Regional Administrator. 40 CFR 121.11 (2019). It further stated that
only those portions of the application which relate to water quality
shall be forwarded to the Regional Administrator and allowed for the
Regional Administrator to ask for supplemental information if the
documents forwarded did not contain sufficient information to make the
determination provided for in Sec. 121.13. See 40 CFR 121.12 and
121.13 (2019). In the preamble to the 2020 Rule, EPA stated its
expectation that Federal agencies would develop notification processes
and procedures, but noted that the Administrator could request copies
of the certification and Federal license or permit application. 85 FR
42273. During implementation of the 2020 Rule, some but not all
agencies developed their own procedures, and such procedures varied
between Federal agencies and across the country.
EPA is finalizing its proposed approach to add regulatory text
defining the minimum level of information that must be included in the
notification to EPA to provide consistency in practices across Federal
agencies and to streamline the notification process. In Sec.
121.12(a), the Agency provides that the notification must be in writing
and contain a general description of the proposed project, including
but not limited to the Federal license or permit identifier, project
location information (e.g., latitude and longitude), a project summary
including the nature of any discharge and size or scope of activity,
and whether the Federal agency is aware of any neighboring jurisdiction
providing comment on the project. If the Federal agency is aware that a
neighboring jurisdiction provided comment about the project, the
notification shall include a copy of those comments. 40 CFR
121.12(a)(2). Additionally, the notification shall include a copy of
the certification or notice of waiver, and the Federal license or
permit application. 40 CFR 121.12(a)(1).
EPA is also finalizing the proposed approach allowing the Regional
Administrator to submit a written request to a Federal agency upon
determining there is a need for supplemental information to make a
determination about potential neighboring jurisdiction effects pursuant
to section 401(a)(2). 40 CFR
[[Page 66642]]
121.12(b). This provision allows the Regional Administrator to request
that such information be provided in a timely manner for EPA's ``may
affect'' determination and provides that the Federal agency ``shall
obtain that information from the project proponent and forward the
additional information to the Administrator within such timeframe.''
Likewise, the Agency is finalizing the proposed language allowing the
Regional Administrator to develop agreements with Federal agencies to
refine the notification process and the provision of supplemental
information, in Sec. 121.12(c) of the final rule.
One commenter addressing these proposed provisions argued that the
Federal agency should not be required to provide EPA with any
information other than the certification or waiver of certification and
the Federal license or permit application, because requiring such
information would exceed EPA's authority under section 401(a)(2) and
could result in burden on the Federal agency and the applicant. The
commenter further asserted that if the final rule includes supplemental
information requirements for section 401(a)(2) notification, then such
information should be limited to existing information that is readily
available. EPA disagrees that the provision in Sec. 121.12(b) of the
final rule allowing the Regional Administrator to request supplemental
information where needed to make a ``may affect'' determination exceeds
the Agency's statutory authority pursuant to section 401(a)(2). The
statutory text of section 401(a)(2) does not preclude the Agency from
seeking supplemental information in such circumstances, and otherwise
does not limit what information the Agency considers in making a ``may
affect'' determination. See 33 U.S.C. 1341(a)(2). Additionally, the
Agency finds that as a practical matter, it is both reasonable and in
the best interests of the Federal licensing or permitting agency and
the project proponent for the Agency to have adequate information to
inform its ``may affect'' determination. Although EPA is not creating
formalized strictures on the supplemental information the Regional
Administrator may request pursuant to Sec. 121.12(b) of the final
rule, given the uncertainty of addressing unknown circumstances
necessitating such supplemental information, it generally anticipates
that such supplemental information would be information readily
available to the Federal agency or project proponent.
f. EPA's Role Under Section 401(a)(2)
Section 401(a)(2) provides that whenever a discharge ``may affect,
as determined by the Administrator, the quality of the waters of any
other State,'' the Administrator must notify the neighboring
jurisdiction, Federal agency, and the project proponent of the
determination within thirty days of the date of notice of the
application. 33 U.S.C. 1341(a)(2). In Sec. 121.13 of the final rule,
EPA is finalizing its proposed approach to making a ``may affect''
determination and providing notification of a determination that a
discharge from a project may affect the water quality of a neighboring
jurisdiction, although it is doing so with changes to the proposed
regulatory text to omit the requirement that EPA provide such notice to
a certifying authority, and to provide further clarification that a
Federal license or permit cannot be issued without the neighboring
jurisdictions processes concluding, as discussed above. EPA is
otherwise maintaining its positions regarding the requirement that EPA
make a ``may affect'' determination, the timing of this determination
and notification, the meaning of ``may affect'' and EPA's ``may
affect'' analysis, and procedural and content requirements of ``may
affect'' notification, as reflected in Sec. 121.13 of the final rule
and discussed further below.
i. Requirement for EPA To Make ``May Affect'' Determination
At proposal, EPA stated its interpretation that the statutory text
of section 401(a)(2) requires the Agency to determine whether a
discharge ``may affect'' a neighboring jurisdiction once it receives
notification of the application and certification or waiver. 87 FR
35367. Therefore, EPA proposed regulatory text in Sec. 121.13(a)
providing that the Regional Administrator ``shall determine whether a
discharge from the certified or waived project may affect water quality
in a neighboring jurisdiction.'' EPA is finalizing the proposed
language in Sec. 121.13(a) of the final rule with revisions to remove
the term ``certified or waived.'' The removal of ``certified or
waived'' is intended to ensure language conformity across subpart B,
and remove redundancy, as Sec. 121.12(a) of the final rule already
states that once the Federal agency ``has received both the application
and either a certification or waiver,'' the Federal agency ``shall
provide written notification to the appropriate Regional
Administrator.'' 40 CFR 121.12(a) (emphasis added).
Under the 1971 Rule, the Regional Administrator was required to
review the Federal license or permit application, the certification,
and any supplemental information provided to EPA, and, if the Regional
Administrator determined that there was ``reason to believe that a
discharge may affect the quality of the waters of any State or States
other than the State in which the discharge originates,'' the Regional
Administrator would notify the affected jurisdictions within thirty
days of receipt of the Federal license or permit application materials
and certification. See 40 CFR 121.13 (2019). Similarly, the 2020 Rule
acknowledged EPA's responsibility to notify a neighboring jurisdiction
whenever it determined that a discharge from the certified activity may
affect the water quality of the neighboring jurisdiction. 40 CFR
121.12(b) (2020); 85 FR 42274. However, the 2020 Rule asserted that it
was within the Agency's discretion whether to make a ``may affect''
determination in the first place, and that EPA was, therefore, not
required to make such a determination. 85 FR 42273.
To date, EPA is only aware that one Federal district court has
addressed EPA's obligation to make a determination pursuant to section
401(a)(2). In Fond du Lac Band of Lake Superior Chippewa v. Wheeler,
519 F. Supp. 3d 549 (D. Minn. 2021), the court addressed two issues
concerning section 401(a)(2): (1) whether EPA is required to make a
``may affect'' determination and (2) whether EPA's ``may affect''
determination is judicially reviewable. The court concluded that EPA is
required to determine whether the discharge may affect the quality of a
neighboring jurisdiction's waters pursuant to section 401(a)(2). In
coming to this conclusion, the court examined the statutory text and
found that it requires EPA to make ``a discrete factual determination .
. . within a specific timeframe . . . based on an application and
certification. . . .'' Id. at 564. The court found that ``the existence
of such a clear and limited timeframe supports the argument that the
statute imposes a duty on EPA to make a `may affect' determination.''
Id. Further, the court concluded that Federal courts have the
jurisdiction to review EPA's ``may affect'' determination.\104\
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\104\ Notably, the court in Fond du Lac did not opine on the
specific meaning of ``may affect'' or factors that EPA should
consider in making a ``may affect'' determination. See 519 F. Supp.
3d 549.
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The Agency agrees with the court in Fond du Lac that EPA, pursuant
to section 401(a)(2), must determine whether a discharge ``may affect''
a
[[Page 66643]]
neighboring jurisdiction once it receives notification of the Federal
license or permit application and certification or waiver from the
Federal agency consistent with Sec. 121.12(a) of the final rule. As
discussed by the court in Fond du Lac, the statutory language in
section 401(a)(2), which requires the Agency to provide notification
within a set timeframe to a neighboring jurisdiction when it finds that
discharge from the project may affect its water quality, supports
finding that EPA is required to make a ``may affect'' determination.
See Fond du Lac, 519 F.Supp.3d at 563-64. Accordingly, the Agency is
finalizing language in Sec. 121.13(a) of the final rule, with the
modifications discussed above, to reflect this interpretation and
clarify that the Regional Administrator shall make this determination,
consistent with the Agency's interpretation of section 401(a)(2).
EPA received comments regarding its interpretation of section
401(a)(2) requiring the Agency to make a ``may affect'' determination,
and commenters were divided on whether EPA is required to make a ``may
affect'' determination. Some commenters agreed with EPA's
interpretation and the language in the proposal stating that section
401(a)(2) requires EPA to make a ``may affect'' determination upon
receiving notice from the Federal licensing or permitting agency.
Reasons cited for supporting this position included the rationale
provided by the court in Fond du Lac, cited by some commenters, and the
assertion that this approach better allows neighboring jurisdictions to
protect their water quality and provides transparency regarding the
Agency's actions.
Some other commenters asserted that section 401 provides EPA
discretion whether to make a ``may affect'' determination, and that EPA
need not make this determination with regard to all Federal licenses or
permits subject to section 401. In addition to asserting the position,
taken in the 2020 Rule, that the statutory language provides EPA
discretion as to whether to make a ``may affect'' determination, some
of these commenters otherwise argued that requiring EPA to make a ``may
affect'' determination for all Federal licenses or permits subject to
section 401 would be an inefficient use of EPA resources and would
result in unnecessary delays in the Federal licensing or permitting
process.
EPA finds that the statutory language in section 401(a)(2) provides
EPA discretion when making a ``may affect'' determination. However, the
Agency does not agree that the statutory text provides EPA with
discretion to decide that the Agency will not make a may affect
determination following appropriate notification from the Federal
agency. As noted by the court in Fond du Lac, this interpretation would
be inconsistent with the statutory text of section 401(a)(2) directing
the Agency to provide notification within a set timeframe to a
neighboring jurisdiction when it finds that a discharge from a project
may affect its water quality. See Fond du Lac, 519 F.Supp.3d at 563
(noting that it would be odd ``if a decisionmaker . . . was mandated by
law to do everything that was necessary to make a particular type of
decision . . . but was not mandated by law to actually make the
decision.''). Given the Agency's interpretation that it is required to
make a ``may affect'' determination upon appropriate notification from
the Federal licensing or permitting agency pursuant to section
401(a)(2), the Agency finds that use of resources for this purpose is
necessary to comply with the statute. Finally, the Agency rejects the
argument that making ``may affect'' determinations in accordance with
Sec. 121.13(a) of the final rule will add unnecessary delays to the
Federal licensing or permitting process, as the Agency is finding that
it is required to make a ``may affect'' determination pursuant to
section 401(a)(2), and the statutory text provides a set, relatively
short, timeframe for the Agency to make this determination (30 days).
See 33 U.S.C. 1341(a)(2).
ii. Timing of EPA's ``May Affect'' Determination and Notification
As previously discussed, section 401(a)(2) requires EPA to provide
notification ``within thirty days of the date of notice of application
for such Federal license or permit'' to the neighboring jurisdiction,
the Federal Agency, and the project proponent whenever it determines
that a discharge from a project may affect the water quality of a
neighboring jurisdiction. 33 U.S.C. 1341(a)(2). EPA finds that the
``notice of application for such license or permit'' references the
prior statutory text of section 401(a)(2) requiring the Federal agency
to immediately notify the Administrator ``[u]pon receipt of such
application and certification.'' See section IV.K.2.e in this preamble
for discussion regarding timing of Federal agency notification to EPA
pursuant to section 401(a)(2). Accordingly, EPA finds that section
401(a)(2) provides EPA with a 30-day period to make its ``may affect''
determination and provide any required notification after receiving
notice from the Federal agency of the Federal license or permit
application and certification or waiver. EPA has, therefore,
incorporated this 30-day period into the provisions it is finalizing in
Sec. 121.13(a) and (b) regarding its ``may affect'' determination and
``may affect'' notification, as it proposed. This is consistent with
the approach taken in the 2020 Rule, which also provided a 30-day
period for the EPA to make a ``may affect'' determination and provide
``may affect'' notification following appropriate notice from the
Federal agency. See 40 CFR 121.12 (2020).
A few commenters discussed the period EPA is provided to make a
``may affect'' determination or ``may affect'' notification. One
commenter argued that 30 days is too long of a period for EPA to make
``may affect'' determinations, and suggested EPA limit the timeframe to
complete these determinations to 15 days. Another commenter requested
that EPA establish a reasonable period of time to provide notification
to the Federal agency and certifying authority calculated from the date
the individual certification is issued for purposes of avoiding
unnecessary permitting delays. As discussed above, the statute provides
EPA with a 30-day period to make a ``may affect'' determination and
provide any required notification, and EPA declines to shorten the time
period for the Agency to take such actions. EPA notes that the 2020
Rule also provided a 30-day timeframe for the Agency to perform these
actions, and EPA did not find that this approach resulted in
unnecessary Federal licensing or permitting delays. Accordingly, the
Agency finds it reasonable to retain the 30-day period reflected in
statute for making a ``may affect'' determination and providing any
required notification.
iii. EPA's ``May Affect'' Determination and ``May Affect'' Standard
Section 401(a)(2) provides that EPA makes the ``may affect''
determination in the neighboring jurisdictions process, as discussed
above, but notably does not delineate specific factors for the Agency
to consider in determining whether a discharge from a project may
affect the water quality of a neighboring jurisdiction. See 33 U.S.C.
1341(a)(2). Likewise, the 2020 Rule did not address in either preamble
or regulatory text whether there are specific factors that the EPA
considers in making a ``may affect'' determination or whether any other
interested party can be involved in making this determination. See 85
FR 42273. During the pre-proposal outreach, stakeholders raised
concerns that EPA had not clearly identified what factors it intended
to use in determining whether a discharge ``may affect'' the water
quality of a neighboring jurisdiction. Stakeholders also objected
[[Page 66644]]
to EPA asserting sole discretion over this ``may affect'' determination
without obtaining input from the neighboring jurisdiction or other
stakeholders.
In the preamble to the proposed rule, EPA asserted that the Agency,
in making a ``may affect'' determination, has discretion to look at a
variety of factors depending on the type of Federal license or permit
and discharge. 87 FR 35367. EPA further stated that factors it may
consider in making a ``may affect'' determination include but are not
limited to the type of project and discharge covered in the Federal
license or permit, the proximity of the project and discharge to other
jurisdictions, certification conditions and other conditions already
contained in the draft Federal license or permit, and the neighboring
jurisdiction's water quality requirements. 87 FR 35367-68. The Agency
clarified that it was not proposing to identify specific factors EPA
must analyze in making a ``may affect'' determination, given the range
of Federal licenses or permits that are covered by CWA section
401(a)(2) and EPA's discretion to look at various factors. 87 FR 35368.
The Agency noted that each ``may affect'' determination is likely to be
fact-dependent and based on situation-specific circumstances and
expressed uncertainty that it could provide a required list of factors
for it to consider in making a ``may affect'' determination. Id.
However, the Agency solicited comment on whether such a list of
specific factors that EPA must consider in making a ``may affect''
determination should be set forth in regulation and, if so, what
factors should be included. Id.
Additionally, in the proposal, the Agency clarified its position
that it has sole discretion under section 401(a)(2) to examine the
facts and determine whether the discharge ``may affect'' the quality of
a neighboring jurisdiction's waters once it receives notice from a
Federal agency initiating its obligation to make a ``may affect''
determination. 87 FR 35368. As a result, EPA stated that the Agency is
not required to engage with stakeholders or seek their input in making
this determination, and otherwise noted interested parties may have
recourse under the Administrative Procedure Act, as discussed in Fond
du Lac case. Id.; see also Fond du Lac, 519 F.Supp.3d at 565-67.
However, EPA stated that it intends to consider the views of
neighboring jurisdictions in making its ``may affect'' determination if
such views are provided in a timely manner. Id. Specifically, the
Agency proposed regulatory language in Sec. 121.12(a), as discussed
above, to define the contents of a Federal agency's notification to EPA
to include an indication of whether any neighboring jurisdictions have
expressed water quality concerns or provided such comment on the
project.\105\
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\105\ The Agency notes, as it did at proposal, that there are
other opportunities for stakeholders to provide input into the
certification and Federal licensing or permitting process, including
the public notice and comment processes on the certification and the
Federal license or permit.
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The Agency is maintaining its position that it has sole discretion,
pursuant to section 401(a)(2), to examine the facts and determine
whether the discharge ``may affect'' the quality of a neighboring
jurisdiction's waters. This interpretation regarding the Agency's
discretion is consistent with the statutory language of section
401(a)(2), which directs EPA to notify neighboring jurisdictions
``[w]henever such a discharge may affect, as determined by the
Administrator. . . .'' 33 U.S.C. 1341(a)(2) (emphasis added). The
Agency is further maintaining its position that EPA is not required to
engage with stakeholders or seek their input in making a ``may affect''
determination. However, as previously discussed, the Agency may
consider the neighboring jurisdiction's views on the effect of a
discharge from the project on its water quality as a factor in making a
``may affect'' determination. Further, in Sec. 121.12(a) of the final
rule, EPA is finalizing the proposed regulatory text defining the
contents of a Federal agency's notification to EPA to include an
indication of whether any neighboring jurisdictions have expressed
water quality concerns or provided such comment on the project. This
provision may increase EPA's awareness of water quality concerns raised
by neighboring jurisdictions at the time the Agency receives notice
prompting it to make a ``may affect'' determination, and EPA reiterates
its intention to consider such views of neighboring jurisdictions if
provided in a timely manner.
Some commenters disagreed with EPA's position on the role of
neighboring jurisdictions or other stakeholders during in its ``may
affect'' process. A few commenters suggested that EPA consult with or
involve neighboring jurisdictions in making ``may affect''
determinations. Additionally, a commenter argued that it was
appropriate and reasonable for EPA to solicit input from the project
proponent and Federal licensing or permitting agency in the process of
making a ``may affect'' determination. EPA finds its position regarding
its sole discretion in making a ``may affect'' determination and the
role of stakeholders, including neighboring jurisdictions, in such a
determination is reasonable and consistent with the statutory text of
section 401(a)(2). Section 401(a)(2) specifically recognizes EPA's
discretion in making a ``may affect'' determination, and does not
establish a role for stakeholders in EPA's determination. Further,
section 401(a)(2) provides EPA with only 30 days to make a ``may
affect'' notification and provide any required notification to
neighboring jurisdictions. EPA does not find the limited period of time
that the statute affords the Agency for its ``may affect''
determination and any required notification consistent with a process
in which it engages stakeholders and solicits their input, and imposing
such a process would burden the Agency. Accordingly, EPA declines to
adopt such a process for ``may affect'' determinations.
