[Federal Register Volume 81, Number 94 (Monday, May 16, 2016)]
[Rules and Regulations]
[Pages 30183-30198]
[FR Doc No: 2016-11511]

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ENVIRONMENTAL PROTECTION AGENCY

40 CFR Parts 123, 131, 233 and 501

[EPA-HQ-OW-2014-0461; FRL-9946-33-OW]

Revised Interpretation of Clean Water Act Tribal Provision

AGENCY: Environmental Protection Agency (EPA).

ACTION: Final interpretive rule.

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SUMMARY: Section 518 of the Clean Water Act (CWA), enacted as part of
the 1987 amendments to the statute, authorizes EPA to treat eligible
Indian tribes with reservations in a manner similar to states (TAS) for
a variety of purposes, including administering each of the principal
CWA regulatory programs and receiving grants under several CWA
authorities. Since 1991, EPA has followed a cautious interpretation
that has required tribes, as a condition of receiving TAS regulatory
authority under section 518, to demonstrate inherent authority to
regulate waters and activities on their reservations under principles
of federal Indian common law. The Agency has consistently stated,
however, that its approach was subject to change in the event of
further congressional or judicial guidance addressing tribal authority
under CWA section 518. Based on such guidance, EPA in the interpretive
rule we are finalizing today concludes definitively that section 518
includes an express delegation of authority by Congress to Indian
tribes to administer regulatory programs over their entire
reservations, subject to the eligibility requirements in section 518.
This reinterpretation streamlines the process for applying for TAS,
eliminating the need for applicant tribes to demonstrate inherent
authority to regulate under the Act and allowing eligible tribes to
implement the congressional delegation of authority. The
reinterpretation also brings EPA's treatment of tribes under the CWA in
line with EPA's treatment of tribes under the Clean Air Act, which has
similar statutory language addressing tribal regulation of Indian
reservation areas. This interpretive rule

does not revise any regulatory text. Regulatory provisions remain in
effect requiring tribes to identify the boundaries of the reservation
areas over which they seek to exercise authority and allowing the
adjacent state(s) to comment to EPA on an applicant tribe's assertion
of authority. This rule will reduce burdens on applicants associated
with the existing TAS process and has no significant cost.

DATES: This final interpretive rule is effective on May 16, 2016.

ADDRESSES: EPA has established a docket for this rule under Docket ID
No. EPA-HQ-OW-2014-0461. All documents in the docket are listed on the
http://www.regulations.gov Web site.

FOR FURTHER INFORMATION CONTACT: Thomas Gardner, Standards and Health
Protection Division, Office of Science and Technology (4305T),
Environmental Protection Agency, 1200 Pennsylvania Ave. NW.,
Washington, DC 20460; telephone number:<PHONE_NUMBER>; email address:
<EMAIL_ADDRESS>
SUPPLEMENTARY INFORMATION: This supplementary information section is
organized as follows:

I. General Information
    A. Does this interpretive rule apply to me?
    B. What interpretation is the Agency making?
    C. How was this rule developed?
    D. What is the Agency's authority for issuing this
reinterpretation?
    E. What are the incremental costs and benefits of this
interpretive rule?
    F. Judicial Review
II. Background
    A. Statutory History
    B. Regulatory History
III. How did EPA interpret the CWA TAS provision in 1991 when
establishing TAS regulations for CWA regulatory programs?
IV. What developments support EPA's revised statutory
interpretation?
    A. Relevant Congressional, Judicial and Administrative
Developments
    B. EPA and Tribal Experience in Processing TAS Applications for
CWA Regulatory Programs
V. EPA's Revised Statutory Interpretation
    A. What does today's reinterpretation provide and why?
    B. What other approaches did EPA consider?
    C. What is EPA's position on certain public comments and tribal
and state stakeholder input?
    1. Geographic Scope of TAS for Regulatory Programs
    2. Treatment of Tribal Trust Lands
    3. Tribal Criminal Enforcement Authority
    4. Special Circumstances
    5. Tribal Inherent Regulatory Authority
    6. Existing Regulatory Requirements
    a. TAS Requirements
    b. Relationship to Program Approvals
    7. Effects on New Tribal TAS Applications
    8. Effects on EPA-Approved State Programs
VI. How does the rule affect existing EPA guidance to tribes seeking
to administer CWA regulatory programs?
VII. Economic Analysis
VIII. Statutory and Executive Order Reviews
    A. Executive Order 12866: Regulatory Planning and Review and
Executive Order 13563: Improving Regulation and Regulatory Review
    B. Paperwork Reduction Act (PRA)
    C. Regulatory Flexibility Act (RFA)
    D. Unfunded Mandates Reform Act (UMRA)
    E. Executive Order 13132: Federalism
    F. Executive Order 13175: Consultation and Coordination With
Indian Tribal Governments
    G. Executive Order 13045: Protection of Children From
Environmental Health Risks and Safety Risks
    H. Executive Order 13211: Actions Concerning Regulations That
Significantly Affect Energy Supply, Distribution, or Use
    I. National Technology Transfer and Advancement Act (NTTAA)
    J. Executive Order 12898: Federal Actions To Address
Environmental Justice in Minority Populations and Low-Income
Populations
    K. Congressional Review Act (CRA)

I. General Information

A. Does this interpretive rule apply to me?

    This rule applies to tribal governments that seek eligibility to
administer regulatory programs under the Clean Water Act (CWA, or the
Act). The table below provides examples of entities that could be
affected by this rule or have an interest in it.

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                                     Examples of potentially affected or
             Category                        interested entities
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Tribes............................  Federally recognized tribes with
                                     reservations that could potentially
                                     seek eligibility to administer CWA
                                     regulatory programs, and other
                                     interested tribes.
States............................  States adjacent to potential
                                     applicant tribes.
Industry..........................  Industries discharging pollutants to
                                     waters within or adjacent to
                                     reservations of potential applicant
                                     tribes.
Municipalities....................  Publicly owned treatment works or
                                     other facilities discharging
                                     pollutants to waters within or
                                     adjacent to reservations of
                                     potential applicant tribes.
------------------------------------------------------------------------

    If you have questions regarding the effect of this interpretive
rule on a particular entity, please consult the person listed in the
preceding FOR FURTHER INFORMATION CONTACT section.

B. What interpretation is the Agency making?

    Today's interpretive rule streamlines how tribes apply for TAS
under CWA section 518 for CWA regulatory programs including the water
quality standards program. It eliminates the need for applicant tribes
to demonstrate inherent authority to regulate under the Act, thus
allowing tribes to implement a delegation of authority by Congress.
Specifically, EPA revises its existing interpretation of CWA section
518 to conclude definitively that this provision includes an express
delegation of authority by Congress to Indian tribes to administer
regulatory programs over their entire reservations, subject to the
eligibility requirements in section 518.

C. How was this rule developed?

    EPA conducted consultation and coordination with tribes and states
before proposing the reinterpretation in the Federal Register on August
7, 2015. See 80 FR 47430 (August 7, 2015) (``proposed rule,'' ``EPA's
proposal,'' ``proposed reinterpretation''), available in the docket for
this rule. During the 60-day public comment period, EPA provided
informational webinars for the public and conducted further
consultation and coordination with tribes and states.
    EPA received a total of 44 comments from the public on the proposed
interpretive rule. A majority (27) of the comments expressed support
for the rule, including unanimous support from tribes and tribal
organizations that responded. Sections IV and V address issues and
questions about the proposal that commenters raised.
    Today's rule finalizes the proposal, reflecting EPA's consideration
of the comments and other input received. The comments, EPA's responses
to the comments, and meeting notes are available in the public docket
at http://www.regulations.gov.

D. What is the Agency's authority for issuing this reinterpretation?

    The CWA, 33 U.S.C. 1251, et seq., including section 518 (33 U.S.C.
1377).

E. What are the incremental costs and benefits of this interpretive
rule?

    This rule entails no significant cost. Its only effect will be to
reduce the administrative burden for a tribe applying in the future to
administer a CWA regulatory program, and to potentially increase the
pace at which tribes seek such programs. See the discussion of
administrative burden and cost in sections VII and VIII.B.

