Petition for Writ of Certiorari — City of Healdsburg, California v. Northern California River Watch (No. 07-625)

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Supreme Court, U.S.

FILED

07-626 ni $- 2007

No. l OFFICE OF THE CLERK

In The

Supreme Court of the United States

CITY OF HEALDSBURG,

Petitioner,

Vv.

NORTHERN CALIFORNIA RIVER WATCH,

Respondent.

On Petition for Writ of Certiorari

to the United States Court of Appeals

for the Ninth Circuit

PETITION FOR WRIT OF CERTIORARI

PETER W. McGaw

Counsel of Record

JOHN L. KortTUM

Tuomas H. PAcHECO

ARCHER NORRIS

2033 NortH MAIN STRET

SuITE 800

WALNUT CREEK, CA 94596

(925) 930-6600

Attorneys for Petitioner

Becker Gallagher - Cincinnati, OH - Washington, D.C. - 800.890.5001

QUESTIONS PRESENTED

1. Did the Ninth Circuit stretch federal Clean

Water Act jurisdiction beyond permissible limits,

invading state authority and exceeding Congressional

intent, when it held that discharges into a

groundwater aquifer is regulable under the Clean

Water Act because a subterranean aquifer is a

jurisdictional “wetland,” in conflict with other circuits

that have held Clean Water Act jurisdiction does not

extend to discharges into groundwater?

2. Did the Ninth Circuit fail its obligation to defer

to agency expertise and establish an impermissible

rule of law when it ignored both the national policy of

the Corps of Engineers regarding Clean Water Act

jurisdiction over gravel mining pits being reclaimed

and the Corps’ disclaimer of jurisdiction in this case,

and instead invented a diametrically opposite rule of

law?

3. Did the Ninth Circuit, in disregard of agency

expertise, err by ignoring the special status of

“adjacent wetlands” and extending Clean Water Act

jurisdiction to equate a man-made waterbody with an

“adjacent wetland.”

4. Did the Ninth Circuit establish an impossible

rule when it held that a “waste treatment system” may

not percolate to groundwater and must be recognized

in a federal permit in order to be exempt from

obtaining that same federal permit, effectively

nullifying the applicable regulations?

5. Did the Ninth Circuit err in holding that the

concurring opinion in Rapanos v. United States, 126

S.Ct. 2208 (2006), which endorsed a rule with which

eight justices expressly disagreed, nonetheless

established “substantial nexus” as the law of the land

regarding federal jurisdiction over adjacent wetlands?

6. Even if the Rapanos concurrence’s “substantial

nexus’ test is applicable, did the Ninth Circuit

misapply it because it ignored Justice Kennedy’s

admonition that, to be jurisdictional, wetlands must

“significantly affect the chemical, physical, and

biological integrity” of navigable-in-fact waters and

that jurisdiction fails when “wetlands’ effects on water

quality are speculative or insubstantial?”

lll

LIST OF ALL PARTIES

Petitioner: City of Healdsburg, a municipality

Respondent: Northern California River Watch, a

California corporation.

CORPORATE DISCLOSURE STATEMENT

Pursuant to Rule 29.6, Petitioner City of

Healdsburg hereby states that it is a municipality and

has no parent companies, subsidiaries, or affiliates

that have issued shares to the oublic.

TABLE OF CONTENTS

QUESTIONS PRESENTED ................... i

Beet COP ARE, PARE 6c eves cece ue uees bens lll

CORPORATE DISCLOSURE STATEMENT .... iv

‘FAG CE COED 6 tcc entered beswcaes Vv

TABLE OF AUTHORITIES .....ccccscvccccs viii

PETITION FOR WRIT OF CERTIORARI ....... 1

fo gi iit). Bs 2 8, nn rr Uraeern aye Geno 1

Rol) od Sey |e nn rae Nreeie rae exer: 1

STATUTORY AND REGULATORY PROVISIONS

Per SE oo 5 ov he ee ee eee 2

SE EERIE 8s hs 4 0 A ee 7

STATEMENT OF THE CASE ................ 9

REASONS FOR GRANTING THE WRIT

Cg ogy oS: ra em ry RO mr 16

:. THIS COURT SHOULD GRANT THE WRIT OF

CERTIORARI TO RESOLVE A CONFLICT AMONG

THE CIRCUITS ABOUT WHETHER THE CLEAN

WATER ACT APPLIES TO DISCHARGES INTO

GROUNDWATER

Il.

iif.

IV.

VI.

CONCLUSION

‘THIS COURT SHOULD GRANT THE WRIT OF

CERTIORARI TO REVIEW THE NINTH CIRCUIT’S

FAILURE TO EVEN ACKNOWLEDGE, LET

ALONE GIVE DEFERENCE TO, THE EXPERT

AGENCY’S DETERMINATION THAT BASALT

POND IS COVERED By THE EXCAVATION

OPERATION EXCEPTION ................

THIS COURT SHOULD GRANT THE WRIT OF

CERTIORARI TO REVIEW THE NINTH CIRCUIT’S

DECISION THAT IMPROPERLY EXTENDS CWA

JURISDICTION By LABELING ADJACENT

WATERBODIES AS ADJACENT WETLANDS

THIS COURT SHOULD GRANT THE WRIT OF

CERTIORARI TO RESOLVE WHETHER THE

NINTH CIRCUIT ADOPTED AN UNWORKABLE

INTERPRETATION OF THE WASTE TREATMENT

SYSTEM EXCEPTION ..........eccecees:

THIS COURT SHOULD GRANT THE WRIT OF

CERTIORARI TO DETERMINE THE

CONTROLLING RULE OF LAW FOR ADJACENT

WETLANDS AND TO RESOLVE A SPLIT IN THE

CIRCUITS ON THIS ISSUE ...............

ASSUMING THAT THE “SIGNIFICANT NEXUS”

TEST APPLIES, THIS COURT SHOULD GRANT

CERTIORARI TO RESOLVE THE ISSUE OF

WHETHER THERE CAN BE A SIGNIFICANT

NEXUS EVEN THOUGH THE WETLANDS’

EFFECT ON NAVIGABLE WATERS IS

INSUBSTANTIAL

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APPENDICES

Appendix A: 8/6/07 Circuit Court Order and

Opinion

Appendix B: 1/23/04 District Court Opinion. 21a

Appendix C: 3/8/04 Judgment

Appendix D: U.S. Army Corps of Engineers’

Disclaimer of Jurisdiction, dated Feb. 4,

NE oo oo ee ee oe ae 66a

vill

TABLE OF AUTHORITIES

Cases

Chevron U.S.A., Inc. v. NRDC,

GGT UB. Boe CIPO 56 ce ee Tee 24

EPA v. State Water Resources Control Board,

496: UB. BOO IGT) 66 ese eiees ctl a 18

Exxon Corporation v. Train,

554 F.2d 1310 (5th Cir. 1977) ....... 17, 18, 20

Inland Steel Co. v. E.P.A.,

901 F.26 1419 (7th Cir. 1960) .........4.--: 21

Kelley v. United States,

618 F.Supp. 1103 (W.D. Mich. 1985) ....... 20

Leslie Salt v. United States,

896 F.2d 354 (9th Cir. 1990),

cert. denied, 408 U.S. 1126 (1991) ......... 24

Marks v. United States,

490 Sh. SRB CAST nk 5 ook b eee 31, 32

Memoirs v. Massachusetts,

383 U.S. 45317068)... Seo cee eee 32

McClellan Ecological Seepage v. Weinberger,

107 F.Supp. 1182 (E.D. Cal. 1988) ......... 21

Rapanos v. United States,

126 S.Ct. SA GR) nes oe eee passim

Rice v. Harken Exploration Co.,

250 F.3d 264 (5th Cir. 2001) .............. 19

San Francisco Baykeeper v. Cargill Salt Div.,

481 F.3d 700 (9th Cir. 2007) .............. 27

Solid Waste Agency of Northern Cook County v. United

States Army Corps of Engineers,

he i) ) 26

Town of Norfolk v. U.S. Army Corps of Engineers,

968 F.2d 1438 (1st Cir. 1992) .......... 20, 21

Udall v. Tallman, 380 U.S. 1 (1965) .......... 24

United States v. GAF Corp.,

389 F.Supp. 1379 (S.D. Tex. 1975) ......... 20

United States v. Gerke Excavating, Inc.,

464 F.3d 723 (7th Cir. 2006) .............. 32

United States v. Johnson,

467 F.3d 56 (1st Cir. 2006),

cert. denied, 552 U.S. --- (Oct. 9, 2007) ...... 33

United States v. Riverside Bayview Homes, Inc.,

mre ts. $2 (8960) .......... 21, 24, 25, 26, 36

United States v. Robison, Case No. 05-17019,

2007 WL 3087419 (11th Cir. Oct. 24, 2007) 33, 34

Village of Oconomowoc Lake v. Dayton Itudson Corp.,

24 F.3d 962 (7th Cir. 1994),

cert. denied, 513 U.S. 930 (1994) ....... 19, 20

Statutes

ee Rs OL . o> oe he ee ee eee 1

ee Na aee ED v ov cc'n soo bb eee wee uvevevaes 2

ae Grane De IER o's evs besa eee ees 2

Boe 8 ee eer ee 2.2

Regulations

33 C.F.R. § 328.3(a)-(c) (2005) ............ passim

SS C.F. $ SESTONF) on ccc cer cccconvecs 28

Oe A a Se 29

Eee pt 8 ee eee arnt nah 13

40 C.F.R. § 86.200G(12) .............-5.. 5, 6, 29

Oe Ga ee ee eee ees 3, 4, 5, 28

GULF ae OG RD ied ce ee rc be eet 5

Gl Peg. Hem. 4IF0G .. wc cece eess 6, 22, 23

oR 6, 7, 23

65 Fed. Reg. 12860 (March 9, 2000) ......... §, 23

Other

U.S. Army Corps of Engineers Wetlands Delineation

Manual, reproduced at www.wetlands.com/regs/tlp

MGR cee oe va ae Cae eer eee 28

PETITION FOR WRIT OF CERTIORARI

Petitioner City of Healdsburg (“Healdsburg”)

respectfully petitions this Court for a Writ of

Certiorari to review the judgment of the United States

Court of Appeals for the Ninth Circuit.

OPINIONS BELOW

The challenged opinion and order of the Court of

Appeals for the Ninth Circuit is reported as Northern

California River Watch v. City of Healdsburg, 496 F.3d

993 (9th Cir. 2007), and is attached as Appendix A.

This opinion follows a previous opinion issued on

August 10, 2006, reported at 457 F.3d 1023, that was

withdrawn. The District Court opinion, dated January

23, 2004, was unpublished, and is attached as

Appendix B. The judgment of the District Court is

attached as Appendix C. The jurisdictional

determination of the U.S. Army Corps of Engineers is

attached as Appendix D.

JURISDICTION

The opinion and order of the Court of Appeals for

the Ninth Circuit was entered on August 6, 2007.

That court’s denial of the Petition for Panel Rehearing

And Rehearing En Banc was entered on the same date.

This Court has jurisdiction under 28 U.S.C. § 1254(1).

STATUTORY AND REGULATORY

PROVISIONS AT ISSUE

The Clean Water Act (CWA) provides in pertinent

part:

Except as in compliance with this section and

section[] .. . 1342 of this title, the discharge of

any pollutant by any person shall be unlawful.

33 U.S.C. § 1311(a) (CWA § 301{a)).

Except as provided in sections 1328 and 1344 of

this title, the Administrator may, after

opportunity for public hearing, issue a permit

for the discharge of any pollutant, or

combination of pollutants, notwithstanding

section 1311(a) of this title, upon condition that

such discharge will meet either (A) all

applicable requirements under sections 1311,

1312, 1316, 1317, 1318, and 1343 of this title, or

(B) prior to the taking of necessary

implementing actions relating to all such

requirements, such conditions as_ the

Administrator determines are necessary to

carry out the provisions of this chapter.

33 U.S.C. § 1342(a)(1) (CWA § 402(a)(1)).

(5) The term “person” means an individual,

corporation, partnership, association, State,

municipality, commission, or _ political

subdivision of a State, or any interstate body.

(6) The term “pollutant” means dredged spoil,

solid waste, incinerator residue, sewage,

garbage, sewage sludge, munitions, chemical

wastes, biological materials, radioactive

materials, heat, wrecked or discarded

equipment, rock, sand, cellar dirt and

industrial, municipal, and agricultural waste

discharged into water.

(7) The term “navigable waters” means the

waters of the United States, including the

territorial seas.

33 U.S.C. § 1362(5)-(7) (CWA § 502(5)-(7)).

Federal regulations define “waters of the United

States” to mean:

(a) The term “waters of the United States”

means

(1) All waters which are currently used, or were

used in the past, or may be susceptible to use in

interstate or foreign commerce, including all

waters which are subject to the ebb and flow of

the tide;

(2) All interstate waters including interstate

wetlands;

(3) All other waters such as intrastate lakes,

rivers, streams (including § intermittent

streams), mudflats, sandflats, wetlands,

sloughs, prairie potholes, wet meadows, playa

lakes, or natural ponds, the use, degradation or

destruction of which could affect interstate or

foreign commerce including any such waters:

(i) Which are or could be used by interstate or

foreign travelers for recreational or other

purposes; or

Gi) From which fish or shellfish are or could be

taken and sold in interstate or foreign

commerce; or

(iii) Which are used or could be used for

industrial purpose by industries in interstate

commerce;

(4) All impoundments of waters otherwise

defined as waters of the United States under

the definition;

(5) Tributaries of waters identified in

paragraphs (a)(1)-(4) of this section;

(6) The territorial seas;

(7) Wetlands adjacent to waters (other than

waters that are themselves wetlands) identified

in paragraphs (a)(1)-(6) of this section.

(8) Waters of the United States do not include

prior converted cropland. Notwithstanding the

determination of an area's status as prior

converted cropland by any other federal agency,

for the purposes of the Clean Water Act, the

final authority regarding Clean Water Act

jurisdiction remains with EPA.

Waste treatment systems, including treatment

ponds or lagoons designed to meet the

requirements of CWA (other than cooling ponds

as defined in 40 CFR 423.11(m) which also meet

the criteria of this definition) are not waters of

the United States.

(b) The term “wetlands” means those areas that

are inundated or saturated by surface or ground

water at a frequency and duration sufficient to

support, and that under normal] circumstances

do support, a prevalence of vegetation typically

adapted for life in saturated soil conditions.

Wetlands generally include swamps, marshes,

bogs, and similar areas.

contiguous, or neighboring. Wetlands separated

from other waters of the United States by man-

made dikes or barriers, natural river berms,

beach dunes and the like are “adjacent

wetlands.”

33 C.F.R § 328.3(a)-(c) (2005); 40 C.F.R. § 122.2.

Federal regulations define “complete waste

treatment system” as:

A complete waste treatment system consists of

all the treatment works necessary to meet the

requirements of title III of the Act, involving:

(i) the transport of wastewater from individual

homes or buildings to a plant or facility where

treatment of the wastewater is accomplished;

(ii) the treatment of the wastewater to remove

pollutants; and

(111) the ultimate disposal, including recycling or

reuse, of the treated wastewater and residues

which result from the treatment process.

A) C.F.R. § 35.2005(12).

U.S. Army Corps of Engineers materials on the

“excavation operation exception” placed in the Federal

“(W]e generally do not consider the following

waters to be ‘Waters of the United States.” ...

(WJ: (e) . . . pits excavated in dry land for the

purpose of obtaining fill, sand or gravel unless

and until the construction or excavation

operation is abandoned.” 51 Fed. Reg. 41206,

41217 (1986).

“In most cases, a mining site where no

construction, mining, excavation, processing,

and/or reclamation activities have occurred

during the last 10 years would be considered

abandoned, at the district engineer's discretion.”

65 Fed. Reg. 12860 (March 9, 2000) (Final

Notice of Nationwide Permits).

“(The excavation operation exception] clearly

requires that the mining activity must have

stopped, and the reclamation completed, before

the area can be considered a water of the United

States” 64 Fed. Rey. 39252, 39335 (July 21,

1999) (Notice of Proposed Nationwide Permits).

INTRODUCTION

This case concerns the scope of federal jurisdiction

under the Clean Water Act (CWA) over underground

aquifers and man-made, water-filled pits. In the

decision below, the Ninth Circuit expanded CWA

jurisdiction far beyond that recognized by any Circuit

Court previously, holding that CWA jurisdiction

extends so far as to cover a man-made gravel mining

pit doubling as a municipal wastewater treatment

pond and the underground aquifer into which the

water in the pit percolates. The Ninth Circuit

concluded the underground aquifer is a “wetland,”

excising from the regulatory definition the

requirement that a wetland support vegetation. In

reaching this result, the Ninth Circuit failed to

acknowledge clear Congressional intent to exclude

state-regulated groundwater from the scope of the

Clean Water Act, creating a direct conflict with the

Fifth and Seventh Circuits, which have held there is

no CWA jurisdiction over discharges to groundwater.

In addition, the Ninth Circuit failed to show

deference to, and simply ignored, the stated national

policy and site-specific jurisdictional determination of

the expert agency, the U.S. Army Corps of Engineers

(Corps). Not only does the Corps have a national

policy of excluding from CWA jurisdiction gravel

mining pits undergoing reclamation, the Corps applied

that policy in a written jurisdictional determination,

declining to assert jurisdiction over the very same

gravel pit at issue in this case. (Appendix D) The

Ninth Circuit’s decision never even discussed either

the Corp’s policy or its site-specific jurisdictional

determination.

Simultaneously, the Ninth Circuit blurred the

distinction between “adjacent wetlands,” which are

afforded special regulatory status, and “waterbodies,”

for which Clean Water Act regulations grant no special

status based on proximity to navigable waters. In

doing so, the Ninth Circuit again failed to defer to

agency expertise.

