NAHB condemns proposed rule recently certificated by EPA, US Army Corps of Engineers that would redefine scope of waters protected under Clean Water Act, says rule would harm homebuilders

Allison Oesterle

WASHINGTON , May 29, 2014 (press release) – A proposed rule by the Environmental Protection Agency and U.S. Army Corps of Engineers (Corps) redefining the scope of waters protected under the Clean Water Act would harm home building firms and evades the intent and the letter of the law to make the regulatory process less costly and more efficient for small businesses, the National Association of Home Builders (NAHB) told Congress today.

Tom Woods, president of Blue Springs, Mo.-based Wood Custom Homes and NAHB’s first vice chairman, said the EPA and Corps overstepped their boundaries by certifying the proposed rule without complying with the Regulatory Flexibility Act (RFA), which requires federal agencies to review regulations for their impact on small businesses and consider less burdensome alternatives.

“By completely bypassing the RFA process, the agencies are not interested in hearing from the regulated community,” Woods testified before the House Small Business Committee. “Their only objective is to move this regulation closer to the finish line. For a rule of this magnitude, the small business voice must be heard and the agencies have failed to provide that platform.”

The claim by the EPA and the Corps that virtually anything could be a “tributary” if it is determined to have a bed, bank and an ordinary high-water mark could erroneously include manmade ditches, pipes, canals, dams, groundwater and isolated wetlands.

The rule also exacerbates the current regulatory confusion by adding new, undefined terms such as “floodplain” and “riparian area” to give regulators automatic federal jurisdiction over properties that contain isolated wetlands, ephemeral streams or any land features covered under the expansive definition of tributary.

“As a small business owner, this unpredictability will make it difficult for my business to comply and grow,” said Woods. “By falling well short of providing the clarity and certainty the construction industry seeks, the proposal could cause a slowdown in nationwide housing production that would harm state and local economies.”

Noting that Congress intended to create a partnership between the federal agencies and state governments to protect the nation’s water resources, Woods stated that the rule proposed by the federal agencies blatantly ignores this history of partnership and fails to recognize that there are limits on federal authority.

“As the former mayor of Blue Springs, Mo., I believe a key component of effective regulation is ensuring that local, state and federal agencies are cooperating, where possible, to streamline permitting requirements and are respecting the appropriate responsibilities of each level of government,” he said. “Importantly, more sensible regulation will translate into job growth in the construction industry.”

Construction projects rely on efficient, timely and consistent permitting procedures and review processes under Clean Water Act programs. Builders and developers are generally ill-equipped to make their own jurisdictional determinations and must hire outside consultants to secure necessary permits and approval.

“This takes time and money,” said Woods. “Onerous permitting liabilities could delay or eventually kill a real estate deal. If the rule is finalized in its current form, the ability to sell, build, expand or retrofit structures or properties will suffer notable setbacks, including added costs and delays for development and investment.

“I request that the agencies start over and develop a more meaningful and balanced rule that respects the spirit of the Regulatory Flexibility Act,” he added.

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