Committee on Oversight and Government Reform

U.S. House of Representatives

114th Congress

Politicization of the 

Waters of the United States Rulemaking

Majority Staff Report

Hon. Jason Chaffetz, Chairman

Committee on Oversight and Government Reform

Hon. Cynthia Lummis, Chairman

Subcommittee on the Interior

Hon. Mark Meadows, Chairman

Subcommittee on Government Operations

Hon. Jim Jordan, Chairman

Subcommittee on Health Care, Benefits, and Administrative Rules

Hon. John Mica, Chairman

Subcommittee on Transportation and Public Assets

October 27, 2016
1

EXECUTIVE SUMMARY

The “Clean Water Rule,” commonly referred to as the “waters of the United States” 

(WOTUS) rule, was signed by Environmental Protection Agency Administrator Gina McCarthy 

and Assistant Secretary of the Army for Civil Works Jo-Ellen Darcy on May 27, 2015 in a 

picturesque signing ceremony hosted by the National Wildlife Federation on the banks of 

Washington, D.C.’s Anacostia River. The process that led to the rule’s signing, however, was 

rife with legal shortcuts, predetermined conclusions, and politically-driven timelines.

Passed by Congress in 1972, the Clean Water Act (CWA) gave the federal government 

limited jurisdiction over certain navigable waters. The statute failed to adequately define 

navigable waters, leaving the task to the agencies responsible for implementing the law. The 

legal definition of navigable waters is significant as it triggers multiple authorities under the 

CWA and provides the foundation of the jurisdictional authorities over navigable waters for both 

the U.S. Environmental Protection Agency (EPA) and the U.S. Army Corps of Engineers 

(Corps), which share CWA jurisdiction.

Challenges to the legal scope of the term “navigable waters” ensued after passage of the 

CWA, culminating in two notable Supreme Court cases in the last fifteen years. These cases 

upheld congressional limits on the scope of the CWA and rejected the notion of limitless federal 

government authority over water. In response to those decisions, the Bush Administration in 

2008 issued guidance incorporating the Court’s decision limiting CWA jurisdiction. However, 

in 2011 the Obama Administration issued its own guidance expanding the CWA’s reach to 

regulate a broad category of wetlands. 

On September 17, 2013, the EPA and the Corps announced a plan to abandon the 

proposed guidance in favor of clarifying the CWA through the rulemaking process. The 

agencies sent a draft rule to the Office of Information and Regulatory Affairs (OIRA)—the 

executive branch agency which reviews all significant draft regulations—the very same day. 
2

On April 21, 2014, after OIRA’s initial review, the EPA and the Corps issued a proposed 

WOTUS rule. The agencies sent a final draft of the rule to OIRA for review on April 6, 2015. 

The final rule was released on May 27, 2015.1

The final rule significantly increased the federal government’s jurisdiction under the 

CWA. The Administration purports that the federal government’s regulation of water will reach 

117 million new people under the rule, stating “about 117 million Americans—one in three 

people—get drinking water from streams that were vulnerable to pollution before the Clean 

Water Rule.”2 The EPA similarly determined in its Economic Analysis for the rule that the rule 

would increase jurisdiction.3 In the final rule, however, the Administration provides that the rule 

actually decreases the federal government’s control over waters. The final rule stated:

The scope of jurisdiction in this rule is narrower than that under the existing 

regulation. Fewer waters will be defined as ‘‘waters of the United States’’ 

under the rule than under the existing regulations, in part because the rule 

puts important qualifiers on some existing categories such as tributaries. In 

addition, the rule provides greater clarity regarding which waters are subject 

to CWA jurisdiction, reducing the instances in which permitting authorities, 

including the states and tribes with authorized section 402 and 404 CWA 

permitting programs, would need to make jurisdictional determinations on 

a case-specific basis.4

These inconsistent positions illustrate the Administration’s unwillingness to admit its 

unprecedented effort to expand the federal government’s jurisdiction under the Clean Water Act. 

The final rule also created significant uncertainty by imposing an arbitrary standard 

whereby waters within 4,000 feet from any jurisdictional water would be covered. As the rule 

explains:

[W]aters within the 100-year floodplain of a traditional navigable water, 

interstate water, or the territorial seas and waters within 4,000 feet of the 

high tide line or the ordinary high water mark of a traditional navigable 

water, interstate water, the territorial seas, impoundments, or covered 

tributary are subject to case-specific significant nexus determinations, 

unless the water is excluded under paragraph (b) of the rule.5

 

1 Definition of “Waters of the United States” Under the Clean Water Act, Docket Folder Summary, Docket ID:

EPA-HQ-OW-2011-0880, available at https://www.regulations.gov/docket?D=EPA-HQ-OW-2011-0880.

2 EPA website, available at https://www.epa.gov/sites/production/files/2015-

05/documents/fact_sheet_summary_final_1.pdf. 

3 EPA website, available at https://www.epa.gov/sites/production/files/2015-06/documents/508-

final_clean_water_rule_economic_analysis_5-20-15.pdf. 

4 EPA website, available at https://www.epa.gov/cleanwaterrule/final-clean-water-rule.

5 EPA website, available at https://www.epa.gov/sites/production/files/2015-06/documents/epa-hq-ow-2011-0880-

20862.pdf.
3

This standard would be very difficult to implement. As a chief Corps regulatory official 

involved in writing the rule and critical of the process told the Committee, “nobody has a 4,000 

foot long tape measure.”6 

The 4,000-foot standard effectively captures all of the nation’s water features. The rule’s 

Economic Analysis states: “The agencies have determined that the vast majority of the nation’s 

water features are located within 4,000 feet of a covered tributary, traditional navigable water, 

interstate water, or territorial sea.”7 The Executive Summary of the Final Rule stated:

In this final rule, the agencies clarify the scope of “waters of the United 

States” that are protected under the Clean Water Act, based upon the text of 

the statute, Supreme Court decisions, the best available peer-reviewed 

science, public input, and the agencies’ technical expertise in implement the 

statute.

None of this was true. Documents and testimony obtained by the Committee show the 

rulemaking process, and the outcome it produced, were deeply flawed because of numerous 

shortcuts and process violations. Witnesses testified that key decisions during the rulemaking 

process were affected by political considerations, including the timeline for finalizing the rule, 

which marginalized the scientific and economic considerations that would ordinarily form the 

basis for rulemaking decisions. Documents show staff from the Corps complained about the 

process, especially as it neared completion. Chief among those complaints was that the process 

was politicized, and not driven by science or economics.8

Documents also show high-level White House staff, including the Chief of Staff, assured 

environmentalist groups the Administration would quickly finalize the WOTUS rule.9 The 

Administration’s efforts to satisfy those groups caused the career staff involved in developing the 

rule to feel pressure to meet accelerated timelines, which caused deficiencies in the regulatory 

process. 

This report will provide information on the flawed process and outline other areas 

of concern with respect to the WOTUS rulemaking. The Administration’s insistence on 

adhering to a specific timeline resulted in cut corners and bypassed regulatory protocols. 

This rulemaking demonstrates how an ideological policy agenda can override regulatory 

safeguards put in place by Congress. The documents and testimony described in this 

report show: 

 

6 H. Comm. on Oversight & Gov’t Reform, Transcribed Interview of Jennifer Moyer, Tr. at 146-147 (Dec. 17, 

2015). [hereinafter Moyer Tr.]

7 Economic Analysis of the EPA-Army Clean Water Rule, U.S. EPA and U.S. Department of the Army, May 20, 

2015, available at https://www.epa.gov/sites/production/files/2015-06/documents/508-

final_clean_water_rule_economic_analysis_5-20-15.pdf.

8 H. Comm. on Oversight & Gov’t Reform, Transcribed Interview of Chip Smith, at 40 (Jan. 21, 2016). [hereinafter 

Smith Tr.]

9 Email from Jim Laity to Shayna L. Strom, Mar. 29, 2012, 2:12 p.m. (OMB-041300).
4

OIRA shortened the interagency review period for the final rule despite agencies’ complaints 

they would be unable to complete a proper review.

The interagency review process was so rushed that several federal agencies did not have 

time to properly review the rule. Staff at the National Aeronautics and Space Administration 

(NASA) wrote: “You’re killing us. . . . I think it’s fair to say that the powers that be are more 

interested in schedule (apparently compressed) than a reasoned response that objectively lays out 

likely ramifications . . . .”10 

When the Department of Transportation asked for additional regulatory documents and 

time to review them, OIRA staff suggested their request might not go over well with EPA and 

the Corps, citing “the pressure to get this rule out the door.”11 

The Department of Agriculture called the process “not well managed” and referenced

White House priorities interfering in the regulatory process by stating “sometimes the folks 

across the street from you do not care about longer term issues that other agencies do care 

about.”12 

The day the final rule was released, the OIRA staffer charged with conducting 

interagency review wrote: “The real challenge here was working on a very tight schedule which 

required me to provide short deadlines. To the extent that Agencies were able to provide me 

comments . . . I did all that I could to address them with EPA and the Corps . . . but even then 

there was only so much that I could do.”13

EPA sidelined the Army Corps of Engineers. 

As the administrator of dredge-and-fill permits, one of the most important parts of the 

CWA, and with experienced field staff all over the country, the Corps should have played a 

coequal role in the WOTUS rulemaking process. As the WOTUS rulemaking drew to a close, 

however, the Corps found itself less involved in the process than when it began. Corps staff 

testified the EPA did not involve them in writing the rule’s preamble, which outlines the 

justifications for undertaking the rulemaking. The Corps was also excluded from creation of the 

Economic Analysis of the rule, only seeing the analysis after the EPA sent it to OIRA for final 

review. When Corps staff finally saw the Economic Analysis, a Corps employee stated “. . . they 

had not used the data that we had developed, and they had used their own data.”14

The Corps’ minimal role in the rulemaking process was also observed by OIRA staff. On 

May 12, 2015, about two weeks before the final rule was released, an OMB employee sent an 

email summary of the “interagency Clean Water Rule roll-out meeting.”15 The summary 

 

10 Email from Kenneth Kumor, NASA to Vlad Dorjets, OIRA (May 5, 2015, 6:35 p.m.) (OMB-005830).

11 Email from Vlad Dorjets, OIRA, to Shoshanna Lew, DOT (May 5, 2015, 06:30 p.m.) (OMB-005827).

12 Email from Vlad Dorjets, OIRA, to Robert Johansson, USDA (May 27, 2015 11:10 a.m.) (OMB-006194). 

13 Id.

14 Moyer Tr. at 87-88 (Dec. 17, 2015).

15 Email from Tera Fong, OMB, to Vlad Dorjets, OIRA, et al. (May 12, 2015, 02:58 p.m.) (OMB-39663).
5

described the Corps as “a bit player in this process,” and observed that “[a]lthough all roll-out 

seems to be joint between EPA and the [Army] Corps, the meeting was very EPA-centric.”16

The EPA and the Army pushed the rule through despite strong objections from senior 

Corps leadership.

Major General John Peabody, Deputy Commanding General for Civil and Emergency 

Operations with the Corps, highlighted the Corps’ concerns regarding the EPA’s takeover of the 

rulemaking. In a series of memoranda (the Peabody Memoranda),17 sent shortly before the final 

rule’s public release to the Assistant Secretary of the Army for Civil Works, Jo-Ellen Darcy, 

General Peabody laid out several legal, scientific, and procedural concerns regarding the rule and 

stressed the Corps’ concerns about the rule’s deficiencies were ignored. Major General Peabody 

wrote: 

The preamble to the proposed rule and the draft preamble to the draft rule 

state that the rulemaking has been a joint effort of the EPA and the Corps, 

and that both agencies have jointly made significant findings, reached 

important conclusions, and stand behind the final rule. These statements 

are not accurate.18 

Major General Peabody then requested the rule “not identify the Corps as Author, co-author, or

substantive contributor,” and stated “the Corps of Engineers logo should be removed from those

documents.”19

The political leadership at the Army also sought to control information and the Corps’

interaction with EPA. In 2013, as the proposed WOTUS rule was being drafted, Assistant

Secretary Darcy issued instructions that “all communications with EPA and OMB during the 

interagency review . . . shall be reviewed by me or the Principal Deputy.”20 In April 2015, 

immediately prior to the release of the final rule, Assistant Secretary Darcy issued another “gag 

order” preventing Army Corps officials from communicating without her knowledge or 

permission. Specifically, she directed: “All communications with EPA, OMB, Congress, and the 

media during the interagency review process must come from my office.” 21 

 

16 Id.

17 Memorandum from Maj. Gen. John W. Peabody to Asst. Sec. of the Army for Civ. Works Jo-Ellen Darcy, 

Economic Analysis and Technical Support Documents Concerning the Draft Final Rule on Definition of “Waters of 

the United States” (May 15, 2015); Memorandum from Maj. Gen. John W. Peabody to Asst. Sec. of the Army for 

Civ. Works Jo-Ellen Darcy, Draft Final Rule on Definition of “Waters of the United States” (Apr. 27, 2015).

18 Memorandum from Maj. Gen. John W. Peabody to Asst. Sec. of the Army for Civ. Works Jo-Ellen Darcy, Draft 

Final Rule on Definition of “Waters of the United States” (Apr. 27, 2015). 

19 Id.

20 Memorandum from Jo Ellen Darcy, Assistant Sec. Civil Works, U.S. Army, to U.S. Army Corps Chief of 

Engineers (Oct. 3, 2013).

21 Email from Jo Ellen Darcy, U.S. Army, to Thomas Bostick, U.S. Army, et.al., (May 15, 2015, 05:13 p.m.).
6

EPA and the Army did not consider appropriate alternatives to the rule, as they were required 

to do. 

Under Executive Order 12866, agencies are required to identify and assess alternatives to 

regulatory proposals.22 The presentation of alternatives is intended to bolster agencies’ 

arguments in favor of a regulation by comparing it to viable alternatives, and is meant to occur 

prior to issuance of a proposed rule. After a draft of the proposed rule was leaked, however, and 

OIRA heard the charge that “substantive decisions have already been made” and the rule 

“includes no ‘alternatives’ as required by EO 12866,” OIRA staff conceded “[T]his is a fair 

concern.”23 

OIRA continued to voice frustration with the EPA on this matter on ensuing drafts, 

especially in the area of isolated non-connected waters. The same OIRA staffer wrote: “In place 

of these four distinct options the new preamble now has a long, disorganized series of requests 

for comment on just about everything they could possibly request comment on regarding other 

waters.” 

In reference to the EPA’s position, OIRA Administrator Howard Shelanski noted 

“[Administrator] Gina [McCarthy] made clear this was her doing not staff’s.”24 Thereafter, 

OIRA largely accepted the EPA’s position.25

EPA did not fully consider public comments before finalizing the rule.

One of the foundations of the rulemaking process is soliciting feedback through the 

public comment period. The EPA’s process for responding to comments was atypical—it failed 

to follow protocol for addressing them in the rule’s preamble.26 For WOTUS, the EPA instead 

chose to address public comments in a “massive separate response” which was “unlikely to be 

finished” in time for OIRA to review.27 This decision came from EPA Administrator Gina 

McCarthy herself. An OIRA official wrote: “EPA staff said it was Gina’s personal decision to 

write the preamble this way, and she was fully informed that this was ‘atypical’ for a final rule 

preamble.”28 

Army and Corps staff testified that despite expressing concerns that doing so was 

contrary to the standard agency process, the EPA and the Army decided comments could be 

addressed after the final rule entered interagency review.29 Since comment review occurred so 

late in the rulemaking process—even after the Corps reported receiving the draft final rule from 

 

22 Exec. Order No. 12,866, 58 Fed. Reg. 51,735 (Oct. 4, 1993), available at

https://www.whitehouse.gov/sites/default/files/omb/inforeg/eo12866/eo12866_10041993.pdf. 

23 Email from Jim Laity, OIRA, to Gregory Peck, EPA (Dec. 12, 2013, 7:19 p.m.).

24 Email from Howard Shelanski, OIRA, to Dominic Mancini, OIRA (Mar. 17, 2014, 11:52 a.m.) (OMB-051213)

(unredacted version on file with U.S. Dept. of Justice).

25 Email from Howard Shelanski, OIRA, to Andrei Greenawalt and Jim Laity, OIRA (Mar. 23, 2014, 05:36 p.m.) 

(OMB-051253) (unredacted version on file with U.S. Department of Justice). (emphasis added)

26 Email from Jim Laity, OIRA, to Howard Shelanski, Dom Mancini, and Katie Johnson, OIRA (Apr. 14, 2015, 6:27 

p.m.).

27 Id.

28 Id.

29 Moyer Tr. at 33 (Dec. 17, 2015).
7

the EPA—it cannot be determined how any of the comments were taken into account in the 

creation of the rule.

The handling of the science supporting the rule was problematic.

The EPA assembled a Scientific Advisory Board (SAB) to review a draft report titled 

“Connectivity of Streams and Wetlands to Downstream Waters: A Review and Synthesis of 

Scientific Evidence” (Connectivity Report) in July 2013.30 The report’s purpose was to show the 

need for WOTUS. The Connectivity Report, however, was finalized after the proposed rule was 

published, which creates the appearance that EPA’s policy decisions were foregone conclusions. 

Despite serving as the scientific basis for the rulemaking, the report was not finalized until 

January of 2015, well after the rule was drafted. OIRA noted this belated submission violated its 

information quality procedures. A high-ranking OIRA official further admitted this schedule 

was pursued “for primarily political reasons.”31

As the WOTUS rule evolved throughout the rulemaking process, especially with lastminute additions, Army and Corps staff testified that no new science was conducted or 

incorporated, as doing so would have interfered with the deadline for finalizing the rule.

The White House allowed EPA to bypass additional analysis and small business review panels 

despite the requirement under the Regulatory Flexibility Act.

Under the Regulatory Flexibility Act (RFA) and the Small Business Regulatory 

Enforcement Fairness Act (SBREFA), an agency engaging in rulemaking must analyze whether 

its actions will have a significant impact on small businesses. The EPA, specifically, is required 

to work with the Small Business Administration’s (SBA) Office of Advocacy and OIRA to 

convene a small business advocacy review panel to thoroughly review how a proposed 

regulation will impact small entities.

In this instance, the EPA not only ignored comprehensive evidence suggesting the 

WOTUS rule would have a significant impact on small businesses, but deliberately avoided 

conducting a regulatory flexibility analysis and public hearings on WOTUS’ impact on small 

businesses. An OIRA memo states: 

We were reminded by EPA that there was an agreement at the time we were 

reviewing the draft guidance to not convene a SBREFA panel, but rather to 

convene a “voluntary, SBREFA-like” process including outreach to small 

entities and a report to the Administrator. SBA was not a party to that 

agreement, but might be persuaded that it is an acceptable substitute for a 

full SBREFA process. EPA did convene an outreach meeting to small 

 

30 Memorandum from Thomas M. Armitage, Designated Federal Officer, EPA Science Advisory Board Staff Office, 

to Christopher S. Zarba, Acting Director EPA Science Advisory Board Staff Office, July 29, 2013, 

http://yosemite.epa.gov/sab/sabproduct.nsf/fedrgstr_activites/77243 

57376745F48852579E60043E88C/$File/Final%20Determination%20memo_connectivity%20panel%20(unsigned).

pdf (last visited Aug. 11, 2016).

31 Email from Dominic Mancini, OIRA, to Margo Schwab and Jim Laity, OIRA (Sep. 13, 2013, 3:29 p.m.) (OMB34473) (unredacted version on file with U.S. Department of Justice). (emphasis added)
8

entities in 2011, which OIRA and SBA also attended, and has now provided 

a draft report which we are currently reviewing.

32

SBA did not accept this view and continued to criticize the rulemaking process.33 An OIRA 

staffer noted less than a month before WOTUS was finalized that “SBA will make their own 

decisions about what to do after the rule is published.”34

The Army predetermined its NEPA analysis to avoid interference with the rigorous timeline 

for rolling out the rule.

The National Environmental Policy Act (NEPA) requires a federal agency to prepare an 

environmental impact statement (EIS) for any major federal action “significantly affecting the 

quality of the human environment.”35 To determine the need for an EIS, an agency must first 

prepare an Environmental Assessment (EA), which governs whether to prepare an EIS or make a 

finding of no significant impact (FONSI). If an EIS is necessary, agencies must undergo a 

lengthy environmental study process and public outreach effort.36 Conversely, a FONSI leads to 

a much more streamlined NEPA process, with only a requirement to present why the agency 

determined no significant environmental impact would occur due to the rule.

In 2014, Chip Smith, the Army’s primary NEPA staffer, was preparing an EA that 

anticipated a FONSI based on the substance of the draft rule. Around early 2015, though, “last 

minute” modifications greatly “changed the dynamics” of the rule by significantly shrinking 

EPA’s jurisdiction over certain wetlands and water bodies.37 These revisions rendered work on 

the EA inconsistent with the new draft, and Smith believed this now required preparation of an 

EIS under NEPA.

Smith’s belief was mirrored by Major General Peabody, the military head of the Corps’ 

civil works activities, who stated in a memorandum: “The Corps would need to prepare an (EIS) 

to address the significant adverse effects on the human environment that would result from the 

adoption of the rule in its current form.”38 

 

32 Waters of the US Outstanding Policy Issues, Internal Memo, OIRA on Waters of the US Outstanding Policy 

Issues, (Jan. 9, 2014) (OMB-045605).

33 Email from Jim Laity, OIRA, to Vlad Dorjets, Howard Shelanski, and Dominic Mancini, OIRA (Apr. 29, 2015, 

11:02 a.m.) (OMB-034284).

34 Id.

35 The National Environmental Policy Act of 1969, Pub. L. No. 91-190, 83 Stat. 852 (1970; 42 U.S.C.) § § 

4332(2)(C); State of N.C. v. F.A.A., 957 F.2d 1125, 1128 (4th Cir. 1992).

36 Linda Luther, Cong. Research Serv., RL33152, The National Environmental Policy Act (NEPA): Background and 

Implementation; CRS (2011).

37 Smith Tr. at 73 (Jan. 21, 2016).

38 Memorandum from John W. Peabody, Maj. Gen. U.S. Army, to EPA Asst. Sec. for Civil Works (Apr. 27, 2015).
9

Regulatory staff at the Corps also agreed with the need for an EIS.39 When Smith 

recommended an EIS, he was removed from his duties on WOTUS, and replaced by someone 

who had no previous experience on WOTUS and who “essentially started from scratch.”40 

Smith’s replacement recommended a FONSI, which Assistant Secretary Darcy adopted.41

 

39 Moyer Tr. at 115-116 (Dec. 17, 2015).

40

 H. Comm. on Oversight & Gov’t Reform, Transcribed Interview of Craig Schmauder, Tr. at 171 (Feb. 17, 2016). 

[hereinafter Schmauder Tr.]

41 Moyer Tr. at 131 (Dec. 17, 2015).
10

FINDINGS

 The agencies pushed the rule through on an accelerated timeline that appeared to have 

been motivated by political considerations. Some officials involved in the process believed 

politics deprived them the opportunity to conduct a meaningful and full review of the rule 

before its promulgation. Interagency reviewers and the White House were not provided the 

full rule package for review.

 The U.S. Army Corps of Engineers, which shares jurisdiction over the Clean Water Act, was 

cut out of the rule development process.

 The EPA made no effort to ensure the rule was based on sound science. The EPA did not 

conduct additional research (which the Corps believed was necessary) to justify the rule’s 

conclusions. OIRA enabled the agencies to proceed with the rulemaking despite violation of 

its own Information Quality standards.

 The agencies did not consider alternatives to the rule, and even went so far as to gut the 

discussion of alternatives after OIRA stated such discussion was necessary.

 The Army went to unusual lengths to avoid completing an Environmental Impact Statement 

after its own experts recommended such an analysis was necessary, in violation of NEPA. 

The Army pulled its primary WOTUS staffer off the rule entirely and retaliated against him 

after he recommended to conduct the analysis.

 Disagreement over the EPA’s interpretation of the costs of the rule and its impact on small 

businesses continued throughout the rulemaking. OIRA and the EPA intentionally avoided 

compliance with the Regulatory Flexibility Act (RFA) and Small Business Regulatory 

Enforcement Fairness Act (SBREFA). The agencies construed the rulemaking as 

“definitional” to avoid the EPA’s obligations under the RFA, altogether.

 Public comments were not fully reviewed and considered before agencies drafted the final 

rule. The agencies contrived a unique process for considering and responding to public 

comments, despite arguments from Army Corps and EPA staff in favor of including such 

responses in the rule’s preamble, as is customary.

 The agencies failed to comply with various rulemaking obligations, including Executive 

Orders requiring consultation with states and local governments and tribes.
11

TABLE OF CONTENTS

Executive Summary .....................................................................................................1

Findings.....................................................................................................................10

Timeline of the “Waters of the United States” Rule ...................................................13

 Events Leading Up to Rulemaking: 1972-2011..................................................................................13

 Formal Rulemaking: 2013 – 2015 ......................................................................................................16

 Post-Rulemaking ................................................................................................................................22

Table of Names..........................................................................................................23

Introduction ..............................................................................................................24

 The History of the Definition of Navigable Waters............................................................................24

 The EPA’s and the Corps’ Responses to the Court’s Decisions..........................................................25

 Guidance Became a Rulemaking........................................................................................................26

Political Considerations Drove the WOTUS Rulemaking .............................................29

 The EPA Funded an Improper Grassroots Lobbying Effort................................................................35

 Politics Influenced the Timeline for Releasing the Rule ....................................................................38

 OIRA’s Review was Rushed................................................................................................................41

EPA Excluded the Corps From the “Joint” Rulemaking Process...................................50

 The EPA Did Not Include the Corps in Important WOTUS Decision-Making.....................................52

 EPA Excluded the Corps from Considering Basic Components of the Rule.......................................55

 The EPA Stopped Collaborating with the Corps Altogether ..............................................................58

 Corps Leadership Had Concerns About the EPA’s Approach.............................................................62

a. The Peabody Memoranda were “unprecedented”............................................................................65

b. The Peabody Memoranda show the EPA ignored the Army Corps’ concerns about developing the 

WOTUS rule based on faulty science ...............................................................................................66

c. Top Army officials issued a “gag order” to bury disagreement with the EPA’s agenda .........................72

d. The Corps’ rulemaking experts were cut off from the decision makers...............................................74

e. OIRA did not treat the Corps as an equal partner with the EPA in the WOTUS rulemaking ...................77

f. The “Civiletti Memorandum” Does Not Control this Joint Rulemaking................................................78

g. GAO’s Major Rule report does not evaluate agency compliance with the law .....................................80

The EPA Disregarded Science While Developing the Clean Water Rule...............................................82

 The Scientific Basis for the Rule Was Finalized After the Rule Was Drafted .....................................82
12

 The Connectivity Report Was Flawed and Scientifically Unsound ....................................................88

 The EPA Disregarded the Corps’ Recommendations and Did Not Conduct New Science.................93

 The EPA Limited Changes to the Final Connectivity Report and Ensured It Supported the Proposed 

Rule ....................................................................................................................................................95

 The Peer Review Process Was Flawed...............................................................................................96

 The WOTUS “Adjacency Limits” Are Not Based on Science ............................................................100

A Disregard for the Rulemaking Process..........................................................................................106

 The Agencies Did Not Consider Alternatives Until After the Rule Was Drafted..............................106

 WOTUS Was Based On a Flawed NEPA Analysis..............................................................................113

a. The Army disregarded NEPA provisions triggered by significant new changes and predetermined NEPA 

analyses......................................................................................................................................116

b. The final EA was produced by staff with no WOTUS experience.......................................................123

 The Economic Analysis of the WOTUS Rule Was Flawed ................................................................125

a. The EPA pushed back against the appropriate significance determination........................................126

b. The EPA used inconsistent baselines, misused the term “indirect costs,” and utilized an inappropriate 

benefits transfer technique ..........................................................................................................130

c. The Economic Analysis was not provided along with the final rule for review ...................................136

 The EPA Failed to Comply with the Regulatory Flexibility Act.........................................................138

 The WOTUS Rule is a Product of a Flawed Comment Review.........................................................150

a. Public comments may have been mischaracterized ........................................................................150

b. Review of public comments was rushed ........................................................................................153

c. OIRA did not review whether comments were addressed ...............................................................154

d. The agencies rushed the review of public comments......................................................................157

e. The EPA Drafted the Final Rule before completing the public comments review ...............................161

 Recirculation of the Final Rule.........................................................................................................163

Failure to comply with State, Local, and Tribal consultation requirements.......................................165

 The Agencies Failed to Comply with Executive Order 13132 and Principles of Federalism............165

 The Agencies Failed to Properly Consult with State and Local Governments as Required by the 

Clean Water Act, Executive Order 13132, and California Wilderness.............................................167

 The EPA Failed to Sufficiently Consult with Indian Tribal Governments.........................................172

Conclusion.....................................................................................................................................180
13

TIMELINE OF THE “WATERS OF THE UNITED STATES” RULE

Events Leading Up to Rulemaking: 1972-2011

1972 

Underlying Statute Passed

 Congress passes the Clean Water Act (CWA) to regulate discharges of pollutants into the 

“waters of the United States” (WOTUS).42 Responsibilities under the program are shared by 

the U.S. Environmental Protection Agency (EPA) and the U.S. Army Corps of Engineers 

(the Corps).

1985 

Supreme Court First Addresses “Waters of the United States”

 U.S. Supreme Court first addresses the proper interpretation of the Corps’ regulation defining 

“waters of the United States” and the scope of its jurisdiction under the Clean Water Act in 

United States v. Riverside Bayview.

43

 The Court holds unanimously that the Corps has acted 

reasonably in interpreting the CWA to require permits for the discharge of fill material into 

wetlands adjacent to the “waters of the United States.”

2001 

Supreme Court Rules that Agency Regulation of Dredged or Fill Material Exceeds Statutory Scope 

 U.S. Supreme Court holds that the Environmental Protection Agency (EPA) and the Corps’

extension of jurisdiction for regulating the discharge of dredged or fill material exceeded 

their authority under the CWA in Solid Waste Agency of Northern Cook County v. U.S. Army 

Corps of Engineers (SWANCC).

44

2006 

Supreme Court Rules that Agency Regulation of Wetlands Exceeds Statutory Scope

 U.S. Supreme Court again overturns the EPA and the Corps’ expansive definition of 

jurisdiction over wetlands under the CWA in Rapanos v. United States (Rapanos).45

 

42 33 U.S.C. §§1251-1387 (1972).

43 474 U.S. 121 (1985).

44 531 U.S. 159 (2001).

45 547 U.S. 715 (2006).
14

2007 

First Guidance Issued Following Supreme Court’s Finding that Agency Regulation Exceeds 

Statutory Scope 

 Subsequent to the Rapanos decision, the agencies issue a preliminary guidance memorandum 

aimed at answering questions regarding CWA regulatory authority over wetlands and 

streams.46

2008 

Additional Guidance Released Adhering to Plurality Opinion in Rapanos 

 The Agencies release an updated guidance memorandum to EPA regions and Corps districts

clarifying the terms and procedures to be used to determine the extent of federal jurisdiction 

over “waters of the United States,” building upon the previous guidance memorandum issued 

in 2007.47 This guidance largely hewed to the plurality opinion in Rapanos, requiring the 

EPA and the Corps to establish a “significant nexus” between navigable waters and wetlands 

in order to regulate under CWA. 

February 2009 

Obama Administration Holds First Meeting with Intention to Pursue WOTUS Rule 

 Roughly one month after the Obama administration takes office, the EPA holds its first 

principal meeting and announces its intention to pursue the Waters of the United States 

(WOTUS) rule before political leadership is set up within the Office of Assistant Secretary of 

the Army for Civil Works, which oversees the Corps.48 Administrator Lisa Jackson 

attends.49

May 2011 

Agencies Release Further Guidance Extending Jurisdiction over Waters of the U.S. Despite 

Supreme Court Rulings Curtailing Their Jurisdiction 

 The EPA and the Corps release guidance, intended to replace the existing 2008 guidance, to 

further clarify how the agencies identify “waters of the United States” under the CWA.50 

Despite the Court rulings in Rapanos and SWANCC, the agencies state in the proposed 

guidance that “the extent of waters over which the agencies assert jurisdiction under the 

CWA will increase compared to the extent of waters over which jurisdiction has been 

 

46 See Joint Legal Memorandum, Clean Water Act Jurisdiction Following the U.S. Supreme Court’s Decision in 

Rapanos v. United States & Carabell v. United States (June 5, 2007). 

47 Revised Mem. from Envtl. Prot. Agency & Dep't of the Army on Clean Water Act Jurisdiction Following the U.S.

Supreme Court's Decision in Rapanos v. United States & Carabell v. United States (Dec. 2, 2008), available at 

https://www.epa.gov/sites/production/files/2016-02/documents/cwa_jurisdiction_following_rapanos120208.pdf.

48 Smith Tr. at 11-12 (Jan. 21, 2016).

49 Id.

50 Environmental Protection Agency and Army Corps of Engineers, “Draft Guidance on Identifying Waters 

Protected by the Clean Water Act,” Apr. 27, 2011, p. 20, available at

http://water.epa.gov/lawsregs/guidance/wetlands/upload/wous_guidance_4-2011.pdf. 
15

asserted under existing guidance.”

51

 Both supporters and critics of the 2011 guidance 

formally urge the EPA and the Corps to replace guidance, which is non-binding and not 

subject to full notice-and-comment rulemaking procedures, with revised regulations to define 

“waters of the United States.”

52

 This guidance essentially becomes the final WOTUS rule. 

July 2011 

Comments Submitted in Response to Proposed Guidance Arguing It Misconstrues the Supreme 

Court’s Holdings 

 Members of Congress, stakeholders, and states submit comments to the Agencies, 

expressing, among other things, concern that the proposed guidance misconstrues the 

Supreme Court’s holdings in Rapanos and SWANCC,

53

“usurps the rights of state and local 

governments to manage land and water resources,”

54 and circumvents the requirements and 

safeguards of the Administrative Procedures Act.”

55

February 2012 

Regulatory Review of Proposed Guidance Begins 

 The EPA and the Corps send the revised proposed guidance to the OIRA for review under 

Executive Order 12866.56

March 2012 

Email Notes White House Chief of Staff Commitment on WOTUS to Environmental Groups 

 In an email dated March 29, 2012, OIRA’s Chief of the Natural Resources and 

Environmental Branch, Jim Laity writes “This is very big deal. I understand COS has 

promised enviros it will be done ‘soon.’”

57

 

51 Environmental Protection Agency and Army Corps of Engineers, "Draft Guidance on Identifying Waters 

Protected by the Clean Water Act," May 2, 2011, p. 3, https://www.regulations.gov/document?D=EPA-HQ-OW2011-0409-0002. 

52 CLAUDIA COPELAND, CONGRESSIONAL RESEARCH SERVICE, EPA AND THE ARMY CORPS’ RULE TO DEFINE 

“WATERS OF THE UNITED STATES” 3 (2016); Environmental Protection Agency, Persons and Organizations 

Requesting Clarification of “Waters of the United States” By Rulemaking (Apr., 2014), available at 

https://www.epa.gov/sites/production/files/2014-03/documents/wus_request_rulemaking.pdf.

53 Arizona Mining Association, Comment Letter on Draft Guidance on Identifying Waters Protected by the Clean 

Water Act, Docket No. EPA-HQ-OW-2011-0409 (July 29, 2011), available at 

https://www.regulations.gov/document?D=EPA-HQ-OW-2011-0409-3599.

54 Minnesota Free Market Institute, Comment Letter on Draft Guidance on Identifying Waters Protected by the 

Clean Water Act, Docket No. EPA-HQ-OW-2011-0409 (July 26, 2011), available at 

https://www.regulations.gov/document?D=EPA-HQ-OW-2011-0409-3267.

55 Ohio Oil and Gas Association, Comment Letter on Draft Guidance on Identifying Waters Protected by the Clean 

Water Act, Docket No. EPA-HQ-OW-2011-0409 (July 29, 2011), available at 

https://www.regulations.gov/document?D=EPA-HQ-OW-2011-0409-3355. 

56 Letter from Hon. Sheldon Whitehouse, U.S. Senator, to Hon. Sylvia Matthews Burwell, Office of Management 

and Budget (June 4, 2013), available at https://www.whitehouse.senate.gov/news/release/omb-delays-underminingadministrations-agenda-on-environment-energy-and-public-health. 

57 Email from Jim Laity, OIRA, to Shayna L. Strom, OIRA (Mar. 29, 2012, 2:12 p.m.) (OMB-041300).
16

Rulemaking: 2013 – 2015

July 2013 

Science Advisory Board Assembled to Review Rule’s Underlying Science 

 The EPA Science Advisory Board (SAB) launches an Expert Scientific Peer Review for the 

EPA’s Water Body Connectivity Report, which discusses the current scientific understanding 

of the connections or isolation of streams and wetlands relative to large bodies of water.58

September 2013 

Agencies Announce the Withdrawal of the Proposed Guidance and Decision to Pursue Noticeand-Comment Rulemaking; 

Review of Guidance Still Outstanding 

 On September 17, 2013, the Corps and the EPA withdraw the proposed guidance from OIRA 

review and simultaneously submit a draft WOTUS rule for regulatory review.59 The 

guidance had been under OIRA review since February, 2012, well over a year past the 90-

day time period allowed under Executive Order 12866.60

 The EPA releases its draft Connectivity Report – the scientific basis for the Rule – to be 

reviewed by the SAB prior to proposed rule.61

October 2013 

Assistant Secretary for Civil Works Issues First “Gag Order”

 On October, 3 2013, U.S. Army Assistant Secretary for Civil Works Jo-Ellen Darcy issues 

the first “gag order” directing all Army and Army Corps communications with the EPA, 

OMB, or other outside entities regarding WOTUS to first go through her office.62

November 2013 

Congressman Lamar Smith Questions Why Science Advisory Board Failed to Address 

“Significance” of Connections 

 On November 6, 2013, Chairman Lamar Smith of the House Committee on Science, Space 

and Technology requests that the SAB reviewing the Connectivity Report provide 

 

58 Memorandum from Thomas M. Armitage, Designated Federal Officer, EPA Science Advisory Board Staff Office, 

to Christopher S. Zarba, Acting Director EPA Science Advisory Board Staff Office, July 29, 2013, available at 

http://yosemite.epa.gov/sab/sabproduct.nsf/fedrgstr_activites/77243. 

57376745F48852579E60043E88C/$File/Final%20Determination%20memo_connectivity%20panel%20(unsigned).

pdf.

59 Amena H. Saiyid, EPA, Corps Send Proposed Rule to OMB to Clarify Clean Water Act Jurisdiction, 

BLOOMBERG BNA (Sept. 18, 2013), available at http://www.bna.com/epa-corps-send-n17179877129/.

60 EPA Readies ‘Connectivity’ Study to Bolster Clean Water Jurisdiction Policy, Inside EPA, Feb. 16, 2012.

61 78 Fed. Reg. 185 (Sept. 24, 2013). 

62 Memorandum from Jo Ellen Darcy, Assistant Sec. Civil Works, U.S. Army, to U.S. Army Corps Chief of 

Engineers (Oct. 3, 2013).
17

explanations as to why the report fails to “ask important questions about the about the 

significance of these connections to the health and integrity of downstream waters.”