Both the Corps and its sister agency, the United

States Environmental Protection Agency (EPA), by

adopted regulation, also exclude from CWA

jurisdiction waters that are part of a “waste treatment

system,” a term which includes disposal/percolation

ponds. Again failing to show deference to the expert

agencies, the Ninth Circuit created out of whole cloth

a circular rule that (a) prohibits a percolation pond

from percolating, or (b) requires a federal permit to

avoid the requirement of obtaining a federal permit for

waters in waste treatment systems. This strange rule

effectively nullifies the regulatory “waste treatment

system exception” and expands federal jurisdiction to

include thousands or possibly tens of thousands of

state-regulated percolation ponds and recycling and

land application systems.

The Ninth Circuit also misapplied Supreme Court

authority on “fragmented” opinions by this Court,

holding that the solo concurring opinion in this Court’s

recent “adjacent wetlands” decision, Rapanos v. United

States, 126 S.Ct. 2208 (2006), a concurrence the other

eight Justices chose not to join, nonetheless is

“controlling” and establishes the law of the land

regarding federal jurisdiction over “adjacent

wetlands,” again in conflict with other Circuits.

Compounding its error, the Ninth Circuit then

misapplied Justice Kennedy’s “substantial nexus” test,

ignoring its requirement of a “significant affect on the

chemical, physical and biological integrity” of a

navigable waterway, while purporting to apply pre-

Rapanos findings without remanding to the District

Court for application of its new jurisdictional test.

The Ninth Circuit’s opinion introduces conflicts and

errors of nationwide implication into the regulatory

scheme of Clean Water Act permitting. Review by this

Court is necessary to restore clarity and certainty for

states regulating their own’ groundwater,

municipalities and local agencies relying on man-made

percolation ponds and land application for wastewater

treatment and disposal, the gravel mining industry

trying to reclaim their left-over gravel pits, landowners

seeking to understand the regulatory effect of

overlying an “adjacent wetland” aquifer, and for

federal regulatory agencies trying to implement the

important goals of the federal Clean Water Act.

STATEMENT OF THE CASE

In 1971, the City of Healdsburg, California, a small

rural community located just over an hour north of

San Francisco, built a new wastewater treatment

plant. One of the principal purposes of this new

facility was to stop discharging the city’s treated

wastewater directly to the Russian River, a navigable

waterway used for recreation and water supply. The

solution? Use a polishing and percolation pond to

hold, treat, and dispose of treated wastewater. By

designing a plant to use percolation ponds as the final

stage of the treatment process, the engineers were able

to take advantage of natural biological treatment and

filtration to produce treated wastewater that, to this

day, meets virtually every federal and state drinking

water standard as it percolates out of the pond and

into the surrounding aquifer.

As it turned out, the engineers designing the new

plant were faced with a fortuitous circumstance.

Healdsburg’s vineyards and agricultural land sit on

top of a vast alluvial gravel bed, deposited over

millennia by the Russian River. Digging down

through dry land and deep into these gravel deposits,

gravel mining companies were excavating pits,

extracting gravel and allowing the pits to fill with

groundwater. When finished, the gravel companies

would “reclaim” the pits, either by filling them with

overburden and gravel-wash fines from the next pit or

by constructing natural-looking wetlands around their

borders.

Needing a percolation pond to complete its new

wastewater treatment plant, Healdsburg could have

spent millions of dollars condemning valuable

agricultural land and excavating a new percolation

pond. Alternatively, it could get exactly the same

treatment by using one of the existing gravel mining

pits at a fraction of the cost. Since Healdsburg was a

small community with limited resources, Healdsburg’s

engineers selected the latter option, specifically

designing the new wastewater treatment plant to use

the available, as-yet un-reclaimed gravel pits as

percolation ponds.

This design has worked for over 30 years, during

which period Healdsburg continued to use one gravel

pit — the 58-acre “Basalt Pond” — as the final stage of

its wastewater treatment process. Even after removal

of gravel from that particular gravel pit was complete

and reclamation started, the “pond” continued to

function as the final treatment and percolation pond

for Healdsburg’s wastewater treatment system.

Healdsburg’s use of the gravel pit was strictly

regulated by permits issued under the State of

California’s Porter-Cologne Water Quality Control Act,

widely recognized as the model for the Federal Clean

Water Act.

The Basalt Pond was generally 50 to several

hundred fect from the Russian River, depending on the

river stage. Over 30 years, the river has flooded into

the pond only two or three times. For the rest of the

time, the Russian River and the Basalt Pond have

remained separate. Even as reclamation activities in

the Basalt Pond began to construct wetlands around

the perimeter of the gravel pit, those wetlands

remained separated by “uplands” from the natural

wetlands along the Russian River.

Except on the rare occasion when the Russian River

floods, no surface water flows from the Basalt Pond or

its wetlands to the Russian River and its wetlands, or

vice versa. Water in the Basalt Pond percolates — after

a year of “polishing” in the pond — in al] directions into

the surrounding aquifer. Eventually, some of the

percolating groundwater that had originated in the

Basalt Pond reaches the Russian River, but never in

discernable amounts or with any discernable impact on

the water quality of the Russian River. While

computer models would later suggest that some

“chloride,” or salt, from Healdsburg’s wastewater

would reach the Russian River, the amount was so

small as to disappear in the background levels of salt

naturally present in the River.

Nonetheless, Plaintiff Northern California River

Watch (“River Watch”), filed this action to establish

federal CWA jurisdiction over Healdsburg’s waste

treatment pond. River Watch contended that the pond

was itself a “water of the United States” due to its

proximity to the Russian River and the underflow of

water from the pit, through the surrounding aquifer,

some of which reaches the river.

While the action was pending, River Watch

requested a formal jurisdictional determination from

the Corps. The move appeared to backfire, however,

when the Corps concluded the Basalt Pond was not a

jurisdictional water body. (Appendix D) Consistent

with its national policy of declining to assert

jurisdiction over gravel pits being reclaimed, the Corps

concluded that the Basalt Pond was not yet subject to

the Corps’ CWA jurisdiction. (Appendix D)

Although the Corps’ jurisdictional determination

was adverse to River Watch, it was never directly

challenged by River Watch. Instead, River Watch

returned to its pending litigation and, after a four-day

bench trial in December 2003, the District Court

issued an opinion finding that the gravel pit is a

“water of the United States” and subject to the CWA’s

permitting requirements. The District Court held that

“Basalt Pond and its wetlands are ‘adjacent’ to the

Russian River within the meaning of the [adjacent

wetland] regulation.” (Appendix B, p. 42a) The

District Court also held that the vast aquifer

underlying the entire alluvial valley is “a slow moving

tributary of the river.” (Appendix B, p. 26a) According

to the District Court, the Basalt Pond gravel pit is

simply “an open way station of the underground

tributary.” (Appendix B, p. 26a)

On appeal, the Court of Appeals for the Ninth

Circuit first issued an opinion on August 10, 2006.

Healdsburg petitioned for rehearing by the panel and

en banc. River Watch, and late-entrant United States,

filed motions for reconsideration and clarification.

Without hearing, the Ninth Circuit panel issued a

superseding opinion on August 6, 2007.

First, the Ninth Circuit determined that the waste

treatment pond and its surrounding underground

aquifer “qualify as wetlands under the regulatory

definition,” a decision that was based on a misreading

of the pertinent regulation. (Appendix A, p. 8a) The

Ninth Circuit selectively relied on just part of the

Corps’ definition of “wetlands” — “those areas that are

inundated or saturated by surface or groundwater” —

and disregarded the remainder of the regulation that

defines wetlands as having “a prevalence of vegetation

typically adapted for life in saturated soil conditions.”

33 C.F.R. § 328.3(b). By this bowdlerization of the

regulation, the Ninth Circuit equated aquifers and

wetlands: “The record here reflects that the Russian

River and surrounding area, including the Pond itself,

rest on top of a vast gravel bed extending as much as

sixty feet into the earth. The gravel bed is a porous

medium, saturated with water. Through it flows an

equally vast underground aquifer. ... The Basalt

Pond and its surrounding area are therefore regulable

under the Clean Water Act, because they qualify as

wetlands under the regulatory definition.” (Appendix

A, p. 8a) The Ninth Circuit concluded that the waste

treatment pond and its surrounding area are

“regulable under the Clean Water Act” simply because

they rest on a saturated aquifer. (Appendix A, p. 8a)

Nowhere in the opinion does the Ninth Circuit even

acknowledge that an aquifer is not a “swamp, marsh or

bog” and does not have “a prevalence of vegetation

typically adapted for life in saturated soil conditions.”

Although extensively briefed, the Ninth Circuit did not

even discuss the legislative history of the CWA that

makes it clear that Congress did not intend CWA

jurisdiction to extend to discharges into groundwater.

Second, the Ninth Circuit adopted as_ the

“controlling” rule of law Justice Kennedy’s concurrence

in Rapanos v. United States, 126 S.Ct. 2208 (2006),

even though no other Justice joined that concurrence.

The Ninth Circuit wrote that in “a 4-4-1 decision, the

controlling opinion is that of Justice Kennedy who said

that to qualify as a regulable water under the CWA

the body of water itself need not be continuously

flowing, but that there must be a ‘significant nexus’ to

a waterway that is in fact navigable.” (Appendix A, p.

3a) The Ninth Circuit concluded that Justice

Kennedy’s “concurrence is the narrowest ground to

which a majority of the Justices would assent if forced

to choose in almost all cases,” even though he

concurred only in the judgment and not in the

plurality’s rationale, or even in an included subset of

that rationale. (Appendix A, p. 12a) The Ninth Circuit

does not explain how it derives a rule of law from

speculating what the Justices of this Court would do

“in almost all cases” and “if forced to choose.”

(Appendix A, p. 12a)

Third, unlike other circuits that have remanded

cases in light of Rapanos, the Ninth Circuit purported

to apply Justice Kennedy’s “significant nexus” test by

reinterpreting findings made by the District Court

without the benefit of this Court’s Rapanos opinion.

The Ninth Circuit determined that the treatment pond

falls within the EPA’s and Corps’ definition of

“adjacent wetland” because it is part of a “larger”

wetland: “The Pond is part of a larger wetland that is

‘adjacent’ to the River within the meaning of Riverside

Bayview Homes. There is also a ‘substantial nexus’

present under the analysis of Justice Kennedy in

Rapanos.” (Appendix A, p. 14a) This “larger wetland”

theory of jurisdiction over an “adjacent” waterbody has

no basis in the regulations adopted by the Corps and

the EPA and, in fact, disregards the Corps’ expertise

and scientific approach to wetlands delineation.

Fourth, the Ninth Circuit found that the pond “may

be part of a waste treatment system” but refused to

apply the “waste treatment system” exception set forth

in the regulations on the basis of a rationale that does

not appear in the regulation: “Basalt Pond may be

part of a waste treatment system, but it does not fall

under the exemption because it is neither a self-

contained pond nor is it incorporated in an NPDES

permit as part of a treatment system.” (Appendix A,

p. 18a) Neither the “self-contained” nor the NPDES

permit requirements appear in the regulation.

Last, in direct contradiction of the Corps’ policy, the

Ninth Circuit refused to apply the Corps’ “excavation

operation” exception on the rationale that it applies

only to extraction, not reclamation: “The excavation

operation exemption applies only to ponds undergoing

actual extraction.” (Appendix A, p. 19a) The Ninth

Circuit failed to even mention, much less defer to,

Corps’ policy stating that CWA jurisdiction does not

extend to areas being reclaimed.

REASONS FOR GRANTING THE

WRIT OF CERTIORARI

THIS COURT SHOULD GRANT THE WRIT OF

CERTIORARI TO RESOLVE A CONFLICT AMONG THE

CIRCUITS ABOUT WHETHER THE CLEAN WATER

ACT APPLIES TO DISCHARGES INTO GROUNDWATER

The Ninth Circuit is in clear conflict with other

circuits on the issue of whether CWA jurisdiction

extends to discharges to groundwater. Contrary to

other circuits, the Ninth Circuit has extended CWA

jurisdiction to discharges into groundwater, invading

state authority in this area and ignoring well-

established Congressional intent.

The Ninth Circuit determined that the waste

treatment pond and its surrounding area “qualify as

wetlands under the regulatory definition” because they

rest on a “sa‘:rated” aquifer and so are “regulable

under the Cle... Water Act.” (Appendix A, pp. 7a-9a)

The Ninth Circuit thus equated adjacent wetlands

(which fall within the CWA under EPA and Corps’

regulations and this Court’s precedent) and

groundwater aquifers (which are outside the CWA

under the legislative history, the regulations, and long-

standing precedent). In effect, the Ninth Circuit

invented a new definition of “waters of the United

States” and added a new twist on the definition of

“adjacent wetlands.” According to the Ninth Circuit,

ponds — even man-made ponds — that seep into

groundwater aquifers are “waters of the United

States” because aquifers, being saturated soil, are

subterranean “adjacent wetlands” and thus “waters of

the United States.”

One significant flaw in the Ninth Circuit’s rule is

that Congress did not intend the CWA to extend to

discharges into groundwater. Neither the EPA nor the

Corps have adopted regulations extending jurisdiction

to groundwater. Other circuits have recognized this

limitation on CWA jurisdiction, and the Ninth Circuit’s

rule is now in conflict with those other circuits.

Until now, the two Circuits that had considered the

issue agreed that Congress did not intend the CWA to

regulate discharges into groundwater. A third Circuit

has deferred to the Corps’ expertise to reach the same

result.

In Exxon Corporation v. Train, 554 F.2d 1310, 1329

(5th Cir. 1977), the Fifth Circuit concluded “the

legislative history demonstrates conclusively that

Congress believed it was not’ granting the

Administrator [of the EPA] any power to control

disposal into groundwater.” Jd. at 1329 (emphasis in

original). Rather, Congressional intent was to leave

control of discharges to groundwater to the states:

[W]e have examined the structure of the Act

and its legislative history in an attempt to

discern the congressional intent with regard to

the question here. What we have found belies

an intention to impose direct federal control

over any phase of pollution of subsurface

waters. Instead, the congressional plan was to

leave control over subsurface pollution to the

states until further studies, provided for in the

Act, determined the extent of the problem and

possible methods for dealing with it. In our

view, the evidence is so strong that Congress

did not mean to substitute federal authority

over groundwaters for state authority that the

Administrator's construction, although not

unreasonable on its face, must give way because

“it is contrary to congressional intentions.”

Id. at 1322 (quoting EPA v. State Water Resources

Control Board, 426 U.S. 200, 227 (1976)). Referring to

the Senate committee considering the draft Clean

Water Act, the Fifth Circuit found that “as we read the

Senate report, the committee did not intend to

interfere with or displace the ‘complex and varied’

state jurisdictions over groundwaters. Rather, it

meant only to help provide the states with the

information needed to operate their own groundwater

pollution control programs, the establishment of which

§ 402(b)(1)(D) was designed to encourage.” Id. at 1326.

The Fifth Circuit has also considered whether an

impact on surface waters via a groundwater “conduit”

is sufficient to establish federal CWA jurisdiction,

again holding it is not. In Rice v. Harken Exploration

Co., 250 F.3d 264, 269 (5th Cir. 2001), the Plaintiff

claimed that “Harken’s discharges {of hydrocarbons

and brine] have seeped through the ground into

groundwater which has, in turn, contaminated several

bodies of surface water.” Jd. at 270. Despite this

alleged adverse impact on surface waters, the Rice

court held:

“Navigable waters” do not include groundwater.

It would be an unwarranted expansion .. . to

conclude that a discharge onto dry land, some of

which eventually reaches groundwater and

some of the latter of which still later may reach

navigable waters, all by gradual, natural

seepage, is the equivalent of a “discharge” “into

or upon the navigable waters.” ... In light of

Congress’s decision not to regulate ground

waters under the CWA/OPA, we are reluctant to

construe the OPA in such a way as to apply to

discharges onto land, with seepage into

groundwater, that have only an_ indirect,

remote, and attenuated connection with an

identifiable body of “navigable waters.”

Id. at 271-72.

Similarly, the Seventh Circuit, in Village of

Oconomowoc Lake v. Dayton Hudson Corp., 24 F.3d

962 (7th Cir. 1994), cert. denied, 513 U.S. 930 (1994),

rejected the notion that a man-made pond was subject

to the Clean Water Act solely because water in it

percolated into the groundwater which ultimately

traveled to local lakes and streams:

What of the possibility that water from the pond

will enter the local ground waters, and thence

underground aquifers that feed lakes and

streams that are part of the “waters of the

United States”? ... Neither the Clean Water

Act nor the EPA's definition asserts authority

over ground waters, just because these may be

hydrologically connected with surface waters.

The omission of ground waters from the

regulations is not an oversight. Members of

Congress have proposed adding ground waters

to the scope of the Clean Water Act, but these

proposals have been defeated, and the EPA

evidently has decided not to wade in on its own.

Id. at 965.

Reaching the same conclusion by a slightly

different route, the First Circuit has also concluded

that groundwater is not a “water of the United States”:

Although this definition does not indicate

whether groundwater constitutes “waters of the

United States,” the Corps has interpreted this

definition to refer only to surface waters. This

interpretation has been upheld by some courts.

Exxon Corp. v. Train, 554 F.2d 1310, 1329 (5th

Cir. 1977); Kelley v. United States, 618 F.Supp.

1103, 1105 (W.D. Mich. 1985); United States v.

GAF Corp., 389 F.Supp. 1379, 1383 (S.D. Tex.

1975). Although other courts have questioned

whether the term “waters of the United States”

should include groundwaters connected to

surface waters -- Inland Steel Co. v. E.P.A., 901

F.2d 1419, 1422 (7th Cir. 1990); McClellan

Ecological Seepage v. Weinberger, 707 F.Supp.

1182, 1193-94 (E.D. Cal. 1988) -- we agree with

the Corps that since such a determination

ultimately involves an ccological judgment

about the relationship between surface waters

and groundwaters, it should be left in the first

instance to the discretion of the EPA and the

Corps. Cf. United States v. Riverside Bayview

Homes, Inc., 474 U.S. 121, 134, 106 S.Ct. 455,

463, 88 L.Ed.2d 419 (1985) (deference should be

given to “the Corps’ ecological judgment about

the relationship between waters and their

adjacent wetlands”).