EPA is not further defining the meaning of ``may affect'' in
section 401(a)(2), aside from identifying factors that it may consider
in making a ``may affect'' determination, as the statutory language
provides sufficient clarity that this standard is met ``[w]henever such
a discharge may affect, as determined by the Administrator, the quality
of the waters'' of a neighboring jurisdiction. 33 U.S.C. 1341(a)(2).
Some commenters sought, or offered, further interpretations of the
``may affect'' standard in section 401(a)(2). Such commenters asserted
differing interpretations of the meaning of the ``may affect''
standard, including recommending that EPA make an actual demonstration
that there may be an effect and suggesting that it is a low threshold
(i.e., some reasonable possibility an effect may exist). As stated
above, EPA is not defining the meaning of the ``may affect'' standard.
This standard is necessarily broadly applicable, as it must be applied
to differing Federal licenses and permits in a wide range of factual
circumstances. Moreover, section 401(a)(2) recognizes the
Administrator's discretion applying this standard in a ``may affect''
determination.
Although EPA is not attempting to further define the ``may affect''
standard in the final rule, it notes that this standard is
distinguishable from the standard that notified neighboring
jurisdictions apply to make a determination regarding an objection,
which is whether ``such discharge will affect the quality of its waters
so as to violate any water quality requirements'' in its jurisdiction.
See 33 U.S.C. 1341(a)(2). Unlike the standard applied by notified
neighboring jurisdictions in making a determination regarding an
[[Page 66645]]
objection, the standard applied by EPA in its ``may affect'' analysis
does not require consideration of whether water quality effects of
discharge from the project will result in violation of water quality
requirements. Instead, the standard applied by EPA in its ``may
affect'' determination only requires analysis of whether discharge from
the project may have water quality effects on a neighboring
jurisdiction.\106\ Additionally, the ``may affect'' standard, in
contrast to the standard applied by notified neighboring jurisdictions,
does not require a finding that the discharge ``will'' effect water
quality. Accordingly, EPA finds this standard may be met where there
may be an effect to a neighboring jurisdiction's water quality, but
such effect is not certain to occur.
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\106\ See section IV.E of this preamble for further discussion
on the breadth of water quality effects that may be considered under
section 401.
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EPA is finalizing the proposed approach to identify factors that
EPA may consider in making a ``may affect'' determination and is not
establishing specific factors that EPA must analyze in making a ``may
affect'' determination. EPA is also reiterating the factors that it
identified in the preamble of its proposal as factors it may consider
in making a ``may affect'' determination. Accordingly, EPA is
identifying that such factors include, but are not limited to, the type
of project and discharge covered in the Federal license or permit, the
proximity of the project and discharge to neighboring jurisdictions,
certification conditions and, as applicable, other conditions already
contained in the draft Federal license or permit, the neighboring
jurisdiction's water quality requirements, and the views of the
neighboring jurisdiction on the effect of discharge from the project on
its water quality. Based on public comments, EPA is also identifying
additional factors it may consider. Specifically, EPA may consider the
current water quality and characteristics of the water receiving the
discharge in making a ``may affect'' determination. However, EPA
reiterates that it is neither limited to considering, nor required to
consider, the factors identified here.
With regard to the Agency's proposed approach of identifying
factors it may consider in making a ``may affect'' determination, most
commenters addressing this approach supported EPA providing some
identification of such factors in the final rule. Such commenters noted
that identification of factors clarifies and provides broader
understanding of the EPA's process in making a ``may affect''
determination and could improve efficiency in making this
determination. Some commenters agreed that EPA has discretion in making
a ``may affect'' determination, but asserted that this discretion is
constrained by the statutory bounds of section 401.
However, commenters were notably divided on the approach the Agency
should take to identifying these factors. Some commenters recommended
that EPA establish an exclusive list of factors it considers in making
``may affect'' determinations, limiting the factors considered in each
determination to only those identified on this list. Commenters
supporting this position collectively asserted that this approach would
limit subjectivity in such determinations, increase predictability, and
allow Federal agencies and project proponents to better plan for these
determinations. Other commenters supported EPA codifying a list of
factors it must consider in making a ``may affect'' determination, but
providing that EPA may consider other factors. In contrast, some other
commenters supported EPA's proposed approach to identify examples of
factors the Agency may consider, but did not recommend requiring EPA to
consider factors in recognition of the fact-dependent nature of ``may
affect'' determinations.
EPA agrees that its discretion regarding making a ``may affect''
determination is bounded by the statutory grant of authority in section
401. EPA disagrees with the approaches suggested by certain commenters
that EPA identify either an exclusive list of factors for the Agency to
consider in making this determination, or establish a minimum list of
factors that EPA must consider, as these approaches do not recognize
the fact-dependent nature of a ``may affect'' determination and do not
provide the flexibility necessary for the Agency to make ``may affect''
determinations involving different types of licenses and permits.
Identifying an exclusive list of factors for the Agency to consider in
making a ``may affect'' determination could preclude the Agency from
considering important information relevant to determining whether
discharge from a project may affect the water quality of a neighboring
jurisdiction. Additionally, this approach does not appear to be
consistent with the statutory language in section 401(a)(2), which does
not impose limitations on the information the Agency may consider in
making this determination, but rather recognizes the Agency's
discretion in making this determination. Likewise, establishing a
minimum list of factors that EPA must consider in a ``may affect''
determination could require the Agency to consider factors even where
they are not relevant to determining whether discharge may affect the
water quality of a neighboring jurisdiction. This approach would not
prove efficient, which is of particular concern as the Agency is only
afforded 30 days to make a ``may affect'' determination and provide any
required ``may affect'' notification. Instead, the Agency finds that
identifying examples of factors that it may consider in making a ``may
affect'' determination, as it has above, provides greater clarity
without inappropriately limiting the Agency from considering other
relevant factors or requiring it to apply factors where they are
irrelevant.
iv. ``May Affect'' Notification
If EPA determines that a discharge from a project may affect a
neighboring jurisdiction's water quality, section 401(a)(2) requires
EPA to notify the neighboring jurisdiction, Federal agency, and the
project proponent. 33 U.S.C. 1341(a)(2). As previously discussed, EPA
must provide such notification within 30 days from notice provided by
the Federal agency in accordance with section 401(a)(2). See id.;
section IV.K.2.f.ii in this preamble for discussion on timing of EPA's
may affect finding and any resulting notice. Notably, a finding by EPA
that a discharge from a project may affect a neighboring jurisdiction's
water quality pursuant to section 401(a)(2) is often referred to as a
``may affect'' finding, and the resulting notification of this finding
is referred to as a ``may affect'' notification. Section 401(a)(2) does
not require EPA to provide notification in circumstances where it has
completed its ``may affect'' determination but has not found that a
discharge from the project may affect a neighboring jurisdiction's
water quality (i.e., has not made a ``may affect'' finding). See 33
U.S.C. 1341(a)(2). Accordingly, in its proposal, EPA stated that it is
not required to provide notification of its ``may affect''
determination in such circumstances. Consistently, EPA further stated
that if a Federal agency does not receive notification from EPA that a
discharge may affect a neighboring jurisdiction's water quality within
30 days after the proper notice, then the Federal agency may proceed
with processing the Federal license or permit. 87 FR 35368.
EPA received comments relating to its ``may affect'' notification
in the neighboring jurisdictions process. A few commenters expressed
concern that EPA is not required to provide a response when not finding
that a
[[Page 66646]]
discharge may affect the water quality of a neighboring jurisdiction
and suggested that lack of a response could have meaning other than
this finding. Some of these commenters proposed that EPA provide
notification to neighboring jurisdictions in circumstances where the
Agency's ``may affect'' determination does not result in ``may affect''
finding, or otherwise suggested that the Agency provide public notice
regarding its ``may affect'' determination. Some commenters supporting
these approaches to notification asserted that they would increase
transparency regarding EPA's ``may affect'' determination and inform
interested parties regarding this determination.
In consideration of the statutory constraints on EPA to make a
``may affect'' determination and provide ``may affect'' notification
within 30 days of proper notice from the Federal agency, EPA is not
expanding the notification requirements beyond the circumstances and to
the parties it is required to provide such notification pursuant to
section 401(a)(2). The neighboring jurisdictions process established in
section 401(a)(2) does not direct the EPA to provide notification
outside of circumstances in which the Agency has determined that a
discharge from the project may affect a neighboring jurisdiction's
water quality. Likewise, the statutory language does not provide for
``may affect'' notification to other parties besides the relevant
neighboring jurisdiction, the Federal agency, and the project
proponent. See 33 U.S.C. 1341(a)(2). Accordingly, the statutory
language reflects a more limited process for the Agency to provide
``may affect'' notification than suggested by certain commenters, which
is consistent with the limited duration of time afforded the Agency for
making a ``may affect'' determination and providing such notification
in section 401(a)(2). Given the limited 30-day period for Agency action
in this context, and in consideration of the overall volume of ``may
affect'' determinations made by the Agency, EPA finds it reasonable to
maintain the notification requirements established in the statutory
text of section 401(a)(2), and is not expanding these requirements
beyond the statutory bounds.
In addition to incorporating the notification requirements on EPA
in section 401(a)(2) pertaining to a ``may affect'' finding, the 2020
Rule established additional procedures for EPA in providing such
notification. The 2020 Rule required EPA to provide such notification
to the certifying authority, as well as the neighboring jurisdiction,
Federal agency, and the project proponent. 40 CFR 121.12(c) (2020).
Additionally, the 2020 Rule required the notification to be dated and
in writing and established certain requirements on the content of such
notification. 40 CFR 121.12(c)(1) (2020). Specifically, the 2020 Rule
required that the notification identify the materials provided by the
Federal agency and inform the neighboring jurisdiction that it had 60
days to notify the Administrator and the Federal agency, in writing,
whether it had determined that the discharge will violate any of its
water quality requirements, to object to the issuance of the Federal
license or permit, and to request a public hearing from the Federal
agency. Id. In contrast, the 1971 Rule did not define the contents of a
``may affect'' notification from EPA to a neighboring jurisdiction,
Federal agency, and project proponent. However, the 1971 Rule required
EPA to send the neighboring jurisdiction a copy of the application and
certification it received to initiate the neighboring jurisdictions
process. 40 CFR 121.14 (2019).
EPA proposed retaining regulatory text similar to that in the 2020
Rule requiring EPA to provide the ``may affect'' notification to the
neighboring jurisdiction, Federal agency, the project proponent, and
the certifying authority. The Agency further proposed maintaining
content requirements for the ``may affect'' notification, but proposed
revising these requirements to establish that the notification shall be
in writing and shall include a statement that the Agency has determined
that the discharge may affect the neighboring jurisdiction's water
quality, as well as a description of the next steps in the neighboring
jurisdictions process, a copy of the certification or waiver, and a
copy of the Federal license or permit application.
In Sec. 121.13(b) and (c) of the final rule, EPA is finalizing the
proposed approach for providing a ``may affect'' notification with
minor changes to the content requirements for a ``may affect''
notification and the omission of the requirement that EPA provide such
notice to a certifying authority. As noted above, EPA revised the
proposed text of Sec. 121.13(c), addressing the contents of the
Regional Administrator's ``may affect'' notification, to conform the
statement that the Agency provides to notified neighboring
jurisdictions more closely with the statutory text of section 401(a)(2)
and provide greater clarity about notification needed for an objection.
Rather than providing a statement that the notified neighboring
jurisdiction ``has 60 days'' to provide written notification ``whether
it has determined that the discharge will violate any of its water
quality requirements,'' as proposed in Sec. 121.13(c)(3), the final
rule states that the Agency provides a statement that the notified
neighboring jurisdiction ``has 60 days after such notification'' from
the Agency to provide written notification ``if it has determined that
the discharge will violate any of its water quality requirements.'' 40
CFR 121.13(c)(3). This revision ensures that the ``may affect''
notification reflects the statutory text of section 401(a)(2) and more
clearly conveys the statutory time and content requirements of the
notification needed for an objection than the proposed regulatory text.
Likewise, as previously mentioned, Sec. 121.13(b) and (c) of the
final rule was revised to omit the requirement that EPA provide the
``may affect'' notification to the certifying authority. Although the
2020 Rule required EPA to provide the ``may affect'' notification to
the certifying authority, and proposed retaining this provision, EPA is
omitting such notification to the certifying authority in the final
rule to more closely reflect the statutory language in section
401(a)(2), which does not require such notification to the certifying
authority. This is consistent with the Agency's approach in the final
rule to likewise remove language from the proposed regulatory text
requiring a notified neighboring jurisdiction to provide notification
to the certifying authority in Sec. 121.14. Both changes reflect the
structure of the neighboring jurisdictions process established in
section 401(a)(2), which does not provide a specified role for the
certifying authority.
In addition to EPA's role in the neighboring jurisdictions process
to make a ``may affect'' determination and provide ``may affect''
notification, as addressed in Sec. 121.13 of the final rule and
described above, the Agency also has at role at a hearing on an
objection of a notified neighboring jurisdiction, which is reflected in
Sec. 121.15(c) of the final rule and discussed further below. See
section IV.K.2.h in this preamble for discussion of the Agency's role
to provide its evaluation and recommendations concerning the objection
at such hearing and Sec. 121.15(c).
g. Neighboring Jurisdiction's Role Under Section 401(a)(2)
CWA section 401(a)(2) provides that if, within 60 days after
receipt of EPA's ``may affect'' notification, a neighboring
jurisdiction determines that such discharge will affect the quality of
its waters so as to violate any water quality
[[Page 66647]]
requirements in its jurisdiction, and within such 60-day period
notifies the Administrator and the Federal licensing or permitting
agency in writing of its objection to the issuance of such Federal
license or permit and requests a public hearing, the Federal licensing
or permitting agency shall hold a public hearing on the objection. 33
U.S.C. 1341(a)(2). Therefore, only neighboring jurisdictions notified
by EPA may object to issuance of a Federal license or permit and
request a hearing on this objection pursuant to section 401(a)(2).
Further, in order for a notified neighboring jurisdiction to make an
objection, it must (1) determine that a discharge from the project for
which it received such notification will affect the quality of its
waters so as to violate any of its water quality requirements, and (2)
provide written notification of its objection and request for hearing
to EPA and the Federal licensing or permitting agency within sixty days
after receipt of notification from EPA. Notably, the determination made
by a notified neighboring jurisdiction as to whether a discharge from
the project will affect the quality of its waters so as to violate any
water quality requirements is often referred to as a ``will violate''
determination. The provisions in the final rule regarding a notified
neighboring jurisdiction's ``will violate'' determination and
notification of objection and request for hearing are discussed below.
i. ``Will Violate'' Determination and Standard
Under section 401(a)(2), a notified neighboring jurisdiction's
``will violate'' determination is based upon whether a discharge from
the project ``will affect the quality of its waters so as to violate
any water quality requirements'' in its jurisdiction. 33 U.S.C.
1341(a)(2). EPA incorporated this standard in the proposed text of
Sec. 121.14(a), which reflected that the neighboring jurisdiction
``determines that a discharge will violate any of its water quality
requirements.'' However, EPA did not propose to further define the
``will violate'' standard applied by notified neighboring
jurisdictions, or otherwise identify specific factors that neighboring
jurisdictions may or must consider in making this determination.
EPA is revising the proposed text of Sec. 121.14 to clarify that
the ``will violate'' determination is made only by a notified
neighboring jurisdiction, and is therefore adding text to Sec.
121.14(a) providing that a ``will violate'' determination is made by
``a neighboring jurisdiction notified by the Regional Administrator
pursuant to Sec. 121.13(b),'' and is otherwise revising references to
``the neighboring jurisdiction'' in the proposed text to ``the notified
neighboring jurisdiction'' in Sec. 121.14 of the final rule. EPA is
otherwise modifying the text of Sec. 121.14(a) to further reflect that
the notified neighboring jurisdiction is evaluating ``discharge from
the project.'' 40 CFR 121.14. These changes were made to add clarity,
as pursuant to section 401(a)(2), only notified neighboring
jurisdictions make a ``will violate'' determination, and this
determination evaluates discharge from the project for which the
neighboring jurisdiction received such notification from EPA. See 33
U.S.C. 1341(a)(2). EPA is otherwise maintaining the proposed approach
in the final rule to not further define the ``will violate'' standard
in regulation or identify factors for consideration in making this
determination.
EPA received comment related to the ``will violate'' standard
applied by notified neighboring jurisdictions. One commenter requested
that EPA modify proposed Sec. 121.14 to ensure that the regulation
reflects that the ``will affect'' standard includes a discharge's
contributions to water quality violations and that the discharge itself
does not have to be the sole cause of the water quality violation. EPA
finds that the statutory text of section 401(a)(2), and the consistent
text of Sec. 121.14(a), sufficiently establish the ``will violate
standard,'' and therefore declines to further define this standard.
Like the Agency's ``may affect'' standard, the ``will violate''
standard is necessarily broadly applicable, as it must be applied to
differing Federal licenses and permits in a wide range of factual
circumstances. Accordingly, the Agency is not modifying Sec. 121.14 as
suggested by the commenter; however, EPA agrees that the ``will
violate'' standard includes a discharge's contributions to water
quality violations. Therefore, the neighboring jurisdiction does not
have to find that the discharge itself violates water quality
requirements and, instead, can find that the discharge contributes to
violations of water quality requirements to determine the ``will
violate'' standard is met. EPA further notes that the public, including
interested stakeholders, will have the opportunity to participate in
any hearing on an objection conducted by the Federal licensing or
permitting agency, pursuant to section 401(a)(2) and Sec. 121.15 of
the final rule.
ii. Notification of Objection and Request for Hearing
As previously noted, section 401(a)(2) requires a notified
neighboring jurisdiction to provide written notification of its
objection and request for hearing to EPA and the Federal licensing or
permitting agency within sixty days after receipt of notification from
EPA in order to raise an objection. See 33 U.S.C. 1341(a)(2). The
statutory text, however, does not further describe the contents of this
written notification. The 1971 Rule did not describe the contents or
form that such an objection notification must take. However, the 2020
Rule provided that ``[n]otification of objection and request for a
hearing from the neighboring jurisdiction shall: be in writing;
identify the receiving waters it determined will be affected by the
discharge; and identify the specific water quality requirements it
determines will be violated by the certified project. 40 CFR
121.12(c)(2) (2020); 85 FR 42274.
