How Manchin’s Permitting Plan Would Restrict State Power

The odds appear stacked against Sen. Joe Manchin securing the votes needed to pass his controversial federal permitting overhaul for energy projects by attaching it to the spending bill Congress must approve next week to prevent a government shutdown.

But should the centrist Democrat from West Virginia succeed in rallying the support he needs from more than 10 Republicans before a vote planned on Tuesday, the proposal that would then advance out of the Senate would limit what states can consider under the federal Clean Water Act when deciding whether to approve or reject energy projects based on environmental concerns.

Most significantly, experts like Julia Anastasio, executive director of the Association of Clean Water Administrators, said Manchin’s plan would thwart the ability of the Environmental Protection Agency to proceed with a proposal that would restore the power states had before the Trump administration to block energy projects.

This came to light when Manchin made the details of his legislation public on Wednesday, after a leaked summary of the plan circulated for weeks. 

Not revealed in the summary was that Manchin would seek to continue a Trump administration rule limiting states to only considering what a proposed energy project, like a power plant or pipeline, would discharge directly into a body of water when they decide whether to reject or approve such projects under Section 401 of the Clean Water Act.

States would not be able to weigh, as they were able to do until the Trump administration rule change, the “non-water quality impacts” a project would have, including on climate change. 

“It has to do with the scope of a review. Can the state look at the ‘activity as a whole’ of the project and the impact on state water resources when making a certification decision, rather than just looking at the ‘discharge’ associated with a project,” Anastasio said. “The activity as a whole approach gives states an ability to consider a broader suite of impacts.”

Manchin’s proposal specifically says that states would not be able to examine a project’s effects on air quality, even if these were to pose possible risks to water.

“States would not be able to consider impacts of air emissions, period. That would include emissions of mercury even if the mercury eventually ends up in water,” said Patrick Parenteau, a professor and senior fellow for climate policy at the Vermont Law and Graduate School.

Manchin’s plan would also set a two-year limit for federal agencies to permit projects and would require approval of a controversial gas pipeline that would cross his home state.

Democratic Senate Majority Leader Chuck Schumer, of New York, has repeatedly pledged to include Manchin’s proposals in a so-called continuing resolution that would extend federal spending into December and has to be passed by Sept. 30 to prevent a government shutdown. 

Schumer agreed to put the permitting proposal forward in a deal last month to win Manchin’s support for the climate, health care and tax measure, known as the Inflation Reduction Act.

But now, Manchin must gain support from at least 10 Republicans for a continuing resolution that includes his proposal in order to get it through the evenly divided Senate. He will likely need even more GOP backing because several Democrats, including Sen. Tim Kaine of Virginia, and Independent Vermont Sen. Bernie Sanders have voiced opposition to the permitting rewrite. 

By including the approval for the Mountain Valley Pipeline, which would run through Virginia and West Virginia, Manchin did win over his state’s other senator, Republican Shelley Moore Capito. But other Republicans have said they will not go along, in part because they want even bigger permitting changes and because they are upset that Manchin voted to pass the climate law.

Should Manchin’s proposal be approved, it would be the latest turn in a years-long battle over how much permitting authority states should have under the Clean Water Act—a question that has divided the states themselves. Until 2020, states had broad authority to evaluate projects and judge them based on their own laws.

But oil and gas industry groups and states with economies that depend heavily on the sector, as well as coal mining, have argued that other states have misused the power they had under the law to unfairly block major projects.

That changed when the EPA under the Trump administration in 2020 issued new rules that reigned in states’ authority. As a Congressional Research Service report explains, the rule limited states to looking at direct, or “point source”, discharges into certain water, as opposed to considering other factors, like groundwater pollution, erosion and other damage to ecosystems. 

The Trump-era rules also mean climate change would be an out-of-bounds consideration.

These guidelines remained in place even after Biden took office. The U.S. Supreme Court in April reversed a lower court ruling that had blocked the rules.

But the debate took another twist in June, when the EPA under the Biden administration proposed a new rule that would reverse the Trump administration policy. It would restore the ability of states to “holistically evaluate the water quality impacts” of a project.

Now comes Manchin’s proposal, which would put into law the Trump rules for Section 401 of the Clean Water Act and thereby block the EPA’s proposal, which an agency spokesman said is not expected to be made final until next spring.

Even so, Anastasio said her association is not taking a stance on Manchin’s proposal because states are divided over the changes to the water quality law.

Spokespeople for the environmental protection agencies in states that have fought in court over the issue, including Washington, New York, New Mexico, West Virginia and Mississippi, declined to comment on Manchin’s plan.

But in July 2020, officials from 20 states and the District of Columbia filed a federal lawsuit opposing the Trump administration’s rule, saying that it cripples the ability of states to independently review and object to projects that might violate state water quality laws. 

The “arbitrary and capricious” change “upends fifty years of cooperative federalism” and “unlawfully usurps state authority to protect the quality of waters within their borders,” said the court complaint from the officials who brought the case, led by former California Attorney General Xavier Becerra, who is now the U.S. Health and Human Services secretary.

Keeping the Trump administration rules in place is also opposed by environmental groups.

Narrowing reviews to look only at what a project would discharge into bodies of water would mean states would not be able to consider other risk factors, said Adam Carlesco, staff attorney for Food & Water Watch. This includes whether a project could reduce rainfall and, in turn, the flow of waterways, or whether it would hurt wildlife habitat.

However, in 2020 eight Republican states—Arkansas, Louisiana, Mississippi, Missouri, Montana, West Virginia, Wyoming and Texas—argued to the Supreme Court that it should leave the Trump administration rules in place, saying other states had abused the Clean Water Act. 

Those states, the Republican officials argued, “veto projects based on non-water quality considerations, such as preferences regarding energy policy, which infringes on the federal government’s exclusive authority.” One “egregious example” the GOP states cited was Washington state’s 2017 denial of a massive coal export terminal on the Columbia River.