F. Judicial Review

    This interpretive rule, which sets forth EPA's revised
interpretation of CWA section 518, is not a final agency action subject
to immediate judicial review. This interpretive rule is not
determinative of any tribe's eligibility for TAS status. Rather, it
notifies prospective applicant Indian tribes and others of EPA's
revised interpretation. Today's interpretive rule would be subject to
judicial review only in the context of a final action by EPA on a TAS
application from an Indian tribe for the purpose of administering a CWA
regulatory program based on the revised interpretation.

II. Background

A. Statutory History

    Congress added CWA section 518 as part of amendments made to the
statute in 1987. Section 518(e) authorizes EPA to treat eligible Indian
tribes in a similar manner as states for a variety of purposes,
including administering each of the principal CWA regulatory programs
and receiving grants under several CWA funding authorities. Section
518(e) is commonly known as the ``TAS'' provision, for treatment in a
manner similar to a state.
    Section 518(e) establishes eligibility criteria for TAS, including
requirements that the tribe have a governing body carrying out
substantial governmental duties and powers; that the functions to be
exercised by the tribe pertain to the management and protection of
water resources within the borders of an Indian reservation; and that
the tribe be reasonably expected to be capable of carrying out the
functions to be exercised in a manner consistent with the terms and
purposes of the Act and applicable regulations. Section 518(e) also
requires EPA to promulgate regulations specifying the TAS process for
applicant tribes. See section II.B.
    Section 518(h) defines ``Indian tribe'' to mean any Indian tribe,
band, group, or community recognized by the Secretary of the Interior
and exercising governmental authority over a federal Indian
reservation. It also defines ``federal Indian reservation'' to mean all
land within the limits of any reservation under the jurisdiction of the
United States Government, notwithstanding the issuance of any patent,
and including rights-of-way running through the reservation.

B. Regulatory History

    Pursuant to section 518(e), EPA promulgated several final
regulations establishing TAS criteria and procedures for Indian tribes
interested in administering programs under the Act. The relevant
regulations addressing TAS requirements for the principal CWA
regulatory programs are: \1\
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    \1\ In early 2016 EPA proposed to add criteria and procedures
for tribes to obtain TAS to administer the CWA Section 303(d)
Impaired Water Listing and Total Maximum Daily Load (TMDL) Program.
80 FR 2791, Jan. 19, 2016. The proposal has not yet been finalized
and thus is not in effect at this time.
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     40 CFR 131.8 for section 303(c) water quality standards
(WQS). Final rule published December 12, 1991 (56 FR 64876); proposed
rule published September 22, 1989 (54 FR 39098). Referred to hereafter
as the ``1991 WQS TAS rule'' or ``1991 TAS rule'';
     40 CFR 131.4(c) for section 401 water quality
certification, published in the 1991 WQS TAS rule;
     40 CFR 123.31-123.34 for section 402 National Pollutant
Discharge Elimination System (NPDES) permitting and other provisions,
and 40 CFR 501.22-501.25 for the state section 405 sewage sludge
management program. Final rule published December 22, 1993 (58 FR
67966); proposed rule published March 10, 1992 (57 FR 8522); and
     40 CFR 233.60-233.62 for section 404 dredge or fill
permitting. Final rule published February 11, 1993 (58 FR 8172);
proposed rule published November 29, 1989 (54 FR 49180).
    In 1994, EPA amended the above regulations to simplify the TAS
process and eliminate unnecessary and duplicative procedural
requirements. See 59 FR 64339 (December 14, 1994) (the ``Simplification
Rule''). For example, the Simplification Rule eliminated the need for a
tribe to prequalify for TAS before applying for sections 402, 404 and
405 permitting programs. Instead, the rule provided that a tribe would
establish its TAS eligibility at the program approval stage, subject to
EPA's notice and comment procedures already established for state
program approvals in 40 CFR parts 123 and 233. The rule retained the
prequalification requirements (including local notice and comment
procedures) for section 303(c) WQS and section 401 water quality
certifications. Id.; see also, 40 CFR 131.8(c)(2), (3).\2\ The TAS
regulations for CWA regulatory programs have remained intact since
promulgation of the Simplification Rule.
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    \2\ Under the CWA and EPA's regulations, tribes can apply for
TAS under CWA section 518 for the purpose of administering WQS and
simultaneously submit actual standards for EPA review under section
303(c). Although they can proceed together, a determination of TAS
eligibility and an approval of actual water quality standards are
two distinct actions.
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    Today's interpretive rule does not address or affect the TAS
requirements or review process for tribes to receive grants.\3\ The
receipt of grant funding does not involve any exercise of regulatory
authority. Therefore, a determination of TAS eligibility solely for
funding purposes does not, under existing regulations, require an
analysis or determination regarding an applicant tribe's regulatory
authority.
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    \3\ EPA has promulgated regulations governing the TAS
application and review requirements for CWA grant funding programs.
See, e.g., 40 CFR 35.580-588 (CWA section 106 water pollution
control funding); 40 CFR 35.600-615 (CWA section 104 water quality
cooperative agreements and wetlands development funding); 40 CFR
35.630-638 (CWA section 319 nonpoint source management grants).
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III. How did EPA interpret the CWA TAS provision in 1991 when
establishing TAS regulations for CWA regulatory programs?

    The TAS eligibility criteria in section 518(e) make no reference to
any demonstration of an applicant tribe's regulatory authority to
obtain TAS. Rather, the relevant part of section 518(e)--which is
section 518(e)(2)--requires only that the functions to be exercised by
the tribe pertain to the management and protection of reservation water
resources. As noted above, section 518(h)(1) also defines Indian
reservations to include all reservation land irrespective of who owns
the land. EPA nonetheless took a cautious approach when it issued the
1991 WQS TAS rule and subsequent regulations described in section II.B
above. The 1991 approach required each tribe seeking TAS for the
purpose of administering a CWA regulatory program to demonstrate its
inherent authority under principles of federal Indian law, including
gathering and analyzing factual information to demonstrate the tribe's
inherent authority over the activities of nonmembers of the tribe on
nonmember-owned fee lands within a reservation.\4\
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    \4\ Under principles of federal Indian law, demonstrations of
inherent tribal authority over such non-member activities are guided
by the principles expressed in Montana v. United States, 450 U.S.
544 (1981), and its progeny.

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    EPA recognized at the time that there was significant support for
the proposition that Congress had intended to delegate authority to
otherwise eligible tribes to regulate their entire reservations under
the Act. Notably, in a plurality opinion in Brendale v. Confederated
Tribes and Bands of the Yakima Nation, 492 U.S. 408 (1989), Justice
White had even cited section 518 as an example of a congressional
delegation of authority to Indian tribes.\5\ EPA also stated the
Agency's interpretation that in section 518, Congress had expressed a
preference for tribal regulation of surface water quality on
reservations to assure compliance with the goals of the CWA. 56 FR at
64878-79. Nonetheless, in an abundance of caution, EPA opted at the
time to require tribes to demonstrate, on a case-by-case basis, their
inherent jurisdiction to regulate under the CWA. EPA was clear,
however, that this approach was subject to change in light of further
judicial or congressional guidance. Id.
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    \5\ Brendale v. Confederated Tribes and Bands of the Yakima
Nation, 492 U.S. 408, 428 (1989). Although highly instructive, EPA
recognized that the statement regarding section 518 was not
necessary to the plurality's decision. See 56 FR at 64880. The five
Justices not joining Justice White's opinion did not discuss the CWA
provision.
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    For further details about EPA's 1991 interpretation of the CWA TAS
provision, see section III of EPA's proposal. 80 FR at 47433-34.