EPA proposed to revise the specific regulatory requirements for
what a neighboring jurisdiction is required to include in an objection
notification and request for hearing sent pursuant to section 401(a)(2)
in proposed Sec. 121.14(b). Consistent with the statutory text of
section 401(a)(2), the Agency proposed to retain the requirement that
the objection be in writing. Additionally, EPA proposed that the
notification of objection and request for hearing from the notified
neighboring jurisdiction include ``[a] statement that the neighboring
jurisdiction objects to the issuance of the Federal license or permit''
(proposed Sec. 121.14(b)(1)), and ``[a] request for a public hearing
from the Federal agency on its objection'' (proposed Sec.
121.14(b)(3)). However, rather than requiring the notified neighboring
jurisdiction to identify the receiving waters affected by the discharge
and the specific water quality requirements violated as required in the
2020 Rule, EPA proposed in Sec. 121.14(b)(2) that the notification
include ``[a]n explanation of the reasons supporting the neighboring
jurisdiction's determination that the discharge will violate its water
quality requirements, including but not limited to, an identification
of those water quality requirements that will be violated.'' EPA
proposed in Sec. 121.14(a), that the notification of objection and
request for hearing from the notified neighboring jurisdiction be made
``within 60 days after receiving notice in accordance with Sec.
121.13(c),'' and otherwise that such notification be made to the
Regional Administrator, the
[[Page 66648]]
Federal agency, and the certifying authority.
In Sec. 121.14, the Agency is finalizing the proposed contents of
a notification of objection and request for hearing from a notified
neighboring jurisdiction with modifications for purposes of adding
clarity and more closely conforming this regulatory text with section
401(a)(2). Consistent with revisions throughout Sec. Sec. 121.14 and
121.15 in the final rule, EPA revised references to ``the neighboring
jurisdiction'' in the proposed text of Sec. 121.14 to ``the notified
neighboring jurisdiction'' in the final rule to clarify that pursuant
to section 401(a)(2) only a neighboring jurisdiction notified by EPA
makes a ``will violate'' determination and may provide notification of
an objection and request a hearing. Likewise, consistent with revisions
throughout Subpart B of the final rule, EPA revised Sec. 121.14 of the
final rule to clarify that the ``discharge'' that the notified
neighboring jurisdiction considered in its ``will violate''
determination is ``discharge from the project'' in accordance with
section 401(a)(2). Otherwise, EPA is maintaining the requirements that
the notification of objection and request for hearing be in writing and
include (1) a statement that the notified neighboring jurisdiction
objects to the issuance of the Federal license or permit, (2) an
explanation of the reasons supporting the notified neighboring
jurisdiction's determination that the discharge from the project will
violate its water quality requirements, including but not limited to,
an identification of those water quality requirements that will be
violated, and (3) a request for public hearing from the Federal agency
on the notified neighboring jurisdiction's objection.
EPA received comments regarding the contents of a notification of
objection and request for hearing from a notified neighboring
jurisdiction. Some commenters stated that EPA should eliminate any
content requirements that go beyond the express language in section
401(a)(2), including an explanation of the reasons supporting the
determination that the discharge will violate water quality
requirements. More specifically, these commenters objected to the
requirement that the neighboring jurisdiction identify the water
quality requirements that will be violated on the basis that this
requirement is too burdensome on the notified neighboring jurisdiction.
Other commenters concurred that the objection should include
identifiable and justifiable reasons supporting the determination that
the discharge will violate water quality requirements. In addition,
some commenters stated that the neighboring jurisdiction should be
required to include a citation to the water quality requirements that
it believes will be violated.
EPA does not find that Sec. 121.14(b) is too burdensome on the
notified neighboring jurisdiction, and otherwise finds it reasonable
that the notified neighboring jurisdiction's notification of an
objection and request for hearing include an explanation of the reasons
supporting the ``will violate'' determination. Section 401(a)(2) of the
CWA states that a notified neighboring jurisdiction may make an
objection and request a hearing ``[i]f . . . [the neighboring
jurisdiction] determines that such discharge will affect the quality of
its waters so as to violate any water quality requirements. . . .'' 33
U.S.C. 1341(a)(2) (emphasis added). To accomplish this, the neighboring
jurisdiction necessarily must consider its water quality requirements
and complete an analysis or evaluation to determine that a discharge
from the project will violate such water quality requirements. All EPA
is requiring in Sec. 121.14(b)(2) of the final rule is that the
neighboring jurisdiction provide an explanation of that analysis or
evaluation in its notification of objection and request for hearing,
including the identification of the water quality requirements that
will be violated. This will inform the Federal licensing or permitting
agency, EPA, and the project proponent of the reasoning for the
objection; allow the Federal agency and EPA to prepare for a hearing on
the objection; and may assist in determining whether there is a way to
resolve the objection before the public hearing. EPA finds this
requirement is reasonable to inform the neighboring jurisdictions
process and does not find it imposes an unreasonable burden on the
notified neighboring jurisdiction.
Some commenters recommended that EPA require the neighboring
jurisdiction to identify a Federal license or permit condition(s) that
it thinks would resolve the objection in its notification of objection
and request for hearing. Conversely, one commenter stated that EPA
should not require the neighboring jurisdiction to provide conditions
that would resolve the objection. EPA is not requiring the notified
neighboring jurisdiction to include conditions with its objection
notification and request for hearing; however, EPA recommends that the
neighboring jurisdiction provide Federal license or permit conditions
that will resolve the objection, if this is possible. Identifying
conditions to resolve an objection, where possible, may help inform the
hearing process, and could also help resolve an objection in advance of
a hearing. In circumstances where the notified neighboring jurisdiction
does not find any conditions would resolve the objection, EPA notes
that the neighboring jurisdiction could simply state this in its
objection notification and hearing request.
A few commenters asserted that the project proponent, as opposed to
the neighboring jurisdiction, has the burden to show that a Federal
license or permit should be issued. EPA observes that section 401(a)(2)
only provides the notified neighboring jurisdiction, the Federal
licensing or permitting agency, and EPA with explicit roles and duties
in the neighboring jurisdictions process. CWA section 401(a)(2)
requires the neighboring jurisdiction to determine whether the
discharge will violate its water quality requirements after EPA makes a
``may affect'' determination, and if so, object to the issuance of the
Federal license or permit and request a public hearing. After that, if
the neighboring jurisdiction does not withdraw its objection, the
Federal licensing or permitting agency must hold a public hearing and
determine whether any conditions are necessary to ensure that the
neighboring jurisdiction's water quality requirements are met. See 33
U.S.C. 1341(a)(2) (``Such Agency . . . shall condition such license or
permit in such manner as may be necessary to insure compliance with
applicable water quality requirements.''). Section 401(a)(2) does not
provide an explicit role for the project proponent in the neighboring
jurisdictions process, although the project proponent may provide input
at the public hearing. Accordingly, this final rule cannot require a
project proponent to demonstrate that a Federal license or permit
should be issued through the neighboring jurisdictions process.
Some commenters asserted that the neighboring jurisdiction should
be required to identify the ``potentially affected'' receiving water in
an objection notification and request for hearing. This request appears
similar to language in the 2020 Rule that required a notified
neighboring jurisdiction to ``identify the receiving waters it
determined will be affected by the discharge.'' 40 CFR 121.12(c)(2)
(2020). One of these commenters stated that failure to identify the
receiving water makes it impossible to determine the validity of the
concerns raised to resolve the neighboring jurisdiction's concerns and
allows the neighboring jurisdiction to
[[Page 66649]]
raise arbitrary concerns to slow down the Federal licensing or
permitting process.
EPA declines to require the notified neighboring jurisdiction to
specifically identify affected receiving waters in its notification of
objection and request for hearing. However, as EPA noted in its
proposal, the Agency anticipates that this information is likely to be
included in a notified neighboring jurisdiction's explanation of the
reasons supporting its ``will violate'' determination, and EPA
encourages neighboring jurisdictions to include this information where
possible, as it may assist the Federal agency in evaluating the
objection. As the notified neighboring jurisdiction has a limited time
period of 60-days to make its ``will violate'' determination and issue
any notification of an objection and request for hearing, imposing a
requirement that this notification identify all waters where discharge
will violate water quality requirements may not be feasible in all
circumstances. Accordingly, EPA is not including this requirement.
In addition to the requirements regarding the content of a
notification of objection and request for hearing, EPA is also
finalizing the procedural requirements in Sec. 121.14(a) with some
modifications for purposes of added clarity and consistency with
section 401(a)(2). Consistent with the statutory language in section
401(a)(2), EPA is retaining the requirement that the notified
neighboring jurisdiction provide notification of its objection and
request for hearing within 60 days of a ``may affect'' notice from EPA
but is updating the internal citation to reflect that this notification
is provided by the Regional Administrator ``pursuant to Sec.
121.13(b)'' of the final rule. Additionally, as mentioned above, EPA is
removing the requirement in the proposed regulatory text that a
notified neighboring jurisdiction provide notification to the
certifying authority in order to more closely reflect the statutory
language in section 401(a)(2), which does not require notification to
the certifying authority.
EPA received comments regarding its proposal to require the
notified neighboring jurisdiction to send the ``will affect''
notification to the certifying authority, as well as to the Federal
licensing or permitting agency and Regional Administrator. Some
commenters supported this proposed approach. Conversely, another
commenter stated that the neighboring jurisdiction should not be
required to send the notification to the certifying authority because
there is no statutory basis for this requirement and CWA section
401(a)(2) provides no role for the certifying authority. As noted, in
the final rule, EPA has eliminated the requirement that the notified
neighboring jurisdiction send the notification to the certifying
authority to conform the regulatory text more closely with the
statutory language in section 401(a)(2), which does not require
notification to the certifying authority. EPA agrees that, unlike the
Regional Administrator and the Federal agency, the certifying authority
does not have a specific role under CWA section 401(a)(2). In fact, the
neighboring jurisdictions process occurs after the certifying authority
has acted on a request for certification. However, like the project
proponent, the certifying authority may participate in the neighboring
jurisdictions process by providing comments during the public hearing.
EPA encourages the Federal agency to involve the certifying authority
in conversations that occur prior to the public hearing, if it believes
that the certifying authority may have information that could inform
discussions with the notified neighboring jurisdiction.
iii. Withdrawal of Objection Prior to Hearing
CWA section 401(a)(2) states that if a notified neighboring
jurisdiction notifies EPA and the Federal agency ``in writing of its
objection to the issuance of [the] license or permit and requests a
public hearing on such objection, the licensing or permitting agency
shall hold such a hearing.'' 33 U.S.C. 1341(a)(2). Therefore, for a
hearing to be required under section 401(a)(2), there must be (1) a
written objection from the notified neighboring jurisdiction and (2) a
request for a public hearing on the objection. Id. EPA proposed that if
one of these elements were not present, then the Federal agency would
not be required to hold a hearing and requested comment on whether to
develop regulatory text for a process where the neighboring
jurisdiction could withdraw its objection and eliminate the requirement
to hold a public hearing. 87 FR 35370.
EPA received numerous comments recommending that it include
language allowing notified neighboring jurisdictions to withdraw their
objections before the hearing, thus, eliminating the need to hold a
public hearing. Some of these commenters stated that allowing the
neighboring jurisdiction to withdraw its objection is in line with
section 401's cooperative federalism scheme, while other commenters
stated that allowing for withdrawal provides for efficiency in the
Federal licensing or permitting process. EPA agrees that including a
provision addressing withdrawal of an objection improves the efficiency
of the neighboring jurisdictions process, as it recognizes the
possibility that neighboring jurisdictions may be able to resolve
objections before the hearing stage of the neighboring jurisdictions
process, conserving resources that would otherwise be expended to
conduct and participate in such a hearing in these circumstances. EPA
observes that nothing in the statute prohibits withdrawal of an
objection, which would remove the prerequisite condition for a Federal
agency to hold a public hearing. EPA also finds that including a
provision addressing the circumstances of withdrawal provides added
clarity by establishing a uniform procedure for executing withdrawal of
an objection. Accordingly, EPA has included a provision in Sec.
121.14(c) that allows a notified neighboring jurisdiction to withdraw
its objection prior to the public hearing. The final rule states that
if the notified neighboring jurisdiction withdraws its objection, it
shall notify the Regional Administrator and Federal agency in writing
of the withdrawal. See 40 CFR 121.14(c). If the neighboring
jurisdiction withdraws the objection, the Federal agency will not need
to proceed with a public hearing and can move forward with issuing the
Federal license or permit. EPA has also added language to this effect
at Sec. 121.15(a). It should be noted that the Federal agency might
have to comply with its own public notice procedures if it agreed to
add certain Federal license or permit conditions in return for
withdrawal of the objection.
h. Objection and Public Hearing Process Under Section 401(a)(2)
CWA section 401(a)(2) requires the Federal licensing or permitting
agency to hold a public hearing on the objection of a notified
neighboring jurisdiction if such neighboring jurisdiction provides
notification of its objection and request for hearing in the required
60-day timeframe. 33 U.S.C. 1341(a)(2). As explained above, EPA is
adding language to Sec. 121.15(a) which clarifies that if the
neighboring jurisdiction withdraws its objection, then the Federal
agency does not have to proceed with a public hearing. Otherwise,
consistent with section 401(a)(2), the final rule provides that the
Federal agency must hold the public hearing upon a request for hearing
from a notified neighboring jurisdiction in accordance with the
requirements for the notification and request for hearing
[[Page 66650]]
in Sec. 121.14(b) of the final rule. 40 CFR 121.15(a).
Section 401(a)(2) does not provide for a specific process for the
public hearing conducted by the Federal licensing or permitting agency.
It merely states that the hearing is public and shall be held by the
Federal licensing or permitting agency. 33 U.S.C. 1341(a)(2). The
statute further provides that the EPA Administrator must submit an
evaluation and recommendations regarding the objection at the hearing.
Id. Further, section 401(a)(2) states that additional evidence may be
presented at the hearing. After the public hearing, the Federal
licensing or permitting agency must consider the recommendations of the
neighboring jurisdiction and EPA Administrator as well as any
additional evidence presented at the hearing and, based on that
information, must condition the Federal license or permit as may be
necessary to ensure compliance with applicable water quality
requirements. If additional conditions cannot ensure compliance with
applicable water quality requirements, the Federal agency shall not
issue the license or permit. Id. Notably, the statute is silent as to
whether public notice of the public hearing is required; the nature of,
and specific procedures for, the public hearing; the need for a court
reporter or transcript; whether the Federal licensing or permitting
agency's decision is appealable; and other such matters.
The Agency proposed to add transparency to the neighboring
jurisdictions process by requiring the Federal agency to provide for a
minimum of a 30-day public notice of the hearing, but declined to
define the type of public hearing that the Federal agency must hold.
Commenters provided various recommendations regarding the Federal
agency's public hearing, including those addressing the notice of
hearing, hearing procedures, and the location of a hearing. One
commenter, who supported EPA's approach to the public hearing process,
suggested that EPA should develop hearing procedures that can act as a
default for Federal agencies that do not have public hearing
procedures. On the other hand, another commenter stated that EPA should
not impose a minimum notice requirement for the public hearing.
EPA is finalizing the proposed requirement that the Federal agency
must provide notice at least 30-days prior to the public hearing, but
is adding text to clarify that only a notified neighboring jurisdiction
can make a request for hearing, and specify that the Federal agency
must provide such public notice to interested parties. Consistent with
revisions to Sec. 121.14 of the final rule, discussed above, EPA is
adding language to Sec. 121.15 of the final rule to make clear that
pursuant to section 401(a)(2) only a notified neighboring jurisdiction
may provide notification of an objection and request a hearing.
Additionally, EPA is adding language in Sec. 121.15(b) that requires
the Federal agency to provide public notice ``to interested parties,
including but not limited to the notified neighboring jurisdiction, the
certifying authority, the project proponent, and the Regional
Administrator,'' at least 30 days prior to the public hearing. 40 CFR
121.15(b). This language was included to ensure that all interested
parties will have notice of the public hearing such that they can
prepare for and provide their testimony or comments at the public
hearing.
The Agency is otherwise maintaining the approach of not defining
the type of public hearing that the Federal agency must hold, since
many Federal agencies have their own regulations regarding public
hearings on licenses and permits, and the Federal agencies are better
suited to determine the appropriate process for holding their own
public hearings. However, EPA recommends that the Federal agency accept
comments and additional evidence on the objection at the public
hearing. EPA also defers to the Federal agency to decide whether the
public hearing would be conducted in-person and/or remotely through
telephone, online, or other virtual platforms depending on the
circumstances and the Federal agency's public hearing regulations. In
determining the method for conducting the hearing and hearing location,
EPA encourages the Federal agency to take into consideration the
purpose of CWA section 401(a)(2) to establish a mechanism allowing
notified neighboring jurisdictions an opportunity to object to the
issuance of a Federal license or permit in circumstances where they
find a discharge from the licensed or permitted project will violate
their water quality requirements. Thus, interested parties, which
include representatives of the neighboring jurisdiction, should be able
to easily attend the public hearing.
As previously mentioned, section 401(a)(2), also establishes a role
for EPA at the public hearing, providing that the Agency ``shall . . .
submit [its] evaluation and recommendations with respect to any such
objection to the licensing or permitting agency'' at the public
hearing. 33 U.S.C. 1341(a)(2). Consistently, EPA is finalizing Sec.
121.15(c) as proposed which mirrors the statute by stating that ``[a]t
the hearing, the Regional Administrator shall submit to the Federal
agency its evaluation and recommendation(s) concerning the objection.''
40 CFR 121.15(c). As stated in its proposal, EPA interprets its role in
providing the evaluation and recommendations on the notified
neighboring jurisdiction's objection as that of an objective and
neutral evaluator providing recommendations to the Federal licensing or
permitting agency based upon its expert, technical analysis of the
record before it. 87 FR 35369. EPA intends to conduct its evaluation
and make any recommendations based on the information before it, giving
equal consideration to the information and views--if provided--by
interested parties, including the objecting neighboring jurisdiction,
project proponent, and certifying authority. Id. Consistent with this
approach, as a general matter EPA does not intend to invite public
comment and input from, or engage with, interested parties when
developing its evaluation and recommendations on the objection.