Town of Norfolk v. U.S. Army Corps of Engineers, 968

F.2d 1438, 1450-51 (1st Cir. 1992).

The Ninth Circuit sidestepped the well-reasoned

authority of these three different Circuits, disregarded

Congressional intent and administrative expertise,

and adopted the conflicting view that a groundwater

aquifer is regulable as an adjacent wetland and is

therefore, a “water of the United States.” This conflict

must be resolved.

Il.

THIS COURT SHOULD GRANT THE WRIT OF

CERTIORARI TO REVIEW THE NINTH CIRCUIT’S

FAILURE TO EVEN ACKNOWLEDGE, LET ALONE

GIVE DEFERENCE TO, THE EXPERT AGENCY’S

DETERMINATION THAT BASALT POND IS COVERED

BY THE EXCAVATION OPERATION EXCEPTION

Under the Corps of Engineer’s policy, water-filled

pits resulting from gravel excavations are not deemed

“waters of the United States” until the “excavation

operation is abandoned.” 51 Fed Reg. 41206, 41217

(1986).

Even as it acknowledged this rule, the Ninth

Circuit ignored the Corps’ interpretation of its own

rule, holding that “excavation” of these pits is

inconsistent with “reclamation” of them, so that

federal CWA jurisdiction over water-filled gravel pits

inures the moment gravel extraction ceases and

reclamation of the pit begins. In establishing this new

rule of law, the Ninth Circuit ignored the Corps’

national policy formulated under the environmentally-

sensitive Clinton/Gore administration that, to

encourage pit reclamation, these pits do not fall under

CWA jurisdiction until reclamation is complete. By

refusing to give deference to, or even mention, the

Corps of Engineers’ interpretation of the “excavation

operation exception,” the Ninth Circuit violated

established principles of judicial review of agency

action long recognized by this Court.

As interpreted by the Corps in the preamble to its

regulation defining the term “waters of the United

States,” that term does not include “pits excavated in

dry land for the purpose of obtaining fill, sand or

gravel unless and until the construction or excavation

operation is abandoned.” 51 Fed. Reg. 41206, 41217

(1986). The Corps in a series of Federal Register

notices has consistently taken the position that the

excavation operation exemption includes processing

and reclamation. See 65 Fed. Reg. 12860 (March 9,

2000) (final notice of nationwide permits, stating that

“liJn most cases, a mining site where no construction,

mining, excavation, processing, and/or reclamation

activities have occurred during the last 10 years would

be considered abandoned, at the district engineer’s

discretion.”) (emphasis added); 64 Fed. Reg. 39252,

39335 (July 21, 1999) (notice of proposed nationwide

permits, noting that the excavation operation

exception “clearly requires that the mining activity

must have stopped, and the reclamation completed,

before the area can be considered a water of the United

States”; emphasis added).

It is undisputed that the “Basalt Pond” gravel

mining pit is undergoing reclamation, and so it is not.

abandoned under the Corps’ interpretation of its own

regulations. Therefore, under the interprctation of the

agency with primary jurisdiction, the gravel pit being

used as a waste treatment pond is not a “water of the

United States.” Indeed, the Corps issued a formal

letter disclaiming CWA jurisdiction over the Pond on

the grounds that the Pond has been in continuous

commercial use and was undergoing reclamation as

part of the ongoing gravel mining operation.

(Appendix ID.) This disclaimer was never dircctly

challenged by River Watch.

Nonetheless, and in direct contradiction of the

Corps’ own interpretation, the Ninth Circuit

erroneously read the term “excavation operation” to

apply only to “extraction” and not to “reclamation.” It

therefore found that the Basalt Pond had been

“abandoned” and so is a “water of the United States.”

Indeed, the Ninth Circuit did not even acknowledge

either the Corps’ interpretation of its own policy or its

application of that policy to this specific gravel pit.

This Court has long held that deference is due to

the Corps’ interpretation of the Clean Water Act as

long as it is “reasonable and not in conflict with the

expressed intent of Congress.” United States uv.

Riverside Bayview Homes, 474 U.S. 121, 131 (1985);

see also Chevron U.S.A., Inc. v. NRDC, 467 U.S. 837,

844-45 (1984). Where, as here, “the construction of an

administrative regulation rather than a statute is in

issue, deference is even more clearly in order.” Udall

v. Tallman, 380 U.S. 1, 16 (1965). The Ninth Circuit’s

failure to give deference here is even more surprising

since in the past that court has recognized that “(t]he

agency’s interpretation of its own regulation is entitled

to even greater deference, amounting to a plain error

standard.” Leslie Salt v. United States, 896 F.2d 354,

357 (9 Cir. 1990) (granting deference to the same

preamble language at issue here), cert. dented, 408

U.S. 1126 (1991).

Indeed, a majority of this Court reaffirmed in

Rapanos that the Corps is entitled to considerable

deference in interpreting the requirements of the CWA

that it administers. Justice Kennedy reaffirmed the

statement of deference to the Corps’ construction of the

CWA as stated in Riverside Bayview. Rapanos v.

United States, 126 S.Ct. 2208, 2240 (2006) (Kennedy,

J., concurring) (citing Riverside Bayview, 474 U.S. at

131). Justice Stevens, writing for the four dissenters

in Rapanos, states that “the Corps’ approach should

command our deference.” Jd. at 2262 (Stevens, Souter,

Ginsburg & Breyer, JJ., dissenting). Likewise, Justice

Breyer in his separate dissent states that “[i]f one

thing is clear, it is that Congress intended the Army

Corps of Engineers to make the complex technical

judgments that lie at the heart of the present cases

(subject to deferential judicial review).” /d. at 2266

(Breyer, J., dissenting).

In the present matter, the Corps has made the

“complex technical judgments” that gravel mining pits

being reclaimed are not generally subject to federal

CWA jurisdiction and, specifically, that CWA

jurisdiction does not extend to the particular gravel

mining pit at issue in this case. The Ninth Circuit’s

failure to give this determination deferential judicial

review undermines established principles of review of

agency action and therefore merits this Court’s review.

III.

THIS COURT SHOULD GRANT THE WRIT OF

CERTIORARI TO REVIEW THE NINTH CIRCUIT’S

DECISION THAT IMPROPERLY EXTENDS CWA

JURISDICTION BY LABELING ADJACENT

WATERBODIES AS ADJACENT WETLANDS

The Ninth Circuit decision throws into chaos the

critical legal distinction between wetlands adjacent to

waters subject to CWA jurisdiction, and other bodies of

water, such as ponds, that are in some proximity to

jurisdictional waters. Adjacent wetlands are subject to

CWA jurisdiction if they meet the criteria of the

applicable federal regulations. By contrast, there is no

such rule for adjacent waterbodies. This is no

regulatory quirk; this Court has deferred to the Corps’

special treatment of adjacent wetlands based upon the

important environmental functions they serve. See

United States v. Riverside Bayview Homes, Inc., 474

U.S. 121, 134-35 (1985). More recently, this Court

affirmed its rationale for finding that the adjacent

wetlands in Riverside Bayview came under CWA

jurisdiction: “Congress’ concern for the protection of

water quality and aquatic ecosystems indicated its

intent to regulate wetlands ‘inseparably bound up with

the “waters” of the United States.” Solid Waste

Agency of Northern Cook County v. United States Army

Corps of Engineers (“SWANCC”), 531 U.S. 159, 167

(2001) (emphasis added). The Ninth Circuit’s decision

ignores the special status of adjacent wetlands long

recognized by this Court.

The Ninth Circuit decision selectively ignores key

regulatory definitions in order to treat Basalt Pond, an

open waterbody fringed with wetlands, as one big

“adjacent wetland” subject to CWA regulation. By

failing once again to give deference to the expert

administrative agencies, the Ninth Circuit has issued

a precedent wildly at variance with an established rule

for determining CWA jurisdiction approved by this

Court in Riverside and SWANCC. Furthermore, the

extension of CWA regulation to the entire pond rests

on the notion that the wetlands around the pond are

themselves “adjacent wetlands” subject to CWA

jurisdiction, a premise that is itself incorrect.

The Ninth Circuit decision states that because the

Pond “contains and is surrounded by wetlands,” it is

regulable under the CWA. (Appendix A, p. 9a) The

decision does not explain why wetlands surrounding or

intruding into an open body of water render the entire

waterbody an “adjacent wetland.” By contrast, an

earlier Ninth Circuit decision emphatically applied the

distinction between jurisdictional adjacent wetlands

and a non-jurisdictional adjacent pond. See San

Francisco Baykeeper v. Cargill Salt Div. , 481 F.3d 700,

704, 702 (9" Cir. 2007) (stating that that “the district

court improperly expanded the regulatory definition of

‘waters of the United States’ when it held that bodies

of water that are adjacent to navigable waters are

subject to the CWA by reason of that adjacency [|” and

that “mere adjacency provides a basis for CWA

coverage only when the relevant waterbody is a

‘wetland |].”) The instant Ninth Circuit decision

attempts to distinguish Cargill on the basis that the

pond in Cargill did not contain and was not

surrounded by wetlands. (Appendix A, p. Qa)

However, this distinction is of no importance, since it

does not explain how the presence of wetlands can

transform the rest of an open waterbody into a water

of the United States based on the regulatory definition

of “adjacent wetlands.” The Ninth Circuit decision in

this case represents a drastic change in approach from

Cargill, and extends regulation to waterbodies that

would not be regulated under Cargill, without any

legal basis whatsoever.

The Ninth Circuit decision does not even discuss,

let alone defer to, the expert agencies’ carefully drawn

distinction between waterbodies and wetlands. The

governing regulations specifically address only

adjacent wetlands, not adjacent waterbodies. See 33

C.F.R. § 328.3(a)(7) (Corps regulations); 40 C.F.R.

§ 122.2 (EPA regulations) (defining “waters of the

United States” to include “Wetlands adjacent to waters

(other than waters that are themselves wetlands).”).

Further, the regulations define wetlands in a manner

that, of necessity, excludes large open waterbodies:

“Wetlands’ are defined to mean areas that are

inundated or saturated by surface or groundwater at

a frequency and duration sufficient to support, and

that under normal circumstances do support, a

prevalence of vegetation typically adapted for life in

saturated soil conditions. Wetlands generally include

swamps, marshes, bogs, and similar areas.” Id.

(emphasis added). Indeed, there is an established

science to delineating wetlands, as distinguished from

uplands and open waters, that evaluates depth of

water, hydric vegetation and other characteristics. See

U.S. Army Corps of Engineers Wetlands Delincation

Manual, Part II (wetlands are “inundated either

permanently or periodically at mean water depths <6.6

ft”), reproduced at www.wetlands.com/regs/tlp

ge02e.htm (visited on October 29, 2007).

The regulatory distinction between waterbodies

and wetlands is applied on a routine basis by the

agencies themsclves as well as by the regulated

community. Property owners whose land contains

both wetlands and bodies of open water should be able

to rely on the long-established regulatory distinction

described above in making decisions about

commitment of resources and the use of their land.

The Ninth Circuit decision throws this certainty into

disarray, with potential deleterious effects of national

scope.

IV.

THIS COURT SHOULD GRANT THE WRIT OF

CERTIORARI TO RESOLVE WHETHER THE NINTH

CIRCUIT ADOPTED AN UNWORKABLE

INTERPRETATION OF THE WASTE

TREATMENT SYSTEM EXCEPTION

The Ninth Circuit adopted an interpretation of the

“waste treatment system” exemption that establishes

an unworkable rule of law and that conflicts with other

circuits. The exemption provides that “|wlaste

treatment systems... are not waters of the United

States.” 33 C.F.R. § 328.3(a\8). EPA has defined

“waste treatment systems” broadly, to encompass both

treatment an disposal facilities:

A complete waste treatment system consists of

all the treatment works necessary to mect the

requirements of title III of the Act, involving: (i)

The transport of wastewater from individual

homes or buildings to a plant or facility where

treatment of the wastewater is accomplished;

(ii) the treatment of the wastewater to remove

pollutants; and (iii) the ultimate disposal,

including recycling or reuse, of the treated

wastewater and residues which result from the

treatment process.

40 C.F.R. § 35.2005(12).

The Ninth Circuit did not dispute that

Healdsburg’s gravel mining pit/percolation pond was,

in fact, part of Healdsburg’s waste treatment system.

Instead, imposing entirely new conditions found

nowhere in the regulations, the Ninth Circuit ruled

that the pond “may be part of a waste treatment

system” but concluded that the pond “does not fall

under the exemption because it is neither a self-

contained pond nor is it incorporated in an NPDES

permit as part of a treatment system.” (Appendix A,

p. 18a)

The first part of the Ninth Circuit’s test is in

conflict with the First, Fifth and Seventh Circuits’

interpretation of the CWA. As discussed above,

Congress did not intend the CWA to apply to

discharges to groundwater. Yet, here, the Ninth

Circuit’s interpretation of the “waste treatment

exception” is predicated on the notion that jurisdiction

is present because the waste treatment pond is not a

“self-contained” system (i.e., not a lined evaporation

pond) but, rather, as a percolation pond, it seeps into

the surrounding groundwater. The first part of the

Ninth Circuit’s new rule is unsupported by either

agency regulation or Congressional intent.

The second part of the Ninth Circuit’s rationale,

which requires that a treatment pond be “incorporated

into {a federal] permit” is just plain unworkable. In

effect, the Ninth Circuit says that it takes a federal

permit to avoid the necessity of having that same

federal permit. Healdsburg’s situation is the perfect

example. For thirty years, Healdsburg operated its

waste treatment system under a state-issued permit

which acknowledged Healdsburg’s use of the gravel pit

as a polishing and percolation pond. Yet, because the

system did not discharge directly to a navigable

waterway and so did not need a “federal” permit until

the Ninth Circuit changed the rules, this thirty-year

old percolation pond is suddenly no longer part of

Healdsburg’s “waste treatment system.” This

rationale is circular and unworkable and leaves the

regulated community without clear standards.

Ultimately, it renders the waste treatment system

exception largely a nullity.

THIS COURT SHOULD GRANT THE WRIT OF

CERTIORARI TO DETERMINE THE CONTROLLING

RULE OF LAW FOR ADJACENT WETLANDS AND To

RESOLVE A SPLIT IN THE CIRCUITS ON THIS ISSUE

The Ninth Circuit adopted as the controlling rule of

law of Rapanos the “significant nexus” test of Justice

Kennedy’s concurrence, even though no other Justice

joined that opinion. The Ninth Circuit wrote that in

the “4-4-1 decision, the controlling opinion is that of

Justice Kennedy” because his “concurrence is the

narrowest ground to which a majority of the Justices

would assent if forced to choose in almost all cases.”

(Appendix A, pp. 3a & 12a) Not only is it an error of

law for the Ninth Circuit to conclude that Justice

Kennedy’s concurrence is “controlling,” the Circuits are

split on how to apply the fragmented Rapanos opinion.

The procedure for determining the effect of a

fragmented Supreme Court opinion is to determine the

narrowest ground of agreement among a majority of

the Justices concurring in the judgment: “When a

fragmented Court decides a case and no single

rationale explaining the result enjoys the assent of five

Justices, ‘the holding of the Court may be viewed as

that position taken by those Members who concurred

in the judgment on the narrowest grounds .. ..”

Marks v. United States, 130 U.S. 188, 193 (1977). The

narrowest ground of agreement is not necessarily

reflected in the concurring opinion. For example, in

the decision followed by Marks, Memoirs ov.

Massachusetts, 383 U.S. 413 (1966), the plurality

represented the narrowest ground of agreement.

Marks, 430 U.S. at 193-94. Accordingly, the “view of

the Memoirs plurality therefore constituted the

holding of the Court and provided the governing

standards.” Id.

Applying the Marks rule, it cannot be said that the

Rapanos plurality and Justice Kennedy agreed on

anything except that the judgment had to be vacated

and the matter remanded for further fact-finding.

There was no agreement on the rationale, and neither

the plurality’s “continuous surface connection” nor the

concurrence’s “significant nexus” tests can be said to

be a narrower subset of the other. The plurality and

the concurrence merely took different roads to the

same destination. Thus no agreed road map or rule of

law can be extracted from Justice Kennedy’s

concurrence under a Marks analysis. '

The difficulty in applying the Rapanos decision has

already caused a split in the circuits. The Seventh,

Ninth and Eleventh Circuits have adopted Justice

Kennedy’s test as controlling. See United States v.

Gerke Excavating, Inc., 464 F.3d 723, 725 (7th Cir.

' Notably, contrary to the Ninth Circuit’s reformulation of the

Marks rulc there is no “if forced to choose” analysis in Marks, nor

does the Marks rule allow for an “in almost all cases” qualifier.

These convenient modifiers to the Marks rule have no support in

this Court’s precedents.

2006) (“Justice Kennedy’s proposed standard, which

we conclude must govern the further stages of this

litigation, requires factfinding not yet undertaken by

the district court. We therefore remand the case to

that court for such further proceedings as may be

necessary to apply the standard.”), cert. denied, 552

US. --- (Oct. 1, 2007); Northern California River Watch

v. Healdsburg, (Appendix A, p. 3a) (“controlling

opinion is that of Justice Kennedy”); United States v.

Robison, Case No. 05-17019, 2007 WL 3087419, at *11

(11th Cir. Oct. 24, 2007) (“we join the Seventh and the

Ninth Circuits’ conclusion that Justice Kennedy’s

‘signiitcant nexus’ test provides the governing rule of

Rapanos,” rejecting the First Circuit’s “either/or” test

from Johnson, infra). In contrast, the First Circuit has

adopted Justice Stevens’ suggestion that either the

plurality’s test or Justice Kennedy’s test may be

applied. See Rapanos, 126 S. Ct. at 2265 (Stevens, J.,

dissenting) (“on remand each of the judgments should

be reinstated if either of those tests is met”). In United

States v. Johnson, the First Circuit wrote that on

remand, the “federal government can _ establish

jurisdiction over the target sites if it can meet either

the plurality’s or Justice Kennedy’s standard as laid

out in Rapanos.” United States v. Johnson, 467 F.3d

56, 66 (1st Cir. 2006), cert. denied, 552 U.S. --- (Oct. 9,

2007).?