63

 

December 2013 

The EPA Fails to Address Congressman Lamar Smith’s Concerns 

 On December 16, 2013, the EPA responds to Chairman Smith without answering any of his 

questions.64

February 2014 

The EPA Unlawfully Uses Social Media to Generate Support for WOTUS;

The Corps Informs the EPA of Outdated Economic Data

 The Administration and the EPA begin engaging in advocacy efforts to garner backing for 

the WOTUS rulemaking using various social media platforms, including Facebook, Twitter, 

Thunderclap, and a #Ditchthemyth campaign.65 The GAO ultimately concludes that “EPA 

violated the described provisions through its use of social media in association with its 

rulemaking efforts to define ‘Waters of the United States’ under the Clean Water Act (CWA) 

during FYs 2014 and 2015.”

66

 On February 20, 2014, the Corps indicates that the EPA’s Economic Analysis relied on 

outdated data and “[t]he analysis has not be revised to specifically evaluate the benefits and 

cost of the proposed rule, which is very different from the proposed Guidance.”

67

April 2014 

Proposed WOTUS Rule Released 

 On April 21, 2014, the proposed WOTUS rule is published in Federal Register, which starts 

the public comment period.

68

 

63 Letter from the Honorable Lamar A. Smith, Chairman, U.S. House of Representatives Committee on Science, 

Space, and Technology, to Dr. Amanda Rodewald, Chair, Science Advisory Board Panel for the Review of the EPA 

Water Body Connectivity Report (Nov. 6, 2013), available at

https://yosemite.epa.gov/sab/sabproduct.nsf/7FF38D8F9D02345485257C2300685787/$File/11-06-

2013+Science+Committee+Letter+to+Dr++Rodewald+and+Dr++Allen.pdf.

64 Letter from Laura Vaught, Associate Administrator, EPA Office of Congressional and Intergovernmental 

Relations, to the Honorable Lamar Smith (Dec. 16, 2013) available at

https://yosemite.epa.gov/sab/sabproduct.nsf/E4735639227A41CE85257C43006DF51F/$File/Chairman+Smith.pdf.

65 Letter from Susan A. Poling, General Counsel, Gov’t Accountability Office, to the Honorable James M. Inhofe, 

Chmn., Comm. on Environment and Public Works, U.S. Senate, Dec. 14, 2015, available at

http://www.gao.gov/assets/680/674163.pdf.

66 Id.

67 Memo attached to Email from Charles Smith, Army Corps, to Jim Laity, OIRA (Jan. 23, 2015, 12:49 p.m.) 

(OMB-046648).

68 Definition of "Waters of the United States" Under the Clean Water Act, Docket Folder Summary, Docket ID: 

EPA-HQ-OW-2011-0880, available at https://www.regulations.gov/docket?D=EPA-HQ-OW-2011-0880.
18

June 2014 

Initial Extension of Comment Period 

 On June 24, 2014, the Agencies extend the comment period for the rule by 90 days.69

September 2014 

“Team of Eight” First Meets 

 EPA/Army Corps’ “team of eight”— A group of eight individuals from the EPA and the 

Corps who met to discuss “technical issues and concerns” related to the rulemaking—begins 

working through the proposed WOTUS rule.70

October 2014 

SAB Completes Scientific Basis for Rulemaking Five Months After Rule Published 

 The EPA’s Scientific Advisory Board (SAB), which provides independent engineering and 

scientific advice to the agency, completes its review of the Connectivity Report.71 Thus, the 

scientific understanding behind the rule was completed after the rule was published. 

 On October 14, 2014, the Agencies again extend the comment period, this time by 30 days.72

 

 The Small Business Administration Office of Advocacy’s Chief Counsel releases WOTUS 

comment letter strongly opposing the EPA’s determination that the rule does not invoke 

regulatory protections for small businesses.73

 The National Federation of Independent Businesses submits two sets of comments protesting 

the rule, asserting that the EPA violated the Regulatory Flexibility Act because the EPA 

failed to convene a Small Business Advocacy Review Panel before drafting the proposal.74

 

 

69 Definition of "Waters of the United States" Under the Clean Water Act, Docket Folder Summary, Docket ID:

EPA-HQ-OW-2011-0880, available at https://www.regulations.gov/docket?D=EPA-HQ-OW-2011-0880.

70 Moyer Tr. at 56 (Dec. 17, 2015).

71 CLAUDIA COPELAND, CONGRESSIONAL RESEARCH SERVICE, EPA AND THE ARMY CORPS’ RULE TO DEFINE 

“WATERS OF THE UNITED STATES” 3 (2016).

72 Definition of "Waters of the United States" Under the Clean Water Act, Docket Folder Summary, Docket ID:

EPA-HQ-OW-2011-0880, available at https://www.regulations.gov/docket?D=EPA-HQ-OW-2011-0880.

73 WINSLOW SARGEANT, CHIEF COUNSEL, OFFICE OF ADVOCACY, SBA, COMMENT LETTER ON 

THE PROPOSED DEFINITION OF “WATERS OF THE UNITED STATES” UNDER THE CLEAN WATER 

ACT 4 (Oct. 1, 2014), available at https://www.sba.gov/advocacy/1012014-definition-waters-united-states-underclean-water-act.

74 Drowning in Regulations: The Waters of the U.S. Rule and the Case for Reforming the RFA Before the S. Comm. 

on Small Business and Entrepreneurship, 114th Cong. (2016) (statement of Elizabeth Milito, Esq., National 

Federation of Independent Business). 
19

November 2014 

EPA Effectively Cuts the Corps Out of Rulemaking

 The EPA suddenly stops “team of eight” meetings, effectively cutting the Corps out from 

collaboration without resolving all WOTUS concerns.75

 On November 14, 2014, the public comment period for WOTUS rule closes, allowing only 

one month for the public to review the rule after the SAB completed its peer review of the 

science cited as the basis for the rule.76

January 2015 

Final Connectivity Report Released Despite Final Rule Still Under Review

 Corps personnel on team of eight are “surprised” to see WOTUS final draft text.77

 The EPA releases final Connectivity Report—the scientific analysis of the rule—on January 

15, 2015, at approximately the same time that the final rule was completed.78

February 2015 

Last Minute Changes Spark the Corps to Call for Revising NEPA Analysis

 Significant last-minute jurisdictional changes to the rule convince the Corps to call for 

revising the National Environmental Policy Act (NEPA) analysis to recommend that more 

environmental analysis be conducted.

79

April 2015 

The EPA Submits Final Rule for Review and Ignores Concerns Raised by OIRA and Other Agencies

 On April 3, 2015, Assistant Secretary Darcy issues a second “gag order” demanding that all 

Army and Army Corps communications to outside agencies and entities first go through her 

office.80

 On April 6, 2015, the final WOTUS rule is submitted to OIRA for review.81

 

75 Moyer Tr. at 56-57 (Dec. 17, 2015).

76

 Definition of "Waters of the United States" Under the Clean Water Act, Docket Folder Summary, Docket ID: 

EPA-HQ-OW-2011-0880, available at https://www.regulations.gov/docket?D=EPA-HQ-OW-2011-0880.

77 Moyer Tr. at 59 (Dec. 17, 2015).

78 Connectivity of Streams and Wetlands to Downstream Waters: A Review and Synthesis of the Scientific 

Evidence, 80 FR 2100, available at https://www.federalregister.gov/articles/2015/01/15/2015-00339/connectivityof-streams-and-wetlands-to-downstream-waters-a-review-and-synthesis-of-the-scientific.

79 Smith Tr. at 73 (Jan. 21, 2016).

80 Email from Jo Ellen Darcy, U.S. Army, to Thomas Bostick, U.S. Army, et.al., (May 15, 2015; 05:13 p.m.).

81 Definition of "Waters of the United States" Under the Clean Water Act, Docket Folder Summary, Docket ID: 

EPA-HQ-OW-2011-0880, available at https://www.regulations.gov/docket?D=EPA-HQ-OW-2011-0880.
20

 On April 14, 2015, OIRA expresses concern over ability to meet the accelerated review 

deadline, as well as the EPA’s failure to deliver the rule’s Economic Analysis despite having 

already submitted the rule for review. 

 On April 27, 2015, Maj. Gen. Peabody of the Corps argues that the new changes to CWA 

jurisdiction under WOTUS are significant enough to require preparation of an Environmental 

Impact Statement (EIS), despite the Army’s Finding of No Significant Impact (FONSI), 

which does not require the time-consuming environmental study of an EIS.82

 On April 27, 2015, OIRA sends rule out for interagency review and requests agency 

responses by May 11, 2015, allowing other agencies a mere two weeks to review the rule and 

provide feedback.83 

 On April 28, 2015, in an example of agency concern over lack of review time, NASA 

requests an extension to review the final rule as they “had no ability to include [their] critical 

field centers in the [their] comment review process.”

84

 On April 29, 2015, OIRA denies NASA pleas for more time to review the complex rule.85

 In late April 2015—a month before the final rule is promulgated—Assistant Secretary Darcy

reassigns NEPA preparation from the Army’s long-time NEPA staffer to personnel with 

minimal knowledge of rule after the staffer continuously advises the EPA of the need for an 

EIS.86

May 2015 

Final Rule is Signed Despite Agency Concerns;

A Corps Memo States the Economic Analysis of the Rule is Significantly Flawed 

 On May 5, 2015, despite the already rushed timeline, OIRA requests interagency comments 

on WOTUS sooner, since “[t]he pressure on WOTUS/Clean Water Rule is getting turned up 

from on high.”

87

 Following OIRA’s push for a faster review process, NASA officials tell OIRA that “[y]ou’re 

killing us”

88 and Department of Transportation (DOT) officials inform OIRA they are “not 

sure we can do it.”

89

 

82 Memorandum from John W. Peabody, Maj. Gen. U.S. Army, to EPA Asst. Sec. for Civil Works (Apr. 27, 2015).

83 Email from Vlad Dorjets, OIRA, to Jonathan Levy, Dept. Energy, et al., (Apr. 27, 2015, 06:10 p.m.) (OMB005178).

84 Email from Linda Wennerberg, NASA to Vlad Dorjets, OIRA (Apr. 28, 2015, 3:41 p.m.) (OMB-039145).

85 Email from Vlad Dorjets, OIRA, to Linda Wennerberg, NASA (Apr. 29, 2015, 11:52 a.m.) (OMB-039145).

86 Smith Tr. at 11 (Feb. 19, 2016).

87 See, e.g., email from Vlad Dorjets, OIRA, to Eric Gormsen, Dept. Justice (May 5, 2015, 05:52 p.m.) (OMB005850), email from Vlad Dorjets, OIRA, to Elizabeth Kohl, Dept. Energy (May 5, 2015, 05:51 p.m.) (OMB005848).

88 Email from Kenneth Kumor, NASA to Vlad Dorjets, OIRA (May 5, 2015, 6:35 p.m.) (OMB-005830).

89 Email from Shoshana Lew, Dept. Transportation, to Vlad Dorjets, OIRA (May 5, 2015, 6:23 p.m.) (OMB005821).
21

 On May 5, 2015, in addition to the shortened deadline, the DOT informs OIRA that they 

have yet to receive the Regulatory Impact Analysis (RIA), a vital piece of information for 

interagency review.90 Though OIRA ultimately provides the RIA, they nonetheless 

continued to push DOT to finalize their comments by May 11, allowing the agency only 6 

days to review the RIA and provide comment.91

 On May 13, 2015, EPA officials circulate WOTUS rollout timeline to push rule to 

finalization.92

 On May 15, 2015, Army Maj. Gen. Peabody signs memorandum advising that the Economic 

Analysis and Technical Support Document for WOTUS are deeply flawed, and the EPA 

“should not identify the corps as an author, co-author or substantive contributor”.

93

 Despite the complexity of the WOTUS rule, as well as averaging 219 days to review EPA 

proposed rules,94 on May 26, 2015, OIRA finishes its review of the WOTUS rule a mere 50 

days after receiving the final draft.95

 On May 27, 2015, the EPA Administrator Gina McCarthy and Army Assistant Secretary for 

Civil Works Jo-Ellen Darcy sign the final WOTUS rule in a ceremony hosted by the 

advocacy group Earth Conservation Corps, the National Wildlife Federation’s Washington 

D.C. affiliate.96

 The same day the EPA is hosting the rule signing ceremony with advocacy groups, officials 

with the U.S. Department of Agriculture (USDA) inform OIRA that they never received the 

Regulatory Impact Analysis (RIA), a vital piece of information for interagency review.97 In 

response, OIRA dismisses USDA’s concern, stating “[u]nfortunately, by the time I got your 

message we had already wrapped up the RIA and it would have been extremely difficult to 

re-open it at that point.”

98

 The same day a USDA official expressed dismay over mismanagement of the rulemaking 

process, citing political concerns “. . . that process was not well managed... “sometimes the 

folks across the street from you do not care about longer term issues that other agencies do 

care about.”99

 

90 Email from Shoshana Lew, Dept. Transportation to Vlad Dorjets, OIRA (May 5, 2015, 5:59 p.m.) (OMB005821).

91 Email from Vlad Dorjets, OIRA, to Shoshana, Lew Dept. Transportation (May 5, 2015, 06:30 p.m.) (OMB005821).

92 Email from Liz Purchia, EPA, to Vlad Dorjets, OIRA, et.al. (May 13, 2015, 04:55 p.m.) (OMB-036233).

93 Memorandum from Maj. Gen. John W. Peabody to Asst. Sec. of the Army for Civ. Works Jo-Ellen Darcy, 

Economic Analysis and Technical Support Documents Concerning the Draft Final Rule on Definition of “Waters of 

the United States” (May 15, 2015)

94 Office of Info. and Regulatory Affairs, Reginfo.gov, Review Counts (last visited Sept. 20, 2016).

95 Definition of "Waters of the United States" Under the Clean Water Act, Docket Folder Summary, Docket ID: 

EPA-HQ-OW-2011-0880, available at https://www.regulations.gov/docket?D=EPA-HQ-OW-2011-0880.

96 National Wildlife Foundation, A Historic Day for Clean Water, YOUTUBE (May 27, 2015), available at

https://www.youtube.com/watch?v=oCzp2rW0rIs#t=1349. 

97 Email from Vlad Dorjets, OIRA, to Robert Johansson, USDA (May 27, 2015 11:10 a.m.) (OMB-006194).

98 Id. 

99 Email from Robert Johansson, USDA to Vlad Dorjets, OIRA (May 27, 2015 11:00 a.m.) (OMB-006194).
22

June 2015 

Final Rule Published in Federal Register 

 On June 29, 2015, the final WOTUS rule is published in the Federal Register.100

Post-Rulemaking 

August 2015 

Rule Takes Effect 

 On August 28, 2015, WOTUS takes effect.101

October 2015 

Court Blocks WOTUS Nationwide

 On October 9, 2015, the U.S. Court of Appeals for the Sixth Circuit issues a stay of the Rule, 

delaying its implementation pending further action by the Court.

102

December 2015 

GAO Reports EPA Violated Anti-Lobbying Act 

 On December 14, 2015, GAO releases a report finding that EPA used appropriated funds for 

pro-WOTUS lobbying activities in violation of Anti-Lobbying Act.103

September 2016 

EPA Responds to GAO’s Anti-Lobbying Act Finding

 Administrator McCarthy disavows GAO’s findings, stating “Because no violation has 

occurred, no disciplinary action has been taken and no further steps are required on the part 

of the EPA.”

104

 

100 Clean Water Rule: Definition of “Waters of the United States,” 80 Fed. Reg. 37054 (June 29, 2015) (to be 

codified at 40 C.F.R. pts 110, 112, 116, et.al.), available at https://www.epa.gov/sites/production/files/2015-

06/documents/epa-hq-ow-2011-0880-20862.pdf.

101 The Final Clean Water Rule, available at https://www.epa.gov/cleanwaterrule/final-clean-water-rule.

102 Order of Stay, State of Ohio, et al. v. U.S. Army Corps of Eng’rs, et al. (6th Cir. 2015).

103 Letter from Susan A. Poling, General Counsel, Gov’t Accountability Office, to the Honorable James M. Inhofe, 

Chmn., Comm. on Environment and Public Works, U.S. Senate, Dec. 14, 2015, available at 

http://www.gao.gov/assets/680/674163.pdf.

104 Letter from Gina McCarthy, Administrator, U.S. Environmental Protection Agency, to Gene Dodaro, 

Comptroller General, U.S. Government Accountability Office (Sept. 15, 2016).
23

TABLE OF NAMES

U.S. Environmental Protection Agency (EPA)

 Lisa Jackson – Administrator, 2009-2013

 Gina McCarthy – Administrator, 2013-present

 Robert Sussman – Senior Policy Counsel to the Administrator

 Gregory Peck – Chief of Staff, Office of Water

 Liz Purchia – Deputy Associate Administrator for the Office of Public Affairs

U.S. Army

 Jo-Ellen Darcy – Assistant Secretary for Civil Works, 2009-present

 Craig Schmauder – Deputy General Counsel, Office of General Counsel

 Chip Smith – Assistant for Environmental, Tribal and Regulatory Affairs

 Gib Owen – Assistant Deputy, Policy and Legislation Office 

U.S. Army Corps of Engineers (Army Corps)

 Maj. Gen. John Peabody – Deputy Commanding Gen. for Civil and Emergency 

Operations

 Terrence “Rock” Salt – Principal Deputy Assistant Secretary of the Army (Civil Works)

 Jennifer Moyer – Chief of the Regulatory Program

 Meg Gaffney-Smith – former Chief of the Regulatory Program

 Paul Scodari – Economist

Office of Information and Regulatory Affairs (OIRA)

 Cass Sunstein – Administrator, 2009-2012

 Howard Shelanski – Administrator, 2013- present

 Dominic Mancini, Jr. – Deputy Administrator 

 Jim Laity – Chief of Natural Resources and the Environment

 Vlad Dorjets – Desk Officer managing review of the final rule

Small Business Administration Office of Advocacy (Advocacy)

 Dr. Winslow Sargeant – Chief Counsel

 Kia Dennis – Assistant Chief Counsel

National Aeronautics and Space Administration (NASA)

 Dr. Linda Wennerberg – Environmental Management Division 

 Kenneth Kumor – Environmental Management Division

Department of Transportation (DOT)

 Shoshana Lew – Deputy Assistant Secretary for Policy 
24

INTRODUCTION

Water is one of the planet’s most ubiquitous resources. The duty of maintaining access to 

clean water has historically fallen to state and local governments. In 1972, however, Congress 

passed the Clean Water Act (CWA) to give the federal government limited jurisdiction over 

navigable waters.105 These waters are called “navigable waters of the United States,” “navigable 

waters,” or commonly “waters of the United States” (WOTUS). Since 1972, there have been 

numerous attempts to expand the definition of navigable waters legislatively, all of which have 

failed.106 The Environmental Protection Agency (EPA) is leading the current effort to define

federal jurisdiction over water by redefining “waters of the United States” via a rulemaking the 

agency termed the “Clean Water Rule.”107

The scope of the definition for “waters of the United States” is legally significant. If a 

body of water is covered by the definition, then multiple authorities under the CWA apply, 

including a federal prohibition on discharges of pollutants (Section 301), requirements to obtain 

a permit prior to discharge (Sections 402 and 404), water quality standards and measures to 

attain them (Section 303), oil spill liability and oil spill prevention and control measures (Section 

311), certification that federally permitted activities comply with state water quality standards 

(Section 401), and enforcement (Section 309).108 As both the EPA and the U.S. Army Corps of 

Engineers (Corps) share jurisdiction over implementation of the Clean Water Act, WOTUS 

activity would be joint between EPA and the Corps.109

The History of the Definition of Navigable Waters 

Congress has been utilizing a definition of navigable waters since at least 1899.110 Since 

the Supreme Court first held in 1870 that “‘waters’ must be navigable in fact, or susceptible of 

being rendered so,” 111 the Court has “twice stated that the meaning of ‘navigable waters’ in the 

Act is broader than the traditional understanding of that term.”112 The CWA has a single 

definition of “navigable waters” that applies to the act as a whole, including the “dredge and fill” 

permit program in Section 404, the source of the Corps jurisdiction. 

 

105 33 U.S.C. §1251 et seq. (1972).

106 Claudia Copeland & Alexandra M. Wyatt, “The Wetlands Coverage of the Clean Water Act (CWA): Rapanos 

and Beyond,” Congressional Research Service, Apr. 27, 2016, available at http://www.crs.gov/Reports/RL33263.

107 Daguillard, Robert, and Lina Younes, U.S. Environmental Protection Agency, “Clean Water Rule Protects 

Streams and Wetlands Critical to Public Health, Communities, and Economy,” May 27, 2015, available at

https://yosemite.epa.gov/opa/admpress.nsf/0/62295CDDD6C6B45685257E52004FAC97.

108 Claudia Copeland, “Legislative Approach to Defining Waters of the United States,” Congressional Research 

Service, Dec. 29, 2010, available at http://www.crs.gov/pdfloader/R41225. EPA is primarily responsible for 

implementing the CWA, but EPA and the Corps share responsibilities to implement Section 404, the dredge and fill 

regulatory program.

109 33 U.S.C. §1251 et seq. (1972).

110 Rivers and Harbors Act of 1899 §10 (33 U.S.C. §403).

111 Rapanos v. United States, 547 U.S. 715, 731 (2006) (citing The Daniel Ball, 77 U.S. 557, 563 (1870)).

112 Rapanos v. United States, 547 U.S. 715, 731 (2006) (citing Solid Waste Agency of Northern Cook County v. U.S. 

Army Corps of Engineers, 531 U.S. 159, 167 (2001); United States v. Riverside Bayview Homes, Inc., 474 U.S. 121, 

133 (1985)).
25

Arguments about the scope of navigable waters continued, however, with subsequent 

Supreme Court decisions, particularly the 2001 case Solid Waste Agency of Northern Cook 

County (SWANCC) v. U.S. Army Corps of Engineers113 and the 2006 case Rapanos v. United 

States decision.114 Both of these rulings upheld congressional limits on the scope of the CWA.

 

In the Rapanos decision, a plurality of four justices, led by Justice Scalia, interpreted 

Section 404 narrowly, rejecting the Corps’ position that its authority over water was essentially 

limitless under the CWA.115 The Court found the term “waters of the United States . . . includes 

only those relatively permanent, standing or continuously flowing bodies of water ‘forming 

geographic features’ that are described in ordinary parlance as ‘streams[,] . . . oceans, rivers, 

[and] lakes.’”116 

Justice Kennedy’s concurring opinion stated a less-stringent case-by-case reading of the 

CWA, arguing that all waters with a “significant nexus” to “navigable waters” are covered.117 

The words “significant nexus” have been open to judicial interpretation and considerable 

controversy.118 The remaining four dissenting justices adhered to the prior interpretation of the 

federal government’s broad CWA jurisdiction.119

The EPA’s and the Corps’ Responses to the Court’s Decisions

In response to the Rapanos decision, the Bush Administration issued guidance in 2008 

that attempted to provide clarity to the post-Rapanos landscape.120 The guidance document 

largely hewed to the plurality opinion.121 It states:

[T]he agencies will assert CWA jurisdiction over the following waters 

without the legal obligation to make a significant nexus determination: 

traditional navigable waters and wetlands adjacent thereto, non-navigable 

 

113 Solid Waste Agency of Northern Cook County v. U.S. Army Corps of Engineers, 531 U.S. 159 (2001).

114 Rapanos v. United States, 547 U.S. 715,746 (2006) What is clear, however, is that Congress did not enact one 

when it granted the Corps jurisdiction over only “the waters of the United States.”

115 Rapanos v. United States, 547 U.S. 715 (2006).

116 Rapanos v. United States, 547 U.S. 715, 716 (2006).

117 Rapanos v. United States, 547 U.S. 715, 759-786 (2006). “In both the consolidated cases before the Court the 

record contains evidence suggesting the possible existence of a significant nexus according to the principles outlined 

above. Thus the end result in these cases and many others to be considered by the Corps may be the same as that 

suggested by the dissent, namely, that the Corps’ assertion of jurisdiction is valid. Given, however, that neither the 

agency nor the reviewing courts properly considered the issue, a remand is appropriate, in my view, for application of 

the controlling legal standard.” at 782.

118 Lawrence Hurley, Supreme Court's Murky Clean Water Act Ruling Created Legal Quagmire, Greenwire, Feb. 7, 

2011, available at http://www.eenews.net/greenwire/stories/1059944930/. 

119 For a greater discussion of Rapanos, see Claudia Copeland and Alexandra M. Wyatt, “The Wetlands Coverage of 

the Clean Water Act (CWA): Rapanos and Beyond,” Apr. 27, 2016, Congressional Research Service, available at

http://www.crs.gov/pdfloader/RL33263. 

120 Revised Mem. from Envtl. Prot. Agency & Dep't of the Army on Clean Water Act Jurisdiction Following the 

U.S. Supreme Court's Decision in Rapanos v. United States & Carabell v. United States (Dec. 2, 2008), available at

https://www.epa.gov/sites/production/files/2016-02/documents/cwa_jurisdiction_following_rapanos120208.pdf.

121 For a greater discussion of Rapanos, see Claudia Copeland and Alexandra M. Wyatt, “The Wetlands Coverage of 

the Clean Water Act (CWA): Rapanos and Beyond,” Apr. 27, 2016, Congressional Research Service, p.9, available 

at http://www.crs.gov/pdfloader/RL33263.
26

tributaries that are relatively permanent waters, and wetlands with a 

continuous surface connection with such tributaries. The agencies will also 

decide CWA jurisdiction over other non-navigable tributaries and over 

other wetlands adjacent to non-navigable tributaries based on a fact-specific 

analysis to determine whether they have a significant nexus with traditional 

navigable waters.122

On April 27, 2011, the Obama Administration issued its own draft guidance to provide 

“clarification” on the question of which bodies are under CWA jurisdiction.123 In the 2011 draft 

guidance, the EPA and the Corps defined the CWA’s reach to regulate a broad category of 

wetlands.124 This guidance document was intended to replace and supersede the Bush-era 

guidance.125

Guidance Became a Rulemaking

The Administration signaled it might replace its guidance document with a proposed rule, 

and so stated in the April 2011 draft guidance.126 On September 17, 2013, the EPA and the 

Corps announced they would no longer pursue expansion of their CWA jurisdiction through the 

guidance process, opting instead to use notice-and-comment rulemaking.127 A draft rule was 

sent to the White House Office of Information and Regulatory Affairs (OIRA) for review the 

same day.128 

In fact, the guidance had been under review at OIRA for nineteen months prior to that 

point, since February of 2012—far in excess of the 90-day maximum for OIRA’s review period 

established in Executive Order 12866.129 On April 21, 2014, the EPA and the Corps issued a 

proposed WOTUS rule.130 It broadened CWA jurisdiction from the 2008 guidance. The 

proposed rule stated:

The agencies propose to define ‘waters of the United States’ in section (a) 

of the proposed rule for all sections of the CWA to mean: Traditional 

navigable waters; interstate waters, including interstate wetlands; the 

territorial seas; impoundments of traditional navigable waters, interstate 

 

122 Revised Mem. from Envtl. Prot. Agency & Dep't of the Army on Clean Water Act Jurisdiction Following the 

U.S. Supreme Court's Decision in Rapanos v. United States & Carabell v. United States (Dec. 2, 2008), available at

https://www.epa.gov/sites/production/files/2016-02/documents/cwa_jurisdiction_following_rapanos120208.pdf.

123 Environmental Protection Agency and Army Corps of Engineers, “Draft Guidance on Identifying Waters 

Protected by the Clean Water Act,” Apr. 27, 2011, p. 1.

124 Paul Quinlan, Guidance Won't Spark 'Massive Increase' in Federal Jurisdiction—EPA Chief, E&E News PM, 

Apr. 27, 2011, available at http://www.eenews.net/eenewspm/stories/1059948298/. 

125 Environmental Protection Agency and Army Corps of Engineers, “Draft Guidance on Identifying Waters 

Protected by the Clean Water Act,” Apr. 27, 2011, p. 1.

126 Id.

127 Nancy Stoner and Lek Kadeli, EPA Science: Supporting the Waters of the U.S., EPA Connect: The Official Blog 

of EPA’s Leadership, Sept. 17, 2013, available at http://blog.epa.gov/epaconnect/2013/09/watersoftheus/. 

128 See http://www.reginfo.gov.

129 EPA Readies ‘Connectivity’ Study to Bolster Clean Water Jurisdiction Policy, Inside EPA, Feb. 16, 2012.

130 Clean Water Act; Definitions: “Waters of the United States,” Reg. Identifier No. 2040-AF30, Docket ID: EPAHQ-OW-2011-0880, available at https://www.regulations.gov/docket?D=EPA-HQ-OW-2011-0880.
27

waters, including interstate wetlands, the territorial seas, and tributaries, as 

defined, of such waters; tributaries, as defined, of traditional navigable 

waters, interstate waters, or the territorial seas; and adjacent waters, 

including adjacent wetlands. Waters in these categories would be 

jurisdictional ‘waters of the United States’ by rule—no additional analysis 

would be required. The agencies emphasize that the categorical finding of 

jurisdiction for tributaries and adjacent waters was not based on the mere 

connection of a water body to downstream waters, but rather a 

determination that the nexus, alone or in combination with similarly situated 

waters in the region, is significant based on data, science, the CWA, and 

caselaw.131

The comment period for the rule was extended twice, to November 14, 2014.132 A final 

draft of the rule was sent to OIRA for review on April 6, 2015, and the final rule was released on 

May 27, 2015.133 The final rule defines eight waterbodies as falling within the CWA jurisdiction. 

The rule states:

The first three types of jurisdictional waters, traditional navigable waters, 

interstate waters, and the territorial seas, are jurisdictional by rule in all 

cases. The fourth type of water, impoundments of jurisdictional waters, is 

also jurisdictional by rule in all cases. The next two types of waters, 

‘tributaries’ and ‘adjacent’ waters, are jurisdictional by rule, as defined, 

because the science confirms that they have a significant nexus to traditional 

navigable waters, interstate waters, or territorial seas. For waters that are 

jurisdictional by rule, no additional analysis is required.

The final two types of jurisdictional waters are those waters found after a 

case-specific analysis to have a significant nexus to traditional navigable 

waters, interstate waters, or the territorial seas, either alone or in 

combination with similarly situated waters in the region.134

A recently-published report by the Senate Committee on Environment and Public Works 

notes the final rule allowed for the agencies to broadly claim jurisdiction, including for puddles, 

tire ruts, sheet flow, and standing water. 135 Under the new rule, these features could be 

 

131 Clean Water Rule: Definition of “Waters of the United States,” Reg. Identifier No. 2040-AF30, Docket ID: EPAHQ-OW-2011-0880-20862, available at https://www.regulations.gov/docket?D=EPA-HQ-OW-2011-0880.

132 Definition of Waters of the United States under the Clean Water Act, Reg. Identifier No. 2040-AF30, Docket ID:

EPA-HQ-OW-2011-0880-2733; see also Definition of Waters of the United States, Reg. Identifier No. 2040-AF30, 

Docket ID: EPA-HQ-OW-2011-0880-7500, available at https://www.regulations.gov/docket?D=EPA-HQ-OW2011-0880.

133 Clean Water Rule: Definition of “Waters of the United States,” Reg. Identifier No. 2040-AF30, Docket ID: EPAHQ-OW-2011-0880-20862, available at https://www.regulations.gov/docket?D=EPA-HQ-OW-2011-0880.

134 Id.

135 Majority Staff, From Preventing Pollution of Navigable and Interstate Waters to Regulating Farm Fields, Puddles 

and Dry Land: A Senate Report on the Expansion of Jurisdiction Claimed by the Army Corps of Engineers and the 

U.S. Environmental Protection Agency under the Clean Water Act, S. COMM. ON ENVIRONMENT AND PUBLIC 

WORKS, Sep. 20, 2016, available at http://www.epw.senate.gov/public/_cache/files/99dc0f4b-50a8-4b9e-a604-

cb720e7f19bc/wotus-committee-report-final1.pdf.
28

reclassified as “disturbed wetlands” and regulated by the EPA. Further, if farmers change their 

land use from one form of agriculture to another, such as from crops to grazing, this could be 

considered a “new use,” rendering certain farmers vulnerable to losing their agricultural 

exemption. 

The final rule also created an arbitrary standard whereby waters within 4,000 feet from 

any jurisdictional water would be covered. The rule states:

[W]aters within the 100-year floodplain of a traditional navigable water, 

interstate water, or the territorial seas and waters within 4,000 feet of the 

high tide line or the ordinary high water mark of a traditional navigable 

water, interstate water, the territorial seas, impoundments, or covered 

tributary are subject to case-specific significant nexus determinations, 

unless the water is excluded under paragraph (b) of the rule.136

 

136 Final Rule: https://www.epa.gov/sites/production/files/2015-06/documents/epa-hq-ow-2011-0880-20862.pdf
29

POLITICAL CONSIDERATIONS DROVE THE WOTUS RULEMAKING

FINDING: The agencies pushed the rule through on an accelerated timeline 

that appeared to have been motivated by political considerations. 

Some officials involved in the process believed politics deprived 

them the opportunity to conduct a meaningful and full review of 

the rule before its promulgation. Interagency reviewers and the 

White House were not provided the full rule package for review.

Since assuming office, the Obama Administration made it a priority to promulgate an 

expansion of the defined “waters of the United States” under the jurisdiction of the CWA. Chip 

Smith, Assistant for Environment, Tribal and Regulatory Affairs for the Office of the Assistant 

Secretary of the Army (Civil Works) testified to the Committee in a transcribed interview that 

Administration officials were already pushing a WOTUS rule before political leadership could

even be set up in the Office of the Assistant Secretary of the Army for Civil Works. Smith 

testified:

Q Okay. How long have you been involved in the Waters of the 

United States rule? 

A Since February of 2009, what I understand to be the very first 

meeting of principals where EPA announced their intention to 

pursue this rule, and I was there because we did not yet have 

appointees, so I was the only man standing. I went. 

Q I see. And in that capacity, what did you do with respect to the 

rulemaking? 

A Well, I mostly listened while Administrator Jackson and her 

senior attorney, Bob Sussman, announced that they wanted to do 

a rule on the Clean Water Act and that they intended to move 

ahead, that it was their opinion that the Clean Water Act was 

their act, and that while it was a joint regulation we were 

replacing, they fully expected EPA would fully control the 

rulemaking and the process. 

Q And can I clarify whose belief was that? 

A Administrator Jackson personally, I sat next to her, and Robert 

Sussman.137

According to Smith’s testimony, in early meetings, then-EPA Administrator Lisa Jackson 

and her top aide, Robert Sussman, pushed to accelerate the process, starting with the initial 

 

137 Smith Tr. at 58 (Jan. 21, 2016).
30

WOTUS guidance document, which was later withdrawn and replaced with more formal 

rulemaking.138 Smith stated that such a demand conflicted with procedural and practical 

rulemaking considerations, especially given the complexity of the WOTUS effort. Smith 

testified:

Q And you mentioned that there was an effort to complete the 

[WOTUS] guidance quickly? 

A Uh huh.

Q Who was trying to complete it quickly? 

A The [EPA] administrator and Robert Sussman. 

Q Are you aware of why they were trying to complete it quickly?

A Well, when I was in that initial couple of meetings when there were 

no appointees and I was the only one who could go from Army, they 

just said they thought they knew what the answer was, they thought 

they ought to move quickly fast. It was early in the administration, 

let’s ride this wave and let’s get it done. 

And there was thinking that [the] guidance could be written fairly 

quickly, but if you’ve looked at some of this stuff, it’s really hard. I 

mean, it’s one thing to write the words, but then how it plays out in 

the field is tough. Nature is hard to describe, and so we got kind of 

you know, I’m not pointing fingers at anybody here; it’s just hard to 

do that.139 

Top-level interest continued into 2012, as the Administration was preparing WOTUS 

guidance. In an email from March of that year, OIRA staff discussed the White House Chief of 

Staff’s commitments on WOTUS to environmentalist groups.140 On March 29, 2012, the Chief 

of the Natural Resources and Environmental Branch, Jim Laity, wrote to his colleagues 

regarding the draft Clean Water Act guidance: “This is a very big deal. I understand COS has 

promised enviros it will be done ‘soon.’” 

 

138 Id. at 16.

139 Id. at 16-17.

140 Email from Jim Laity, OIRA to Shayna L. Strom, OIRA (Mar. 29, 2012, 2:12 p.m.) (OMB-041300).
31

Emails obtained by the Committee show that as work on WOTUS continued, the EPA 

communicated with environmentalist groups and provided special access as the process moved 

forward. For example, on September 16, 2013, EPA Deputy Chief of Staff Arvin Ganesan wrote 

“I think we should - on an embargoed basis - give the WOTUS final public doc to select groups 

who will say positive things.”

141

 

The emails also show the EPA Administrator was directly involved in the rulemaking 

process, even after Administrator Lisa Jackson was replaced by Gina McCarthy in 2013. In an 

email from November of that year, OIRA staff wrote: “OW [EPA Office of Water] staff told me 

that Gina has insisted that policy issues go straight to her, without trying to work them at a lower 

level first.”

142

Documents and testimony show that as the rulemaking proceeded, the EPA continued to 

dominate the rulemaking schedule. Smith testified that EPA Administrator Jackson’s successor, 

Gina McCarthy, continued aggressively pushing the rule forward, and set an uncompromising 

timeline for releasing the final WOTUS rule in May 2015.143 For example, documents show that 

in early 2013, McCarthy attempted to downplay the economic impact of the rule, which would 

have resulted in more deliberation and a deeper examination that would slow WOTUS.144 

 

141 Email from Arvin Ganesan, EPA, to Sarah Bittleman, EPA, et al. (Sept. 16, 2013, 2:56 p.m.) (OMB-034495).

142 Email from Jim Laity, OIRA, to Cortney Higgins, OIRA (Nov. 26, 2013, 5:49 p.m.) (OMB-037507).

143 Smith Tr. at 13 (Feb. 19, 2016).

144 Email from Jim Laity, OIRA, to Dominic Mancini, Cortney Higgins, and Andrei Greenawalt, OIRA (Nov, 7, 

2013, 10:04 a.m.) (OMB-045654).
32

Staff at the Army told the Committee that politics appeared to play a role in the push for 

them to move forward on WOTUS. Jennifer Moyer, Chief of the Regulatory Program at the 

Corps, testified:

Q We discussed a little bit about the rush and the fact that there was 

a set deadline, that there was a target, anyway, of when this rule 

was going to be finalized or delivered for final interagency 

review. Do you personally believe that politics played a role in 

the rulemaking timeline? 

A I can’t say definitively that it did, but it appears that it did.145 

Chip Smith testified that the push for the rule was politically motivated. He stated:

Q Do you believe that politics played a role in the timeline to roll 

out this rulemaking? 

A Yes. 

Q And why do you say that? 

