Despite a December court ruling that threw out the largest wetland fine levied in the nation’s history, the U.S. Army Corps of Engineers and the EPA have concluded that they still have ample authority to regulate “isolated” wetlands in the Bay region.

A recent memorandum advised Corps and EPA staff that they “should make it clear to members of the regulated public” that the agencies will continue to “assert jurisdiction over isolated waterbodies, including isolated wetlands.”

The official guidance issued to the staffs of the two agencies was in response to a Dec. 23 decision by the Fourth Circuit of the U.S. Court of Appeals which said the Corps had exceeded its authority by regulating what the court construed to be isolated, intrastate wetlands at a 10,000-home, planned community being developed in Maryland’s Charles County. [See “Ruling puts some wetlands on shaky ground,” Bay Journal, March 1998.]

Developer James Wilson and two companies that he controlled were fined $4 million in 1996 for filling 50 acres of wetlands at the site. At that time, it was the largest-ever judgment for wetlands destruction under the Clean Water Act.

But in a 2-1 decision, the appeals court ruled that the regulation was “invalid” because the wetlands were not waters of the United States as defined by the Clean Water Act. Specifically, the court cited the fact that the wetlands were not directly connected to any navigable waterway used in interstate or foreign commerce.

The ruling raised broad concerns that it would dramatically reduce the federal government’s ability to regulate thousands of acres of isolated wetlands within the Fourth Circuit, which includes Maryland, Virginia, West Virginia, North Carolina and South Carolina.

Within the Bay watershed, the ruling had raised particular concerns about wetlands in Virginia. While Maryland has a state program to that could continue to regulate wetlands affected by the ruling, almost all nontidal wetland regulation in Virginia is done by the federal government.

The new guidance, issued in early June, said links between isolated wetlands and navigable waterbodies can be established through other means under the Clean Water Act.

For example, if a direct water connection to a waterbody used in interstate or foreign commerce cannot be made, the guidance said isolated wetlands could be protected if it could be shown that individually or “in the aggregate” their loss would affect interstate or foreign commerce because they are used by migratory waterfowl or game birds sought by hunters and photographers or protected by international treaty.

Other grounds that could be cited were the use of such wetlands by fish or shellfish used in interstate commerce; their use by industries operating in interstate or foreign commerce; or their recreational use by foreign or interstate travelers.

The guidance says that the agencies will be documenting information about the full range of effects of the loss and destruction of isolated wetlands to “document that, in the aggregate, the use, degradation or destruction of isolated water bodies would have substantial effects on interstate or foreign commerce.”

Based on that, the guidance indicates the agencies will propose a new, enforceable regulation that deals with the issues in the case.

Roy Hoagland, an attorney with the Chesapeake Bay Foundation, said the guidance will help clarify the issue, but questions raised by the court ruling won’t go away until the new regulation dealing with isolated wetlands is finalized.

“The Corps is taking the right steps, they’re doing the right thing, but it is an interim step, it is not the final fix,” Hoagland said.

Until an enforceable rule is in effect, he said the Wilson decision creates enough uncertainty that it will continue to spur legal challenges to wetland regulatory efforts in the region. “You’re going to have the opportunity for lots of case-by-case challenges,” Hoagland said.

Already, he said, questions raised by the Wilson decision had led to at least one court case challenging a wetland permit decision in Virginia.

“They can, through regulation, make a decision that as a class, these resources have an effect on interstate commerce, so you don’t need to show that each one does or could have an effect,” Hoagland said. “If you consider isolated wetlands in the aggregate, they can overcome that regulatory issue.”