IV. What developments support EPA's revised statutory interpretation?

A. Relevant Congressional, Judicial and Administrative Developments

    Since 1991, EPA has taken final action approving TAS for CWA
regulatory programs for 53 tribes.\6\ Three of those decisions were
challenged in judicial actions. The last challenge concluded in 2002.
In each of the cases, the reviewing court upheld EPA's determination
with respect to the applicant tribe's inherent authority to regulate
under the CWA. Wisconsin v. EPA, Case No. 96-C-90 (E.D. Wis. 1999),
aff'd, 266 F.3d 741 (7th Cir. 2001), cert. denied, 535 U.S. 1121 (2002)
(Sokaogon Chippewa Community); Montana v. EPA, 941 F. Supp. 945 (D.
Mont. 1996), aff'd, 137 F.3d 1135 (9th Cir.), cert. denied, 525 U.S.
921 (1998) (Confederated Salish and Kootenai Tribes of the Flathead
Reservation); Montana v. EPA, 141 F.Supp.2d 1259 (D. Mont. 1998)
(Assiniboine and Sioux Tribes of the Fort Peck Reservation).\7\
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    \6\ The site http://www.epa.gov/wqs-tech/epa-approvals-tribal-water-quality-standards provides a list of tribes with TAS
eligibility for the section 303(c) water quality standards and
section 401 water quality certification programs. To date, EPA has
not approved TAS for any tribe for CWA section 402 or section 404
permitting.
    \7\ EPA was also upheld in the only case challenging the
Agency's approval of actual tribal water quality standards under CWA
section 303(c) (which is a distinct action from EPA's approval of
tribal TAS eligibility under section 518). City of Albuquerque v.
Browner, 97 F.3d 415 (10th Cir. 1996), cert. denied, 522 U.S. 965
(1997) (water quality standards of Isleta Pueblo).
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    Notably, the first court to review a challenge to an EPA CWA TAS
approval expressed the view that the statutory language of section 518
indicated plainly that Congress intended to delegate authority to
Indian tribes to regulate water resources on their entire reservations,
including regulation of non-Indians on fee lands within a reservation.
Montana v. EPA, 941 F. Supp. at 951-52. In that case, the applicant
tribe, participating as amicus, argued that the definition of ``Federal
Indian reservation'' in CWA section 518(h)(1)--which expressly includes
all land within the limits of a reservation notwithstanding the
issuance of any patent--combined with the bare requirement of section
518(e) that the functions to be exercised by the applicant tribe
pertain to reservation water resources, demonstrates that section 518
provides tribes with delegated regulatory authority over their entire
reservations, including over non-Indian reservation lands. Id. Because
EPA had premised its approval of the TAS application at issue upon a
showing of tribal inherent authority, it was unnecessary for the
district court to reach the delegation issue as part of its holding in
the case. Nonetheless, the court readily acknowledged that section 518
is properly interpreted as an express congressional delegation of
authority to Indian tribes over their entire reservations. The court
noted that the legislative history might be ambiguous, although only
tangentially so, since the bulk of the legislative history relates to
the entirely separate issue of whether section 518(e) pertains to non-
Indian water quantity rights, which it does not. Id. The court observed
the established principle that Congress may delegate authority to
Indian tribes--per United States v. Mazurie, 419 U.S. 544 (1975)--and
commented favorably on Justice White's statement regarding section 518
in Brendale. Id. The court also noted that a congressional delegation
of authority to tribes over their entire reservations ``comports with
common sense'' to avoid a result where an interspersed mixing of tribal
and state WQS could apply on a reservation depending on whether the
waters traverse or bound tribal or non-Indian reservation land. Id.
Having thus analyzed CWA section 518, the court concluded--albeit in
dicta--that Congress had intended to delegate such authority to Indian
tribes over their entire reservations.
    The TAS provision of a separate statute--the Clean Air Act (CAA)--
and the review of that provision in court provide additional relevant
guidance (both congressional and judicial) regarding legislative intent
to treat Indian reservations holistically for purposes of environmental
regulation by delegating authority over such areas to eligible Indian
tribes. Congress added the CAA TAS provision--section 301(d)--to the
statute in 1990, only three years after it enacted CWA section 518.
Although CAA section 301(d) pre-dates EPA's 1991 CWA TAS rule, it was
not until 1998 that EPA promulgated its regulations interpreting the
CAA TAS provision as an express congressional delegation of authority
to eligible Indian tribes. 40 CFR part 49; 63 FR 7254 (February 12,
1998) (the ``CAA Tribal Authority Rule''). The U.S. Court of Appeals
for the D.C. Circuit upheld that interpretation two years later.
Arizona Public Service Co. v. EPA, 211 F.3d 1280 (D.C. Circuit 2000)
(``APS''), cert. denied, 532 U.S. 970 (2001). As described below, in
the preamble to the CAA Tribal Authority Rule and in APS, EPA and the
D.C. Circuit considered significant similarities between the CWA and
CAA tribal provisions. With the benefit of the court's careful review
in APS, EPA believes that enactment of the CAA TAS provision in 1990
provides useful guidance from Congress regarding its similar intent in
1987 to provide for uniform tribal regulation of mobile environmental
pollutants within reservations. Relevant aspects and treatment of the
CAA TAS provision are described below.
    EPA finalized its regulations implementing CAA section 301(d) in
1998. The CAA TAS provision, combined with the definition of Indian
tribe in CAA section 302(r), established the same basic TAS eligibility
criteria for CAA purposes that apply under the CWA: i.e., federal
recognition, tribal government carrying out substantial duties and
powers, jurisdiction, and capability. With regard to jurisdiction, EPA
carefully analyzed the language and legislative history of the relevant
portion of the CAA TAS provision, CAA section 301(d)(2)(B), and
concluded that Congress had intended to delegate authority to eligible
Indian tribes to administer CAA regulatory programs over their entire
reservations irrespective of land ownership--e.g., including over
nonmember fee lands within the reservation. 63 FR at 7254-

