Late February 15, 2024, a judge in the U.S. District Court for the District of Columbia vacated the Environmental Protection Agency’s (“EPA”) approval of Florida’s application to assume permitting under Section 404 of the Clean Water Act (“Section 404”), ending – at least for now – the state’s ability to issue permits under the federal statute. This ruling applies to all pending and future permit applications for activities in “Waters of the United States” (WOTUS) that had been assumed by the state. However, the state and EPA have ten days to seek a stay of that vacatur for those applications that won’t adversely affect federally listed species, and the Court has indicated the state may be able to retain permitting over those projects. Thus, for now, only those projects with likely effects on listed species are definitively back with the U.S. Army Corps of Engineers (ACOE). The vast majority of applications--those without species effects—are in limbo until the Court rules again on the motion for stay (when filed).

Section 404 regulates dredge and fill activities in WOTUS, and permitting of such activities is typically handled by the ACOE; however, Section 404 creates a mechanism for states to assume this permitting with EPA approval over a subset of WOTUS in the state. In December 2020, EPA approved Florida’s Section 404 Program, one of only three such programs in the country. Various environmental organizations quickly sued on procedural and substantive grounds in January 2021. Over the last three years, several rulings have been issued in the case narrowing its scope, but Friday’s ruling was the first with substantive effects on the state program.

Judge Moss vacated Florida’s Section 404 Program as violative of the Endangered Species Act (ESA). Section 7 of the ESA requires all federal agencies to consult with the U.S. Fish & Wildlife Service (FWS) and/or the National Marine Fisheries Service (NMFS) on all federal actions that may affect a listed species or its designated critical habitat to confirm that the action will not jeopardize the continued existence of the species. As part of that consultation process, the wildlife agencies must issue a Biological Opinion (BO) meeting certain criteria; the incidental take (harm, harassment, or death) of a listed species can be authorized in an Incidental Take Statement (ITS) appended to the BO if reasonable and prudent measures are incorporated to minimize impacts and various other procedural safeguards are followed. The only other mechanism to authorize the “take” of a species is through the ESA’s Section 10 permitting process.

The FWS issued a BO covering EPA’s action in approving Florida’s Section 404 Program and determined in the BO that the technical assistance process established between the Florida Department of Environmental Protection, FWS, and the Florida Fish & Wildlife Conservation Commission prevented “jeopardy” to listed species. The BO included an ITS for the program as a whole, authorizing take if permits were issued pursuant to the technical assistance process and included FWS-recommended conditions to avoid and minimize species impacts. This method of complying with the ESA was unique; Michigan and New Jersey, the only other states that have assumed the Section 404 Program, did not include blanket incidental take authorizations.

Judge Moss held that both the BO and ITS violated the ESA because of its lack of specificity; the documents failed to identify the species at issue or the amount or extent of the take and failed to set standards for determining when the authorized level of take was exceeded. Due to the scope of Florida’s Section 404 program, the judge found that the BO and ITS did not meet the demanding standards of the ESA with regard to species-specific analysis, effects analysis, or quantification of take. He vacated both the BO and ITS.

Judge Moss recognized that the majority of Section 404 permits issued by the state likely have no listed species implications and was cognizant that vacating the entire program would cause serious disruptive consequences. He therefore vacated EPA’s approval of Florida’s Section 404 program prospectively only. He also allowed the Defendants to seek a limited stay of the vacatur within 10 days of the decision, but cautioned that “[a]ny such request should exempt all pending and future permit applications that “may affect” any listed species under the jurisdiction of the FWS or the NMFS and should propose a mechanism for determining which permit applications “may affect” listed species.” In other words, applications that are not likely to adversely affect a listed species can potentially be permitted by the state rather than the ACOE. 

Permitting of all pending and future projects requiring Section 404 approval will thus revert to the federal program with the ACOE, subject to a potential stay by the Court. However, most pending applications are likely “in limbo” until the court rules on the stay. The stay, if approved, could allow the state to continue to issue permits for actions that are not likely to adversely affect listed species. How those actions will be identified has, for now, been left to the agencies to determine.  It should be noted that the Court must still rule on four counts in the Complaint, so the case is not over, and any stay granted may be temporary.