However, EPA may, where it deems it appropriate, seek additional
information regarding a notified neighboring jurisdiction's objection
to be sure EPA is able to develop an informed and well-supported
evaluation and accompanying recommendations. This approach to
developing its evaluation and recommendations is consistent with the
hearing process established by section 401(a)(2), which recognizes a
role for the notified neighboring jurisdiction independent of the
Agency and allows for presentation of evidence at the hearing by any
interested stakeholder, including the notified neighboring
jurisdiction. If a stakeholder agrees or disagrees with EPA's
evaluation and recommendations presented at the hearing, such
stakeholder may have an opportunity to provide additional information
and comment directly to the Federal agency for its consideration.
After conducting the public hearing, pursuant to CWA section
401(a)(2), the Federal licensing or permitting agency must consider the
recommendations of the notified neighboring jurisdiction and EPA, as
well as any additional evidence presented at the hearing, as it
determines whether additional permit or license conditions are
necessary to ensure compliance with applicable water quality
requirements. 33 U.S.C. 1341(a)(2). The Act does not accord special
status to EPA's evaluation and recommendations compared with the
notified neighboring jurisdiction's input
[[Page 66651]]
or other evidence received at the hearing; rather, the section appears
to contemplate that the Federal agency will consider all of the
information presented in making its decision.
If the Federal licensing or permitting agency determines that
additional conditions may be necessary to ensure compliance with the
neighboring jurisdiction's water quality requirements, the Federal
licensing or permitting agency must include those conditions in the
Federal license or permit pursuant to section 401(a)(2). 33 U.S.C.
1341(a)(2). In addition, if the Federal licensing or permitting agency
cannot include conditions that will ensure compliance with applicable
water quality requirements, the Federal agency cannot issue the Federal
license or permit. Id. EPA is finalizing regulatory text that
specifically incorporates these statutory requirements. 40 CFR
121.15(d) and (e). If the Federal agency decides that conditions are
necessary to ensure that a project will comply with a neighboring
jurisdiction's water quality requirements, EPA notes that the Federal
agency may also have to comply with its own public notice and comment
requirements before finalizing the Federal license or permit.
A few commenters provided input on how the Federal agency should
engage with stakeholders after the conclusion of the public hearing.
EPA declines to prescribe how a Federal agency must engage with
stakeholders after the public hearing. However, EPA encourages the
Federal agency to consult with the objecting neighboring jurisdiction
and certifying authority, as well as all necessary parties, before
making a decision under CWA section 401(a)(2).
EPA did not propose to establish a deadline by which the Federal
licensing or permitting agency must make a determination after the
public hearing on the notified neighboring jurisdiction's objection but
requested comment on whether such a deadline should be established. A
few commenters recommended that EPA create a timeline of the
neighboring jurisdictions process and specifically include timelines
for establishing a public hearing, making determinations, and finishing
the post-public hearing process. Several commenters recommended that
EPA establish a deadline for the Federal agency to make a decision
after the public hearing on the objection. At least one commenter
stated that establishing a deadline would be inappropriate and
inconsistent with CWA section 401(a)(2), arguing that Congress
consciously chose not to impose a deadline on the Federal agency and
did not include language that would allow EPA to establish a deadline.
In the final rule, the Agency is declining to add specific timelines
for the neighboring jurisdictions process beyond those already
established in the statute. There are many factors, including the
complexity of the facts at issue in an objection and a Federal agency's
own regulations, that impact the duration of time necessary for a
Federal agency to complete its determination following a hearing on a
neighboring jurisdiction's objection. However, EPA encourages Federal
agencies to communicate with the notified neighboring jurisdiction and
other interested stakeholders regarding its expectations or
considerations in determining the time to make a decision on the
Federal license or permit after a public hearing.
3. Implementation
As discussed in detail above, once a Federal agency receives a
Federal license or permit application and a certification or waiver, it
may proceed with the neighboring jurisdictions process (i.e., notify
EPA as required under this final rule). The Agency wishes to reiterate
that all certifications or waivers will trigger the neighboring
jurisdictions process, even those for minor or remote projects. The
requirement to notify EPA under section 401(a)(2) depends on the
Federal agency's receipt of a Federal license or permit application and
certification or waiver; it does not depend on the location of the
project or the nature of the Federal license or permit. The Agency is
aware that there are instances where a Federal license or permit
application does not accompany a certification or waiver (e.g.,
certification on general permits or Corps civil works projects).
Certifications or waivers on those projects are not exempt from the
neighboring jurisdictions process. Rather, EPA expects Federal agencies
to determine how best to comply with all section 401 requirements. For
example, on a Corps civil works project, compliance may involve the
Corps sending a project study in conjunction with a certification or a
waiver of certification. Ultimately, EPA is responsible for determining
whether a discharge from a project may affect the water quality of a
neighboring jurisdiction. As stated in Sec. 121.13(d) of the final
rule, and discussed above, a Federal agency cannot issue a license or
permit pending the conclusion of the neighboring jurisdictions process,
set forth in Sec. Sec. 121.13, 121.14, and 121.15 of the final rule.
Several commenters discussed the need for collaboration between EPA
and other stakeholders prior to the initiation of the neighboring
jurisdictions process. EPA agrees that early coordination can generally
be beneficial to all parties, though this may not always be necessary
depending on project complexity and resources. The Agency has
encouraged early coordination and communication throughout the final
rule, including pre-filing meeting requests and request for
certification. Additionally, EPA observes that section 401 requires
certifying authorities to develop public notice procedures for requests
for certification. See 33 U.S.C. 1341(a)(1). A certifying authority's
public notice procedures for certification could provide an additional
opportunity for neighboring jurisdictions and other stakeholders to
participate in the process. Generally, early engagement can provide
stakeholders the opportunity to communicate needs and requirements,
potentially streamlining processes and helping ensure any concerns are
noted and addressed. EPA disagrees with one commenter's assertion that
EPA has a responsibility to proactively work with project proponents
and other Federal agencies as early as possible in the Federal
licensing or permitting process. As discussed above, EPA has a
specific, statutorily defined role in the neighboring jurisdictions
process, which does not require the Agency to proactively coordinate
with other Federal agencies or project proponents or take any action
pursuant to section 401(a)(2) prior to receiving notice from the
Federal agency of its receipt of the application and either a
certification or waiver.
L. Treatment in a Similar Manner as a State Under Section 401
1. What is the Agency finalizing?
The Agency is finalizing the proposed provisions enabling Tribes to
obtain TAS solely for section 401, as well as provisions on how Tribes
can obtain TAS for the limited purpose of participating as a
neighboring jurisdiction under section 401(a)(2).\107\ Section 121.11
of the final rule includes the criteria an applicant Tribe would be
[[Page 66652]]
required to meet to be treated in a similar manner as states, the
information the Tribe would be required to provide in its application
to EPA, and the procedure EPA would use to review the Tribal
application.
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\107\ Prior to this final rule, in the absence of TAS provisions
tailored specifically for section 401, Tribes had received TAS for
section 401 when eligible for TAS to administer the section 303(c)
program for water quality standards. 40 CFR 131.4(c) (``Where EPA
determines that a Tribe is eligible to the same extent as a State
for purposes of water quality standards, the Tribe likewise is
eligible to the same extent as a State for purposes of
certifications conducted under Clean Water Act section 401.'').
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Consistent with the requirements provided in CWA section 518, the
final rule requires that four criteria must be met for Tribes to obtain
TAS for section 401, including section 401(a)(2). First, the Tribe must
be federally recognized by the U.S. Department of the Interior and meet
the definitions finalized in Sec. 121.1(d) and (e). Second, the Tribe
must have a governing body that carries out ``substantial governmental
duties and powers'' over a defined area. Third, the Tribe must have
appropriate authority to regulate and manage water resources within the
borders of the Tribe's reservation. Lastly, the Tribe must be
reasonably expected, in the Regional Administrator's judgment, to be
capable of administering a section 401 water quality certification
program.
The Tribe may satisfy the first criterion by stating that it is
included on the list of federally recognized Tribes that is published
periodically by the U.S. Department of the Interior. Alternatively, the
Tribe may submit other appropriate documentation (e.g., if the Tribe is
not yet included on the U.S. Department of the Interior list but is
federally recognized).
To meet the second criterion, the Tribe would show that it conducts
``substantial governmental duties and powers,'' which the Agency views
as performing governmental functions to promote the health, safety, and
welfare of the affected population within a defined geographical area.
See 54 FR 39101; 81 FR 65906. This requires a descriptive statement
that (1) describes the form of Tribal government, (2) describes the
types of essential governmental functions currently performed by the
Tribal governing body, including but not limited to, the exercise of
the power of eminent domain, taxation, and police power, and (3)
identifies the sources of authorities to carry out these functions.
To meet the third criterion that the Tribe has the authority to
manage the water resources within the borders of the Tribe's
reservation, the Tribe would submit a descriptive statement comprised
of two components: (1) a map or legal description of the area over
which the Tribe has authority to regulate surface water quality, and
(2) a statement signed by the Tribe's legal counsel or equivalent
explaining the legal basis for the Tribe's regulatory authority. EPA
notes that section 518 of the CWA includes a delegation of authority
from Congress to eligible Indian Tribes to regulate the quality of
waters of their reservations under the CWA. See 81 FR 30183 (May 16,
2016). Absent rare circumstances that may affect a Tribe's ability to
effectuate the delegation of authority, Tribes may rely on the
congressional delegation of authority included in section 518 of the
statute as the source of authority to administer a section 401 water
quality certification program. This is identical to the way Tribes have
been demonstrating authority for eligibility to administer 401
certifications under existing TAS regulations, the only change being
that under the final regulations, Tribes will be able to seek TAS
eligibility for section 401 only. Similarly, as with Tribes already
administering section 401 under prior TAS approvals, the authority to
issue certifications exercised by a Tribe authorized under the new
regulation will, by virtue of the congressional delegation, apply
throughout the reservation area covered by the TAS approval,
irrespective of land ownership or the Tribal membership status of the
Federal license or permit applicant. See, e.g., 81 FR 30190. Therefore,
grants or waivers of certification by an authorized Tribe, as well as
any conditions included in a certification or denials of certification
by an authorized Tribe, would apply to any application for a Federal
license or permit throughout the relevant reservation without any
separate need to demonstrate inherent Tribal jurisdiction.
A Tribe may satisfy the fourth criterion regarding its capability
by either (1) providing a description of the Tribe's technical and
management skills to administer a water quality certification program
or (2) providing a plan that proposes how the Tribe will acquire such
skills. Additionally, when considering Tribal capability, EPA would
also consider whether the Tribe can demonstrate the existence of
institutions that exercise executive, legislative, and judicial
functions, and whether the Tribe has a history of successful managerial
performance of public health or environmental programs.
Section 121.11 of the final rule is intended to ensure that Tribes
treated in a similar manner as states for the purposes of the section
401 water quality certification program are qualified, consistent with
CWA requirements, to implement a water quality certification program.
The procedures are meant to provide more opportunities for Tribes to
engage fully in the program and are not intended to act as a barrier to
Tribal administration of the section 401 program. The procedures are
modeled after the TAS regulatory provisions for the CWA section 303(c)
water quality standards (WQS) program, located at 40 CFR 131.8, and the
TAS provisions for the CWA section 303(d) impaired water listing and
total maximum daily load program, located at 40 CFR 130.16. The WQS TAS
regulations, developed in the early 1990s, have acted as a model for
other programs including the section 303(d) regulations. See 81 FR
65905. Additionally, EPA's TAS regulations allow Tribes to
simultaneously obtain TAS for sections 303(c) and 401. As a result, the
part 131 and part 130 TAS regulations provide an appropriate model for
this final rule.
These provisions provide more opportunities and clarity for Tribes
interested in participating in the section 401 certification process.
Although the CWA clearly allows Tribes to obtain TAS for section 401,
current regulations and practice treat TAS for section 401 as an
adjunct to TAS for the CWA section 303(c) program for water quality
standards. To date, 83 federally recognized Tribes (out of 574) have
received TAS for section 401 concurrently with obtaining TAS for
section 303(c).\108\ The TAS provisions in this final rule do not
eliminate or modify the section 401 procedures already found in part
131. Instead, they provide an alternate path for Tribes wishing to
obtain TAS status only for section 401 and not also for section 303(c).
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\108\ See https://www.epa.gov/tribal/tribes-approved-treatment-state-tas. To date, one Tribe with TAS for section 303(c) (Havasupai
Tribe in Arizona) has declined TAS for section 401.
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Upon receiving TAS for section 401, Tribes have two roles. First,
Tribes that receive section 401 TAS are responsible for acting as a
certifying authority for projects that may result in a discharge into
waters of the United States on their Indian reservations. As certifying
authorities, Tribes with TAS may grant, grant with conditions, deny, or
waive certification based on whether a federally licensed or permitted
project will comply with sections 301, 302, 303, 306, and 307 of the
CWA and any other appropriate requirements of Tribal law. See 33 U.S.C.
1341(a)(1) and (d). Second, Tribes that receive section 401 TAS are
accorded the status of ``neighboring jurisdiction'' for purposes of
section 401(a)(2). If EPA makes a ``may affect'' finding during its
determination with respect to that neighboring jurisdiction, the
notified neighboring jurisdiction, including Tribes with TAS for
section 401 and
[[Page 66653]]
Tribes with TAS for section 401(a)(2), may object to the issuance of
the Federal license or permit if they determine that a discharge from
the project ``will violate'' any of its water quality requirements and
request a public hearing from the Federal licensing or permitting
agency. 33 U.S.C. 1341(a)(2); 40 CFR part 121, subpart B.
2. Summary of Final Rule Rationale and Public Comment
The final rule's inclusion of TAS provisions solely for section 401
and 401(a)(2) provides alternate paths for Tribes to engage in the
section 401 process without also needing to apply for section 303(c),
promoting cooperative federalism and Tribal rights. Many of the
commenters addressing the proposal to add provisions enabling Tribes to
obtain TAS solely for section 401 and for section 401(a)(2) expressed
support for finalizing the proposed TAS provisions. These commenters
supported the inclusion of section 401 TAS provisions for various
reasons including interest in supporting Tribal agency, increasing
Tribal participation in Federal licensing and permitting processes,
providing Tribes a tool for protecting water quality and treaty rights,
recognizing the vast knowledge of Tribal communities and their
sovereignty, respecting the role waters play in Tribal cultures, and
affording Tribes more options regarding administration of CWA programs.
EPA appreciates these commenters' support. Promulgating a
regulation expressly providing a process and requirements for section
401 TAS in the absence of section 303(c) TAS is consistent with section
518 and would provide clarity and increased opportunities for
interested Tribes to participate in section 401. CWA section 518
authorizes the Agency to treat eligible Tribes with reservations in a
similar manner to states ``for purposes of subchapter II of this
chapter and sections . . . 1341, . . . of this title to the degree
necessary to carry out the objectives of this section.'' See 33 U.S.C.
1377(e). Section 518(e) establishes eligibility criteria for TAS.\109\
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\109\ Section 518(e) authorizes EPA to treat eligible Tribes in
a similar manner as a state if (1) the Indian tribe has a governing
body carrying out substantial governmental duties and powers; (2)
the functions to be exercised by the Indian tribe pertain to the
management and protection of water resources which are held by an
Indian tribe, held by the United States in trust for Indians, held
by a member of an Indian tribe if such property interest is subject
to a trust restriction on alienation, or otherwise within the
borders of an Indian reservation; and (3) the Indian tribe is
reasonably expected to be capable, in the Administrator's judgment,
of carrying out the functions to be exercised in a manner consistent
with the terms and purposes of this chapter and of all applicable
regulations. See 33 U.S.C. 1377(e).
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Additionally, developing regulations on section 401 TAS as a
standalone process for Tribes seeking this authority who are not
concurrently applying for section 303(c) TAS may encourage more Tribes
to seek TAS for section 401. Decoupling section 401 TAS from section
303(c) recognizes that section 401 and section 303(c) administration
are related, but distinct functions and is responsive to Tribal
stakeholders who have expressed an interest in participating in the
section 401 certification process.
However, EPA recognizes that some Tribes may not desire or have the
resources to apply for the section 401 certification program. Pre-
proposal input suggested that Tribes may wish to be notified about and
have the ability to object to and provide information regarding,
potential Federal licenses and permits that may impact their waters.
Several Tribal stakeholders have expressed concern that Tribes without
TAS are not able to participate in the section 401(a)(2) neighboring
jurisdictions process. In response to pre-proposal input, EPA proposed
a separate TAS provision for the section 401(a)(2) neighboring
jurisdictions process. Many commenters from the public comment period
indicated support for the proposed TAS provisions, including
specifically for section 401(a)(2). Commenters asserted that waters on
reservations are susceptible to degradation from upstream discharges
and that the TAS provisions for section 401(a)(2) provided a mechanism
for objecting and requesting a hearing on the issuance of Federal
licenses and permits for those discharges while limiting administrative
burdens associated with obtaining TAS for section 401(a)(1). As a
result of this input, EPA is finalizing as proposed to provide Tribes
with an opportunity to seek TAS authorization for the limited purpose
of being a neighboring jurisdiction pursuant to section 401(a)(2). The
final rule promotes Tribal engagement by providing an opportunity for
Tribes to protect their water quality through participating in the
section 401 certification process without needing to assume all of the
authorities and responsibilities of section 401. Tribes applying for
TAS solely for section 401(a)(2) will still need to meet the same four
criteria discussed above. However, since participating as a neighboring
jurisdiction under section 401(a)(2) does not involve any exercise of
regulatory authority and involves carrying out fewer functions than
acting as a certifying authority, EPA anticipates that demonstrations
that the applicant Tribe satisfies the criteria will be more
streamlined than the demonstrations in applications for TAS for
purposes of administering the entirety of section 401. See discussion
infra.