“It is significant that in each of the prior cases raising this issue

to the Court, Gerke and Johnson, the Circuit Court had remanded

the matter for further fact-finding. No such remand has occurred

in this case, so this issue here is final and ripe for review.

This conflict between the Circuits has been

expressly recognized by the Eleventh Circuit. See

United States v. Robison, Case No. 05-17019, 2007 WL

3087419, at *9 (11th Cir. Oct. 24, 2007) (“The circuits

likewise are split on the question of which Rapanos

opinion provides the holding.”). Certiorari should be

granted to resolve this conflict between the Circuits

and give clarity to this important issue.

VI.

ASSUMING THAT THE “SIGNIFICANT NEXUS” TEST

APPLIES, THIS COURT SHOULD GRANT CERTIORARI

TO RESOLVE THE ISSUE OF WHETHER THERE CAN

BE A SIGNIFICANT NEXUS EVEN THOUGH THE

WETLANDS’ EFFECT ON NAVIGABLE

WATERS IS INSUBSTANTIAL

The Ninth Circuit misapplied Justice Kennedy’s

“substantial nexus” test from Rapanos without even

remanding for further fact-finding. If applied

properly, on remand, it is likely that no jurisdiction

over the treatment pond would be found under the

substantial nexus test or, indeed, under any of the

rationales expressed in the various Rapanos opinions.

For example, under the Rapanos plurality’s

analysis, which the Ninth Circuit ignores, “only those

wetlands with a continuous surface connection to

bodies that are ‘waters of the United States’ in their

own right, so that there is no clear demarcation

between ‘waters’ and wetlands, are ‘adjacent to’ such

watcrs and covered by the Act.” Rapanos, 126 S.Ct. at

2226 (Scalia, J., joined by Roberts, C.J., Thomas, Alito,

J.J.) (emphasis in original). CWA jurisdiction would

not reach the gravel pit/treatment pond under this rule

because there is no “continuous surface connection”

between the gravel pit and the Russian River, and the

gravel pit and the Russian River are clearly

demarcated by natural uplands.

Under four Justices’ dissenting view, which the

Ninth Circuit also ignores, “the Corps’ approach should

command our deference.” Jd. at 2262 (Stevens, J.,

joined by Souter, Ginsburg & Breyer, J.J., dissenting).

Under this rationale, there would be no CWA

jurisdiction here because, consistent with its published

policy, the Corps disclaimed jurisdiction over the

gravel pit/treatment pond, a decision entitled to

deference.

Even under Justice Kennedy’s analysis, if applied

correctly, the treatment pond would not be an

“adjacent” wetland because there was no evidence that

its wetlands, or even the gravel pit/treatment pond

itself, has more than a speculative or insubstantial

effect on water quality in the Russian River.

To reach its conclusion, the Ninth Circuit ignored

Justice Kennedy’s critical admonition that to be

jurisdictional the wetlands must “significantly affect

the chemical, physical, and biological integrity” of

navigable-in-fact waters and that jurisdiction fails

when “wetlands’ effects on water quality are

speculative or insubstantial”:

Accordingly, wetlands possess the requisite

nexus, and thus come within the statutory

phrase “navigable waters,” if the wetlands,

either alone or in combination with similarly

situated lands in the region, significantly affect

the chemical, physical, and biological integrity

of other covered waters more readily understood

as “navigable.” When, in contrast, wetlands'

effects on water quality are speculative or

insubstantial, they fall outside the zone fairly

encompassed by the statutory term “navigable

waters.”

Rapanos, 1268.Ct. at 2248 (Kennedy, J., concurring in

the judgment of remand).*

* The Ninth Circuit also implied that under Justice Kennedy’s

concurrence in Rapanos, any wetlands in proximity to a

traditionally navigable water — such as those ringing Basalt Pond

~ are “adjacent wetlands” subject to CWA jurisdiction “by showing

adjacency alone.” (Appendix A, p. 14a (quoting Rapanos, 12658.Ct.

at 2248, Kennedy, J., concurring)). This, again, is a misreading of

Justice Kennedy’s concurrence. Justice Kennedy’s statement

quoted by the Ninth Circuit referred to wetlands like those in

Riverside Bayview Homes that directly abut traditionally

navigable waters. See 126 S.Ct. at 2248 (characterizing the

“adjacency alone” formulation as the holding in Riverside

Bayview). In Riverside Bayview Homes, “the lands at issue formed

part of a wetland that directly abutted a navigable-in-fact creek|].”

Rapanos, 126 S.Ct. at 2240 (Kennedy, J., concurring) citing

Riverside Bayview Homes, 474 U.S. at 131. By contrast, the

gravel pit and its reclamation wetlands are separated from the

Russian River by natural uplands. Neither the Kennedy

concurrence in Rapanos nor Riverside Bayview Homes holds that

a wetland that does not abut a navigable water, but instead is

separated from the navigable waterway by natural uplands, is

subject to CWA jurisdiction by virtue of mere proximity alone.

The Ninth Circuit made at least two critical

mistakes in applying the significant nexus test. First,

as explained in parts I and III above, the Ninth Circuit

conjured up a “larger wetland” made up of the

wetlands that fringe the pond, the pond itself, and the

underground aquifer that underlies the pond.

(Appendix A, pp. 7a-9a, 14a) The next step in the

Ninth Circuit’s analysis was to conclude that this

“larger wetland” is “adjacent to” the Russian River,

and has a significant nexus to the River, thereby

rendering the pond regulable under the CWA.

(Appendix A, p. 14a) However, the only wetlands

involved in this case are those that border the gravel

pit, and there is no evidence that those wetlands, as

distinct from the gravel pit’s filtering silt lining,

“significantly affect” the water quality of the Russian

River. Under Justice Kennedy’s analysis, the wetlands

that now ring the gravel pit would not be “adjacent”

wetlands because they have no more than a

speculative or insubstantial effect on water quality in

the Russian River. This first mistake alone is reason

to grant certiorari.

Second, the Ninth Circuit even misapplicd the

substantial nexus test to the “larger wetlands” by

deciding that the pit, its wetlands, and the

underground aquifer, taken as a whole, had an effect

on the river that rises to the level of significant nexus.

(Appendix A, pp. 14a-16a) In other words, even

assuming arguendo that the “larger wetland” exists,

the Ninth Circuit misapplied Justice Kennedy’s test.

This is not just a question of disputing the Court of

Appeals’ view of the evidence; the Ninth Circuit

decision squarely raises the all-important legal issue

of what degree of impact on navigable waters is needed

in order to meet the significant nexus test. In effect,

the Ninth Circuit found that any effect qualifies, even

if only theoretical and indiscernible. This is a radical

interpretation that reads the term “significant” right

out of the test, and has potentially enormous

implications nationwide.

Rather than remanding the matter, the Ninth

Circuit revamped the District Court’s findings to apply

the new “substantial nexus” test in the first instance

on appeal. First, the Court held that the gravel pit

was a part of a “large wetland” (i.e., the underground

aquifer) which was itself “adjacent” to the Russian

River. (Appendix A, pp. 14a & 20a) Second, the Court

concluded that the water in the gravel pit had

“connection” to the Russian River both as a result of

occasional flooding of the pit by the river and due to

underflow through the aquifer from the pit to the

river. (Appendix A, p. 15a) Third, the Court noted that

birds and animals may travel from the pit to the river

and back, and that fish found in the river also live in

the 68-acre gravel pit. (Appendix A, p. 15a) Finally,

the Court reinterpreted the District Court’s finding

that “excessive amounts of chloride” (emphasis added)

reach the river from the pit (Appendix B, p. 48a) to

conclude there was a significant effect on the water in

the river. (Appendix A, pp. 15a & 16a) Nowhere in the

District Court’s opinion did the District Court find that

any of these factors had a significant effect on the

water in the river, the sine qua non of the “substantial

nexus” test. On the contrary, as the District Court

noted, as soon as any salt reaches the river, it is then

“greatly diluted by the river.” (Appendix B, p. 48a.)

The District Court does not make the finding

attributed to it by the Ninth Circuit that the underflow

from the gravel pit in fact significantly affects the

water in the river.

As Justice Kennedy stated, “When . . . wetlands’

effects on water quality are speculative or

insubstantial, they fall outside the zone fairly

encompassed by the statutory term “navigable waters”

Rapanos, 1268.Ct. at 2248 (Kennedy, J., concurring in

the judgment of remand). The only evidence before

the District Court regarding impact on the navigable-

in-fact waterway, the Russian River, was that the

amount of salt transmitted through the aquifer to the

river was indiscernible in comparison to the naturally-

occurring salt in the river. Under Justice Kennedy’s

analysis, any effect of the gravel pit on the water

quality of the river could only be deemed

“insubstantial.”

The Ninth Circuit’s expansive reading of the

significant nexus test runs counter to Justice

Kennedy’s own explication of the test, and has the

potential to expand tremendously the number of

waters subject to regulation under the CWA. Even

assuming that Justice Kennedy’s test controls, this

Court should grant certiorari to correct a serious

misreading of that formulation.

CONCLUSION

The Ninth Circuit’s opinion in this matter should

not be allowed to stand because it vastly expands CWA

jurisdiction, conflicts with Congressional intent and

other circuits by imposing CWA jurisdiction to

groundwater aquifers, violates regulatory intent by

defining a waterbody as a wetland, fails to defer to the

established policy and specific determination of the

Corps of Engineers, proposes an unworkable

interpretation of the waste treatment system

exception, and ignores and misapplies the Rapanos

opinions.

Dated: November, 2007

Respectfully submitted,

Peter W. McGaw

Counsel of Record

Archer Norris

2033 North Main Street, Suite 800

Walnut Creek, CA 94596

Telephone: (925) 930-6600

Facsimile: (925) 930-6620

Counsel for Petitioner

APPENDIX

APPENDIX A

UNITED STATES COURT OF APPEALS

FOR THE NINTH CIRCUIT

No. 04-15442

[Filed August 6, 2007]

NORTHERN CALIFORNIA RIVER WATCH,

a non-profit corporation,

Plaintiff-Appellee,

Vv.

CITY OF HEALDSBURG,

and Does 1-10 inclusive.

Defendant-Appellant.

a a A a ee ee ee

Before: Mary M. Schroeder, Chief Judge, Jerome

Farris and Consuelo M. Callahan, Circuit Judges.

Appeal from the United States District Court

for the Northern District of California

William H. Alsup, District Judge, Presiding

D.C. No. CV-01-04686-WHA

ORDER

The opinion filed August 10, 2006, slip op. 9299,

and appearing at 457 F.3d 1023 (9th Cir. 2006) is

withdrawn, and a new opinion will be filed in its stead.

The Petitions for Rehearing and Rehearing En

Banc are otherwise DENIED, no further petitions for

rehearing will be accepted.

OPINION

SCHROEDER, Chief Judge:

Defendant/Appellant City of Healdsburg

(“Healdsburg”) appeals the district court’s judgment in

favor of Plaintiff/Appellee Northern California River

Watch (“River Watch”), an environmental group, in

this litigation under the Clean Water Act (“CWA”).

Plaintiff alleges that Healdsburg, without first

obtaining a National Pollutant Discharge Elimination

System (“NPDES”) permit, violated the CWA by

discharging sewage from its waste treatment plant

into waters covered by the Act. Healdsburg discharged

the sewage into a body of water known as “Basalt

Pond,” a rock quarry pit that had filled with water

from the surrounding aquifer, located next to the

Russian River.

The issue is whether Basalt Pond is subject to the

CWA because the Pond, containing wetlands, borders

additional wetlands that are adjacent to a navigable

river of the United States. The district court held that

discharges into the Pond are discharges into the

Russian River, a navigable water of the United States

protected by the CWA. The court followed the United

States Supreme Court decision in United States v.

Riverside Bayview Homes, Inc., 474 U.S. 121 (1985).

The Supreme Court, however, has now narrowed

the scope of that decision. See Rapanos v. United

States, 126 S.Ct. 2208 (2006). In a 4-4-1 decision, the

controlling opinion is that of Justice Kennedy who said

that to qualify as a regulable water under the CWA

the body of water itself need not be continuously

flowing, but that there must be a “significant nexus” to

a waterway that is in fact navigable.

In light of Rapanos, we conclude that Basalt Pond

possesses such a “significant nexus” to waters that are

navigable in fact, not only because the Pond waters

seep into the navigable Russian River, but also

because they significantly affect the physical,

biological, and chemical integrity of the River. We

affirm the district court’s holding that Basalt Pond is

subject to the CWA. We also affirm the district court’s

ruling that neither the waste treatment system nor the

excavation operation exceptions in the Act apply to

Healdsburg’s discharges.

BACKGROUND

The Clean Water Act of 1972 provides the

foundation for this case. See 33 U.S.C. § 1251. The

primary objective of the CWA is to “restore and

maintain the chemical, physical and_ biological

integrity of the Nation’s waters.” 33 U.S.C. § 1251(a).

To effectuate this objective, one of the CWA’s principal

sections strictly prohibits discharges of pollutants into

the “navigable waters of the United States” without an

NPDES permit from the Environmental Protection

Agency (“EPA”). 33 U.S.C. § 1311(a). The CWA defines

the term “navigable waters” to mean “waters of the

United States, including the territorial seas.” 33

U.S.C. § 1362(7).

Basalt Pond was created in approximately 1967

when the Basalt Rock Company began excavating

gravel and sand from land near the Russian River.

After the top soil was ripped away, large machines tore

out rock and sand. The result was a pit. The pit filled

with water up to the line of the water table of the

surrounding aquifer. Today, Basalt Pond, measuring

one half mile in length and a quarter mile in breadth,

contains 58 acres of surface water. The Pond lies along

the west side of the Russian River, separated from the

River by wetlands and a levec.

It is undisputed that the Russian River is a

navigable water of the United States. Its headwaters

originate in Mendocino County, California. Its main

course runs about 110 miles, flowing into the Pacific

Ocean west of Santa Rosa.

The horizontal distance between the edge of the

River and the edge of the Pond varies between 50 and

several hundred feet, depending on the exact location

and the height of the river water. Usually, there is no

surface connection, because the levee blocks it and

prevents the Pond from being inundated by high river

waters in the rainy season.

In 1971, Healdsburg built a _ secondary

waste-treatment plant on a 35-acre site located on the

north side of Basalt Pond about 800 feet from and west

iat cieai catia inlet inal

of the Russian River. Prior to 1978, Healdsburg

discharged the plant’s wastewater into another

water-filled pit located to the north. In 1978,

Healdsburg began discharging into Basalt Pond.

Although Healdsburg did not obtain an NPDES

permit, it received a state water emission permit as

well as permission from Syar Industries, Inc., the

current owner and manager of land and operations at

Basalt Pond.

The wastewater was discharged into Basalt Pond

from the plant at about 420 to 455 million gailons per

year between 1998 and 2000. The volume of the Pond

itself is somewhat larger — 450 to 740 million gallons.

The annual outflow from the sewage plant, therefore,

is sufficient to fill the entire Pond every one to two

years. Basalt Pond would, of course, soon overflow in

these circumstances were it not for the fact that the

Pond drains into the surrounding aquifer.

Pond water in the aquifer finds its way to the River

over a period of a few months and seeps into the River

along as much as 2200 feet of its banks. The district

court made specific findings as to the impact of the

wastewater ultimately draining into the Russian

River. First, the district court noted that not all the

sewage in the wastewater reached the River. The

wastewater is partially cleansed as it passes through

the bottom and sides of the Basalt Pond. Healdsburg

refers to this process as “polishing” or “percolation.”

The wetlands around Basalt Pond also help cleanse

the outflow by passing the effluent through the

wetlands sediment. The filtration is effective in

reducing biochemical oxygen demand and removing

some pollutants, but the filtration is not perfect.

The district court found that the concentrations of

chloride in the groundwater between the Pond and the

Russian River are substantially higher than in the

surrounding area. Chloride, which already exists in

the Pond due to naturally occurring salts, reaches the

River in higher concentrations as a direct result of

Healdsburg’s discharge of sewage into the Pond. Mr.

John Lambie, a water expert for Healdsburg, testified

at trial that the average concentration of chloride

appearing upstream in the River is only 5.9 parts per

million. In contrast, the average concentration of

chloride seeping from Basalt Pond into the River is 36

parts per million. At a monitoring well between the

Pond and the River, the underground concentration is

diluted to some 30 parts per million. Ultimately, a

chloride concentration of 18 parts per million appears

on the west side of the River. The district court thus

found that chloride from the Pond over time makes its

way to the River in higher concentrations than

naturally occurring in the River. This finding was

further supported by Dr. Larry Russell, one of River

Watch’s trial experts.

Plaintiffs filed this suit on December 4, 2001,

alleging that Healdsburg is violating the CWA by

discharging wastewater into Basalt Pond. After a four

day trial, the district court made findings of fact to

support its holding that Healdsburg discharged sewage

into a protected water of the United States in violation

of the CWA. The court’s holding was premised on the

legal conclusion that Basalt Pond is a “water of the

United States” within the meaning of the CWA. See

2004 WL 201502 (N.D. Cal.). This appeal followed.

DISCUSSION

A. Wetlands Constituting Waters of the United States

{1] Congress passed the Clean Water Act in 1972.

The Act’s stated objective is “to restore and maintain

the chemical, physical, and biological integrity of the

Nation’s waters.” § 33 U.S.C. § 1251(a). To that end,

the statute, among other things, prohibits “the

discharge of any pollutant by any person” except as

provided in the Act. § 1311(a).

{2] After the CWA was passed, an issue arose

concerning the extent to which wetlands adjacent to

navigable waters constitute “waters of the United

States.” In 1978, the Army Corps of Engineers

(“ACOE”) issued regulations defining “waters of the

United States” to include “adjacent wetlands.” 33

C.F.R. § 328.3(a)(7). The regulations specifically

provide that “[t]he term ‘waters of the United States’

means,” among other things, “[wJetlands adjacent to

waters.” Id. The regulations further specify that

“[wletlands separated from other waters of the United

States by man-made dikes or barriers, natural river

berms, beach dunes and the like are ‘adjacent

wetlands.’ “ 33 C.F.R. § 328.3(c).

