The Federal government has incrementally extended its control over agricultural lands during the past forty years,1 by expanding the definition of “waters of the US” (WOTUS) under the Clean Water Act (CWA) and asserting broad legal jurisdiction over WOTUS-adjacent “wetlands.” Such activities have triggered Congressional investigations2 and significant public litigation. They also have facilitated the CWA’s growth into a “regulatory hydra” and caused a “reversal of terms [in our unique relationship with government] that is worthy of Alice in Wonderland.”3
During this past February, President Trump issued Executive Order 137784 in an initial effort to curtail this government juggernaut which disregards constitutionally protected private property rights in furtherance of wetlands protection. The EO directs the heads of the U.S. Environmental Protection Agency (“EPA”) and the Army Corps of Engineers (“the Corps”) to review for substantial revision or rescission their jointly issued 2015 CWA regulation which expands the “WOTUS” rule and narrows its “normal farming activities” exemption.5 Presumably, EPA’s review of this regulation will be undertaken while the October 9, 2015 federal court-issued stay of its implementation remains in place.6
The Obama administration regulation inter alia treats all “wetlands” adjacent to WOTUS as “jurisdictional waters” for purposes of enforcing CWA’s controversial Section 404 (dredge and fill permitting requirements). It does so by dispensing with the traditional case-by-case evaluations used to determine if jurisdiction applies to specific delineated wetlands.7 Although this regulation also states that the longstanding “prior converted cropland” (“PCC”) exclusion from WOTUS jurisdiction will be upheld,8 this result is not certain, and can be assured only through active ongoing White House oversight.
In addition to CWA Section 404, Congress also enacted the Food Security Act of 1985 (“FSA”)9 to provide greater protection of our nation’s wetlands.10 The FSA’s Title XII “Swampbuster” provision11 helped wetland conservation efforts by limiting and eventually denying U.S. Department of Agriculture Soil Conservation Service (“USDA-SCS”) funding to those who commenced conversion of wetlands to croplands after December 23, 1985. PCCs, which are defined by reference to the USDA-SCS’s 1988 National Food Security Act Manual (“NFSAM”), however, are exempt from and not subject to the FSA’s Swampbuster provision.12
PCCs are wetlands that had, prior to December 23, 1985, commenced being drained, dredged, filled, leveled, or otherwise manipulated for the purpose or effect of making the production of an agricultural commodity possible, where such production would not have been possible but for such action, and before such action such land was wetland and neither highly erodible land nor highly erodible cropland.13 The NFSAM added three conditions to secure PCC status. First, the agricultural commodity must have been planted at least once prior to December 23, 1985. Second, the area must not have been “abandoned.”14 The NFSAM defined abandonment as “the cessation of cropping, management, or maintenance operations on prior converted croplands,” including “repair of drainage system” (emphasis added).15 It considered a PCC abandoned “if wetland criteria are present and” the PCC “has not been used, managed or maintained for cropping purposes for 5 successive years, and was not enrolled in a USDA [...] program of conserving use or wetland restoration” (emphasis added).16 Third, the NFSAM deemed a wetland conversion “commenced” if “any of the construction activities including flood water reductions that would convert [a] wetland were actually started,” or substantial funds had been expended or legally committed for the direct purpose of converting the wetland.17 As long as the USDA Farm Services Agency had issued a commenced conversion determination by September 19, 1988 designating that “commenced” activities had begun before December 23, 1985, the NFSAM and subsequent USDA regulations provided that conversion activities could be completed up until January 1, 199518 without compromising PCC status.