Some commenters expressed concern about the addition of TAS
provisions for section 401 and section 401(a)(2). Some of these
commenters asserted that section 401 is limited to ensuring compliance
with EPA-approved water quality standards, and they questioned how
Tribes without EPA-approved water quality standards under section
303(c) of the Clean Water Act would implement section 401. EPA
disagrees that section 401 is limited to ensuring compliance with Clean
Water Act section 303(c) water quality standards. The term ``water
quality requirements'' is used throughout section 401, and EPA has
defined ``water quality requirements'' to include any limitation,
standard, or other requirement under the provisions enumerated in
section 401(a)(1), any Federal and state or Tribal laws or regulations
implementing the enumerated provisions, and any other water quality-
related requirement of state or Tribal law regardless of whether they
apply to point or nonpoint source discharges. 40 CFR 121.1(j). Under
this approach, authorized Tribes can base their section 401
certification decisions on compliance with water quality requirements
other than Tribal water quality standards approved under section
303(c). Examples include Tribal ordinances or other Tribal laws related
to water quality, or, if present, Federal water quality standards
promulgated by EPA for reservation waters.\110\
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\110\ Federal water quality standards are currently in place for
the Confederated Tribes of the Colville Reservation. See 40 CFR
131.35. EPA recently published a proposed rule that would establish
Federal baseline water quality standards for waters on Indian
reservations that do not have water quality standards in effect for
CWA purposes. 88 FR 29496 (May 5, 2023). Upon finalizing the rule,
those Federal baseline water quality standards would serve as the
applicable water quality standards in effect for CWA purposes.
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Other commenters who raised concerns about the TAS provisions
requested that EPA provide explicit acknowledgement of the specific
circumstances regarding Oklahoma's authority under the Safe,
Accountable, Flexible, Efficient Transportation Equity Act of 2005
(SAFETEA). Some of these commenters said that EPA should note that the
TAS provisions for section 401 and section 401(a)(2) are subject to
limitations consistent with this authority.
[[Page 66654]]
EPA holds that the provisions in this final rule for obtaining TAS
for section 401 and section 401(a)(2) have no effect on the separate
TAS requirement of section 10211(b) of SAFETEA. Additionally, the
section 401(a)(2) neighboring jurisdiction role is similar to the
affected state commenting role established under section 505(a)(2) of
the Clean Air Act. See 87 FR 35372 (June 9, 2022). Functioning as a
neighboring jurisdiction under section 401(a)(2) does not involve any
exercise of regulatory authority by a Tribe (or state) who may be
affected by a federally licensed or permitted discharge from a
neighboring jurisdiction. The neighboring jurisdiction role involves an
opportunity to provide input regarding water quality impacts and to
inform decision making of the Federal licensing or permitting agency.
Ultimately, it is the Federal agency that exercises regulatory
authority through its licensing or permitting decision, and the
certifying authority in the neighboring state or Indian reservation
where the discharge originates that exercises authority to grant, grant
with conditions, deny, or waive certification. The section 401(a)(2)
neighboring jurisdiction role is similar to the affected state
commenting role established under section 505(a)(2) of the Clean Air
Act. See 87 FR 35372.
3. Implementation
As this final rule includes TAS provisions solely for section 401
and section 401(a)(2) for the first time, the Agency is developing
materials to aid the implementation of this aspect of the final rule.
To implement the TAS provisions in this rule, EPA will need to
communicate how Tribes can apply and process any incoming TAS
applications from Tribes. This implementation section also includes
discussion of how Tribes can implement a certification program or
participate in the neighboring jurisdictions process if they obtain TAS
for section 401 and/or section 401(a)(2).
Commenters requested that EPA provide transparency on TAS
applications through establishing guidelines for applying and
identifying necessary materials for applications, as well as keeping
applicant Tribes updated on their application status. EPA agrees that
the TAS application process should be transparent and has included
provisions in this final rule to create clarity and efficiencies in the
application process. To provide direction on how a Tribe may meet the
criteria described in section IV.L.1 of this preamble, EPA has
described the contents of an application for TAS for section 401. See
40 CFR 121.11(b). To assist applicant Tribes, the Agency is also
developing a template which would provide explanations and instructions
for documenting how the Tribe meets the eligibility requirements. The
template would consist of areas for Tribes to include a statement that
the Tribe is recognized by the Secretary of the Interior, a descriptive
statement that demonstrates the Tribal government carries out
substantial duties and powers, a descriptive statement of the Tribe's
authority to regulate water quality, and a narrative statement that
describes the Tribe's capability to administer a section 401 water
quality certification program. Consistent with existing TAS regulations
for other programs, this final rule also provides that Tribal
applicants include additional documentation that may be required by EPA
to support the Tribal application. Each TAS application will present
its own set of legal and factual circumstances, and EPA anticipates
that in some cases it may be necessary to request additional
information when reviewing a Tribe's application. Such requests would,
for instance, generally relate to ensuring that the application
contains sufficient complete information to address the required
statutory and regulatory TAS criteria. This could include, for
instance, information relating to a unique issue pertaining to the
applicant Tribe or its reservation or an issue identified during the
comment process described below. Consistent with longstanding practice,
the Agency would work with Tribes in an appropriately streamlined
manner to ensure that their TAS applications contain all necessary
information to address applicable statutory and regulatory criteria. If
a Tribe has previously qualified for TAS under another EPA program, the
Tribe is only required to submit information that was not previously
submitted as part of a prior TAS application.
The final rule also describes EPA's procedures to review and
process an application for section 401 TAS. See 40 CFR 121.11(c). Once
EPA receives a complete Tribal application, it will promptly notify the
Tribe of receipt and process the application in a timely manner. Within
30 days after receipt of the Tribe's complete application for section
401 TAS, EPA shall provide notice to appropriate governmental entities
\111\ of the application, including information on the substance of and
basis for the Tribe's assertion of authority to regulate reservation
water quality. Appropriate governmental entities will be given 30 days
to provide comment on the Tribe's assertion of authority. Consistent
with prior practice regarding such notice in connection with TAS
applications for other programs, EPA also intends to provide
sufficiently broad notice (e.g., through local newspapers, electronic
media, or other appropriate media) to inform other potentially
interested entities of the applicant Tribe's complete application and
of the opportunity to provide relevant information regarding the
Tribe's assertion of authority. If the Tribe's assertion of authority
is challenged, EPA will determine whether the Tribe has adequately
demonstrated authority to regulate water quality on the reservation
after considering all relevant comments received.
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\111\ EPA defines the term ``appropriate governmental entities''
as ``States, tribes, and other Federal entities located contiguous
to the reservation of the tribe which is applying for treatment as a
State.'' 56 FR 64876, 64884 (December 12, 1991).
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However, if a Tribe previously qualified for TAS for another
program that also required a Tribe to demonstrate authority to regulate
reservation water quality (i.e., CWA section 303(c) program, CWA
section 303(d) program, CWA section 402 program, or CWA section 404
program) and EPA provided a notice and comment opportunity, the Agency
would not require notice on the Tribe's assertion of authority to
appropriate governmental entities in the section 401 TAS application
unless there were different jurisdictional issues or significant new
factual or legal information relevant to jurisdiction. EPA thinks this
approach could help streamline the process and avoid a potentially
duplicative notice process. This approach will apply prospectively
only, i.e., where the Tribe obtains TAS for the CWA section 303(c),
402, or 404 programs after the effective date of this rule. In other
words, if a Tribe first gains TAS for another CWA regulatory program
after this rule is effective, and subsequently seeks TAS under this
rule, additional notice and comment would not be required as part of
the section 401 TAS application unless different jurisdictional issues
or significant new factual or legal information relevant to
jurisdiction are presented in the section 401 TAS application. If the
Regional Administrator determines that a Tribe's application meets the
requirements in Sec. 121.11(b), the Regional Administrator will
promptly notify the Tribe in writing. A decision by the Regional
Administrator that a Tribe does not meet the requirements in Sec.
121.11(b) would not preclude the Tribe from resubmitting the
application at a future date. If the Regional Administrator
[[Page 66655]]
determines that a Tribal application is deficient or incomplete, EPA
will identify such deficiencies and gaps so the Tribe can make changes
as appropriate and necessary.
M. Implementation Considerations
EPA recognizes that both certifying authorities and Federal
agencies have existing regulations addressing implementation of section
401. For example, as discussed in section IV.C in this preamble, the
Agency is aware that some certifying authorities have regulations
defining the contents of a request for certification. As a result of
this rulemaking effort, certifying authorities may choose to modify
their existing regulations (e.g., they may choose to define the
contents of a certification request instead of relying on EPA's
definition). Similarly, EPA is aware that the Corps and FERC have
separate section 401 implementation regulations addressing their
respective Federal licensing or permitting programs.\112\ EPA expects
that Federal agencies with existing section 401 implementing
regulations will evaluate their regulations and other guidance
documents to ensure consistency with this final rule.
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\112\ See e.g., 33 CFR 325.2 (water quality certification on
section 404 permits); 18 CFR 4.34 (water quality certification on
FERC hydropower licenses).
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Given that EPA intends many of the provisions of the final rule to
represent a return to past practices with added clarity, the Agency
anticipates that implementation of the final rule will not require a
significant overhaul of state, Tribal, or other Federal regulations.
EPA will support implementation of the final rule through training
sessions for each of the various stakeholder groups, as well as through
engagement with an interagency Federal CWA section 401 workgroup.
The Agency also wishes to clarify the applicability of the final
rule to ongoing certification actions. As of the effective date of this
final rule, which will be 60 days after publication of the final rule
in the Federal Register, all actions taken as part of the section 401
certification process must be taken pursuant to the final rule.
However, the final rule does not apply retroactively to actions already
taken under the 2020 Rule. For example, if a certifying authority
received a request for certification, prior to the effective date of
this final rule, and the certifying authority has not acted on the
request for certification as of the effective date, any decision issued
by the certifying authority after the effective date of this final rule
must comply with the requirements in the final rule (e.g., scope of
certification) and any Federal agency review of a certification
decision must comply with Sec. 121.8. However, the validity of the
request for certification would be determined under the 2020 Rule and
the project proponent would not need to re-request certification
consistent with the final rule. The certifying authority may request
more information to help inform its decision-making on the request for
certification, including information relevant to determining water-
quality impacts from the activity subject to certification, but the
certifying authority must still issue its certification decision within
the reasonable period of time, which would not pause while the
certifying authority is seeking more information.\113\ A ``reasonable
period of time'' determined under the 2020 Rule prior to the effective
date of the final rule would not automatically change because this
final rule went into effect; however, the certifying authority may
request an extension to the reasonable period of time pursuant to Sec.
121.6(e) of the final rule, or avail itself to an automatic extension
to the reasonable period of time pursuant to Sec. 121.6(d)--provided
that the reasonable period of time does not exceed one year from the
date that the request for certification was received. Additionally,
after the effective date, if a project proponent has not submitted a
request for certification or if the project proponent has only
submitted a pre-filing meeting request by the time the final rule goes
into effect, the project proponent is responsible for submitting a
request for certification in accordance with Sec. 121.5 of the final
rule. Finally, after the effective date, a certifying authority and
Federal agency can apply the final rule's modification process at Sec.
121.10 to any certification decision, even if that decision was
provided while a prior rule (e.g., 1971 Rule or 2020 Rule) was in
effect.\114\ Similarly, if a Federal agency determined pursuant to the
2020 Rule and prior to the effective date of the final rule that a
certifying authority constructively waived certification for failure to
comply with the procedural requirements of the 2020 Rule, that
determination is not affected by this final rule going into effect,
even if the relevant Federal license or permit has not yet been issued.
As discussed above, if a ``reasonable period of time'' was established
under the 2020 Rule prior to the effective date of the final rule, that
reasonable period of time would not automatically change because this
final rule went into effect.
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\113\ Under both this final rule and the 2020 Rule, a certifying
authority may request more information to help inform its decision-
making after a request for certification is made and the reasonable
period of time has begun. See section IV.C of this preamble and 85
FR 42245 (July 13, 2020) (``Nothing in the final rule's definition
of ``certification request'' precludes a project proponent from
submitting additional, relevant information or precludes a
certifying authority from requesting and evaluating additional
information within the reasonable period of time'').
\114\ However, if the relevant Federal license or permit has not
yet been issued, the project proponent could request certification
anew, and the certifying authority would then need to act on that
request consistent with this final rule.
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The approach the Agency adopts here regarding the applicability of
the final rule to ongoing certification actions is consistent with the
approach taken by the Agency after a court vacatur of the 2020 Rule in
2021 and the Supreme Court's stay of that vacatur in 2022. See section
III.C.3 for background on the litigation to the 2020 Rule. The Agency
is not aware of any disruptions or delays in the certification process
as the result of the Agency's approach to ongoing certification actions
in those instances.
N. Severability
The purpose of this section is to clarify the Agency's intent with
respect to the severability of provisions of this rule in the event of
litigation. In the event of a stay or invalidation of any part of this
rule, the Agency's intent is to preserve the remaining portions of the
rule to the fullest possible extent. To dispel any doubt regarding
EPA's intent and to inform how the regulation would operate if severed,
EPA has added the following regulatory text at Sec. 121.19: ``The
provisions of this part are separate and severable from one another. If
any provision is stayed or determined to be invalid, the remaining
provisions shall continue in effect.'' The Agency would have adopted
each portion of this rule independent of the other portions. As
explained below, the Agency carefully crafted this rule so that each
provision or element of the rule is capable of operating independently.
Moreover, the Agency has organized the rule so that if any provision or
element of this rule is determined by judicial review or operation of
law to be invalid, that partial invalidation will not render the
remainder of this rule invalid.
Section 121.3 regarding the scope of review for certification
decisions is a good example of how the Agency structured the final rule
so its various provision and elements operate independently. The
provisions regarding scope operate entirely independently from the
other provisions of this rule, as Sec. 121.3, which concerns scope, is
not cross-referenced or necessary for the operation of any other
section of part 121 or any other EPA
[[Page 66656]]
regulation. The other provisions of this rule operate the same
regardless of whether the scope of certification is water quality-
related impacts from the full activity subject to the Federal license
or permit or only its point source discharges. First, the rule's
provisions regarding when certification is required (Sec. 121.2) would
be the same regardless of the scope of certification. The Agency's
rationale for when certification is required does not rely on and is
independent of the Agency's rationale for the proper scope of
certification. What triggers a requirement to apply for certification
is a distinct issue, independent from what the certifying authority can
consider in its subsequent certification decision. Second, this rule's
definition of water quality requirements remains valid regardless of
the scope of certification. The rule defines ``water quality
requirements'' to mean ``any limitation, standard, or other requirement
under sections 301, 302, 303, 306, and 307 of the Clean Water Act, any
Federal and state or Tribal laws or regulations implementing those
sections, and any other water quality-related requirement of state or
Tribal law.'' Section 121.1(j). The first two clauses (listing the
sections of the CWA identified in section 401 and the state or Tribal
laws implementing them) clearly hold true regardless of scope of
certification. In addition, regardless of the scope of certification
(i.e., either the full activity subject to the Federal license or
permit or only its point source discharges), in order to qualify as an
``appropriate'' requirement of state or Tribal law, the requirement
must be ``water quality-related.'' Additionally, the issue of which
waters to consider when acting on a request for certification is
independent of the issue of the proper scope of certification. Under
either a ``discharge-only'' or activity-based scope of certification,
the question remains whether certifying authorities may consider
impacts to state or Tribal waters beyond ``navigable waters.'' EPA's
interpretation regarding which waters may be considered is also
severable from all other aspects of this final rule. No provision of
this final rule operates differently depending on which waters a
certifying authority may consider when acting on a request for
certification.\115\ Further, the Agency's interpretation regarding
scope of the neighboring jurisdictions process in section 401(a)(2) is
independent and does not rely on the Agency's interpretation regarding
the scope of certification. As explained in this preamble, the
certification process and the neighboring jurisdictions process are two
distinct processes with distinct statutory text and legislative
history. EPA's interpretation of the scope of the neighboring
jurisdictions process expressly accounts for these differences.
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\115\ In fact, the Agency's interpretation of which waters may
be considered in certification is not reflected in the regulatory
text, including the text regarding scope of certification at Sec.
121.3.
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The other topics addressed in this rulemaking all function the same
regardless of the scope of certification. Many are important process
improvements (e.g., how to set the reasonable period of time, when
extensions are permissible, what are the elements of a request for
certification, when and how to modify a grant of certification) that
function the same regardless of scope. All the topics addressed in this
rulemaking beyond scope are important provisions that EPA would have
promulgated absent promulgation of a rule changing the scope of
certification. As explained throughout this preamble, these other
aspects of the rule provide independent benefits to the certification
process including regulatory certainty and transparency, efficient
certification reviews, and enhanced cooperative federalism. Regardless
of the scope of certification, for the reasons articulated in this
preamble, EPA would adopt the same pre-filing meeting requirement
(Sec. 121.4); the same minimum contents for a request for
certification (Sec. 121.5); the same process for determining the
reasonable period of time (Sec. 121.6); the same four ways a
certifying authority may act on a request (grant, grant with
conditions, deny, or expressly waive) (Sec. 121.7); the same
limitations regarding Federal agency review (Sec. 121.8); the same
standard for when inadvertent waiver occurs (Sec. 121.9); the same
procedure and limitations for modifying a grant of certification (Sec.
121.10); the same requirements for Indian Tribes to administer a
certification program (Sec. 121.11); the same procedures regarding the
neighboring jurisdictions process (Sec. Sec. 121.12 through 121.15);
the same additional procedures for when EPA acts as a certifying
authority (Sec. Sec. 121.16 and 121.17); the same rules regarding EPA
review and advice (Sec. 121.18), and would otherwise take the same
approach as it did in this final rule. EPA's rationales for adopting
these provisions apply equally regardless of the scope of certification
and these provisions would function equally under any scope of
certification.
Likewise, the other provisions of this rule operate independently
from each other and are intended to be severable. For example, the
contents of a request for certification (Sec. 121.5) function
independently from the procedures for setting and extending the
reasonable period of time (Sec. 121.6). The process and limitations
for modifying a grant of certification (Sec. 121.10) have no bearing
on a federally recognized Tribe's ability to apply for TAS for section
401 (Sec. 121.11). The limitations on Federal agency review (Sec.
121.8) have no bearing on when a request for certification is required
(Sec. 121.2). Were any element of these provisions stayed or
invalidated by a reviewing court, the elements that remained in effect
would continue to provide vital improvements to the certification
process including regulatory certainty and transparency, efficient
certification reviews, enhanced cooperative federalism, and where
appropriate, reasonable flexibility to adapt to changing circumstances.
The examples provided throughout this section are illustrative, rather
than exhaustive, and EPA intends each portion of the rule to be
independent and severable. Further, if the application of any portion
of this rule to a particular circumstance is determined to be invalid,
the Agency intends that the rule remain applicable to all other
circumstances.
