In an internal draft of new guidance designed to clarify their jurisdiction under the Clean Water Act, the Environmental Protection Agency and the Corps of Engineers explain the regulated community can expect that “the number of waters found to be subject to CWA jurisdiction will increase significantly[.]” The agencies have been refining their interpretation of “waters of the United States” subject to Clean Water Act jurisdiction since the Supreme Court decided Solid Waste Agency of Northern Cook County (SWANCC) v. US Army Corps of Engineers and U.S. v. Rapanos. The guidance clarifies what the agencies regard as a “significant nexus” as discussed in Justice Kennedy’s opinion in Rapanos. The draft also suggests the agencies will seek to revisit limits imposed on their jurisdiction under SWANCC to regulate so-called “other waters” including intrastate wetlands, mudflats, prairie potholes and the like through future regulatory action. In the meantime, the agencies will make case-by-case determinations of their jurisdiction over such waters. While the guidance does not constitute a formal rule, the agencies have indicated they would open the guidance to public comment.

On March 28, 2011, the Colorado Supreme Court dismissed claims from well owners that the State’s decision to curtail their use amounted to an unconstitutional taking.  Kobobel v. State, Dept. of Natural Resources,  --- P.3d ----, 2011 WL 1106978 (Colo. 2011).  The well owners had obtained their decreed water rights before enactment of Colorado’s 1969  Water Right Determination and Administration Act.   They first argued their underground water appropriations, having been decreed before the Act when tributary groundwater was not administered by the State, were vested property rights in “unappropriated, nontributary groundwater” and that those rights had been taken by the State without payment of just compensation.  They also contended that the State’s cease and desist orders precluding them from using their wells amounted to a regulatory taking because the State only recently issued the orders after decades of allowing the well owners to pump out of priority.  Both the U.S. Constitution and the Colorado Constitution prohibit the taking of private property for public use without just compensation.  However, the Court rejected the plaintiffs’ arguments that any impermissible taking had occurred.  The Court explained that the plaintiffs’ uses, as tributary groundwater, were inherently subject to regulation for the benefit of senior users.  Because the well owners were found to have no constitutionally protected property interest in the unfettered use of the water in their wells, the court reasoned, they could not show that the State had taken their property by curtailing the out-of-priority use of their wells.

The Federal District Court for the District of Idaho, on March 17, 2011, held that a man-made canal, without an interstate connection, and with only seasonal flow falls within the U.S. Army Corps of Engineers’ jurisdiction under Section 404 of the Clean Water Act.   U.S. v. Vierstra,  2011 WL 1064526 (D. Idaho 2011).  The defendant, charged with criminal wrongdoing, allegedly discharged process wastewater from a concentrated animal feeding operation into the Low-Line Canal.  The canal carries water during an 8-month irrigation season, but is generally otherwise dry.  In the face of a motion to dismiss for lack of subject matter jurisdiction, the court found the Government's allegations, if proven, would support a finding that the Low Line Canal is a non-navigable tributary eventually discharging water into a navigable “water of the United States,” a prerequisite for jurisdiction under the Clean Water Act.  The court found the Low Line Canal is part of a continuous channel with a distinct, open, and direct surface water connection to and from navigable waters for six to eight months out of the year.  Accordingly, the court found the Low-Line Canal met both the “relatively permanent” and “significant nexus” standards set forth in the plurality and concurrent decisions set forth inRapanos v. United States, 547 U.S. 715 (2006).  Discharges into the canal, including those occurring when the canal was dry, could violate the Clean Water Act.

On January 31, 2011, the California Supreme Court upheld the constitutionality of the State Water Resources Control Board's water right fee program. California Farm Bureau Federation v. State Water Resources Control Board.  By way of background, California’s Water Code was amended in 2003 to require the Board to collect user fees to support the work of its Water Rights Division. The fees are paid by each state permit and license holder, and federal contractors with rights in U.S. Bureau of Reclamation projects. When the Board adopted regulations establishing the fees, various water right holders sued.  The plaintiffs argued the fee program was unconstitutional “on its face” because the fee imposed a tax (which under California law requires a two-thirds vote of the Legislature), not a regulatory fee (which requires only a majority vote).  The court dismissed the argument, finding instead that the fee program establishes a permissible regulatory fee for the purpose of paying the costs of administering a regulatory program, thus requiring a simple majority vote of the Legislature.  The court concluded the water right fee statutes were facially constitutional, and remanded the matter for further consideration of an independent “as applied” challenge.