August 30, 2017

Adverse decision in Alaska wetlands case

By Damien M. Schiff Senior Attorney

This morning, the Ninth Circuit upheld the Army Corps of Engineers’ Clean Water Act jurisdiction over the Fairbanks, Alaska, property of our client, Universal Welding. The case, Universal Welding & Fabrication Co. v. United States Army Corps of Engineers, addressed a rarely invoked exception to the agency’s Clean Water Act jurisdiction over wetlands. The Corps’ regulations provide that the agency can regulate all wetlands adjacent to other jurisdictional waters, except wetlands that are adjacent to other jurisdictional wetlands. In our case, Universal Welding’s property is bordered by a county road, on the other side of which is a large wetland that extends for about a mile-and-a-half to Drainage Channel C, a tributary of the Chena Slough and Chena River. We argued that Universal Welding’s 14 acres of low-functioning wetlands were at most adjacent to the large wetland on the other side of the road. That made the two sets of wetlands adjacent to each other and thereby qualified our client’s property for the exception. Towards the end of the administrative process preceding our lawsuit, the Corps actually agreed that the exception applied. But then EPA intervened and “elevated” the matter and—surprise—executed a jurisdictional volte-face, concluding that our client’s wetlands were adjacent to the non-wetland Channel C regardless of the intervening wetland. One might call this the “leap-frog” recapture interpretation.

But whatever one calls it, the Ninth Circuit liked it. The Court’s decision explains that, under principles of judicial deference to agency interpretation, the Court must defer to the Corps’ interpretation of its own regulations, even if a better interpretation is available. And, as a bit of jurisprudential salt in the legal wound, the Court added for good measure that our interpretation would have lost anyway, even without deference.

Today’s decision, although disappointing, may however prove to be of limited influence, given the Court’s decision not to publish it. That means that it is not precedential, and lower courts in the Ninth Circuit will not be bound by it.

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Universal Welding, Inc. v. U.S. Army Corps of Engineers

The Clean Water Act gives the Army Corps of Engineers jurisdiction over wetlands, including wetlands that are adjacent to other jurisdictional waters such as navigable rivers or lakes. The law does not give the Corps jurisdiction over wetlands that are adjacent to other wetlands. Universal Welding is a family-owned steel and pipe fabrication business based in North Pole, Alaska. When it sought to expand its operations on a neighboring parcel that contains some isolated wetlands, the Corps stepped in and demanded multiple onerous conditions and a $70,000 “mitigation fee” to be paid to The Conservation Fund. Universal Welding is challenging the Corps’ ability to impose any conditions because it lacks jurisdiction over this parcel, which is not adjacent to any navigable waters, but only to other wetlands.

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