Supreme Court Upholds Corps’ Slurry Discharge Permit

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SandBar 8:3, October, 2009 Recommended citation: Proctor, Jonathan , Supreme Court Upholds Corps' Slurry Discharge Permit , 8:3 SandBar 3 (2009). Supreme Court Upholds Corps’ Slurry Discharge Permit Coeur Alaska, Inc. v. Southeast Alaska Conservation Council, 129 S. Ct. 2458 (2009). *Jonathan Proctor, 3L, University of Mississippi School of Law* The U.S. Supreme Court recently held that the U.S. Army Corps of Engineers, not the Environmental Protection Agency (EPA), has authority under the Clean Water Act (CWA) to issue permits for the discharge of fill material into navigable waters. The Court upheld the Corps’ issuance of a permit to a mining company to dispose mining waste into a lake. In doing so, the Court may have offered similar mining operations a “loophole” in circumventing the CWA. Background As part of its plans to reopen a long-abandoned gold mine, Couer Alaska planned to churn the mine’s crushed rock in water and chemicals. The mixture, called “slurry,” causes the gold-bearing materials to float to the surface where it can be easily extracted. Typically, the remaining slurry is pumped into a pond excavated specifically for this purpose. However, Coeur Alaska sought a permit from the U.S. Army Corps of Engineers (Corps) to dispose of the slurry in nearby Lower Slate Lake, a navigable body of water subject to the CWA. Pursuant to § 402 of the CWA, the EPA (or the state if it has been delegated permitting authority) determines whether to approve permits for the discharge of pollutants from a point source into U.S. waters. However, § 404(a) of the CWA authorizes the Corps to grant permits for the discharge of “dredged or fill material.”1 The Corps and the Environmental Protection Agency (EPA) both define fill material to include slurry.2 Both agencies agreed that Coeur Alaska’s proposed slurry qualifies as fill material due to its “effect of... ‘[c]hanging the bottom elevation’ of water.”3 Coeur Alaska’s plan included diverting the surrounding waters (in order to prevent spreading the pollution downstream) and covering the lake bed slurry with native materials upon the completion of mining operations. The alternative would have been to dump slurry on nearby wetlands, causing a permanent loss. Given the choice between a permanent loss of an estimated 60 acres of wetlands or the temporary harm to a relatively small lake, the Corps approved Coeur Alaska’s proposal to dispose of the mining slurry in Lower Slate Lake as the “‘least environmentally damaging practicable’” option.4 Under § 404(c) of the CWA, the EPA has authority to veto the Corps’ permit decision, but did not do so in this instance. The Southeast Alaska Conservation Council and other environmental groups (SEACC) filed suit, arguing that the EPA, not the Corps, should have considered the permit application. SEACC also contended that the Corps improperly approved the permit, citing the EPA’s performance standards promulgated under CWA § 301 and § 306. The standards prohibit discharges like these and do not have exceptions for dredge or fill material. A federal district court found that the Corps did have jurisdiction to issue the permit. The Ninth Circuit disagreed, finding that the dischargers were required to comply with the EPA’s performance standards and that the company was required to obtain a § 402 permit for its activities. Slurry Discharge Permits: EPA or Corps? On appeal, the U.S. Supreme Court first addressed whether the EPA or the Corps was the appropriate agency to consider slurry dumping permit applications. The slurry, when deposited into Lower Slate Lake, would raise the bottom level of the lake, meeting the EPA’s and the Corps’ definition of fill material. When a discharge falls under Corps’ § 404 permitting authority, EPA loses its § 402 permitting authority. The court noted that “[t]he Act is best understood to provide that if the Corps has authority to issue a permit for a discharge under §404, then the EPA lacks authority to do so under §402.”5 Regulations for both the Corps and EPA clearly prevent EPA from issuing permits for § 404 discharges. Specifically, EPA’s own regulations dictate that discharges subject to Corps’ § 404 permits are exempt from §402 permits. Because both agencies agreed that Coeur Alaska’s proposed slurry qualifies as fill material, the Court found that the Corps had authority to permit the discharge. The Court also noted that the EPA had the authority to override the Corps’ permit approval but declined to exercise this power. Though it found Coeur Alaska’s lake dumping plan less than preferable, “the EPA in effect deferred to the judgment of the Corps on this point.”6 Not only did the EPA decline to veto the Corps permit, but it also issued a permit governing the discharge of water from Lower Slate Lake into a downstream creek, contingent upon the satisfaction of certain water quality standards. The Court held that the Corps, not the EPA, has the authority under the CWA and its associated agency regulations to issue permits regarding the disposal of fill material into navigable waters. Furthermore, the Court found that the Corps issued the Lower Slate Lake permit to Coeur Alaska in a manner consistent with the CWA and those regulations. EPA Performance Standards The Court next considered whether “EPA performance standards...apply to discharges of fill material?”7 Under the CWA, the EPA has the authority to regulate mining operations. SEACC argued that the CWA and the agencies’ regulations conflict with each other: the Corps may issue permits for fill material discharge, yet the EPA may restrict discharge from mining operations under § 306. SEACC argued that the slurry discharge would violate EPA’s performance standards under § 306. The Court resolved this conflict by interpreting the omission of § 306 (new source performance standards) from §404 (granting the Corps authority to issue dredged and fill material permits) as Congressional intent. The exclusion of § 306 from § 404, the Court reasoned, “is evidence that Congress did not intend § 306(e) to apply to Corps § 404 permits or to discharges of fill material.”8 Whether this omission amounts to intent or merely oversight is debatable, but proved satisfactory for the Court. Additionally, the Court relied upon an internal EPA memo that addressed the scope of § 306, the ability of the Corps to make decisions in the public’s interest, and the difference between the slurry in this case and more dangerous, toxic pollutants. Though not bound by the memo, the Court found it instructive and well reasoned, ultimately deferring to its conclusion that the slurry discharge did not violate EPA’s performance standards. Conclusion The Court deferred to the agencies’ interpretation of the CWA, upholding the Corps’ authority to issue permits for the discharge of fill material and declining to extend EPA new source performance standards to those permits. Endnotes 1. 33 U.S.C. §1344(a). 2. 40 C.F.R. §232.2. 3. Couer Alaska, Inc. v. Southeast Alaska Conservation Council, 129 S.Ct. 2458, 2459 (2009). 4. Coeur Alaska, Inc. at 2465. 5. 40 C.F.R. § 122.3. 6. Coeur Alaska, Inc. at 2465. 7. Id. at 2469. 8. Id. at 2471.
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SandBar 8:3, October, 2009
Recommended citation: Proctor, Jonathan , Supreme Court Upholds Corps' Slurry Discharge Permit , 8:3 SandBar 3 (2009).