57. EPA determined that the language of the provision distinguished
between reservation and non-reservation areas over which tribes could
seek TAS eligibility and plainly indicated Congress' intent that
reservations will be under tribal jurisdiction. Id. By contrast, for
non-reservation areas, tribes would need to demonstrate their inherent
authority to regulate under principles of federal Indian law. Id.
    EPA noted at that time important similarities between the CAA and
CWA TAS provisions. Most notably, the tribal provisions of both
statutes expressly provide eligibility for tribal programs that pertain
to the management and protection of environmental resources (i.e., air
and water, respectively) located on Indian reservations. Id. at 7256.
For instance, CAA section 301(d) provides for tribal regulation of air
resources ``within the exterior boundaries of the reservation'' without
any requirement for a demonstration by applicant tribes of separate
authority over such reservation areas. CAA section 301(d)(2)(B).
Similarly, CWA section 518 provides eligibility for tribal programs
covering water resources ``within the borders of an Indian
reservation'' and expressly defines Indian reservations to include all
land within the reservation notwithstanding the issuance of any patent
and including rights-of-way. CWA sections 518(e)(2), (h)(1). By their
plain terms, both statutes thus treat reservation lands and resources
the same way and set such areas aside for tribal programs. At the time
EPA promulgated the CAA Tribal Authority Rule, however, EPA viewed the
CAA--which also contained other provisions addressing tribal roles--and
its legislative history as more conclusively demonstrating
congressional intent to delegate authority to eligible tribes over
their reservations. Id. EPA recognized that this resulted in different
approaches to two similar TAS provisions and reiterated that the
question remained open as to whether the CWA provision is also an
express delegation of authority to eligible tribes. Id. EPA also cited
to the district court decision in Montana v. EPA, which, as noted
above, concluded that CWA section 518 plainly appears to delegate such
authority to Indian tribes. Id.
    Several parties petitioned for judicial review of the CAA Tribal
Authority Rule and challenged whether CAA section 301(d) could be
properly interpreted as a delegation of authority by Congress to
eligible Indian tribes. APS, 211 F.3d at 1287-92. The D.C. Circuit
carefully analyzed CAA section 301(d), the relevant legislative
history, and the judicial precedent on delegations of authority to
Indian tribes and concluded that EPA's interpretation comported with
congressional intent. Id. The court acknowledged the similarities
between the CAA and CWA TAS provisions, as well as EPA's different
approach under the CWA. Id. at 1291-92. However, the court also noted
with significance that EPA's approach under the CWA had not been
subjected to judicial review and observed favorably the district
court's statements in Montana v. EPA that section 518 plainly indicates
congressional intent to delegate authority to Indian tribes. Id.
Ultimately, the D.C. Circuit recognized that EPA had taken a cautious
approach under the CWA but that there was no reason EPA must do so
again under the CAA. Id.
    A dissenting judge in the APS case disagreed that CAA section
301(d)(2)(B) expressed congressional intent to delegate authority to
tribes over their reservations. Id. at 1301-05. Notably, the dissent's
view was predicated largely on the absence in section 301(d)(2)(B) of
language explicitly describing the reservation areas over which tribes
would exercise CAA jurisdiction as including all reservation lands
notwithstanding the issuance of any patent and including rights-of-way
running through the reservation (emphasis added). Id. The dissent
viewed this language as critical to an expression of congressional
intent that tribes are to exercise delegated authority over all
reservation lands, including lands owned by nonmembers of the tribes.
Id. And in the absence of such language--which the dissent referred to
as ``the gold standard for such delegations''--the dissent did not view
CAA section 301(d)(2)(B) as expressing Congress' intent to relieve
tribes of the need to demonstrate their inherent authority to regulate
under the CAA, including a demonstration of inherent authority over
nonmember activities on fee lands under the Supreme Court's Montana
test. Id. at 1303-04.\8\ Notably, the dissent observed that the key
``notwithstanding'' language is, in fact, included in the relevant
tribal provisions of the CWA--i.e., in the definition of ``federal
Indian reservation'' in CWA section 518(h)(1). Id. at 1302 (referencing
Brendale, 492 U.S. at 428). The dissent noted that in spite of the
statement in Brendale, EPA had determined not to treat CWA section 518
as a congressional delegation; however, the dissent also observed that
no court had yet resolved the issue. Id.
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    \8\ The dissent in APS also concluded that a separate provision
of the CAA--section 110(o)--expressly delegates authority to
eligible Indian tribes over their entire reservations for the
specific CAA program addressed in that provision. Id. at 1301-02.
Section 110(o) includes the key language cited by the dissent as
indicative of express congressional delegations of authority to
tribes over their reservations. Id.
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    As the D.C. Circuit stated in APS, no court has yet reviewed EPA's
interpretation of tribal regulation under the CWA on the question of
whether CWA section 518 constitutes an express delegation of authority
from Congress to eligible Indian tribes to regulate water resources
throughout their reservations. Importantly, members of the three courts
that have considered the issue have favorably viewed such an
interpretation: The U.S. Supreme Court in Brendale, the federal
district court in Montana v. EPA, and the D.C. Circuit in APS.
    In light of these developments, as well as EPA's experience
administratively interpreting and implementing the CAA TAS provision,
it is appropriate to revisit and revise EPA's approach to TAS under the
CWA. In the preambles to the CWA TAS regulations from the 1990s, EPA
discussed the possibility of reinterpreting CWA section 518 as an
express congressional delegation of authority to tribes based on
subsequent congressional or judicial guidance. Additionally, in 2011
EPA discussed the possible reinterpretation of section 518 in a review
of EPA's legal authorities that could help advance environmental
justice.\9\ Today's rule accomplishes such a reinterpretation.
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    \9\ Plan EJ 2014: Legal Tools, Office of General Counsel, EPA,
December 2011. See http://www3.epa.gov/environmentaljustice/plan-ej/index.html.
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Consideration of Comments
    EPA received numerous comments on the proposed rule addressing the
Agency's rationale for revising its interpretation of section 518. All
eighteen Indian tribes and the three tribal organizations that
commented expressed strong support for the rule. Two states also
expressed support for tribal opportunities to obtain TAS. Several
members of the public also supported the rule, including a member of
the Indian law academic community. Supportive commenters agreed that
the plain language of section 518 indicates Congress' intent to
delegate authority to tribes to regulate their entire reservations
under the CWA and that the cited case law developments provide
additional support for the revised interpretation and a solid basis for
EPA to finalize the rule. Commenters noted the similarities between the
CWA

and CAA tribal provisions and supported EPA's effort to harmonize the
treatment of Indian reservations under both statutes. Some comments
asserted that EPA should have treated section 518 as a congressional
delegation all along and argued that requiring tribes to demonstrate
inherent authority to regulate under the CWA had imposed requirements
not included in the statute and may have exceeded EPA's authority. EPA
appreciates the commenters' support for the rule.
    EPA also received comments from several other states, a local
government, a local government association, two operating agents of
industrial facilities, and one member of the public disagreeing with,
or questioning, in whole or in part EPA's rationale for the revised
interpretation of section 518. These comments assert that EPA's legal
analysis does not support the change in statutory interpretation; that
there has been no definitive court ruling on the proper interpretation
of section 518; and that the judicial statements regarding section 518
that EPA cited in the proposal represent dicta and not actual court
holdings on the CWA question. The comments also argue that the relevant
CWA legislative history does not support the revised interpretation and
note that Congress has been aware of EPA's prior interpretation since
1991 but has taken no action to correct it, notwithstanding that
Congress amended section 518 in 2000. Commenters also point to a
backdrop of U.S. Supreme Court case law addressing limitations on
inherent tribal authority with regard to the activities of non-tribal
members and assert that the revised interpretation would run counter to
that line of jurisprudence. The comments also assert that differences
between the CWA and CAA and between water and air quality issues
support treating reservations differently under the two statutes.
    EPA appreciates but disagrees with these comments. EPA recognizes
that the various judicial statements supporting the Agency's
interpretation of section 518 as a congressional delegation were not
central to the holdings of the relevant cases. This is not surprising
in light of the fact that EPA has not previously approved a TAS
application based on this interpretation of section 518. Because EPA
has premised its prior TAS approvals on demonstrations of inherent
tribal regulatory authority, there would be no opportunity in the
ordinary course of judicial review to join the open question regarding
the proper interpretation of the statute. Nonetheless, the commenters
undervalue the significance of the cited judicial statements. For
instance, although the district court in Montana v. EPA did not need to
decide the issue to uphold EPA's approval of the Salish and Kootenai
Tribes' TAS application, the question of whether section 518 delegates
authority to tribes was squarely presented and subjected to the court's
careful analysis. The court reviewed the statutory language and
legislative history and clearly articulated its view (albeit not its
holding) that section 518 is properly interpreted as a delegation of
authority to tribes. The D.C. Circuit also expressly considered section
518 during its review of the CAA tribal provision in APS, with the
dissenting judge going so far as to cite the CWA as including the gold
standard of statutory language to delegate authority to tribes over
their reservations. EPA continues to view these statements as
significant judicial guidance. EPA also continues to view the reference
to section 518 in Justice White's opinion in Brendale as an important
observation from the highest federal court that the CWA reflects
congressional intent to delegate authority to tribes. EPA recognizes
that the reference was not necessary to the plurality's opinion and
that the opinion does not include an analysis of section 518. For these
and other reasons, EPA opted to proceed cautiously in 1991 and await
further guidance. But EPA's deliberate approach in no way discounts or
diminishes the value of Justice White's statement toward a proper
interpretation of section 518. Viewed as a whole, the various judicial
statements regarding section 518 provide ample support for EPA's
revised interpretation.
    EPA is also aware of the separate Supreme Court jurisprudence
addressing inherent tribal authority over nonmembers on Indian
reservations. This is, of course, the same line of authority that EPA
has previously applied when tribes sought to regulate the activities of
nonmembers under the CWA. Retained inherent authority is, however, only
one of the means by which tribes may exercise authority over their
reservations and, in particular, over the activities of nonmembers. The
Supreme Court has long recognized Congress' broad power to delegate
authority to Indian tribes, including the authority to regulate the
conduct of nonmembers of the tribes. See, e.g., United States v.
Mazurie, 419 U.S. 544 (1975). Such delegations are neither inconsistent
with, nor in opposition to, any limitations on retained tribal inherent
authority. Instead, they are a proper exercise of Congress' plenary
power under the U.S. Constitution with respect to Indian tribes. As
with the CAA tribal provision, such delegations may be appropriately
designed to address situations where Congress views coherent management
of reservation resources by tribal governments as an appropriate means
to carry out the purposes of a federal statute on Indian reservations.
As noted above, EPA has long viewed the CWA tribal provision as
expressing a congressional preference for tribal regulation of
reservation water resources. EPA has now taken the related step of
reconsidering and revising its interpretation of section 518 to reflect
Congress' intent to delegate the requisite authority to tribes to
effectuate such regulation.
    EPA also acknowledges that the legislative history of section 518
is inconclusive regarding congressional intent to delegate authority to
tribes. The commenters, however, overstate the degree to which the
legislative record indicates an absence of such intent. EPA carefully
analyzed this legislative history in the preamble to the 1991 WQS TAS
rule and found that the record includes statements that can be
interpreted to support either view. The absence of clarity in the
record was among the reasons EPA opted to proceed initially with a high
degree of caution and impose a requirement not otherwise reflected in
the CWA that tribes demonstrate inherent authority to regulate under
the statute. Notably, in 1996 the district court in Montana v. EPA also
reviewed this legislative history and, while observing that the record
may be ambiguous, reasoned that it was only arguably so because the
bulk of the congressional statements were actually collateral to the
issue and addressed the separate question of whether section 518
affected tribal water quantity rights (which it does not). More
importantly, the key to a congressional delegation of authority is
found in the express language of the statute, and not between the lines
of recorded statements of particular congressional members. In relevant
part, section 518(e) requires only that the CWA functions to be
exercised by an applicant tribe pertain to reservation water resources,
and section 518(h)(1) then uses the ``gold standard'' language to
define such reservations to include all reservation lands irrespective
of ownership. This language expresses clear congressional intent to
delegate authority without any separate requirement that applicant
tribes meet an additional jurisdictional test.
    EPA also finds the absence of any action by Congress to correct
EPA's prior cautious approach to be