The Supreme Court has since confirmed that

regulable waters of the United States include

tributaries of traditionally navigable waters and

wetlands adjacent to navigable waters and their

tributaries. Riverside Bayview Homes, 474 U.S. 121;33

C.F.R. 328.3(a)(1),(4),(7). The only question reserved in

Riverside Bayview Homes was the issue of CWA

jurisdiction over truly isolated waters. See Rapanos,

126 S.Ct. at 2255 n.3.

Thus, the first issue before us is whether Basalt

Pond and the wetlands in it are isolated waters, or

whether they constitute covered wetlands within the

meaning of the regulations and within the scope of

Riverside Bayview Homes and Rapanos.

[3] The applicable regulations define wetlands as

“those areas that are inundated or saturated by

surface or groundwater.” See 33 C.F.R. § 328.3(b). The

record here reflects that the Russian River and

surrounding area, including the Pond itself, rest on top

of a vast gravel bed extending as much as sixty feet

into the earth. The gravel bed is a porous medium,

saturated with water. Through it flows an equally vast

underground aquifer. This aquifer supplies the

principal pathway for a continuous passage of water

between Basalt Pond and the Russian River. Beneath

the surface, water soaks in and out of the Pond via the

underground aquifer. This action is continuous, 24

hours a day, seven days a week, 365 days a year.

Indeed, the parties have stipulated that the Pond and

the River overlie the same unconfined aquifer and that

the land separating the two is saturated below the

water table.

[4] The Basalt Pond and its surrounding area are

therefore regulable under the Clean Water Act,

because they qualify as wetlands under the regulatory

definition. The district court explicitly found that the

Pond is not only surrounded by extensive wetlands,

which connect to the Russian River, but also that the

Pond’s shoreline has receded so substantially that

much of the area that was originally Basalt Pond has

turned into wetland. This case is thus different than

our recent decision in San Francisco Baykeeper uv.

Cargill Salt Div., 481 F.3d 700 (9th Cir. 2007), because

here, the Pond is not isolated; it contains and is

surrounded by wetlands, rendering it regulable under

the CWA.

The remaining question is whether, under Rapanos

and its antecedents, Basalt Pond is a “water of the

United States” because it is sufficiently adjacent to the

navigable Russian River to confer jurisdiction or

alternatively because it has a substantial nexus to the

River.

The Supreme Court has not yet agreed upon a

satisfactory explanation of when wetlands are

sufficiently adjacent to navigable waters to confer

CWA jurisdiction. The leading case addressing the

issue is Riverside Bayview Homes, 474 U.S. 121, which

was decided in 1985. The Supreme Court there upheld

CWA jurisdiction over wetlands that directly abutted

a navigable creek. The Court held that “the

relationship between waters and their adjacent

wetlands provides an adequate basis for a legal

judgment that adjacent wetlands may be defined as

waters under the Act.” Jd. at 134.

15] In Solid Waste Agency of Northern Cook County

v. United States Army Corps of Engineers, 531 U.S.

159 (2001) (SWANCC), the Supreme Court again

interpreted the CWA term “navigable waters” and held

that isolated ponds and mudflats, unconnected to other

waters covered by the Act, were not “waters of the

United States, because they were cither not

10a

sufficiently adjacent to navigable waterways or did not

have a substantial nexus to such waters.” The case

involved ponds that had been formed as a result of an

abandoned sand and gravel pit mining operation, but

were not “adjacent wetlands.” The ACOE regulations

defined the ponds nevertheless to be “waters of the

United States,” because they were “used as habitat by

other migratory birds which cross state lines.” 40

C.F.R. § 328.3(a)(3)(b). Under this “Migratory Bird

Rule,” ponds that are isolated from navigable waters

may constitute “waters of the United States” if they

are used as habitat by migratory birds. The Supreme

Court rejected that theory and held that the CWA does

not protect isolated ponds without a significant nexus

to navigable water. The Court explained that, “lilt was

the significant nexus between wetlands and ‘navigable

waters’ that informed our reading of the [Act] in

Riverside Bayview Homes.” Id. at 167.

The Supreme Court in SWANCC, therefore,

invalidated the Migratory Bird Rule but did not

purport to reconsider its prior holding regarding

adjacent wetlands in Riverside Bayview Homes. In

Baccarat Fremont Developers, LLC v. U.S. Army Corps

of Engineers, 425 F.3d 1150 (9th Cir. 2005), we

expressly recognized that SWANCC invalidated the

ACOE’s Migratory Bird Rule, but did not overrule

Riverside Bayview Homes. Our conclusion in Baccarat

is consistent with other circuits that have also held

that SWANCC did not overrule Riverside Bayview

Homes. See United States v. Hubenka, 438 F.3d 1026

(10th Cir. 2006); United States v. Johnson, 437 F.3d

157 (1st Cir. 2006).

lla

In the last term the Supreme Court also discussed

the intersection between Riverside Bayview Homes and

SWANCC. Rapanos, 126 S.Ct. 2208. The Rapanos

decision involved two consolidated cases, United States

v. Rapanos, 376 F.3d 629 (6th Cir. 2004) (Rapanos J),

and Carabell v. U.S. Army Corps of Engineers, 391

F.3d 704 (6th Cir. 2004).

The first consolidated case, Rapanos I, involved

three land parcels near Midland, Michigan. The first

parcel, known as the Salzburg site, consisted of

roughly 230 acres. The Salzburg site included 28 acres

of wetlands. The district court found, on the basis of

expert testimony, that water from the site spilled into

the Hoppler Drain, which carried water into the

Hoppler Creek and ultimately into the Kawkawlin

River, which is navigable. The second parcel, known as

the Hines Road site, consisted of 275 acres, which

included 64 acres of wetlands. These wetlands had a

surface-water connection to the Rose Drain, which

carried water into the Tittabawassee River, a

navigable waterway. The final parcel, called the Pine

River site, consisted of some 200 acres. This site

included 49 acres of wetlands, and a surface water

connection linked the wetlands to the nearby Pine

River, which flowed into Lake Huron. The wetlands at

issue in all three parcels were neither directly adjacent

to nor entirely isolated from a navigable water of the

United States.

The United States brought an action against the

Rapanos petitioners for civil violations of the CWA.

Specifically, the government claimed that petitioners

discharged fill into protected wetlands, failed to

respond to requests for information, and ignored

12a

administrative compliance orders. After a 13-day

bench trial, the district court made factual findings

upholding the Corps’ jurisdiction over wetlands on the

three parcels. On the merits the court ruled in the

government ’s favor, finding that violations occurred at

all three sites. The United States Court of Appeals for

the Sixth Circuit affirmed, 376 F.3d 629 (2004). The

other consolidated case, Carabell, similarly involved

discharges into wetlands that connected through a

series of waterways to a navigable water of the United

States, and the Sixth Circuit similarly held that the

wetlands were covered by the Act. 391 F.3d 704 (6th

Cir. 2004).

In Rapanos; a 4-4-1 plurality opinion, the Supreme

Court addressed how the term “navigable waters”

should be construed under the Act. The plurality,

written by Justice Scalia for four Justices, would have

reversed on the grounds that only those wetlands with

a continuous surface connection to bodies that are

“waters of the United States” are protected under the

CWA. Justice Stevens, writing the dissent for four

Justices, would have affirmed on the grounds that

even wetlands not directly adjacent to navigable

waters, but adjacent to tributaries of navigable waters,

are protected under the CWA. Justice Stevens also

argued that Riverside Bayview Homes is still the

controlling precedent and does not require a

“significant nexus” test.

Justice Kennedy, constituting the fifth vote for

reversal, concurred only in the judgment. His

concurrence is the narrowest ground to which a

majority of the Justices would assent if forced to

choose in almost all cases. See United States v. Gerke,

13a

464 F.3d 723, 724 (7th Cir. 2006); see also Rapanos,

126 S. Ct. at 2265 n.13 (J. Stevens dissenting). Thus,

as the Seventh Circuit extensively explained in Gerke,

464 F.3d 724, Justice Kennedy’s concurrence provides

the controlling rule of law for our case. See also Marks

vu. United States, 430 U.S. 188, 193 (1997).

Justice Kennedy said that when wetlands are

isolated, or adjacent only to a non-navigable tributary

of a navigable waterway, those wetlands are regulable

under the CWA only if there is a significant nexus

between the wetlands at issue and the navigable

waterway. Rapanos, 126 S. Ct. at 2248. He explained

that a significant nexus exists “if the wetlands, either

alone or in combination with similarly situated lands

in the region, significantly affect the chemical,

physical, and biological integrity of other covered

waters more readily understood as ‘navigable.”

Rapanos, 126 S.Ct. at 2248. “When, in contrast,

wetlands’ effects on water quality are speculative or

insubstantial, they fall outside the zone fairly

encompassed by the statutory term ‘navigable

waters.’ ” Id.

In addressing whether a hydrological connection

satisfies the “significant nexus” test, Justice Kennedy

explained that a “mere hydrologic connection should

not suffice in all cases; the connection may be too

insubstantial for the hydrologic linkage to establish

the required nexus with navigable waters as

traditionally understood.” Jd. at 2251. Rather, the

“required nexus must be assessed in terms of the

statute’s goals and purposes,” which are to “restore

and maintain the chemical, physical, and biological

l4a

integrity of the Nation’s waters.” Jd. at 2248 (internal

quotations and citations omitted).

[6] Justice Kennedy thus established a substantial

nexus test for the applicability of the Act, concluding

that “absent a significant nexus, jurisdiction under the

Act is lacking.” Jd. at 2241. But, at the same time,

Justice Kennedy also reaffirmed the holding of

Riverside Bayview Homes that wetlands adjacent to

navigable waterways are covered by the Act, saying

that by virtue of the “reasonable inference of ecologic

interconnnection,” assertion of jurisdiction “is

sustainable under the Act by showing adjacency

alone.” Id. at 2248. This indicates that a significant

nexus may be inferred when wetlands are adjacent to

navigable waters.

In this case, we have both. The Pond is part of a

larger wetland that is “adjacent” to the River within

the meaning of Riverside Bayview Homes. There is also

a “substantial nexus” present under the analysis of

Justice Kennedy in Rapanos.

{7} The water from the Pond seeps into the river

through both the surface wetlands and_ the

underground aquifer. The district court’s findings of

fact regarding this hydrological connection support the

conclusion that Basalt Pond has a significant effect on

“the chemical, physical, and biological integrity” of the

Russian River. There is accordingly a substantial

nexus between the Basalt Pond and covered waters

sufficient to confer jurisdiction under the Act pursuant

to Justice Kennedy's substantial nexus test. See id. at

2241.

15a

With respect to the physical effect on the River,

there is an actual surface connection between Basalt

Pond and the Russian River when the River overflows

the levee and the two bodies of water commingle.

There is also an underground hydraulic connection

between the two bodies, so a change in the water level

in one immediatcly affects the water level in the other.

Basalt Pond drains into the aquifer and at least 26

percent of the Pond’s volume annually reaches the

River itself. Thus, there are several hydrological

connections between Basalt Pond’s wetlands and the

Russian River that affect the physical integrity of the

River.

In addition to these physical connections between

Basalt Pond and the Russian River, the district court

found that there is also a significant ecological

connection. The Pond and its wetlands support

substantial bird, mammal and fish populations, all as

an integral part of and indistinguishable from the rest

of the Russian River ecosystem. Many of the bird

populations at the Pond are familiar along the River,

including cormorants, great egrets, mallards,

sparrows, and fish-eaters. Fish indigenous to the River

also live in the Pond due to the recurring breaches of

the levee. As the district court observed, these facts

make Basalt Pond indistinguishable from any of the

natural wetlands alongside the Russian River that

have extensive biological effects on the River itself.

The district court also found that Basalt Pond

significantly affects the chemical integrity of the

Russian River by increasing its chloride levels. The

chloride from Basalt Pond reaches the River in higher

concentrations as a direct result of Healdsburg’s

l6a

discharge of sewage into the pond. Mr. John Lambie

testified at trial that the average concentration of

chloride appearing upstream in the river is only 5.9

parts per million. In contrast, the average

concentration of chloride seeping from Basalt Pond

into the River is 36 parts per million, and the chloride

concentration on the west side of the River adjacent to

the Pond is 18 parts per million.

{8]In sum, the district court made substantial

findings of fact to support the conclusion that Basalt

Pond has a significant nexus to the Russian River. The

Pond’s effects on the Russian River are not speculative

or insubstantial. Rather, the Pond significantly affects

the physical, biological and chemical integrity of the

Russian River, and ultimately warrants protection as

a “navigable water” under the CWA. Appellant’s

discharge of wastewater into Basalt Pond without a

permit, therefore, violates the CWA unless it falls

within one of the Act’s exceptions.

B. Waste Treatment System Exception

{9] Appellant claims that even if Basalt Pond

constitutes a water of the United States it 1s exempt

from protection under the CWA’s waste treatment

system exception. The CWA excludes “waste treatment

systems” from “waters of the United States.” The CWA

regulations specifically provide that:

Waste treatment systems, including treatment

ponds or lagoons designed to meet the

requirements of CWA (other than cooling ponds

as defined in 40 CFR 423.11(m) which also meet

17a

the criteria of this definition) are not waters of

the United States.

33 C.F.R. § 328.3(a)(8).

Claims of exemption, from the jurisdiction or

permitting requirements, of the CWA’s broad pollution

prevention mandate must be narrowly construed to

achieve the purposes of the CWA. See United States v.

Akers, 785 F.2d 814, 819 (9th Cir. 1986). Furthermore,

appellant has the burden to prove that this exception

applies to its discharge of wastewater into Basalt

Pond. See United States v. First City National Bank,

386 U.S. 361, 366 (1967); Sierra Club v. Union Oil

Company of California, 813 F.2d 1480, 1484 (9th Cir.

1987) (vacated on other grounds by Union Oil Co. of

California v. Sierra Club, 485 U.S. 931 (1988)).

The waste treatment system exemption was

intended to exempt either water systems that do not

discharge into waters of the United States or waters

that are incorporated in an NPDES permit as part of

a treatment system. See 44 Fed. Reg. 32858 (June 1,

1979); In the Matter of: Borden, Inc. /Colonial Sugars,

1984 1 E.A.D. 895 (E.P.A. 1984). In other words, a

permit is not required to discharge pollutants into a

self-contained body of water that has no connection to

a water of the United States, or into a body of water

that is connected to a water of the United States, but

that is part of an approved treatment system. The

exception was meant to avoid requiring dischargers to

meet effluent discharge standards for discharges into

their own closed system treatment ponds. See 45 Fed.

Reg. 48620-21 (July 21, 1980) (emphasis added).

Regulations under the CWA, however, still extend to

18a

discharges from treatment ponds. Jd. (emphasis

added).

[10] Basalt Pond may be part of a waste

treatment system, but it does not fall under the

exemption because it is neither a self-contained pond

nor is it incorporated in an NPDES permit as part of

a treatment system. For these reasons, we hold that

Basalt Pond is not a waste treatment system exempt

from coverage under the Act.

C. The Excavation Operation Exception

Healdsburg also argues that Basait Pond is exempt

from protection under the CWA because it is the site of

an ongoing excavation operation. In its preamble to the

revisions to its CWA regulation, the ACOE stated:

For clarification it should be noted that we

generally do not consider the following waters to

be “Waters of the United States... .”

* * *

(e) Waterfilled depressions created in dry land

incidental to construction activity and pits

excavated in dry land for the purpose of

obtaining fill, sand, or gravel unless and until

the construction or excavation operation is

abandoned and the resulting body of water

meets the definition of waters of the United

States (see 33 C.F.R § 328.3(a)).

51 Fed.Reg. 41206, 41217 (1986) (emphasis added).

Appellant argues that Basalt Pond is used as part of

19a

an active gravel excavation operation and is, therefore,

exempt from NPDES regulation. The district court

correctly found that there is no merit to this claim.

The district court found that although Syar

operates reclamation activities at Basalt Pond, those

activities do not constitute an ongoing excavation

operation as defined by the ACOE’s exemption. The

Basalt Rock Company, Syar’s predecessor, ceased its

excavation of rock or sand from Basalt Pond in 1984.

Syar, through its reclamation activities, has never

extracted rock or sand from the pond. Rather, Syar has

pumped a slurry of sand and sediment into Basalt

Pond. These findings support the conclusion that all

excavation operations at Basalt Pond have been

abandoned.

111] Syar does continue to use Basalt Pond as a

discharge location for its surface mining operations at

other locations, but this does not constitute ongoing

excavation operations. The excavation operation

exemption applies only to ponds undergoing actual

extraction. Basalt Pond is merely tangential to Syar’s

excavation of other lands. Our holding in Leslie Salt

clarifies that the ACOE extraction operations

exemption does not apply to a body of water which

might be part of general commercial activity. 896 F.2d

at 359. Rather, the exemption applies only to bodies of

water that are currently and directly under active

excavation. /d.; see also Golden Gate Audubon Soc.,

Inc. v. U. S. Army Corps of Engineers (Audubon II),

796 F.Supp. 1306, 1315 (N.D. Cal. 1992). The district

court correctly held that the excavation operations

exception dves not apply in this case.

20a

CONCLUSION

The Basalt Pond is part of a larger wetland

adjacent to the Russian River. It also has a significant

nexus to the Russian River, a navigable water of the

United States. Healdsburg, by discharging wastewater

into the Pond without an NPDES permit, therefore,

violated the CWA. The decision of the district court is

AFFIRMED.

2la

APPENDIX B

UNITED STATES DISTRICT COURT

FOR THE NORTHERN DISTRICT

OF CALIFORNIA

No. C 01-04686 WHA

[Filed January 23, 2004]

NORTHERN CALIFORNIA RIVER WATCH,

a non-profit corporation,

Plaintiff,

CITY OF HEALDSBURG,

)

Vv. )

)

Defendant. )

)

JUDGES: WILLIAM ALSUP, UNITED STATES

DISTRICT JUDGE.