Coeur Alaska, Inc. v. Southeast Alaska Conservation Council, 129 S. Ct. 2458 (2009).

Jonathan Proctor, 3L, University of Mississippi School of Law

The U.S. Supreme Court recently held that the U.S. Army Corps of Engineers, not the Environmental Protection Agency (EPA), has authority under the Clean Water Act (CWA) to issue permits for the discharge of fill material into navigable waters. The Court upheld the Corps’ issuance of a permit to a mining company to dispose mining waste into a lake. In doing so, the Court may have offered similar mining operations a “loophole” in circumventing the CWA.

Background
As part of its plans to reopen a long-abandoned gold mine, Couer Alaska planned to churn the mine’s crushed rock in water and chemicals. The mixture, called “slurry,” causes the gold-bearing materials to float to the surface where it can be easily extracted. Typically, the remaining slurry is pumped into a pond excavated specifically for this purpose. However, Coeur Alaska sought a permit from the U.S. Army Corps of Engineers (Corps) to dispose of the slurry in nearby Lower Slate Lake, a navigable body of water subject to the CWA.
      Pursuant to § 402 of the CWA, the EPA (or the state if it has been delegated permitting authority) determines whether to approve permits for the discharge of pollutants from a point source into U.S. waters. However, § 404(a) of the CWA authorizes the Corps to grant permits for the discharge of “dredged or fill material.”1 The Corps and the Environmental Protection Agency (EPA) both define fill material to include slurry.2 Both agencies agreed that Coeur Alaska’s proposed slurry qualifies as fill material due to its “effect of... ‘[c]hanging the bottom elevation’ of water.”3
      Coeur Alaska’s plan included diverting the surrounding waters (in order to prevent spreading the pollution downstream) and covering the lake bed slurry with native materials upon the completion of mining operations. The alternative would have been to dump slurry on nearby wetlands, causing a permanent loss. Given the choice between a permanent loss of an estimated 60 acres of wetlands or the temporary harm to a relatively small lake, the Corps approved Coeur Alaska’s proposal to dispose of the mining slurry in Lower Slate Lake as the “‘least environmentally damaging practicable’” option.4 Under § 404(c) of the CWA, the EPA has authority to veto the Corps’ permit decision, but did not do so in this instance.
      The Southeast Alaska Conservation Council and other environmental groups (SEACC) filed suit, arguing that the EPA, not the Corps, should have considered the permit application. SEACC also contended that the Corps improperly approved the permit, citing the EPA’s performance standards promulgated under CWA § 301 and § 306. The standards prohibit discharges like these and do not have exceptions for dredge or fill material.
      A federal district court found that the Corps did have jurisdiction to issue the permit. The Ninth Circuit disagreed, finding that the dischargers were required to comply with the EPA’s performance standards and that the company was required to obtain a § 402 permit for its activities.