unpersuasive on the issue of congressional intent. No amendment to the
statute was needed to reflect Congress' intent, since the language of
section 518 already expressly delegates authority to tribes. EPA is
also unaware of any request considered by Congress to revise section
518 with regard to this question or otherwise apprise EPA of its intent
to delegate authority. Further, although EPA's prior interpretation has
resulted in some additional burdens and delays in processing TAS
applications, EPA has never disapproved a CWA TAS application based on
an absence of tribal regulatory authority (or for any other reason),
and thus has never taken an action directly inconsistent with Congress'
intent to delegate authority to tribes. In these circumstances, it
would be inappropriate to interpret congressional inaction as a
ratification of EPA's prior approach to section 518.
    Further, the fact that Congress in 2000 enacted a separate targeted
amendment to section 518 to make a newly created program available to
tribes without also addressing tribal regulatory authority sheds no
light on the question. In 2000, Congress enacted the coastal recreation
water quality monitoring and notification provision at section 406 of
the CWA and also provided that tribes should be able to obtain TAS for
that program. The fact that Congress did not further amend the statute
at that time to address tribal regulatory authority is unrevealing
regarding its prior intent in 1987 to delegate authority to tribes. For
the reasons described above, there was no substantial cause for
Congress to address tribal jurisdiction at that time. In addition, the
legislative history of the 2000 amendment is consistent with Congress'
narrow purpose to insert section 406 into the list of programs
identified in section 518 for potential TAS. It does not indicate any
consideration of the issue of tribal regulatory authority. Further, CWA
section 406 establishes a funding and monitoring program. It does not
entail the exercise of any regulatory authority by states or tribes. It
would have been highly anomalous for Congress to address tribal
regulatory authority as an adjunct to establishing a TAS opportunity
for a non-regulatory program. In these circumstances, EPA declines to
interpret congressional inaction as a tacit approval or adoption of
EPA's prior approach to tribal authority.
    Finally, EPA continues to view the analogy between CWA and CAA
regulation, and between the tribal provisions of the two statutes, as
supportive of today's rule. Although there are differences between the
two statutes and their relevant histories, both evince a clear
congressional intent (only three years apart) to treat Indian
reservations holistically and to provide for tribal regulation of
mobile pollutants on reservations irrespective of land ownership. The
CAA, which authorizes TAS over both reservation and non-reservation
lands, expresses the delegation of authority by distinguishing between
those two categories and clearly placing reservations within tribal
jurisdiction. The CWA authorizes TAS solely for reservations. The
statute is thus somewhat more limited in the geographic scope of
potential TAS, but, as a result, it more directly expresses the
delegation of authority over the covered reservation areas. Section
518(e)(2) requires only that the tribal program pertain to reservation
water resources, and section 518(h)(1) unambiguously defines
reservations to include all reservation land notwithstanding ownership.
EPA also disagrees with a comment suggesting that differences between
airsheds and watersheds within Indian reservations support treating the
two statutes' tribal provisions differently. In particular, the comment
notes that watersheds can have defined beds and banks that cross lands
with disparate ownership patterns. EPA notes that the same is
essentially true of airsheds, which cover reservation lands without
regard to ownership. As noted by the district court in Montana v. EPA,
the congressional delegation of authority to tribes thus comports with
common sense by avoiding checkerboarded regulation within a reservation
based on land ownership. Montana v. EPA, 941 F. Supp. At 951-52.

B. EPA and Tribal Experience in Processing TAS Applications for CWA
Regulatory Programs

    Based on EPA's experience to date, the TAS application process has
become significantly more burdensome than EPA anticipated in 1991. Many
authorized tribes have informed EPA that the demonstration of inherent
tribal authority, including application of the test established in
Montana v. U.S. regarding tribal inherent authority over the activities
of non-tribal members on nonmember fee lands, constituted the single
greatest administrative burden in their application processes.
    In the 1991 TAS rule, EPA expressed its expert view that given the
importance of surface water to tribes and their members, the serious
nature of water pollution impacts, and the mobility of pollutants in
water, applicant Indian tribes would generally be able to demonstrate
inherent regulatory authority to set WQS for reservation waters,
including as applied to nonmembers on fee lands under federal Indian
law principles. Id. at 64877-79. In light of the Agency's generalized
findings regarding the relationship of water quality to tribal health
and welfare, EPA noted that a tribe could likely meet the Montana test
by making a relatively simple factual showing that (1) there are waters
within the subject reservation used by the tribe or its members, (2)
the waters are subject to protection under the CWA, and (3) impairment
of the waters by nonmember activities on fee lands would have serious
and substantial effects on tribal health and welfare. Id. at 64879. EPA
thus anticipated in the early 1990s that applicant tribes would face a
relatively simple initial burden of supplying basic facts to
demonstrate that they retain requisite inherent authority to regulate
under the CWA--including regulation of nonmember activities on fee
lands--under established federal Indian law principles. Id.
    Unfortunately, EPA's expectations have not, as a general matter,
been realized. Although each TAS application has varied according to
the particular facts and circumstances of the applicant tribe and its
reservation, the general experience confirms that demonstrations of
inherent regulatory authority continue to impose unintended
administrative burden on applicant tribes and to require substantial
commitments of limited tribal and federal resources. In particular, the
demonstration of inherent authority over nonmember activities on the
reservation under the so-called Montana test has created the most
significant and widespread burden and at the same time provides no
information necessary for EPA's oversight of the regulatory program.
Tribes have repeatedly expressed their concern that the demonstration
of inherent authority on a case-by-case basis is challenging, time
consuming and costly. EPA's information about the tribes that it has
found eligible to administer WQS and section 401 certifications
indicates that tribal applications for reservations with nonmember fee
lands, which require an analysis of tribal inherent authority under
Montana, took 1.6 years longer to be approved, on average, than
applications for reservations without such lands.
    The elimination of such unintended administrative burdens does not,
in itself, provide a legal rationale to alter EPA's interpretation of
section 518.