OPINION

FINDINGS OF FACT AND CONCLUSIONS OF

LAW AND REMEDIAL ORDER AFTER BENCH

TRIAL

22a

INTRODUCTION

The basic question concerns the extent to which a

pond formed from an old gravel pit and adjacent

wetlands, all alongside the Russian River, are within

the jurisdiction of the Clean Water Act. The issue is of

importance because defendant City of Healdsburg

discharges all of its treated sewage into the pond,

which then drains via an aquifer into the nearby

Russian River. It does so without an NPDES permit.

After a bench trial, this order now holds that an

NPDES permit is needed.

PROCEDURAL HISTORY

Plaintiff Northern California River Watch filed the

instant citizen suit under the Clean Water Act against

defendant City of Healdsburg on December 4, 2001.

The complaint was based on allegations that

Healdsburg routinely makes unauthorized discharges

of pollutants from its waste-treatment facility into

Basalt Pond, a pond formed from an old gravel mining

pit alongside the Russian River. The pond and its

wetlands, River Watch elaims, are part of the

“navigable waters of the United States.” It is

stipulated (No. 28) that pleintiff has standing to assert

claims with regard to tive Russian River under the Act.

Similar allegations formed the basis of a companion

suit filed by River Watch on July 9, 2002, against Syar

Industries, Inc., as to its wastewater discharges into

Basalt Pond. The actions were consolidated. Syar

settled. The consent decree was filed on August 5,

2003, bringing to a close the litigation as to Syar.

23a

River Watch and Healdsburg filed cross-motions for

summary judgment. The Court granted partial

summary judgment in favor of River Watch, finding

that Healdsburg (i) discharged (ii) treated wastewater

(iii) from a pipe extending from its treatment plant

into Basalt Pond (iv) without an NPDES permit. On

the summary-judgment record presented, however,

whether Basalt Pond was within the “navigable waters

of the United States” remained an open question. A

bench trial commenced December 16, 2003. After four

days of evidence and argument, this order now scts

forth the Court’s findings of fact and conclusions of

law.'

FINDINGS OF FACT

The Russian River, all agree, is within the

navigable waters of the United States. Its headwaters

originate in Mendocino County, California. Its main

course runs about 110 miles, flowing into the Pacific

Ocean west of Santa Rosa. Before modern times, the

Russian River occasionally overflowed its banks and

created natural ponds and wetlands along its banks.

During high water, it forged new channels, stranding

the old channels, creating oxbow lakes, and saturating

and supporting adjacent wetlands. All of these ponds

and wetlands, together with the river, supported plant

life and fish and wildlife in an integrated ecosystem.

' Except in instances where citation may be of particular use to

the parties or the court of appeals, this order will not cite the

record, finding it unnecessary and cumbersome.

24a

With civilization, the river became more controlled.

Towns grew up along and near the river. Nearby land

was cleared for agriculture and ranching. To protect

these developments, levees were built in some places,

dams in others, and the channel was dredged for flood

control. The river was not completely tamed, however.

Even today, large storms overpower the flood controls

on occasion. In 1995, during persistent winter rains,

the levee between the river and the site here in

question, the so-called Basalt Pond in Sonoma County,

was breached twice and once again in 1997. In 2002,

the flood level reached within a foot of the levee top,

even after an extra three vertical feet had been added

to the levee.

The Russian River and surrounding area rest on

top of a vast gravel bed extending as much as sixty feet

into the earth. The gravel bed is the result of ancient

processes over geologic time whereby rock was washed

downstream, the edges sanded smooth. This resulted

in huge deposits of river rock, sand, and gravel. The

gravel bed is a porous medium, saturated with water.

Through it flows an equally vast underground aquifer.

This fact poses two significant points of interest in this

case. It explains why so much gravel mining has

occurred along the river. It also supplies the principal

pathway for a continuous passage of water between

Basalt Pond and the Russian River.

Basalt Pond lies alongside and west of the river,

the two separated by a levee. Whether a tarn, even a

slight one, pre-existed the Basalt Pond excavation is

doubtful on this record. Be that as it may, we know

that in approximately 1967, the Basalt Rock Company,

a division of Dillingham Construction Company, began

25a

excavating gravel and sand from the terrace land near

the river (as well as other mining locations in the

surrounding area). The terrace top soil was ripped

away. Large machines then tore out rock and sand.

When the water table was reached, drag lines

continued the excavation, dropping into the water and

pulling out more rock and sand. The ore was hauled

away and processed at a nearby plant. The result was

a pit. It filled with water up to the line of the water

table of the surrounding aquifer, i.e., the pond opened

the aquifer to the sky. In this manner, Basalt Pond

was created. Today, the pond has 58 acres of surface

water. It is a half-mile long and a quarter-mile across.

A map of the river and the pond is reproduced in

Figure 1.

Figure 1

BEST AVAILABLE COPY

26a

The horizontal distance between the river’s edge

and the pond’s edge varies between fifty and several

hundred feet, depending on the exact location and the

height of the water. For at least 750 feet along the cast

side of the pond, the distance is less than 100 to 200

feet at normal water stages (TX 21 at H1365).

Normally, there is no surface connection, the levee

blocking the way. But for the levee the pond would be

inundated by high river waters in the rainy season. As

stated, the levee has broken three times in the last

eight years, each time the levee being repaired within

a few months (Stip. No. 18). To a minor extent, a

vestige of uplands remain in some places near the

pond, but they are below the levee top and are likewise

subject to inundation.

Beneath the surface the story is different. There,

water soaks in and out of the pond via the pervasive

underground aquifer. This action is continuous, 24

hours a day, seven days a week, 365 days a year. In

fact, water from the aquifer flows downhill from the

side of the valley, through the pond and under the

levee -- all via the gravel-laden, water-saturated

aquifer. The subterranean flow finally bleeds into the

river itself or at least a large part of it does. It is

stipulated herein that the pond and the river overlie

the same unconfined aquifer and that the land

separating the two is saturated below the water table.

In this sense, the underground aquifer is a slow-

moving, underground tributary of the river. The pond

is an open way station on the underground tributary.

In an official report, Healdsburg itself has

characterized the water system as follows (TX 24 at

H3037):

27a

The groundwater basin is _ hydraulically

connected to the Russian River. In the Russian

River Valley, groundwater moves from the

margins toward the Russian River during most

of the year. Groundwater in the project area

generally flows to the southeast with a gentle

gradient. When groundwater levels are

depressed, usually during the fall, flow in

Russia River recharges the groundwater

reservoir. River water moves into the alluvium

during high river stages in the autumn and

winter, and also during the summer in locations

where large volumes of water are withdrawn

from the river. Most recharge to the

groundwater is derived from infiltration of rain

that falls on the valley floor and from seepage

into permeable deposits that underlie channels

of the tributary streams.

Although the Basalt Rock Company began its

excavation of Basalt Pond in 1967, excavation ceased

in 1984. In 1986, Syar Industries, Inc., acquired all of

the local land and business of the Basalt Rock

Company. Syar did not resume any extraction at

Basalt Pond. Syar, however, carried on and still does

carry on extraction at other pits in the area. Since

1984, no excavation has occurred at Basalt Pond. No

activity at all was underway at the pond between 1984

to 1986 (TX 7 at RW0462-63). Healdsburg itself has

referred to Basalt Pond as “an abandoned quarry” (TX

24 at H3038).

Reclamation activities by Syar, however, have been

underway at Basalt Pond since 1986. To this end, Syar

has pumped a slurry of sand and sediment from its

28a

main aggregate processing plant near Healdsburg via

a long pipe into Basalt Pond. This slurry is a by-

product of rock extracted elsewhere -- again, not froin

Basalt Pond. The outfall from the slurry pipe flows

onto the margin of Basalt Pond, the outfall point being

moved from time to time, such that the sediment and

fill have slowly been filling in and reclaiming the edges

of the pond as wetlands. As well, a considerable

amount of sediment has drifted over the entirety of the

pond and settled to the bottom, forming a layer that

helps filter out pollutants as water drains into the

aquifer. Since 1993, Syar has been directed by the

county to direct the flow of sediment to the bank near

the levee. This is meant to strengthen the levee (on the

pond side). The reclamation/slurry process is expected

to go on for many years.

Trees and plants have also been planted along the

reclaimed margins, all for the purpose of developing

man-made wetlands. Most of the plants and trees that

inhabit the riparian forests along the river and pond

are wind pollinated and disperse their seeds by wind.

The result is that similar plants and trees appear in

abundance in both locations. A few of the most

common include cottonwoods, coyote brush, willows,

and red willow trees. Although virtually the entire

perimeter of the pond is now wetlands, the

predominate wetlands are along the east and

southeast margins of the pond. The perimeter is

characterized by the presence of vegetation that

requires saturated soil conditions for growth and

reproduction.

The wetlands, in turn, now support substantial

bird, animal and fish populations, all as an integral

29a

part of and indistinguishable from the rest of the

Russian River ecosystem. Many of the bird populations

at the pond are familiar along the river, including

cormorants, great egrets, mallards, sparrows, and fish-

eaters. Fish indigenous to the river also live in the

pond due to the recurring breaches of the levee. As a

result, it would be hard to distinguish Basalt Pond

from any of the natural wetlands and tarns that have

developed alongside the Russian River over the course

of time.

In 1971, defendant City of Healdsburg built a

secondary waste-treatment plant on a 35-acre site

located on the north side of Basalt Pond about 800 feet

from and west of the river. Prior to 1978, Healdsburg

discharged its wastewater into another water-filled pit

located to the north. In 1978, Healdsburg began

discharging into Basalt Pond. It continues to do so

pursuant to permission from Syar and pursuant to a

state water permit. The treated outfall, however, does

not meet NPDES standards. No NPDES permit has

ever been obtained.

Wastewater discharges to Basalt Pond from the

plant were between 420 and 455 million gallons per

year between 1998 and 2000. The volume of the pond

itself is of the same order of magnitude -- 450 to 740

million gallons. The annual outflow from the sewage

plant, therefore, is sufficient to fill the entire pond

every one to two years. The pond would, of course, soon

overflow in these circumstances were it not for the fact

that the pond drains into the surrounding aquifer.

Because of this drainage, the pond has reached a

30a

steady state in which the “volume in” equals the

“volume out.” ”

Much evidence was received at trial on the precise

underground relationship between the pond and the

river. The normal surface level of the pond is only a

few feet higher than the normal level of the river. This

conforms to the general terrain by which the

underground aquifer, collecting water from the larger

drainage of the river vailey, flows downhill through the

pond and then into the river or river bed. The large

quantity of treated sewage has caused the level of the

pond water to rise somewhat higher than the normal

water table of the groundwater. As stated, the

downhill flow passes through the pond, albeit slowly,

and eventually moves yet farther downhill. According

to Healdsburg’s water expert at trial, at least one-

fourth of the liquid in the pond finds its way into the

river proper. Healdsburg’s own environmental impact

report gave a higher and more probable estimate: “It

is likely that the entire volume of treated wastewater

and aggregate wash water discharged to Basalt Pond

(2.1 cfs) will eventually migrate to the River, either

directly through the aquifer or indirectly” (TX 24 at

H3186-87). Pond water will ordinarily take several

months to find its way to the river and drains into the

river over a stretch as long as 2200 feet. Although the

discharges into the pond do not meet NPDES

standards, the pollutants are diluted by the time they

actually bleed into the Russian River.

’ The primary “volume in” comes from the plant. The primary

“volume out” is drainage to the aquifer. There is also rainfall (in),

aquifer leakage (in), and evaporation (out), all lesser factors.

3la

In passing through the bottom and sides of the

Basalt Pond, the effluent is partially cleansed. This

cleansing and settling process is sometimes referred to

as “polishing” or “percolation” by Healdsburg. Since

groundwater flows through the pond, the flow is not

only through the bottom, as Healdsburg contends, but

also is through the sides including through the

wetlands along the margin of the pond -- particularly

those heavier wetlands between the pond and the

levee. These wetlands also help cleanse the outflow by

passing the effluent through the wetlands sediment,

just as the outflow through the silt bottom likewise

filters the fluid. The filtration is effective in reducing

biochemical oxygen demand and removing some

pollutants.

The filtration is not perfect. The concentrations of

chloride in the groundwater between the pond and the

river, for example, are substantially higher than in the

surrounding area. Chloride, which already exists in

the pond due to naturally occurring salts, reaches the

river in higher concentrations as a direct result of

Healdsburg’s discharge of sewage into the pond. Mr.

John Lambie, a water trial expert for Healdsburg,

testified that the average concentration of chloride

appearing upstream in the river is only 5.9 parts per

million. In contrast, the average concentration of

chloride in the water exiting Basalt Pond is 36 parts

per million. At a monitoring well between the pond

and the river, the underground concentration is

diluted to some 30 parts per million. Ultimately, a

chloride concentration of 18 parts per million appears

on the west side of the river adjacent to the pond. As

such, chior:¢e from the pond over time makes its way

32a

to the river in higher concentrations than naturally

occurring in the river (Tr. 588-92).°

The river and the pond rise and fall in tandem. The

reason is that they are connected by the aquifer. A

relative change in the heads of pressure between the

two waterbodies will influence each, almost

immediately, causing an adjustment in the surface

levels. This influence is “hydraulic,” meaning the

pressure is transmitted within the underground fluid

body itself. One might think that river water was

flowing into the pond via the aquifer, but not so. The

levels do not rise and fall in tandem for any such

* This finding is further supported by Dr. Larry Russell, one of

River Watch’s trial experts. Chloride is a highly soluble pollutant

that moves with the flow of water. Were it not for the discharge

into the river, Dr. Russell stated that the chloride in the pond

would build up, thereby making it saltier and saltier from year to

year. That, however, is not the case here. The chloride levels in

the pond generally remain steady, which means that what

Healdsburg discharges into the pond in the form of chloride must

go through the groundwater aquifer and eventually out into the

river, even if it isin a more diluted form (Tr. 94-95). Although Dr.

Russell did not express an opinion as to what quantity of chloride

could emerge in the river from the pond, he did examine data

taken from the monitoring well fifty feet away from the pond. The

data was gathered and presented in an environmental impact

report prepared by Healdsburg. The measurements were

commensurate with the figures considered by Dr. Lambie in that

the chloride levels at the pond and at the well were of the same

order of magnitude. Dr. Russell concluded that there was a

migration of chloride from the pond through the well and then to

the river (Tr. 96-97).

33a

reason. Such a direct effect would be difficult, given

the slow transit time of water through the sponge-like,

gravelly texture of the alluvium. Instead, the reason is,

as stated, because the gravel is saturated with water

and it instantly transmits any pressure change. Any

pressure difference in the river, as it rises and falls, is

thus transmitted through the aquifer, which forces

groundwater up into the pond or pulls pond water

through bottom and side layers down into the

alluvium, as the case may be. The above represent the

findings necessary to address the main conclusions of

law. For clarity and ease in presentation, additional

findings will be made below.

CONCLUSIONS OF LAW

The Clean Water Act of 1972 established two

programs of importance to this case. Section 402

authorized the Environmental Protection Agency to

administer the National Pollution Discharge

Elimination System (NPDES). Under Section 301(a),

sewage treatment facilities and other point sources

were barred from making discharges into the

navigable waters of the United States without an

NPDES permit. 33 U.S.C. 1311(a). The Act allowed

EPA to authorize state agencies to administer the

NPDES program. In most states, including California,

the NPDES program is administered by state agencies

pursuant to federal standards. The second program of

note herein was authorized by Section 404. It

prohibited dredging or filling of any navigable waters

of the United States without a permit from the Army

Corps of Engineers. 33 U.S.C. 1344. Thus, the

jurisdictional reach of both programs depends on the

term “navigable waters of the United States.”

34a

All agree herein that the Russian River falls within

the “navigable waters of the United States.” The

Healdsburg system is a “point source.” All agree that

Healdsburg has never had an NPDES permit. The

issue is whether Basalt Pond and/or its wetlands fall

within the navigable waters of the United States such

that an NPDES permit is required.

If Healdsburg were required to apply for and obtain

an NPDES permit, it would be subject to regulation

over and above that imposed by its state-issued

permits. For example, Healdsburg currently

chlorinates its treated sewage but is not required to

de-chlorinate it prior to discharge into Basalt Pond.

This would change if the pond were within the

“navigable waters of the United States.” Healdsburg

would then need an NPDES permit and be required to

de-chlorinate its treated sewage prior to discharge (Tr.

295-96). Thereafter, toensure compliance with the Act,

Healdsburg would have to establish and maintain

records and install, use, and maintain equipment to

monitor and sample the chlorine (or any other

pollutant) present in its discharge. On a regular basis,

compliance reports would have to be submitted to the

California Regional Water Quality Control Board for

review.

1. THE NAVIGABLE WATERS OF THE

UNITED STATES.

The “navigable waters of the United States” is a

term of venerable vintage, first appearing as

“navigable waters” in the celebrated case of Gibbons v.

Ogden, 22 U.S. 1, 21-22, 6 L. Ed. 23 (1824), and then

in full form in Mayor of New York v. Miln, 36 U.S. 102,

35a

135, 9 L. Ed. 648 (1837). It defines a federal servitude,

derived from the commerce clause, that overlays what

might otherwise be considered state waters. After

decades of federal common-law usage, Congress

adopted the term to set the jurisdictional limits of

numerous river, harbor, and waterway laws.

The Clean Water Act of 1972 defined the term

“navigable waters” to mean “waters of the United

States, including the territorial seas.” 33 U.S.C.

1362(7). This definition is an important one, for it

defines the outer jurisdictional limits of two federal

agencies under the Act -- the Environmental

Protection Agency and the Army Corps of Engineers.

The manifest intent was expansive -- to cover not just

waters deemed navigable under the traditional test

but to cover any waters affecting interstate commerce.

Leslie Salt Co. v. United States, 896 F.2d 354, 357 (9th

Cir. 1990). Even under the narrowest definition, it is

generally agreed that the term covers (i) actually

navigable waters, (ii) their tributaries, and (iil)

wetlands adjacent to each. This case presents issucs

under both the “tributary” prong and the “wetlands”

prong. The latter will be considered first.

