Supreme Court Limits EPA Permitting Authority in City and County of San Fran v. US EPA
On March 4, 2025, the U.S. Supreme Court issued a 5-4 opinion in City and County of San Francisco v. Environmental Protection Agency, holding that “end-result” requirements routinely imposed by the EPA in NPDES permits issued to direct dischargers are not authorized by the Clean Water Act. This decision significantly limits the U.S. Environmental Protection Agency’s (EPA) ability under the Clean Water Act (CWA) to issue generalized permit conditions that require the regulated entity to develop the solution for the agency’s desired result. While this will provide more certainty and, in some regards, less regulatory burdens on permit holders, it also raises new challenges.
Background
San Francisco filed suit against the EPA on account of two permit conditions the EPA included in its NPDES renewal permit for its combined wastewater treatment facility, which was issued in 2019. Under the CWA, NPDES permits are required for any entity that wishes to discharge pollutants into “waters of the United States.” 33 USC § 1362(7). These permits contain three categories of requirements: (1) effluent limitations, which are limitations that specify the quantities of pollutants that the permittee is allowed to discharge, (2) narrative limitations, which outline other protective measures permittees must take, such as recordkeeping, sampling, and reporting requirements, and (3) narrative limitations the Supreme Court dubbed “end-result requirements” or “receiving water limitations,” which impose restrictions based on how the discharge will affect the water body it is entering. City of San Francisco v. U.S. Envtl. Prot. Agency, No. 23-753, slip op. at 1-2 (U.S. Mar. 4, 2025); see also 33 U.S.C. § 1311(b).
San Francisco operates a combined sewer system wastewater treatment facility that discharges into the Pacific Ocean. City of San Francisco v. U.S. Envtl. Prot. Agency, 75 F.4th 1074, 1082 (9th Cir. 2023). From 2011 to 2014, this facility discharged 100 million gallons of combined sewage and stormwater into the Pacific Ocean. Between 2004 and 2014, concentrations in the discharges exceeded water quality objectives for various pollutants, including copper and zinc. Id. at 1087-88. As part of its efforts to rectify this ongoing problem, the EPA included two “end-result” limitations in the NPDES renewal permit issued for this facility. One prohibits the facility from “making any discharge that ‘contribute[s] to a violation of any applicable water quality standard’ for receiving waters.” City of San Francisco, No. 23-753, slip op. at 7. The other prohibits the facility from performing any treatment or making any discharge that “create[s] pollution, contamination, or nuisance, as defined by California Water Code section 13050.” Id. at 7.
San Francisco appealed the permit, objecting to the “end-result” limitations, among other things, to the Environmental Appeals Board (EAB), arguing they are inconsistent with the CWA. The EAB upheld the permits, denying San Francisco’s request for review in its entirety, so San Francisco appealed to the Ninth Circuit. City of San Francisco, 75 F.4th at 1088. Finding that the EPA had the authority to impose the two permit conditions at issue under the CWA, the Ninth Circuit upheld the EAB’s findings and denied San Francisco’s petition for review. Id. at 1097. San Francisco then appealed to the U.S. Supreme Court, which granted certiorari to determine whether the EPA can impose “end-result” requirements, like those San Francisco had objected to.
Supreme Court’s Holdings
The Supreme Court held that the EPA did not have the authority to impose end-result requirements to permittees pursuant to the CWA. First, it looked to the text of the CWA. 33 U.S.C. § 1311(b)(1)(C) “requires a permit to contain effluent limitations and ‘any more stringent limitation’ that is ‘necessary to meet’ certain ‘water quality standards’ that are imposed under state law ‘or any other federal law or regulation’ and ‘any more stringent limitation’ that is ‘required to implement any applicable water quality standard established pursuant to this chapter.” City of San Francisco, No. 23-753, slip op. at 10. Focusing on the ordinary meaning of the terms “limitation,” “implement,” and “meet,” the Court found that each of these terms suggests that Congress envisioned the imposition of more concrete limitations that guide the permittee as to what rules they must follow in order to achieve a certain result. Id. at 10-12. Although it recognized that the term “limitation” can be used more broadly to potentially encompass more amorphous “end-result” restrictions, the Court stated that this phrase must be considered within the context of the CWA. In the Court’s view, the narrow meaning of limitation it adopted is more consistent with the meaning of “limitation” as it is used for effluent and narrative limitations. Id. at 11.