However, streamlining a TAS process that has become unnecessarily
restrictive and burdensome does offer a strong policy basis for the
Agency to take a careful second look at that provision and to
consider--as it contemplated as early as 1991--whether intervening
events have shed additional light on the appropriate statutory
interpretation. Eliminating such unnecessary burdens is consistent with
longstanding EPA and Executive policy to support tribal self-
determination and promote and streamline tribal involvement in managing
and regulating their lands and environments. See, e.g., Executive Order
13175 (65 FR 67249, November 9, 2000); Presidential Memorandum:
Government-to-Government Relations with Native American Tribal
Governments (59 FR 22951, April 29, 1994); EPA Policy for the
Administration of Environmental Programs on Indian Reservations
(November 8, 1984).
    As explained in section III, EPA has long interpreted the CWA as
expressing Congress' preference for tribal regulation of reservation
surface water quality. See, e.g., 56 FR at 64878. As explained in
section IV.A, relevant developments definitively confirm that section
518 includes an express delegation of authority by Congress to eligible
tribes to regulate water resources under the CWA throughout their
entire reservations.

V. EPA's Revised Statutory Interpretation

A. What does today's revised interpretation provide and why?

    EPA today revises its interpretation of CWA section 518 and
concludes definitively that Congress expressly delegated authority to
Indian tribes to administer CWA regulatory programs over their entire
reservations, including over nonmember activities on fee lands within
the reservation of the applicant tribe, subject to the eligibility
requirements in section 518. In doing so, EPA thus exercises the
authority entrusted to it by Congress to implement the CWA TAS
provision.
    The effect of this interpretive rule is to relieve a tribe of the
need to demonstrate its inherent authority when it applies for TAS to
administer a CWA regulatory program. An applicant tribe still needs to
meet all other eligibility requirements specified in CWA section 518
and EPA's implementing regulations. Nonetheless, this rule eliminates
any need to demonstrate that the applicant tribe retains inherent
authority to regulate the conduct of nonmembers of the tribe on fee
lands under the test established by the Supreme Court in Montana v.
U.S. Instead, an applicant tribe can generally rely on the
congressional delegation of authority in section 518 as the source of
its authority to regulate its entire reservation under the CWA without
distinguishing among various categories of on-reservation land. The
tribe may, however, need to supply additional information to address
any potential impediments to the tribe's ability to effectuate the
delegation of authority.
    EPA bases its revised interpretation of CWA section 518 on its
analysis in section IV above and a careful consideration of comments
received. Most importantly, EPA's revised interpretation is based on
the plain text of section 518 itself. Section 518(e)(2) requires only
that the functions to be exercised by the applicant Indian tribe
pertain to the management and protection of water resources ``within
the borders of an Indian reservation.'' Section 518(h)(1) then defines
the term ``federal Indian reservation'' to include all lands within the
limits of any Indian reservation notwithstanding the issuance of any
patent, and including rights-of-way running through the reservation.
That definition is precisely the same language that the dissent in APS
stated is the ``gold standard'' for an express congressional delegation
of regulatory authority to tribes over their entire reservations. APS,
211 F.3d at 1302-03. It is also the language that the U.S. Supreme
Court reviewed in finding congressional delegations to tribes in other
cases. United States v. Mazurie, 419 U.S. 544 (1975) (delegation of
authority to tribes regarding regulation of liquor); Rice v. Rehner,
463 U.S. 713 (1983) (same). Although the legislative history of section
518 has, of course, remained unaltered since 1987, the plain language
of the statute and the above-described developments provide ample
support for the revised interpretation.
    As EPA explained in section IV.A in connection with the CAA, such a
territorial approach that treats Indian reservations uniformly promotes
rational, sound management of environmental resources that might be
subjected to mobile pollutants that disperse over wide areas without
regard to land ownership. See 59 FR at 43959. As specifically
recognized by the district court in Montana v. EPA, the same holds true
for regulation under the CWA. Montana, 941 F. Supp. at 952.

B. What other approaches did EPA consider?

    EPA considered not revising its 1991 interpretation of section 518.
EPA did not choose this option because it would continue to impose an
unnecessary requirement on applicant tribes not specified in the CWA to
demonstrate inherent authority, including meeting the Montana test
regarding activities of nonmembers on their reservation fee lands, when
they apply to regulate under the statute.
    EPA also considered revising the text of existing TAS regulations
for CWA regulatory programs to alter tribal application requirements in
light of the revised interpretation. In particular, EPA considered
revising the requirements relating to tribal submissions of statements
addressing jurisdiction as well as the procedures for states and other
appropriate entities to comment on tribal assertions of authority. Had
EPA decided to revise its regulations, EPA would have issued a
legislative rule revising the TAS application provisions in the Code of
Federal Regulations. However, EPA rejected this approach as both
unnecessary and counterproductive. As described in section V.C.6, EPA
concludes that the existing regulations are appropriately structured to
accommodate the revised interpretation and that the procedures
requiring tribal legal statements and providing opportunities for
notice and comment continue to serve important purposes. Among other
things, such procedures ensure that applicant tribes will continue to
adequately address the reservation boundaries within which they seek to
regulate under the CWA as well as any potential impediments that may in
some cases exist to their ability to accept or effectuate the
congressional delegation of authority. Retaining the notice and comment
requirements will also ensure that states and other appropriate
entities continue to have an opportunity to interact with EPA on these
issues and that EPA's decision making on individual TAS applications is
well informed.
    Because today's interpretive rule merely explains EPA's revised
interpretation of existing statutory requirements established in the
CWA tribal provision--and does not make any changes to the existing
regulations--an interpretive rule is the appropriate vehicle to
announce EPA's revised approach.
Consideration of Comments
    One state commented that EPA must use a legislative rulemaking
process because the revised interpretation will eliminate the existing
regulatory requirement that applicant tribes submit a statement
addressing their jurisdiction and will affect states' opportunity under

the regulations to comment on tribal jurisdiction. A local government
also expressed concern with EPA's statement in the proposal that the
interpretive rule is not subject to notice and comment requirements of
the Administrative Procedure Act.
    EPA disagrees that a legislative rulemaking is required to issue
the revised interpretation. As noted above, EPA has decided not to
revise any existing TAS application regulations published in the Code
of Federal Regulations. Contrary to the state commenter's assertion,
EPA specifically decided to retain the regulatory requirements relating
to tribal jurisdictional statements and states' opportunity to comment
on such assertions. Although EPA could reasonably have chosen to revise
or eliminate aspects of these regulations, EPA has concluded that
requiring applicant tribes to submit relevant jurisdictional
information and allowing states and other appropriate entities to
comment on such submissions will continue to ensure that any
reservation boundary or other relevant jurisdictional issues are raised
during a well-informed decision making process.
    Importantly, although this interpretive rule is not subject to
notice and comment requirements of the Administrative Procedure Act,
EPA decided to provide notice and an opportunity for comment--in
addition to other pre- and post-proposal outreach to tribes, states,
and the public--to increase transparency and to allow interested
parties to provide their views. EPA received comments on the proposal
and has considered them in developing today's rule. A member of the
academic community expressly supported EPA's use of an interpretive
rule as the appropriate administrative mechanism to publish the revised
interpretation. EPA appreciates that support.