2. WETLANDS.

After the Act was passed, an issue arose concerning

the extent to which adjacent wetlands were covered.

Subdividers, developers and others wished to fill in

wetlands and build. In 1978, the Army Corps of

Engineers, however, issued an interpretative ruling

stating that “adjacent wetlands” were within the

protection of “waters of the United States.” This

brought such wetlands under Section 404 of the Act

36a

which prohibits dredging or filling withcut a permit

from the Corps. 33 U.S.C. 1344. Although the wetlands

regulation has been reissued from time to time, and

twice reviewed by the Supreme Court, the language

here relevant has been in the regulation all along.

Under the interpretive regulation, the term “waters

of the United States” includes “wetlands adjacent to”

a navigable water like the Russian River. 33 C.F.R.

328.3(a)(7) (2003).

In turn, the term “wetlands” is defined as

follows:

The term wetlands means those areas

that are inundated or saturated by

surface or ground water at a frequency

and duration sufficient to support, and

that under normal circumstances do

support, a prevalence of vegetation

typically adapted for life in saturated soil

conditions. Wetlands generally include

swamps, marshes, bogs, and similar

areas.

Id. at 328.3(b).

“Adjacent,” in turn, is defined as follows:

The term adjacent means bordering,

contiguous, or neighboring. Wetlands

separated from other waters of the

United States by man-made dikes or

barriers, natural river berms, beach

37a

dunes and the like are “adjacent

wetlands.”

Id. at 328.3(c).

The interpretive rule of the Army Corps of

Engineers was litigated all the way to the United

States Supreme Court by a Michigan owner of a

housing developer, Riverside Bayview Homes, Inc.

Ruling for the developer, the Sixth Circuit had limited

jurisdiction over wetlands to those created by frequent

flooding of the nearby navigable waters and excluded

wetlands saturated by groundwater or surface water.

The Supreme Court reversed and sustained the

broader reach of the Act over wetlands as defined in

the regulation. The Supreme Court recognized that

some point must be found where water ends and land

begins. United States v. Riverside Bayview Homes,

Inc., 474 U.S. 121, 132, 88 L. Ed. 2d 419, 106 S. Ct.

455 (1985). In this transitional zone, a regulatory

definition was warranted. When the purposes of the

Act were considered, the Supreme Court found a more

expansive regulation of wetlands under the Act was

reasonable and deferred to the Corps’ interpretation

(id. at 132-33):

Faced with such a problem of defining the

bounds of its regulatory authority, an agency

may appropriately look to the legislative history

and underlying policies of its statutory grants of

authority. Neither of these sources provides

unambiguous guidance for the Corps in this

case, but together they do support the

reasonableness of the Corps’ approach of

defining adjacent wetlands as “waters” within

38a

the meaning of § 404(a). Section 404 originated

as part of the Federal Water Pollution Control

Act Amendments of 1972, which constituted a

comprehensive legislative attempt “to restore

and maintain the chemical, physical, and

biological integrity of the Nation’s waters.”

CWA § 101, 33 U.S.C. $ 1251. This objective

incorporated a broad, systemic view of the goals

of maintaining and improving water quality: as

the House Report on the legislation put it, “the

word ‘integrity’ . . . refers to a condition in

which the natural structure and function of

ecosystems [are] maintained.” H.R. Rep. No 92-

911, p. 76 (1972). Protection of aquatic

ecosystems, Congress recognized, demanded

broad federal authority to control pollution, for

“water moves in hydrologic cycles and it is

essential that discharge of pollutants be

controlled at the source.” S. Rep. No. 92-414, p.

77 (1972).

The Supreme Court repudiated the notion that

wetlands themselves had to be navigable (id. at 133):

In keeping with these views, Congress chose to

define the waters covered by the Act broadly.

Although the Act prohibits discharges into

“navigable waters,” see CWA § § 301(a), 404(a),

502112), 33 U.S.C. $ $ I1311(a), 1344(a),

1362(12), the Act’s definition of “navigable

waters” as “the waters of the United States”

makes it clear that the term “navigable” as used

in the Act is of limited import. In adopting this

definition of “navigable waters,” Congress

evidently intended to repudiate limits that had

39a

been placed on federal regulation by earlier

water pollution control statutes and to exercise

its powers under the Commerce Clause to

regulate at least some waters that would not be

deemed “navigable” under the classical

understanding of that term. See S. Conf. Rep.

No. 92-1236, p. 144 (1972); 118 Cong. Rec.

33756-33757 (1972) (statement of Rep. Dingell).

The Supreme Court found reasonable the agency’s

conclusion “that adjacent wetlands are inseparably

bound up with the ‘waters’ of the United States.” /d. at

134. In part, the Supreme Court stated (ibid. ):

... The Corps has concluded that wetlands may

affect the water quality of adjacent lakes, rivers,

and streams even when the waters of those

bodies do not actually inundate the wetlands.

For example, wetlands that are not flooded by

adjacent waters may still tend to drain into

those waters. In such circumstances, the Corps

has concluded that wetlands may serve to filter

and purify water draining into adjacent bodies

of water, see 33 CFR § 320.4(b)(2)(vii) (1985),

and to slow the flow of surface runoff into lakes,

rivers, and streams and thus prevent flooding

and erosion, see § § 320.4(b)(2)(ivjand (v). In

addition, adjacent wetlands may “serve

significant natural biological functions,

including food chain production, general

habitat, and nesting, spawning, rearing and

resting sites for aquatic . . . species.”

§ 320.4(b)(2)@%). In short, the Corps has

concluded that wetlands adjacent to lakes,

rivers, streams, and other bodies of water may

40a

function as integral parts of the aquatic

environment even when the moisture creating

the wetlands does not find its source in the

adjacent bodies of water.

This ringing language is now invoked by River

Watch. Without question, Riverside Bayview militates

in favor of an expansive view of Clean Water Act

jurisdiction over wetlands. Healdsburg contends,

however, that a later decision by the Supreme Court

limited Riverside Bayview. More specifically,

Healdsburg maintains the Supreme Court has now

imposed a “hydrological-connection” requirement or, to

state what Healdsburg really means, a “surface

hydrological-connection” requirement.

It is true that Solid Waste Agency of Northern Cook

County v. United States Army Corps of Engineers, 531

U.S. 159, 148 L. Ed. 2d 576, 121 S. Ct. 675 (2001)

(“SWANCC”), held that the Corps had gone too far in

asserting jurisdiction over a series of nonnavigable,

intrastate, isolated, and abandoned mining pits away

from any navigable waters and whose only connection

to navigable water was that migratory birds used both

as habitat. In rejecting the Corps’ so-called “migratory-

bird rule,” a wetlands rule added by the Corps in 1986

to reach isolated intrastate waters, the Supreme Court

said: “The term ‘navigable’ has at least the import of

showing what Congress had in mind as its authority

for enacting the CWA: its traditional jurisdiction over

waters that were or had been navigable in fact or

which could reasonably be so made.” SWANCC, 531

U.S. at 172.

4la

Although the Ninth Circuit has not yet ruled on the

restrictive theory advanced by Healdsburg, the Ninth

Circuit seems to have read SWANCC as only

invalidating the migratory-bird rule as applied to

isolated waters. Headwaters, Inc. v. Talent Irrigation

Dist., 243 F.3d 526, 533 (9th Cir. 2001). At all events,

as this Court reads it, SWANCC did not impose a rule

of “hydrological connection,” much less a rule of

“surface hydrological connection.”

SWANCC dealt specifically with physically isolated

rather than adjacent waterbodies. The Supreme Court

recognized this when it stated:

We found [in Riverside Bayview] that

Congress’ concern for the protection of

water quality and aquatic ecosystems

indicated its intent to regulate wetlands

“inseparably bound up with the ‘waters’

of the United States.”

It was the significant nexus between the

wetlands and “navigable waters” that

informed our reading of the CWA in

Riverside Bayview Homes. Indeed, we did

not “express any opinion” on_ the

“question of the authority of the Corps to

regulate discharges of fill material into

wetlands that are not adjacent to bodies

of open water ... .” In order to rule for

[the Corps] here, we would have to hold

that jurisdiction of the Corps extends to

ponds that are not adjacent to open

water. But we conclude that the text of

the statute will not allow this.

42a

SWANCC at 167-68 (citations omitted and emphasis in

original). Rather than impose a_hydrological-

connection requirement, SWANCC reaffirmed that

wetlands (and other waterbodies like ponds) adjacent

to navigable waters share a significant nexus worthy

of protection under the Clean Water Act. See id. at 171

(acknowledging that “it is . . . plausible . . . that

Congress simply wanted to include all waters adjacent

to ‘navigable waters’ such as nonnavigable tributaries

and streams’), SWANCC does not impose a

hydrological-connection requirement for adjacent

wetlands and waters.

Therefore, even in its narrowest reading, SWANCC

appears to recognize jurisdiction over (i) actually

navigable waters, (ii) their tributaries, and/or (iii)

wetlands adjacent to each.

Once adjacency is established, the tributary issue

is superfluous. Once wetlands are found to be adjacent

to a river actually navigable, there is no need to

investigate whether the wetlands are interconnected

by surface or groundwaters. The regulation, approved

in Riverside Bayview, recognizes this in stating that

wetlands separated by berms or levees are covered.

Plainly, a berm or levee is inconsistent with any

surface connection. No caselaw is cited holding that

adjacent wetlands must also have a_ surface

hydrological connection.

Although the Corps does not administer the

NPDES program -- EPA does so in conjunction with

state agencies -- EPA has adopted a parallel definition

for wetlands. 40 C.F.R. 122.2 (2003). Since the Act

authorizes both the NPDES regulation and the dredge-

A3a

and-fill regulation, their jurisdictional scope should be

the same. Therefore, it is proper to use the Corps’

definition in this NPDES case.

Applying the regulation to the facts of this case,

this order now holds that Basalt Pond and its wetlands

are “adjacent” to the Russian River within the

meaning of the regulation. The Basalt Pond wetlands

are within a few hundred feet of the Russian River and

at points as little as fifty feet, the difference depending

only on the watcr level of the river and the exact point

used along the half-mile long length of the pond. A

man-made levee separates the two. The regulation

specifically states that “wetlands separated from other

waters of the United States by man-made dikes or

barriers .. . and the like are ‘adjacent wetlands.” 33

C.F.R. 328(c). Again, a surface-water requirement

would be inconsistent with this definition, for dikes

and barriers and levees are manifestly intended to

prevent a surface-water connection. Although the

Supreme Court held in Riverside Bayview that there is

no requirement that the wetlands be inundated

periodically by the river, the wetlands at issue would,

in fact, be flooded in the rainy season but for the levee.

While such a connection is unnecessary for

jurisdiction purposes, there is, in fact, an intimate and

persistent hydrological connection, albeit underground.

The pond drains into the aquifer and at least 26

percent of the pond’s volume concededly surfaces in

the river itself (and this order finds that substantially

more drains actually into the river). There is also an

immediate underground hydraulic connection between

the two bodies, such that the water level in each

immediately affects the water level in the other. Even

44a

on the surface, there is an episodic connection; when

the levee breaches, as it has three times in the last

eight years, the two waterbodics substantially

commingle.

Finally, as in Riverside Bayview, the pond, the

river, and the wetlands all share the same ecosystem.

The wetlands in question help filter pollutants

entering the aquifer and hence the river proper.’ In

every way the pond and wetlands are “adjacent to” the

Russian River. Healdsburg’s own trial expert on

wetlands, a private consultant for hire on the Corps’

regulations, even admitted that the pond could be

considered a type of wetland defined by Section 404 of

the Clean Water Act (Tr. 402-03). In short, the pond

and the wetlands are “waters of the United States”

within the meaning of the Act.°

* To avoid the observation in Riverside Bayview that wetlands

serve to filter and to purify waters, Healdsburg argues that no

water filters through the sides of Basalt Pond and that ail the

water exits only through the bottom of the pond. This curious

suspension of the laws of physics fails on the facts, as found above.

Given that Healdsburg also argues the bottom of the pond is up to

a million times less permeable than the surrounding aquifer --

practically hermetically sealed -- there is all the more reason that

fluid must drain, at least in part, through the sides and through

the wetlands to avoid overflowing (as millions of gallons yearly

pour in from the plant).

* Contrary to Healdsburg’s argument, it does not matter that the

wetlands were man-made. Leslie Salt Co., supra, 896 F.2d at 358.

45a

3. OPEN WATERS VS. WETLANDS.

The accused discharges, Healdsburg contends, are

to “open water,” not to the sides of the pond where the

wetlands reside. This argument draws a_ sharp

distinction between the middle and sides of the water

body. Healdsburg contends it may discharge with

impunity into the middle. The argument, however,

fails on the facts. The outfall is at the northwest corner

of the pond, not in the center. The pond is now

surrounded by wetlands. Healdsburg’s own wetlands

expert testified that virtually the entire perimeter

qualifies as “wetlands” (Tr. 406). The discharges at the

northwest corner near the wetlands must be deemed

into the wetlands.

Even if the outfall were in the dead center of Basalt

Pond, the pond is sufficiently small that the entire

pond must be deemed to be inseparably bound up in

the wetlands now surrounding it. The saturated

margins of the pond -- concededly wetlands -- are, of

course, part of the pond itself. The margins meld into

water in one direction and into land in the other.

Sediments from the shoals spread across the pond and

sink to the underwater sides and bottom. Wetlands are

typically characterized by wet earth interspersed with

open pools, inlets, outlets and other water. At some

size, a pond surrounded by wetlands becomes so small

with such a cross-identity of ecology and with such a

cross-identity of water quality, that the pond must be

46a

deemed inseparable from the wetlands rather than a

separate sheet of open water. So here.®

An alternative way to view the problem, reaching

the same result, is that the pond itself is a “point

source” directly abutting and discharging into the

wetlands. There is substantial merit to this conclusion

since Healdsburg itself argues vigorously that the

pond is an integral part of its treatment facility,

supplying a final step it calls “percolation” or

“polishing.” If so, the entire pond must be deemcd a

“point source” -- otherwise, Healdsburg would have no

point source at all. The term “point source” has been

taken beyond pipes and ditches and now includes less

discrete conveyances, such as cesspools and ponds. An

analogous holding was made concerning a 38-acre

man-made tailing pond in Washington Wilderness

Coalition v. Hecla Min. Co., 870 F. Supp. 983, 988

(E.D. Wash. 1994); see also Community Ass’n for

Restoration v. Bosma Dairy, 305 F.3d 943, 955 (9th

Cir. 2002). So viewed, the point source is right in the

middle of and directly abuts the protected wetlands.

This leads to Healdsburg’s invocation of an express

exception under the regulation. The definition of

“waters of the United States” excludes:

° On summary judgment, this Court previously held that,

regardless of the wetlands here involved, ponds adjacent to

navigable rivers and sharing the same ecosystem and having

underground connection to the river are subject to Clean Water

Act jurisdiction. The Basalt Pond would so qualify even without

the wetlands (absent an exception). This is an alternative ground

for rejecting the “open-water” argument advanced by Healdsburg.

47a

Waste treatment systems, including

treatment ponds or lagoons designed to

meet the requirements of CWA (other

than cooling ponds as defined in 40 CFR

423.i1(m) which also meet the criteria of

this definition) are not waters of the

United States.

33 CFR. 328.3(a) last paragraph).

This exception does not aid Healdsburg. Although

the Healdsburg waste-treatment system was designed

so as to use a former mining pit like the Basalt Pond

as a percolation pond, and it was intended that natural

filtration would occur as fluid percolated through the

lining of the pond, this order holds that Basalt Pond

itself was not “designed” to meet the requirements of

the Clean Water Act or “designed” to be part of the

waste-treatment system. The pond preexisted the

plant. It preexisted the Clean Water Act. The pond

was not “designed” with sewage disposal in mind. The

pond was simply the result of digging a pit in the earth

that filled with groundwater. No doubt, the actual

plant was “designed” to take advantage of abandoned

mining pits like Basalt Pond, but the pits themselves

were not so “designed.”

4. TRIBUTARY.

Although it is unnecessary to reach it, this order

also holds that Basalt Pond and the subterranean

groundwater that flows through it are “tributaries” of

the Russian River. This order recognizes that the

caselaw is divided over whether the “tributary” prong

can be satisfied by groundwater as opposed to surface

48a

waters. The Ninth Circuit has not yet addressed the

question. This Court finds persuasive the line of

authority represented by Idaho Rural Council v.

Bosma, 143 F. Supp. 2d 1169, 1178-80 (D. Idaho 2001),

holding that the Act extends federal jurisdiction over

groundwaters hydrologically connected to surface

waters that are themselves navigable waters.

It is urged that no discernible impact on the river

has been shown and therefore a sine qua non of

jurisdiction is missing under Bosna and similar cases.

Contrary to Healdsburg, however, the record shows

that excessive amounts of chloride from Healdsburg’s

effluent in fact pollute the river. The record shows

actual measurements from the monitoring wells

between the pond and the river showing pollution. One

may reasonably infer, as this order does, that this

pollution reaches the nearby river. It, of course, is then

greatly diluted by the river. Nonetheless, the total

volume of pollutants reaching the river over a year is

substantial. This is an alternative ground for

concluding that Basalt Pond and the wetlands are

within the navigable waters of the United States. '

5. ABANDONMENT OF EXCAVATION

OPERATIONS.

The final argument made by Healdsburg is not

based on any statute or regulation or caselaw but on

’ For this, among other reasons, plaintiff has standing to bring

this suit, for a remedial order will benefit the river. It is stipulated

that plaintiff has standing to bring this action to vindicate

aesthetic and recreational interests concerning the river.

49a

an agency statement in a preamble to the 1986

revision of the wetlands regulation. In the preamble,

the Corps stated that it usually does not consider “pits

excavated in dry land for the purpose of obtaining fill,

sand, or gravel” to be “waters of the United States...

until ... [the] excavation operation is abandoned. .. .”

Here is the background.