A The schedule was driven by politics; the policy decisions, 

some of them, in my opinion, were driven by politics; and in 

particular, several of the last minute changes in the last few 

months, in my view, were not science or economic based, but 

driven solely by politics.146 

* * *

Q In a previous round, you commented that politics played a role 

in rulemaking. What was your basis for saying that?

A Several statements from EPA staff that this is a chance to grab 

as much jurisdiction as we can, and then statements on the other 

side of the equation if we don’t change the rule and take 

something off the table, Secretary Vilsack will be angry. This is 

Greg Peck. If we don’t do something for ditches along roadsides, 

DOT may not chop on the rule. And I can come up with other 

examples if I had to, but instead of talking about the science and 

what’s the right answer in terms of tributaries and what to 

regulate and not regulate, there was this constant jockeying for 

how do we get the rule out the door on a nonscientific basis 

adjusting the rule to meet people’s concerns or other agencies’

concerns. To me, that’s a political thing, not a science-based 

 

145 Moyer Tr. at 35 (Dec. 17, 2015).

146 Smith Tr. at 40 (Jan. 21, 2016).
33

thing.147

Smith further testified:

Q Were you ever told in any way, or feel pressure to achieve the 

administration’s objective in this rulemaking?

A Yes.

Q How so? 

A Typically, we’re provided a problem, we study it, we assess it, 

we come up with alternatives, we propose a solution. The boss 

picks one, and we proceed. 

In this case, we were told the answer up front pretty much. 

We really were not allowed to do the science and study options 

and alternatives. We went towards one goal and one goal only 

for 6 years, which is probably the reason we meandered so much, 

and so there was constant pressure to get from a predetermined 

initial policy point to a final point that was as close as possible 

to that, and the only give was to take some jurisdictional waters 

off the table to help with concerns expressed by USDA and 

farmers. 

Q And these were some of the reasons you mentioned that you felt 

the rule was political. Is that correct?

 

A That’s correct. That, along with the interpretive rule. 

Q And you would say that this process that you just outlined, 

studying a problem, coming up with solutions, evaluating 

alternatives, proposing, and making a decision is part of a normal 

rulemaking process? 

A That’s correct. 

Q Even in the case of a joint rulemaking between the EPA and 

Army Corps? 

A That’s correct. 

Q At any other point in your tenure, besides working on WOTUS, 

did you feel pressure to conduct your work or data analysis to 

achieve a certain result? 

 

147 Id. at 179.
34

A No. 

Q Would you say that your experience with WOTUS rulemaking is 

unprecedented in the manner in which your work was managed? 

A Yes.148

Documents and testimony show that OIRA staff acknowledged WOTUS rulemaking was 

a high regulatory priority for the Administration. This message was communicated to OIRA 

through increased pressure and attention to the rulemaking. Jim Laity testified that senior OIRA 

leadership communicated the Administration’s concerns to him directly. Laity stated: “There 

was a lot of concern that to me was communicated from the senior leadership of OIRA.”

149

 

Laity further testified the Administration can and does influence the OIRA review process. He 

stated: 

Q In your time at OIRA, have you ever received such direction to 

make sure a rule makes it through the review process? 

A Yes. 

Q Do you recall which proposals those would include? 

A The most common case when that happens is when there is a 

judicial deadline for review, a court-ordered deadline. And then 

we try very hard to meet those court-ordered deadlines, and that 

sometimes requires a very compressed review. 

Occasionally, there could also be a very high-profile rule where 

the administration has made a public commitment to get 

something done by a particular time. And then we would also be 

aware of that and do our very best to meet that deadline.150 

* * *

It is not uncommon for my boss, Howard Shelanski, whom I 

work for and who gives me direction, to tell me that there is a 

desire on the part of the administration to get a rule done on a 

particular schedule. And there have been other rules in this 

administration and in other administrations where I have 

received that kind of instruction from the Administrator of 

 

148 Smith Tr. at 89-91 (Feb. 19, 2016).

149 H. Comm. on Oversight & Gov’t Reform, Transcribed Interview of Jim Laity, Tr. at 25 (Mar. 8, 2016). 

[hereinafter Laity Tr.]

150 Id. at 165. (emphasis added)
35

OIRA.

151

 

As a general rule, the White House plays an important role in OIRA’s regulatory review. 

OIRA is aware of the influence of political offices and gives deference to political decision 

makers. Laity testified to the Committee: 

I think it’s fair to say that we give a little more weight or pay a little 

more attention to comments from the Executive Office, you know, EOP 

offices because they are—each of them has their own fairly senior 

decision maker within the White House or within the EOP. 152

According to Laity, OIRA specifically solicits feedback from the Council on 

Environmental Quality (CEQ), Council of Economic Advisers, the Office of Science and 

Technology Policy, the Domestic Policy Council, White House counsel’s office, and the Office 

of the U.S. Trade Representative.153

The EPA Funded an Improper Grassroots Lobbying Effort

The documents show the Administration engaged in an advocacy effort to create the 

appearance of grassroots support for WOTUS. The non-partisan Government Accountability 

Office (GAO) found the EPA violated restrictions on lobbying and propaganda in its social 

media efforts to drum up support for the WOTUS rule in 2014 and 2015.154 GAO took issue 

with the EPA’s use of a software program called Thunderclap, which allows for a particular 

message to be spread across multiple social media platforms, such as Facebook and Twitter, 

simultaneously.155 Specifically, GAO noted that the EPA used Thunderclap to send messages 

supporting WOTUS to approximately 1.8 million people.156 Due to the nature of Thunderclap, 

however, it was not clear to these recipients that the EPA, a federal government agency, had 

authored the messages.157 As such, GAO wrote “we conclude that EPA’s use of Thunderclap 

constitutes covert propaganda, in violation of the publicity or propaganda prohibition.”

158

 

GAO found that the EPA also violated laws barring federal agencies from engaging in or 

encouraging lobbying of Congress.159 The violation in question stems from a blog post written 

by EPA Communications Director for Water Travis Loop published on the EPA’s website. The 

blog post touted the Clean Water Rule and urged readers to post pictures of themselves showing 

 

151 Id. at 167. (emphasis added)

152 Id. at 24.

153 Id. at 55.

154 Letter from Susan A. Poling, General Counsel, Gov’t Accountability Office, to the Honorable James M. Inhofe, 

Chmn., Comm. on Environment and Public Works, U.S. Senate, Dec. 14, 2015, available at

http://www.gao.gov/assets/680/674163.pdf.

155 Id, at 3.

156 Id. at 13-14.

157 Id. at 12.

158 Id. at 11.

159 Id.
36

support for the rule on various social media outlets.160 Loop’s blog post also provided hyperlinks 

to two environmentalist group websites: The Surfrider Foundation and the Natural Resources 

Defense Council (NRDC).161 Those websites contained links enabling users to contact Congress 

and lobby in favor of WOTUS. GAO found that arrangement to be improper. GAO stated: “We 

also conclude that EPA hyperlinks to the NRDC and Surfrider Foundation webpages provided in 

the EPA blog post constitute grassroots lobbying, in violation of the grassroots lobbying 

prohibition.”

162

 Based upon these findings, GAO concluded: 

Because EPA obligated and expended appropriated funds in violation of 

specific prohibitions, we also conclude that EPA violated the 

Antideficiency Act, 31 U.S.C. § 1341(a)(1)(A), as the agency’s 

appropriations were not available for these prohibited purposes. 

Accordingly, EPA should report the violation to the President and Congress, 

with a copy to the Comptroller General, as required by the Antideficiency 

Act.163 

The EPA responded to GAO’s findings about the problematic blog post by Travis Loop 

three days later, in another blog post, this time by Liz Purchia, the Deputy Associate 

Administrator for the Office of Public Affairs. Purchia criticized GAO as “backward-thinkers”

and dismissed GAO’s findings with respect to the EPA’s promotional activities for the Clean 

Power Plan and WOTUS rule. Purchia wrote: 

It’s almost 2016. One of the most effective ways to share information is via 

the Internet and social media. Though backward-thinkers might prefer it, 

we won’t operate as if we live in the Stone Age. 

* * *

At no point did the EPA encourage the public to contact Congress or any 

state legislature about the Clean Water Rule. Plain and simple. The rule is 

an agency action, promulgated by EPA. It’s not even about congressional 

legislation.164

On September 15, 2016, more than nine months later, the EPA formally responded to 

GAO in a letter signed by Administrator McCarthy.165 McCarthy disavowed GAO’s findings 

 

160 Travis Loop, Communications Director-Office of Water, U.S. Environmental Protection Agency, Tell Us Why 

#CleanWaterRules, Our Planet, Our Home: EPA’s Blog About Our World, Apr. 7, 2015, available at

http://blog.epa.gov/blog/2015/04/tell-us-why-cleanwaterrules/.

161 Letter from Susan A. Poling, General Counsel, Gov’t Accountability Office, to the Honorable James M. Inhofe, 

Chmn., Comm. on Environment and Public Works, U.S. Senate, Dec. 14, 2015, available at

http://www.gao.gov/assets/680/674163.pdf.

162 Id.

163 Id. at 26.

164 Liz Purchia, Deputy Associate Administrator, Office of Public Affairs, EPA, We Won’t Back Down from our 

Mission, EPA CONNECT (Dec. 17, 2015, 6:19 p.m.), https://blog.epa.gov/blog/2015/12/we-wont-back-down-fromour-mission/.

165 Letter from Gina McCarthy, Administrator, U.S. Environmental Protection Agency, to Eugene Dodaro, 

Comptroller General, U.S. Government Accountability Office (Sept. 15, 2016) (on file with Committee staff).
37

and stated that the EPA took no action in response to the findings. She wrote: “Because no 

violation has occurred, no disciplinary action has been taken and no further steps are required on 

the part of the EPA.”

166

Army and Corps officials stated that the public affairs components of the Clean Power 

Plan and WOTUS rule were not typical to the normal rulemaking process. Chip Smith testified:

Q The committee understands that the Army made some requests 

to the Army Corps to engage in social media promotion of the 

rule during its development, including tweeting, posting 

comments online—or content online, and participating in the 

social media platform Thunderclap. Were you aware of these 

efforts to promote the draft rule? 

A I was aware of the efforts to promote the draft rule, and advised 

against it. 

Q And why did you advise against it? 

A We have never social media’d, in my 36 years of experience, a 

rule like this. I’m not saying it’s lobbying, but it gives the 

perception of sort of lobbying for what you want to do, and we 

just thought—considering how contentious this rule was, myself 

and several others in the Corps thought it was not a good idea, 

but we didn’t have any real control over that.167

Jennifer Moyer testified:

Q So as we are talking about your understanding of this so called 

thunderclap solicitation of comments, were you aware of this at 

the time that it was being done? 

A I wasn’t aware at the time. I became aware after, and this was 

after the rule was finalized and there were requests from Army 

for us to tweet and put stuff on our headquarters’ Facebook page, 

and it was then that Stacy Jensen mentioned that there had been 

a request from EPA for us to participate in the thunderclap. And 

that’s when I became aware that this thunderclap effort 

had happened.168

 

166 Id.

167 Smith Tr. at 41 (Jan. 21, 2016).

168 Moyer Tr. at 44 (Dec. 17, 2015).
38

Politics Influenced the Timeline for Releasing the Rule

Documents and testimony show that political pressure affected the entire WOTUS 

rulemaking and led the Administration to prioritize speed over a thorough and thoughtful 

process. Staff responsible for conducting the rulemaking were repeatedly rushed, often without 

any explanation. The public comment period closed November 14, 2014, and almost

immediately thereafter, staff were rushed to complete the rulemaking as quickly as possible. 

Jennifer Moyer testified “there was a sense of urgency,” which led her to bring on additional 

staff to try to complete the rulemaking work and the review of public comments as quickly as 

possible.169 Moyer testified that Craig Schmauder made her aware of the sense of urgency 

surrounding the rulemking.170 Schmauder is an attorney with the Army’s Office of General 

Counsel, who led the Army and the Corps through the WOTUS rulemaking:

171

 Moyer stated:

Q Who expressed that sense of urgency to you? 

A I was hearing that from Craig Schmauder. 

Q Were you given any timeline for when the review of the 

comments needed to be concluded?

 

A At that point in time, why I brought the staff in when I did is 

that’s when I was hearing early 2015 was what we were shooting 

for.172 

The Rule was submitted to OIRA for review in April 2015. At that time, the EPA 

informed OIRA staff of their expectation that OIRA would complete the review in less than the 

90-day time period provided by Executive Order 12866. During an interview, Laity testified to 

the Committee that there was concern about this timing. Laity stated: 

Q Were you aware of any timeframe or deadline set for the rule’s 

development or finalization? 

A I do not remember the details of those discussions, but I do 

remember that there was a lot of concern that to me was 

communicated from the senior leadership of OIRA, but they may 

well have been talking to other people, I don’t know, and that we 

certainly at various points in time were trying to make 

deadlines.173

 

169 Id. at 30. (emphasis added)

170 Id.

171 Schmauder Tr. at 10 (Feb. 17, 2016).

172 Moyer Tr. at 32 (Dec. 17, 2015).

173 Laity Tr. at 25-26 (Mar. 8, 2016).
39

Documents show EPA sought a commitment from OIRA that it would complete the 

review within 60 days.174 OIRA staff had numerous concerns with that timeline, however,

including insufficient supporting documentation and the speed at which they could complete the 

interagency comment process.175 Laity detailed some of these concerns and discussion in an 

email to OIRA Administrator Howard Shelanski on April 14, 2015 after a meeting between staff 

from OIRA, the Corps, and the EPA.

176

 Regarding the meeting, Laity wrote: “Several process 

issues came up.”

177

 Laity referred to EPA’s request for a 60-day review and an insufficient 

preamble drafted in a manner directed by EPA Administrator Gina McCarthy herself. 

 

174 Email from Jim Laity, OIRA, to Howard Shelanski, Dom Mancini, and Katie Johnson, OIRA (Apr. 14, 2015, 

6:27 p.m.)

175 Id.

176 Id.

177 Id.
40

Despite these concerns and the “frantic” pace of the work, OIRA completed the WOTUS 

review in just 50 days.178 

 

178 Id.
41

OIRA’s Review was Rushed

OIRA staff were directed to complete their review on a rushed timeline. To 

accommodate the aggressive timeline, the agency omitted a complete review of rulemaking 

processes, supporting documentation, and interagency comments. OIRA received the final 

WOTUS rule on April 6, 2015 for review.179 Executive Order 12866 allows OIRA to review 

regulations for 90 days plus additional time as requested by the Administrator or the agency.180 

OIRA completed the review on May 26, 2015, fifty days after receiving the final rule text.181

Fifty days to review a rule is short by OIRA standards, especially for a complicated rule 

originating with the EPA. In 2014, OIRA averaged 127 days per review.182 For EPA rules, the 

average review was even longer—219 days.183

In 2015, OIRA sped up its review time significantly, particularly for EPA rules. Overall, 

the average review time dropped to 88 days—approximately 30 percent shorter.

184 For EPA 

rules, OIRA averaged 89 days to review a rule, nearly 60 percent shorter than the previous 

year.185 OIRA Administrator Howard Shelanski told the Committee that he has made an effort to 

shorten review times.

186

 Even by OIRA’s improved standards, however, the WOTUS review 

was uniquely brief. 

Documents show that for the WOTUS rulemaking, OIRA staff felt that a 60-day deadline 

was unreasonable and could compromise their review. An email between OIRA staff in March 

2015 detailed OIRA’s timing concerns and acknowledged EPA was unable even then to produce 

documents to OIRA on this schedule.

187

 Jim Laity wrote: “We can meet a schedule of 60 days 

on WOTUS if necessary, but it may compromise the thoroughness of our review.”

188

 

179 Office of Info. and Regulatory Affairs, Reginfo.gov, Historical Reports, RIN 2040-AF16 (last visited June 30, 

2016). 

180 E.O. 12866, 58 Fed. Reg. 51005 (Sept. 29, 1993). 

181 Office of Info. and Regulatory Affairs, Reginfo.gov, Historical Reports, RIN 2040-AF16 (last visited June 30, 

2016).

182 Office of Info. and Regulatory Affairs, Reginfo.gov, Review Counts (last visited Sept. 20, 2016).

183 Id.

184 Id. 

185 Id.

186 H. Comm. on Oversight & Gov’t Reform, Transcribed Interview of Howard Shelanski, Tr. at 10-11 (May 13, 

2016).

187 Email from Howard Shelanski, OIRA, to Stuart Levenbach, OIRA, et al. (Mar. 25, 2015, 5:19 p.m.) (OMB037023).

188 Email from Jim Laity, OIRA to Howard Shelanski, OIRA, et al. (Mar. 25, 2015, 5:00 p.m.) (OMB-037023).
42

Even as early as the proposed rule stage, the agencies were struggling to meet the 

accelerated schedule. Documents show OIRA staff acknowledged they were working to meet an 

early-January 2013 deadline due to numerous complications such as interagency review and 

negotiating recommended changes to the rule. In December 2013, Laity wrote to his colleagues: 

“At this point it will already be very challenging to finish up by the first week in January as we 

had been targeting.”

189

 

 

189 Email from Jim Laity, OIRA, to Howard Shelanski, OIRA, et al. (Dec. 18, 2013, 1:59 p.m.) (OMB-038003).
43

Executive Order 12866 requires OIRA to complete a thorough review of the regulatory 

requirements and provides for interagency review of proposed regulations. OIRA facilitates an 

interagency review to “provide meaningful guidance and oversight so that each agency’s 

regulatory actions . . . do not conflict with the policies or actions of another agency.”

190

 

Documents obtained by the Committee show the WOTUS interagency review process was 

rushed and mismanaged, leading to frustration from other federal agencies potentially affected 

by the rule.

On Monday April 27, 2015, Vlad Dorjets, the OIRA desk officer managing review of the 

final rule, sent the rule out for interagency review.191 He requested a response by Monday, May 

 

190 E.O. 12866, 58 Fed. Reg. 51005, Sec. (6)(b) (Sept. 29, 1993). 

191 Email from Vlad Dorjets, OIRA, to Jonathan Levy, Dept. Energy, et al., (Apr. 27, 2015, 06:10 p.m.) (OMB005178).
44

11, allowing agencies just two weeks to review the rule.192 Agencies responded by asking for 

additional time to review the complex rule.193 OIRA denied those requests.

194

 

On Tuesday, May 5, 2016, Dorjets emailed each of the agencies involved in the 

interagency review process and requested their comments even sooner. He wrote: “The pressure 

on WOTUS/Clean Water Rule is getting turned up from on high and I have been asked to do 

whatever I can to provide all comments back to EPA by the end of the week.”

195

 

In response to Dorjets’ original request for comments, NASA asked for an extension, so 

it could include the relevant field centers in the review process.196

 

192 Email from Vlad Dorjets, OIRA, to Jonathan Levy, Dept. Energy, et al., (Apr. 27, 2015, 06:10 p.m.) (OMB005178).

193 See, e.g., email from Linda Wennerberg, NASA to Vlad Dorjets, OIRA (Apr. 28, 2015, 3:41 p.m.) (OMB039145).

194 Email from Vlad Dorjets, OIRA, to Linda Wennerberg, NASA (Apr. 29, 2015, 11:52 a.m.) (OMB-039145).

195 See, e.g., email from Vlad Dorjets, OIRA, to Eric Gormsen, Dept. Justice (May 5, 2015, 05:52 p.m.) (OMB005850), email from Vlad Dorjets, OIRA, to Elizabeth Kohl, Dept. Energy (May 5, 2015, 05:51 p.m.) (OMB005848).

196 Email from Linda Wennerberg, NASA to Vlad Dorjets, OIRA (Apr. 28, 2015, 3:41 p.m.) (OMB-039145).
45

OIRA rejected NASA’s request for an extension. Then, after Dorjets followed up by 

reducing the review period even further, a NASA official responded: “You’re killing us. . . . I 

think it’s fair to say that the powers that be are more interested in schedule (apparently 

compressed) than a reasoned response that objectively lays out likely ramifications. . . We will 

do our best, but NASA’s response may be raw, less than comprehensive, and overall less than is 

needed to properly weigh the implications of the new definition of WOTUS on NASA and our 

proud nation as a whole.”

197

 

197 Email from Kenneth Kumor, NASA to Vlad Dorjets, OIRA (May 5, 2015, 6:35 p.m.) (OMB-005830).
46

The Department of Transportation (DOT) also responded with concerns about the 

shortened time period.198

According to Dorjets, he was not in control of the deadline. He replied to DOT’s request 

for an extension: “I’ll do everything I can on my end to buy you some more time but it may be 

out of my control.”

199

 

 

198 Email from Shoshana Lew, DOT, to Vlad Dorjets, OIRA (May 5, 2015, 6:34 p.m.) (OMB-005821).

199 Email from Vlad Dorjets, OIRA, to Shoshana Lew, DOT (May 5, 2015, 6:34 p.m.) (OMB-005821).
47

In addition to the short deadline for review, agencies were further hampered by not 

receiving key documents necessary to conduct the review. The lack of sufficient documentation, 

however, did not slow down the review. For example, when DOT explained that they had not 

yet received the regulatory impact analysis (RIA),

200 Dorjets forwarded the RIA, but continued 

to push DOT to meet the original deadline of May 11, referring again to pressure from above.

201

 

He stated: “If needed, I can send the other comments to EPA and the Corps and let them know 

that you’re [sic] agency’s comments will be provided later but I can’t gaurantee [sic] how that 

will go over given the pressure to get this rule out the door.”

202

On May 27, 2015, a U.S. Department of Agriculture (USDA) official emailed Dorjets 

and noted that the rule was to be announced that day. The USDA official asked Dorjets whether 

the RIA was complete or still in development. Dorjets replied that OIRA had already concluded 

its review on the Economic Analysis, and wrote: “[u]nfortunately, by the time I got your 

message we had already wrapped up the RIA and it would have been extremely difficult to reopen it at that point.”

203

The USDA official responded: “. . . that process was not well managed. There was 

no return solicitation for agencies to see what EPA had proposed (or not) changing in 

response to comments. . . .” and “sometimes the folks across the street from you do not care 

about longer term issues that other agencies do care about.”204

 

200 Email from Shoshana Lew, DOT, to Vlad Dorjets, OIRA (May 5, 2015, 6:34 p.m.) (OMB-005821).

201 Email from Vlad Dorjets, OIRA, to Shoshana Lew, DOT (May 5, 2015, 6:34 p.m.) (OMB-005821).

202 Id. (emphasis added)

203 Email from Vlad Dorjets, OIRA, to Robert Johansson, USDA (May 27, 2015 11:10 a.m.) (OMB-006194).

204 Id. (emphasis added)
48

Dorjets replied: “The real challenge here was working on a very tight schedule which 

required me to provide short deadlines. To the extent that Agencies were able to provide me 

comments . . . I did all that I could to address them with EPA and the Corps . . . but even then 

there was only so much that I could do.”

205

When Committee staff questioned OIRA staff about the shortened time period and the 

pressure to complete the rule, none of the witnesses could clearly recall. Laity testified: 

Q In the course of this rulemaking, did you ever receive or were you 

aware of any suggestion or direction to conduct your review in a 

certain timeframe? 

A As I said before, I believe there were timeframes and deadlines, but 

I don't remember exactly what they were.206

Dorjets stated:

Q And you don’t recall why the review period was shortened?

A No. That I do not.207

Dorjets further testified: “There may be a reason why a rule needs to come out on a certain date. 

Whether that is a press release or a legal obligation, sometimes a rule is being issued because it’s 

a court order.”

208

 

205 Id. (emphasis added)

206 Laity Tr. at 164 (Mar. 8, 2016).

207 H. Comm. on Oversight & Gov’t Reform, Transcribed Interview of Vlad Dorjets, Tr. at 33 (May 10, 2016).

208 Id. at 53. 
49

In the case of the WOTUS rule, there were no court orders or legal obligations in place at 

the time. There was, however, a press release on May 27, 2015, to announce the issuance of the 

final rule.209 

On May 13, 2015, EPA officials sent a “Clean Water Rule Rollout” to OIRA that detailed

the timeline for publicizing the final rule.210 An EPA official emailed the plan to Dorjets, and 

wrote “tick tock.”

211

 Dorjets forwarded the email to his colleagues, and expressed regret that the 

EPA left OIRA out of the planning. He stated: “Very surprised – and disappointed – we’re not 

being included.”

212

 

209 Press Release, EPA, “Clean Water Rule Protects Streams and Wetlands Critical to Public Health, Communities, 

and Economy (May 27, 2015), available at https://www.epa.gov/newsreleases/clean-water-rule-protects-streamsand-wetlands-critical-public-health-communities-and.

210 Email from Liz Purchia, EPA, to Vlad Dorjets, OIRA, et.al. (May 13, 2015, 04:55 p.m.) (OMB-036233).

211 Id.

212 Email from Vlad Dorjets, OIRA, to Dominic Mancini, OIRA, Jim Laity, OIRA (May 18, 2015, 12:57 p.m.) 

(OMB-036233).
50

EPA EXCLUDED THE CORPS FROM THE “JOINT” RULEMAKING PROCESS

FINDING: The U.S. Army Corps of Engineers, which shares jurisdiction over 

the Clean Water Act, was cut out of the rule development process.

Despite a noted track record of successfully working together on other joint 

rulemakings,213 the EPA failed to include the Corps in this rulemaking. This failure resulted in 

major inadequacies in the rule.

Joint Rulemaking is an often-used tool for the federal government to ensure that certain 

agencies with a particular expertise can work together in developing a more streamlined and 

efficient set of rules, which saves taxpayers money and sets forth a clearer path towards 

compliance for those affected by the proposed rule.214 However, that potential “can be wasted if 

the agencies work at cross-purposes or fail to capitalize on one another’s unique strengths and 

perspectives.”

215

 Such was the thought when Congress left it to the Corps and the EPA to define 

the term “waters of the United States” under the Clean Water Act.216 Because the WOTUS Rule 

can potentially affect every American in some capacity, having the two agencies act 

independently under their respective statutes would likely cause significant duplication and 

potentially conflicting requirements.217 Indeed, the EPA itself recognized that the rule was a 

joint effort in the first line of the proposed rule’s preamble:

The Environmental Protection Agency (EPA) and the U.S. Department of 

the Army (Army) are publishing a final rule defining the scope of waters 

protected under the Clean Water Act (CWA or the Act), in light of the 

statute, science, Supreme Court decisions in U.S. v. Riverside Bayview 

Homes, Solid Waste Agency of Northern Cook County v. U.S. Army Corps 

of Engineers (SWANCC), and Rapanos v. United States (Rapanos), and the 

agencies’ experience and technical expertise.218

The significance of the Corps’ participation in the rulemaking is highlighted by 

Congress’ decision to convey upon it the duty to administer Section 404 of the CWA, which 

 

213 Moyer Tr. at 17, 154-155 (Dec. 17, 2015). 

214 Admin. Conf. of the United States, Improving Coordination of Related Agency Responsibilities (June 15, 2015), 

available at https://www.acus.gov/sites/default/files/Final-Recommendation-2012-5-Improving-AgencyCoordination.pdf.

215 Id.

216 Definition of “waters of the United States” is found at 33 C.F.R. § 328.3 (Army Corps) and 40 C.F.R. § 122.2 

(EPA).The term is similarly defined in other EPA regulations, as is the term “navigable waters.” It is not defined in 

the CWA. 

217 Rapanos v. U.S., 547 U.S. 715, 722 (2006) (“In fact, the entire land are of the United States lies in some drainage 

basin, and an endless network of visible channels furrows the entire surface, containing water ephemerally wherever 

the rain falls. Any plot of land containing such a channel may potentially be regulated as a “water of the United 

States.”). 

218 Clean Water Rule: Definition of “Waters of the United States,” 80 Fed. Reg. 37054 (June 29, 2015) (to be 

codified at 40 C.F.R. pts 110, 112, 116, et.al.), available at https://www.epa.gov/sites/production/files/2015-

06/documents/epa-hq-ow-2011-0880-20862.pdf. 
51

regulates the discharge of dredged or fill material into waters of the United States, and requires a 

permit before dredged or filled materials may be discharged.219 The legislative history of the 

CWA shows that Congress intended the two agencies to share responsibility for enforcement—

and, thus, the promulgation of rules under the CWA—when they granted the Administrator of 

the EPA and the Secretary of the Army shared responsibility for the issuance of permits and 

enforcement of their terms.220 

According to Chip Smith, however, this was not how the joint rulemaking worked in the 

case of WOTUS. He testified: 

Whenever you do a joint rulemaking, the objective is and always has 

been, in my experience, until this one, for the two agencies to co-write 

and develop the rule, discuss and evaluate and resolve any issues, and 

go forward to OIRA linked at the hip and prepared to answer any 

challenges from other agencies together. That did not happen in this 

case.221 

Jennifer Moyer also acknowledged the WOTUS anomaly. She stated:

A I don't know why we weren't treated equally, but I would suggest 

that we weren't treated equally. I would suggest that it would be fair 

to say we were treated as other stakeholders were treated. 

Q Is that your experience with other joint rulemakings with the EPA? 

A No. It hasn't been. I would suggest in the development of the joint 

Army EPA 2008 mitigation rule, that that was not an effort that 

played out the way this one did. That was definitely one that was 

also very dynamic, but it was definitely Corps, EPA, Army all 

together working out their issues, reaching compromise positions 

and moving forward together. 

Q You would say that that was for of a collaborative effort? 

A Correct.222

 

219 Clean Water Act, 33 U.S.C. § 1344. 

220 Senate Comm. on Public Works, 93rd Cong., 1st Sess., A Legislative History of the Water Pollution Control Act 

Amendments of 1972 (1973), at 1509. 

221 Smith Tr. at 179 (Jan. 21, 2016).

222 Id. 
52

The EPA Did Not Include the Corps in Important WOTUS Decision-Making

This Congressionally mandated shared responsibility did not occur during the WOTUS 

rulemaking. The EPA marginalized the Corps throughout the formulation of the rule. Jennifer 

Moyer testified the Corps was unaware of when the EPA undertook drafting the final rule. She 

stated:

Q Okay. Do you know when the EPA or Army began drafting the final rule?

A No. I don’t.223

Chip Smith testified that such a situation in a joint rulemaking is unheard of. He stated:

Q We understand that the Army Corps also was unaware of when the EPA began 

drafting the final rule. Is it common in your experience that the Corps would not 

be aware of when its own joint rule is being drafted?

A No. It is unheard of.224

The EPA also drafted the entire 299-page preamble to the final rule without the Corps’

input.225 It is therefore unsurprising that Jennifer Moyer struggled to answer questions 

concerning the preamble. She testified:

Q Okay. Did you ever discuss jurisdictional determinations with 

respect to the language that was in the preamble of the rule? 

A We discussed case specific JDs with our EPA colleagues in the 

course of developing the Economic Analysis. Specific to the 

preamble language, we didn’t write the preamble at the Corps—

So I, that’s why I’m having a hard time answering your 

question.226

The EPA also did not include the Corps in the drafting of the Economic Analysis or the 

Technical Support Document,227 both of which were essential to understanding the rule.228 

 

223 Moyer Tr. at 28 (Dec. 17, 2015).

224 Smith Tr. at 36 (Jan. 21, 2016).

225 Moyer Tr. at 40 (Dec. 17, 2015).

226 Id.

227 Technical Support Document for the Clean Water Rule: Definition of Waters of the United States, U.S. 

Environmental Protection Agency and U.S. Department of the Army, May 27, 2015, available at

https://www.epa.gov/sites/production/files/2015-

05/documents/technical_support_document_for_the_clean_water_rule_1.pdf. According to page 2, “This Technical 

Support Document addresses in more detail the legal basis and the existing scientific literature in support of the 

significant nexus determinations underpinning the Clean Water Rule.” 

228 Memorandum from Maj. Gen. John W. Peabody to Asst. Sec. of the Army for Civ. Works Jo-Ellen Darcy, 

Economic Analysis and Technical Support Documents Concerning the Draft Final Rule on Definition of “Waters of 

the United States” (May 15, 2015).
53

Moyer testified that the Corps was only initially involved in drafting the Economic Analysis, 

before conversations with EPA suddenly, and without explanation, stopped. Regarding working 

on the Economic Analysis, she testified:

We were working collaboratively with EPA on methods to update the 

Economic Analysis. We were having conversations on how to best gather 

data and analyze it to determine how—the difference in jurisdiction of 

existing practices and—existing then practices and then under the new rule. 

We had conversations about what data EPA might need to assess costs and 

benefits. We provided some of that data to them, and then those 

conversations stopped occurring at a productive level. And when we saw 

the revised draft [Economic Analysis] after OMB vetting was going on, and 

that revised draft was provided to us, it wasn’t reflective of the data that we 

had provided, and we had the collaboration on the information used on—to 

determine the change in jurisdiction wasn’t—they had not used the data that 

we had developed, and they had used their own data. So that’s the answer 

for the Economic Analysis.

229

When asked to elaborate on the collaborative breakdown in drafting the Economic 

Analysis, Moyer explained that the EPA wanted to extrapolate cost data230for specific mitigation 

types and apply it to all mitigations types, which “was making us uncomfortable.”

231

 She 

testified:

A We—and this was at a staff level. I wasn’t in these meetings, but 

they were conversations surrounding the data that we were 

providing on mitigation. So cost data for mitigation. So the 

specifics of that cost data, we were providing it when the 

discussions would occur. It would be the—and this was between 

the Corps and EPA. The EPA staff would say: We’re going to 

extrapolate that data that’s specific to these mitigation types and 

say that it can be used for all of these mitigation types because 

we have specific data. There was a need to extrapolate it, and 

that was making us uncomfortable. And so the productivity 

of those conversations was decreasing because we’re very—

we, as the Corps and especially in our regulatory program, 

want our data represented for exactly what it is. And I 

understand that there was a desire to be very inclusive and use 

that data to represent a lot of different things. And so that was 

the productivity of the conversation declining that I was referring 

to.

 

229 Moyer Tr. at 87-88 (Dec. 17, 2015).

230 A portion of costs to [Section 404 permit] applicants may result from compensatory mitigation of wetlands and 

streams. There is an assumption that costs will arise in the form of compensatory mitigation. U.S. ENVIRONMENTAL 

PROTECTION AGENCY AND U.S. ARMY CORPS OF ENGINEERS, ECONOMIC ANALYSIS OF THE EPA-ARMY CLEAN 

WATER RULE (May 2015), https://www.epa.gov/sites/production/files/2015-

05/documents/final_clean_water_rule_economic_analysis_5-15_2.pdf.

231 Moyer Tr. at 88 (Dec. 17, 2015).
54

Q Okay. So did those meetings, after they reached this point where 

the productivity was declining, did they continue? 

A Not to my awareness they did not. It was—and I would 

characterize it as there was a decision that on and I would suggest 

that this was made on EPA’s part, that we have the data that we 

need. We’re going to use this to do the analysis that we need to 

do, and we’ll come back to get additional data when we need it. 

And our folks were standing ready—I was standing ready—to 

provide additional data where it was necessary. 

Q Sure. Did [EPA] ever come back to you for additional data? 

A Not that I’m aware of.232

Chip Smith shared Moyer’s concern. He testified:

Q In a letter to the Senate Committee on Environment and Public 

Works, Assistant Secretary Darcy admitted that the WOTUS rule 

was not based on case-specific jurisdictional determinations of 

the Corps, even though the preamble to the rule makes that 

claim. Can you explain why different JDs were used in the 

Economic Analysis from those used in the preamble? 

A I can’t explain it because we didn’t write it. All I can say is, we 

gave EPA 260—some cases that we had looked at—or the Corps 

had looked at—out of 70,000 we do every year. And based on 

that small set of data, EPA finalized a rule and did its Economic 

Analysis.

233

 

In fact, the Corps was not even provided drafts of the Economic Analysis or Technical 

Support Document until after the final rule was submitted to OIRA for final review. Moyer told

the Committee that despite repeated questions about the drafting status and content of the 

Technical Support Document, and requests to see it during the development of the preamble, the 

Corps was ignored and excluded. With regard to the Economic Analysis and Technical Support 

Document, she stated:

Q Did you express the concerns about not being a part of the 

development of these documents to Mr. Schmauder at any point? 

A Throughout the development of the preamble, when we would 

receive drafts of the preamble and the preamble referred to the 

Technical Support Document, we would ask in our interagency 

 

232 Moyer Tr. at 88-89 (Dec. 17, 2015). (emphasis added)

233 Smith Tr. at 90 (Jan. 21, 2016).
55

discussions: What is the Technical Support Document? Are we 

going to see a draft of it? So he was aware of that. We asked him 

that. We asked our EPA—I asked my EPA counterparts that.

Q So maybe let’s go back. When did you know of the existence of the 

Technical Support Document? 

A We knew that it was being developed. We weren’t quite sure what 

it was. But we knew it was being developed when we saw the first 

version of the preamble that was shared with us. And I’m going to 

say that was in the March [2015] timeframe. I’m not specifically 

sure of when in that timeframe that was.234

The lack of collaboration forced the Corps to weigh in on the substance of these two documents, 

stating “both documents are flawed in multiple respects.”

235

EPA Excluded the Corps from Considering Basic Components of the Rule

The EPA’s exclusionary tactics extended past the Economic Analysis and Technical 

Support Document. EPA failed to consult with the Corps on the decision to significantly 

increase jurisdiction under the Clean Water Act by 72 percent between the proposed rule and 

final rule.236 In fact, Moyer could not even explain to the Committee how EPA reached this 

decision. She testified:

Q What accounted for this 72 percent increase in jurisdiction 

between the proposed rule and the draft final rule? 

A It’s—and that’s difficult for me to say because we are unaware 

of what version of the final rule they used when they determined 

that increase in jurisdiction.

Q And by “they,” you mean EPA? 

A Right.237

Furthermore, the EPA ignored many of the Corps’ recommendations and comments. 

Moyer testified the Corps submitted multiple recommendations on comments to the rule that 

were disregarded. She testified:

 

234 Moyer Tr. at 85-86 (Dec. 17, 2015).

235 Memorandum from Maj. Gen. John W. Peabody to Asst. Sec. of the Army for Civ. Works Jo-Ellen Darcy, 

Economic Analysis and Technical Support Documents Concerning the Draft Final Rule on Definition of “Waters of 

the United States” (May 15, 2015).

236 Moyer Tr. at 94 (Dec. 17, 2015). See also Id., at 3 “The [economic analysis] estimates CWA jurisdiction to 

increase from its estimate of 2.7 percent in the proposed rule to 4.65 percent in this analysis of the draft final rule” 

representing a 72 percent difference in increased jurisdiction.

237 Moyer Tr. at 94 (Dec. 17, 2015).
56

Q So the recommendations then, that we’re speaking of, were those 

recommendations incorporated into the final rule? 

A Not all of them, no. 

Q Which recommendations were not incorporated?

A So there were several of them. I know you have the memos. 

There were several recommendations that were made that were 

not incorporated.238

 Smith also testified the Corps was largely left out of the outreach efforts.