C. What is EPA's position on certain public comments and tribal and
state input?

    In this section, EPA responds to several specific topics that were
raised in public comments on EPA's proposal and in earlier input
received from tribes and states during pre-proposal and post-proposal
outreach.
1. Geographic Scope of TAS for Regulatory Programs
    EPA's final rule does not affect--either by expanding or
contracting--the geographic scope of potential tribal TAS eligibility
under the CWA. Under section 518, tribes can only obtain TAS status
over waters within the borders of their reservations. See, e.g., 56 FR
at 64881-82. Thus, under any approach to tribal regulatory authority
under the CWA, tribal TAS eligibility under the CWA is limited to
managing and protecting water resources within Indian reservations.
Tribes can seek TAS with respect to water resources pertaining to any
type of on-reservation land, including, for example, reservation land
held in trust by the United States for a tribe, reservation land owned
by or held in trust for a member of the tribe, and reservation land
owned by non-tribal members. Conversely, tribes cannot obtain TAS under
the CWA for water resources pertaining to any non-reservation Indian
country \10\ or any other type of non-reservation land.\11\ Today's
rule does not alter that basic limitation of TAS under the CWA.
---------------------------------------------------------------------------

    \10\ Indian country is defined at 18 U.S.C. 1151 as: (a) All
land within the limits of any Indian reservation under the
jurisdiction of the United States Government, notwithstanding the
issuance of any patent, and, including rights-of-way running through
the reservation; (b) all dependent Indian communities within the
borders of the United States whether within the original or
subsequently acquired territory thereof, and whether within or
without the limits of a state; and (c) all Indian allotments, the
Indian titles to which have not been extinguished, including rights-
of-way running through the same. Indian reservations are thus a
subset of the broader geographic area that comprises Indian country
as a whole.
    \11\ Many tribes have rights to hunt, fish, gather resources, or
perform other activities in areas outside of their reservations. To
the extent the lands on which these rights are exercised are not
Indian reservation lands as defined at 18 U.S.C. 1151(a), tribes
cannot obtain TAS under the CWA for water resources pertaining to
such lands.
---------------------------------------------------------------------------

Consideration of Comments
    EPA received comments from several local governments seeking
clarification of the geographic scope of TAS for CWA regulatory
purposes and in particular noting that some reservations have complex
histories of congressional treatment, including the opening of
reservations to non-Indian settlement through surplus land acts. The
commenters assert that each surplus land statute must be analyzed
individually to determine whether it has altered the land status of the
subject reservation and note that in some cases such statutes may
result in situations where certain lands are taken out of reservation
status, even though they remain surrounded by the original exterior
boundaries of a reservation. The commenters request that EPA define the
fee-owned lands that may be covered by a TAS application to exclude
lands settled by non-tribal members pursuant to a federal surplus land
act. One tribal commenter noted that there may be non-reservation
inholdings that are surrounded by reservation lands and disagreed with
EPA's approach of requiring that all lands subject to TAS for CWA
regulatory purposes qualify as Indian reservation land. A state
commenter agreed with EPA that reservation boundaries remain a relevant
issue for tribal TAS applications and noted that EPA's revised
interpretation would not reduce any burdens associated with resolving
such issues.
    EPA notes that any issues regarding the geographic scope of TAS
under the CWA are outside the scope of this interpretive rule. As noted
above and in the proposal, the revised interpretation does not alter in
any way EPA's longstanding approach to the limitation of TAS in CWA
section 518 to lands that qualify as reservation lands. This basic
geographic land status limitation exists irrespective of whether tribes
must demonstrate inherent authority to regulate under the CWA or
whether they may rely on the congressional delegation of authority in
section 518.
    EPA appreciates the local governmental commenters' questions and
understands that some Indian reservations may have complicated
histories and that reservation boundaries may be altered by
congressional act. EPA agrees that any such issue would need to be
addressed on a reservation-specific basis and that each relevant
surplus lands statute would need to be evaluated individually. Such
issues would thus be raised and addressed only in the context of a
particular TAS application from a specific tribe. To provide additional
clarity, however, EPA reiterates as a general matter that any land
subject to TAS approval for CWA regulatory purposes must qualify as
Indian reservation land as defined in CWA section 518(h)(1). Thus,
consistent with EPA's longstanding approach, any non-reservation land
could not be included in a CWA TAS approval even if it is surrounded by
other land that does qualify as reservation. Any land located within
the original exterior boundaries of a reservation that has lost its
reservation status by virtue of an act of Congress could thus not be
included in a CWA TAS approval. EPA has never approved CWA TAS over
such non-reservation land, and would have no authority to do so. EPA
thus disagrees with the tribal commenter that non-reservation
inholdings may be included in a TAS approval under the CWA. This
limitation is imposed in the statute, and nothing in today's final rule
alters or affects EPA's approach on this issue. EPA does not believe,
however, that the Agency should establish a separate definition for
``fee lands'' that may be

included in a CWA TAS application. Section 518(h)(1) of the CWA already
provides the applicable definition of federal Indian reservations for
purposes of the statute, and there is no need for an additional
definition. Further, as noted by the commenters, each surplus land act
must be viewed on its own terms and in light of its own history and
treatment. It would thus be inappropriate to establish a single one-
size-fits-all approach to lands that have passed to non-tribal members
pursuant to such a statute. Only where such lands are determined to
have lost their reservation status would they be outside the scope of
TAS under the CWA. EPA also agrees with the state commenter that any
issues relating to reservation boundaries will remain relevant to the
TAS application process. Although today's rule does not reduce any
burdens associated with resolving such issues, it also does not
increase any such burdens. The need for tribes to demonstrate their
reservation boundaries as part of a TAS application is beyond the scope
of--and is not affected by--today's rule.
2. Treatment of Tribal Trust Lands
    Today's revised interpretation does not alter EPA's longstanding
approach to tribal trust lands. Indian reservations include trust lands
validly set aside for Indian tribes even if such lands have not
formally been designated as an Indian reservation. Many named Indian
reservations were established through federal treaties with tribes,
federal statutes, or Executive Orders of the President. Such
reservations are often referred to as formal Indian reservations. Many
tribes have lands that the United States holds in trust for the tribes,
but that have not been formally designated as reservations. Under EPA's
longstanding approach, and consistent with relevant judicial precedent,
such tribal trust lands are informal reservations and thus have the
same status as formal reservations for purposes of the Agency's
programs. See, e.g., 56 FR at 64881; 63 FR at 7257-58; APS, 211 F.3d at
1292-94. Tribes have always been able to seek TAS over such tribal
trust lands for CWA purposes (several tribes have done so previously),
and nothing in today's revised interpretation alters or affects their
ability to do so.
Consideration of Comments
    One state commenter requested additional clarification regarding
the treatment of tribal trust lands for CWA TAS purposes, and in
particular inquired whether tribal trust lands outside the borders of a
tribe's formal reservation would be included in the statute's
definition of reservation. Although this issue is outside the scope
of--and is not affected by--today's interpretive rule, EPA welcomes the
opportunity to provide further clarity. EPA notes that some tribes may
have tribal trust lands in addition to, and separate from, a formal
reservation. For other tribes, such tribal trust lands may constitute
the tribe's entire reservation land base. In either case, the tribal
trust lands qualify as reservation lands for CWA TAS purposes. All such
lands are thus within the borders of an Indian reservation for purposes
of the statute.
3. Tribal Criminal Enforcement Authority
    EPA's revised statutory interpretation does not affect any existing
limitations on tribal criminal enforcement authority. This interpretive
rule relates solely to applicant Indian tribes' civil regulatory
authority to administer CWA regulatory programs on their reservations;
it does not address or in any way alter the scope of tribal criminal
enforcement jurisdiction. EPA is aware that federal law imposes certain
significant limitations on Indian tribes' ability to exercise criminal
enforcement authority, particularly with regard to non-Indians. EPA has
previously established regulations addressing implementation of
criminal enforcement authority on Indian reservations for those CWA
programs that include potential exercises of such authority. See, e.g.,
40 CFR 123.34, 233.41(f). These regulations provide that the federal
government will retain primary criminal enforcement responsibility in
those situations where eligible tribes do not assert or are precluded
from exercising such authority.
Consideration of Comments
    Two industry commenters asserted that the limitations on a tribe's
authority to impose the criminal sanctions that are specified as
potential penalties in the CWA render the tribe unable to demonstrate
that it is capable of carrying out required program functions for
purposes of TAS eligibility. This issue is outside the scope of--and is
not affected by--today's interpretive rule. As noted above, this rule
addresses only the civil regulatory authority of applicant tribes. The
rule also does not address the capability element of TAS eligibility
under the CWA. Nonetheless, EPA notes that it disagrees with the
commenters' assertion--which, if correct, would presumably preclude any
tribe from demonstrating TAS eligibility for a CWA regulatory program
that includes a criminal enforcement component. As described above,
EPA's existing TAS regulations provide that the federal government will
exercise primary criminal enforcement authority where tribal authority
is limited or precluded. These regulations were promulgated to avoid
precisely the outcome asserted by the commenters. The regulations have
been in place for decades, and they are unaffected by today's
interpretive rule.
    EPA also disagrees with the commenters' assertion that the absence
of any statutory language in section 518 addressing the limitations on
tribal criminal authority is an indication that Congress did not intend
to delegate authority to Indian tribes. EPA notes that the limitations
on tribal criminal enforcement originate in legal principles
established separate and apart from the CWA. Therefore, if the
commenters were correct, Indian tribes could never demonstrate
authority--whether inherent or congressionally delegated--to administer
a CWA program that includes a criminal enforcement component without
some statement in the statute affirming or otherwise addressing the
exercise of criminal authority. Because the statute contains no such
statement, this would render TAS impossible even under EPA's prior
interpretation, and would thus make the CWA TAS provision internally
inconsistent and in significant part a nullity. Under the commenters'
approach, section 518 would, on the one hand, authorize TAS for
programs that include criminal enforcement, while simultaneously
precluding such TAS by virtue of an absence of congressional
explanation of how criminal enforcement will be exercised. EPA
disagrees that this could reflect Congress' intent. EPA also notes that
the Agency has already interpreted the CAA tribal provision as
including a congressional delegation of civil regulatory authority to
tribes over their entire reservations, and that interpretation has been
upheld in court. Like the CWA, the CAA authorizes TAS for programs that
include a criminal enforcement component without separately addressing
the exercise of such authority during program implementation. Under
both statutes, EPA has exercised its authority to address this
programmatic issue through long-established regulations that retain
primary criminal enforcement with the federal government.
4. Special Circumstances
    There could be rare instances where special circumstances limit or
preclude a particular tribe's ability to accept or

