Water Quality and Supply

State and federal officials move forward plans and policies for water conservation, conveyance, and climate resilience.

By Michael G. Romey, Lucas I. Quass, John Detrich, Cody M. Kermanian, and Julie Miles

The winter of 2022-23 brought historic levels of precipitation to California after years of deep drought, dwindling reservoirs, and groundwater depletion. In the first quarter of 2023, most of the state received rainfall exceeding historic averages, with some areas experiencing 200%, or even 300% of average levels. According to the US Drought Monitor, the state is currently drought-free, although some regions are still considered abnormally dry. Despite heavy precipitation over the past year, California’s drought resilience remains in question, as critical infrastructure projects face staunch opposition and climate change increases the likelihood of extreme and prolonged droughts. Regulators and water managers had a busy 2023 as they grappled with persistently low groundwater levels, planned for additional water storage and conveyance, and continued to advance water conservation initiatives.

This blog post summarizes key actions taken by state and federal officials in 2023 with respect to California’s water supply and provides an outlook for 2024.

The Court’s decision has prompted the US Army Corps of Engineers to freeze jurisdictional determinations for permitted activities pending additional guidance.

By Michael G. Romey, Lucas Quass, and Peter R. Viola

On May 25, 2023, by a narrow 5-4 majority, the US Supreme Court ruled in Sackett v. EPA that the Clean Water Act (CWA) only extends to wetlands that have a “continuous surface connection” with “waters of the United States” (WOTUS) — the term in the CWA’s definition of “navigable waters” that determines the jurisdiction of the US Army Corps of Engineers (the Corps) and the Environmental Protection Agency (EPA) (together, the Agencies) over projects and other activities requiring permits to dredge, fill, or discharge into federally protected waters.[1]

The record-low health advisories form part of the EPA’s 2021 PFAS Strategic Roadmap, which forecasts further regulatory action at both state and federal levels.

By Julia Hatcher, Kegan A. Brown, Thomas C. Pearce, Taylor West, Andy Landolfi, and Phil Sandick

On June 15, 2022, the United States Environmental Protection Agency (EPA) issued interim, updated drinking water health advisories (HA) for two of the most common per- and polyfluoroalkyl substances (PFAS): perfluorooctanoic acid (PFOA) and perfluorooctane sulfonic acid (PFOS).[1] EPA also issued two final HAs for perfluorobutane sulfonic acid and its potassium salt (PFBS) and hexafluoropropylene oxide and its ammonium salt (GenX).[2]

Limited water supply, restrictions on use, and higher costs may be in store for next year if the state’s drought conditions persist.

By Michael G. Romey, Cody M. Kermanian, and Lucas I. Quass

This year has been critically dry and hot for California, resulting in déjà vu as the federal and state governments reinstituted drought conservation measures not seen since former California Governor Jerry Brown declared an end to the last drought in 2017. This blog post summarizes the key federal and state actions that have been taken to address California’s drought over the past year, along with potential implications for 2022.

The decision could complicate states’ ability to pursue groundwater natural resource damages actions.

By Kegan A. Brown, Gary P. Gengel, Thomas C. Pearce, and Taylor R. West

On November 22, 2021, the US Supreme Court held that equitable apportionment applies to a dispute between states about their respective interests in groundwater that flows through multiple states in Mississippi v. Tennessee.[1] The decision may have implications for natural resource damages (NRD) claims. Natural resource trustees often assert claims to pursue damages to groundwater. In assessing these claims, courts often must determine (1) whether the trustee has a trusteeship interest in the groundwater resource at issue, and (2) if so, the extent of the trustee’s interest in that groundwater resource relative to the interests of other trustees in the same groundwater.

Project applicants and agencies alike should think carefully about developing robust analyses that demonstrate the adequacy of water supply.

By Marc T. Campopiano, Diego Enrique Flores, and Lucas I. Quass

Mark Twain is often credited with saying, “Whiskey is for drinking; water is for fighting over.” This remains true in California, where drought conditions, climate change, and population growth throughout the state’s history have made water an increasingly valuable and regulated resource. The legal landscape involves complex questions related to water quality, water sustainability, and competing claims to water rights. One notable area of controversy involves the adequacy of water supply for new development projects.

