Alert

Federal Agencies Unveil Revised WOTUS Rule That May Ease CWA Permitting

December 2, 2025

On November 20, 2025, the U.S. Environmental Protection Agency (EPA) and the U.S. Army Corps of Engineers (Corps) issued a proposed rule to amend the regulatory definition of “waters of the United States” (WOTUS) under the Clean Water Act (CWA), 33 U.S.C. § 1251 et seq. (90 Fed. Reg. 82320, Nov. 20, 2025). The agencies’ proposal responds directly to the U.S. Supreme Court’s 2023 decision in Sackett v. EPA, 598 U.S. 651 (2023), and aims to align federal jurisdiction with the Court’s limitations while reducing ambiguity for regulators and regulated entities.

If finalized, this rule could significantly reduce the number of CWA Section 404 and Section 401 permits required for greenfield and infrastructure development, especially in areas with ephemeral or isolated water features. However, stakeholders should be aware that state-level regulatory responses are likely, particularly in jurisdictions that traditionally exercised broader water protections.

Summary of Key Changes to WOTUS Rule

1. Jurisdictional Waters Re-Defined (40 C.F.R. § 120.2(a))

The proposed rule narrows the WOTUS definition by specifying only two jurisdictional categories:

• Traditional Navigable Waters (TNWs)
• Relatively Permanent Waters and Their Adjacent Wetlands

This excludes several previously jurisdictional features and emphasizes Sackett’s “continuous surface connection” test.

2. “Relatively Permanent” Standard Clarified (§ 120.2(c)(7))

The rule defines “relatively permanent” as surface waters that are standing or continuously flowing year-round or during the “wet season.” The “wet season” is defined as periods when monthly precipitation exceeds evapotranspiration, based on long-term climatic data. Ephemeral streams, by contrast, are excluded under § 120.2(d)(4).

Additionally, such waters must:

• Possess a bed and bank
• Connect to a downstream jurisdictional water via a relatively permanent flow path (§ 120.2(c)(7)(ii))

Tributaries that flow only in response to precipitation events—i.e., ephemeral streams—are no longer jurisdictional.

3. Adjacent Wetlands Must Be Physically and Hydrologically Connected (§ 120.2(c)(8))

Jurisdictional wetlands must:

• Physically abut a jurisdictional water (e.g., TNW or relatively permanent water)
• Have surface water continuously present during the wet season

Critically, the rule clarifies that a wetland separated from jurisdictional waters by discrete features (e.g., levees, berms, or culverts) is not “adjacent” unless surface water is continuously present on both sides during the wet season (§ 120.2(c)(8)(ii)).

4. Elimination of “Interstate Waters” as a Standalone Category

Interstate waters are no longer jurisdictional based solely on their interstate nature. They must independently qualify under the revised categories (§ 120.2(b)(1)).

Expanded and Clarified Exclusions (40 C.F.R. § 120.2(d))

The rule proposes new clarity around exclusions:

• Groundwater is expressly excluded, including tile-drained and subsurface flows (§ 120.2(d)(1))
• Non-navigable ditches constructed entirely in dry land are excluded, even if they eventually convey relatively permanent flow (§ 120.2(d)(3))
• Prior Converted Cropland retains its exemption unless abandoned for >5 years and reverted to a WOTUS-qualifying wetland (§ 120.2(d)(2))
• Waste Treatment Systems are excluded under an expanded definition that includes treatment ponds, lagoons, and infiltration systems (§ 120.2(d)(5))
• Section 404(f) Farming Exemptions remain unchanged, continuing to protect routine agricultural discharges (§ 120.2(f))

Implications for CWA Permitting Programs

CWA Section 404: Fewer Permits, Fewer Delays

By narrowing the scope of WOTUS, the agencies expect a marked reduction in Section 404 permit obligations, particularly for projects involving ephemeral streams and non-abutting wetlands. This is likely to reduce costs, project delays, and National Environmental Policy Act (NEPA) triggers tied to Section 404 actions.

Notably, in arid or semi-arid regions, where ephemeral waters dominate, the proposal could eliminate permitting requirements for many previously regulated features.

CWA Section 401: Reduced Certification Burden

Because Section 401 certifications are contingent on federal permits, the expected decline in Section 404 permits will lead to fewer 401 certification requests. This may reduce administrative workload for state and tribal agencies.

CWA Section 402: Nuanced Impact

Discharges from point sources to waters no longer deemed jurisdictional may no longer require National Pollutant Discharge Elimination System (NPDES) permits. However, permit obligations may persist if pollutants ultimately reach a WOTUS via hydrological or artificial conveyance systems.

State Response and Potential Regulatory Gaps

While the proposed rule reduces federal oversight, it acknowledges that states and tribes may respond by expanding state-level jurisdiction (90 Fed. Reg. at 82325). Currently, at least 24 states regulate waters more broadly than the federal standard, including Washington, Oregon, and California. These states may develop or expand dredge-and-fill programs to fill potential regulatory gaps.

For instance, Washington State has already initiated steps to establish a Section 404 analog at the state level, ensuring continuity in environmental protection despite federal contraction.

What Should Stakeholders Do Now?

Below are key considerations and timely moves that stakeholders may want to discuss with counsel:

1. Map and Assess: Identify and reassess project site water features under the revised definitions.
2. Engage in the Rulemaking: Public comments are due by January 5, 2026, and may be submitted through regulations.gov under Docket ID No. EPA–HQ–OW–2025–0322.
3. Monitor State Responses: Watch for increased state regulation or new permitting schemes in areas where federal oversight is reduced.
4. Consult Experts: Engage environmental counsel or consultants to navigate evolving federal and state requirements and potential NEPA implications.

The EPA and Corps’ proposed WOTUS rule represents a substantial realignment of federal water permitting authority under the CWA. While it is expected to ease permitting burdens and regulatory costs for developers, energy firms, and agricultural stakeholders, it also introduces complexities at the state level that merit close attention.