239

 In fact, the

Corps also only participated in “72 or 73” out of 400240 outreach meetings with the states and 

other outside interests, due, in part, to the fact that it was not aware of all the meetings.241 

The EPA continued to take a lead (or, in many cases, solo) role in public management of 

the rule, all the way through its roll-out. On May 12, 2015, an OMB employee sent an email 

summary of the “interagency Clean Water Rule roll-out meeting” with the EPA that occurred 

that morning.242 The summary described the Corps as merely “a bit player in this process,” and 

observed that “[a]lthough all roll-out seems to be joint between EPA and the [Army] Corps, the 

meeting was very EPA-centric.”

243

 

238 Id. at 29.

239 Smith Tr. at 91 (Jan. 21, 2016).

240 Moyer Tr. at 20, 134-135 (Dec. 17, 2015).

241 Moyer Tr. at 20 (Dec. 17, 2015).

242 Email from Tera Fong, OMB, to Vlad Dorjets, OIRA, et al., (May 12, 2015, 02:58 p.m.) (OMB-39663).

243 Id.
57

The Corps was not the only agency left out of the EPA’s outreach and efforts to finalize 

the rule. In a late-April 2015 email, Jim Laity expressed frustration to colleagues that EPA was 

scheduling “side meetings w[ith] agencies” without including OIRA, since such meetings were 

specifically OIRA’s “job.”

244

 

244 Email from Jim Laity, OIRA, to Vlad Dorjets, OIRA (Apr 26, 2015, 10:19 a.m.) (OMB-035216).
58

The EPA Stopped Collaborating with the Corps Altogether

In September 2014, a “team of eight” comprised of Army, Army Corps, and EPA 

personnel started meeting weekly to work through issues with the rule.

245 Moyer, who was a 

member of the group, summarized its purpose when she testified to the Committee. She stated:

Q So just stepping back a bit, the purpose of assigning the team of 

eight was for what, exactly? 

A It was my understanding — and this was communicated to us by 

Mr. Schmauder and Mr. Peck—was that this team of eight was 

going to discuss technical issues and concerns and considerations 

that then would be raised to the policymakers. And we would 

try to come to a series of options and recommendations that 

would be the minimal number that would, then, be considered by 

the policymakers themselves for decision into the draft final rule. 

So we would resolve as much of the technical issues as we 

possibly could in this team of eight.246

These meetings about the draft final rule primarily occurred via conference call.

247

Moyer testified the meetings were generally productive, with the group engaging in “very robust 

conversations” about the rule.248 The group developed and then discussed various “option 

 

245 Moyer Tr. at 56 (Dec. 17, 2015).

246 Id. at 57.

247 Id. at 60.

248 Id. at 57.
59

papers,” and “were having necessary and robust disagreements at that inter-agency table as you 

would in the development of a final rule.”

249

Despite such dynamic and productive joint-agency interaction, the EPA suddenly, and 

without explanation, stopped the meetings at the beginning of November 2014. Moyer testified:

A We stopped meeting after the 6th of November. There were no 

meetings, then, until about the middle of January. 

Q Okay. What’s the reason for that? 

A I don’t know. 

Q Okay.

A I don’t know. The meetings just would be canceled every week. 

Q I see. Middle of January. And then you picked up the meetings 

again? 

A There would be phone calls. They were face to face before, and 

then there were sporadic phone calls. And in that timeframe, I 

would say towards the end of January, early February is when 

Mr. Schmauder shared with us a draft of the draft final rule.

250

Smith, who was also a part of the “team of eight,” recalled that the group was created in 

order for the EPA to speed up release of the rule.251 Smith testified that the team did not meet 

nearly as much as intended before it disbanded:

In either October or November of 2014, there was an urgent desire to 

move the rule forward. Obviously we’re on a time schedule having to 

do with the administration and the time left and just getting it done, we’d 

been working on it for so long, so that we created this team of eight. 

I was one of the people on the team of eight. And the goal was to get 

together on a weekly or on an even more regular basis and talk about 

rule issues, try to resolve them so that the rule text could be adjusted by 

EPA, and then any issues that were unresolved, we would quickly 

elevate to our appointees for a solution so we could keep things moving, 

but as it turned out, we only met, I believe, in person twice and we had 

maybe two phone calls, and all the other weeks typically EPA would not 

meet with us. For whatever reason, they were busy or whatever. 252 

 

249 Id. at 57-58.

250 Id. at 56-57.

251 Smith Tr. at 22-23 (Jan. 21, 2016).

252 Id.
60

Despite option papers authored by the Corps proposing necessary improvements to 

WOTUS, and the Corps’ comments regarding the rule, the Corps’ key recommendations were 

not incorporated into the final rule. Moyer stated she was “surprised” when the draft final rule 

text was presented to the team after they resumed meeting in mid-January 2015,

253 since the team 

was still in the process of working out issues when it stopped meeting in late 2014. Moyer 

testified:

Q So based on the information that you put in your option papers 

and some of the language that you ultimately saw in the draft 

proposed final rule, would you say that any of the options that 

you proposed made its way into any of those drafts? 

A I would say that the draft rule text certainly reflected discussion 

points that had come up among the agencies. I wouldn’t say that 

the points that the Corps was extraordinarily concerned about 

were reflected in that draft text. But it wasn’t a surprise what we 

saw, but I think that it’s fair to say that we were surprised that 

there was draft rule text when we hadn’t completed the 

conversation, and that we weren’t part of drafting the rule 

text. 

Q So who did you understand to draft the rule text? Who was 

responsible for that? 

A I believe EPA drafted the rule text. That’s my—that’s what I 

believe occurred.254

Smith testified that the Corps was not included in drafting the final rule. He stated:

Q The draft final rule was shared with the team by EPA shortly 

after the meetings commenced in January. Do you know who 

drafted this draft final rule? 

A Well, it was EPA. I can’t say who personally drafted it. It was 

not myself and it was not the Corps. 

Q Were you consulted at all during the drafting of the draft final 

rule while these meetings were not taking place? 

A It is true we were consulted, but the consultation was minimal 

and it was usually—text was provided us and we would be given 

a couple hours, maybe a day or two, to look at it and then react.255

 

253 Moyer Tr. at 59 (Dec. 17, 2015).

254 Id. (emphasis added)

255 Smith Tr. at 23-24 (Jan. 21, 2016).
61

He went on to comment about the unusual nature of this proceeding, testifying:

Q We understand that the Army Corps also was unaware of when the EPA began 

drafting the final rule. Is it common in your experience that the Corps would not 

be aware of when its own joint rule is being drafted? 

A No. It is unheard of.256

 Moyer testified the EPA never explained why it chose to leave the Corps’ comments out 

of the rule.257 Once the Corps did eventually see the final rule, it realized that “several” of its 

key recommendations on the rule text were omitted. Moyer testified:

Q So the recommendations then, that we’re speaking of, were those 

recommendations incorporated into the final rule? 

A Not all of them, no. 

Q Which recommendations were not incorporated? 

A So there were several of them. I know you have the [Peabody] 

memos. There were several recommendations that were made 

that were not incorporated.258 

When the Corps attempted to raise important unaddressed technical issues with the draft 

rule language, the EPA grew irritated and attempted to push forward without resolving the 

matters.259 Moyer testified:

A I think that oftentimes there was—that Mr. Schmauder wanted to 

understand and he would request from me to explain what my 

technical concern was, and he would ask EPA to explain their 

technical concern, and then the discussion would move on. 

Q Okay.

A And when there was a desire in the next call to discuss it again, this 

is my perception—there was irritation expressed by my colleagues 

at EPA that it was even coming back again. It’s like, we discussed 

this; we’re moving on. 

And I believe that resolution wasn’t reached on some of those 

things, and it wasn’t communicated to me clearly on those calls that 

a policy decision had been made, that that particular issue was off 

 

256 Id. at 36.

257 Moyer Tr. at 29 (Dec. 17, 2015).

258 Id.

259 Id. at 60-61.
62

the table. And this is myriad issues, that’s why I’m not identifying 

a specific issue.

 

So, and I will say, when a policy decision is made, a policy decision 

is made, and we move on. I don’t have a problem with that. But 

this is kind of how I would characterize those conversations. They 

were clearly still on the table, because no one had communicated, 

Ms. Darcy and Ms. McCarthy had made a decision. 

Q Right. So at this point you are sort of speculating that there was a 

policy decision made because they were irritated having to revisit it 

in the conversation? 

A Right, or a policy decision hadn’t been made, but there was still 

irritation that we were still bringing up issues that 

 

Q Right.

A —that was no longer a desire to talk about.260 

Corps Leadership Had Concerns About the EPA’s Approach

The EPA’s decision to name the Corps as a co-author to the rule is misleading and 

against direct statements by the Corps.261 Despite the EPA’s assertion that the rulemaking was 

prepared jointly, the Corps disagrees. In their view, it was “not a joint venture.”

262

 Major 

General Peabody, Deputy Commanding General for Civil and Emergency Operations with the 

Corps, highlighted the Corps concerns over the EPA’s takeover of the rulemaking in memoranda 

sent to the Assistant Secretary of the Army for Civil Works, Jo-Ellen Darcy (hereinafter, the 

“Peabody Memoranda”).263 The Peabody Memoranda set forth many legal, scientific, and 

procedural concerns regarding the rule, but also the general lack of consideration of Corps 

concerns. 

Indeed, Major General Peabody specifically stated that “[t]he preamble to the proposed 

rule and the draft preamble to the draft rule state that the rulemaking has been a joint effort of the 

EPA and the Corps, and that both agencies have jointly made significant findings, reached 

 

260 Id. at 61-62. (emphasis added)

261 Memorandum from Maj. Gen. John W. Peabody to Asst. Sec. of the Army for Civ. Works Jo-Ellen Darcy, 

Economic Analysis and Technical Support Documents Concerning the Draft Final Rule on Definition of “Waters of 

the United States” (May 15, 2015); Memorandum from Maj. Gen. John W. Peabody to Asst. Sec. of the Army for 

Civ. Works Jo-Ellen Darcy, Draft Final Rule on Definition of “Waters of the United States” (Apr. 27, 2015).

262 Memorandum from Maj. Gen. John W. Peabody to Asst. Sec. of the Army for Civ. Works Jo-Ellen Darcy, 

Economic Analysis and Technical Support Documents Concerning the Draft Final Rule on Definition of “Waters of 

the United States” (May 15, 2015).

263 Memorandum from Maj. Gen. John W. Peabody to Asst. Sec. of the Army for Civ. Works Jo-Ellen Darcy, 

Economic Analysis and Technical Support Documents Concerning the Draft Final Rule on Definition of “Waters of 

the United States” (May 15, 2015); Memorandum from Maj. Gen. John W. Peabody to Asst. Sec. of the Army for 

Civ. Works Jo-Ellen Darcy, Draft Final Rule on Definition of “Waters of the United States” (Apr. 27, 2015).
63

important conclusions, and stand behind the final rule. These statements are not accurate...”

264

 

Major General Peabody requested that the rule “not identify the Corps as Author, coauthor, or substantive contributor,” and “the Corps of Engineers logo should be removed from

those documents.”

265

 

264 Memorandum from Maj. Gen. John W. Peabody to Asst. Sec. of the Army for Civ. Works Jo-Ellen Darcy, Draft 

Final Rule on Definition of “Waters of the United States” (Apr. 27, 2015). 

265 Id.
64

OIRA, which reviews draft regulations and rules from federal agencies, also recognized 

that the EPA had effectively taken over the rulemaking process, but noted that they took 

significant steps to ensure that the EPA’s effort to expel the Corps from the rulemaking process 

be kept hidden. Documents show Jim Laity stated on multiple occasions that the EPA had 

effectively taken the lead on the purported “joint” rulemaking.266

 

266 See, e.g., email from Jim Laity, OIRA, to Jasmeet Seehra, OIRA, et al (Feb. 24, 2015, 12:06 p.m.) (OMB036975); email from Jim Laity, OIRA, to Jasmeet Seehra, OIRA, et al (Feb. 19, 2015, 2:27 p.m.) (OMB-036976).
65

A. THE PEABODY MEMORANDA WERE “UNPRECEDENTED”

According to the Assistant Secretary of the Army for Civil Works Jo-Ellen Darcy, it is 

unprecedented for senior agency officials to present such opposition to their own rule, 

particularly given that the final WOTUS Rule was promulgated a mere month after the release of 

the Peabody Memoranda.267 Assistant Secretary Darcy testified the memoranda caught her by 

surprise, despite her direct involvement in the multiyear process creating the rule. She stated:

Q And you mentioned earlier that you had met, if not frequently with 

the Corps, at least enough that it was more than four times. Why 

would you say that you were surprised in seeing these memos at this 

stage?

A Well, they—these are internal, deliberative memos to the Corps and 

the Army. And I guess I was surprised that they had—had handed 

it to me in writing. That that surprised me. ‘Cause that—I—I 

don’t think in the entire seven years—six-and-a-half years that I’ve 

been in this position has a deputy commanding general handed me 

a memo that I didn’t know about.

Q And when you say you didn’t know about the memo, are you saying 

about its contents or about the fact that they were developing the 

memo?

A That they were developing the memo.

Q So you’re saying essentially you had no notice that these memos 

were coming to you?

A Correct. It was handed to me on a Monday afternoon.268

Despite the significance of the concerns raised in the Peabody Memoranda, however, 

Darcy failed to raise these concerns with anyone at the EPA. She stated:

Q Did you discuss the memos or their contents with the EPA after 

receiving these memos?

A No.269

Darcy testified she was just “hoping that the Corps could support the—the President’s rule.” She 

stated:

 

267 The Clean Water Rule was published on June 29, 2015 in the Federal Register. 80 Fed. Reg. 37,054. The 

Peabody Memoranda were published between Apr. 27, 2015 and May 15, 2015. 

268 H. Comm. on Oversight & Gov’t Reform, Transcribed Interview of Jo-Ellen Darcy, Tr. at 110-11 (Mar. 29, 

2016). (emphasis added)

269 Id. at 111. (emphasis added)
66

Q And what was the general’s conversation? What was the nature of 

that conversation?

A Well, as I have a monthly meeting with General Bostick, and this 

was the subject of one of our—one of the subjects of our monthly 

meeting. And I just said that I was very surprised by it and, you 

know, was hoping that the Corps could support the—the President’s 

rule.270

B. THE PEABODY MEMORANDA SHOW THE EPA IGNORED THE ARMY CORPS’

CONCERNS ABOUT DEVELOPING THE WOTUS RULE BASED ON FAULTY SCIENCE 

In the Peabody Memoranda, Major General Peabody wrote:

[The Corps’] technical review of both documents indicate that the Corps’

data provided to EPA has been selectively applied out of context, and mixes 

terminology and disparate datasets. In the Corps’ judgment, the documents 

contain numerous inappropriate assumptions, with no connection to the data 

provided, misapplied data, analytical deficiencies, and logistical 

inconsistencies.271

 

270 Id. at 110. (emphasis added)

271 Memorandum from Maj. Gen. John W. Peabody to Asst. Sec. of the Army for Civ. Works Jo-Ellen Darcy, 

Economic Analysis and Technical Support Documents Concerning the Draft Final Rule on Definition of “Waters of 

the United States” (May 15, 2015). (emphasis added)
67

To support his memorandum, Peabody attached a review of the rulemaking’s Economic 

Analysis and the Technical Support Document (TSD) written by the Corps’ economist, Paul 

Scodari. The review provided that “[t]he Corps had no role in selecting or analyzing the data 

that the EPA used in drafting either document.” 
68

Peabody again disavowed the work, stating: “[a]s a result, the documents can only be 

characterized as having been developed by the EPA and should not identify the Corps as an 

author, co-author or substantive contributor.”

272

 To imply or portray otherwise “is simply 

untrue,” Peabody wrote.

273

 

 

272 Id. (emphasis added)

273 Id. (emphasis added)
69

According to the Peabody memoranda, Moyer stated the EPA’s use of the Corps’ raw 

data was a “[g]ross misrepresentation of Corps raw data.”

274

These concerns were not new. Scodari noted in his May 2015 review of the rule’s

Economic Analysis that the Corps requested the EPA “characterize the entire report as an EPA 

analysis.”

275

 Despite the Corps’ objection to receiving attribution for analysis underlying the 

 

274 Id. (emphasis added)

275 Memorandum from Paul Scodari, Army Corps, Review Comments on Economic Analysis of the EPA-Army Clean 

Water Rule (May 11, 2015) at 2. 
70

WOTUS rule, Scodari found the “EPA seems to go out of its way to link report responsibility to 

[the Corps].”

276

Documents show the concerns expressed by Scodari and Peabody echoed those of the 

Corps’ Regulatory Branch Chief, Margaret Gaffney-Smith, with regard to the regulation of 

tributaries and the science used to support the EPA’s findings.277 In an email, she wrote:

[The Corps] remain extremely concerned with the manner in which the 

Ditch Exclusions and the language in the Tributary Section and science to 

support regulation of tributaries by rule is reflected and we believe more 

work should be done to address sections where language in this proposed 

rule is inconsistent and/or contradictory.278 

 

276 Id. (emphasis added)

277 Email from Margaret Gaffney-Smith, Army Corps, to Craig Schmauder, Army Corps, and Marie Dominguez, 

Army Corps (Feb.21, 2014, 3:42 P.M. EST) (OMB-046639-40).

278 Id.
71

Expressing these concerns, however, proved difficult, as “[u]nfortunately, [the Corps] 

have not been part of discussions with OMB or the EPA on this topic,” according to GaffneySmith.279

Smith testified that the Army penalized staff for asking “questions of science and 

economics.”

280

 He testified:

Q You informed the committee that after Ms. Darcy took this action 

your salary level and grade level did not change. Did you experience 

any other type of change after Ms. Darcy took the action? 

A Performance rating.

Q And—

 

279 Id.

280 Smith Tr. at 21 (Feb. 19, 2016). (emphasis added)
72

A I’ve been in the Assistant Secretary’s office since 1996, so I’ve been 

rated however many times that would be. Nineteen? Nineteen 

times. Somebody can do the math. And all of my ratings but two 

have been the highest possible. We have a scale of 1 to 5, 5 being 

exceptional. And all but two were exceptional. And the two that 

were not exceptional, down to a 4, pertained to this rule. 

One was 3 years ago when EPA—Nancy Stoner and Greg Peck 

complained to Principal Deputy Rock Salt that the Corps and myself 

were too difficult to work with because we asked questions of 

science and economics. And so I got dinged for not being as 

collegial as I could be with EPA. And then this last rating period, 

Ms. Darcy dropped me down one, and I asked Let Mon, why did 

this happen? And the response was, because of the EIS 

recommendation. 281

C. TOP ARMY OFFICIALS ISSUED A “GAG ORDER” TO BURY DISAGREEMENT WITH 

THE EPA’S AGENDA

Top officials at the Army also sought to restrict the ability of its rulemaking experts to 

voice concerns about WOTUS and the science underlying the rule. Smith expressed frustration 

that rather than addressing concerns about the rule, Assistant Secretary Jo-Ellen Darcy and 

Deputy General Counsel Craig Schmauder instead imposed “gag” orders on commenting on the 

rule.282 Specifically, Darcy issued two memoranda mandating that personnel working on 

WOTUS direct all communications regarding the rule through her and her office. Schmauder

testified:

Q Okay. And both of those memos expressed that sentiment, that all 

communications go through Ms. Darcy? 

A Generally, yes, I would say that’s a fair characterization of those 

memos was that we—comments on the rules or comments to the 

interagency process or comments to others, that Ms. Darcy wanted 

to have a filter through or at least knowledge of all the 

communications affecting this key administration rulemaking effort. 

And I think she put out guidance to that effect.283 

Darcy’s first memorandum, issued October 3, 2013 to the Chief of Engineers, specifically 

demanded that “all communications with EPA and OMB during the interagency review . . . shall 

be reviewed by me or the Principal Deputy.”

284

 

281 Smith Tr. at 21 (Feb. 19, 2016). (emphasis added)

282 Smith Tr. at 58-60 (Jan. 21, 2016).

283 Schmauder Tr. at 34 (Feb. 17, 2016). 

284 Memorandum from Jo Ellen Darcy, Assistant Sec. Civil Works, U.S. Army, to U.S. Army Corps Chief of 

Engineers (Oct. 3, 2013).
73

In the second memorandum, sent via email on April 3, 2015, Assistant Secretary Darcy 

reiterated that the Agency must “speak with one voice regarding the rule” by channeling all 

outside communications through her office.285

Smith testified that these memoranda suppressed any constructive comments and 

concerns that conflicted with the EPA’s agenda for the rule. He stated:

Q How did you come to the understanding that you were supposed to 

be quiet? 

 

285 Email from Jo Ellen Darcy, U.S. Army, to Thomas Bostick, U.S. Army, et.al. (May 15, 2015; 05:13 p.m.).
74

A Because our comments typically were not considered, and when we 

would ask about it, we were told decisions have been made. Stop 

asking. And that was Mr. Schmauder.286

He also stated that the “gag orders” imposed on staff were uncommon for a rulemaking. 

Having served as the principal advisor to the Assistant Secretary of the Army for Civil Works on 

regulatory activities for almost 20 years, Smith had never seen this type of communication 

directive in the course of a rulemaking. Smith also testified that the directive’s prime purpose 

was not for constructive reasons, but to rush completion of the rule. Smith stated:

Q You previously told us that Ms. Darcy’s memos were interpreted as 

gag orders by the Corps. In your experience, are these types of 

communications directives typically issued in the course of a Corps 

rulemaking? 

A No. 

Q Have you ever seen this type of communications directive before? 

A Not to me or the Corps on my tenure. 

Q Do you know the purpose of their issuance in this rulemaking? 

A To inform us that we should not comment on environmental, 

economic, tribal consultation, or any other issues that might affect 

the schedule or the ultimate policy goals EPA had for the rule.287

D. THE CORPS’ RULEMAKING EXPERTS WERE CUT OFF FROM THE DECISION MAKERS

The Corps’ rulemaking experts received very limited access to Assistant Secretary Darcy 

for WOTUS briefings. Although Jennifer Moyer served as head of the Army Corps’ rulemaking 

program, she testified that she briefed Darcy on the rulemaking only four times over the multiyear WOTUS process.288

 According to Chip Smith, such an infrequent briefing schedule is 

highly unusual—especially given the enormity and complexity of the rulemaking. He testified:

Q The committee understands that the chief of the Army Corps 

regulatory program only communicated with Ms. Darcy on four 

separate occasions regarding the rule during the entirety of the 

Waters of the United States rulemaking.289 In your experience, is it 

common for the head of the regulatory program to provide such 

infrequent input—

 

286 Smith Tr. at 58-60 (Jan. 21, 2016).

287 Id. at 80 (Feb. 19, 2016).

288 Moyer Tr. at 14 (Dec. 17, 2015).

289 This refers to testimony from Assistant Secretary Darcy, who told the Committee that she met with the Army 

Corps more than four times, but could not recall the details of the meetings. (Darcy Tr. at 25-27)
75

 

A No. 

Q —in rulemaking of this magnitude? 

A No.290 

Chip Smith testified that Schmauder played a prominent role in the WOTUS process and Darcy 

relied exclusively on Smith for advice. 291 Smith stated:

Q But there were others at the Department of Army who advised 

Secretary Darcy on—that provided advice. There were other staff 

members as well?

A Only the attorney. No other staff. I’m the only person who does 

regulatory on our staff. We’re a small staff. 

Q And that’s Mr. Schmauder? 

A Yeah.292

Darcy confirmed Smith’s statements. She testified:

Q Who primarily advised you throughout the rulemaking?

A I would say Mr. Schmauder.293

Moyer testified that in her experience, Army officials aside from the technical staff, like 

Schmauder, did not play a major role in drafting rules.294 Likewise, Smith testified that having 

someone from the Army General Counsel’s office so heavily involved in a rulemaking was 

unusual. Smith stated:295 

Q Are you aware of whether Mr. Schmauder made any technical or 

policy decisions in the rulemaking? 

A Absolutely. 

Q Mr. Schmauder informed this committee that he himself drafted the 

Waters of the United States guidance and rule along with Mr. Peck 

of the EPA. In your time with the Corps, is it common for an 

attorney with the Office of General Counsel to draft a major 

 

290 Smith Tr. at 21-22 (Jan. 21, 2016).

291 Id. at 20.

292 Id. at 71.

293 Darcy Tr. at 21 (Mar. 29, 2016).

294 Moyer Tr. At 16-17 (Dec. 17, 2015).

295 Smith Tr. at 20-21 (Jan. 21, 2016).
76

rulemaking such as this? 

A No. It has never been done before. 

Q Is it common for an attorney with no background in the rulemaking 

or the underlying subject matter to draft rules—

A No. 

Q —for the Army Corps? Are you aware of why Mr. Schmauder had 

such a prominent role in this rulemaking? 

A No. 

Schmauder lacked rulemaking experience, and had little knowledge of substantive parts 

of the rule and rulemaking process. Still, he played a major role on the WOTUS team. 

Schmauder testified:

Q Okay. In the December 15th, 2015, briefing with this committee, 

you informed us that you took part in drafting the WOTUS rule. 

How many rules had you drafted before WOTUS? 

A Well, again, if you’re including the guidance document as rule, I 

worked on the 2008 guidance document, the early version of the 

joint Army EPA WOTUS guidance document that, again, it went 

into the Federal Register for public comment, and then it was never 

finalized because then we developed the proposed rule and the final 

rule. 

Q But any other rules besides WOTUS?

A I was involved with the 2008 mitigation rule but not to the extent 

that I was involved in the WOTUS rule. 

Q You didn’t draft the 2008? 

A I did not. I did not. 

Q Of the Army staff involved in the rulemaking, who would you say 

had the most regulatory expertise? 

A Say that again. 

Q Of the Army staff—

 
77

A Chip Smith . . . .

296

E. OIRA DID NOT TREAT THE CORPS AS AN EQUAL PARTNER WITH THE EPA IN THE 

WOTUS RULEMAKING

The WOTUS rule is presented as a joint rulemaking between the EPA and the Army 

Corps, but the Corps was excluded as the rule moved through the OIRA review process.297 

During the review, OIRA coordinated with Greg Peck, Chief of Staff of the Office of Water and

point person for EPA on WOTUS, and Craig Schmauder at the Army.298 With respect to 

communications between the Corps and OIRA, OIRA’s Jim Laity testified:

I had been informed that the leadership of the Army . . . had designated 

Craig Schmauder as the primary contact person for my interaction with the 

agency and my review. Generally, we feel it’s appropriate to respect the 

agency’s internal processes and to deal with whomever the agency 

designates as the appropriate person to deal with OMB. So I did not have a 

lot of interaction with other Corps staff because it had been set up that Craig 

would be my point of contact.299

Documents show the Corps sought to engage with OIRA during the review, but OIRA 

did not review their comments. A February 2014 email shows that Laity relied on Schmauder to 

address the Corps’ comments about the rule.

300

With respect to this arrangement, whereby Schmauder was the point of contact for the 

Corps, Laity stated: “I assumed from the beginning that Craig [Schmauder] was fully in the loop 

 

296 Schmauder Tr. at 14-15 (Feb. 17, 2016).

297 Gina McCarthy, Administrator, U.S. Environmental Protection Agency, and Jo-Ellen Darcy, Assistant Secretary 

for Civil Works, U.S. Army, Reasons We Need the Clean Water Rule (May 27, 2015, 10:08 a.m.), available at

https://blog.epa.gov/blog/2015/05/reasons-we-need-the-clean-water-rule/.

298 Laity Tr. at 28 (Mar. 8, 2016).

299 Id. at 136.

300 Email from Jim Laity, OIRA to Craig Schmauder, Army, and Greg Peck, EPA (Feb. 26, 2014 07:59 p.m.) 

(OMB-000877).
78

in the decision-making process within the Army and the Corps, and that any interaction between 

the Corps and OIRA, it was appropriate to have Craig be the primary point of contact.”

301

Even with Schmauder representing the Corps, the EPA assumed a leadership role in 

negotiations with OIRA. The documents show Schmauder was excluded. Emails show Peck 

sought to negotiate language in the proposed rule directly with OIRA, without involving 

Schmauder.302 

When asked about those communications, Laity said “when I got emails like this, I did 

deal more directly with Greg [Peck]. He and I had been working on this issue together for many 

years, going back into the Bush administration, but I assumed that he was speaking on behalf of 

both agencies.”

303

 

F. THE “CIVILETTI MEMORANDUM” DOES NOT CONTROL THIS JOINT RULEMAKING

The Civiletti Memorandum, issued in 1979, was promulgated in response to the question 

“whether the [CWA] gives the ultimate authority to determine the reach of the term ‘navigable 

waters’ for purposes of § 404 to [the Secretary of the Army], acting through the Chief of 

 

301 Laity Tr. at 151 (Mar. 8, 2016).

302 Email from Jim Laity, OIRA to Greg Peck, EPA (Feb. 10, 2014 07:59 p.m.) (OMB-000856).

303 Laity Tr. at 150 (Mar. 8, 2016).
79

Engineers, or to the Administrator of the Environmental Protection Agency.”

304

 Then-Attorney 

General Benjamin Civiletti concluded: “Congress intended to confer upon the administrator of 

the Environmental Protection Agency the final administrative authority.”

305

However, in so concluding, Civiletti wrote that “no specific provision of the Federal 

Water Pollution Control Act or specific statement in its legislative history speaks directly to this 

question,” and “the question is explicitly resolved neither in § 404 itself nor its legislative 

history.”

306

 

The Civiletti Memorandum does not control the joint rulemaking process at issue in this 

report. Even if considered controlling, it would only extend to § 404, and not the entirety of the 

CWA. Additionally, the Memorandum only relates to administering the rule, and makes no 

determination as to the rulemaking process. 

Some witnesses testified that the Civiletti Memorandum vested CWA rulemaking 

authority with the EPA. This position is belied by the fact that the EPA itself characterized the 

rulemaking as “joint” and consistently argued in favor of the Corps’ inclusion in both the 

rulemaking process and administration of the CWA.307 Finally, regardless of the extent of the 

EPA’s authority with regard to § 404 of the CWA, it certainly does not extend to allow the EPA 

to apply data “out of context.”

308

 

 

304 43 Op. Att’y. Gen. 197 (1979), available at https://www.epa.gov/sites/production/files/2015-

08/documents/civiletti_memo.pdf.

305 Id.

306 Id.

307 See, e.g., Brief for Respondents at *4-5, Rapanos v. U.S., 547 U.S. 715 (2006) (No. 04-1034), 2006 WL 123765; 

Brief for Respondents at *21, Solid Waste Agency of Northern Cook County v. U.S. Army Corps of Engineers, 531 

U.S. 159 (2001) (No. 99-1178) 2000 WL 1369439 (stating “the legislative history of the 1972 Act and the 1977 

amendments supports the Corps' construction of the term “Waters Of The United States”). 

308 Memorandum from Regulatory Program Chief Jennifer Moyer to Maj. Gen. Peabody, Economic Analysis and 

Technical Support Document Concerning the Draft Final Rule on Definition of “Waters of the United States (May 

15, 2015). (emphasis added)
80

G. GAO’S MAJOR RULE REPORT DOES NOT EVALUATE AGENCY COMPLIANCE WITH 

THE LAW

On July 16, 2015, the Government Accountability Office released an opinion on the 

WOTUS rulemaking, as required by the Congressional Review Act (CRA). The CRA requires 

GAO to issue a report on each major rule undertaken by an agency.309 In its report, GAO notes 

that their “review of the procedural steps taken indicates that the agencies complied with the 

applicable requirements.”310 While GAO reviewed the rulemaking process, the report itself is 

limited to a very cursory examination of whether the agency addressed the rulemaking 

requirement or not. To avoid any confusion about the scope of its review, GAO included a 

disclaimer that stated it “does not analyze or comment on the substance or quality of 

rulemaking.”311 GAO reports on major rules merely indicate that the rulemaking agencies 

stated they conducted proper rulemaking actions—they do not evaluate the quality of the 

agencies’ compliance with applicable statutes or the underlying rule.

The GAO report is therefore not useful for evaluating whether the rulemaking was 

procedurally valid at a substantive level. Several witnesses—some without any knowledge of 

the report—testified about the GAO’s conclusions with respect to its review of the WOTUS 

 

309 GAO, DEPARTMENT OF DEFENSE, DEPARTMENT OF THE ARMY, CORPS OF ENGINEERS; ENVIRONMENTAL 

PROTECTION AGENCY: CLEAN WATER RULE: DEFINITION OF “WATERS OF THE UNITED STATES”, GAO-15-750R 1, 

(July 16, 2015), available at http://www.gao.gov/assets/680/671628.pdf. 

310 Id. at 2.

311GAO, CONGRESSIONAL REVIEW ACT FAQS, available at http://www.gao.gov/legal/congressional-review-act/faq. 
81

rule.312 The GAO report on WOTUS asserts that the agencies claimed to have complied with 

rulemaking due diligence and legal requirements, but it is clear that while the agencies may have 

checked the boxes, these steps did not sufficiently comply with the spirit or intent of the law.

 

312 E.g., Laity Tr. at 47- 51 (Mar. 8, 2016) “Again, I don’t know anything about how GAO conducted this report...”, 

Smith Tr. 107-110 (Feb. 19, 2016) “I’m not going to opine on what GAO did.”
82

THE EPA DISREGARDED SCIENCE WHILE DEVELOPING THE CLEAN WATER 

RULE

FINDING: The EPA made no effort to ensure the rule was based on sound 

science. The EPA did not conduct additional research (which the 

Corps believes was necessary) to justify the rule’s conclusions. 

OIRA enabled the agencies to proceed with the rulemaking despite 

violation of its own Information Quality standards.

The Administrative Procedure Act (APA) requires agencies, in promulgating rules,313 to 

make findings that support its decision, and “those findings must be supported by substantial 

evidence.”

314

 Though “agencies may rely on comments submitted during the notice and 

comment period as justification for the action,” they may only do so when such comments “are 

examined critically.”

315 Further, courts have long recognized that “[i]t is not consonant with the 

purpose of a rule-making proceeding to promulgate rules on the basis of inadequate data, or on 

data that, critical degree, is known only to the agency.”

316

 

Because the lynchpin concept of the proposed rule is whether or not there is a “significant 

nexus between the wetlands and ‘navigable waters’” sought to be regulated by the agencies under 

the CWA, it follows that the scientific basis for the WOTUS rule, which defines what constitutes 

a significant nexus, should have been a top priority for the EPA and Corps in its development.317 

The Scientific Basis for the Rule Was Finalized After the Rule Was Drafted 

The EPA assembled a Scientific Advisory Board (SAB) to review a draft report entitled 

the “Connectivity of Streams and Wetlands to Downstream Waters: A Review and Synthesis of 

Scientific Evidence” (Connectivity Report) in July 2013.318 This “peer reviewed scientific 

literature” used in the Connectivity Report was purportedly to “help inform EPA and U.S. Army 

Corps of Engineers in their continuing policy work” and to “clarify what waters are covered by 

 

313 5 U.S.C. §551(4); see WILLIAM S. JORDAN, III, AMERICAN BAR ASS’N , RULEMAKING (2011) (“The APA 

definition of a ‘rule’ is broad enough to encompass virtually any agency statement about what regulated parties must 

or should do in the future.”). 

314 Burlington Truck Lines, Inc. v. United States, 371 U.S. 156, 168, (1962).

315 Am. Wild Horse Pres. Campaign v. Vilsack, 133 F. Supp. 3d 200, 211 (D.D.C. 2015); see also Nat'l Ass'n of 

Regulatory Util. Comm'rs v. FCC, 737 F.2d 1095, 1124 (D.C.Cir.1984).

316 Portland Cement Ass'n v. Ruckelshaus, 486 F.2d 375, 393 (D.C. Cir. 1973).

317 Rapanos v. United States, 547 U.S. 715, 742, (2006) (holding that “Wetlands with only an intermittent, 

physically remote hydrological connection to ‘waters of the United States’ do not implicate the boundary-drawing 

problem of Riverside Bayview, and thus lack the necessary connection to covered waters that we described as a 

‘significant nexus’ in SWANNCC.”) (citing Solid Waste Agency of N. Cook Cty. v. U.S. Army Corps of Engineers,

531 U.S. 159 (2001). (emphasis added)

318 Memorandum from Thomas M. Armitage, Designated Federal Officer, EPA Science Advisory Board Staff 

Office, to Christopher S. Zarba, Acting Director EPA Science Advisory Board Staff Office, July 29, 2013, 

https://yosemite.epa.gov/sab/sabproduct.nsf/0/7724357376745F48852579E60043E88C/$File/Final%20Determinati

on%20memo_connectivity%20panel%20(unsigned).pdf. (last visited Sept. 18, 2016).
83

the Clean Water Act.”

319

 This would have been impossible, however, as the Connectivity 

Report was finalized after the proposed rule was published, suggesting that the EPA’s 

policy decisions were foregone conclusions.

The EPA deviated from established procedure by releasing the proposed rule before the 

SAB completed its review of the Connectivity Report. According to the SAB’s authorizing 

statute, the EPA Administrator is required to submit any rule proposed under the Clean Water 

Act along with the scientific and technical information underlying the rule to the SAB at the time 

it is provided to any other agency for review.320

Documents show the agencies moved forward with the rulemaking before determining 

whether the science actually supported their decisions. A September 13, 2013 email from Jim 

Laity to Margo Schwab and Dominic Mancini stated:

EPA is now sending the current version of the study for public peer review 

by the SAB, including a deadline for public comments to be considered by 

the SAB. This will be completed before the FINAL rule that relies on this. 

However, they want to submit the NPRM now, so the public will not have 

had a chance to weigh in on it before the rule is proposed. EPA argues 

that they are not using the connectivity study itself, but rather the “science 

on which it is based” as the basis for the proposed rule. What do you 

think?321

Dominic Mancini, the Deputy Administrator of OIRA, responded to Laity. He wrote: 

Unfortunately, I think for primarily political reasons folks thought this 

needed to happen in this kind of simultaneous way. I think the EPA 

‘we are only using the science’ is pretty thin.322

Jim Laity testified he had knowledge that the Connectivity Report—despite being 

considered the scientific basis for the rulemaking—was not finalized until January of 2015, well 

after the final rule was drafted. He stated:

Q During the rulemaking, were you aware that the connectivity report 

was created to serve as the scientific basis for the WOTUS 

rulemaking? 

 

319 SCIENCE ADVISORY BOARD, SAB REVIEW OF THE DRAFT EPA REPORT CONNECTIVITY OF STREAMS AND 

WETLANDS TO DOWNSTREAM WATERS: A REVIEW AND SYNTHESIS OF THE SCIENTIFIC EVIDENCE (Oct. 17, 2014), 

https://yosemite.epa.gov/sab/sabproduct.nsf/fedrgstr_activites/AF1A28537854F8AB85257D74005003D2/$File/EP

A-SAB-15-001+unsigned.pdf.

320 42 U.S.C. § 4365(c)(1) (2014). “The Administrator, at the time any proposed criteria document, standard, 

limitation or regulation . . . is to be provided to any other Federal agency for formal review and comment, shall 

make available to the Board such proposed criteria . . . . .”