Slurry Discharge Permits: EPA or Corps?
On appeal, the U.S. Supreme Court first addressed whether the EPA or the Corps was the appropriate agency to consider slurry dumping permit applications. The slurry, when deposited into Lower Slate Lake, would raise the bottom level of the lake, meeting the EPA’s and the Corps’ definition of fill material. When a discharge falls under Corps’ § 404 permitting authority, EPA loses its § 402 permitting authority. The court noted that “[t]he Act is best understood to provide that if the Corps has authority to issue a permit for a discharge under §404, then the EPA lacks authority to do so under §402.”5 Regulations for both the Corps and EPA clearly prevent EPA from issuing permits for § 404 discharges. Specifically, EPA’s own regulations dictate that discharges subject to Corps’ § 404 permits are exempt from §402 permits. Because both agencies agreed that Coeur Alaska’s proposed slurry qualifies as fill material, the Court found that the Corps had authority to permit the discharge.
The Court also noted that the EPA had the authority to override the Corps’ permit approval but declined to exercise this power. Though it found Coeur Alaska’s lake dumping plan less than preferable, “the EPA in effect deferred to the judgment of the Corps on this point.”6 Not only did the EPA decline to veto the Corps permit, but it also issued a permit governing the discharge of water from Lower Slate Lake into a downstream creek, contingent upon the satisfaction of certain water quality standards.
The Court held that the Corps, not the EPA, has the authority under the CWA and its associated agency regulations to issue permits regarding the disposal of fill material into navigable waters. Furthermore, the Court found that the Corps issued the Lower Slate Lake permit to Coeur Alaska in a manner consistent with the CWA and those regulations.

EPA Performance Standards
The Court next considered whether “EPA performance standards...apply to discharges of fill material?”7 Under the CWA, the EPA has the authority to regulate mining operations. SEACC argued that the CWA and the agencies’ regulations conflict with each other: the Corps may issue permits for fill material discharge, yet the EPA may restrict discharge from mining operations under § 306. SEACC argued that the slurry discharge would violate EPA’s performance standards under § 306. The Court resolved this conflict by interpreting the omission of § 306 (new source performance standards) from §404 (granting the Corps authority to issue dredged and fill material permits) as Congressional intent.
The exclusion of § 306 from § 404, the Court reasoned, “is evidence that Congress did not intend § 306(e) to apply to Corps § 404 permits or to discharges of fill material.”8 Whether this omission amounts to intent or merely oversight is debatable, but proved satisfactory for the Court. Additionally, the Court relied upon an internal EPA memo that addressed the scope of § 306, the ability of the Corps to make decisions in the public’s interest, and the difference between the slurry in this case and more dangerous, toxic pollutants. Though not bound by the memo, the Court found it instructive and well reasoned, ultimately deferring to its conclusion that the slurry discharge did not violate EPA’s performance standards.

Conclusion
The Court deferred to the agencies’ interpretation of the CWA, upholding the Corps’ authority to issue permits for the discharge of fill material and declining to extend EPA new source performance standards to those permits.

Endnotes
1.   33 U.S.C. §1344(a).
2.   40 C.F.R. §232.2.
3.   Couer Alaska, Inc. v. Southeast Alaska Conservation Council, 129 S.Ct. 2458, 2459 (2009).
4.   Coeur Alaska, Inc. at 2465.
5.   40 C.F.R. § 122.3.
6.   Coeur Alaska, Inc. at 2465.
7.   Id. at 2469.
8.   Id. at 2471.