During the late 1980s and the early 1990s, the EPA and the Corps disagreed over whether PCCs the USDA-SCS deemed as exempt from and not covered by the FSA were also to be excluded from WOTUS and CWA Section 404 jurisdictional coverage. The Corps issued regulatory guidance (RG-90-07) granting PCCs an exclusion from CWA Section 404 jurisdictional coverage in September 1990,19 having determined that PCCs were sufficiently physically transformed from former wetlands into drylands capable of and supporting continued actual agricultural use for crop production and/or pasturing (forage) such that they no longer satisfied the three-factor definition of “wetlands” found in the Corps’ 1987 Wetlands Delineation Manual.20 EPA, meanwhile, took several years longer to move in that direction, having embraced a more expansive definition of “wetlands” contained in its 1988 wetland Identification and Delineation Manual,21 thereafter incorporated into the controversial 1989 interagency “Federal Manual for Identifying and Delineating Jurisdictional Wetlands”22 which no longer is officially followed.23
During this period of regulatory confusion and uncertainty, EPA continued to aggressively impose its CWA Section 404 jurisdiction over agricultural wetlands, irrespective of whether the Corps had treated PCCs as excluded from WOTUS and CWA 404 coverage.24 Consequently, many small and medium-sized farms and ranches, including my clients’ Erie, Pennsylvania family farm, were rendered unprofitable and/or driven out of business. Indeed, EPA had refused to recognize the Brace farm’s 1988 PCC status and exclusion from CWA Section 404 jurisdiction. EPA also had effectively compelled my clients to prove (unsuccessfully) in a federal lawsuit25 that their farming operations qualified under the “normal farming activities” exemption of CWA Section 404(f)(1) (which EPA construed very narrowly),26 and escaped “recapture” under CWA Section 404(f)(2) (which EPA construed very broadly).27EPA first recognized PCCs as excluded from WOTUS and CWA Section 404 jurisdictional coverage in nonbinding 1992 agency fact sheets.28 However, it finally accepted this interpretation following the White House Office on Environmental Policy’s August 1993 release of the Clinton administration’s wetlands policy.29 The Clinton wetlands policy acknowledged the regulatory burdens the inconsistent and conflicting CWA and FSA wetlands protection programs had placed on American farmers. To relieve such burdens, it ensured that EPA and the Corps would soon thereafter jointly issue a regulation treating PCCs excluded from coverage under FSA’s Swampbuster provision as also excluded from the definition of WOTUS and CWA Section 404 regulatory jurisdiction.30 The August 1993 joint EPA-Corps regulation effectively codified the Corps’ then-current regulatory policy (RG-90-07) that PCCs, as defined by the NFSAM, were not WOTUS covered under CWA Section 404, thereby amending the definition of WOTUS.31
If the history of the EPA’s prior disregard for the PCC exclusion and its exploitation of the normal farming activities exemption at farmers’ expense is any judge, the Trump administration’s goal of revising the Obama WOTUS rule will not be easily realized. For example, the 2008 Transition to Green report issued by the who’s who of environmental activist groups prior to the inauguration of former President Obama,32 recommended that EPA, together with the Corps and the U.S. Department of Justice’s Environment and Natural Resources Division (“USDOJ-ENRD”), doggedly “pursue wetlands enforcement litigation to the maximum extent permitted by Supreme Court precedent,” to “revitalize enforcement of clean water laws with a focus on wetlands protection and restoration,” and to establish a toll-free anonymous tip line to report Swampbuster [...] violations (emphasis added).33 In addition, the 2016 report of the Senate Committee on Environment and Public Works, which confirms these recommendations became agency practice, reveals that “the assurances given by EPA and the Corps regarding the scope of the WOTUS rule and its exemptions to the positions taken by these agencies in jurisdictional determinations and in litigation are[/were] factually false” (emphasis added).34
Furthermore, the Corps as well as EPA must be carefully monitored. Although the NFSAM, the 1993 EPA-Corps joint regulations, and the 1996 USDA regulations consistently defining PCC status (including with respect to “abandonment”) had been widely interpreted as saying “once a [PCC] always a [PCC],”35 the Corps, in 2009, surreptitiously endeavored to change this policy. It did so by following the position taken in an Army Corps Field Office Issue Paper, later affirmed in a Regional Corps Commander’s Memorandum (collectively referred to as the “Stockton Rules”), which concluded that a switch in land use from agricultural to nonagricultural use triggered “abandonment” of agricultural activity and loss of PCC status. While a Florida Federal District Court, in 2013, found the Stockton Rules to constitute final agency action, it held the national implementation of such rules invalid because the Corps had failed to utilize “appropriate notice-and-comment” procedures required by the Administrative Procedure Act.36
Moreover, the persistent harassment of my clients by EPA and the Corps, since 2009, provides even more evidence of agency wetlands recidivism. In fact, on January 9, 2017, only 11 days prior to President Trump’s inauguration, EPA filed two new lawsuits against the Brace family farm. They allege CWA Section 404 permitting violations for activities undertaken on two contiguous and adjacent farm fields/properties otherwise qualifying for the PCC exclusion from WOTUS and CWA 404 jurisdiction. The aim of one suit is to enforce alleged violations of an ambiguous 21-year-old wetlands consent decree covering one such parcel, while the likely objective of the other suit is to secure and enforce a more defined and restrictive wetlands consent dec37ree to cover the second, and perhaps, a third contiguous parcel.
