Water Transfer Rule upheld by 2nd Circuit Court of Appeals

The U.S. Court of Appeals for the 2nd Circuit in a 2-1 ruling reversed a lower court finding EPA’s Clean Water Act (CWA) rule exempting the transfer of water from one basin to another from discharge permits is a reasonable interpretation of the law, and therefore should be upheld under the agency judicial deference doctrine known as Chevron. The full ruling is here. An excerpt is below:

Before: SACK, CHIN, and CARNEY, Circuit Judges.

In 2008, the United States Environmental Protection Agency promulgated the ʺWater Transfers Rule,ʺ which formalized the Agencyʹs longstanding position that water transfers are not subject to regulation under the National Pollutant Discharge Elimination System permitting program established decades ago by the Clean Water Act.  Shortly thereafter, the plaintiffs, a consortium of environmental conservation and sporting organizations and several state, provincial, and tribal governments, challenged the Water Transfers Rule by bringing suit in the United States District Court for the Southern District of New York against the Agency and its Administrator.  After a variety of persons and entities on both sides of the issue intervened, the district court (Kenneth M. Karas, Judge) granted summary judgment for the plaintiffs on the ground that the Water Transfers Rule, although entitled to deferential review under the two‐step framework established by Chevron, U.S.A., Inc. v. Natural Resources Defense Council, Inc., 467 U.S. 837 (1984), could not survive judicial scrutiny because it was based on an unreasonable interpretation of the Clean Water Act.  The district court accordingly vacated the Water Transfers Rule and remanded it to the Agency for further assessment.  We conclude that the Water Transfers Rule is based on a reasonable interpretation of the Clean Water Act and therefore entitled to Chevron deference.  Accordingly, the judgment of the district court is REVERSED.

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