Two decades ago, in 2001, the state legislature enacted Senate Bill (SB) 610 and SB 221 to promote sustainable long-term water planning. Collectively, SB 610 and SB 221 require public agencies to determine whether adequate water supply exists for certain large development projects as part of the environmental review process under the California Environmental Quality Act (CEQA) by, in part, requesting water supply assessments (WSAs) from water service providers.

California Natural Resources Agency adopts final amendments to CEQA Guidelines, providing additional clarifying revisions to GHG impacts, baseline, and deferral of mitigation amendments.

By Marc Campopiano, Winston Stromberg, and Samantha Seikkula

The California Office of Administrative Law recently approved a suite of amendments to the CEQA Guidelines, which are now in effect. Latham wrote about these amendments last year, when the Natural Resources Agency began the rulemaking process under the Administrative Procedure Act. During this rulemaking process,

WIFIA program — no longer a “pilot” — is set to grow.

By Joel C. Beauvais and David J. Penna

On October 23, 2018, President Trump signed into law the America’s Water Infrastructure Act of 2018 (AWIA 2018). This bipartisan legislation, among other elements, reauthorized the Water Infrastructure Finance and Innovation Act (WIFIA). WIFIA, which established a federal water infrastructure bank administered by the US Environmental Protection Agency (EPA), is intended to ramp up federal funding for large-scale projects. Under the program, EPA can make low-interest, long-term loans and loan guarantees for a broad range of water projects. Eligible users include private, public, or mixed public-private entities, projects generally must be US$20 million or larger, and loans or guarantees can cover up to 49% of eligible costs. For a broader overview, please see Latham & Watkins’ WIFIA White Paper.

Although WIFIA was enacted in 2014, Congress did not fund the program until Fiscal Year (FY) 2017. In FY 2017, Congress appropriated funding sufficient to provide more than US$3 billion in loans or guarantees, and in FY 2018 expanded this to support more than US$5 billion in loans or guarantees. WIFIA uses a two-step selection process, beginning with the project proponents submitting letters of interest to EPA; from these, EPA selects a subset of projects to make a full application, with the expectation that projects making a full application ultimately will be approved. EPA closed its first loan in April 2018 and recently selected 39 projects to apply for FY 2018 funding. The program enjoys robust bipartisan support, and appears poised to continue to grow in coming years. While the reauthorizing legislation made only modest changes to WIFIA, water project developers considering using the program should note three key takeaways.

Fourth and Sixth Circuit decisions give power plant operators additional defenses to citizen suits pending potential Supreme Court review of “groundwater conduit” theory.

By Joel C. Beauvais and Stacey L. VanBelleghem

Over the past month, two US Courts of Appeals have rejected Clean Water Act (CWA) citizen suits seeking to hold power companies liable for discharges of pollutants from coal ash disposal facilities “through” groundwater to waters of the US. Although the Fourth Circuit accepted that discharges through groundwater could be the basis for liability, it held that the relevant ash piles and impoundments were not “point sources” for purposes of the CWA. The Sixth Circuit likewise held that the ash disposal facilities at issue were not point sources, but — contrary to the Fourth Circuit — also held that discharges through groundwater were not actionable under the Act. Collectively, these recent decisions stand as a significant new obstacle to citizen suits against owner/operators of coal ash impoundments. At the same time, the decisions deepen a circuit split on the so-called “groundwater conduit” theory of CWA liability, helping to tee the issue up for possible Supreme Court resolution. If the Court does take this question up, the outcome will be critically important for many industry sectors, including electric power, oil and gas, manufacturing, and mining companies, among others. The CWA imposes strict liability, and citizen suits based on groundwater conduit claims can result in extremely costly remedies — including large civil penalties and injunctive relief.

Companies may need to carefully consider practical business concerns to comply with the updated Prop 65 regulations, effective August 30.

By Michael G. Romey, Lucas I. Quass, and James A. Erselius

New regulations governing the implementation of the Safe Drinking Water and Toxic Enforcement Act of 1986 (Prop 65) will go into effect on August 30, 2018 that apply to products manufactured after the operative date of August 30, 2018. The new regulations update the content of the Prop 65 warning label that appears on products, in addition to other substantive changes.

Below is one example of how the new warning may look; however, the exact content will depend on the specifics of the exposure in question.