321 Email from Jim Laity, OIRA, to Margo Schwab, OIRA, and Dominic Mancini, OIRA (Sept. 13, 2013, 3:00 p.m.) 

(OMB-34473) (unredacted version on file with U.S. Dept. of Justice). (emphasis added)

322 Email from Dominic Mancini, OIRA, to Margo Schwab, OIRA, and Jim Laity, OIRA (Sept. 13, 2013, 3:29 p.m.) 

(OMB-34473) (unredacted version on file with U.S. Dept. of Justice). (emphasis added)
84

A Yes. 

Q The connectivity report was not finalized until January of 2015, well 

after the rule was drafted, and the agencies undertook drafting the 

final rule. At any time during the rulemaking, did you discuss the 

fact that the EPA had not finalized the science underlying the rule? 

A Yes.323

In fact, the science was not finalized prior to the draft rule being published, despite Laity 

testifying to the Committee that Executive Order 12866 requires the agencies to use the “best 

available science” in developing their cost-benefit analysis. Laity stated:

Q All right. Jim, how does OIRA typically review an agency’s cost 

benefit analysis? 

A We read the analysis. And there is a requirement in Executive Order 

12866 to use best available science and economics. And we look at 

methodologies that the agency has used to characterize costs and 

benefits and whatever other impacts are included in the Economic 

Analysis, and we may make comments or ask questions about the 

methodologies that they’ve used.324

Laity asked the agencies why they felt it appropriate to proceed before finalizing the 

science. Laity testified “[the agencies] said there’s already been one review of the Connectivity 

Report, and they felt that, really, they could very easily, in full compliance with all of the 

requirements and our guidance on peer review and everything, have simply said that that was the 

Connectivity Report and we were done.” Realizing this preliminary peer review did not undergo 

public review and comment, Laity shared his concerns with Peck and Schmauder and proposed a 

resolution to release the results publicly.

325

 

323 Laity Tr. at 68-69 (Mar. 8. 2016). (emphasis added)

324 Id. at 57. (emphasis added)

325 Email from Jim Laity, OIRA to Greg Peck, EPA (Dec. 12, 2013 07:19 p.m.).
85

Laity also acknowledged the risk of this strategy by pointing to the peer review results as 

something “which was hopefully favorable.”326 In fact, comments from the first peer review of 

the Connectivity Report did include negative feedback.327 Experts cited various concerns about 

the Report, including:

1. The Report gives the false impression that all information necessary to regulate is 

available;328

2. The Report contains false and misleading data;329

3. Key literature was not included or ignored;

330

4. The Report contains flaws and/or inadequacies in the scientific evidence it provides

as justification;

331

 

326 Id.

327 Peer Review Meeting of EPA’s Draft Report: Connectivity and Wetlands to Downstream Waters – A Review and 

Synthesis of the Scientific Evidence, Post-Meeting Comments (Feb. 16, 2012).

328 Id. Comments submitted by Dr. David J. Cooper at A-5. “The report gives the impression that we know most of 

what is needed to understand and regulate these tributaries and wetlands. I think this is only partially correct.”

329 Id. at A-6. “I also ask EPA to remove concepts suggesting that riparian areas are “transition zones”. This is 

completely false and misleading.”

330 Id. Comments submitted by Dr. Mark Wipfli at A-109. “However, I did not see literature discussed and cited that 

addresses the linkages between headwaters and estuaries and oceans, even though that point is stated in the first 

paragraph of the “Background” section of “Technical Charge to External Peer Reviews” document.” and comments 

submitted by Dr. Arnold van der Valk at 87. “There are a large number of papers that have been published in the 

landscape ecology literature on connectivity and how to measure it. This literature is largely ignored.”

331 Id. Comments submitted by Dr. Mark C. Rains at A-67. “However, I do have comments regarding some flaws 

and/or inadequacies in the scientific evidence provided as justification.”
86

5. Certain analysis will lead to incorrect results;332

6. The Report fails to adequately address the effect of certain types of drainage on 

connectivity;333

7. The Report is missing literature citations and inconsistencies;

334 and

8. The Report contains terminology problems and significant problems with technical

aspects of the conceptual framework.335 

Documents show Laity described this situation to senior OIRA staff several months later, 

noting it violated Information Quality guidelines. In a March 16, 2014 email to Andrei 

Greenawalt, Dominic Mancini, and Cortney Higgins at OIRA, Laity wrote: 

As you know we received a number of letters, including from Congress, 

complaining that EPA is jumping the gun by issuing a proposal before the 

SAB review of the Connectivity report is done. Under the IQ guidelines, 

they are correct. Technically, this type of peer review should be 

available to inform public comments on the proposal. However it turns 

out that EPA did an earlier peer review of the report. We are comfortable 

with them going ahead now, if they provide the peer review report from the 

earlier review in the docket. We can then argue that since SAB review is a 

second peer review, it is not necessary to wait for it to be finished as long 

as they provide us the results of the first peer review to inform public 

comment. We informed EPA of this early on and received no pushback so 

I assumed that they were in agreement, tho they never explicitly agreed.336

SAB Panel members themselves noted that “the usual protocol in science is not to release 

a report before the review is complete.”

337

 One scientist stated: “I must say I am puzzled as to 

 

332 Id. Comments submitted by Dr. Walter K. Dodds at A-41. “Table 5-2, not only is considering a stream without 

riparian influence limiting, it will give incorrect results.”

333 Id. Comments submitted by Dr. William G. Crumpton at A-17. “The report fails to adequately address the effect 

of the subsurface tile drainage on connectivity of these wetlands to downstream waters... [t]his is an extremely 

important issue...”

334 Id. Comments submitted by Dr. James W. La Baugh at A-49. “The reason for the introduction of the concept of 

geographic isolation is missing. Also missing is a literature citation for the statement that vernal pools and coastal 

depressional wetlands are incorrectly referred to as geographically isolated.”

335 Id. Comments submitted by Dr. Rains at A-71. “Throughout the document, there were terminology problems that 

make the basic conceptual framework and the scientific evidence difficult to follow... [t]here are significant 

problems with some of the technical aspects of the conceptual framework... [l]acking a proper conceptual 

framework in this regard, the document will fail to make a strong case not only for hydrological connectivity but 

also for all types of connectivity at spatial and temporal scales that matter in a regulatory environment.” 

336 Email from Jim Laity, OIRA, to Andrei Greenawalt, Dominic Mancini, and Cortney Higgins, OIRA, Mar. 16, 

2014, 10:16 p.m. (OMB-051191) (unredacted version on file with U.S. Dept. of Justice). (emphasis added)

337 SAB Panel Member Comments on the Proposed Rule, at 56 (Aug. 13, 2014) (comments of Dr. Mark Murphy) 

(emphasis added), available at 

https://yosemite.epa.gov/sab/sabproduct.nsf/471B1FB87CF4798B85257D35006088C5/$File/Compilation+of+preli

minary+comments_8_14_14.pdf.
87

why the EPA has decided to release the Proposed Rule before receipt of our review of the 

Connectivity Report.”

338

Dr. Murphy was not alone in his concern regarding the EPA’s decision to release the 

proposed rule prior to receiving the SAB’s review of the Connectivity Report. According to Dr. 

Siobhan Fennessy, not only was she “surprised about the release date of the draft rule,” but also 

concerned that the draft “does not reflect the many suggestions made by the SAB panel to 

strengthen the EPA Connectivity Report.”

339

 

338 SAB Panel Member Comments on the Proposed Rule, at 56 (Aug. 13, 2014) (comments of Dr. Mark Murphy) 

(emphasis added), available at 

https://yosemite.epa.gov/sab/sabproduct.nsf/471B1FB87CF4798B85257D35006088C5/$File/Compilation+of+preli

minary+comments_8_14_14.pdf.

339 SAB Panel Member Comments on the Proposed Rule, at 1 (Aug. 19, 2014) (comments of Dr. Siobhan Fennessy) 

(emphasis added), available at 

https://yosemite.epa.gov/sab/sabproduct.nsf/F771D14F819288BD85257D390079EAFC/$File/Fennessy+Comments

+on+Proposed+Rule_8_19_14.pdf. 
88

The Connectivity Report Was Flawed and Scientifically Unsound

The EPA, in developing the Connectivity Report, consistently disregarded science. 

According to Lance Wood, the Assistant Chief Counsel of the Environmental Law and 

Regulatory Programs with the Corps, there were numerous examples of legal, scientific, and 

procedural concerns pertaining to the EPA’s development of the WOTUS Rule, which “without 

correcting those flaws” left the rule “difficult to defend in court.”

340

 

340 Memorandum from Lance Wood, U.S. Army Corps of Engineers, to Major General John Peabody, U.S. Army 

Corps of Engineers (Apr. 24, 2015). 
89

The Waters Advocacy Coalition (WAC), which “represents a large cross-section of the 

nation’s construction, real estate, mining, manufacturing, forestry, agriculture, energy, and public 

health and safety sectors,”

341 found that “the Connectivity Report, the agencies’ purported 

scientific basis for the proposed rule, and the preamble’s Appendix A fail to address the 

‘significance’ of connections between waters” as required by SWANCC and Rapanos.

342

 

Due to the EPA’s failure to ask “the important questions about the scientific significance 

of these connections for the health or integrity of downstream waters,” the House Committee on 

Science, Space, and Technology, pursuant to its authority under the Environmental Research, 

Development, and Demonstration Authorization Act (ERDDAA), submitted additional charge 

questions to the SAB Panel, specifically requesting that they evaluate the scientific significance 

of the connections.343

 

341 WATERS ADVOCACY COALITION, COMMENTS OF THE WATERS ADVOCACY COALITION ON THE ENVIRONMENTAL 

PROTECTION AGENCY’S AND U.S. ARMY CORPS OF ENGINEERS’ PROPOSED RULE TO DEFINE “WATERS OF THE 

UNITED STATES” UNDER THE CLEAN WATER ACT 2 (Nov. 13, 2014). 

342 Id. at 74. 

343 Letter from the Honorable Lamar A. Smith, Chairman, U.S. House of Representatives Committee on Science, 

Space, and Technology, to Dr. Amanda Rodewald, Chair, Science Advisory Board Panel for the Review of the EPA 

Water Body Connectivity Report (Nov. 6, 2013), available at

https://yosemite.epa.gov/sab/sabproduct.nsf/7FF38D8F9D02345485257C2300685787/$File/11-06-

2013+Science+Committee+Letter+to+Dr++Rodewald+and+Dr++Allen.pdf.
90

Despite Chairman Smith’s direct request for this information, the EPA refused to answer 

and stated the questions “go beyond the scientific review that is the expert panel’s statutory 

focus.”

344

 

 

344 Letter from Laura Vaught, Associate Administrator, EPA Office of Congressional and Intergovernmental 

Relations, to the Honorable Lamar Smith (Dec. 16, 2013) (emphasis added) available at

https://yosemite.epa.gov/sab/sabproduct.nsf/E4735639227A41CE85257C43006DF51F/$File/Chairman+Smith.pdf.
91

In fact, the EPA refused to address these questions despite SAB panel members 

specifically raising concerns that the proposed rule and the Connectivity Report failed to 

adequately address the significance of connectivity. Dr. Genevieve Ali, for example, noted that 

though “the draft rule does include a definition for ‘significant nexus,’” the definition was 

“rather vague and subject to interpretation.”

345

Dr. Ali even addressed the fact that the Connectivity Report did not mention the term 

“significant” and went on to apply a mathematical formula to determine exactly how “‘practical 

significance’ could be applied to the ‘significant nexus’” requirement set forth in Rapanos.

346

 

345 SAB Panel Member Comments on the Proposed Rule, at 6 (Aug. 13, 2014) (comments of Dr. Genevieve Ali) 

(emphasis added), available at 

https://yosemite.epa.gov/sab/sabproduct.nsf/471B1FB87CF4798B85257D35006088C5/$File/Compilation+of+preli

minary+comments_8_14_14.pdf.

346 SAB Panel Member Comments on the Proposed Rule, at 7 (Aug. 13, 2014) (comments of Dr. Genevieve Ali) 

(emphasis added), available at 
92

Dr. Murphy also recognized the direct connection between the “significant” requirement 

under Rapanos’ “significant nexus” test and its applicability to the scientific analysis of the 

Proposed Rule.347

Documents show that despite the concerns that were raised, during the SAB panel’s 

review of the Connectivity Report, “the panel was explicitly told not to discuss the definition of 

significance” or even “the Proposed Rule itself.”

348

 

https://yosemite.epa.gov/sab/sabproduct.nsf/471B1FB87CF4798B85257D35006088C5/$File/Compilation+of+preli

minary+comments_8_14_14.pdf.

347 SAB Panel Member Comments on the Proposed Rule, at 57 (Aug. 13, 2014) (comments of Dr. Mark Murphy) 

(emphasis added), available at 

https://yosemite.epa.gov/sab/sabproduct.nsf/471B1FB87CF4798B85257D35006088C5/$File/Compilation+of+preli

minary+comments_8_14_14.pdf.

348 Id. at 58. (emphasis added)
93

The EPA Disregarded the Corps’ Recommendations and Did Not Conduct 

New Science

According to testimony, the Corps brought their concerns regarding the science to the 

EPA’s attention. According to Moyer, the Corps recommended the EPA “broaden the included 

science to support where the direction of the rule was headed” in the Connectivity Report. 

Moyer testified:

Q Okay. Are you aware of whether the Corps’ Engineer Research and 

Development Center reviewed or made recommendations for 

different or additional science to support the policy decisions that 

were ultimately in the rule?

A The recommendations I’m aware of that ERDC conveyed were to 

broaden the included science to support where the direction of the 

rule was headed in terms of supporting the connectivity between the 

tributaries and some adjacent wetlands and some more isolated 

water bodies.349

Despite these recommendations from the Corps, the EPA ultimately conducted no new 

science and failed to adequately broaden the science per the U.S. Army Engineer Research and 

Development Center’s (ERDC) request, according to Moyer. She stated:

Q Okay. Was the science broadened in the final report per ERDC’s 

recommendations? 

A I think not to the extent that we would have liked it to have been. 

 

349 Moyer Tr. at 38-39 (Dec. 17, 2015). (emphasis added)
94

Q Okay. Did the Army Corps conduct new science on significant 

nexus or how to determine the impacts to physical, biological, or 

chemical integrity of waters? 

A No. No new science. 

Q Did the Corps conduct new science on the five types of water bodies 

the EPA determined to be similarly situated in the rule? 

A No. 

Q Did you ever discuss conducting new science with respect to either 

of these matters? 

A No, we did not discuss conducting new science while we were 

working on developing the final rule.350 

Chip Smith also testified as to the lack of new science conducted in reaction to changes that 

occurred late in the rulemaking. Smith stated:

Q You previously mentioned that changes were made late in the 

rulemaking to appeal to concerns of the USDA and DOT but that 

the Army and Corps did not study those concerns, establish potential 

solutions, propose options, or brief principals on those changes. Are 

these all things that you would consider a necessary part of the 

rulemaking process?

A Yes. 

Q Can you explain why this didn’t happen with respect to these 

changes?

 

A We would have needed to stop and do some science and evaluate 

why for decades we had regulated certain ephemeral and 

intermittent ditches and other water bodies adjacent to farmlands 

and then suddenly pulled them out of the final rule without any 

scientific justification whatsoever. It was entirely a policy call.

Q And it was a policy call not because science wasn’t required to move 

forward with it, or was there some other reason why you say it was 

a policy call? 

A It was a policy call so the EPA could offer USDA something to 

reduce the burden of regulation on farmers, real or perceived, so that 

USDA would chop and let OIRA move the rule forward. 

 

350 Id. at 39 (Dec. 17, 2015). (emphasis added)
95

Q And it was EPA’s belief that this effort to appeal to the farmers or 

ag community would allow the agencies to move forward with 

WOTUS generally?

A Yes.

Q Okay. Was it also a matter of timing?

 

A It was tied up with the schedule and the desire to get this done in 

May. As I think I previously testified, there were a whole suite of 

regulations, I think many of which are now out on the street. And 

we were told they had a queue set up and they needed to keep the 

order going so that one didn’t tromp on the other. And so schedule 

did play a factor.

Q So schedule played a factor in not conducting the science that –

 

A Absolutely.

Q Okay.351

The EPA Limited Changes to the Final Connectivity Report and Ensured It

Supported the Proposed Rule

Under the APA,352 a final rule must be a “logical outgrowth” of the proposed rule. As 

stated by the D.C. Circuit, “[g]iven the strictures of notice-and-comment rulemaking, an 

agency’s proposed rule and its final rule may differ only insofar as the latter is a ‘logical 

outgrowth’ of the former.”

353

 Put differently, courts refuse “to allow agencies to use the 

rulemaking process to pull a surprise switcheroo on regulated entities.”

354

The fact that the proposed rule was released for notice and comment prior to the 

conclusion of the Connectivity Report, which the agencies purported to be the scientific basis for 

the proposed rule, highlights that the agencies were likely incentivized to prevent the SAB, the

Corps, or any other commenting party from altering the scientific basis behind the rule to the 

point that it would no longer be considered a “logical outgrowth.” For example, had the agencies 

conducted new science or allowed the SAB to respond to Chairman Smith’s request for more 

information as to the significance of the connections identified in the Connectivity Report, such 

 

351 Smith Tr. at 36-37 (Feb. 19, 2016).

352 5 U.S.C. §§ 551-559.

353 Envtl. Integrity Project v. E.P.A., 425 F.3d 992, 996 (D.C. Cir. 2005); see also Shell Oil Co. v. EPA, 950 F.2d 

741, 750–51 (D.C.Cir.1991); Northeast Maryland Waste Disposal Auth., 358 F.3d at 952 (stating a final rule is a 

“logical outgrowth” of a proposed rule only if interested parties “ ‘should have anticipated’ that the change was 

possible, and thus reasonably should have filed their comments on the subject during the notice-and-comment 

period”) (quoting City of Waukesha v. EPA, 320 F.3d 228, 245 (D.C.Cir.2003)).

354 Envtl. Integrity Project v. E.P.A., 425 F.3d 992, 996 (D.C. Cir. 2005). 
96

information may have required the agencies to significantly revise the rule, ultimately requiring 

the agencies to begin the notice and comment process anew.355 Documents and testimony create 

the appearance that this is precisely what happened, which undermines the entire rulemaking 

process, particularly as the public was likely unable to provide comments on a proposed rule that 

reflected science contained in the final Connectivity Report. 

The Peer Review Process Was Flawed

Throughout the rulemaking, the agencies repeatedly showed disregard for the peer review 

process of the Connectivity Report. According to OMB, “[p]eer review is one of the important 

procedures used to ensure that the quality of published information meets the standards of the 

scientific and technical community.”

356

OMB guidance lays out a thorough process that involves a critique of scientific works by 

experts to help clarify the hypotheses, validity of the design, robustness of methods, and quality,

of the data.357 The reviewers evaluate whether the conclusions follow from the analysis and 

provide feedback on the strengths and limitations of the product.358 OMB also provides that it is 

essential to use the feedback received in the peer review process for improving the product and 

ensuring that the science behind government policy is valid.359 It continues:

In addition, the credibility of the final scientific report is likely to be 

enhanced if the public understands how the agency addressed the specific 

concerns raised by the peer reviewers. Accordingly, agencies should 

consider preparing a written response to the peer review report explaining: 

the agency’s agreement or disagreement, the actions the agency has 

undertaken or will undertake in response to the report, and (if applicable) the 

reasons the agency believes those actions satisfy any key concerns or 

recommendations in the report.360

According to the guidance, “A peer review is considered completed once the agency 

considers and addresses the reviewers’ comments.”

361

 

 

355 Alaska Prof'l Hunters Ass'n, Inc. v. FAA, 177 F.3d 1030, 1034 (D.C.Cir.1999) (“When an agency has given its 

regulation a definitive interpretation, and later significantly revises that interpretation, the agency has in effect 

amended its rule, something it may not accomplish without notice and comment.”).

356 Memorandum, from Joshua Bolten, Director, Office of Management and Budget, “Issuance of OMB’s Final 

Information Quality Bulletin for Peer Review” 3 (Dec. 16, 2004) available at:

https://www.whitehouse.gov/sites/default/files/omb/memoranda/fy2005/m05-03.pdf. 

357 Memorandum, from Joshua Bolten, Director, Office of Management and Budget, “Issuance of OMB’s Final 

Information Quality Bulletin for Peer Review” (Dec. 16, 2004) available at:

https://www.whitehouse.gov/sites/default/files/omb/memoranda/fy2005/m05-03.pdf. 

358 Id. 

359 Id. 

360 Id. at 3.

361 Id. at 21. 
97

With respect to the Connectivity Report, the documents and testimony show the 

agencies treated the peer review process as a mere box to check, and did not 

meaningfully engage in addressing the comments that came out of the reviews. 

The late completion of the peer reviewed scientific basis of the rule runs counter to 

OMB’s guidance, which states:

If the scientific information is used to support a final rule then, where 

practicable, the peer review report shall be made available to the public with 

enough time for the public to consider the implications of the peer review 

report for the rule being considered.362

The guidance describes the public notice of the peer review study as “important”: 

When an information product is a critical component of rule-making, it is 

important to obtain peer review before the agency announces its regulatory 

options so that any technical corrections can be made before the agency 

becomes invested in a specific approach or the positions of interest groups 

have hardened. If review occurs too late, it is unlikely to contribute to the 

course of a rulemaking. Furthermore, investing in a more rigorous peer 

review early in the process “may provide net benefit by reducing the prospect 

of challenges to a regulation that later may trigger time consuming and 

resource draining litigation.363

Despite the importance of peer review, OIRA failed to incorporate an evaluation of 

the peer review process into its Executive Order 12866 review. OIRA deferred to the 

EPA, not simply on whether the science was right, but also on whether they complied 

with the peer review process outlined in the OMB guidance. Laity testified:

Q The connectivity report was not finalized until January of 2015, well 

after the rule was drafted, and the agencies undertook drafting the 

final rule. At any time during the rulemaking, did you discuss the 

fact that the EPA had not finalized the science underlying the rule? 

A Yes. 

Q And what were those discussions like? 

A We asked them about that. In fact, I think some of that’s implicit in 

this email. And the answer that they gave was that they felt very 

comfortable that the substantive science was done. There had 

already, I think—let me just refresh my memory by looking at this, 

but I think there had already been one peer review of the 

connectivity report. 

 

362 Id. at 26. 

363 Id. at 14-15. 
98

* * *

Q Did you or anyone else in OIRA, to your knowledge, engage with 

the EPA and Army Corps to ensure that the concerns from this peer 

review were addressed? 

A No, I don’t believe we did. I’m not a scientist, and my feeling was 

that, as long as they followed the process—which, I have to say, it 

seemed to me a very rigorous process that they were going through, 

both an internal peer review process first and then going through an 

external peer review—and that if the peer reviewers, who were 

scientists, were satisfied that the report represented the best 

available science, then that was good enough for me, and I didn’t 

need to kind of look—I read, like I said, the executive summary of 

the report, made my judgments about its relevance to the 

rulemaking. But I felt like the process that they went through 

ensured that it was good science, and it wasn’t my role to get down 

in the weeds and second-guess the science.364

Documents and testimony show OIRA’s review process essentially involved asking the 

EPA whether they engaged in a peer review process, rather than conducting meaningful 

oversight of the process itself. Laity testified:

Q But you did say, on some level, OIRA does engage with an agency 

to evaluate the analysis it undertakes in a rulemaking, correct? 

A Yes, it does. But, you know, we can’t redo all the analyses. I mean, 

our job is to look and see, did they do a good job. And when you 

come to me with a report and say, this went through all this peer 

review and the peer reviewers generally were satisfied with it—I 

mean, I don’t remember exactly what they told me, but I presume 

they told me that, or we would have had more discussions about it—

and then you say, and, by the way, we’re going to do a second round 

of peer review with our Science Advisory Board, and that’s a very 

public process, that’s a pretty gold-plated process for getting good 

science. So I was satisfied with that.365

Documents and testimony show OIRA was uncurious about much of the process and 

analysis underlying the rule. When asked about OIRA’s involvement in the peer review process,

Laity testified that he was unaware that the SAB did not have a copy of the proposed rule before 

it was submitted to OIRA.366 Without reviewing the quality of the Connectivity Report, OIRA 

 

364 Laity Tr. at 68-69, 71 (Mar. 8, 2016).

365 Id. at 72.

366 Id. at 74-75. 
99

had little knowledge of who knew what, whether information was shared, and whether there was 

a consensus for the analysis or the underlying rule. 

OIRA was further unaware that the Corps did not believe the Connectivity Report did not 

support the conclusions of the rule. Laity testified:

Q Were you aware that the Corps and Army took no part in the creation 

of the connectivity report? 

A “No part” is a strong statement. I was aware that it was primarily an 

EPA product. I didn’t know for—I mean, I don’t know for sure that 

they had no part in it, but I was aware that it was primarily an EPA 

product. 

Q Were you aware of the Army Engineer Research and Development 

Center or ERDC’s conclusions that the report science needed to be 

broadened in order to support the rule in terms of supporting the 

connectivity between tributaries, adjacent wetlands, and isolated 

water bodies? 

A No. 

Q Did you review any of ERDC’s recommendations throughout the 

rulemaking?

A Not that I recall.367

Testimony shows OIRA was also unaware the Economic Analysis was not a joint product 

of the EPA and Corps. OIRA simply assumed that it was a joint product.368 Laity testified: 

“My understanding at the time, although I admit I never asked this question, was that it was a 

joint product. I wasn’t aware there was a disagreement, if there was.”

369

 

Laity testified that he did not read the entire Connectivity Report,

370 instead basing his 

review on a reading of the Report’s executive summary. This occurred despite the fact that 

Executive Order 12866 specifically directs OIRA to review agency draft regulations before 

publication to ensure agency compliance with the Executive Order and holds that OIRA “is the 

repository of expertise concerning regulatory issues, including methodologies and 

procedures.”

371 Laity stated:

Q Did you read the connectivity report? 

 

367 Id. at 81.

368 Id. at 59 (“I definitely had the impression, although I'm not sure where I got it, that the Corps did the part where 

they looked at their database—it was their database, and they looked at their database, and they looked at the 

decisions, and then they made judgments about how the decisions would have been made differently.”).

369 Id. at 59.

370 Id. at 57.

371 Exec. Order No. 12866, 58 Fed. Reg. 15315 (Oct. 4, 1993). (emphasis added)
100

A I read the executive summary. It was several hundred pages long. 

I’m not a scientist. I didn’t read the whole thing. But I did read the 

executive summary, and I did have a sense of, sort of, from a 50,000 

foot level what it said.

Q During the rulemaking, were you aware that the connectivity report 

was created to serve as the scientific basis for the WOTUS 

rulemaking? 

A Yes.372

The documents and testimony obtained by the Committee show OIRA failed to conduct a 

thorough review of the basis for the rule, allowing EPA to push the rule through the regulatory 

process before its scientific basis was finalized, without consensus, and without transparency.

OIRA simply read the executive summary, took EPA’s word for the completeness of the work, 

and moved on. OIRA failed to ask whether the peer review comments were addressed or 

considered.373 OIRA did not inquire into whether additional science was needed.374 OIRA did 

not verify that the process complied with OMB guidance. 

 

The WOTUS “Adjacency Limits” Are Not Based on Science 

A significant provision in the final WOTUS rule provides that waters within 4,000 feet of 

the high-water mark of navigable waters subject to CWA jurisdiction could also fall under the 

Act’s jurisdiction.375 However, this expansion of jurisdiction under the CWA did not originate 

from, or develop as part of, the proposed rulemaking.376 Documents and testimony show the 

limits were developed without scientific evaluation, were not vetted through the Corps, and did 

not go through the public comment process. In fact, the EPA’s Connectivity Report itself 

advises against using specific distance thresholds in the rule.377 

When asked about the development of the adjacency limits, the Army’s Craig Schmauder 

suggested that the agencies were responding to the public’s repeated requests for “bright lines.” 

Schmauder testified: 

 

372 Laity Tr. at 68 (Mar. 8. 2016).

373 Id. at 78 (“In this case, OIRA did not really get involved in the science underlying the rule, other than to 

understand what the report said about the science. So we didn't have a lot of discussions or disagreements or 

anything about the science. So, I don't recall that we—that we really dug into the details of the peer review.”). 

374 Id. at 82 (Mar. 8, 2016) (“Q At any point in your review, did you discuss a need to conduct additional 

science? A No.”).

375 Clean Water Rule: Definition of “Waters of the United States,” 80 Fed. Reg. 37054 (June 29, 2015) (to be 

codified at 40 C.F.R. pts 110, 112, 116, et.al.), available at https://www.epa.gov/sites/production/files/2015-

06/documents/epa-hq-ow-2011-0880-20862.pdf.

376 Schmauder Tr. at 89-93 (Feb. 17, 2016).

377 Connectivity of Streams and Wetlands to Downstream Waters: A Review and Synthesis of the Scientific 

Evidence, Office of Research and Development, U.S. Environmental Protection Agency, Sept. 2013, available at

http://cfpub.epa.gov/ncea/cfm/recordisplay.cfm?deid=238345#Download.
101

Q How are these distance limits determined? 

A How were they arrived at? Is that what you’re asking?

 

Q Sure. 

A They were proposed by—well, first of all, I should say that the 

notion of having specific bright lines or distance limitations was 

raised in many of the outreach stakeholder-type discussions.

So the point I’m trying to make is that we were getting pretty good 

feedback in the outreach of stakeholders that people were 

uncomfortable with the concepts in the proposed rule. And many 

times they suggested clear bright lines. So we had that in mind. 

EPA proposed the bright lines that we had. They were initially 

raised, I think, as a straw man like 5,000-foot, and then we—I think 

EPA did some analysis and came up with the 4,000 foot bright line; 

while it would give everybody a bright line, we felt captured the 

bulk of the jurisdictional water bodies that that particular category 

wanted to regulate.378 

Schmauder acknowledged, however, that these comments did not, in fact, seek specific distance 

limits. He testified:

Q Were those comments about bright lines specifically asking for 

[4,000 foot] distance limits? 

A Not specifically, no. We certainly didn’t provide any specific 

numbers in the proposed rule.379

Moyer testified that neither EPA nor the Corps solicited comments on the 4,000 foot standard. 

She stated:

Q Okay. Were public comments on specific distances sought, 

received, or considered? 

A A specific distance was not specifically—public comment on a 

specific distance was not solicited. It certainly was referred to that 

a proximity was in the proposed rule as something the agencies 

would consider as setting a distance threshold. But specific distance 

thresholds were not put out as something for the public to comment 

on.380

 

378 Id. at 89-90.

379 Id. at 92.

380 Moyer Tr. at 96 (Dec. 17, 2015).
102

Schmauder stated that he was “informed” of the decision-making underlying the 4,000 

foot adjacency limit, but could not “recall any of the details of the analysis” for the 

Committee.381 He said that the EPA would have consulted Moyer at Army Corps about

establishing this standard.382

Contrary to Schmauder’s testimony, however, Moyer testified that neither she, nor 

anyone at the Corps working on the WOTUS rule, participated in the formulation of the 

adjacency limits. Moyer stated:

Q Okay. So you are unaware of who decided those [4,000 foot] limits, 

then?

 

A Correct.

Q Okay. And are you aware of the bases underlying the distances that 

were set? 

A No.

Q Were you ever consulted about the distances that were set? 

A No. I was not.383

Moyer testified the adjacency limits had no basis in science, and that problems arose 

regarding implementing the limits. She testified a “bright line” standard such as the adjacency 

limits is not supported by science. She stated: 

Q So at some point, because we have so many different interpretations 

of what that line should be, whether it’s a linear line, definition line, 

or something else, at some point someone has to strike what that is? 

Is that right? 

A I believe it should be supported by science, and science doesn’t 

draw a line on the landscape.384

Laity testified that when he asked the EPA about the origin and basis of the adjacency 

limits, he was told that, rather than being based on science, they were merely “judgement calls”

contrived by the EPA.385 He stated:

The answer that I got when I said where do these [adjacency] lines come 

from was essentially that there—there isn’t any science that will say it 

 

381 Schmauder Tr. at 90 (Feb. 17, 2016).

382 Id. at 90.

383 Moyer Tr. at 96 (Dec. 17, 2015).

384 Id. at 73.

385 Laity Tr. at p. 88 (Mar. 8, 2016).
103

should be 100 feet, if not 110 feet, or 4,000 feet, but not 3500 feet. But that 

if—if you don’t draw lines, then you’re basically left having case specific 

determination about everything, which was something that OIRA certainly 

agreed with the agencies that it would be better to move away from that. 

And so they felt that this was basically a judgment call that’s coming out of 

the connectivity report, that these were lines that were a reasonable balance 

of essentially—that the standard for—that was established in Justice 

Kennedy’s opinion for what constitutes a jurisdictional water is that it has a 

significant nexus to a navigable, in fact, water.386 

Moyer told the Committee that bright line delineations can be helpful in rulemakings, but 

in the case of WOTUS, bright lines are impractical and “hard to implement.” She testified: 

Q Do bright line delineations offer clarity to the regulated public? 

A They do. And why you’re seeing me cock my head a little bit is I 

think bright lines are very helpful I think when, and I will say when 

you read the rule, the language is clear, they’re grammatically 

correct sentences. But when you read a 4,000 foot threshold, that’s 

easy to understand. It’s harder to implement on the ground. 

Because, and this is going to sound funny and it is in a certain sense, 

but nobody has a 4,000 foot long tape measure. And it’s hard to 

implement that. 

So for the regulated public, the questions we get back is how do I 

know when I’m 4,000 feet away. You know, my wetland in my 

background, how do I know where the nearest thing that I’m 

measuring to is, how do I know where it is. So those are the 

questions that we get back. So the language can be very clear, but 

it’s the actual practical implementation of it that gets tricky. So I 

guess that’s a very long way of answering your question. 

So, yes, the regulated public does benefit from clear, bright lines. 

But the implementation piece does get to be a challenge. But I think 

it’s a challenge that can be overcome with follow on guidance and 

materials that we can use with the public.387 

The documents show OIRA itself acknowledged that public comments and a robust discussion of 

options would be “especially helpful” with respect to defining adjacency limits in the rule. An 

internal OIRA document titled “Waters of the US Outstanding Policy Issues” stated:

Definition of Adjacency: The rule proposes a revised definition of adjacency 

that is more precise and science based than the existing definition. However, 

 

386 Id.

387 Moyer Tr. at 146-147 (Dec. 17, 2015). (emphasis added)
104

the proposed definition retains significant ambiguity, which DOJ has 

suggested makes it vulnerable to legal challenge.

* * *

OIRA staff recommends that the rule provide greater clarity on the 

definition of adjacency. This is an area where public comment may be 

especially helpful, so a robust discussion of options and request for 

comment would be in order.388

OIRA acknowledged issues with the agencies’ implementation of new distance limits right 

before the rule’s release. Documents show that on May 14, 2015, Laity emailed Dominic 

Mancini, OIRA’s Deputy Administrator, about adjustments to the distance limits. Laity wrote: 

“I think this goes in the wrong direction . . . .” Mancini responded: “Thanks. Frustrating.”

389

 

388 OIRA, Waters of the US Outstanding Policy Issues (Jan. 9, 2014) (OMB-045601).

389 Email from Dominic Mancini, OIRA, to Jim Laity, OIRA (May 14, 2015, 6:51 p.m.) (OMB-027016).
105
106

A DISREGARD FOR THE RULEMAKING PROCESS

Federal agencies are subject to a number of requirements prior to, and upon issuing, a 

final rule. These requirements are meant to ensure that a rule is developed in a transparent 

manner while achieving the desired policy results. The documents and testimony show 

rulemaking agencies ran afoul of a number of statutes and executive orders in their development 

and promulgation of the WOTUS rule.

The Agencies Did Not Consider Alternatives Until After the Rule Was 

Drafted

FINDING: The agencies did not consider alternatives to the rule, and even 

went so far as to gut the discussion of alternatives after OIRA stated 

such discussion was necessary.

Under Executive Order 12866, agencies are required to identify and assess alternatives to 

direct regulations and to identify and assess alternative forms of regulation.390 Specifically, 

when an agency is engaging in a significant regulatory action, the assessment must include a 

discussion of feasible alternatives and “why the planned regulatory action is preferable to the 

identified proposed alternatives.”

391

 The presentation of alternatives is meant to occur prior to 

issuance of a proposed rulemaking rather than after the fact, or as a way to bolster the agencies’

argument in favor of a certain regulation.392

In the case of the WOTUS rule, the EPA did not consider alternatives until after the 

proposed rule was drafted. Jim Laity of OIRA identified this as a violation of standard practice. 

In an email, Laity wrote: “Based on the leaked draft, a lot of stakeholders are complaining that 

the rules reads like substantive decisions have already been made, and includes no ‘alternatives’

as required by EO 12866. This is a fair concern.”

393

 

390 Exec. Order No. 12,866, 58 Fed. Reg. 51,735 (Oct. 4, 1993), available at

https://www.whitehouse.gov/sites/default/files/omb/inforeg/eo12866/eo12866_10041993.pdf. 

391 Id.

392 Id.

393 Email from Jim Laity, OIRA, to Gregory Peck, EPA (Dec. 12, 2013, 7:19 p.m.).
107

The email shows the rule was already drafted when the EPA began inventing alternatives 

that might satisfy the requirements under Executive Order 12866. Laity testified about the email 

when he appeared before the Committee for a transcribed interview. He stated:

Q In this email, you tell Mr. Peck and Mr. Schmauder that, quote, “a 

lot of stakeholders are complaining that the rules read like 

substantive decisions have already been made, and includes no 

‘alternatives’ as required by Executive Order 12866. This is a fair 

concern,” close quote. Can you explain your comment that this is a 

fair concern with respect to the rule at this stage? 

A Executive Order 12866 requires that agencies present both their 

preferred—this is at the proposed rule stage—present both their 
108

preferred regulatory option and reasonable alternatives to the 

regulatory option. And, in implementing the Executive Order 

requirements, there is always a rule of reason where, sort of, the 

bigger and more important the rule is, the more effort one puts into 

things like the cost-benefit analysis and developing the reasonable 

alternatives and so on. 

This was a very important rule, and I’m expressing the opinion there 

that it is important that the proposed rule include some regulatory 

alternatives and that, I guess—I don’t remember the details of what 

led me to write this email, but I guess that we were hearing either in 

the press or—I think you know we have a process where 

stakeholders can come in and talk to us about a rule under review. 

And maybe we were hearing from stakeholders that they have—I 

had forgotten this, but I guess the rule was leaked and that they had 

seen it and had concerns of this nature. 

Q And you would expect at the proposed rule stage, like you said, per 

the Executive Order, that the agencies to this point have assessed 

and considered alternatives? 

A The Executive Order requires that the proposed rule present a range 

of alternatives. And I do feel I need to add that the proposed rule 

did, in fact, when it went out, include a number of substantive 

alternatives and a fairly detailed discussion of them in order to 

request informed public comment on those alternatives. 

Q So when you say this is a fair concern, you don’t recall why you said 

that it was a fair concern that it did not include alternatives? 

A What—

Q Or were you referring to the—

A If you read on in that paragraph, I go on to suggest specific ways in 

which the rule can request comment on specific alternatives. So, 

you know, “this is a fair concern” essentially is a way of saying: I 

think that you should consider requesting comment on some of these 

alternatives, and here they are, here are examples. 