V. Economic Analysis
Pursuant to Executive Orders 12866 (Regulatory Planning and Review)
and 14094 (Modernizing Regulatory Review), EPA has prepared an economic
analysis (Economic Analysis for the Final Rule) to inform the public of
potential effects associated with this rulemaking. This analysis is not
required by the CWA.
To support the final rulemaking, EPA prepared an Economic Analysis
for the Final Rule and other related rule analyses to assess potential
impacts of the rule. These analyses seek to evaluate the benefits and
costs of the rulemaking and the effects of the rule on vulnerable
groups and small entities. The Economic Analysis for the Final Rule
presents an overview of practice under the 1971 Rule and 2020 Rule
(baselines),\116\ a description of the final rule changes, and an
assessment of the potential impacts of the final rulemaking on project
proponents, certifying authorities, and Federal agencies as changes
from each baseline of regulatory practice to the new requirements.
Appendix A in the Economic Analysis for the Final Rule provides a
plain-language comparison of the 1971 Rule, 2020 Rule, and final
[[Page 66657]]
rulemaking provisions in a table format. Within the Economic Analysis
for the Final Rule, the Agency included discussion of the environmental
benefits and process costs with examples relative to the final
rulemaking provisions. EPA also assessed environmental justice impacts
of the rulemaking on vulnerable communities and impacts on small
entities. The Agency also prepared an Information Collection Request
Supporting Statement which describes the overall burden of the section
401 regulations, thus including any new burdens resulting from this
final rule. See section VI.B of this preamble.
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\116\ Due to ongoing litigation on the 2020 Rule, EPA considers
two baselines in the economic analysis.
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Section 401 certification decisions have varying effects on
certifying authorities and project proponents. However, the Agency has
limited data regarding the number of requests for certification
submitted and the certification decisions taken on requests for
certification (i.e., whether certifications were granted, granted with
conditions, denied, or waived). The Agency does not maintain a national
database of certifying authority decisions and therefore did not have
enough data available to perform a fully quantitative economic
analysis. Given the absence of data related to section 401 regulations,
EPA performed a qualitative analysis of the section 401 certification
process under the 1971 Rule, the 2020 Rule, and under the final
rulemaking.
The Agency reviewed information from several sources to
characterize section 401 baseline conditions and understand potential
impacts of the regulatory changes. Specifically, the Agency
investigated State and territory websites and assembled available
information concerning section 401 fees and certification decisions.
EPA also conducted a focused review of pre-proposal input letters \117\
and public comments \118\ to extract any information concerning
economic impacts of section 401 and key issues identified during
implementation of section 401.
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\117\ Docket ID No. EPA-HQ-OW-2021-0302.
\118\ Docket ID No. EPA-HQ-OW-2022-0128.
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Section 401 is a direct grant of authority to states and authorized
Tribes. Accordingly, EPA does not provide program oversight to state or
Tribal programs. Nevertheless, EPA reviewed state and territory
websites to investigate data availability on certification decisions
and found that seven certifying authorities have section 401
certification decision documents publicly available. The Agency
reviewed a random sample of 200 certification decisions from seven
different state websites \119\ and used a machine reading approach to
determine whether the Agency could derive any information on timing and
certification decisions to inform this rulemaking.\120\ Due to
significant data limitations, EPA was unable to use the review of the
certification decisions to make any conclusions to inform this
rulemaking. More information about the analysis that EPA performed when
reviewing these decision documents can be found in the Economic
Analysis for the Final Rule.
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\119\ Arkansas, California Water Board of San Diego, Idaho,
Mississippi, New Hampshire, Oregon, and Washington.
\120\ For more detailed information about the Agency's
methodology for selecting random samples and conducting the machine
reading analysis, please see Clean Water Act Section 401 Water
Quality Certification Improvement Rule--Final Rule, Memorandum to
the File, Certification Decision PDF Extraction Effort, available in
Docket ID No. EPA-HQ-OW-2022-0128.
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Within the Economic Analysis, the Agency describes the various
Federal licenses and permits that require section 401 certification and
the potential actions that certifying authorities may take pursuant to
their section 401 authority. Additionally, the Agency summarized the
annual number of licenses and permits that require section 401
certification under different Federal authorities to determine the
extent of licensing and permitting actions within the section 401
universe. These types of information are used in the Economic Analysis
for the Final Rule to describe implementation practices and trends
under the baselines and serve as the basis for assessing impacts of the
final rulemaking.
In determining the potential effects of the final rulemaking, EPA
described the impacts of rule revisions in several key areas including
pre-filing meetings, contents of requests for certification, reasonable
period of time, neighboring jurisdictions, and Tribal provisions for
implementing section 401. The 1971 Rule baseline did not include a pre-
filing meeting request requirement. However, because pre-filing
meetings allow for early discussion of project details, such meetings
would ultimately be expected to reduce burden elsewhere in the section
401 certification process. The 2020 Rule did not provide certifying
authorities with the option to waive or shorten the pre-filing meeting
request requirement. The Agency anticipates that the pre-filing meeting
request provision will provide flexibility for certifying authorities
to decide whether to require pre-filing meeting requests and whether to
hold pre-filing meetings based on project complexity and other factors.
Relative to both the 1971 Rule and 2020 Rule baselines, the Agency
expects that the minimum content requirements for all requests for
certifications will support a transparent and efficient certification
process. Additionally, relative to each of the two baselines, the
changes concerning the reasonable period of time for certification
review will balance equities between certifying authorities and Federal
agencies and provide flexibility for certifying authorities and Federal
agencies to determine the optimal length for the reasonable period of
time or any extensions, provided they do not exceed one year from the
date the request for certification was received. For example, the final
rule will allow certifying authorities to ensure that the reasonable
period of time is informed by the size and complexity of the project,
the certifying authority's available resources (e.g., staff size),
public notice and comment requirements, and other relevant timing
considerations (e.g., Federal license or permit deadlines; associated
National Environmental Policy Act deadlines; and/or anticipated
timeframe for neighboring jurisdictions process). Allowing the
certifying authority and Federal agency to negotiate a reasonable
period of time at or before the beginning of the certification process
(subject to a six-month default) is also likely to improve the
efficiency of the review process. The final rule also provides greater
clarity regarding the process to protect neighboring jurisdiction
waters (e.g., by specifying the contents of a notification from a
Federal agency to EPA), which is expected to increase its efficiency.
This clarity and efficiency are expected when using the 1971 Rule as
the baseline, as well as for the 2020 Rule baseline (though potentially
to a lesser extent due to some updated provisions in the 2020 Rule).
Neither the 1971 Rule nor the 2020 Rule included TAS provisions. Final
revisions permitting Tribes to obtain TAS solely for section 401 and,
if desired, to only obtain TAS for the purpose of participating as
neighboring jurisdictions under section 401(a)(2), will provide Tribes
with a greater ability to protect their water resources from the
adverse effects of pollution from federally licensed or permitted
projects.
In some areas, the rulemaking would revive practices that had been
widely implemented for 50 years before the 2020 Rule. Specifically, the
rule would return the scope of a certifying authority's section 401
review as encompassing the ``activity'' which is consistent with
longstanding Agency and certifying authority practice and
[[Page 66658]]
allows certifying authorities to protect their waters from the widest
range of impacts. The Agency is finalizing a certification modification
process, allowing certifying authorities and Federal agencies the
flexibility to mutually agree on circumstances warranting modification.
Provided that certification modification efforts are appropriately
coordinated, the modification process under the final rule would allow
certifying authorities to adapt to changes in environmental and
regulatory conditions, and provide needed flexibility to accommodate
changed circumstances after issuance of a grant of certification, with
or without conditions.
EPA anticipates that the rulemaking will enhance the ability of
states and Tribes to protect their water resources by clarifying key
components of the water quality certification process and improving
coordination between Federal agencies, certifying authorities, and
project proponents.
VI. Statutory and Executive Order Reviews
Additional information about these statutes and Executive orders
can be found at https://www.epa.gov/laws-regulations/laws-and-executive-orders.
A. Executive Order 12866: Regulatory Planning and Review and Executive
Order 14094: Modernizing Regulatory Review
This action is a ``significant regulatory action'' as defined in
Executive Order 12866, as amended by Executive Order 14094.
Accordingly, EPA submitted this action to the Office of Management and
Budget (OMB) for Executive Order 12866 review. Documentation of any
changes made in response to Executive Order 12866 review is available
in the docket for this action. The Agency prepared an economic analysis
of the potential impacts associated with this action, and concluded
that the benefits of the rule justify the costs. This analysis, the
Economic Analysis for the Final Rule, is available in the docket for
this action (Docket ID No. EPA-HQ-OW-2022-0128) and is briefly
summarized in section V in this preamble.
B. Paperwork Reduction Act (PRA)
The information collection activities in this rulemaking have been
submitted for approval to the Office of Management and Budget (OMB)
under the PRA. The Information Collection Request (ICR) document that
EPA prepared has been assigned EPA ICR number 2603.08 (OMB Control No.
2040-0295). You can find a copy of the ICR in the docket for this rule,
and it is briefly summarized here.
The information collected under section 401 is used by certifying
authorities and EPA to evaluate potential water quality impacts from
federally licensed or permitted projects. When states or Tribes with
TAS act as the certifying authority, the primary collection of this
information is performed by the Federal agencies issuing the licenses
or permits or the states and Tribes acting as certifying authorities.
When EPA acts as the certifying authority or evaluates potential
neighboring jurisdiction impacts, the information is collected by EPA.
Information collected directly by EPA under section 401 in support of
the section 402 NPDES program is already captured under existing ICR
No. 0229.255 (OMB Control No. 2040-0004). The information collected
under section 518(e) is used by EPA to determine whether a Tribe is
eligible for TAS for section 401 or TAS for section 401(a)(2).
Information collected directly by EPA under section 518(e) in support
of the process for Tribes to obtain TAS for CWA section 303(c) and
section 401 simultaneously is already captured under existing ICR No.
0988.14 (OMB Control No. 2040-0049). The information collection
requirements are not enforceable until OMB approves them.
The revisions clarify the nature of the information project
proponents must include in a request for section 401 certification.
They also contain a pre-filing meeting request requirement for project
proponents which may be waived or shortened by a certifying authority.
The revisions also provide Tribes with the ability to obtain TAS solely
for either section 401 or section 401(a)(2). Total annual burden for
respondents (project proponents and certifying authorities and Tribes
applying for TAS) are anticipated to be 861,274 hours with the
associated annual labor costs being approximately $48 million. EPA
expects these revisions to provide greater clarity regarding section
401 requirements, to reduce the overall preparation time spent by a
project proponent on requests for certification, and to reduce the
review time for certifying authorities.
In the interest of transparency, EPA is providing the following
summary of the relevant portions of the burden assessment associated
with EPA's existing certification regulations. EPA does not expect any
measurable change in information collection burden associated with the
rulemaking changes.
Respondents/affected entities: Project proponents, state and Tribal
reviewers (certifying authorities), Tribes applying for TAS.
Respondent's obligation to respond: Required to obtain section 401
water quality certification; voluntary for Tribes to apply for TAS.
Estimated number of respondents: 154,006 responses from 77,146
respondents annually.
Frequency of response: Variable (one per Federal license or permit
application, or only once) depending on type of information collected.
Total estimated burden: 861,274 hours (per year). Burden is defined
at 5 CFR 1320.3(b).
Total estimated cost: $48 million (per year).
An agency may not conduct or sponsor, and a person is not required
to respond to, a collection of information unless it displays a
currently valid OMB control number. The OMB control numbers for EPA's
regulations in 40 CFR are listed in 40 CFR part 9. When OMB approves
this ICR, the Agency will announce that approval in the Federal
Register and publish a technical amendment to 40 CFR part 9 to display
the OMB control number for the approved information collection
activities contained in this final rule.
C. Regulatory Flexibility Act (RFA)
I certify that this final rule will not have a significant economic
impact on a substantial number of small entities under the RFA. The
small entities subject to the requirements of this action are project
proponents that are small businesses applying for Federal licenses or
permits subject to section 401 certification, which includes
construction, manufacturing, mining, and utility businesses. Section
401 requires project proponents to obtain a water quality certification
from the certifying authority where the potential discharge originates
or will originate before it may obtain such Federal license or permit.
EPA is not able to quantify the impacts of the rulemaking on small
entities due to several data limitations and uncertainties, which are
described within the Economic Analysis for the Final Rule, available in
the docket for this rulemaking. However, EPA is including a qualitative
assessment of the potential impacts of the rulemaking on project
proponents that are small entities in the Economic Analysis for the
Final Rule. Based on the qualitative analysis, the Agency has
determined that some small entities may experience some impact from the
rulemaking but that the impact would not be significant, nor would the
number of small entities be substantial. See the Economic
[[Page 66659]]
Analysis for the Final Rule for details of the qualitative analysis.
D. Unfunded Mandates Reform Act (UMRA)
This action does not contain an unfunded mandate of $100 million or
more as described in UMRA, 2 U.S.C. 1531-1538, and does not
significantly or uniquely affect small governments. While this action
creates enforceable duties for the private sector, the cost does not
exceed $100 million or more. This action does not create enforceable
duties for state and Tribal governments. See the Economic Analysis for
the Final Rule in the docket for further discussion on UMRA.
E. Executive Order 13132: Federalism
Under the technical requirements of Executive Order 13132 (64 FR
43255, August 10, 1999), EPA has determined that this rulemaking does
not have federalism implications but expects that this rulemaking may
be of significant interest to state and local governments. Consistent
with EPA's policy to promote communication between EPA and state and
local governments, EPA conducted outreach and engagement with state and
local government officials and representatives prior to the
finalization of this rule to permit them to have meaningful and timely
input into its development.
EPA is finalizing updates to its CWA section 401 regulation to
provide greater clarity and flexibility for certifying authorities in
relation to acting on pre-filing meeting requests, contents of requests
for certification, acting within the reasonable period of time,
modifying a grant of certification, and participating in the
neighboring jurisdictions process. EPA is also finalizing
clarifications to the scope of Federal agency review; however, nothing
in EPA's rulemaking would preempt state law. These regulatory
clarifications and revisions will reinforce the authority granted to
states by CWA section 401 to protect their water quality, which had
been exercised by the states prior to implementation of the 2020 Rule.
Prior to proposing a rule in June 2022, EPA solicited
recommendations and conducted pre-proposal outreach, such as virtual
listening sessions, where many state and local governments,
intergovernmental associations, and other associations representing
state and local governments participated. Specifically, EPA hosted
webinar-based listening sessions for pre-proposal input on June 14,
June 15, June 23, and June 24, 2021, with over 400 participants from
most states and a few territories. Furthermore, EPA accommodated
requests for listening sessions with representatives from the
Association of Clean Water Administrators, the Association of State
Wetland Managers, the Environmental Council of the States, Western
States Water Council, Indiana Department of Environmental Management,
Maryland Department of the Environment, New Mexico Environmental
Department, New York Department of Environmental Conservation, Oregon
Department of Environmental Quality, Virginia Department of
Environmental Quality, and Washington Department of Ecology. All pre-
proposal input letters and summaries of the webinar-based listening
sessions are available in Docket ID No. EPA-HQ-OW-2021-0302. These
webinars, meetings, and input letters provided a wide and diverse range
of interests, positions, and recommendations to the Agency.
After publishing the proposed rule in the Federal Register,
stakeholders were encouraged to submit comment letters during a 60-day
public comment period, and EPA held a public hearing on July 18, 2022
for all stakeholders to provide public comment on the proposed rule.
Additionally, EPA hosted three listening sessions specifically for
state and territory government representatives on June 15, 22, and 28,
2022--there were over 175 attendees at these listening sessions.
Summaries of the public hearing sessions and of the input received
during the state/territory listening sessions can be found in the
docket for this rulemaking. Furthermore, EPA reviewed and responded to
the public comment letters from state, territory, and local governments
in a Response to Comments document that can also be found in the docket
for this rulemaking.
Comments on the proposed rule were submitted by various state and
territory governmental agencies, predominately state environmental
agencies or departments, with some comments from state departments of
agriculture, wildlife (and fish and game), public health, and
transportation. In addition, some comments were submitted by governors'
offices and attorneys general, with a few joint comments from multiple
state attorneys general. A few comments were submitted by state-
specific, state-level water boards or departments. Comments were also
submitted by several national and regional state associations. Many of
these commenters were generally supportive of the rulemaking effort and
elements of the proposed rule, but also offered suggestions and/or
critiques of specific aspects of the proposed rule. Commenters in
support of the proposed rule generally critiqued the 2020 Rule or
offered support for the 1971 Rule approach to section 401. These
commenters argued that the proposed rule was an improvement over the
2020 Rule in terms of cooperative federalism and/or the purported
approach to the CWA and discussed the importance of state involvement
under the CWA and section 401, with several commenters discussing
specific approaches in their states. On the other hand, other state
commenters, including a large group of state attorneys general that
signed onto one letter, voiced support for the 2020 Rule, arguing that
the narrowed scope of certification review introduced in the 2020 Rule
was necessary to prevent the abuse or misuse of CWA section 401 by
certifying authorities.
As discussed throughout this preamble, EPA acknowledges that the
final rule may change how states and territories administer the section
401 program, but anticipates that the adjustments incorporated into the
final rule will provide states and territories with additional
flexibility (1) in waiving or shortening the pre-filing meeting request
requirement, (2) in defining additional content requirements for
requests for certification, (3) in negotiating the length of the
reasonable period of time (including development of categorical
agreements), (4) in reviewing the water quality-related impacts from
the activity, (5) in development of their certification decision
documents, (6) in the ability to modify a grant of certification, and
(7) in the neighboring jurisdictions process if a potential discharge
originating in another jurisdiction may affect their water quality.
Finally, the final rule provides clarity for states acting as
certifying authorities on several key aspects of the certification
process, including (1) the minimum contents of a request for
certification, (2) the start of the reasonable period of time (and the
default length of the reasonable period of time), (3) the water
quality-related scope of review, (4) the recommended contents of
certification decisions, (5) the extent of Federal agency review, (6)
the limits to modifications of certifications, and (7) the neighboring
jurisdictions process.
As mentioned above, all state and local government comment letters
and recommendations received during the comment period are included in
the rulemaking docket (Docket ID No. EPA-HQ-OW-2022-0128).
[[Page 66660]]
F. Executive Order 13175: Consultation and Coordination With Indian
Tribal Governments
This action may have implications for Tribal governments. However,
it will neither impose substantial direct compliance costs on federally
recognized Tribal governments, nor preempt Tribal law. This action may
change how Tribes with TAS for section 401 administer the section 401
program, but it will not have an administrative impact on Tribes on
whose behalf EPA issues certifications. As discussed in the preamble,
EPA expects this final rule to expand and further clarify the
opportunities for Tribal participation in the CWA section 401 water
quality certification process.