Second, the Court reviewed the CWA’s legislative history. It recounted that the CWA’s predecessor, the Water Pollution Control Act (WPCA), had a “backward-looking” approach similar to EPA’s approach in adopting end-result restrictions. Under the WPCA, the EPA was first required to identify a water body with substandard water quality and then work backwards to prove that a specific entity should be held responsible. Id. at 4-5. Those the agency found responsible for violating those water quality standards were then subject to an enforcement action. Id. at 13. This approach was problematic, leading Congress to overhaul the WPCA and create the CWA in 1972. Notably, the Court found that Congress did not elect to keep “any provision authorizing either the United States or any other party to bring suit against an entity whose discharges were contributing to a violation of those standards.” Id. According to the Court, this represents a conscious decision from Congress to move away from the backward-looking approach in favor of “direct restrictions” on polluters, and the EPA’s imposition of end-result restrictions is not in line with this decision.
Third, the Court reviewed the broader statutory scheme of the CWA and found that two aspects of that scheme, the permit shield and the multi-discharger problem, were indications that the EPA could not impose end-result restrictions. The “permit shield” refers to a provision of the CWA that deems all parties compliant with their NPDES permits as compliant with the overall Act. Id. at 5. This is an extremely important provision for permittees on account of the high penalties the EPA may impose for violations of the CWA. However, the Court found that this protection is virtually meaningless when end-result restrictions are imposed because permittees can do everything right under their permit, but still face penalties due to someone else’s acts that reduce the water quality in the receiving water body. Id. at 15. Relatedly, the multi-discharger problem refers to a situation where multiple permit holders are discharging into a water body with substandard water quality. This was an issue under the WPCA’s backward-looking approach. As such, the Court found it difficult to believe Congress would have utilized this approach again without solving this fundamental problem. Id. at 15-16.
Considering each of these factors, the Court determined that the EPA lacked the authority to impose end-use restrictions under the CWA.
Practical Implications
The Court’s holding in The City of San Francisco will no doubt reshape the way the EPA and its state counterparts administer the CWA and structure NPDES permits. It will require the EPA to issue more definitive requirements for permittees, which will likely lessen the regulatory burden on permit holders that are no longer required to undertake investigations and design plans that will ensure the end-result requirements are met. It will also provide more certainty to regulated entities regarding exactly what their permit conditions require.
That being said, it may also lead to the EPA requesting more information from an applicant upfront (e.g., in the permit application) because it now falls on the federal or state agency to impose concrete measures to ensure their desired water quality standards are met. This is an often complex determination and requires deep knowledge of a facility, which the agency typically relies on the permittee to provide. As such, it is likely that the EPA will rely on significant information sharing with the permittee to investigate issues and determine the best route to achieve its desired outcome. Relatedly, the Court’s holding is also likely to result in increased processing times for permit issuances and renewals, as now the agency must first become an expert on the regulated facility, determine the potential causes of ongoing issues, and develop concrete measures to fix those issues. Finally, as the dissenters point out, this holding will make it more difficult for the EPA to issue general NPDES permits. City of San Francisco, No. 23-753, slip op. at 13 (Barrett, J., dissenting). General NPDES permits are typically issued to certain industries and smaller entities, such as wastewater treatment plants, that may have trouble complying with more individualized NPDES permit restrictions. Accordingly, for those entities eligible for general NPDES permits, the Court’s holding may actually increase the regulatory burden.
