GM 15-059

Environmental Protection Agency Publishes Proposed Interpretive Rule on Tribal Eligibility for "Treatment as a State" under the Clean Water Act

On August 15, 2015, the U.S. Environmental Protection Agency (EPA) published a proposed interpretive rule in the FEDERAL REGISTER to streamline how tribes can apply for “Treatment as a State” (TAS) for the water quality standards (WQS) program and other Clean Water Act regulatory programs. 80 Fed. Reg. 47430 (copy attached). This interpretative rule would eliminate the requirement that tribes show inherent authority over nonmembers on fee lands under the so-called Montana test, a requirement which has been a major impediment to tribes attaining TAS status and adopting WQS. The interpretive rule explains EPA’s revised interpretation of the statutory requirements in the CWA and does not propose any changes in the existing regulatory language relating to applications for TAS. EPA invites comments on this proposal, even though, as an interpretive rule, it is not subject to notice and comment rulemaking under the Administrative Procedure Act. The deadline for filing comments is October 6, 2015.

The interpretive rule would reinterpret Section 518 of the Clean Water Act (CWA) as a delegation of authority by Congress to eligible tribes to administer CWA regulatory programs over their entire reservations. Tribes and tribal organization have been seeking this proposed reinterpretation for many years. Under EPA’s current interpretation, only 40 of over 300 federally recognized tribes with reservations have been approved to be treated in the same manner as a state for adopting tribal WQS.

This proposed interpretation is a very significant shift away from the approach EPA adopted in 1991 when it promulgated final regulations for the WQS program, which require each applicant tribe to include a statement describing the basis for its assertion of authority. EPA’s interpretation of this regulatory requirement, as explained in the preamble of the rulemaking document, requires that a tribe seeking TAS to administer the WQS on lands owned by nonmembers of the tribe demonstrate inherent authority to regulate non-tribal members under principles of federal Indian common law, especially Montana v. United States, 450 U.S. 544 (1981). In Montana, the Supreme Court announced a proposition that, absent a delegation of federal authority, tribes generally lack inherent sovereignty over nonmembers on fee lands, but the Court also formulated two exceptions in which tribes may retain inherent civil jurisdiction over nonmembers. The second exception, which EPA considered relevant for tribal authority for CWA regulatory programs, provides that tribes may retain inherent civil authority where nonmember “conduct threatens or has some direct effect on the political integrity, the economic security, or the health and welfare of the tribe.”

EPA took a different approach in implementing the TAS provisions of the Clean Air Act (CAA) as amended in 1990. In its 1998 CAA TAS final rule, EPA determined that Congress had delegated authority to tribes to regulate all sources within reservation boundaries. That interpretation rendered the Montana test inapplicable. The proposed reinterpretation of the CWA would bring TAS under the CWA in line with EPA’s treatment of tribes under the CAA.

In explaining its proposed reinterpretation, EPA recalled that, in the 1991 rulemaking, it had considered the question of whether CWA section 518 was a delegation of authority to tribes. After noting that an opinion by four Supreme Court justices cited section 518 as an example of delegation and that some legislative history supported a finding of such congressional intent, EPA found that the support for delegation was not sufficiently definitive. EPA wrote that it considered the question “not resolved” and that EPA would be willing to revisit the issue if further congressional or judicial guidance indicates that section 518 is properly interpreted as an express congressional delegation of authority.

EPA’s approvals of TAS for CWA regulatory programs have been challenged several times, and in each case the reviewing court upheld EPA’s determination. In its proposed reinterpretation, EPA notes that the first federal court to rule on a challenge to a CWA TAS determination analyzed CWA section 518 and concluded that it does provide tribes with delegated regulatory authority over their entire reservations, although that question was not an issue to be decided in the case. EPA also cites the TAS provisions in section 301(d) of the CAA as additional relevant insight into congressional intent, with language that was enacted in 1990, only three years after Congress enacted section 518 of the CWA. When EPA finalized its TAS regulations implementing section 301(d) of the CAA in 1998, it concluded that Congress had intended to delegate regulatory authority to eligible tribes over all sources “within the exterior boundaries of the reservation.” In its proposed reinterpretation, EPA notes that similar to the CAA, CWA section 518 provides eligibility for tribal programs covering water resources “within the borders of an Indian reservation” and cites the definition of “federal Indian reservation” in section 518(h) of the CWA as including all land within the limits of a reservation. In light of these developments and the experience to date in which the TAS application process has become much more burdensome than EPA anticipated in 1991, EPA now proposes to reinterpret CWA section 518.

Please let us know if we may provide additional information regarding this very important EPA proposed interpretive rule or if you would like assistance in preparing comments.