EPA consulted with Tribal officials under the EPA Policy on
Consultation and Coordination with Indian Tribes early in the process
of developing this rulemaking to allow them to have meaningful and
timely input into its development. EPA has developed a final ``Summary
Report of Tribal Consultation and Engagement for the Clean Water Act
Section 401 Water Quality Certification Improvement Rule'' which
further describes EPA's efforts to engage with Tribal representatives
and is available in the docket for this rulemaking.
As required by section 7(a), EPA's Tribal Consultation Official has
certified that the requirements of the executive order have been met in
a meaningful and timely manner. A copy of the certification is included
in the docket for this action.
As previously mentioned, the Agency initiated a Tribal consultation
and coordination process before proposing a rule by sending a
``Notification of Consultation and Coordination'' letter, dated June 7,
2021, to all 574 of the Tribes federally recognized at that time (see
Docket ID No. EPA-HQ-OW-2021-0302). The letter invited Tribal leaders
and designated consultation representatives to participate in the
Tribal consultation and coordination process for this rulemaking. In
addition to two national Tribal webinars held on June 29 and July 7,
2021, the Agency convened other listening sessions, that Tribal members
and representatives attended, for certifying authorities and the
public. EPA continued outreach and engagement with Tribes and sought
other opportunities to provide information and hear feedback from
Tribes at national and regional Tribal meetings during and after the
end of the consultation period. The Agency did not receive any
consultation requests. All Tribal and Tribal organization letters and
webinar feedback are included in the pre-proposal docket (Docket ID No.
EPA-HQ-OW-2021-0302), and a summary of the Tribal consultation and
coordination effort may be found in the docket for this action (Docket
ID No. EPA-HQ-OW-2022-0128). Many Tribal feedback letters or meeting
participants expressed an interest in receiving additional information
and in continued engagement with the Agency during development of the
proposed rulemaking; however, most of these Tribal representatives
highlighted other ongoing rulemakings that also required their
engagement.
After publishing the proposed rule in the Federal Register,
stakeholders were encouraged to submit comment letters during a 60-day
public comment period, and EPA held a public hearing on July 18, 2022
for all stakeholders to provide public comment on the proposed rule.
Additionally, EPA hosted three listening sessions specifically for
Tribal representatives on June 15, 22, and 28, 2022--there were over 75
attendees at these listening sessions. Summaries of the public hearing
sessions and of the input received during the Tribal listening sessions
can be found in the docket for this rulemaking. Furthermore, EPA
reviewed and responded to the public comment letters from Tribal
representatives in a Response to Comments document that can also be
found in the docket for this rulemaking.
Most Tribal commenters expressed support for the proposed rule's
return to pre-2020 rule practices to restore Tribal sovereignty for the
protection of their water resources. Many Tribal commenters supported
inclusion of a section 401 TAS process independent of TAS for section
303(c), asserting that it would increase Tribal authority related to
the neighboring jurisdictions process and increase Tribal regulatory
capability as certifying authorities. Many Tribal commenters supported
EPA's return to the Agency's longstanding ``activity as a whole'' scope
of review. Many Tribal commenters also expressed support for the
proposed rule's approach to extensions to the reasonable period of
time, as well as the proposed removal of the regulatory prohibition on
withdrawal and resubmission of requests for certification. Some Tribal
commenters supported increased flexibility for modifications.
While many of the Tribal commenters supported the proposed rule,
some Tribal commenters expressed disagreement or concern with portions
of the proposed rule. A few Tribal commenters said that they were
concerned with the inability to participate in the neighboring
jurisdictions process if EPA does not commit in the regulation to
consulting with Tribes during EPA's 30-day review period. Another issue
some Tribal commenters raised was the need for more clarity regarding
Tribal enforcement of section 401 certification conditions.
Additionally, a few Tribal commenters expressed concern that the
default 60-day reasonable period of time would not be enough time for
their review of large, complex projects. As mentioned throughout this
preamble, the Agency expects the adjustments made from the proposed
rule to the final rule to address any Tribal representative concerns
while continuing to provide the flexibility and clarity that many
Tribal representatives requested. For more information about the Tribal
consultation and coordination efforts, please see the final ``Summary
Report of Tribal Consultation and Engagement for the Clean Water Act
Section 401 Water Quality Certification Improvement Rule'' in the
docket (Docket ID No. EPA-HQ-OW-2022-0128).
G. Executive Order 13045: Protection of Children From Environmental
Health and Safety Risks
EPA interprets Executive Order 13045 as applying only to those
regulatory actions that concern environmental health or safety risks
that EPA has reason to believe may disproportionately affect children,
per the definition of ``covered regulatory action'' in section 2-202 of
the Executive order.
Therefore, this action is not subject to Executive Order 13045
because it does not concern an environmental health risk or safety
risk. Since this action does not concern human health, EPA's Policy on
Children's Health also does not apply.
H. Executive Order 13211: Actions Concerning Regulations That
Significantly Affect Energy Supply, Distribution, or Use
This action is not a ``significant energy action'' because it is
not likely to have a significant adverse effect on the supply,
distribution, or use of energy. See the Economic Analysis for the Final
Rule in the docket for further discussion on Executive Order 13211.
I. National Technology Transfer and Advancement Act
This final rulemaking does not involve technical standards.
[[Page 66661]]
J. Executive Order 12898: Federal Actions To Address Environmental
Justice in Minority Populations and Low-Income Populations and
Executive Order 14096: Revitalizing Our Nation's Commitment to
Environmental Justice for All
EPA believes that it is not practicable to assess whether the human
health or environmental conditions that exist prior to this action
result in disproportionate and adverse effects on communities with
environmental justice concerns. The Economic Analysis for the Final
Rule includes information about the data limitations and uncertainties
that exist regarding both baseline environmental conditions and how
stakeholders, including certifying authorities, may respond to this
final rule.
The Agency recognizes that the burdens of environmental pollution
disproportionately fall on certain communities with environmental
justice concerns, and EPA is responsive to environmental justice
concerns through multiple provisions in this rule.
One of the ways the Agency addresses environmental justice concerns
through the final rule is through the pre-filing meeting request
requirement, which provides a mechanism to ensure certifying
authorities can request and receive information needed to protect their
water resources and ensure the activity will comply with applicable
water quality requirements, including through consideration of
information and input from potentially affected communities with
environmental justice concerns during early engagement. In addition to
informing the certification process, this also advances the goals of
Executive Order 14096, including ``meaningful involvement.''
Additionally, the final rule empowers certifying authorities to
make a well-informed decision that may affect communities with
environmental justice concerns because under the final rule, the
certifying authority can determine the additional contents of requests
for certification (as long as those contents are relevant to the water
quality-related impacts from the activity and are identified prior to
when a project proponent submits a request). Starting the certifying
authority's review of a request for certification with the necessary
information about water quality-related impacts from the activity
promotes environmental justice and transparency in the certification
process. This also enables certifying authorities to share a greater
level of detail with the public (including any communities that may be
impacted by a proposed project), so that participants in the public
notice and comment process can provide better informed input.\121\
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\121\ Under CWA section 401(a)(1), certifying authorities are
required to establish procedures for public notice and, to the
extent it deems appropriate, procedures for public hearings. 33
U.S.C. 1341(a)(1).
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Under the final rule's collaborative approach for determining the
reasonable period of time, certifying authorities can take the needs of
potentially affected communities into account when determining the
amount of time they need to review and evaluate the potential impacts
of a proposed project on the communities' water resources (e.g., a
certifying authority may suggest a longer reasonable period of time to
facilitate outreach to communities or to conduct studies on a proposed
project's impact on local communities). Additionally, the ``activity''
approach for scope of review has the potential to benefit communities
with environmental justice concerns by ensuring that the certifying
authority can broadly review the potential water quality impacts on
affected communities.
Furthermore, the TAS provisions for section 401 as a whole or only
for section 401(a)(2) give Tribes additional options to obtain TAS, as
well as more opportunities to provide input and voice any water quality
concerns during the section 401 process. Lastly, when EPA is acting as
the certifying authority, the Agency is finalizing the proposed updates
to the public notice provision to facilitate participation by the
broadest number of potentially interested stakeholders, including
communities with environmental justice concerns.
The information supporting this Executive order review, including a
description of data limitations and uncertainties, is contained in the
Economic Analysis for the Final Rule, which can be found in the docket
for this action and is briefly summarized in section V in this
preamble.
K. Congressional Review Act (CRA)
This action is subject to the CRA, and EPA will submit a rule
report to each House of Congress and to the Comptroller General of the
United States. This action is not a ``major rule'' as defined by 5
U.S.C. 804(2).
List of Subjects
40 CFR Part 121
Environmental protection, Administrative practice and procedure,
Intergovernmental relations, Water pollution control.
40 CFR Part 122
Environmental protection, Administrative practice and procedure,
Confidential business information, Hazardous substances, Reporting and
recordkeeping requirements, Water pollution control.
40 CFR Part 124
Environmental protection, Administrative practice and procedure,
Air pollution control, Hazardous waste, Indians--lands, Reporting and
recordkeeping requirements, Water pollution control, Water supply.
Michael S. Regan,
Administrator.
For the reasons set forth in the preamble, EPA amends 40 CFR parts
121, 122, and 124 as follows:
0
1. Revise part 121 to read as follows:
PART 121--STATE CERTIFICATION OF ACTIVITIES REQUIRING A FEDERAL
LICENSE OR PERMIT
Sec.
Subpart A--General
121.1 Definitions.
121.2 When certification is required.
121.3 Scope of certification.
121.4 Pre-filing meeting requests.
121.5 Request for certification.
121.6 Reasonable period of time.
121.7 Certification decisions.
121.8 Extent of Federal agency review.
121.9 Failure or refusal to act.
121.10 Modification to a grant of certification.
121.11 Requirements for Indian Tribes to administer a water quality
certification program.
Subpart B--Neighboring Jurisdictions
121.12 Notification to the Regional Administrator.
121.13 Determination of effects on neighboring jurisdictions.
121.14 Objection from notified neighboring jurisdiction and request
for a public hearing.
121.15 Public hearing and Federal agency evaluation of objection.
Subpart C--Certification by the Administrator
121.16 When the Administrator certifies.
121.17 Public notice and hearing.
Subpart D--Review and Advice
121.18 Review and advice.
Subpart E--Severability
121.19 Severability
Authority: 33 U.S.C. 1251 et seq.
Subpart A--General
Sec. 121.1 Definitions.
As used in this part, the following terms shall have the meanings
indicated:
[[Page 66662]]
(a) Administrator means the Administrator, Environmental Protection
Agency (EPA).
(b) Certifying authority means the entity responsible for
certifying compliance with applicable water quality requirements in
accordance with Clean Water Act section 401.
(c) Federal agency means any agency of the Federal Government to
which application is made for a Federal license or permit that is
subject to Clean Water Act section 401.
(d) Federal Indian Reservation, Indian reservation, or reservation
means all land within the limits of any Indian reservation under the
jurisdiction of the United States Government, notwithstanding the
issuance of any patent, and including rights-of-way running through the
reservation.
(e) Indian Tribe or Tribe means any Indian Tribe, band, group, or
community recognized by the Secretary of the Interior and exercising
governmental authority over a Federal Indian Reservation.
(f) License or permit means any license or permit issued or granted
by an agency of the Federal Government to conduct any activity which
may result in any discharge into waters of the United States.
(g) Neighboring jurisdiction means any state, or Tribe with
treatment in a similar manner as a state for Clean Water Act section
401 in its entirety or only for Clean Water Act section 401(a)(2),
other than the jurisdiction in which the discharge originates or will
originate.
(h) Project proponent means the applicant for a Federal license or
permit, or the entity seeking certification.
(i) Regional Administrator means the Regional designee appointed by
the Administrator, Environmental Protection Agency.
(j) Water quality requirements means any limitation, standard, or
other requirement under sections 301, 302, 303, 306, and 307 of the
Clean Water Act, any Federal and state or Tribal laws or regulations
implementing those sections, and any other water quality-related
requirement of state or Tribal law.
Sec. 121.2 When certification is required.
Certification or waiver is required for any Federal license or
permit that authorizes any activity which may result in any discharge
from a point source into waters of the United States.
Sec. 121.3 Scope of certification.
(a) When a certifying authority reviews a request for
certification, the certifying authority shall evaluate whether the
activity will comply with applicable water quality requirements. The
certifying authority's evaluation is limited to the water quality-
related impacts from the activity subject to the Federal license or
permit, including the activity's construction and operation.
(b) Consistent with the scope of review identified in paragraph (a)
of this section, a certifying authority shall include any conditions in
a grant of certification necessary to assure that the activity will
comply with applicable water quality requirements.
Sec. 121.4 Pre-filing meeting requests.
The project proponent shall request a pre-filing meeting with the
certifying authority at least 30 days prior to submitting a request for
certification in accordance with the certifying authority's applicable
submission procedures, unless the certifying authority waives or
shortens the requirement for a pre-filing meeting request.
Sec. 121.5 Request for certification.
(a) Where a project proponent is seeking certification from any
certifying authority, the request for certification shall include the
following minimum contents:
(1) If the request for certification is for an individual Federal
license or permit, it shall be in writing, signed, and dated and shall
include the following:
(i) A copy of the Federal license or permit application submitted
to the Federal agency; and
(ii) Any readily available water quality-related materials that
informed the development of the application.
(2) If the request for certification is for the issuance of a
general Federal license or permit, it shall be in writing, signed, and
dated and shall include the following:
(i) A copy of the draft Federal license or permit; and
(ii) Any readily available water quality-related materials that
informed the development of the draft Federal license or permit.
(b) Where a project proponent is seeking certification from the
Regional Administrator, if not already included in the request for
certification in accordance with paragraph (a) of this section, a
request for certification shall also include the following, as
applicable:
(1) A description of the proposed activity, including the purpose
of the proposed activity and the type(s) of discharge(s) that may
result from the proposed activity;
(2) The specific location of any discharge(s) that may result from
the proposed activity;
(3) A map or diagram of the proposed activity site, including the
proposed activity boundaries in relation to local streets, roads, and
highways;
(4) A description of current activity site conditions, including
but not limited to relevant site data, photographs that represent
current site conditions, or other relevant documentation;
(5) The date(s) on which the proposed activity is planned to begin
and end and, if known, the approximate date(s) when any discharge(s)
may commence;
(6) A list of all other Federal, interstate, Tribal, state,
territorial, or local agency authorizations required for the proposed
activity and the current status of each authorization; and
(7) Documentation that a pre-filing meeting request was submitted
to the certifying authority in accordance with applicable submission
procedures, unless the pre-filing meeting request requirement was
waived.
(c) Where a project proponent is seeking certification from a
certifying authority other than the Regional Administrator, and that
certifying authority has identified contents of a request for
certification in addition to those identified in paragraph (a) of this
section that are relevant to the water quality-related impacts from the
activity, the project proponent shall include in the request for
certification those additional contents identified prior to when the
request for certification is made.
(d) Where a project proponent is seeking certification from a
certifying authority other than the Regional Administrator, and that
certifying authority has not identified contents of a request for
certification in addition to those identified in paragraph (a) of this
section that are relevant to the water quality-related impacts from the
activity, the project proponent shall include in the request for
certification those additional contents identified in paragraph (b) of
this section.
Sec. 121.6 Reasonable period of time.
(a) The reasonable period of time begins on the date that the
certifying authority receives a request for certification, as defined
in Sec. 121.5, in accordance with the certifying authority's
applicable submission procedures. The certifying authority shall send
written confirmation to the project proponent and Federal agency of the
date that the request for certification was received.
[[Page 66663]]
(b) The Federal agency and the certifying authority may jointly
agree in writing to the reasonable period of time for the certifying
authority to act on the request for certification, provided the
reasonable period of time does not exceed one year from the date that
the request for certification was received. Such written agreements may
establish categorical reasonable periods of time.
(c) If the Federal agency and the certifying authority do not agree
in writing on the length of the reasonable period of time, the
reasonable period of time shall be six months.
(d) If a longer period of time is necessary to accommodate the
certifying authority's public notice procedures or force majeure events
(including, but not limited to, government closure or natural
disasters), upon written notification by the certifying authority to
the Federal agency prior to the end of the reasonable period of time,
the reasonable period of time shall be extended by the period of time
necessitated by public notice procedures or the force majeure event. In
such written notification to the Federal agency, the certifying
authority shall identify how much additional time is required and
provide a justification for such extension. Such an extension shall not
cause the reasonable period of time to exceed one year from the date
that the request for certification was received.
(e) The Federal agency and certifying authority may agree in
writing to extend the reasonable period of time for any reason,
provided that the extension shall not cause the reasonable period of
time to exceed one year from the date that the request for
certification was received.
Sec. 121.7 Certification decisions.
(a) A certifying authority may act on a request for certification
in one of four ways: grant certification, grant certification with
conditions, deny certification, or expressly waive certification.
(b) A certifying authority shall act on a request for certification
within the scope of certification and within the reasonable period of
time.
(c) A grant of certification shall be in writing and should include
the following:
(1) Identification of the decision as a grant of certification;
(2) Identification of the applicable Federal license or permit;
(3) A statement that the activity will comply with water quality
requirements; and
(4) An indication that the certifying authority complied with its
public notice procedures established pursuant to Clean Water Act
section 401(a)(1).
(d) A grant of certification with conditions shall be in writing
and should include the following:
(1) Identification of the decision as a grant of certification with
conditions;
(2) Identification of the applicable Federal license or permit;
(3) A statement explaining why each of the included conditions is
necessary to assure that the activity will comply with water quality
requirements; and
(4) An indication that the certifying authority complied with its
public notice procedures established pursuant to Clean Water Act
section 401(a)(1).
(e) A denial of certification shall be in writing and should
include the following:
(1) Identification of the decision as a denial of certification;
(2) Identification of the applicable Federal license or permit;
(3) A statement explaining why the certifying authority cannot
certify that the activity will comply with water quality requirements,
including but not limited to a description of any missing water
quality-related information if the denial is based on insufficient
information; and
(4) An indication that the certifying authority complied with its
public notice procedures established pursuant to Clean Water Act
section 401(a)(1).
