San Diego
The Trump Administration is rolling back restrictions in the Clean Water Act and redefining waters of the US. Developers are celebrating the decision, everywhere but in California. In response to the administration's decision, the state has adopted new regulations over wetlands and waters of California. As a result, California won't be impacted by the changes to the Clean Water Act, but it will be impacted in other ways. The California changes will go into effect this May.
"There may be an impact, but it will not be positive for developers. Soon after he was inaugurated, President Trump issued an executive order telegraphing his intent to roll back jurisdiction under the Clean Water Act," Clark Morrison, a partner at Cox, Castle & Nicholson, tells GlobeSt.com. "In response, California's State Water Board kicked into high gear a new set of regulations to regulate all wetlands and other waters in California, including those losing their federal protection. If that weren't enough, the State's new regulations, which become effective in May, are more rigorous than applicable federal regulations."
Not only does this add more restrictions, it also complicates California projects as developers try to navigate the two laws. "Given that federal jurisdiction will remain over many types of waters, and that we now have a duplicative but more expansive program at the State level, it is not a stretch to say that the new rule has made it more complex to permit development projects in California," says Morrison. "The State Water Board is currently developing a guide to how the new regulations will be implemented, and we are working with the building industry and others to provide comments on that document. Nonetheless, as of May, each of California's nine regional water boards will be implementing a new set of regulations and there is likely to be a steep learning curve. This may affect both the timing and expense of any permit process."
The impact in other markets will depend on the local laws and guidelines. This could become a trend in other states looking to offset the lighter regulations coming from the federal government. "[The impact is] likely to depend on whether you're talking about markets in states that have comparable state programs that regulate the fill of wetlands and other waters that fall outside the purview of federal jurisdiction," Scott Birkey, a partner at Cox, Castle & Nicholson, tells GlobeSt.com. "Because of California's Porter-Cologne Water Quality Control Act and the State Water Resources Control Board's recently adopted wetlands protection program as described above, California is poised to step into the breach to regulate waters that may now no longer be covered under the federal permitting program. For those states with similar wetland permitting programs, and perhaps similar political persuasions, you might see more aggressive state regulation, as we expect to see in California."
On the other hand, some states will see a decrease in regulatory burden as a result of this move from the administration. "For those states without similar programs, the new definition of "waters of the United States" could result in significant regulatory relief for development," says Birkey.
No surprise, developers are not thrilled with the changes in California. "California developers are responding with a collective sigh of resignation," says Morrison. "Although the new definition may benefit developers in other states, developers in California are becoming accustomed to the fact that permitting only gets more difficult over time, never easier."
The challenges related to water regulations could be increasing again. Other agencies are also increasing regulatory hurdles in California. "CEQA has gotten more complicated under new guidelines adopted by the Office of Planning and Research," says Morrison. "The California Department of Fish and Wildlife is flexing its muscles in various ways. Regulators are getting more insistent on addressing issues such as environmental justice and climate change in the development context. So, although there is some relief that EPA and the Corps of Engineers may become less involved in development decisions, developers are facing many challenges in California that have muted much enthusiasm over the Trump administration's new rule."
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Kelsi Maree Borland
