ARA Regulatory Update: A Pollution Diet for the Gulf of Mexico?
These lawsuits represent an effort by the Coalition to use EPA’s broad authority to regulate water quality under the CWA as a means of regulating agricultural operations, many of which are exempt from CWA’s pollutant discharge permitting scheme. Farmers throughout the Mississippi River watershed are increasingly concerned that a settlement agreement or Coalition victory could have a significant impact on their bottom line.
This is not the first time environmental groups have sought increased regulation of nutrients under the CWA. Following lawsuits brought in 1997 by the American Canoe Association, the American Littoral Association and others, EPA set an 11-year schedule for establishing a total maximum daily load (TMDL) for nutrients in the Chesapeake Bay. That standard, which was established in 2010, may offer some insight into the potential consequences of a “pollution diet” for the Gulf of Mexico.
The Chesapeake Bay TMDL—the largest ever developed by EPA—sets a maximum annual amount of nitrogen, phosphorous and sediment that can enter the bay from each river and jurisdiction, and also assigns pollutant loads specifically for the agricultural sector. States and municipalities in the Chesapeake watershed were required to develop watershed implementation plans (WIPs) with enforceable strategies to meet the TMDLs, subject to EPA penalties for noncompliance.
The projected impacts of this TMDL are significant. EPA itself estimates that 20 percent of cropped land in the Chesapeake watershed (about 600,000 acres) will have to be removed from production and converted to grassland or forest in order to achieve the required loading reductions. Moreover, farmers will be required to implement and build upon existing management practices—such as nutrient management planning, use of cover crops, continuous no-till farming and livestock stream exclusion—in order to achieve EPA’s cleanup goals, at a substantial operational and maintenance cost. In Virginia, to take just one example, the estimated cost for the agricultural sector to comply with the state’s WIP will be more than $1 billion. For farmers who operate with thin profit margins, this added expense could prove difficult to bear.
Beyond these costs, the Chesapeake Bay TMDL has also created substantial regulatory uncertainty for farmers in the watershed. The prospect of far-reaching federal regulation was recently signaled by Executive Order 13508, which President Obama issued in May 2009. The order calls for the federal government to lead a renewed effort to restore the Chesapeake Bay and its watershed. In response, EPA established an accountability framework in December 2009 for each of the six watershed states and the District of Columbia to meet the TMDL goals. EPA specifically stated that if the jurisdictions did not develop WIPs, identify two-year milestone commitments and/or fulfill those commitments consistent with its expectations, EPA would take “appropriate independent actions or consequences”—expanding NPDES permit coverage to currently unregulated sources; incorporating specific nutrient reduction management practices into NPDES permits; increasing oversight of state permit issuance; increasing federal enforcement and compliance; prohibiting new or expanded pollution discharges; discounting nutrient and sediment reduction progress; and conditioning or redirecting EPA grants, among the possible actions. This regulatory threat has had a chilling effect on agricultural investment and production in the watershed. Not surprisingly, the American Farm Bureau Federation and others have filed suit challenging the TMDL as exceeding EPA’s authority under the CWA.