(f) An express waiver shall be in writing and should include the
following:
(1) Identification of the decision as an express waiver of
certification;
(2) Identification of the applicable Federal license or permit;
(3) A statement that the certifying authority expressly waives its
authority to act on the request for certification; and
(4) An indication that the certifying authority complied with its
public notice procedures established pursuant to Clean Water Act
section 401(a)(1).
(g) If the certifying authority determines that no water quality
requirements are applicable to the activity, the certifying authority
shall grant certification.
Sec. 121.8 Extent of Federal agency review.
To the extent a Federal agency verifies compliance with the
requirements of Clean Water Act section 401, its review is limited to
whether: the appropriate certifying authority issued the certification
decision; the certifying authority confirmed it complied with its
public notice procedures established pursuant to Clean Water Act
section 401(a)(1); and the certifying authority acted on the request
for certification within the reasonable period of time.
Sec. 121.9 Failure or refusal to act.
(a) The certification requirement shall be waived only if a
certifying authority fails or refuses to act on a request for
certification within the reasonable period of time.
(b) If the Federal agency determines that the certifying authority
did not act on a request for certification within the reasonable period
of time, the Federal agency shall promptly notify the certifying
authority and project proponent in writing that the certification
requirement has been waived in accordance with Sec. 121.8. Such notice
shall satisfy the project proponent's requirement to obtain
certification.
Sec. 121.10 Modification to a grant of certification.
(a) Provided that the Federal agency and the certifying authority
agree in writing that the certifying authority may modify a grant of
certification (with or without conditions), the certifying authority
may modify only the agreed-upon portions of the certification. The
certifying authority is not required to obtain the Federal agency's
agreement on the language of the modification.
(b) The certifying authority shall not, through a modification
pursuant to paragraph (a) of this section:
(1) Revoke a grant of certification (with or without conditions);
or
(2) Change a grant of certification (with or without conditions)
into a denial or waiver of certification.
Sec. 121.11 Requirements for Indian Tribes to administer a water
quality certification program.
(a) The Regional Administrator may accept and approve a Tribal
application for purposes of administering a water quality certification
program if the Tribe meets the following criteria:
(1) The Indian Tribe is recognized by the Secretary of the Interior
and meets the definitions in Sec. 121.1(d) and (e);
(2) The Indian Tribe has a governing body carrying out substantial
governmental duties and powers;
(3) The water quality certification program to be administered by
the Indian Tribe pertains to the management and protection of water
resources that are within the borders of the Indian reservation and
held by the Indian Tribe, within the borders of the Indian reservation
and held by the United States in trust for Indians, within the borders
of the Indian reservation and held by a member of the Indian Tribe if
such property interest is subject to a trust restriction on alienation,
or otherwise within the borders of the Indian reservation; and
[[Page 66664]]
(4) The Indian Tribe is reasonably expected to be capable, in the
Regional Administrator's judgment, of carrying out the functions of an
effective water quality certification program in a manner consistent
with the terms and purposes of the Clean Water Act and applicable
regulations in this chapter.
(b) Requests by an Indian Tribe for administration of a water
quality certification program should be submitted to the appropriate
EPA Regional Administrator. The application shall include the following
information, provided that where the Tribe has previously qualified for
eligibility or ``treatment as a state'' under another EPA-administered
program, the Tribe need only provide the required information that has
not been submitted in a previous application:
(1) A statement that the Tribe is recognized by the Secretary of
the Interior.
(2) A descriptive statement demonstrating that the Tribal governing
body is currently carrying out substantial governmental duties and
powers over a defined area. The statement should:
(i) Describe the form of Tribal government;
(ii) Describe the types of governmental functions currently
performed by the Tribal governing body such as, but not limited to, the
exercise of police powers affecting (or relating to) the health,
safety, and welfare of the affected population, taxation, and the
exercise of the power of eminent domain; and
(iii) Identify the source of the Tribal government's authority to
carry out the governmental functions currently being performed.
(3) A descriptive statement of the Tribe's authority to regulate
water quality. The statement should include:
(i) A map or legal description of the area over which the Tribe
asserts authority to regulate surface water quality; and
(ii) A statement by the Tribe's legal counsel or equivalent
official that describes the basis for the Tribe's assertion of
authority and may include copies of documents such as Tribal
constitutions, by-laws, charters, executive orders, codes, ordinances,
and/or resolutions that support the Tribe's assertion of authority.
(4) A narrative statement describing the capability of the Indian
Tribe to administer an effective water quality certification program.
The narrative statement should include:
(i) A description of the Indian Tribe's previous management
experience that may include the administration of programs and services
authorized by the Indian Self-Determination and Education Assistance
Act (25 U.S.C. 450, et seq.), the Indian Mineral Development Act (25
U.S.C. 2101, et seq.), or the Indian Sanitation Facility Construction
Activity Act (42 U.S.C. 2004a);
(ii) A list of existing environmental or public health programs
administered by the Tribal governing body and copies of related Tribal
laws, policies, and regulations;
(iii) A description of the entity (or entities) which exercise the
executive, legislative, and judicial functions of the Tribal
government;
(iv) A description of the existing, or proposed, agency of the
Indian Tribe which will assume primary responsibility for establishing
and implementing a water quality certification program; and
(v) A description of the technical and administrative capabilities
of the staff to administer and manage an effective water quality
certification program or a plan which proposes how the Tribe will
acquire additional administrative and technical expertise. The plan
must address how the Tribe will obtain the funds to acquire the
administrative and technical expertise.
(5) Additional documentation required by the Regional Administrator
which, in the judgment of the Regional Administrator, is necessary to
support a Tribal application.
(c) The procedure for processing a Tribe's application is as
follows:
(1) The Regional Administrator shall process an application of an
Indian Tribe submitted pursuant to paragraph (b) of this section in a
timely manner. The Regional Administrator shall promptly notify the
Indian Tribe of receipt of the application.
(2) Except as provided in paragraph (c)(4) of this section, within
30 days after receipt of the Tribe's application, the Regional
Administrator shall provide appropriate notice. The notice shall:
(i) Include information on the substance and basis of the Tribe's
assertion of authority to regulate the quality of reservation waters;
(ii) Be provided to all appropriate governmental entities; and
(iii) Provide 30 days for comments to be submitted on the Tribal
application. Comments shall be limited to the Tribe's assertion of
authority.
(3) If a Tribe's asserted authority is subject to a competing or
conflicting claim, the Regional Administrator, after due consideration,
and in consideration of other comments received, shall determine
whether the Tribe has adequately demonstrated that it meets the
requirements of paragraph (a)(3) of this section.
(4) Where, after November 27, 2023, EPA has determined that a Tribe
qualifies for treatment in a similar manner as a state for the Clean
Water Act section 303(c) Water Quality Standards Program, Clean Water
Act section 303(d) Impaired Water Listing and Total Maximum Daily Loads
Program, Clean Water Act section 402 National Pollutant Discharge
Elimination System Program, or Clean Water Act section 404 Dredge and
Fill Permit Program, and has provided notice and an opportunity to
comment on the Tribe's assertion of authority to appropriate
governmental entities as part of its review of the Tribe's prior
application, no further notice to governmental entities, as described
in paragraph (c)(2) of this section, shall be provided with regard to
the same Tribe's application for the water quality certification
program, unless the application presents to the EPA Regional
Administrator different jurisdictional issues or significant new
factual or legal information relevant to jurisdiction.
(5) Where the Regional Administrator determines that a Tribe meets
the requirements of this section, they shall promptly provide written
notification to the Indian Tribe that the Tribe is authorized to
administer the water quality certification program.
(d) An Indian Tribe may submit a Tribal application for purposes of
administering only the Clean Water Act section 401(a)(2) portion of a
water quality certification program.
Subpart B--Neighboring Jurisdictions
Sec. 121.12 Notification to the Regional Administrator.
(a) Within five days of the date that it has received both the
application and either a certification or waiver for a Federal license
or permit, the Federal agency shall provide written notification to the
appropriate Regional Administrator.
(1) The notification shall include a copy of the certification or
waiver and the application for the Federal license or permit.
(2) The notification shall also contain a general description of
the proposed project, including but not limited to the Federal license
or permit identifier, project location (e.g., latitude and longitude),
a project summary including the nature of any discharge and size or
scope of activity, and whether the Federal agency is aware of any
neighboring jurisdiction providing
[[Page 66665]]
comment about the project. If the Federal agency is aware that a
neighboring jurisdiction provided comment about the project, it shall
include a copy of those comments in the notification.
(b) If the Regional Administrator determines there is a need for
supplemental information to make a determination about potential
neighboring jurisdiction effects pursuant to Clean Water Act section
401(a)(2), the Regional Administrator may make a written request to the
Federal agency that such information be provided in a timely manner for
EPA's determination, and the Federal agency shall obtain that
information from the project proponent and forward the additional
information to the Administrator within such timeframe.
(c) The Regional Administrator may enter into an agreement with a
Federal agency regarding the manner of this notification process and
the provision of supplemental information.
Sec. 121.13 Determination of effects on neighboring jurisdictions.
(a) Within 30 days after the Regional Administrator receives notice
in accordance with Sec. 121.12(a), the Regional Administrator shall
determine whether a discharge from the project may affect water quality
in a neighboring jurisdiction.
(b) If the Regional Administrator determines that the discharge
from the project may affect water quality in a neighboring
jurisdiction, within 30 days after receiving notice in accordance with
Sec. 121.12(a), the Regional Administrator shall notify the
neighboring jurisdiction, the Federal agency, and the project proponent
in accordance with paragraph (c) of this section.
(c) Notification from the Regional Administrator shall be in
writing and shall include:
(1) A statement that the Regional Administrator has determined that
a discharge from the project may affect the neighboring jurisdiction's
water quality;
(2) A copy of the Federal license or permit application and related
certification or waiver; and
(3) A statement that the neighboring jurisdiction has 60 days after
such notification to notify the Regional Administrator and the Federal
agency, in writing, if it has determined that the discharge will
violate any of its water quality requirements, to object to the
issuance of the Federal license or permit, and to request a public
hearing from the Federal agency.
(d) A Federal license or permit shall not be issued pending the
conclusion of the process described in this section, and Sec. Sec.
121.14 and 121.15.
Sec. 121.14 Objection from notified neighboring jurisdiction and
request for a public hearing.
(a) If a neighboring jurisdiction notified by the Regional
Administrator pursuant to Sec. 121.13(b) determines that a discharge
from the project will violate any of its water quality requirements, it
shall notify the Regional Administrator and the Federal agency in
accordance with paragraph (b) of this section within 60 days after
receiving such notice from the Regional Administrator.
(b) Notification from the notified neighboring jurisdiction shall
be in writing and shall include:
(1) A statement that the notified neighboring jurisdiction objects
to the issuance of the Federal license or permit;
(2) An explanation of the reasons supporting the notified
neighboring jurisdiction's determination that the discharge from the
project will violate its water quality requirements, including but not
limited to, an identification of those water quality requirements that
will be violated; and
(3) A request for a public hearing from the Federal agency on the
notified neighboring jurisdiction's objection.
(c) The notified neighboring jurisdiction may withdraw its
objection prior to the public hearing. If the notified neighboring
jurisdiction withdraws its objection, it shall notify the Regional
Administrator and the Federal agency, in writing, of such withdrawal.
Sec. 121.15 Public hearing and Federal agency evaluation of
objection.
(a) Upon a request for hearing from a notified neighboring
jurisdiction in accordance with Sec. 121.14(b), the Federal agency
shall hold a public hearing on the notified neighboring jurisdiction's
objection to the Federal license or permit, unless the objection is
withdrawn in accordance with Sec. 121.14(c).
(b) The Federal agency shall provide public notice at least 30 days
in advance of the hearing to interested parties, including but not
limited to the notified neighboring jurisdiction, the certifying
authority, the project proponent, and the Regional Administrator.
(c) At the hearing, the Regional Administrator shall submit to the
Federal agency its evaluation and recommendation(s) concerning the
objection.
(d) The Federal agency shall consider recommendations from the
notified neighboring jurisdiction and the Regional Administrator, and
any additional evidence presented to the Federal agency at the hearing,
and determine whether additional Federal license or permit conditions
may be necessary to ensure that any discharge from the project will
comply with the neighboring jurisdiction's water quality requirements.
If such conditions may be necessary, the Federal agency shall include
them in the Federal license or permit.
(e) If additional Federal license or permit conditions cannot
ensure that the discharge from the project will comply with the
notified neighboring jurisdiction's water quality requirements, the
Federal agency shall not issue the Federal license or permit.
Subpart C--Certification by the Administrator
Sec. 121.16 When the Administrator certifies.
(a) Certification or waiver by the Administrator is required where
no state, Tribe, or interstate agency has authority to give such a
certification.
(b) When acting pursuant to this section, the Administrator shall
comply with the requirements of Clean Water Act section 401 and this
part.
Sec. 121.17 Public notice and hearing.
(a) Within 20 days of the date that the request for certification
was received, the Administrator shall provide public notice of the
request for certification. Following such public notice, the
Administrator shall provide an opportunity for public comment.
(b) If the Administrator determines that a public hearing on a
request for certification is appropriate, the Administrator shall
schedule such hearing at an appropriate time and place and, to the
extent practicable, give all interested and potentially affected
parties the opportunity to present evidence or testimony in person or
by other means.
Subpart D--Review and Advice
Sec. 121.18 Review and advice.
Upon the request of any Federal agency, certifying authority, or
project proponent, the Administrator shall provide any relevant
information on applicable effluent limitations, or other limitations,
standards, regulations, or requirements, or water quality criteria, and
shall, when requested by any Federal agency, certifying authority, or
project proponent, comment on any methods to comply with such
limitations, standards, regulations, requirements, or criteria.
[[Page 66666]]
Subpart E--Severability
Sec. 121.19 Severability.
The provisions of this part are separate and severable from one
another. If any provision is stayed or determined to be invalid, the
remaining provisions shall continue in effect.
PART 122--EPA ADMINISTERED PERMIT PROGRAMS: THE NATIONAL POLLUTANT
DISCHARGE ELIMINATION SYSTEM
0
2. The authority citation for part 122 continues to read as follows:
Authority: The Clean Water Act, 33 U.S.C. 1251 et seq.
0
3. Amend Sec. 122.4 by revising paragraph (b) to read as follows:
Sec. 122.4 Prohibitions (applicable to State NPDES programs, see
Sec. 123.25).
* * * * *
(b) When the applicant is required to obtain a State or other
appropriate certification under section 401 of the CWA and that
certification has not been obtained or waived;
* * * * *
0
4. Amend Sec. 122.44 by revising paragraph (d)(3) to read as follows:
Sec. 122.44 Establishing limitations, standards, and other permit
conditions (applicable to State NPDES programs, see Sec. 123.25).
* * * * *
(d) * * *
(3) Conform to the conditions in a State certification under
section 401 of the CWA when EPA is the permitting authority;
* * * * *
0
5. Amend Sec. 122.62 by revising paragraph (a)(3)(iii) to read as
follows:
Sec. 122.62 Modification or revocation and reissuance of permits
(applicable to State programs, see Sec. 123.25).
* * * * *
(a) * * *
(3) * * *
(iii) For changes based upon modified State certifications of NPDES
permits, see Sec. 121.10 of this chapter.
* * * * *
PART 124--PROCEDURES FOR DECISIONMAKING
0
6. The authority citation for part 124 continues to read as follows:
Authority: Resource Conservation and Recovery Act, 42 U.S.C.
6901 et seq.; Safe Drinking Water Act, 42 U.S.C. 300f et seq.; Clean
Water Act, 33 U.S.C. 1251 et seq.; Clean Air Act, 42 U.S.C. 7401 et
seq.
0
7. Amend Sec. 124.53 by revising paragraphs (b) through (e) to read as
follows:
Sec. 124.53 State certification.
* * * * *
(b) Consistent with the requirements set forth in Sec. Sec. 121.4
and 121.5 of this chapter, applications for individual permits may be
forwarded by the Regional Administrator to the certifying State agency
with a request to act on the request for certification consistent with
Sec. 121.7 of this chapter.
(c) If State certification has not been requested by the time the
draft permit is prepared, the Regional Administrator shall send the
certifying State agency a request for certification consistent with
Sec. 121.5 of this chapter and include a copy of the draft permit.
(d) State certification shall be granted or denied within the
reasonable period of time as required under CWA section 401(a)(1). The
State shall send a notice of its action, including a copy of any
certification, to the applicant and the Regional Administrator.
(e) State certification on a draft permit may include a statement
of the extent to which each condition of the draft permit can be made
less stringent without violating the requirements of State law,
including water quality standards.
0
8. Amend Sec. 124.54 by revising paragraphs (a) and (b) to read as
follows:
Sec. 124.54 Special provisions for State certification and
concurrence on applications for section 301(h) variances.
(a) When an application for a permit incorporating a variance
request under CWA section 301(h) is submitted to a State, the
appropriate State official shall either:
(1) Deny the request for the CWA section 301(h) variance (and so
notify the applicant and EPA) and, if the State is an approved NPDES
State and the permit is due for reissuance, process the permit
application under normal procedures; or
(2) Forward a copy of the certification required under CWA section
401(a)(1) to the Regional Administrator.
(b) When EPA issues a tentative decision on the request for a
variance under CWA section 301(h), and no certification has been
received under paragraph (a) of this section, the Regional
Administrator shall forward the tentative decision to the State. If the
State fails to deny or grant certification and concurrence under
paragraph (a) of this section within the reasonable period of time
provided in CWA section 401(a)(1), certification shall be waived and
the State shall be deemed to have concurred in the issuance of a CWA
section 301(h) variance.
* * * * *
0
9. Amend Sec. 124.55 by:
0
a. Revising paragraph (a);
0
b. Removing paragraph (b);
0
c. Redesignating paragraphs (c) through (f) as paragraphs (b) through
(e), respectively; and
0
d. Revising newly redesignated paragraphs (b) and (c).
The revisions read as follows:
Sec. 124.55 Effect of State certification.
(a) When certification is required under CWA section 401(a)(1), no
final permit shall be issued:
(1) If certification is denied; or
(2) Unless the final permit incorporates the conditions specified
in the certification.
(b) A State may not condition or deny a certification on the
grounds that State law allows a less stringent permit condition.
(c) A condition in a draft permit may be changed during agency
review in any manner consistent with a corresponding certification. No
such changes shall require EPA to submit the permit to the State for
recertification.
* * * * *
[FR Doc. 2023-20219 Filed 9-26-23; 8:45 am]
BILLING CODE 6560-50-P