And, actually, the final proposed rule that was published in the 

Federal Register had quite a bit more substance than this and 

addressed a fairly broad range—I think it had four other major 

alternatives to the proposed rule—as well as the specific requests for 

comments on some of the smaller issues that are mentioned in this 

paragraph, like breaks in jurisdiction and stuff like that. 
109

Q Were you concerned at all with the comment that it reads like 

substantive decisions had already been made? 

A You know, sometimes when I’m writing emails, we all know each 

other pretty well, and I speak colloquially or informally or 

carelessly. And so I think that my intention in writing this email 

was to get the attention of the agencies and convince them that it 

would be appropriate to include some regulatory alternatives in the 

proposed rule, which they agreed to do.394

Documents and testimony show OIRA’s subsequent assertions that the proposed rule

ultimately did include some alternatives ignores the fact that the agencies should have considered 

and included alternatives in their development of the rule in the first instance, as required. 

In fact, OIRA negotiated specific language with the EPA, including four recommended 

alternatives to include in the proposed rule for public comment. These were outlined in an 

internal OIRA memorandum from January 2014.395

(continued next page)

 

394 Laity Tr. at 64-67 (Mar. 8, 2016).

395 Id.
110
111

Specifically, OIRA recommended that providing a categorical exemption for isolated 

waters would provide the added clarity called for in the rulemaking, and meet the goal of 

increasing regulatory certainty.396 Documents show, however, that after this negotiation and 

addition of alternatives and before the proposed rule was publicly released on April 21, 2014, the 

EPA did an entire re-write the alternatives discussion, striking this option in its entirety. OIRA 

staff discussed their concerns that the draft again failed to meet the requirements of EO 12866 

because it did not include a sufficient discussion of alternatives. In a March 16, 2014 email to 

Andrei Greenawalt and Dominic Mancini, Jim Laity wrote: 

The other waters section of the preamble has been entirely written in a way 

that I no longer find acceptable. 

There are two fundamental problems with this rewrite. First, the earlier 

version had four distinct alternative options for addressing other water that 

spanned a reasonable range of possible approaches. Presenting alternatives 

in [sic] required by EO 12866 for economically significant rules, and the 

leaked draft was criticized by stakeholder groups in our meetings with the 

public for failing to comply with this requirement. The addition of specific, 

well-defined options not only informs public comment but signals to the 

public that there are well-developed alternatives that the agency is 

considering and it puts the rule writing agency in a realistic position to 

finalize one of the presented options without a new proposal. For these 

reasons the inclusion of these options was critical to my support of the 

previous draft. As an aside, I believe it was also critical to the buy-in of 

several other agencies that shared our concerns, such as DOJ and DOT and 

while the SBA still believes a SBREFA panel is required, they were also 

very supportive of including the new options.

In place of these four distinct options the new preamble now has a long, 

disorganized series of requests for comment on just about everything they 

could possibly request comment on regarding other waters. While almost 

all the important ideas are in there somewhere (I say almost bc one that is 

critical to OIRA’s preferred option is now missing entirely), the new 

discussion does not provide any coherent alternatives to the proposed 

approach, and gives the public no organized alternatives to react to. It 

also no longer conveys the sense that alternatives are fully fleshed out 

ready for prime time approaches that the agency might reasonably 

adopt in the final rule. It is my judgement that for the agency to adopt an 

approach that was significantly different from the proposed approach based 

on this version of the preamble would be legal vulnerable and not fair to the 

public, and the agency would likely feel (and we would agree) that a NODA 

or re-proposal was necessary.

The second big problem is that the OIRA preferred option (at least my 

 

396 OIRA, Waters of the US Outstanding Policy Issues (Jan. 9, 2014) (OMB-045601-6).
112

preferred option) has disappeared entirely. That is it cannot even be 

pieced together from the disjointed series of requests for comment that 

remain. In a nutshell, the option is that all other water would either be 

categorically jurisdictional or categorically non-jurisdictional, so that case 

by case determinations and all the uncertainty and resource intensive 

transactions that they entail for both the government and regulated entities 

would be eliminated.397

Mancini responded:

I note that they explicitly deleted the characterization of these as 

alternative for consideration, which can only make it harder to finalize 

something other than their proposal. I can’t see how that could be a good 

thing, whatever folks’ policy coming in. I would also note that this is more 

or less significant rewrite of the entire package and even if we could become 

more comfortable with this I think it would take a while to process. 398

Laity replied. He stated that the EPA should include something to signal to the public that it is at 

least considering one option that would not be a major jurisdictional expansion. Laity wrote:

Yes, this language is what is left of OIRA’s preferred option. 

What’s missing is the idea that waters for which the science is inconclusive 

would also be non-jurisdictional by rule, until the science evolves further. 

Since it is likely that there will be a large share of isolated waters in this 

category, without this provision there will still be lots of case by case 

determinations with all the problems they entail. I am not asking the agency 

to make this choice now, in fact, I deliberately dropped the idea of pushing 

this to be a “co-proposed” option bc I knew it would be difficult fur [sic] 

them to accept and it doesn’t need to be to keep it on the table for the final 

rule. But it does need to be clearly described in a coherent option to 

inform public comment and signal to those who will characterize this a 

[sic] major jurisdictional expansion that the agency is at least seriously 

considering one option that would not be.

I also note that Justice Kennedy, whose opinion forms the basis of the rule, 

said that in order for a nexus to be significant it might be more than 

“speculative or insubstantial.” This language is used repeatedly throughout 

the proposal in both rule and preamble text. In my mind, where the science 

is inconclusive any nexus to navigable waters cannot by definition be more 

than speculative. Thus I think the approach I favor is actually the most true 

to Kennedy’s opinion. I also think senior staff in OW [EPA Office of Water]

were willing to present it as one option bc they realize this too, as much as 

 

397 Email from Jim Laity, OIRA, to Andrei Greenawalt, OIRA, and Dominic Mancini, OIRA (Mar.16, 2014, 04:33 

p.m.) (OMB-051166) (unredacted version on file with U.S. Dept. of Justice). (emphasis added)

398 Email from Dominic Mancini, OIRA, to Jim Laity, Andrei Greenawalt and Cortney Higgins, OIRA, Mar. 17, 

2014, 12:09 a.m. (OMB-051193) (unredacted version on file with U.S. Dept. of Justice). (emphasis added)
113

they would like to leave open the possibility of claiming jurisdiction over 

everything.399

Documents show that the EPA’s re-write was done personally by EPA Administrator McCarthy. 

After a call with Administrator McCarthy to discuss OIRA’s concerns, Shelanski emailed his 

staff. He wrote: “One additional point: Gina made clear this was her doing not staff’s.”

400

Despite OIRA’s substantial concerns, Shelanski allowed the proposed rule to move 

forward without including OIRA’s most meaningful text. In an email to Andrei Greenawalt and 

Jim Laity on March 23, 2014, Shelanski wrote:

I’ve had a lot of back and forth over the last 2 days with Gina about the edits 

Jim sent on 3/21. Email is not the place to rehash the details, but the short 

story is this: she wanted to stick with the draft before those edits, and planted 

her feet pretty hard on that; I explained why we did not want to do that; she 

and I discussed the issues (she has some good points); I then sent my own 

edits which do 2 things (1) clarify that case-by-case is for subcategories 

where science shows neither presence NOR ABSENCE of significant nexus 

for the class as a whole; and (2) that EPA is taking comment on the 

appropriate use of case-by-case determinations generally. The strongest 2 

of Jim’s edits on non-jurisdictionality are out but the rest of most there [sic].

Gina has no [sic] accepted those edits. I think this is a reasonable 

compromise at this stage.

401

WOTUS Was Based On a Flawed NEPA Analysis

Documents and testimony show the EPA and the Army failed to comply with a law 

mandating that regulations substantially affecting the human environment, such as WOTUS, 

receive enhanced analysis and scrutiny. Specifically, the National Environmental Policy Act 

(NEPA) formally “declares that it is the continuing policy of the Federal Government...to use all 

practicable means and measures . . . to create and maintain conditions under which man and 

nature can exist in productive harmony . . . .”

402

 NEPA requires a federal agency to prepare an 

environmental impact statement (EIS) for any major federal action “significantly affecting the 

quality of the human environment.”

403

 All federal agencies must determine if a NEPA analysis 

is necessary or not.404

 

399 Email from Jim Laity, OIRA, to Andrei Greenawalt, Dominic Mancini, and Cortney Higgins, OIRA, Mar. 17, 

2014, 1:08 a.m. (OMB-051195) (unredacted version on file with U.S. Dept. of Justice). (emphasis added)

400 Email from Howard Shelanski, OIRA, to Dominic Mancini, OIRA (Mar. 17, 2014, 11:52 a.m.) (OMB-051213) 

(unredacted version on file with U.S. Dept. of Justice).

401 Email from Howard Shelanski, OIRA, to Andrei Greenawalt and Jim Laity, OIRA (Mar. 23, 2014, 05:36 p.m.) 

(OMB-051253) (unredacted version on file with U.S. Dept. of Justice). (emphasis added)

402 The Nat’l Environmental Policy Act of 1969, Pub. L. No. 91-190, 83 Stat. 852 (1970; 42 U.S.C. § 4331(a) 

(2006). 

403 Id. § 4332(2)(C); State of N.C. v. F.A.A., 957 F.2d 1125, 1128 (4th Cir. 1992).

404 42 U.S.C. § 4332(2). 
114

To determine the need for an EIS, an agency must first prepare an Environmental 

Assessment (EA).405 An EA is generally “a concise public document that (1) provides sufficient 

evidence and analysis for determining whether to prepare an EIS or a finding of no significant 

impact (FONSI); (2) aids agency compliance with NEPA when no EIS is required; and (3) 

facilitates preparation of an EIS when one is necessary.”

406 The EA must include a discussion of 

the need for the proposed rule, alternatives to the rule, impacts of both the rule and the 

alternatives, and a list of individuals and agencies consulted during the process.407

If an EIS is necessary, notice of the agency’s intent to prepare it is first published in the 

Federal Register.

408

 Elements of an EIS include: a statement expressing the purpose and need 

for the proposed regulation; alternatives to the rule; a description of the affected environment; an 

analysis of likely environmental consequences; and a list of the person(s) preparing it.409 The 

agency preparing the EIS must also request comments from all interested entities, including 

federal, state, local and tribal governments, and the public.410

If the agency decides no EIS is required because the proposed action will not have a 

significant impact on the human environment, the agency produces a FONSI.411 Unlike the more 

detailed EIS, a FONSI simply presents reasons why the agency determined no significant 

environmental impact would occur due to the rule.412

The following chart outlines the NEPA process: 413

 

405 40 C.F.R. § 1508.9 (1991).

406 LINDA LUTHER, Cong. Research Serv., RL33152, The National Environmental Policy Act (NEPA): Background 

and Implementation; CRS (2011) available at http://nationalaglawcenter.org/wpcontent/uploads/assets/crs/RL33152.pdf. 

407 Id. 

408 Id. at 18. 

409 See e.g., id. 

410 Id. 

411 40 C.F.R. § 1508.13 (1991).

412 U.S. Environmental Protection Agency, National Environmental Policy Act Review Process, available at 

https://www.epa.gov/nepa/national-environmental-policy-act-review-process#ea (last visited Oct. 24, 2016).

413 Certain projects recognized as having no significant economic impacts, such as landscaping or the installation of 

traffic signals, are excluded from the requirement that an EA or EIS be prepared. These recognized exclusions are 

called “Categorical Exclusions.” See LINDA LUTHER, Cong. Research Serv., RL33152, The National 

Environmental Policy Act (NEPA): Background and Implementation; CRS (2011).
115

Source: Cong. Research Serv., “The National Environmental Policy Act (NEPA): 

Background and Implementation,” Report No. RL33152 (2011).

The final NEPA documents, including the EA and EIS/FONSI, are submitted to the 

OIRA for interagency review at the same time.

414

 

414 Smith Tr. at 11-12 (Feb. 19, 2016).
116

A. THE ARMY DISREGARDED NEPA PROVISIONS TRIGGERED BY SIGNIFICANT NEW 

CHANGES AND PREDETERMINED NEPA ANALYSES

FINDING: The Army went to unusual lengths to avoid completing an 

Environmental Impact Statement after its own experts 

recommended such an analysis was necessary, in violation of NEPA. 

The Army pulled its primary WOTUS staffer off the rule entirely and 

retaliated against him after he recommended to conduct the 

analysis.

While the Corps traditionally prepares NEPA analyses for its rulemakings, Chip Smith of 

the Army prepared the first NEPA analysis for the WOTUS rule because the Corps’ regulatory 

staff were busy trying to meet the demand of the rule’s timeline.415 The assignment reflects 

Smith’s knowledge and expertise of NEPA. In particular, his background includes reviewing 

hundreds of environmental assessments.416 Smith summarized his NEPA experience when he 

testified to the Committee in a transcribed interview. He stated:

I’ve reviewed over 500 [NEPA-related documents] and I’ve written frankly, 

I can’t tell you an exact number . . . but several dozen environmental 

assessments and several environmental impact statements.417

Smith further testified his expertise focuses on rulemaking pertaining to wetlands, such as 

WOTUS.418

Smith’s involvement with WOTUS started in February 2009, when the Corps began 

meeting with the EPA Administrator and other top level EPA staff to discuss the rulemaking.419 

Smith continued on as the primary Army regulatory liaison to the Corps, working through 2014 

to prepare the EA for the final rule, which had previously anticipated a FONSI based on the 

substance of proposed rule.420

Around early 2015, though, “last minute” modifications greatly “changed the dynamics”

of the rule by significantly shrinking the EPA’s jurisdiction over certain wetlands and water 

bodies.421 Such substantial revisions to the rule unsurprisingly rendered Smith’s work on the EA 

inconsistent with the new draft.422 The changes to the rule caused it to significantly impact the 

human environment and thus require preparation of an EIS under NEPA. Smith testified:

But I had enough information about what the final rule was going to be 

look[ing] like to know that a couple of key changes in my professional 

 

415 Moyer Tr. at 115-116 (Dec. 17, 2015). 

416 Smith Tr. at 10 (Jan. 21, 2016).

417 Id. at 10.

418 Id. at 13.

419 Id. at 11-12.

420 Id. at 74.

421 Id. at 73-74.

422 Id.
117

opinion resulted in an adverse effect to the quality of the human 

environment, which is the threshold [for an EIS], and that is basically 

eliminating jurisdiction over tens of thousands, possibly hundreds of 

thousands of acres of wetlands and waters we currently had jurisdiction 

over. And that is a threshold, at least in my opinion, for stepping back, 

studying it, and doing an environmental impact statement, and those were 

just last minute changes that were made.423 

Smith also testified about the new questions raised by the rule changes, and the process that 

needed to be followed for a proper EIS. He stated:

Well, at that point, we had questions about the impacts on reservation 

communities, EJ communities, water quality, where jurisdiction would be 

lost. We had questions about the acres and what parts of the country would 

be most affected. We needed to do, well, I felt like we needed to do field 

work, mapping analysis, and working more closely with States and tribes 

and ask them, what—how might these—how might this proposal affect 

your community? And because of the uncertainty and because of the lost 

jurisdiction, the quantity of waters and wetlands that we would no longer 

regulate, I felt that was an adverse effect that met the threshold under NEPA 

where we had to do an EIS.424

Smith also testified to the importance of conducting an EIS. He stated:

Q Was it also discussed as to whether an [Environmental Impact 

Statement] or not doing an [Environmental Impact Statement] 

would affect the substantive portions of the rule or justification for 

the rule? Or was their concern simply timing? 

A My concern was timing and substance. Because when you do an 

EIS, you do robust predecisional public consultation, you do 

scientific studies as necessary, you evaluate data, you consult with 

tribes, and you do a more robust Economic Analysis and collect 

information to inform development of options and alternatives, 

selection of an option, which would be different kinds of rules, and 

then inform the final rule. 

So, in my mind, it was very important because of the uncertainties 

about data, in my view, the lack of the science we needed to support 

all of the aspects of rule, the fact that we did no tribal consultation, 

I thought an environmental impact statement was the correct, under 

NEPA, finding.425

 

423 Id.

424 Id. at 141-142.

425 Smith Tr. at 18-19, (Feb. 19, 2016).
118

Documents show Smith was not the only person who believed an EIS was necessary in 

after the new changes. In an April 27, 2015 memorandum to Assistant Secretary Darcy, Army 

Major General John Peabody forcefully argued for an EIS.426 Specifically, Major General 

Peabody warned that “the Corps would need to prepare an Environmental Impact Statement 

(EIS) to address the significant adverse effects on the human environment that would result from 

the adoption of the rule in its current form.”

427

 Jennifer Moyer, too, recommended an EIS in 

light of the changes.428 She testified:

Q Well, did you make a statement earlier that you felt that an EIS was 

necessary here in order to justify loss of 10 percent CWA 

jurisdiction? 

A I said the type of analysis that would be included in the EIS was 

necessary to sort out what the level of impact was and to make a 

determination of significance. That analysis isn’t included in that 

EA.429

Documents and testimony show that although the EPA is exempt from NEPA, its control 

and influence over the Corps’ NEPA process began early and persisted through the final stages 

of the rule. 430 The extra time needed to complete an EIS clashed with Administrator McCarthy’s 

mandated May 2015 deadline to complete WOTUS. Smith testified: 

Q Were you ever told in any way or feel pressured to avoid the 

completion of an EIS or the recommendation to complete an EIS? 

A We were reminded—“we”—I was reminded by both 

Mr. Schmauder and Mr. Peck in our gang-of-eight meetings that a 

FONSI was expected; it was important that we keep things moving. 

And it was sort of unspoken that a recommendation for an EIS 

would adversely affect the schedule because that would take a 

couple of years.431

By late April 2015, Smith submitted the draft EA recommending an EIS, despite not 

receiving supporting documentation from the EPA. He testified:

Q To your knowledge, did the Corps have any deadlines to produce or 

deliver the EA? 

A I personally had a deadline to get it done before the end of April so 

that the final rule could be promulgated in I believe May was the 

 

426 Memorandum from John W. Peabody, Maj. Gen. U.S. Army, to EPA Asst. Sec. for Civil Works (Apr. 27, 2015).

427 Id.

428 Moyer Tr. at 115-116 (Dec. 17, 2015).

429 Id. at 131-132. (emphasis added)

430 Smith Tr. at 76 (Jan. 21, 2016).

431 Smith Tr. at 18 (Feb. 19, 2016).
119

goal, which I met by turning my draft in on the 27th [of April] to 

obtain guidance on how to proceed. 

Q And who set that timeline or that goal? 

A The Administrator of EPA is what I was told by Craig Schmauder 

and Greg Peck from EPA.432

When Smith submitted his EA, he advised that further work on it required preparation of an EIS 

instead of a FONSI, and sought instruction on how to proceed. He testified: 

So I took my draft [EA] and I turned it in as a courtesy and said I can only 

take it so far because I’m still waiting for some key EPA documents, but 

based on what the rule says, in my opinion, there will be an adverse effect 

on the quality of the human environment. We’ve met the threshold for an 

EIS. What would you like me to do?433 

Following his recommendation of an EIS, Smith was promptly removed from all work on 

WOTUS and his work on the EA was disregarded.434 He testified:

I was prepared to finish the environmental assessment, but I was told that, 

since my answer was not what the Administrator of EPA wanted, I would 

not be allowed to finish it.435

Smith testified about being removed from the WOTUS team. He stated:

Q We previously spoke about your change in duties during the course 

of the rulemaking, specifically that Ms. Darcy removed you from 

working on the rule and clean water issues. You mentioned that part 

of her reasoning for your removal was your recommendation of an 

EIS instead of a FONSI. How did Ms. Darcy communicate this 

specific justification to you? 

A She told me in a face-to-face meeting in July—the date escapes me. 

Maybe it was early August. It might be in my earlier testimony. It 

was the second face-to-face I had—that she was disappointed in my 

recommendation and she had lost confidence in my ability to 

support her position on the rule and that the rest of my portfolio 

would remain the same but I would not work on the rule or its 

implementation. 

 

432 Id. at 13.

433 Smith Tr. at 74 (Jan. 21, 2016).

434 Schmauder Tr. at 171 (Feb. 17, 2016).

435 Smith Tr. at 7-8 (Feb. 19, 2016).
120

Q You also said that part of her reasoning was because you raised 

issues of science and economics in the run-up to promulgation of the 

final rule. What gave you that impression? 

A The four times we were given the opportunity to brief the Assistant 

Secretary, we would bring up issues and we would not receive 

guidance or follow-on support to have the issues addressed. And we 

would hear primarily, though, from Mr. Schmauder, who would say 

that he and EPA had discussed the issues and made the decisions 

and we need not worry further about our science or economic 

concerns.436

Testimony shows that Smith’s removal from the NEPA process after recommending an 

EIS arose from the fact that it was predetermined that a FONSI was needed—in spite of the 

science, facts, and law to the contrary—to expedite the rulemaking and not interfere with 

Administrator McCarthy’s hard deadline. The fact that the decision to issue a FONSI was 

predetermined is reflected in Craig Schmauder’s testimony to the Committee. Schmauder stated:

Q Do you know why Mr. Smith was not asked to draft the second EA? 

If it was a matter of timing of Mr. Smith not finishing his analysis 

by a certain date, why wasn’t he given more time? 

A It was not my understanding that he said he needed more time. It 

was my understanding that he said that he no longer could support 

an EA to support this rulemaking. 

Q So, by “this rulemaking,” you mean he was no longer able to support 

making an EA FONSI. Is that correct? 

A Completing an EA that would lead to a FONSI, probably yes. 

Q Was that decision to have an EA FONSI drafted predetermined 

based on the rule? 

A The proposed rule went out and said that the proposed rule said that 

we believed that the rule changes would be supported by an EA 

FONSI in the proposed rule.437

Smith testified that Schmauder expected that the result of Smith’s work would be a 

FONSI, despite Smith’s insistence that the process was not pre-determined. Smith stated: 

Q You mentioned when you were last here that Mr. Schmauder 

referred to the EA as the EA FONSI. Is that correct? 

 

436 Id. at 19-21.

437 Schmauder Tr. at 146-147 (Feb. 17, 2016).
121

A Correct.

Q Did he ever respond as to why he was using that terminology? 

A I would correct him at every chance I got in meetings, and he would 

simply say, “It’s my expectation this will result in a FONSI.”

438

The decision to fix the outcome of the NEPA analysis not only constituted an effort by 

EPA and top Army Civil Works officials to ignore the science and facts, but also violated NEPA. 

Smith stated: 

Rather than get wrapped up on the controversial statement by Mr. 

Schmauder, under the law, the National Environmental Policy Act, you do 

not pre-decide the outcome of a FONSI or an EIS. You do your 

environmental assessment, and, based on your assessment, you can make 

the choice. So it would not be correct, in accordance with the law and 

regulations, to predetermine an outcome to an environmental assessment.439

But that is what the agencies did. In fact, in an amendment to his transcribed interview 

testimony,440 Laity recalls that Administrator Shelanski discussed making sure that last-minute 

changes to the rule would comport with a FONSI in a high-level call with White House officials:

Q Did you become aware at any point in the rulemaking that the Army had 

changed its determination from an environmental assessment finding that there 

may be a significant impact to a finding of no significant impact? 

A No, I wasn't aware of that. I was aware -- I mentioned to you the discussion that 

we had late in the rulemaking process about the 4,000-foot bright line and the 

Army's concern that that might cut out waters that they felt had traditionally 

considered jurisdictional. And I believe I remember as part of that discussion 

that the question came up of, if that were left the way it was, that that might 

cause the Army to have a concern about its finding of no significant impact.

And I don't know if the decision to change that was made above my level and I 

don't know what factors went into that or what the Army's view was after 

that. But I do know that that was changed in the way that the Army was 

requesting so that waters beyond the 4,000-foot level -- 4,000-foot limit -- if 

they were in a 100-year floodplain, which can be very big, it can be way more 

than 4,000 feet for large rivers, that those could potentially be included subject 

to a case-by-case determination.

 

438 Smith Tr. at 9-10 (Feb. 19, 2016).

439 Id. at 9.

440 Letter from Tamara Fucile, Office of Management and Budget, to Hon. Jason Chaffetz, Chairman, H. Comm. on 

Oversight & Gov’t Reform (Apr. 28, 2016) transmitting “Addendum to March 8, 2016 Transcribed Interview of Jim 

Laity” (Apr. 27, 2016).
122

So I was not aware that there was any further concern after that decision was

made.

Q So when you say that was made above your level, do you mean within OIRA 

and OMB or do you mean within the agencies? 

A I don't know exactly where that decision was made, but I know that it was 

discussed within the agencies and within the EOP. 

Q And how did you find out that that was being discussed within the EOP? 

A I was invited to sit in on a phone call among some senior officials in which it 

was discussed. And at that time, I don't recall where the decision was made. I 

was not -- I was an observer on the phone call. My boss, Howard Shelanski, 

was speaking for OIRA. But I was there, kind of like as his adviser. And 

shortly after that phone call the decision was made to make that change, but I 

don't know who made it or exactly the dynamics of how that happened. 

Q Do you recall who else was on that call? 

A Christy Goldfuss, I believe was on the call, she's the head of CEQ. And I 

believe Brian Deese was on the call. He's a senior adviser in the chief of staff's 

office, I think. I'm not actually sure what his title is. I cannot remember -- I 

have feeling that there were two or three other people at senior levels on the call, 

but I can't remember who they.

Q Was anybody from the agencies present on that call? 

A No.

Q Do you recall whether you discussed anything besides the finding of no 

significant impact and adjacency limits? 

A Just to be clear, we did not discuss the finding of no significant impact. That 

didn't come up at all on the call. What came up was the issue of whether the 

requirement in the rule would be changed so that waters outside of the 

4,000-foot limit could still be considered jurisdictional if they were within the 

100-year floodplain.441

Laity later changed his answer, stating “. . . the call was about whether to modify the 

draft limit to allow a case-specific jurisdictional determination for waters beyond 4,000 feet that 

were still within the 100-year floodplain of a navigable water. I now recall, however, that one of 

the points in favor of making this modification was that the Corps believed it would be 

more consistent with their FONSI. The final rule did include this modification, consistent 

with the Corps’ FONSI.” This shows that OIRA and the White House worked to shape 

 

441 Laity Tr. at 110-112 (Mar. 8, 2016).
123

changes to the rule to fit a pre-determined FONSI instead of requiring the agencies to pursue 

additional analysis and a proper NEPA analysis based on the last-minute changes.

B. THE FINAL EA WAS PRODUCED BY STAFF WITH NO WOTUS EXPERIENCE

After Smith was removed from the NEPA process, responsibility for drafting the EA was 

assigned to Gib Owen, a Corps planner with no prior experience working on WOTUS.442 

Regarding Owen’s WOTUS experience, Smith testified:

Q We understand that Gib Owen, a gentleman who had no prior 

experience with the [WOTUS] rulemaking, was then brought on to 

complete the second EA. Is that correct? 

A Correct.443

According to Schmauder, Owen did not rely on the previous work from Smith, but 

instead, “essentially started from scratch.”

444

 In accordance with the EPA’s expectations, and 

those of Assistant Secretary Darcy and Craig Schmauder, Owen’s EA recommended a FONSI, 

which Darcy thereafter adopted.445

Testimony shows Owen assuming responsibility for drafting the EA raised several 

problems. First, neither Smith nor Moyer ever worked with Owen on any prior EA,446 and 

neither one of them were familiar with his background, experience, or expertise with NEPA 

analysis.447 Smith testified he would not have recommended Owen as “qualified” to complete a 

NEPA analysis. He stated:

Q Would you have included Mr. Owen on your list of 

recommendations to Mr. Lee of qualified regulators to complete the 

NEPA analysis? 

A No. He’s a planner with no regulatory experience, to my 

knowledge.448

In fact, soon after assuming responsibility for the EA, Owen began asking questions of 

such an elementary nature that it indicated a lack of requisite knowledge and background to 

undertake the complicated regulatory endeavor of drafting an EA.449 Moyer found the 

rudimentary nature of Owen’s questions “interesting.” She testified:

 

442 Id. at 15-16.

443 Id. at 11.

444 Schmauder Tr. at 171 (Feb. 17, 2016).

445 Moyer Tr. at 131 (Dec. 17, 2015).

446 Smith Tr. at 11 (Feb. 19, 2016).

447 Moyer Tr. at 118 (Dec. 17, 2015).

448 Smith Tr. at 15-16 (Feb. 19, 2016).

449 Moyer Tr. at 117-118 (Dec. 17, 2015).
124

A All I know is that I answered a few questions for Mr. Owen. But I 

did not provide him a lot of information. I don’t know what he had 

available to him other than a few questions that I answered by email 

for him. 

Q Okay. Do you remember what those questions were? 

A I provided definitions of what an approved jurisdictional 

determination was, what a preliminary jurisdictional determination 

was 

Q Can you keep your voice up?

A Sure. And some information on the numbers of jurisdictional 

determinations of each type that we do. And some basic regulatory 

program information.

Q This basic regulatory program information and some of the 

definitions that you were just saying, are those things that your 

regulatory staff would typically know? 

A Yes.

Q So isn’t in your opinion, is it a little questionable as to why they 

would be putting somebody in charge of writing the environmental 

assessment who doesn’t know what these basic regulatory terms 

mean? 

A It was interesting to me that those were the types of questions I was 

answering.450

Moreover, although Owen had no prior experience with WOTUS before this assignment, 

he completed his EA in only one or two weeks.451 This was unheard of, according to Smith.

452

 

Smith told the Committee that an EA usually takes as few as three to four months, or as long as 

several years.453 According to Smith, for a rulemaking as complex, time-consuming, and 

significant as WOTUS, an EA taking over a year would be reasonable.454

The agencies sent the final WOTUS rule to OIRA to initiate final review before 

completing the NEPA analysis.

455

 Specifically, the final rule was submitted to OIRA on April 6, 

 

450 Id.

451 Smith Tr. at 12 (Feb. 19, 2016).

452 Id. at 12.

453 Id. at 12-13.

454 Id. at 13.

455 Id. at 11-12.
125

2015, weeks before Owen assumed responsibility for drafting the EA that was originally due to 

be completed by April 27, 2015.456 Smith testified:

Q We understand that you were supposed to deliver or submit your EA 

around April 27, 2015, and that Mr. Owen was brought on after that 

date. Is that your understanding? 

A That’s correct.

Q The rule was submitted to OMB for interagency review on April 6, 

2015. Can you explain why it was submitted to OMB before the EA 

was completed? 

A I can’t explain it.

Q Is that typical procedure in a rulemaking? 

A No.

In fact, as late as May 13, 2015, Schmauder was sending OIRA officials “the current 

draft” EA with EPA input.457 According to Smith’s testimony, submitting the EA well after the 

final rule was not only atypical rulemaking procedure, but also emphasized the insufficient 

manner in which the rule was finalized and rushed out.458

The Economic Analysis of the WOTUS Rule Was Flawed

Documents show that EPA worked to ensure the WOTUS rule was not found to be 

economically significant. Under Executive Order 13563, President Obama reaffirmed Executive 

Order 12866, and continued requiring federal agencies to “propose or adopt a regulation only 

upon a reasoned determination that its benefits justify its costs (recognizing that some benefits 

and costs are difficult to quantify).”

459

 Under Executive Order 12866, a “cost-benefit analysis”

or “Economic Analysis,” as federal agencies may call it, is triggered by a significant regulatory 

action which may “have an annual effect on the economy of $100 million or more or adversely 

affect in a material way the economy, a sector of the economy, productivity, competition, jobs, 

 

456 Id. at 11-12.

457 Email from Craig Schmauder, Army, to Vlad Dorjets, OIRA, and Greg Peck, EPA, (May 13, 2015, 07:03 p.m.) 

(OMB-026752).

458 Smith Tr. at 11-12 (Feb. 19, 2016).

459 Exec. Order No. 13,563, 76 Fed. Reg. 3821 (Jan. 21, 2011). As noted in the order this supplements and reaffirms 

Exec. Order No. 12,866, “Regulatory Planning and Review,” which was referenced by several individuals 

throughout the Committee’s investigation. Please note this concept originated under the Reagan Administration in 

1981 for further information please see Caroline Cecot & W. Kip Viscusi, Judicial Review of Agency Benefit-Cost 

Analysis, 22 Geo. Mason L. Rev. 575 (2015), available at 

http://masonlec.org/site/rte_uploads/files/Manne/Readings/Administraiton%20Unbound/Cecot%20%26%20Viscusi

_Second%20Round.pdf. 
126

the environmental, public health or safety, or State, local, or tribal governments or 

communities.”

460

A. THE EPA PUSHED BACK AGAINST THE APPROPRIATE SIGNIFICANCE 

DETERMINATION

As development of the WOTUS proposed rule was underway, there was considerable 

email traffic and internal communications regarding the significance designation and how the 

WOTUS rule should be characterized for purposes of analysis. Jim Laity explained to the Greg 

Peck that the rule was economically significant based on the EPA’s own Economic Analysis. He 

explained further that because the guidance was listed as “economically significant,” “it may 

raise eyebrows if the rule is not similarly characterized.”461

Administrator McCarthy and the EPA had serious reservations about this designation. 

Laity explained to OIRA Administration Shelanski right before the proposed rule’s issuance why 

the designation was unavoidable, citing “[t]hese [costs] are well within the kinds of costs that are 

appropriate to analyze and be transparent under the EOs.”462

 

460 Exec. Order No. 12,866 § 3(f)(1), 58 Fed. Reg. 51,735 (Oct. 4, 1993), available at

https://www.whitehouse.gov/sites/default/files/omb/inforeg/eo12866/eo12866_10041993.pdf. 

461 Email from Jim Laity, OIRA, to Gregory Peck, EPA, (Sept. 17, 2013, 03:35 p.m.) (OMB-006816).

462 Email from Jim Laity, OIRA, to Howard Shelanski, OIRA (Nov. 7, 2013, 10:04 a.m.) (OMB-041462-3).
127

Documents show Administrator McCarthy was concerned about classifying the rule as 

economically significant and she pressed OIRA on what she believed was an improper 

classification for the rule. On November 7, 2013, Administrator Shelanski wanted to put 

together a “brief” to convince McCarthy that the economically significant designation was 

proper.463 He also wrote: “Gina is very worked up about this.”

464

Documents show OIRA assumed early that the EPA’s failure to list the rule as 

economically significant was an error given the high cost of the rule.465

 

463 Email from Gina McCarthy, EPA, to Howard Shelanski, OIRA (Nov. 7, 2013, 04:07 p.m.) (OMB-041464); see 

also Email from Howard Shelanski, OIRA, to Andrei Greenawalt, OIRA, and Dominic Mancini, OIRA (Nov. 7, 

2013, 04:24 p.m.) (OMB-041464).

464 Id.

465 Email from Jim Laity, OIRA, to Howard Shelanski, OIRA (Nov. 7, 2013, 07:05 p.m.) (OMB-041465).
128

The Committee obtained an internal memorandum to OIRA Administrator Shelanski

stating that the debate between “indirect” and “direct” costs was irrelevant for purposes of the 

significance determination, given the rule’s high cost.466 

 

466 Memo attached to Email from Jim Laity, OIRA, to Howard Shelanski, OIRA (Nov. 7, 2013, 07:05 p.m.) (OMB041467).
129

Documents show the debate over indirect versus direct costs became an important 

sticking point in the creation of the rule. The agencies argued throughout the WOTUS 

rulemaking that they were not beholden to certain requirements, including those in the Small 

Business Regulatory Enforcement Fairness Act (SBREFA), because the WOTUS rulemaking 

was merely a definitional rule requiring legal interpretation, and not a traditional rulemaking. 

Therefore, the agencies argued, the rule would not impose additional direct cost. CEQ explained 

how the Department of Justice previously made the argument with respect to the Greenhouse 

Gas rulemaking. An email from Manisha Patel at CEQ to Jim Laity on November 4, 2013

stated:

I wanted to share with you that I heard the SBA might be raising again the 

question of whether the WOTUS rulemaking would require a Small 

Business Advocacy Review Panel under the Regulatory Flexibility Act. In 

the interest of a smooth and efficient interagency review, I’d like to provide 

some institutional memory on the subject for our newer CEQ folks.

I remember that this same question was raised with respect to the WOTUS 

rulemaking awhile back. Those that were here at that time might recall that 

CEQ hosted a meeting among EPA, SBA, DOJ and OMB on this topic 

because DOJ was preparing to file a brief in the GHG litigation asserting 
130

the US Government’s position that rulemakings that established definitions 

or scope (such as the tailoring rule or the WOTUS rule) did not have 

significant economic impact on a substantial number of small entities 

(SISNOSE) because such rules do not impose any direct regulatory 

requirements. I believe the brief articulating that legal position was filed, 

though the DC Circuit didn’t take up the issue.467

This interpretation gives agencies a method for disposing of policies, as outlined in SBREFA,

created to protect especially vulnerable stakeholders—small businesses—from overly 

burdensome and overreaching regulation, and which promote thoughtful and effective 

implementation of the law.

Documents show that once the EPA conceded that the rule was, in fact, major, it still 

fought to construe all costs of the rule as “indirect,” even within two weeks of the rule’s release, 

despite the so-called “battle” the agencies had already undergone on the issue. Dorjets wrote: 

“Greg [Peck] is now proposing to say the rule is major but that all costs are indirect. I don’t see 

us reopening that battle of whether costs are direct or not so this seem acceptable. Do you 

agree?”

468

 

B. THE EPA USED INCONSISTENT BASELINES, MISUSED THE TERM “INDIRECT 

COSTS,” AND UTILIZED AN INAPPROPRIATE BENEFITS TRANSFER TECHNIQUE

Documents show the Corps had concerns the Economic Analysis relied on outdated data 

and had not been revised based on new changes in 2014.

469

 

467 Email from Manisha Patel, CEQ, to Jim Laity, OIRA, et al., (Nov. 4, 2013, 1:33 p.m.) (OMB-051157) 

(unredacted version on file with U.S. Dept. of Justice).

468 Email from Vlad Dorjets, OIRA, to Jim Laity, OIRA (May 15, 2015, 12:00 p.m.) (OMB-027030).

469 Memo attached to Email from Charles Smith, Army Corps, to Jim Laity, OIRA (Jan. 23, 2015, 12:49 p.m.) 

(OMB-046648).
131

As the rule progressed through the notice and comment period, in January 2015, the 

Corps again raised concerns with the Economic Analysis.

470

In developing an Economic Analysis, OMB Circular A-4 denotes the importance of 

identifying a baseline: “benefits and costs are defined in comparison with a clearly stated 

alternative.471 This normally will be a ‘no action’ baseline: what the world would be like if the 

proposed rule is not adopted.”

472

 

The Small Business Administration (SBA’s) Office of Advocacy noted in its comment 

letter on the regulation that it appeared an incorrect baseline was used for the Economic 

Analysis.

