Stay Calm: Regulation on Wetlands Not in Jeopardy

State Hearing in December No Cause for Worry.

Last month, when the EPA announced it will be holding a hearing on Dec. 11 in Lansing regarding Michigan’s wetlands law, a few people may have panicked thinking the EPA was  ready to withdraw its delegation of wetland regulation in the state.

Michigan is one of only two states to have been delegated authority to administer the federal wetland regulations within their borders. (The state was the first, earning this designation in 1984).  This summer,  the Michigan Legislature enacted Public Act 98, amending multiple parts of the Michigan environmental code regarding wetlands. Some of the changes stemmed from a 2008 audit by the EPA of the Michigan wetland program which raised some 20 concerns that the Michigan program materially deviated from the federal program.

The EPA’s meeting notice does not use the word “withdraw,” which would be required by federal law to begin the withdrawal process. The applicable regulations create a lengthy process for such withdrawal including opportunities for challenges. Instead, the EPA’s notice focuses on three main areas of concern the EPA has regarding the measure:

  1. Changes to the definition of contiguous wetlands regulated by Michigan’s Clean Water Act Section 404 program;
  2. The addition of new exemptions from permitting; and
  3. Changes to the requirements for mitigating the effects of filling wetlands and other waters of the country.

The EPA said substantial changes to state Clean Water Act, Section 404 programs do not take effect until program revisions are approved by the EPA and it wants to consider these issues. The EPA has not formally even taken a position as to what its concerns are. If the EPA were to have a problem with these changes, it would pose significant confusion as to the effect of those provisions of PA 98 but it does not necessarily mean that Michigan is losing the program.

There are a number of places in the law where contiguity is defined. I’m sure EPA finds that very problematic as the agency has been arguing for a broader approach for some time (and often winning that argument in the courts). This new definition of what is not contiguous seems to replace a regulatory definition which included wetlands within 500 feet of lakes and streams and within 1,000 feet of a Great Lake or Lake St. Clair in favor of a more nebulous standard. That is very important as to whether wetlands without a direct surface connection to a body of water are regulated. The EPA also complained about an amendment making excavations adjoining a surface water body by definition “not contiguous.”

The permit exemptions largely relate to work in agricultural and other drains.The EPA also reportedly took issue with statutory language that called for new rules in one year, allowing agricultural mitigation by means of some sort of conservation easement on the impacted property, and which seems to allow mitigation by means of a payment of a fee which may not meet federal standards for an in-lieu-fee mitigation program.

If EPA actually revoked Michigan’s delegation under Clean Water Act, Section 404, applicants for dredge and fill/wetland permits would have to seek their permits from the U.S. Army Corps of Engineers. The Corps would also take over enforcement of Section 404 in Michigan. Most people, including me, view this as very undesireable. Most interesting, is the “poison pill” that the Legislature included in PA 98 which provides that if the EPA revokes Michigan’s 404 authority that the entirety of Part 303 authorizing Michigan regulation of wetlands would also be automatically repealed 160 days later.

If EPA were actually to withdraw Michigan’s delegation, this could mean: no permits would be required for non-federal waters (although what that means is open to debate these days) in Michigan except where there are local ordinances; overloading federal regulators who currently are not staffed to regulate or permit in Michigan; more draconian approaches as the federal government is likely to be less flexible than state regulators; and no state involvement at all (other states have some preliminary process before a permit application is referred to the Corps).

This has been part of an ongoing dialogue since 2008, including a threat by the Granholm administration to let the program go back to the feds. The regulated community largely expressed its desire to stay with the agency it knows and the state listened. Given that the EPA has merely asked for a hearing on three issues (some of which can be clarified regulatorily), will this mean the end of wetland regulation in Michigan as we know it? I highly doubt it.