Loyola University of Chicago School of Law, JD 2022
On July 15, 2021, the Hawaii’ federal district court became the first court to publish an opinion utilizing the functional equivalent analysis (“FEA”) established by the Supreme Court of the United States last year in the County of Maui v. Hawaii’ Wildlife Fund (2020). The analysis is used to determine whether a facility which discharges a pollutant into groundwater which flows into U.S. waters must obtain a National Pollution Discharge Elimination System (“NPDES”) permit under Section 402 of the Clean Water Act (hereinafter “Section 402”). The ruling, which found that the Lahaina Wastewater Reclamation Facility must obtain a NPDES permit for its discharge, is the first glimpse at how courts will apply the FEA and will serve as reference point for future cases.
The NPDES permit program and the Supreme Court’s FEA analysis
To understand the district court’s analysis, one must first understand the regulatory framework of the NPDES permit program and the role of the FEA analysis as a part of that framework. The NPDES permit program is the mechanism employed by Section 402 to regulate the discharge of pollutants from point sources into navigable waters of the United States. Facilities which discharge pollutants from a point source into U.S. waters as defined under this section are required to get a NPDES permit, and failure to do so constitutes a violation of the Clean Water Act. A more in-depth overview of the program can be found in my previous blog regarding the case.
Until the Supreme Court’s ruling in County of Maui v. Hawaii’ Wildlife Fund (2020), the NPDES permit program was only required for pollutants which were discharged directly from a point source into U.S. waters. The Court’s ruling expanded the application of the NPDES program to include direct discharge from a point source or the “functional equivalent” of indirect discharge. The Court outlined a non-exhaustive list of seven factors that it found relevant to the determination which it labeled the “functional equivalent” analysis (“FEA”) to be conducted on a case-by-case basis. The Court emphasized that two of these factors, the time and distance traveled by the discharged contaminants before entering navigable waters, will be the most important in most cases, but not necessarily every case.
The FEA and the Lahaina Wastewater Reclamation Facility
The Hawaii’ federal district court’s application of the FEA analysis to the Lahaina Wastewater Reclamation Facility (“LWRF”) is the first such application, and as such, the court’s analysis of the factors serves as a case study for its regulatory impact. After weighing the Supreme Court’s factors as well as an additional factor it deemed relevant, the volume of contaminants discharged into navigable waters, the district court concluded the Lahaina facility was required to obtain a NPDES permit, with four factors favoring requiring a permit, two favoring not requiring a permit, and one deemed insignificant in this case.
Significantly, the district court found that both the time and distance factors weighed in favor of requiring a permit. In analyzing both factors, the district court used extreme examples discussed in the Supreme Court’s opinion as a reference point: (1) regarding the time traveled, seconds or minutes for a pipe a few yards away on the low side, up to many years on the high side, and (2) regarding distance traveled, as low as several yards up to as much as fifty miles away. Based on an EPA study, the transit time of the discharge from LWRF took as little to eighty-four days in some instances, with the average transit time being between fourteen and sixteen months, and the distance traveled was between half a mile to one and half miles. The fifth factor also favored regulation, noting the agreement between the parties that 100 percent of the wastewater reached the ocean. Notably, the fact that the pollutant is diluted was found to be insignificant since the pollutants were still present, and under the same reasoning the court concluded that the water maintained its specific identity as polluted water, concluding that this factor weighed in favor of requiring a permit as well.
The district court did find that the third and fourth factors did not favor requiring a permit since the pollutant travels through volcanic rock below an aquifer and mixes with saline, brackish and fresh groundwater, diluting it with an average eighty-six percent reduction in nitrogen levels. The court found the sixth factor insignificant in this case because the exact manner by which the pollutant entered U.S. waters was unclear.
The district court also considered an additional factor of its own — the volume of wastewater that reached navigable waters. The LWRF puts between 3 and 5 million gallons of wastewater into four injection wells per day, which is then discharged into a groundwater aquifer 200 feet below ground. Once there, LWRF concedes that 100 percent of that wastewater makes its way into the Pacific Ocean through the groundwater, traveling approximately half a mile. The district court concluded this to be in favor of requiring a permit.
The impact of the district court’s application of the FEA
Based on the Hawaii’ district court’s application of the FEA, the regulatory impact of the Clean Water Act’s NPDES permit program is going to increase significantly as its applicability expands to a breadth of facilities that had been out of its reach prior to County of Maui (2020). Based on the district court’s reliance on the examples used by the Supreme Court in its ruling, it is likely that a travel time of multiple years or a travel distance of multiple miles could leave a facility subject to the permit requirement. Given that these factors are given the most weight, this vastly expands the regulatory strength of the CWA. The court also downplayed the significance of the dilution of the pollutant during its travel, making unlikely that factor will sway a court. While the additional factor considered by the district court is relevant to the analysis, it illustrates the issue of uncertainty facing facilities trying to determine if this new FEA requires their facilities to apply for a permit, since they don’t know what additional factors a reviewing court might consider. Ultimately, this ruling is a victory for those in favor of stronger environmental regulations.