In what may be its first opportunity to test the waters of federal agency influence after the fall of Chevron deference, on October 16, 2024, the Supreme Court heard arguments in City and County of San Francisco v. Environmental Protection Agency. This case comes to the Court after a divided Ninth Circuit panel rejected a challenge to the EPA’s authority to enforce the Clean Water Act (“CWA” or the “Act”), 33 U.S.C. § 1251 et seq., through “general narrative prohibitions” spelled out in permits issued under the EPA’s National Pollutant Discharge Elimination System (“NPDES”) permitting program.

As background, the CWA is a comprehensive water quality statute intended to protect the “integrity of the Nation’s waters.”  33 U.S.C. § 1251(a).  Subject to certain exceptions, the Act prohibits “the discharge of any pollutant by any person.”  33 U.S.C. § 1311(a).  One such exception, the NPDES’ permitting program, allows the EPA to issue a permit for the discharge of pollutants so long as that discharge meets CWA requirements that the EPA spells out on the permit itself.  33 U.S.C. § 1342(a)(1).

Here, San Francisco unsuccessfully challenged a 2019 NPDES permit (“Permit”) regulating the discharge from a sewage and stormwater treatment facility with the EPA’s Environmental Appeals Board. The Permit included generic narrative provisions, such as a requirement that discharge may “not cause or contribute to a violation of any applicable water quality standard.” San Francisco argued this was improper, as the EPA may not condition San Francisco’s compliance with discharge requirements on the overall quality of the receiving waters rather than the contents of the discharge itself. San Francisco sought review by the Supreme Court after a split Ninth Circuit panel denied review of the EPA Board’s determination, holding that the CWA and its implementing regulations give the EPA broad authority to ensure the discharger’s adherence to any applicable water quality standard and to create limitations necessary to satisfy narrative criteria for water quality beyond effluent limitations.

The question before the Court is: “Whether the Clean Water Act allows EPA (or an authorized State) to impose generic prohibitions in NPDES permits that subject permitholders to enforcement for exceedances of water quality standards without identifying specific limits to which their discharges must conform.” San Francisco primarily argues that the CWA’s instruction that the EPA set “effluent limitations,” defined as restrictions on the quality of constituents “discharged from point sources,” precludes the agency from imposing generic narrative permit requirements that condition compliance on receiving water quality.

During oral argument, the Court appeared to lean toward San Francisco’s argument. Chief Justice Roberts and Justice Kavanaugh raised concerns that the permitting system, which may impose fines and even prison sentences, is intended to provide notice of environmental obligations ahead of time, which generic narrative prohibitions may not provide. Justice Gorsuch characterized such generic prohibitions as the equivalent of telling permitholders to “go forth, and do good,” and questioned whether such requirements create any meaningful limitations on what permitholders discharge. Justice Kagan, however, questioned whether anything in the CWA’s text prohibits the EPA from relying on generic narrative limitations. Justice Sotomayor also lamented on the value of generic narrative standards, indicating that they are flexible enough to encompass environmental issues not expressly accounted for in a permit. She also raised the concern that, if the EPA were to restrict its permits to specific quantifiable limitations, dischargers might argue the permits are too “long and convoluted.”

This case may be the first significant test for administrative agency power since the Supreme Court’s decision last term in Loper Bright Enterprises v. Raimondo, which eliminated judicial deference formerly paid to government agencies’ interpretations of the statutes they are tasked with enforcing. Indeed, in their briefing, both parties argued under Loper that the Court should seek guidance from the EPA’s interpretation of the CWA rather than deferring to those interpretations, as was the former standard under Chevron. Thus, aside from affecting entities dealing with environmental concerns, the Court’s decision may further refine the role that administrative agencies play in interpreting statutory law moving forward.

For more information, please contact Chantel Febus, James Azadian, Grant Gilezan, Mark Jacobs, Mark Magyar, Kyle Asher, Susan Feibus, Christopher Sakauye, Monika Harris, or Ryan VanOver.