U.S. Supreme Court rules against EPA in wetlands regulation challenge

By John Kruzel and Nate Raymond

(Reuters) -The U.S. Supreme Court on Thursday put another dent in the regulatory reach of the Environmental Protection Agency, ruling in favor of an Idaho couple in their long-running bid to build a home on property that the EPA had deemed a protected wetland under a landmark federal anti-pollution law.

The justices in a 9-0 decision overturned a lower court’s ruling against the couple, Chantell and Mike Sackett, that had upheld the EPA’s determination that their property near a lake contained wetlands protected by the Clean Water Act of 1972. Though the justices unanimously agreed to reverse the lower court’s decision, they differed in their reasoning for doing so.

The ruling marked the latest instance of the court backing a challenge to the scope of the EPA’s ability to regulate in the environmental arena under existing law. In a 6-3 ruling last June powered by its conservative justices, the court imposed limits on the EPA’s authority to issue sweeping regulations involving greenhouse gas emissions from existing coal- and gas-fired power plants under a different environmental law, the Clean Air Act.

The case decided on Thursday stemmed from the Sacketts’ purchase in 2004 of an undeveloped plot of land about 300 feet (90 meters) from Priest Lake, one of the largest lakes in Idaho, near the U.S.-Canada border. In 2007, the couple began preparing construction of a home on it.

But after placing sand and gravel fill on the lot, the EPA issued an administrative compliance order stating the property contained wetlands protected by the Clean Water Act and that they needed a permit to build, which they had failed to obtain.

That law bars discharging pollutants, including rocks and sand, into the “waters of the United States,” which regulators for decades have said covers not just navigable waters but adjacent wetlands like swamps, marshes and berms.

Courts and regulators have been grappling for decades over how much of a connection with a waterway a property must have in order to require a permit, with the Supreme Court issuing a ruling in 2006 that led to further uncertainty.

Four justices at that time said the law governed land with a “continuous surface connection” to a waterway while Justice Anthony Kennedy, who cast the deciding vote in the 5-4 case and has since retired, said the law extended further to areas that had a “significant nexus” to a waterway.

The Sacketts had asked the Supreme Court to revisit the issue after the San Francisco-based 9th U.S. Circuit Court of Appeals relied on Kennedy’s test in upholding a judge’s determination that the Sacketts’ property contained wetlands.

The dispute reached the Supreme Court once before, with the justices ruling unanimously in 2012 that the couple could challenge in court the EPA’s compliance order, which exposed them to financial penalties if they did not comply.

The court’s Thursday ruling came after President Joe Biden’s administration in December finalized a rule expanding the definition of waterways that are protected under the Clean Water Act, in a reversal from former President Donald Trump’s era. Biden in April vetoed a congressional measure that sought to overturn the rule.

A federal judge in North Dakota on April 12 temporarily blocked implementation of the rule in 24 states in response to a lawsuit by mostly Republican-led states. In a separate ruling, a federal judge in Texas on March 19 blocked the rule from being enforced in Texas and Idaho at the request of Republican attorneys general amid legal challenges to the new regulation. The rule was also halted in Kentucky on May 10 by the 6th U.S. Circuit Court of Appeals while the state appeals a lower court’s ruling. 

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