An AGC-backed lawsuit halts the Biden administration’s new “Waters of the United States” regulation—which expands federal permitting over more construction projects around water, potentially even some ditches—in Texas and Idaho.

An AGC-backed lawsuit has stopped federal agencies’ new 2023 “Waters of the United States” (WOTUS) rule from taking effect in two states. On March 19, a judge in southern Texas’ federal district court issued an opinion and order stopping the U.S. Environmental Protection Agency and the U.S. Army Corps of Engineers from implementing and enforcing the WOTUS rule in Texas and Idaho, thereby temporarily preserving the prior regulatory framework (1986/1988 regulatory definition of WOTUS) in those states until the court makes its final decision on the legality of the rule. The new 2023 WOTUS rule takes effect today, March 20, across the rest of the country (everywhere except TX and ID) – but other federal court decisions on similar preliminary injunction motions filed by at least 25 other states are expected out soon. 

Construction projects on or near WOTUS require costly and time-consuming federal permits before breaking ground – and non-compliant site owners/operators may be subject to both criminal and civil penalties. The new 2023 WOTUS rule codifies a very broad definition of WOTUS that brings many features under the federal agencies’ jurisdiction that would normally be considered dry land.

AGC of America is a party to the lawsuit – Texas v. EPA, S.D. Tex., 3:23-cv-00017, that was filed at the beginning of the year, in collaboration with an industry coalition representing a broad cross-section of the economy. AGC’s lawsuit was consolidated with a separate suit filed by the state of Texas and later joined by Idaho. Collectively, the plaintiffs seek to block the 2023 WOTUS rule because it violates the Administrative Procedures Act and it is unconstitutional in at least four ways: it violates the Commerce Clause, the Tenth Amendment, the Due Process Clause, and the Non-Delegation Doctrine.  

The U.S. District Court Judge Brown wrote that AGC’s industry coalition has standing to sue (i.e., a right to file the lawsuit), derivative of the States’ standing, which means the industry coalition can argue the merits of the case. Another positive development is that Judge Brown found that the parties to the lawsuit are likely to succeed in demonstrating that the new 2023 WOTUS rule oversteps the federal agencies’ authority under the Clean Water Act, casting particular doubt on the “significant nexus test” and the coverage of all interstate waters under the 2023 WOTUS rule. Judge Brown wrote that nationwide injunctions are disfavored stating “the court is reluctant to deprive states that embrace the Rule from exercising their sovereign rights…” which is why he denied AGC/industry’s request for a nationwide preliminary injunction (or stop) on the rule.

The federal agencies have moved ahead with the 2023 WOTUS rule, even though the U.S. Supreme Court may narrow the scope of waters subject to federal jurisdiction in the Sackett v. EPA case, at least with respect to the application of the significant nexus test preferred by the Biden administration. AGC asked the agencies to pause their rulemaking on the basis that it could be invalidated or significantly altered with the forthcoming Supreme Court ruling on this case and AGC submitted a joint “friend-of-the-court” brief in the Sackett case. AGC is also asking Congress to vote to invalidate the 2023 WOTUS rule and encouraging members to take action – click here.