Pursuant to a directive of the Presidential Task

Force on Regulatory Relief, the Corps proposed

revisions to its Clean Water Act regulation. After

public input, the definitions relevant here were not

changed and were simply recodified at 33 C_F_R. 328.3

(1987). In its preamble to the Federal Register

announcement, however, the Corps added a

clarification:

For clarification it should be noted that

we generally do not consider the

following waters to be “Waters of the

United States.” However, the Corps

reserves the right on a case-by-case basis

to determine that a particular waterbody

within these categories of waters is a

water of the United States. EPA also has

the right to determine on a case-by-case

basis if any of these waters are “waters of

the United States.”

(a) Non-tidal drainage and irrigation

ditches excavated on dry land.

(b) Artificially irrigated areas which

would revert to upland if the irrigation

ceased.

50a

excavating and/or diking dry land to

collect and retain water and which are

used exclusively for such purposes as

stock watering, irrigation, settling

basins, or rice growing.

(d) Artificial reflecting or swimming pools

or other small ornamental bodies of

water created by excavating and/or

diking dry land to retain water for

primarily aesthetic reasons.

(e) Waterfilled depressions created in dry

land incidental to construction activity

and pits excavated in dry land for the

purpose of obtaining fill, sand, or gravel

unless and until the construction or

excavation operation is abandoned and

the resulting body of water meets the

definition of waters of the United States

(see 33 CFR 328.3(a)).

51 Fed. Reg. 41206, 41217 (1986) (emphasis added).

The comment has never been reduced to a formal

regulation. Nonetheless, this order will treat the

preamble statement as_ entitled to deference

concerning the agency’s own interpretation of its own

wetlands regulations and will give it full effect.

Healdsburg urges that the paragraph concerning

excavated mining pits, italicized above, saves it from

NPDES regulation. Healdsburg argues that Syar has

not “abandoned” its “excavation operation” at Basalt

5la

Pond because, although excavation itself ceased long

ago, the reclamation slurry is still underway. As long

as Syar is continuing to reclaim the pond, no matter

how slowly, then jurisdiction is absent, Healdsburg

urges.

This order rejects the argument. Healdsburg itself,

in a recent environmental impact report, called Basalt

Pond “an abandoned quarry” (TX 24 at H3038). No

rock or sand has been excavated from Basalt Pond

since 1984. It is stipulated herein that “excavation at

Basalt Pond ceased in approximately 1984” and that

Syar conducts “pit-excavation activities” on “nearby

lands,” there being no similar stipulation as to Basalt

Pond. In fact, Syar itself has never extracted rock or

sand from the pond, having acquired it after all such

extraction was over. Instead, its only operation has

been to insert, not to extract, silt. The silt, moreover,

is not even from Basalt Pond but from elsewhere. The

silt is the by-product of processing sand and gravel

(again, from elsewhere) and is pumped via a long pipe

to Basalt Pond, where it is slowly being fed into the

margins of the pond, the feed point being moved from

time to time. This is being done pursuant to a local

order to reclaim the pond.

Heaidsburg would stretch “excavation operation,”

as used in the preamble, to comprehend not only

excavation but steps taken thereafter to fill the pit.

The word “excavation” cannot bear this reading. As the

preamble sentence in question states, excavation is

“for the purpose of obtaining fill, sand, or gravel.” It is

not for the purpose of filling in or remediating the pit

after excavation has ceased. Filling in and extraction

are opposites. Once filling in begins, extraction is

52a

foreclosed and must be deemed abandoned. Golden

Gate Audubon Soc., Inc. v. United States Army Corps

of Engineers, 796 F. Supp. 1306, 1315 (N.D. Cal. 1992)

(Henderson, J.). There is also a big difference in terms

of water quality between extracting natural materials

from a pit versus filling up a pit with foreign matter

that could be anything from dirt to wastes to toxics.

Any doubt should be resolved against any exclusion, in

order to promote the purpose of the Act. United States

v. Akers, 785 F.2d 814, 819 (9th Cir. 1986).

Even the preamble refused to say that all pits

would be ignored. Instead, the preamble merely stated

how the Corps “generally” considered them and

acknowledged that pits would be subject to jurisdiction

on a case-by-case basis under Section 404. EPA

likewise so reserved case-by-case jurisdiction under

Section 402. Necessarily, this means that at least some

water-filled pits are waters of the United States. In

deciding which are which, we must harken back to

Riverside Bayview and the fundamental objectives of

the Act. We should, therefore, consider the proximity

to the river, the beneficial role of the wetlands, the

intertwined ecology and riparian habitat. Rather than

focus only on Syar’s desultory slurry, the focus should

also be on the gushing flow of treated sewage into the

pond. Once thriving wetlands have curled about such

a site. it would be topsy turvy to reject protective

jurisdiction solely because reclamation efforts are

underway. Indeed, a contrary ruling would allow

dumping of anything by anyone Syar licensed insofar

as federal law is concerned.

While the foregoing is dispositive of Healdsburg’s

argument, this order must reject plaintiffs alternative

53a

ground in opposition. The argument is that the pit was

abandoned from 1984 to 1986 and was by then already

within the navigable waters of the United States.

Between 1984 and 1986, there was no commercial

activity of any kind at the pond, even remediation (TX

7 at RW0462-63). The pit was idle without any

question in that two-year period. The pond then would

have been subject to jurisdiction so long as the pond

otherwise qualified as a water of the United States.

Plaintiff so urges. The difficulty with plaintiffs

alternative argument is that the wetlands around the

pond developed after 1986. The thriving aquatic life

portrayed at trial as part of the integrated ecosystem

all came later. The record does not show that the pit,

even though abandoned in 1984-86, qualified then as

a wetland or as water of the United States. Plaintiffs

alternative argument therefore must be rejected.

6. THE DISTRICT OFFICE LETTER.

This leads, finally, to the refusal by the district

office of the Corps of Engineers to assert jurisdiction

over Basalt Pond, a separate point of deference urged

by Healdsburg. This has proven to be one of the more

remarkable aspects of the case. In brief, at a time

when Syar was still a party herein, plaintiff's counsel

asked the Corps’ district office to assert jurisdiction

over Basalt Pond. It declined to do so. Healdsburg now

argues that deference is due to the judgment of the

district office to decline jurisdiction, the NPDES

jurisdiction being coextensive with the Corps’

jurisdiction.

Although deference is due to a reasonable agency

interpretation of a statute administered by the agency

54a

and to nationally-promulgated interpretations of its

own regulations, a different problem is presented in

deciding how much deference is due to a single refusal

to act by a single district office of an agency. Before

turning to the law that governs, it is most illuminating

to review what actually happened here. The following

seven paragraphs constitute the Court’s further

findings, placed here for convenience and clarity in

presentation, on the issue of the Corps’ letter.

After this litigation began and before Syar settled

out, plaintiffs counsel wrote a letter to the district

office of the Corps of Engineers in San Francisco.

Counsel supplied information. He requested that the

Corps determine that the Basalt Pond wetlands were

“waters of the United States.”

The response was prepared by Peter Straub, a

Corps employee. After receiving the letter, Mr. Straub

solicited input from personnel at Syar, whom he

admitted at trial were his personal friends. He knew

that Syar was then still a defendant. Syar’s letter

warned Mr. Straub that the request from plaintiffs

counsel should be viewed “with skepticism” and that

counsel was “attempting to embroil the Corps in these

lawsuits.” Syar’s input showed that reclamation

activity was still underway via the slurry described

above.

Mr. Straub circulated an internal e-mail within the

district office. In the e-mail, he explicitly referred to

plaintiffs counsel and Clean Water Act suits in a

derogatory and unprofessional way, stating that

plaintiffs counsel “reaps money from the public trough

by engaging in citizen lawsuits involving the CWA,

55a

ESA, etc.” Ai. + veferring, correctly at first, to plaintiff

counsel as Silver & Silver, Mr. Straub changed it to

“Slither & Slither” in later references in the same e-

mail. He further noted the pendency of the present

case and ventured that plaintiffs counsel had

requested the Corps’ action to bolster plaintiffs case,

stating that the suit would “have greater merit if the

Corps were to exert jurisdiction . . .” (TX 7 at RW0460).

The e-mail was four paragraphs long, all on one

page. The lengthiest paragraph was devoted to

demeaning plaintiffs counsel, their motives and the

lawsuit. The e-mail concluded that “the Basalt Pond

has not been abandoned” and requested the “thoughts”

of the four agency recipients of his e-mail. The record

shows no responsive analysis by anyone. The record

shows no other analytical memos or e-mails by Mr.

Straub. The record shows no reprimand or censure of

Mr. Straub.

Healdsburg presented Mr. Straub as a trial

witness. Significantly, he conceded that in thinking

through the issue, he did not focus on whether the

reclamation slurry was an “excavation operation”

within the meaning of the preamble (Tr. 445-46; 456;

465). Indeed, his final letter to counsel even recognized

that “mining operations” had long since ceased (TX 7

at RW0480). Rather, his focus was solely on whether

any associated activity whatsoever was still being

conducted at Basalt Pond by the owner. In other

words, his view was that as long as the owner had any

activity underway relating to the pond, however slight,

then there was no “abandonment” within the meaning

of the preamble and thus no jurisdiction.

56a

There is no evidence that Mr. Straub or anyone else

consulted a national, regional or even local guideline

or any set of internal precedents or any expert on the

subject within the Corps. Although the Chief of

Engineers periodically issues Regulatory Guidance

Letters with formal policy guidance to local offices, no

such RGL was obtained here or consulted insofar as

the record shows. There is no evidence that Mr. Straub

or anyone else in the chain of review in the district

office had experience or training on the issue raised.

No one inspected the property in response to the

inquiry. No one examined the wetlands or the effluent

discharges.® No one took into account that the pond

was an “abandoned quarry,” as Healdsburg itself had

stated. Mr. Straub simply drafted a short letter

declining jurisdiction and sent it up the chain of local

command, which signed off without comment shown on

this record, and the letter went out.

Mr. Straub was biased against this lawsuit and the

lawyers behind it. Mr. Straub knew, even stated, that

an exercise of jurisdiction would aid plaintiff and

counsel who “reap money from the public trough by

engaging in citizen lawsuits.” He knew that to do so

would hurt his admitted friends at Syar, then a

* The Corps has no jurisdiction respecting NPDES permits. It does

have jurisdiction over filling wetlands (and other waters of the

United States) and permits therefor. Plaintiff tries to use this

distinction to dismiss the letter as irrelevant. Not so. Plaintiff

otherwise itself relies upon the Corps’ own wetland regulation.

Having invoked the Corps’ wetland regulation, plaintiff cannot

run away from any and all attempts by the Corps to interpret its

regulation. Rather, the question is how persuasive the attempt is.

57a

defendant in the case. Although Mr. Straub denied at

trial that he was biased or that his unkind remarks

affected his analysis, his e-mail spoke louder and with

more candor. Plainly, he was biased against plaintiff

and this suit. This order so finds. The Court

disbelieves Mr. Straub’s attempt to brush off his bias.

Moreover, no special expertise was brought to bear, it

being completely unclear whether Mr. Straub had any

experience or training on the subject. No reasonable

investigation was conducted. No attempt to perform a

case-by-case analysis was made as stated by the

preamble. No account was taken of the wetlands, the

proximity to the river, the ecology, or the large tonnage

of treated sewage flowing into the pond and wetlands.

Although Mr. Straub and one of his colleagues testified

at trial, neither attempted to re-affirm the conclusions

reached in the letter. Their testimony was instead

limited to the historical facts leading up to the letter

itself.

How much deference is due to the district office’s

refusal to act? Healdsburg’s counsel would invoke the

letter with all the full-dress deference required by

Chevron U.S.A., Inc. v. Natural Resources Defense

Council, Inc., 467 U.S. 837, 842-45, 81 L. Ed. 2d 694,

104 S. Ct. 2778 (1984). Of course, the Supreme Court

there held that a court must give effect to an agency’s

regulations containing a reasonable interpretation of

an ambiguous statute. But as counsel must surely

know, the Supreme Court has limited Chevron and

refused to apply it to a localized letter like the one at

issue here. In Christensen v. Harris County, 529 U.S.

576, 587, 146 L. Ed. 2d 621, 120 S. Ct. 1655 (2000), for

58a

example, the Supreme Court refused to give any

deference to an agency interpretation contained in an

agency opinion letter without any formal adjudication

or notice-and-comment rulemaking:

Here, however, we _ confront § an

interpretation contained in an opinion

letter, not one arrived at after, for

example, a formal adjudication or notice-

and-comment rulemaking.

Interpretations such as those in opinion

letters -- like interpretations contained in

policy statements, agency manuals, and

enforcement guidelines, all of which lack

the force of law -- do not warrant

Chevron-style deference. See, e.g., Reno

v. Koray, 515 U.S. 50, 61, 132 L. Ed. 2d

46, 115 S. Ct. 2021 (1995) (internal

agency guideline, which is not “subject to

the rigors of the Administrative

Procedure Act, including public notice

and comment,” entitled only to “some

deference” (internal quotation marks

omitted)); EEOC v. Arabian American

Oil Co., 499 U.S. 244, 256-258, 113 L. Ed.

2d 274, i111 S. Ct. 1227 (1991)

(interpretative guidelines do not receive

Chevron deference); Martin vv.

Occupational Safety and Health Review

Comm’n, 499 U.S. 144, 157, 113 L. Ed. 2d

Soo eee oe ae ee OP ee

(interpretative rules and enforcement

guidelines are “not entitled to the same

deference as norms that derive from the

exercise of the Secretary’s delegated

59a

lawmaking powers”). See generally 1 K.

Davis & R. Pierce, Administrative Law

Treatise § 3.5 (3d ed. 1994). Instead,

interpretations contained in formats such

as opinion letters are “entitled to respect”

under our decision in Skidmore v. Swift

& Co., 323 U.S. 134, 140, 89 L. Ed. 124,

65 S. Ct. 161 (1944), but only to the

extent that those interpretations have

the “power to persuade,” ibid. See

Arabian American Oil Co., supra, at 256-

258.

Similarly, in United States v. Mead Corp., 533 U.S.

218, 235, 150 L. Ed. 2d 292, 121 S. Ct. 2164 (2001), the

Supreme Court refused to give Chevron deference to a

ruling letter of the Customs Service regarding a tariff

classification. The Supreme Court held it was only

entitled to “seek a respect proportional to its power to

persuade.” The Court noted that “there would have to

be something wrong with a standard that accorded the

status of substantive law to every one of 10,000

‘official’ customs classifications rulings turned out each

year from over 46 [customs] offices placed around the

country at the Nation’s entryways.” Id. at 238 n. 19.So0

too here. The Corps has 36 district offices, nine

division offices, and countless employees in positions

like Mr. Straub.

In evaluating the “power to persuade,” Mead stated

(id. at 228):

... The fair measure of deference to an

agency administering its own statute has

been understood to vary with

60a

circumstances, and courts have looked to

the degree of the agency’s care [footnote

omitted], its consistency [footnote

omitted], and relative expertness

lfootnote omitted], and to the

persuasiveness of the agency’s position,

see Skidmore, supra, at 139-140. The

approach has produced a spectrum of

judicial responses, from great respect at

one end, see, e.g., Aluminum Co. of

America v. Central Lincoln Peoples’ Util.

Dist., 467 U.S. 380, 389-390, 81 L. Ed. 2d

301, 1048S. Ct. 2472 (1984) (“substantial

deference’” to administrative

construction), to near indifference at the

other, see, e.g., Bowen v. Georgetown

Univ. Hospital, 488 U.S. 204, 212-213,

102 L. Ed. 2d 493, 109 S. Ct. 468 (1988)

(interpretation advanced for the first

time in a litigation brief).

Mead then summed up with a quote from Skidmore

v. Swift & Co., 323 U.S. 134, 140, 89 L. Ed. 124, 65S.

Ct. 161 (1944):

The weight |laccorded to an

administrative] judgment in a particular

case will depend upon the thoroughness

evident in its consideration, the validity

of its reasoning, its consistency with

earlier and later pronouncements, and all

those factors which give it power to

persuade, if lacking power te control.

6la

Applying these factors here, the Corps’ letter was

not “thorough,” nor was the “investigation” preceding

it. Nor was the letter or investigation “reasonable,”

given the manifest prejudice of the staffer principally

charged with generating the opinion and the thinness

of the inquiry. No attempt was made to perform a case-

by-case analysis as reserved by the preamble. As for

consistency, no evidence show that the letter was

consistent with other rulings. There is no evidence

that anyone with special expertise on the issue ever

touched the file. To this Court, the ruling seems

completely inconsistent with the preamble itself as to

the meaning of “excavation operations.” The Court has

carefully considered the letter and its reasoning as

well as the remedial purposes of the Clean Water Act,

finding the letter unpersuasive on the merits for all of

the reasons stated above.

The foregoing sets forth the principal findings of

fact and conclusions of law. The parties, however,

submitted findings and conclusions after trial. This

order will now approve certain of those submissions.

To the extent not inconsistent with the foregoing, this

order approves plaintiffs proposed findings of fact

numbered 3, 7-8, 11, 13, 14-15, 17-23, 25-27, 30-39, 44-

45, 47-48, 50, 53-56, 58-59, 61-74, 76-79, 81-82, and 85,

and plaintiffs proposed conclusions of law numbered

2-7, 11-19, 27, 32, 33, and 38. This order also approves

defendant’s proposed findings of fact numbered 1-2, 4,

6-7, 10, 12-15, 18, 20-21, 30, 33, 38(A)-(D), (G)-(M), (O)-

(V), (X) (but not the lead-in to No. 38), 39(A)-(B), (G)-(D

(but not the lead-in to No. 39), 41(F)-(G) (but not the

lead-in to No. 41), 43, 46, 47, 49, 53-61, 63-65, 69-70,

62a

75-77 (except during flooding), 79 (but how uniform the

layer is was not established), 85-87, 92, and

defendant’s proposed conclusions of law numbered 3

and 12. Unapproved proposals were unapproved for a

variety of reasons. For instance, some proposals were

(i) argumentative or conclusory, (11) mislea

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