In sum, if the Trump administration is truly serious about substantially rewriting the Obama WOTUS rule and bringing a rogue EPA (and Army Corps) bureaucracy to heel, ongoing White House oversight and supervision of EPA wetlands-related rulemaking and enforcement will be indispensable.38
However, aggressive EPA rulemaking and overenforcement is not the only major threat posed to the livelihood of small and medium-sized American family farms. Based on this author’s experience, U.S. agricultural production is also placed at risk by misguided environmental and wildlife activist-led39 Interior Department fish-first (i.e., Endangered Species Act (“ESA”)40 and tribal trust policy-based41) water reallocation schemes. Negotiated with the federal government as a fiduciary party in interest, and implemented on either a regional, interstate or intrastate basis, these schemes bypass state-recognized prior appropriated water rights42 to severely reduce access to available irrigation water,43 resulting in diminished crop harvests, thinned cattle herds, and decreased farmer/rancher profits.44 Together, these overzealous federal agency rulemaking and enforcement practices help to shrink the U.S. agriculture labor pool45 and trade surplus,46 which only further compromises U.S. national food security and raises the likelihood that Americans will increasingly depend on unsafe and unsecure third world food imports47 to make up the difference.
It would appear from President Trump’s most recently issued Executive Order “Promoting Agriculture and Rural Prosperity in America,”48 the goals of which inter alia include regulatory revision, promoting rural economic prosperity and preserving family farms,49 that he gets the point quite clearly. This E.O. mandates an interagency regulatory review process which is to be coordinated with the agency regulatory reviews mandated by E.O. 13778 discussed above50 and E.O. 13771.51 If this effort creates the necessary synergies that can actually secure reductions in the costs and burdens associated with both agricultural and environmental regulations,52 then perhaps the President’s campaign pledge to protect agricultural sector jobs and national security may be realized. Since E.O. 13771 does not apply to EPA, which is an independent regulatory agency,53 while E.O. 13778 does,54 it remains questionable how much progress can truly be achieved.
Presumably, the White House will embark upon this endeavor prior to commencing an agricultural trade war with our neighbor to the north. Washington lobbyists representing large U.S. dairy producers the exports of which are being undercut by lower cost protectionist-inspired Canadian protein processing rules, have called upon the President to act immediately.55 No doubt, there is an urgent need to curtail foreign disguised regulatory trade barriers that harm U.S. agricultural exports.56 Nevertheless, U.S. domestic agriculture, wildlife and environmental regulations have, since 2009, steadily incorporated unscientific international law standards57 contributing significantly to the economic pain now being experienced by dairy and other farmers. Were the President to first successfully address U.S. federal agency regulatory and enforcement impositions—of the type discussed above—on Americans’ economic freedom58, he would surely initiate his success as the leader of the free world.
* Lawrence A. Kogan is Managing Principal of The Kogan Law Group, P.C. New York, New York and President of the Princeton, NJ-based nonprofit Institute for Trade, Standards and Sustainable Development. Mr. Kogan currently serves as defense counsel representing the Brace family in EPA-re-initiated litigation, and as counsel to the Siskiyou County Water Users Association. He recently served on the Trump Agency Landing Team for the Office of United States Trade Representative, and formerly served as the legal representative of the Klamath Irrigation District, the County of Siskiyou, California, and a small group of farmers operating in the Flathead Irrigation Project located on the Flathead Indian Reservation in northwestern Montana.
Lawrence Kogan recently served as special counsel to the Klamath Irrigation District where he was tasked, in part, with generally addressing Klamath Basin Agreement matters. Mr. Kogan also recently served as special counsel to Siskiyou County addressing Amended KHSA matters. He is managing principal of the Kogan Law Group, P.C. of New York, NY
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