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<br />jurisdiction of FERC, the environmental community wants to amend <br />the bill to make it applicable to all CWA permits. A prior draft <br />of this bill, which came from the environmental community, would <br />have expanded the scope of the 401 certification process from the <br />"discharge of pollutants" to a broader standard of protectin~and <br />improving water quality. S. 106 also attempts to address th~s <br />issue, but does it by amending the Federal Power Act instead of <br />the Clean Water Act. S. 812 may be addressed during the hearings <br />on S. 1081 on July 17 or 18. <br /> <br />4. Section 404 <br /> <br />The debate over the 404 program will have obvious <br />relevance to the development of water projects under state law.!.!1 <br />The existing 404 regulations distinguish between "water <br />dependent" and "non-water dependenV' activities. This <br />distinction is important because it recognizes that, unlike many <br />other proposed uses of wetlands, water projects cannot be built <br />without affecting wetlands, and provides that water dependent <br />activities are not subject to the same presumptions regarding the <br />existence of an alternative site. While the pending proposals to <br />classify wetlands baaed on value have merit, because it is <br />probable that new water projects will be located in streams <br />included within the highest category or value for wetlands, <br />compromises which abandon the water dependent activity <br />distinction and make it easier to develop marginal wetlands in <br />return for more protection for high quality wetlands may <br />ultimately make it harder to develop new water projects, <br />particularly if the "sequencing" requirement of the 1990MOA <br />continues to be enforced.lil <br /> <br />ill Section 404 is not addressed in S. 1081. A number ot 404 <br />bills have been introduced separately, including S. 1463, <br />which is identical to H.R. 1330, and H.R. 251, 404, 13.30 and <br />2400. <br /> <br />111 The 1990 MOA requires the Corps to implement EPA's <br />interpretation of the "sequencing" requirements of the <br />404{b)(1) guidelines. Under tne MOA, an applicant for a 404 <br />permit must first avoid all impacts to wetlands, then <br />mil}imize unavoidable impacts and then mitigate all remaining <br />impacts. Relying on this theory, EPA has successfully <br />asserted in court that an application for a 404 permitfo:ra <br />shopping center can be denied because the developerfai.led <br />to purchase an alternate site which did not have any <br />wetlands, even though the alternate site had s~nce been <br />purchased by a competitor. EPA also asserted in this case <br />that the developer's offer to provide mitigation could be <br />ignored in making the decision to deny the permit, because, <br />under the sequencing requirement, mitigation is only <br />considered after the avoidance and minimization requirements <br />are applied. <br />