473

 

470 Memo with Army Corps comments attached to Email from Craig Schmauder, Army Corps, to Gregory Peck, 

EPA, and Jim Laity, OIRA (Feb. 21, 2014, 04:28 P.M. EST) (OMB-045176).

471 https://www.whitehouse.gov/sites/default/files/omb/assets/regulatory_matters_pdf/a-4.pdf; see also OIRA, Office 

OF MGMT. & BUDGET, EXECUTIVE OFFICE OF THE PRESIDENT, REGULATORY IMPACT ANALYSIS: FREQUENTLY 

ASKED QUESTIONS (FAQS) (2011), available at

https://www.whitehouse.gov/sites/default/files/omb/assets/OMB/circulars/a004/a-4_FAQ.pdf. 

472 OFFICE OF MGMT. & BUDGET, EXECUTIVE OFFICE OF THE PRESIDENT, CIRCULAR A-4 2 (2003), available at 

https://www.whitehouse.gov/sites/default/files/omb/assets/regulatory_matters_pdf/a-4.pdf.

473 WINSLOW SARGEANT, CHIEF COUNSEL, OFFICE OF ADVOCACY, SBA, COMMENT LETTER ON THE PROPOSED 

DEFINITION OF “WATERS OF THE UNITED STATES” UNDER THE CLEAN WATER ACT 5 (Oct. 1, 2014), available at 

https://www.sba.gov/advocacy/1012014-definition-waters-united-states-under-clean-water-act.
132

Further, prior to issuance of the final rule, OIRA’s Vlad Dorjets acknowledged the 

“dubious” nature of the EPA’s indirect cost language and incorrect baseline.

474

Committee staff asked Laity about EPA’s inconsistent statements regarding change in 

jurisdiction under WOTUS. He testified: 

Q Do you know why the EPA changed its methodology from using the 

existing regulation, which resulted in narrowing the jurisdiction, 

 

474 Email from Vlad Dorjets, OIRA, to Dominic Mancini, OIRA, and Howard Shelanski, OIRA (Apr. 29, 2015, 

08:58 a.m.) (OMB-034284).
133

whereas the Economic Analysis uses current practice and results in 

a 3 percent increase of jurisdiction?

A It is my observation that the agency was not consistent in how they 

presented which baseline in different contexts, and I don’t have any 

opinion about that or any comment about that. I am not responsible 

for statements that the agency makes to the public.475 

Laity also testified to the Committee that in his 20 years with OIRA, he could not recall 

any other rulemaking where an agency had used different baselines. He stated: 

Q Have you experienced other rulemakings where agencies have 

employed different baselines for different analyses? 

A Not that I can think of right now.476

CEQ also had concerns with the baseline. CEQ’s Katie Renshaw communicated those concerns 

to Vlad Dorjets in an email on May 8, 2015.477

 

475 Laity Tr. at 86 (Mar. 8, 2016).

476 Id. at 143.

477 Email from Katie Renshaw, CEQ, to Vlad Dorjets, OIRA, (May 8, 2015, 6:07 p.m.).
134

Another method for conducting economic analysis is through benefit-transfer. OMB’s 

own guidance cautions against its use. The guidance states:

[A]lthough benefit-transfer can provide a quick, low-cost approach for 

obtaining desired monetary values, the methods are often associated with 

uncertainties and potential biases of unknown magnitude. It should 

therefore be treated as a last-resort option and not used without explicit 

justification.478

According to OIRA, the EPA utilized the benefit-transfer method incorrectly and misused 

the term “indirect” costs, which yielded incorrect results from the analysis. Amanda Thomas, 

the OIRA economist charged with reviewing the Economic Analysis, emailed Vlad Dorjets on 

May 5, 2015: “I’m not sure I would agree with EPA’s approach to benefit transfer of 

benefits.”

479

In a May 14, 2015 email, Thomas stated that the EPA used the term “indirect costs”

inappropriately, acknowledging the term had been “contentious” in the WOTUS rulemaking.480 

She also states that the EPA’s extrapolation of study results is “very questionable” and does “not 

 

478 OFFICE OF MGMT. & BUDGET, EXECUTIVE OFFICE OF THE PRESIDENT, CIRCULAR A-4 24 (2003), available at 

https://www.whitehouse.gov/sites/default/files/omb/assets/regulatory_matters_pdf/a-4.pdf. 

479 Email from Amanda Thomas, OIRA, to Vlad Dorjets, and Jim Laity, OIRA (May 5, 2015, 6:59 p.m.) (OMB034287).

480 Email from Jim Laity, OIRA, to Amanda Thomas, OIRA, and Vlad Dorjets, OIRA (May 15, 2015, 6:32 p.m.) 

(OMB-027011).
135

meet the requirements” of OMB Circular A4. Laity acknowledged her concerns, but noted 

“[t]hese are good issues but unlikely we will make progress on either of them.”

481

 

When questioned about inconsistencies in the use of jurisdictional determinations, 

Jennifer Moyer testified that she could not explain why the jurisdictional determinations used in 

the rule were not those utilized in the Economic Analysis:

Q Can you explain what the case specific jurisdictional 

determinations, what were they? 

A The ones that were discussed associated with the Economic 

Analysis were associated with isolated waters JDs. And the Corps 

looked at a body of them. And EPA looked at a body of JDs. And 

the conclusions that appear to be drawn in the preamble aren’t really 

 

481 Id.
136

associated with the JDs that were looked at associated with the 

Economic Analysis. 

Q Okay. So what was looked at for the Economic Analysis

specifically are not the same as what you would see in the preamble. 

A Right. 

Q Okay. Okay.

 

Q Do you know why the EPA used a different set of JDs in the 

preamble? 

A No.482

C. THE ECONOMIC ANALYSIS WAS NOT PROVIDED ALONG WITH THE FINAL RULE 

FOR REVIEW

Documents show the EPA did not provide OIRA the Economic Analysis along with the 

final rule for review because it had not yet finalized the analysis. Because of the rushed timeline, 

however, OIRA sent the final rule out for interagency review without the supporting 

documentation. EPA’s Gregory Peck acknowledged the problem in an email to Vlad Dorjets on 

April 7, 2015. Peck stated: “[U]nsurprisingly, [the agencies] are already starting to ask about 

when the Economic Analysis (RIA?) will be made available . . . .”

483

 

482 Moyer Tr. at 40-41 (Dec. 17, 2015).

483 Email from Gregory Peck, EPA, to Vlad Dorjets, OIRA (Apr. 7, 2015, 03:25 p.m.) (OMB-039142); see also

Email from Vlad Dorjets, OIRA, to Gregory Peck, EPA (Apr. 7, 2015, 02:05 p.m.) (OMB-039142).
137

Documents show it was not until April 27, 2015—only one month before the rule was

released—that EPA provided OIRA with its final Economic Analysis for the rule.

484

 

484 Email from Nicole Owens, EPA, to Vlad Dorjets, and Jim Laity, OIRA (Apr. 27, 2015, 06:00 p.m.) (OMB039144).
138

The EPA Failed to Comply with the Regulatory Flexibility Act

FINDING: Disagreement over the EPA’s interpretation of the costs of the rule 

and its impact on small businesses continued throughout the 

rulemaking. OIRA and the EPA intentionally avoided compliance 

with the Regulatory Flexibility Act (RFA) and Small Business 

Regulatory Enforcement Fairness Act (SBREFA). The agencies 

construed the rulemaking as “definitional” to avoid its obligations 

under the RFA, altogether.

Under the Regulatory Flexibility Act (RFA), when an agency undertakes a rulemaking 

the agency must conduct analysis to determine whether the rule will have a significant impact on 

small entities.485 The RFA provides agencies discretion to certify “that the rule will not, if 

promulgated, have a significant economic impact on a substantial number of small entities.”

486

 

The agency is required to provide a justification for its certification to the Chief Counsel of the 

Small Business Administration (SBA) Office of Advocacy (Advocacy).

487

 

While all agencies have this RFA requirement, the EPA has more stringent standards and 

must conduct additional small entity analysis and convene a small business advocacy review 

(SBAR) panel488 under SBREFA unless it makes such certification.

489

 . The Chief Counsel for 

Advocacy may waive the SBAR panel requirement based on the agency’s consideration of the 

concerns collected from small entities.490 

Documents and testimony show that in this case, the EPA not only ignored 

comprehensive evidence suggesting the WOTUS rule would, in fact, have a significant impact

on small businesses, but deliberately engaged in an accommodation with OIRA to avoid its 

obligation to conduct a regulatory flexibility analysis and on-the-record hearings about the rule’s 

impact on small entities.

The EPA’s justification for certifying that the rule would not have a significant economic 

impact on a substantial number of small entities was stated in response to questions from the 

Senate Committee on Environment and Public Works. The justification was based on the notion 

that the “action will not affect small entities to a greater degree than the existing regulations.”

491

 

485 5 U.S.C. §§ 601-12.

486 5 U.S.C. § 605(b).

487 Id.

488 5 U.S.C. § 609(b).

489 Small Business Regulatory Enforcement Fairness Act, Pub. L. No. 104-121, §§ 201- 224, 110 Stat. 857 (as 

amended by Pub. L. No. 110-28, § 8302, 121 Stat. 205) (1996). 

490 5 U.S.C. § 609(e).

491 Oversight of the Army Corps of Engineers’ Participation in the Development of the New Regulatory Definition of 

“Waters of the United States” Before the Subcomm. on Fisheries, Water, and Wildlife of the S. Comm. on 

Environment and Public Works, 114th Cong. 129-130 (2015) (Responses by Jo-Ellen Darcy, U.S. Assistant 

Secretary to the Army, to additional questions by Senator Rounds).
139

When EPA made its certification, Cass Sunstein served as Administrator of OIRA. 

According to testimony during transcribed interviews with OIRA officials, Administrator 

Sunstein accepted the initial EPA certification despite internal concerns that it might be 

inappropriate. Laity testified:

Q So considering the Office of Advocacy in this case did say that the 

agency improperly certified the rule, that in and of itself did not rise 

to the level of you questioning the EPA certification? 

A I personally—and again I’m not speaking for OIRA—I personally 

did have some questions about the agency certification.

Q And when you say you’re making that statements on your personal 

behalf, why are you not making it in your capacity as an OIRA 

staffer engaged in review of that rule at the time? 

A I guess I’m being particularly careful here because I don’t speak for 

OIRA, the political leadership of OIRA speaks for OIRA. And the 

political leadership of OIRA was comfortable with and accepted—

after internal discussions accepted the agency’s determination that 
140

it was appropriate to certify. It was largely a legal determination 

that turned on this discussion of what is a direct and indirect effect 

and what is the appropriate baseline. And ultimately I’m not a 

lawyer and I’m not an RFA specialist, so that decision was made 

appropriately within OIRA at the appropriate level. 

Q Do you recall who engaged in those discussions? 

A I believe that the—I don’t remember the details of the discussions, 

but it was Cass Sunstein who made the decision that OIRA was 

comfortable with the agencies certifying the rule.492

Laity testified that he had concerns about the EPA’s certification. He stated:

I did have questions about how the agency had chosen to make the 

certification determination, but I discussed those questions internally with 

the agency and then internally in OIRA. As I just explained to you, the 

process, as I see it, my policy level decisionmaker, Cass Sunstein, made a 

decision, and I had no reason to question that decision. He’s a lawyer.493 

Advocacy’s Chief Counsel, Winslow Sargeant, opposed the certification.494 In a

comment letter on the proposed rule, he argued that (1) the agencies used an incorrect baseline 

for determining their obligations under the RFA; (2) the rule imposes direct costs on small 

businesses; and (3) the agencies improperly certified the rule because it will have a significant 

economic impact on small businesses.495 

Documents show the Advocacy staff expressly informed OIRA of their concerns 

regarding the WOTUS rule prior to its issuance.496 As early as March 2012, OIRA officials were 

aware of Advocacy’s concerns. Noting in an internal memo that the SBAR panel process 

“would require a significant resource commitment” and “could extend the rulemaking schedule 

by several months,” OIRA staff wrote:

Regulatory Flexibility Act Compliance: The preamble states that the 

proposed rule will not have a significant impact on a substantial number of 

small entities (SISNOE) because it does not “directly” regulate any small 

 

492 Laity Tr. at 120-121 (Mar. 8, 2016).

493 Laity Tr. at 138 (Mar. 8, 2016).

494 WINSLOW SARGEANT, CHIEF COUNSEL, OFFICE OF ADVOCACY, SBA, COMMENT LETTER ON THE PROPOSED 

DEFINITION OF “WATERS OF THE UNITED STATES” UNDER THE CLEAN WATER ACT 4 (Oct. 1, 2014), available at 

https://www.sba.gov/advocacy/1012014-definition-waters-united-states-under-clean-water-act. 

495 WINSLOW SARGEANT, CHIEF COUNSEL, OFFICE OF ADVOCACY, SBA, COMMENT LETTER ON THE PROPOSED 

DEFINITION OF “WATERS OF THE UNITED STATES” UNDER THE CLEAN WATER ACT 4 (Oct. 1, 2014), available at 

https://www.sba.gov/advocacy/1012014-definition-waters-united-states-under-clean-water-act. 

496 Environment and Natural Resources Division, OIRA, Comments on the Feb. 17, 2012, Draft Guidance on 

Identifying Waters Protected by the Clean Water Act (Mar. 14, 2012) (OMB-051121) (unredacted version on file 

with U.S. Dept. of Justice). See also Email from Kia Dennis, SBA, to Jim Laity, OIRA (Sept. 23, 2013, 02:57 p.m.) 

(OMB-041198). See also Email from Winslow Sargent, SBA to Chris Lu, (Mar. 2, 2012, 01:06 p.m.) (OMB041294).
141

entity (or anybody else). Rather it simple (sic) clarifies the extent of Clean 

Water Act jurisdiction. SBA does not agree. They believe the rule expands 

jurisdiction relative to the status quo (as reflected in the Economic Analysis

accompanying the rule) and that small entities discharging into newly 

jurisdictional waters will experience a “direct” regulatory impact that at 

least requires substantive analysis under the RFA to determine if it is 

significant. The determination of “direct” v. “indirect” effects is a 

longstanding point of contention between SBA and EPA, and OIRA staff 

has generally supported SBA in reading the RFA more broadly. However, 

the current case is particularly challenging because it is difficult to identify 

any specific water body that would fail a case-by-case jurisdictional 

determination under the existing status quo, but would be made 

jurisdictional by the rule. As noted above, one of the main advantages (and 

purposes) of the rule is that it clears up substantial ambiguity regarding 

jurisdiction, but this very fact makes it hard to determine if the rule has a 

SISNOSE or not. OIRA staff recommends that counsel from EPA, the 

Corps, SBA, and the EOP discuss the issue and try to reach consensus on 

whether or not the rule requires substantive analysis under the RFA. If it 

does, the agencies will need to analyze the impacts of the rule on small 

entities, and if they cannot determine that there is no SISNOSE, will need 

to conduct a Panel process pursuant to the Small Business Regulatory 

Enforcement and Fairness Act. This could be done concurrently with the 

public comment period and the agencies consideration of public comments, 

but it would require a significant resource commitment that is not currently 

planned, and could extend the rulemaking schedule by several months.497

Documents also show Advocacy staff continued to communicate their concerns directly 

to OIRA through the rulemaking process.498

 

497 OIRA, Waters of the US Outstanding Policy Issues at 5 (Jan. 9, 2014) (OMB-045601).

498 Email from Kia Dennis, SBA, to Jim Laity, OIRA (Sept. 23, 2013, 02:57 p.m.) (OMB-041198).
142

In fact, Advocacy staff continued objecting to the EPA’s certification throughout 

promulgation of the final rule. Prior to the final issuance of the rule in 2015, Advocacy staff 

once again notified OIRA and stated the EPA had failed to respond to their comments 

individually and was required to do so. According to an email from OIRA’s Vlad Dorjets, the 

EPA did not do so because the agency’s position was “the RFA only requires agencies to 

respond to SBA’s comments individually in a Final Regulatory Flexibility Analysis (FRFA)” and 

that provision would not apply “because the Agency is certifying no SISNOSE and not preparing 

a FRFA.”

499

 

499 Email from Vlad Dorjets, OIRA, to Kia Dennis, SBA, (May 15, 2015 07:36 a.m.) (OMB-006175).
143

Documents showed that Advocacy staff disagreed, and took the position that the EPA was in fact 

required to respond to their comments.500

Dorjets was unsure how to handle Advocacy’s objection, especially at this late stage in 

the process—less than two weeks prior to the rule’s release. In an email forwarding Advocacy’s 

concerns to the EPA and the Corps, Dorjets wrote: “Passing along SBA’s response. Not sure I 

want to get in the middle of this but let me know if you think that’s best.”

501

 

Documents and testimony show that a major point of disagreement regarding the EPA’s 

certification centered around direct versus indirect costs. Direct costs are the actual costs of 

complying with a regulatory requirement whereas indirect costs are “ripple effects in the 

economy as a whole that ultimately result from the regulation.”

502 In justifying WOTUS, the 

EPA relied heavily on the notion that the rule’s effects were indirect, though the rule’s summary 

of economic impacts itself concedes that the rule may result in direct costs from other programs 

as a result of implementation.503 It states: 

Entities currently are, and will continue to be, regulated under these 

programs that protect ‘WOTUS’ from pollution and destruction. Each of 

 

500 Email from Kia Dennis, SBA, to Vlad Dorjets, OIRA, (May 15, 2015 08:15 a.m.) (OMB-006175).

501 Id.

502 REFORMING REGULATORY IMPACT ANALYSIS 36 (Winston Harrington, Lisa Heinzerberg, and Richard D. 

Morgenstern eds., 2009).

503 Economic Analysis of the EPA-Army Clean Water Rule, U.S. EPA and U.S. Department of the Army, May 20, 

2015, available at https://www.epa.gov/sites/production/files/2015-06/documents/508-

final_clean_water_rule_economic_analysis_5-20-15.pdf.
144

these programs may subsequently impose direct or indirect costs as a result 

of implementation of their specific regulations.504

Documents show OIRA engaged in internal and high-level talks regarding the EPA’s 

certification. One email from Dominic Mancini to Administrator Shelanksi and Jim Laity stated 

a concern about the EPA’s interpretation of “indirect effects.”

505

In an email to CEQ, Jim Laity explained the EPA’s difference of opinion regarding 

whether the rule directly impacted small entities. According to Laity, “it is clear that a new 

federal water quality standard imposes ‘direct’ effects on small entities because any discharger, 

including small dischargers, must have permit conditions as necessary to ensure that the standard 

is not violated.”

506

 Laity’s email to Manisha Patel at CEQ on November 4, 2013 stated:

If EPA’s argument were only that there is no SISNOSE this would be a 

factual question that could be resolved through analysis and I don’t think it 

would be problematic. The issue is that EPA believes that in determining 

SISNOSE, it is only required to consider “direct” effects. On its face, this 

argument is supported by several court precedents, but the issue is what 

constitutes an “indirect” effect. I believe that courts have clearly established 

upstream and downstream economic effects on non-regulated entities (eg, 

higher prices for inputs) are “indirect” effects and not subject to RFA 

analysis. The more difficult case is when a rule does not mention “small 

 

504 Id.

505 Email from Dominic Mancini, OIRA, to Jim Laity and Howard Shelanski, OIRA (Nov. 7, 2013, 10:25 a.m.) 

(OMB-041462).

506 Email from Jim Laity, OIRA, to Manisha Patel, CEQ (Nov. 4, 2013, 5:48 p.m.) (OMB-051156) (unredacted 

version on file with U.S. Dept. of Justice).
145

entities” as regulated parties (that is regulates somebody else on its face) 

but through, a larger interconnected set of regulations has the effect of 

imposing regulatory requirements directly on small entities. For example, 

in my mind it is clear that a new federal water quality standard imposes 

“direct” effects on small entities because any discharger, including small 

dischargers, must have permit conditions as necessary to ensure that the 

standard is not violated. By changing a WO standard, the effect is that 

some permits for small entities will likely have to be changed. EPA has 

never agreed with this perspective, however.507

The agencies were aware of Advocacy’s concerns during the rulemaking process. In 

October of 2014, Greg Peck of EPA stated in an email “It’s a significant legal and policy concern 

that SBA continues to conclude in writing that another federal agency has certified its proposed 

rulemaking in error.”

508

Documents show that despite OIRA’s own internal recommendations and Advocacy’s 

objections, no consensus ever occurred. Advocacy’s position was ignored and OIRA did not 

challenge the EPA in order to allow the rule to move forward. Instead of evaluating the EPA’s 

compliance with the RFA and SBREFA, OIRA undertook an informal evaluation of the “value”

of an SBAR panel.509

Documents show OIRA struck a deal with the EPA to conduct “informal outreach” to the 

small business community in lieu of conducting additional analysis under SBREFA. OIRA 

recognized the problem with the EPA’s certification and offered that conducting an informal, 

off-the-record, and non-judicially-reviewable outreach meeting would suffice for SBREFA 

 

507 Id. (emphasis added)

508 Email from Gregory Peck, EPA, to Jim Laity, OIRA (Oct. 1, 2014, 3:12 p.m.) (OMB-051264) (unredacted 

version on file with U.S. Dept. of Justice).

509 Email from Jim Laity, OIRA, to Vlad Dorjets, OIRA, et al. (Apr. 29, 2015, 11:02 a.m.) (OMB-034284). 
146

purposes so long as the results of the meeting were made public. As OIRA noted in an internal 

document, “voluntary outreach” from an EPA perspective had substantial benefits because an

SBAR panel required by SBREFA would be judicially reviewable under the RFA,510 whereas 

these “outreach” panels would not allow an aggrieved or adversely affected small entity to 

challenge the EPA’s compliance with these requirements.

511

Laity testified about that internal OIRA document, titled “Interagency Working Comments on 

Draft Language under EO12866 and 13563 Interagency Review Subject to Further Policy 

Review.” He stated:

Q In the same paragraph you recommend that, quote: “The proposed 

rule would also make clear that this is a voluntary outreach effort on 

the part of EPA which is not judicially reviewable under SBREFA,”

unquote. Can you explain why you made this specific 

recommendation? 

A The recommendation was—I know it’s a little hard to parse this 

sentence—but the recommendation was that the proposed rule 

would make clear that this is a voluntary outreach effort on the part 

of EPA. It was essentially a descriptive statement to say that a 

voluntary effort is not judicially reviewable under SBREFA. So I 

wasn’t suggesting or wasn’t intending to suggest that that should be 

emphasized in the preamble. That’s really up to EPA what they 

wanted to say about that. I was telling my boss Dom that I wanted 

 

510 Interagency Working Comments on Draft Language under EO12866 and 13563 Interagency Review Subject to 

Further Policy Review 2, Attachment, Email from Jim Laity, OIRA, to Dominic Mancini, OIRA (Dec. 11, 2013, 

3:39 p.m.).

511 5 U.S.C. § 611(a).
147

to make sure that EPA was clear that this was not a regular SBREFA 

report, that it was a voluntary report.512

To increase the formality of the outreach meeting, OIRA had the EPA draft a document 

entitled “Final Summary of the Discretionary Small Entity Outreach for EPA’s Planned Proposal 

Revised Definition of Waters of the United States.” Between November 26, 2013, and 

December 2, 2013, Laity and Greg Peck of the EPA exchanged a series of emails regarding the 

Small Business Outreach Report, including one referencing their agreement.

513

An internal OIRA memorandum discussing outstanding issues prior to the release of the 

proposed WOTUS rule stated that Advocacy was not a party to this agreement, but instead 

“might be persuaded that it is an acceptable substitute for a full SBREFA process.”

514

Testimony shows the use of an informal outreach meeting appears to be unique to 

WOTUS. OIRA staff could not recall other instances where outreach panels were conducted. 

For example, Laity testified:

Q Are you aware or have you ever worked out similar arrangements 

for other rules that informal or, as you put it, voluntary outreach be 

conducted when an agency certifies a rule? 

 

512 Laity Tr. at 127-128 (Mar. 8, 2016).

513 Email from Jim Laity, OIRA, to Gregory Peck, EPA, (Nov. 27, 2013, 12:49 a.m.) (OMB-009704).

514 Waters of the US Outstanding Policy Issues, Internal Memo, OIRA on Waters of the US Outstanding Policy 

Issues (Jan. 9, 2014) (OMB-045605).
148

A No.

Q Then why did you do it in this case, because the policy 

recommendation from your superiors or for my other reason? 

A This is a very high visibility rule that a lot of stakeholders had a lot 

of interest in, and we knew that there was going to be a lot of scrutiny 

of it. And so even though the agency had made a legal determination 

which my boss, who was a lawyer, agreed with that these were 

indirect effects and that it was proper for the agency to certify the 

rule, I think everybody involved, including EPA and OIRA, agreed 

that it would be appropriate to provide voluntarily as rigorous an 

outreach and sort of formal outreach opportunity to small entities as 

we could and adopt a SBREFA-like process.515

SBREFA requires the Chief Counsel for Advocacy to “identify individuals representative 

of affected small entities for the purpose of obtaining advice and recommendations from those 

individuals about the potential impacts of the proposed rule.”

516

 The EPA’s certification of the 

rule and use of an informal outreach meeting rather than pursuing a formal SBREFA process 

meant that it had discretion in the invitation process and it is unclear to what level it truly 

engaged with Advocacy, which repeatedly raised objections. Laity testified:

Q Who decided which small business industry representatives to invite 

to the EPA’s outreach meeting? Do you recall? 

A Under SBREFA, what happens is the EPA and the Small Business 

Office of Advocacy consult. Usually EPA prepares an initial list 

first, and then the Office of Advocacy often suggests initial names 

for that list. It’s usually very collegial, and EPA usually accepts 

whatever names Advocacy wants to add to the list. 

My understanding, because we were trying to make this as much 

like SBREFA as possible, is that a process something like that 

happened where they collaborated on inviting the small—

identifying and inviting small entity representatives. OIRA 

typically does not get involved in that process, so I don’t know the 

details of it. 

Q When you say “they,” you meant the Office of Advocacy was 

involved in creating that invite list? 

A I believe so, but I don’t know that for a fact.

 

515 Laity Tr. at 129-130 (Mar. 8, 2016).

516 5 U.S.C. § 609(b)(2).
149

Q Okay. Going back to your November 27 email, which I believe was 

exhibit 6, you stated that “I will offer SBA the opportunity to make 

comments, paren, (we might have some too) and try to convince 

them that this is a good way forward,” quote. Can you explain this 

comment? 

A As I’ve said, we were trying to make the process as much like 

SBREFA as possible, and so having them participate in the drafting 

of the report through making comments was consistent with that. I 

was also aware that they were raising concerns that it would have 

been better not to certify the rule and to have an actual SBREFA 

process, and so I wasn’t sure if they would agree. 

You know, the first part had happened like over a year earlier when 

we had the outreach, and they did participate. I believe they helped 

craft the list of invitees. They certainly showed up for the outreach 

meeting, so they had been cooperating up to that point. But they had 

informed us that they didn’t agree during the review of the proposed 

rule. Now, I don’t know if they ever formally agreed to this at an 

earlier stage or not. All I know is that Cass formally agreed to it. 

I don’t know what the Small Business Administration’s earlier 

position was, but at the time of the proposed rule review, they were 

raising concerns about it, so I wasn’t sure if they were going to 

follow through or not. But I was telling Greg that I would do my 

best, consistent with OIRA’s position here and agreement, to have 

them participate in this process. 

Q And did you end up having that conversation with somebody at the 

Office of Advocacy? 

A Yes. 

Q With whom? 

A Kia Dennis. 

Q And how did she respond? 

A She thanked me for the opportunity to provide comments; she said 

she would have to consult internally; and then she got back to me at 

some point later and said that advocacy would not provide 

comments on the report.517

 

517 Laity Tr. at 140-142 (Mar. 8, 2016).
150

Stakeholder associations that participated in the session expressed that the rule would, in 

fact, have a significant economic impact on a substantial number of small entities and that the 

rule would impose direct costs.518 Those present felt “strongly that the EPA should complete a 

regulatory flexibility analysis, and complete a formal Small Business Advocacy Review 

Panel.”

519 Notwithstanding these assertions, Advocacy’s concerns, and internal concerns at 

OIRA, the Administration proceeded with the rule without conducting on-the-record, small 

business outreach, as required by SBREFA.

The WOTUS Rule is a Product of a Flawed Comment Review

While the APA provides substantial statutory requirements for rulemaking, there is no 

specific requirement that agencies must respond to every comment that is received. Rather, 

courts have held that agencies must respond to comments that are material to issues raised in the 

rulemaking520 and “those comments that raise significant problems.”

521

 In instances where the 

comments inform the agency so that changes occur, these changes in the final rule must be a 

“logical outgrowth of the rulemaking proceeding.”

522

A. PUBLIC COMMENTS MAY HAVE BEEN MISCHARACTERIZED

Following the proposed rule stage of WOTUS, both the EPA and the Corps were 

responsible for evaluating and addressing public comments. Testimony shows that public 

comments may have been mischaracterized in their review. Specifically, the agencies placed 

public comments into buckets by category and used those general categories (rather than the 

comments themselves) to draw conclusions about potential changes to the rule. Moyer testified:

Q Tell me, what did you see as the trends that were developing in your 

discussions about what the public comments showed?

A From the analysis that our team had done, we reflected that the 

substantive public comments, so the—within the 1,000—not 1,000, 

1.1 million comments, there were about 21,000 unique comments, 

and then there was a subset of those, around 2,000 or so, 2,000, 

3,000 or so that were truly substantive letters that were more than, 

you know, one-liners that we analyzed. 

And in those, there were percentages that we put into various 

buckets. So they either dealt with ditches, or they dealt with 

adjacency, or they dealt with isolated waters. And it’s difficult to 

 

518 EPA, SUMMARY OF THE DISCRETIONARY SMALL ENTITY OUTREACH FOR PLANNED PROPOSED REVISED 

DEFINITION OF “WATERS OF THE UNITED STATES” 13, available at https://www.epa.gov/sites/production/files/2014-

06/documents/small_entity_report.pdf.

519 Id. at 10.

520 Portland Cement Ass’n v. Ruckelshaus, 486 F.2d 375, 393-94 (D.C. Cir. 1973), cert. denied, 417 U.S. 921 

(1974).

521 North Carolina v. Federal Aviation Administration, 957 F.2d 1125, 1135 (4th Cir. 1992) citing Action on 

Smoking and Health v. Civil Aeronautics Bd., 699 F.2d 1209, 1216 (D.C.Cir.1983).

522 United Steelworkers of America, Etc., v. Marshall, 647 F.2d 1189, 1221 (D.C. Cir. 1980).
151

characterize them, although we did, as being positive or negative or 

neutral or just providing information. 

Q Right.

A And even though we did that characterization, I think it’s troubling 

to just say, okay, of the ditch comments—these are not the numbers, 

you know—X percentage are positive—so I’m not going to use the 

numbers—X percentage are positive, X percentage are negative, 

because I don’t think it’s informative. But when we would be 

specifically talking about those, to generally characterize those 

as the public wants clarity on ditches, and then to link it to, and 

this is the clarity they want, was troubling for the Corps. 

Because that’s not necessarily the translation when you read the 

comments that the public sent in. 

Same thing with the public wants bright-lines. Well, when you read 

the comments, are these the bright-lines that the public has asked 

for?

523

Moyer also testified that as the Corps went through the comment process, they identified 

that pieces of the rule missed the mark and the public felt that more guidance was necessary. 

Moyer stated:

Q You said something was troubling for the Corps. Or was it troubling 

for you?

A When I say troubling for the Corps, I would say the team that we 

brought in to analyze these comments and summarize them, when I 

was providing the draft rule text to them to say, does this capture –

and we broke them into teams. So the folks who read the ditch 

comments, I said, this is how the ditch language was changed. Does 

this reflect the comments that the public sent?

So they would read it and say yes, no, sort of, we’re kind of 

getting there, or you guys are missing the mark. And I would 

take that back to these calls and say, we’re not characterizing or 

we’re not capturing what the public has asked us to do. Or we 

have – you’ve gotten it here, you aren’t getting it here. So when 

I say the Corps, that’s what I’m reflecting.524

***

 

523 Moyer Tr. at 63-64 (Dec. 17, 2015). (emphasis added)

524 Moyer Tr. at 64 (Dec. 17, 2015). (emphasis added)
152

Q I’m interested in knowing, when your team looked at the public 

comments about this—I’m sticking with the bright-line issue for the 

moment. When they looked at the public comments about need for 

a bright-line, and then you looked at the language that had been 

presented to your team sometime after January of 2015, what was 

your team’s interpretation of what the bright-lines meant?

A I think that it’s fair to say that in many different comment letters 

there were requests to define ordinary high water mark this way, 

define ditch like this. That would be a very clear definition and 

would provide clarity. And so to provide a bright line—and I didn’t 

read all the comment letters, so I think it would be interesting to 

know, and I don’t know this, if any letter said, please provide us a 

bright line. 

So I don’t know if that was in any specific comment letter, or if that 

is just a way that we have characterized the request for this extreme 

clarity in the rule. 

So what I would suggest is that my team looked at the bright lines 

that were defined in the rule and compared it to the body of 

comments that they have received to say, well, I had 15 comments 

that said they wanted this type of clarity, that wanted a definition 

that reflected this, this, and this, for bed and bank and ordinary high 

water mark, and we defined it this way. It’s not reflected what they 

are requesting. So that’s kind of the granularity that they were 

looking at. 

Q So it seems that what you are saying is that your team felt that the 

public was looking more for clarifications on definitions of things? 

A Or they may have been looking for a bright line in terms of 

adjacency or what have you that was at a different distance threshold 

than what was in the rule. I mean, a bright line is a bright line, 

whether it’s at 50 feet or whether it’s at 50,000 feet.525

 

525 Moyer Tr. at 71-72 (Dec. 17, 2015).
153

B. REVIEW OF PUBLIC COMMENTS WAS RUSHED

FINDING: Public comments were not fully reviewed and considered before 

agencies drafted the final rule. The agencies contrived a unique 

process for considering and responding to public comments, 

despite arguments from Army Corps and EPA staff in favor of 

including such responses in the rule’s preamble, as is customary.

The timeframe of the comment review process raises questions as to whether the agencies 

conducted a full review of unique comments before the final rule was issued. The final rule was 

announced on May 27, 2015, but as a January 2015 memo from the Corps to OIRA notes, the 

comment process was going to require a substantial amount of work, and in fact, at that time, the 

agencies had not yet initiated their substantive review of the comments.

526

 

526 Email from Charles Smith, Army Corps, to Jim Laity, OIRA, (Jan. 23, 2015, 12:49 p.m.) (OMB-045174-7).
154

Documents also show the EPA chose an uncharacteristic process for conducting the 

review and responding to public comments. In an April 14, 2015 email, Jim Laity stated that

public comments are generally discussed in a rulemaking preamble.527 For WOTUS, however, 

EPA chose to address public comments in a “massive separate response” which was “unlikely to 

be finished” in time for OIRA to review.528 

This decision came from the top, according to an email from Jim Laity, who wrote in an 

email: “EPA staff said it was Gina’s personal decision to write the preamble this way, and she 

was fully informed that this was ‘atypical’ for a final rule preamble.”

529

According to Jennifer Moyer’s testimony, despite concerns that doing so would be

contrary to standard agency process, the EPA and Army decided that comments could be 

addressed after the final rule entered interagency review.530

C. OIRA DID NOT REVIEW WHETHER COMMENTS WERE ADDRESSED

Witnesses from OIRA have differing perspectives on whether they are responsible for 

reviewing how an agency addresses public comments. Administrator Shelanski testified that 

OIRA does review public comments.531 Administrator Shelanski also testified that OIRA would

 

527 Email from Jim Laity, OIRA, to Howard Shelanski, Dom Mancini, and Katie Johnson, OIRA (Apr. 14, 2015, 

6:27 p.m.).

528 Id.

529 Id.

530 Moyer Tr. at 33 (Dec. 17, 2015).

531 Accountability and Transparency Reform at the Office of Information and Regulatory Affairs Hearing Before the 

Subcomm. on Gov’t Operations of the H. Comm. On Oversight and Gov’t Reform, 114th Cong. (Mar. 15, 2016) 
155

review the final WOTUS rule to ensure agencies captured public comments accurately. He 

stated:

Q When asked about WOTUS during the Committee’s March 3rd, 

2015, oversight hearing, you testified that part of what OIRA does 

when it reviews final rules is to look to see how the agency has 

reacted to and addressed important public commentary. “So we 

look forward to doing so when the rule comes back to us for final 

review.”

A Yes.

Q Is this a fair characterization of OIRA’s activities?

A Part of what we do when we review a final rule is look to see how 

public comment has been addressed.532

Contrary to Administrator Shelanski’s testimony, other OIRA witnesses testified that responding 

to public comments is the responsibility of the agency533 and that OIRA does not review how an 

agency addresses public comments. For example, Jim Laity testified: 

Q We understand that part of OIRA’s job is to look to see how the 

agency has reacted to and addressed important public commentary. 

Can you explain this process? In other words, how does OIRA 

ensure that an agency has appropriately considered and responded 

to public comments? 

A OIRA is charged with a lot of things in review of the rule, but it is 

not charged with ensuring that agencies have appropriately 

responded to public comments. That’s a responsibility under the 

Administrative Procedures Act. So we don’t ensure that.534 

Furthermore, contrary to Administrator Shelanski’s testimony, Laity testified OIRA did not 

engage in any effort to evaluate whether the agencies conducted a full review of the public 

comments or address them in the final WOTUS rule. Laity stated:

Q In the case of the final WOTUS rule, did you speak with the EPA or 

Army with respect to how they ultimately incorporated or addressed 

public comments? 

 

(Administrator Shelanski testimony) (“Once an agency drafts the final rule for publication, OIRA again plays an 

important role by ensuring that the agency takes account of the public comments on the earlier proposal, that the 

final rule logically follows from the proposed rule and those public comments and that the agency's final rule is 

well-grounded in the record evidence and meets applicable economic analytical requirements. Such accountability 

is essential to ensuring that agencies heed public comment and issue rules that are effective and efficient.”).

532 Shelanski Tr. At 105 (May 13, 2016). (emphasis added)

533 Laity Tr. at 31-36 (Mar. 8, 2016).

534 Id. at 31 (Mar. 8, 2016).
156

A I don’t recall having conversations about how they had responded 

to public comments.535

* * *

Q Do you typically ask agencies whether they have completed their 

review of substantive or major comments when a rule is sent to 

OIRA for final review? 

A No, we assume that that’s the case.536

Documents and testimony show OIRA was unable to review the agencies’ responses to 

comments because the EPA was still in the process of preparing its response to comments 

document when it submitted the rule to OIRA for final review. Typically, OIRA reviews the 

agency’s final summary and the agencies’ responses in the final rule. This did not occur with 

WOTUS since the comments were not all addressed in the preamble. Laity testified:

As I said, we don’t get involved in the review of the public comments. We 

are—first of all, a final rule always contains a fairly substantive summary 

of the substantive comments and the agencies’ responses and we review 

that. And then we frequently look at a selection. There’s usually way too 

many comments for us to read, but we look at a selection of public 

comments from key stakeholders in order to understand for ourselves sort 

of in the commenters’ own words what issues the commenters’ have raised. 

