Congress is stuck on rewriting permit rules. SCOTUS brought its wrecking ball.

Congress spent months obsessing over an effort to loosen the rules on federal environmental permits — only for the Supreme Court to eclipse its efforts in a single morning.

The court’s May 25 decision shrinking federal wetlands protections took a wrecking ball to an expansive permitting regime that has been in place for nearly 50 years ― and it’s already having a ripple effect in how agencies enforce a wide range of other environmental safeguards. The 5-4 ruling put at least half the country’s marshes, swamps and other wetlands outside the reach of federal water protections, an outcome that could speed the way for pipelines, power lines, highways and housing projects across the U.S.

The justices announced their decision as House Republicans and the White House were struggling to close a deal to lift the nation’s debt-ceiling, a drama-filled exercise that GOP lawmakers and some Democrats had hoped to leverage to hasten permit approvals for energy projects. The final legislation made only modest tweaks to permitting rules, leaving lawmakers to express hopes of reaching a grander bargain before the 2024 elections.

In contrast, the court’s ruling in Sackett v. EPA delivered a win for an array of industries, legal experts say — and it may enable many projects to avoid federal scrutiny altogether. The decision showcased yet again the power of the court’s conservative majority to make sweeping changes to federal policy at a time when close partisan splits in the House and Senate hamper Congress’ ability to act.

“Sackett is not a Promised Land. It didn’t clear up everything. But boy did it clear up a lot,” said Molly Cagle, senior counsel at the law firm Baker Botts who advises infrastructure developers on permitting.

The court decision addressed what has been one of the biggest regulatory hurdles for a wide range of projects: obtaining a Clean Water Act permit to fill in streams and wetlands.

The ruling stripped Clean Water Act protections from wetlands that lack a “continuous” surface water connection to larger streams, lakes and rivers — a much narrower interpretation of the law than either the Supreme Court or even the Trump administration had applied before. Conservative Justice Brett Kavanaugh joined the court’s three liberals in objecting to that outcome, accusing the majority of “rewriting” Congress’ words.

Now, legal experts say, hundreds of projects will probably no longer need Clean Water Act permits at all. Other projects will still have to go through the water permitting process, but will likely face far fewer requirements to either lessen their impacts on wetlands or pay for rebuilding wetlands elsewhere.

The ruling could also limit the ability of Democratic-led states to use their authority under the 1972 water law to block energy infrastructure, as states like New York and Washington have done in recent years with natural gas pipelines and a coal export terminal.

Before the ruling, even relatively minor development projects like highway off-ramps had to go through the complex and time-consuming wetlands permitting regime, said Cagle, who works in Baker Botts’ Austin office.

“Anything you want to build that’s more than one-eighth of an acre — you want to build a shopping center, you want to build a highway — anything bigger than a breadbox that you historically wanted to put on God’s green Earth, you had to do a wetland delineation. You may not have to anymore,” she said.

The Biden administration is still deciding how it will implement the court’s decision. EPA did not respond to a request for comment but has previously said it is reviewing the ruling. The Army Corps of Engineers has temporarily halted wetland reviews nationwide as the agencies “consider next steps,” a spokesperson said.

But a now-defunct 2020 Trump administration wetlands regulation offers a preview of the effect the ruling may have.

The Trump-era rule, which did not go as far as the high court’s new decision in reducing federal authority, cut in half the number of wetlands that fell under the law and resulted in more than 300 projects no longer requiring a permit. Those projects included solar farms, energy pipelines, residential developments and mines.

For instance, developers of a long-battled-over copper and critical minerals mine outside Tucson, Ariz., abandoned their Clean Water Act permit and began construction after the Trump rule went into effect, because the Army Corps of Engineers found the area to contain no federally protected waters under the narrower definition.

A 135-mile pipeline carrying natural gas across southeast New Mexico and west Texas was able to forgo water permitting entirely. That’s because the multiple desert streams it crosses typically flow only during the region’s rainy season, which means they weren’t subject to federal permitting under the Trump rule.

The new Supreme Court ruling, like the Trump rule, is likely to have the greatest impact in the arid West, where many wetlands typically do not have a continuous surface connection to federally protected water bodies. The ruling also calls into question whether desert streams that depend on rain — which make up the vast majority of waterways in Arizona, New Mexico, Nevada and Utah — fall under the scope of the law.

But the effects of the Trump-era rule weren’t limited to the Western side of the Mississippi River, showing that the Supreme Court’s new ruling is likewise poised to have ramifications across the country.

For instance, developers of a sprawling strip mine on the edges of Georgia’s Okefenokee Swamp won a determination that their project seeking to unearth titanium and zirconium from underneath hundreds of acres of wetlands wasn’t subject to federal permitting under the Trump rule. 

Now, under the high court’s new ruling, even massive refineries and other petrochemical facilities in southeast Louisiana, where wetlands provide vital storm protection, may be able to avoid federal water permitting because levees separate wetlands on their property from the Mississippi River.

If project developers can design their plans in a way that avoids federally protected wetlands, not only would that absolve them of the need for a Clean Water Act permit, but in many cases it could also allow them to forgo environmental review under the National Environmental Policy Act.

That half-century-old law requires that the government lay out the environmental and social consequences of major federal actions and analyze alternative approaches that could be less damaging. It also provides a key mechanism for communities to understand and weigh in on projects affecting them.

But developers and Republicans have long bemoaned the time and expense that the NEPA process can add to projects, and have made “streamlining” its requirements a top priority, including in negotiations over raising the debt ceiling.

Now, some projects may be able to avoid that process entirely. For renewable energy farms, residential and industrial facilities, state highways and even oil pipelines, federal water permits were often the only federal decision triggering NEPA. For instance, with the sprawling Georgia titanium mine, the Clean Water Act permit was the only federal action making NEPA review necessary, said Nick Torrey, a senior attorney with the Southern Environmental Law Center, which has been battling the project.

Avoiding both water permitting and NEPA review could substantially speed up the process for those infrastructure projects and greatly reduce the cost — but it also removes legal tools that communities and environmental groups have used to challenge projects.

“As you dramatically cut back the jurisdiction of the Clean Water Act, it definitely hinders the ability of local citizen community groups to help enforce the law and have a voice,” Torrey said.

Torrey argued that the Supreme Court’s shrinking of federal wetlands jurisdiction will compound the changes to NEPA that Congress included in the debt ceiling bill. In addition to limiting the length of environmental reviews, that legislation also means that some actions such as federal loan guarantees no longer trigger NEPA, and the deal codified a narrower range of effects that environmental reviews must contemplate.

Attorneys say smaller projects will most easily avoid NEPA review as a result of the wetlands decision. Even if larger projects can avoid damaging federally protected waters now, they’re likely to involve other federal actions that trigger NEPA review, said Chris Thomas, partner at Perkins Coie’s Phoenix office who led the mining industry’s friend-of-the court brief in the Sackett case.

While the West may now have fewer federally protected waters to worry about, it still has a lot of federal land, he noted.

The narrowing of federally protected waterways also stands to limit states’ ability to reject or condition permits using their authority under the 1972 water law. If projects no longer need Clean Water Act permits, states won’t get a chance to weigh in at all. And for those that do still require permits, a separate Trump-era regulation limits the kinds of environmental harm that states can consider when deciding whether to approve or reject a project, said Dave Owen, an environmental law professor at the University of California.

The shrinking of federal water protections could benefit large electrical transmission projects, a top priority for Democrats who want to hook massive quantities of renewable energy into the grid. But the Supreme Court decision does nothing to allay the cost issues and local objections that have primarily hindered those projects.