But we really don’t get involved in the agency’s job of responding to public 

comments.537

On April 7, 2015, Dorjets emailed Peck: “unsurprisingly [agencies] are already starting to ask 

about when the Economic Analysis (RIA?) will be made available and whether EPA will be 

submitting a response to public comment document.”

538

 In comments on the final rule from 

April 21, 2015, CEQ stated:

[The EA], the Response to Comments document and the [TSD] were not 

included with the final rule when it was submitted to OMB. The lack of 

these companion documents made the rule difficult to analyze and 

understand the full implications. Mindful that we are on a fast turn, 

we view this as an incomplete package.539

 

535 Id. at 35 (Mar. 8, 2016).

536 Id. at 36 (Mar. 8, 2016).

537 Id. at 34 (Mar. 8, 2016).

538 Email from Vlad Dorjets, OIRA, to Gregory Peck, EPA (Apr. 7, 2015, 2:05 p.m.) (OMB-039142).

539 Email from Katie Renshaw, CEQ, to Vlad Dorjets, OIRA (Apr. 21, 2015, 4:30 p.m.) (OMB-024605-6). 

(emphasis added)
157

Documents also show that as of May 13, 2015, the EPA was still working on Economic 

Analysis, rule, preamble, NEPA analysis, and a response to comments document. In a May 13, 

2015 email, Peck stated the response to comments document would accompany the final rule 

when published.540

D. THE AGENCIES RUSHED THE REVIEW OF PUBLIC COMMENTS 

The public submitted approximately 1.1 million comments about the WOTUS 

rulemaking. According to the Corps’ analysis, about 21,000 of these comments were unique.541 

An analysis of the comments described letters in opposition as “long, complex, meaty.”

542

 

The Corps made a significant effort to complete the review in the very limited period of time, but 

resources and time were both limited. The agencies completed their review of unique public 

comments in a mere five months.543 By way of comparison, it took the agencies eight months to 

review only 2,000 unique comments for the 2012 Nationwide Permit rule, for which the Corps 

brought in a roughly equivalent number of additional staff to help expedite review. Moyer 

testified: 

Q The final rule was sent to OIRA for final interagency review a mere 

5 months after the public comment period closed. It took the Corps 

8 months to read, review, and respond to the 2,000 comments 

received for the 2012 Nationwide Permit Program. How could EPA 

and the Corps in this case have read, reviewed, analyzed, and 

incorporated over 1.1 million, including the 20,000 unique 

comments that you referenced earlier, into the final WOTUS rule in 

such a short period of time? 

 

540 Email from Gregory Peck, EPA, to Vlad Dorjets, OIRA, and Craig Schmauder, Army (May 13, 2015, 2:11pm)

(OMB-005933).

541 Moyer Tr. at 63 (Dec. 17, 2015). (“From the analysis that our team had done, we reflected that the substantive 

public comments, so the—within the 1,000—not 1,000, 1.1 million comments, there were about 21,000 unique 

comments, and then there was a subset of those, around 2,000 or so, 2,000, 3,000 or so that were truly substantive 

letters that were more than, you know, one-liners that we analyzed. And in those, there were percentages that we put 

into various buckets. So they either dealt with ditches, or they dealt with adjacency, or they dealt with isolated 

waters. And it's difficult to characterize them, although we did, as being positive or negative or neutral or just 

providing information.”)

542 Email from Chip Smith, Army, to Let Mon Lee, Army (Jan. 22, 2015, 11:06 a.m.) (OMB-045176).

543 The comment period for WOTUS closed on Nov. 14, 2014. Five months later in Apr., 2015, WOTUS was 

submitted to OIRA for review. WOTUS was finalized two months later, in June, 2015.
158

A And I think that that’s very challenging. And I would say that that’s 

why I brought in additional staff to review them. And we prepared 

comment summaries. 

Q Were any additional staff brought in for the 2012 Nationwide Permit 

Rule? 

A Yes. We always bring in extra staff. 

Q So was the number of extra staff that you brought in for this rule 

significantly more than the 2012 Nationwide Permit Rule? 

A It was about equivalent. 

Q Equivalent? 

A Yes. 

Q So you were essentially doing that magnitude more of review—

because we’re talking about 2,000 comments versus 20,000 

comments—

A Uh-huh. 

Q —with the same amount of staff? 

A Right.544

Notwithstanding this effort, Craig Schmauder admitted that the Corps did not complete their 

review of public comments before the final rule was promulgated and was unaware of the Corps’

standard procedures for review. He testified: 

Q So when you were discussing your review then, versus the 

addressing, we’ll speak to the review portion, you believe that the 

review that the Corps was conducting was complete before the final 

rule was promulgated? 

A No. I don’t believe their review of it was completed. I think they 

were still reviewing as we were finalizing up the rule. 

* * *

 

544 Moyer Tr. at 30-31 (Dec. 17, 2015).
159

Q Were you aware that that’s not the Corps’ standard process for 

acknowledging or addressing comments received in the public 

comment period?

A I was not aware of the Corps’ standard procedures.545

The documents show email from December 2014 between Corps staff and OIRA that 

discussed some of the complexities that the Corps was dealing with in attempting to respond to 

the comments.

546

 

545 Schmauder Tr. at 135-136 (Feb. 17, 2016).

546 Email from Chip Smith, Army, to Jim Laity and Stuart Levenbach, OIRA (Dec. 1, 2014, 9:20 am) (OMB034370-034371).
160

(continued next page)
161

E. THE EPA DRAFTED THE FINAL RULE BEFORE COMPLETING THE PUBLIC 

COMMENTS REVIEW

The APA requires that the solicitation for public comments is more than an exercise in 

compliance.547 Agencies are expected and required to consider public comments (rather than 

simply collect them), read them, and provide text to explain why the agency will not deviate 

from its prefabricated plan.548 Documents and testimony show the EPA opted instead to simply 

release the rule on an arbitrary, politically motivated time table. 

The documents and testimony show the EPA drafted the final rule before conducting a 

robust analysis of the public comments.549 According to Moyer, the EPA had no qualms about 

simply checking the box of public comment review after the final rule was submitted to OIRA 

for a final review. She testified: 

Q Okay. And were you aware of any efforts to draft the final rule 

before you had engaged in the review of the public comments?

 

A There were conversations among, it was called the Team of eight 

which involved, which involved folks from EPA, Mr. Schmauder, 

and some of us from the Corps about how the rule was going to be 

drafted with its preamble, if there wasn’t this robust analysis of 

comments.

 

Because when the Corps drafts a rule and a draft final rule, we 

address the comments in the preamble. And there seemed to be a 

thought that the comments could be addressed while the draft final 

rule was in interagency vetting. And so we had a lot of 

 

547 5 U.S.C. 553(b) establishes the right to comment on agency rulemaking. 

548 See e.g., Portland Cement Assn. v. Ruckelshaus, 486 F.2d 375 (D.C. Cir. 1973) (“We find a critical defect in the 

decision-making process in arriving at the standard under review ... in the subsequent seeming refusal of the agency 

to respond to what seem to be legitimate problems with the methodology of these tests.”). 

549 Peck and Schmauder provided the draft final rule to the Team of Eight in Jan., 2015, while the Corps was 

reporting review of unique comments had not commenced as of Jan. 20, 2015. See email from Charles Smith, Army 

Corps, to Jim Laity, OIRA, (Jan. 23, 2015, 12:49 p.m.) (OMB-045174).
162

conversations about the approach to this. Because from the Corps’

standpoint, at least with my experience in rulemaking, those 

comments needed to be addressed in the preamble. 

Q And the preamble is a part of the product that is going through 

interagency review?

A That was my experience. EPA had a different experience, and EPA 

and Army were comfortable with addressing them during the 

interagency vetting. So ultimately that was the decision that was 

made and with some summary information about the comments in 

the preamble.

 

And so that was the process that was followed with a very detailed 

response to comment included in the final rule package.

Q So I understand, the package that entered the final interagency 

review included a preamble, but it only had a summary of the public 

comments there? 

A Summary statements about comments that informed the decisions 

that were reflected in the draft final rule.

Q And the clarifying or adding detail to the comment summaries in the 

preamble that you were discussing earlier, that happened during the 

interagency review?

A The very detailed, and I think it’s, if I’m remembering right, it’s 

about 13,000 pages, where every single public comment is 

responded to, is part of the final rule package.

Q And in your experience, that would have happened before the rule—

A How the Corps does it, we respond to the comments in the preamble.

 

Q Before the rule enters into the interagency review? 

A For the final rule, yes.550

The rule went to OIRA for final review without either agency completing a response to

public comments, meaning that public comments were not fully considered before the draft final 

rule was vetted by the Administration, and consideration of the public comments were likely not 

fully incorporated into the final rule.

 

550 Moyer Tr. at 33-34 (Dec. 17, 2015).
163

Recirculation of the Final Rule

Under regulatory requirements, if a rule changes significantly enough between its 

proposed stage and its final stage, to the point that the final version is not a “logical outgrowth”

of the original proposal, then the rule must be resubmitted as a new rulemaking.551

Chip Smith testified there had been discussions about recirculating the rule for a second 

round of public comment after substantive changes were made to the rule, but that recirculating 

was ultimately decided against. He testified: 

Q Are you aware of whether the EPA or Army discussed recirculating 

the draft final rule for a second round of public comment after 

changes were made to the draft final rule? 

A In gang of eight meetings, both myself and others, at least on the 

Corps side, talked about recirculating it. We thought the changes 

being proposed were significant and not in sync with the draft rule, 

and that the public really should have an opportunity to comment on 

those, what we believed were significant changes. 

Q And what was the response from the rest of the team? 

A The EPA side of the team and Mr. Schmauder said they thought the 

changes logically flowed from the draft rule and that there would be 

no recirculation, it was not necessary and it would not comport with 

the administrator’s schedule. 

Q Were you given any reason as to why they believed that your 

disagreement was not significant? 

A No.552

Jim Laity testified that re-circulation of a rule is possible when substantive changes are 

made in the final stages of the process, as happened in WOTUS, but that such a recirculation did 

not occur in that case. Laity testified:

Q In the case that a rule is submitted for interagency review, and I’m 

talking about in the final rule stage, and substantive or policy 

changes or technical changes are made to that rule after interagency 

review, are agencies given a second opportunity to review the 

updated rule? 

 

551 See Weyerhaeuser Co. v. Costle, 590 F.2d 1011, 1031 (D.C. Cir. 1978) (striking down EPA regulations because 

they were not a “logical outgrowth” of the proposed rules); see also 5 U.S.C. § 553(b)-(d) (2000) (setting out the 

rulemaking process).

552 Smith Tr. at 38-39 (Jan. 21, 2016).
164

A You mean after interagency review of the final rule?

 

Q Correct. 

A It’s very rare that there are substantive changes to a rule after 

interagency review of the final rule. Once we conclude a review, 

that is the version that is supposed to be published in the Federal 

Register. 

What sometimes happens is the agency will find minor technical 

mistakes or corrections that they want to fix and they will usually 

inform us of that. And we would make a judgment at that point 

about whether or not what was being represented as a minor 

technical fix really was. And we would certainly maintain the 

prerogative to say that’s more than a minor technical fix and you 

have to reopen the interagency review, but that typically doesn’t 

happen. 

Q Did that happen with respect to this rulemaking?

A I don’t recall that it did.

553

 

553 Laity Tr. at 39-40 (Mar. 8, 2016). (emphasis added)
165

FAILURE TO COMPLY WITH STATE, LOCAL, AND TRIBAL CONSULTATION 

REQUIREMENTS

FINDING: The agencies failed to comply with various rulemaking obligations, 

including Executive Orders requiring consultation with states and 

local governments and tribes.

The preamble to the WOTUS rule recognizes that “[s]tate, tribal, and local governments 

have well-defined and longstanding relationships with the Federal government in implementing 

CWA programs . . . .”

554

 State and local governments, leaders of Native American tribal nations, 

and staff within the Corps, however, articulated “pretty clear and strong comments” that they 

were not consulted prior to the issuance of the WOTUS Rule.555 

Failure to consult with state, local, and tribal governments is not only a contradiction to 

the rulemaking’s own guiding principle, but also clashes with various statutes, executive orders, 

and, perhaps most significantly, the Nation’s founding principle of federalism.

The Agencies Failed to Comply with Executive Order 13132 and Principles 

of Federalism

The CWA states that “[i]t is the policy of Congress to recognize, preserve, and protect the 

primary responsibilities and rights of States to prevent, reduce and eliminate pollution.”

556

 

Congress expressly retained language to ensure that the concept of federalism envisioned by the 

Founders was not lost as the Nation’s water pollution laws shifted towards federal control.557 

Furthermore, the preservation of federalism was not meant to merely be guidance, as multiple 

sections of the CWA require consultation with appropriate local and State agencies prior to 

issuing regulations.558 For example, Section 501 of the CWA, which deals with administering 

the Act, requires, in part, that “the Administrator shall, in consultation with the appropriate State

water pollution control agencies, establish regulations.”

559

 In addition to the various state consultation requirements under the CWA, Executive 

Order 13132 requires federal agencies to consult with state and local governments when issuing 

rules which have federalism implications, and sets forth certain guidelines agencies must follow 

in the formulation and implementation of such policies. Promulgated on August 4, 1999, EO 

13132 was implemented “to ensure that the principles of federalism established by the Framers 

 

554 Definition of “Waters of the United States” Under the Clean Water Act, 80 Fed. Reg. 37,054, 37,055 (June 29, 

2015). 

555 Email from Vlad Dorjets, OIRA, to Tera Fong, OMB (May 12, 2015, 1:10 p.m.) (OMB-039660).

556 Clean Water Act, 33 U.S.C. § 1251(b). 

557 Water Pollution Control Act of 1948, Pub. L. No. 80-845, 62 Stat. 1155 (1948) (codified as amended in scattered 

sections of 33 U.S.C.). 

558 33 U.S.C. §§ 1252-54, 1361(e)(1). 

559 33 U.S.C. 1361(e)(1). (emphasis added)
166

guide the executive departments and agencies in the formulation and implementation of 

policies.”

560

 

In addition to requiring “strict adherence to constitutional principles,” this Executive 

Order mandates that “[n]ational action limiting the policymaking discretion of the States shall be 

taken only where . . . the national activity is appropriate in light of the presence of a problem of 

national significance.”

561

 Further, in instances of “significant uncertaint[y]” as to whether 

national action is authorized, or even appropriate, the Order requires agencies to “consult with 

appropriate State and local officials to determine whether Federal objectives can be attained by 

other means.”

562

Once an agency has determined that their policymaking has federal implications, EO 

13132 requires that, before promulgating a final rule, the promulgating agency must “consult 

with appropriate state and local officials as to the need for national standards and any alternatives 

that would limit the scope of national standards or otherwise preserve state prerogatives and 

authority . . . .”563 EO 13132 further proscribes the promulgation of rules with “federalism 

implications” or “substantial direct compliance costs on state and local governments,” unless the 

federal government “consulted with State and local officials early in the process of developing 

the proposed regulation.”

564

WOTUS has federalism implications under EO 13132. The Executive Order defines 

“policies that have federalism implications” as “regulations . . . that have substantial direct 

effects on States (individually or collectively), on the relationship between the national 

government and the States, or on the distribution of power and responsibilities.”

565

 Despite the 

Supreme Court recognizing that “the entire land area of the United States lies in some drainage 

basin and . . . any plot of land containing such a channel may potentially be regulated as a “water 

of the United States,”

566 the Corps and the EPA found that the WOTUS Rule “does not have 

federalism implications” and “will not have substantial direct effects on the states.”

567

 The 

agencies’ decision that the WOTUS rule does not have federalism implications is particularly 

questionable given the Court’s recognition that the WOTUS Rule could “put the property rights 

of ordinary Americans entirely at the mercy of EPA employees.”

568

The WOTUS rule greatly expands the federal government’s jurisdiction under the CWA

over waterways and drinking water supplies throughout the United States. According to a 

complaint filed by thirteen states challenging the rule, “[t]he Final Rule’s displacement of state 

 

560 Exec. Order No. 13132, 64 Fed. Reg. 43255 (Aug. 4, 1999) (defining “policies that have federal implications” as 

“regulations, legislative comment or proposed legislation, and other policy statements or actions that have 

substantial direct effects on States, on the relationship between the national government and the States, or on the 

distribution of power and responsibilities”).

561 Exec. Order No. 13132, 64 Fed. Reg. 43256 (Aug. 4, 1999).

562 Id. (emphasis added)

563 Id.

564 Exec. Order No. 13132, 64 Fed. Reg. 43257-58 (Aug. 4, 1999). (emphasis added)

565 Exec. Order No. 13132, 64 Fed. Reg. 43255 (Aug. 4, 1999).

566 Rapanos v. U.S., 547 U.S. 715, 722 (2006).

567 80 Fed. Reg. 37,054. 

568 Sackett v. E.P.A., 132 S. Ct. 1367, 1375 (2012) (Alito, S., concurring). 
167

authority over water quality and related land and water resources imposes harm upon the 

States.”

569

 

Lance Wood, the assistant chief counsel of the Environmental Law and Regulatory 

Programs with the Corps, stated in a April 24, 2015 memorandum that the “assertion of CWA 

jurisdiction over millions of acres of isolated waters could be seen as “regulatory over-reach.”

570

Given that “[a]ny piece of land that is wet at least part of the year is in danger of being 

classified by EPA employees as wetlands covered by the Act,”

571 it is clear that the rule displaces 

“state authority over water quality and related land and water resources”

572 and, thus, has 

federalism implications which requires consultation with the States. 

The Agencies Failed to Properly Consult with State and Local Governments 

as Required by the Clean Water Act, Executive Order 13132, and California 

Wilderness

Documents and testimony show that during the rulemaking, the agencies made minimal 

efforts to consult with state and local governments—despite the fact that the WOTUS rule would 

significantly impact states and localities across the entire United States573—and failed to request, 

let alone utilize, scientific data from the states and local governments most closely connected to 

the regulated waterways.574

In determining what constitutes “consultation” for purposes of notice and comment 

rulemaking, courts have held for states and local governments during judicial review of agencies’

interpretation of a statutory term, emphasizing the interpretation of consultation to mean 

 

569 Complaint, North Dakota v. EPA, No. 3:15-cv-00059 (D.N.D. June 29, 2015), 2015 WL 3955508 (Filed by the 

States of North Dakota, Alaska, Arizona, Arkansas, Colorado, Idaho, Missouri, Montana, Nebraska, Nevada, South 

Dakota, Wyoming, and the New Mexico Environment Department and New Mexico State Engineer).

570 Memorandum from Lance Wood, U.S. Army Corps of Engineers, to Major General John Peabody, U.S. Army 

Corps of Engineers (Apr. 24, 2015) at 10. 

571 Sackett v. E.P.A., 132 S. Ct. 1367, 1375 (2012) (Alito, S., concurring).

572 Complaint, North Dakota v. EPA, No. 3:15-cv-00059 (D.N.D. June 29, 2015), 2015 WL 3955508, at 46.

573 Smith Tr. at 17-18 (Feb. 19. 2016) (describing the rule as “the most important rulemaking...in 20 years, 

according to both the Corps and the Army and testimony...the Administrator and Assistant Secretary make to 

Congress”).

574 Smith Tr. at 136 (Jan. 21, 2016) (stating “there’s no actual direct State or tribal data requested and used in the 

analysis”). 
168

conferring prior to taking action, not after.”

575

 In California Wilderness Coalition v. U.S. 

Department of Energy, the Ninth Circuit held that the Department of Energy (DOE) failed to 

engage in “consultation with the affected states,” as required by § 216 of the Energy Policy Act 

of 2015, rejecting that the agency’s use of notice and comment complied with the provision.576 

As in California Wilderness, during the WOTUS rulemaking the EPA and the Corps 

merely contacted states and local governments through general outreach meetings and webinars. 

According to Chip Smith, such informal communications are not considered “consultations” that 

would “satisfy the Executive Order and other legal obligations of the rulemaking agencies.

577

 In 

fact, where the court in California Wilderness felt that in person conferences were not sufficient 

to meet the state consultation requirements, the agencies, in drafting the WOTUS Rule, failed to 

even go that far and instead relied on the aforementioned webinars and letters, without any inperson meetings. Smith testified:

Q Would you consider informal outreach meetings and webinars or 

other group meetings to satisfy the type of meaningful predecisional 

consultation that would satisfy the Executive order and other legal 

obligations of the rulemaking agencies? 

A No. The Army course we teach specifies face to face, government 

to government consultation between district engineer and chairman, 

chief, Governor, or President. Informal communications, letters, 

Webinars, are not consultations; they are education tools. And all 

of this needs to be predecisional, not after rules are promulgated.578

Testimony shows that in addition to failing to provide proper consultation opportunities, 

the agencies failed to utilize the contact they had with states in order to garner actual input 

related to state data to use in their evaluations. Chip Smith further testified:

There’s—oh, the big one, well, another big one for me was there’s no 

actual direct State or tribal data requested and used in the analysis. It 

was all done through surrogate economic evaluation methods, like 

willingness to pay, ability to pay, and that sort of thing.579

According to Smith’s testimony, he suggested to his superior on multiple occasions that 

the EPA and the Corps’ consultation with state and local governments was insufficient, yet was 

only met with indifference. When discussing the absence of state, local, and tribal data in the 

rule’s Economic Analysis, Smith testified: 

 

575 California Wilderness Coalition v. U.S. Department of Energy, 631 F.3d 1072 (9th Cir. 2011).

576 Id.

577 Smith Tr. at 26 (Feb. 19. 2016). 

578 Id. 

579 Smith Tr. at 137 (Jan. 21, 2016). (emphasis added)
169

Q So let’s pick the time period getting closer to the finalization of the 

rule. Let’s say between August of 2014 and forward, as you were 

creating those drafts, did you, the concerns that you raised in those 

bubble boxes, were they the subject of discussion internally between 

you and Mr. Schmauder or anybody else at the Army in which the 

concerns that you raised were the subject of the discussion?

A Yes. 

Q And how often did those take place? 

A I would say between August and Thanksgiving, several times a 

month. After that, just a couple times. 

Q And who was in the discussion with you about these concerns in 

your draft? 

A Craig Schmauder, the Army team, and, when we had our joint 

meetings, all the EPA people that I listed previously. 

Q And Craig and the Army team, who was in the Army team? 

A Craig is it, me. There’s only two of us. 

Q And so, essentially, it was back and forth between you and Craig 

about what your concerns were? 

A Uh huh. 

Q And how would you characterize Craig’s responses to your 

concerns?

A Unreceptive.580

Smith also testified the Corps was largely left out of the outreach efforts. He stated:

Q Do you know whether the Army or Corps conducted outreach with 

all 50 States in the course of this rulemaking? 

A I did not. The Corps did not. I can’t speak for Army general 

counsel. 

Q Do you know whether the EPA conducted outreach with all 50 

States? 

 

580 Id. at 137-38. (emphasis added)
170

A Post promulgation of the draft rule, outreach was conducted, but I 

don’t recall how many States out of the 50 they reached.581

Indeed, OIRA, under its responsibility for reviewing draft regulations and rules from 

federal agencies, expressly acknowledged this concern. Vlad Dorjets told his supervisors in an 

email dated May 13, 2015, “we have heard complaints from cities and states about a lack of 

consultation prior to the proposed rule being issued and a lack of coordination and outreach since 

then.”

582

Dorjets also speculated that the concerns raised by cities and states “may just be political 

posturing.”

583

Despite the “clear and strong comments,” as characterized by OIRA, of the National 

League of Cities, National Association of Counties, and United States Conference of Mayors, the

EPA argued that they did not need to further consult with the states and local governments,

because they received letters from a number of cities following the Rapanos decision. They

argued to OIRA that “we’ve heard you and we’ve made changes responsive to your 

 

581 Id. at 115.

582 Email from Vlad Dorjets, OIRA, to Drew McConville, Council on Environmental Quality, et al. (May 13, 2015, 

11:42 a.m.) (OMB-034317). (emphasis added)

583 Id. (emphasis added)
171

comments.”

584

 However, this goes directly against the requirements of the APA, which requires 

new comments to be received and considered only after proper notice is given.585 Though the 

notice “need not identify every precise proposal which the agency may adopt,” the notice must 

nonetheless “apprise[ ] interested parties of the issues to be addressed in the rule-making 

proceeding with sufficient clarity and specificity to allow them to participate in the rulemaking in 

a meaningful and informed manner.”

586

 Even under this relaxed standard, the Rapanos 

decision—issued eight years prior to the issuance of the proposed rule—does not constitute 

sufficient notice, and, as a result, any comments received following Rapanos but prior to the 

official proposal would not constitute proper consultation. 

587

More than half of the States—in addition to numerous other stakeholders—felt so 

strongly that the agencies “declined to conduct a federalism analysis, despite numerous requests 

 

584 Email from Tera Fong, OMB, to Vlad Dorjets, OIRA (May 12, 2015, 1:50 p.m.) (OMB-039660). 

585 5 U.S.C. § 553.

586 American Medical Association v. United States, 887 F.2d 760, 767 (7th Cir. 1989). 

587 Email from Tera Fong, OMB, to Vlad Dorjets, OIRA (May 12, 2015, 1:50 P.M. EST) (OMB-039660) (emphasis 

added); email from Vlad Dorjets, OIRA, to Tera Fong, OMB (May 12, 2015, 1:10 p.m.) (OMB-039660). (emphasis 

added)
172

by states and others” that they immediately challenged the WOTUS rule in court.

588

 The 

Attorney General of the State of North Dakota wrote a letter to EPA Administrator Gina 

McCarthy, stating: “[t]he agencies declined to conduct a federalism analysis, despite numerous 

requests by states and others, failing to give consideration to these issues before issuing the final 

rule.”

589

The EPA Failed to Sufficiently Consult with Indian Tribal Governments

The agencies also failed to perform meaningful consultation with tribal governments in 

the development of the rule. On November 6, 2000 then-President Clinton signed Executive 

Order 13175—Consultation with Indian Tribal Governments – to “ensure that all Executive 

departments and agencies consult with Indian tribes and respect tribal sovereignty as they 

develop policy on issues that impact Indian communities.”

590

 The Executive Order ensures that 

in the course of rulemaking, agencies recognize “tribal sovereignty, self-determination, and selfgovernment” and “respect the Native Americans’ rights to choose for themselves their own way 

of life on their own lands according to their time honored culture and traditions” as required by 

both the law and the agencies’ own policies.591

 

588 Complaint, North Dakota v. EPA, No. 3:15-cv-00059 (D.N.D. June 29, 2015), 2015 WL 3955508 (Filed by the 

States of North Dakota, Alaska, Arizona, Arkansas, Colorado, Idaho, Missouri, Montana, Nebraska, Nevada, South 

Dakota, Wyoming, and the New Mexico Environment Department and New Mexico State Engineer); Complaint for 

Declaratory and Injunctive Relief, Oklahoma v. EPA, No. 15-cv-0381 (N.D. Okla. July 8, 2015), 2015 WL 4462248; 

Georgia v. McCarthy, No. 2:15-cv-00079 (S.D. Ga. Aug. 27, 2015), 2015 WL 5092568 (Filed by the States of 

Alabama, Florida, Georgia, Indiana, Kansas, Kentucky, South Carolina, Utah, West Virginia, Wisconsin, and the 

North Carolina Department of Environment and Natural Resources); Complaint, Ohio v. EPA, No. 2:15-cv-02467 

(S.D. Ohio June 29, 2015), 2015 WL 9269459 (Filed by the States of Ohio, Michigan, and Tennessee); Complaint 

and Petition for Review, Texas v. EPA, No. 3:15-cv-00162 (S.D. Tex. June 29, 2015), 2015 WL 3952929 (Filed by 

the States of Texas, Louisiana, and Mississippi). 

589 Letter from Wayne Stenehjem, North Dakota Attorney General, et al to Gina McCarthy, Administrator, EPA, & 

Jo-Ellen Darcy, Assistant Secretary of the Army (July 28, 2015) (on file with North Dakota Attorney General’s 

office).

590 Exec. Order No. 13175, 65 Fed. Reg. 67249. 

591 Id.
173

In furtherance of these principles, in “implementing policies that have tribal implications”

the Executive Order requires agencies to “consult with tribal officials as to the need for Federal 

standards and any alternatives that would limit the scope of Federal standards or otherwise 

preserve the prerogatives and authority of Indian tribes.”

592

 E.O. 13175 further states, “no 

agency shall promulgate any regulation that has tribal implications” unless “the agency, prior to 

formal promulgation of the regulation, consulted with tribal officials early in the process of 

developing the proposed regulation.”

593

According to the EPA’s Final Summary of Tribal Consultation for the Clean Water Rule: 

Definition of “Waters of the United State” Under the Clean Water Act; Final Rule, “the agencies 

consulted with tribal officials throughout the rulemaking process” and found that the WOTUS 

rule “does not have tribal implications as specified in E.O. 13175.”

594

 According to the report, 

“EPA coordinated with Army, and Army jointly participated in aspects of the consultation 

process.”

595

 Lead regulatory staff from both the Army and the Corps testified, however, that 

they were not aware of who drafted the report, and the Army and the Corps did not participate in 

such consultation under the Executive Order. Jennifer Moyer stated: 

Q In your May 15 memo, you provide that the statement in the 

Economic Analysis that this action does not have tribal implications, 

as specified in Executive Order 13175, is patently inaccurate, and 

that the effects have not been identified and evaluated. 

Who decided that the rule does not have tribal implications as 

specified under the executive order? 

A It was not the Corps.

Q Were you given the opportunity to weigh in on this decision? 

A No. I was not. My office was not.

Q Okay. Are you aware of who drafted the final summary of tribal 

consultation for the Clean Water rule, published in May of 2015? 

A I’m not aware who drafted that, no.

Q Okay. Were you given an opportunity to review this document? 

A No.

 

592 Id.

593 Id.

594 Environmental Protection Agency, Department of the Army, Final Summary of Tribal Consultation for the Clean 

Water Rule: Definition of “Waters of the United State” Under the Clean Water Act; Final Rule 3 (May 2015), 

available at https://www.epa.gov/sites/production/files/2015-05/documents/clean_water_rule_tribal_summary.pdf.

595 Id.
174

Q You also state in your memo that the affected tribes were not 

consulted as a part of the analysis, which appears to conflict with the 

EPA and Army’s characterization in their final summary of tribal 

consultation for the Clean Water rule. 

Were any tribal consultations conducted in the course of this 

rulemaking? 

A Tribes weren’t consulted following the Corps’ tribal policy, to my 

knowledge. We did not engage in any government-to-government 

consultation with tribes on this rule.

Q Is that something that the Corps typical engages in on rulemakings? 

A Yes.

Q Are you aware of who conducted them if they were conducted? 

A I’m not.

Q Who within the Army Corps usually conducts the tribal 

consultations under this executive order? 

A We’re undertaking a rulemaking right now on the Nationwide 

Permit Program, and our district offices will consult with the tribes 

within their areas of responsibility.

Q Okay. And then their recommendations or comments are sent to 

you? 

A Yes.

Q Okay. So in the course of this rulemaking, the Waters of the United 

States, you did not receive any comments from your district offices 

regarding tribal consultations? 

A No. And they wouldn’t have done it on this one. I would have 

presumed that it would have been Army or the Corps working with 

EPA with each of the federally recognized tribes.596

With respect to the report, Moyer testified:

Q The summary states that: “In the course of this consultation, EPA 

coordinated with Army, and Army jointly participated in aspects of 

the consultation process.” 

 

596 Moyer Tr. at 101-103 (Dec. 17, 2015). (emphasis added)
175

Do you know what aspects this document is referring to? 

A I’m not aware.

Q Okay. Is this the first time you’re seeing this summary document? 

A The cover looks familiar to me. But I’m not familiar with the 

contents of this.

Q Okay. But typically in a rulemaking where the Corps engages in 

Tribal consultations, you would have a part in drafting such 

summary to satisfy the executive order? 

A Yes. That would be my expectation, yes.597

Chip Smith, who serves as the head policy analyst for tribal affairs, testified that he was 

the only Army staffer responsible for, and equipped to, engage in consultation with tribes on this 

rulemaking. He further testified that such consultation did not occur. He stated:

Q So why was it different for WOTUS that you would have been the 

only person who would have consulted with over 500 tribes? 

A Because I would be the only one—this is a national rule that applies 

to all 404 actions. 

Q This being WOTUS? 

A WOTUS, I’m sorry, yes. And I was the only tribal person educated, 

on the rulemaking team, understood what the rule was, and who 

could have communicated it to tribal leaders. And the districts were 

not privy to early drafts. They were embargoed. So they couldn’t 

consult. 598 

* * *

Q Ms. Moyer also states in her memo that affected tribes were not 

consulted as a part of the analysis, which appears to conflict with the 

EPA and Army’s characterization in their final summary of tribal 

consultation for the Clean Water rule that I just handed around. 

To your knowledge, were any tribal consultations conducted in the 

course of this rulemaking? 

 

597 Id. at 103-104. (emphasis added)

598 Smith Tr. at 154-155 (Jan. 21, 2016).
176

A Not by the Corps or I. Had they been done, I would’ve been the one 

to do it. 

Q Were you aware of whether the EPA conducted any tribal 

consultations? 

A I am not aware of any they conducted.

Q Who with the Army or Army Corps usually conducts tribal 

consultations? You said you would have been a part of that? 

A Yes, ma’am.

Q And those are the consultations that are required under Executive 

Order 13175? 

A That’s correct. 

Q The EPA and Army tribal summary states that, quote, “In the course 

of this consultation, EPA coordinated with Army and Army jointly 

participated in aspects of the consultation process,” unquote. Do 

you know what aspects this document is referring to? 

A I do not, and it did not include me.

Q So you don’t know who in the Army was coordinating—

A I do not.

Q —on this? 

A I do not. 

Q Does anybody in the Army besides yourself have experience with 

tribal affairs? 

A Not like this, no—or not like I do, and I’m the only one who works 

on Army Civil Works, which includes regulatory tribal affairs. 

Q Let me restate just to make sure I understand.

 

A Okay. Yeah. 

Q So you are the only staff member in Army Civil Works—

A Civil Works.
177

Q —that engages in tribal affairs? 

A Yes, ma’am. 

Q And you were not consulted at all about this tribal consultation 

document that we’re seeing here? 

A I was not. 

Q Do you believe that the agencies fulfilled their coordination and 

consultation mandates with respect to tribes in this rulemaking? 

A No, ma’am.599

According to witness testimony, tribes expressed directly to Assistant Secretary Darcy 

that the rule would adversely affect tribal sovereignty and resources and that they had not been 

consulted on the rulemaking. Smith testified:

Q Have you spoken with or heard from any tribes about this 

rulemaking since promulgation? 

A Yes.

Q And what has been their input? 

A Ms. Darcy and I traveled to the Navajo Nation 2 weeks ago. We 

spent 3 days there. We attended a council meeting. We prepared 

talking points for her generally on the Corps of Engineers and things 

we do for the Navajo Nation. It was a full council meeting. So it’s 

kind of like one of your Senate rooms with all those chairs or House 

you know. So there were probably 50 tribal members there. And 

one council member stood up and said that the WOTUS rule 

adversely affected tribal sovereignty, it adversely affected tribal 

resources, that they had not been consulted with, and that the Navajo 

Nation viewed it as an abrogation of their sovereignty. And he 

spoke for about 15 minutes.

Q In our last interview and today, you’ve spoken a bit about your 

involvement in tribal affairs and experience and expertise with 

conducting tribal consultations for the Army and the Corps. You 

also stated that you agree that the agencies did not fulfill their tribal 

consultation obligations for WOTUS under Executive Order 13175. 

Is that correct? 

 

599 Id. at 19-20. (emphasis added)
178

A Correct.600

Documents show the Corps brought the agencies’ failure to properly consult with 

federally-recognized tribes to the attention of OMB and EPA. In a February 14, 2014 markup of 

the draft WOTUS rule, after the final rule had been drafted, the Corps stated “the agencies did 

not properly consult with federally-recognized tribes or properly evaluated impacts to reservation 

lands, or treaty and trust resources.”

601

 

600 Smith Tr. at 27-28 (Feb. 19, 2016) (emphasis added) .

601 Memorandum from Army Corps of Engineers to the Office of Management and Budget & Environmental 

Protection Agency, Summary of Corps Comments on OMB Comments on WOTUS Proposed Rule, at 1, 7 (Feb. 18, 

2014) (OMB-046642-9).
179
180

CONCLUSION

The WOTUS rule represents one of the most far-reaching and significant environmental 

regulations in modern history. It creates new restrictions on the rights of citizens, state and local 

governments, and tribes to use streams, lakes, rivers, and other water bodies on their properties 

and within their jurisdictions. It greatly expands the right of the federal government to monitor, 

control, and even penalize citizens for what they do on their own property, including how they 

operate their farms, ranches, and businesses.

The documents and testimony obtained by the Committee show serious flaws in the 

rulemaking process that affected the final WOTUS rule. The documents and testimony create 

the appearance that the rule was promulgated based on political considerations, with the 

involvement of outside special interest groups, and at the expense of adhering to rulemaking best 

practices and laws. The EPA repeatedly cut corners, disregarded statutes and executive orders, 

and ignored serious concerns voiced by experts, the states, and American citizens, in a 

deliberative effort to rush promulgation of the rule to meet the demands of the Obama 

Administration. Specifically, the documents and testimony show:

 Although WOTUS was a joint-rulemaking between the EPA and the Corps, the EPA 

routinely and intentionally ignored the Corps during the rule’s development to accelerate 

the process; 

 The EPA ignored important recommendations and concerns about WOTUS from 

multiple federal agencies, including the Corps, the Small Business Administration, and 

OIRA to avoid conducting a thorough, but lengthier, analysis of the rule; 

 The compressed timeline made several agencies, such as NASA, DOT, and USDA

unable to properly review the rule and provide regulatory feedback; 

 The EPA ignored public comments submitted by citizens, and by the states, that probed 

key aspects of the rule;

 Officials underqualified and inexperienced in rulemaking and wetlands issues relative to 

their peers, like Craig Schmauder and Gib Owen, assumed major roles in the WOTUS 

process because they aided in expediting promulgation of the rule;

 The EPA routinely failed to follow the law, including the NEPA, the APA, the RFA and 

SBREFA, and the Anti-Lobbying Act;

 The EPA used science and data to formulate the WOTUS rule that was inconsistent, 

flawed and misapplied, and chose not to address these issues;

 The EPA failed to alter its analysis of the WOTUS rule after significant changes were 

made that rendered previous analysis wholly inconsistent with the new rule for the 

purpose of saving time; 
181

 To keep the rulemaking on schedule, the EPA submitted the rule to OIRA for final 

review before important analyses were completed, preventing full review; and

 The EPA pursued an unprecedented effort to expand its CWA jurisdiction despite these 

shortfalls and in the face of opposition within its own administration.

In an effort to get one of its top policy priorities into effect quickly, the Obama 

Administration sacrificed numerous quality control steps, thus leaving itself vulnerable to 

criticism and perhaps undermining the very goal of protecting America’s water.