effectuate the congressional delegation of authority over its
reservation. For example, there could be a separate federal statute
establishing unique jurisdictional arrangements for a specific state or
a specific reservation that could affect a tribe's ability to exercise
authority under the CWA. It is also possible that provisions in
particular treaties or tribal constitutions could limit a tribe's
ability to exercise relevant authority.\12\
---------------------------------------------------------------------------

    \12\ EPA takes no position in this interpretive rule regarding
whether any particular tribe or Indian reservation is subject to any
potential impediment relating to effectuation of the congressional
delegation of regulatory authority or how the CWA can be interpreted
vis-[agrave]-vis the alleged source of any such impediment. Any such
issue would need to be addressed on a case-by-case basis and with
the benefit of a full record of relevant information that would be
developed during the processing of a particular TAS application. To
the extent EPA is ever called upon to make a decision regarding this
type of issue, such a decision would be rendered in the context of
EPA's final action on a specific TAS application, and any judicial
review of that decision would occur in that context.
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    The application requirements of existing CWA TAS regulations
already provide for tribes to submit a statement of their legal counsel
(or equivalent official) describing the basis for their assertion of
authority. The statement can include copies of documents such as tribal
constitutions, by-laws, charters, executive orders, codes, ordinances,
resolutions, etc. See 40 CFR 131.8(b)(3)(ii); 123.32(c); 233.61(c)(2).
Under today's rule, the requirement for a legal counsel's statement
continues to apply and ensures that applicant tribes appropriately rely
on the congressional delegation of authority and provide any additional
information that could be relevant to their ability to accept or
effectuate the delegated authority. As described below in section
V.C.6, existing CWA TAS and program regulations also continue to
provide appropriate opportunities for other potentially interested
entities--such as states or other Indian tribes adjacent to an
applicant tribe--to comment on an applicant tribe's assertion of
authority and, among other things, inform EPA of any special
circumstances that they believe could affect a tribe's ability to
regulate under the CWA.
Consideration of Comments
    EPA received several comments asserting that special circumstances
limit particular tribes' ability to obtain TAS to regulate under the
CWA. For instance, one state asserted that the tribes located within
the state are precluded under federal laws specific to those tribes
from obtaining TAS for CWA regulatory programs. Another state asserted
that a tribe located within the state is precluded by a federal statute
specific to that tribe from regulating reservation land that is owned
in fee by nonmembers of the tribe. The state noted that if that tribe
applied to regulate such fee lands, the state would avail itself of the
opportunity under EPA's regulations to submit comments and would assert
that the cited federal law affects the tribe's ability to exercise such
authority. One local government commented that the geographic extent of
a tribe's governing authority does not include the local government and
provided historical information intended to support its position. And
two industry commenters asserted that the tribe upon whose reservation
they are located has entered into binding agreements waiving the
tribe's right to regulate the commenters' facilities, thus rendering
the tribe unable to obtain TAS for CWA regulatory programs over those
facilities.
    EPA appreciates the information about special circumstances
provided in these comments. Importantly, the precise outcome of any
such circumstance could only be determined in the context of a
particular tribe's TAS application and upon a full record of
information addressing the issue. The substance of these specific
situations is thus outside the scope of--and is not affected by--
today's rule. However, the comments are both illustrative and
instructive regarding the types of special circumstances and
jurisdictional issues that may affect a tribe's ability to carry out
the congressional delegation of authority in the CWA tribal provision.
Other federal statutes may, for instance, limit a particular tribe's or
group of tribes' ability to participate, in whole or in part, in CWA
regulation through the TAS process. In addition, before approving a
tribe's TAS eligibility, EPA would carefully consider whether any
binding contractual arrangements or other legal documents such as
tribal charters or constitutions might affect the tribe's regulatory
authority generally, or with regard to any specific members of the
regulated community. Finally, the geographic scope of the reservation
boundaries over which a tribe asserts authority would continue to be a
relevant and appropriate issue for consideration in the TAS process. As
explained elsewhere, EPA's existing TAS regulations require applicant
tribes to address these types of issues in their jurisdictional
statements and provide states and other appropriate entities the
opportunity to comment and inform EPA of any potential impediments to
tribal regulatory authority. These comment opportunities help ensure
that EPA's decision making is well informed. Additional available
information regarding certain of these special circumstances is
provided in EPA's Response to Comments document included in the docket
for this rule.
    During pre-proposal outreach and again following proposal of the
rule, EPA received comments from the State of Oklahoma regarding
section 10211(b) of the Safe, Accountable, Flexible, Efficient
Transportation Equity Act of 2005 (``SAFETEA''), Public Law 109-59, 119
Stat. 1144 (August 10, 2005). Because this provision of federal law
expressly addresses TAS under EPA's statutes, including the CWA, EPA
explained in the proposal that section 10211(b) established a unique
TAS requirement with respect to Indian tribes located in the State of
Oklahoma. Under section 10211(b), tribes in Oklahoma seeking TAS under
a statute administered by EPA for the purpose of administering an
environmental regulatory program must, in addition to meeting
applicable TAS requirements under the EPA statute, enter into a
cooperative agreement with the state that is subject to EPA approval
and that provides for the tribe and state to jointly plan and
administer program requirements. This requirement of SAFETEA exists
apart from, and in addition to, existing TAS criteria, including the
TAS criteria set forth in section 518 of the CWA. Today's rule relates
solely to the interpretation of an existing CWA TAS requirement; it
thus has no effect on the separate TAS requirement of section 10211(b)
of SAFETEA. In its comments on the proposal, the State of Oklahoma
requested additional information regarding the process or sequence of
events that will be used to ensure that this provision of SAFETEA is
satisfied in the context of particular tribal TAS applications that may
be submitted following finalization of today's interpretive rule. EPA
notes that section 10211(b) expressly contains certain procedural
requirements--i.e., the state/tribal cooperative agreement must be
subject to EPA review and approval after notice and an opportunity for
public hearing. Nothing in today's rule alters or affects those
requirements. Further, because the SAFETEA requirement must be
satisfied for a tribe in Oklahoma to obtain TAS to regulate under an
EPA statute, the final cooperative agreement must be fully executed and
approved by EPA before EPA can approve a regulatory TAS application.
Because the State of Oklahoma is a required signatory to the agreement,
this sequence of events

ensures that the State will have a full opportunity to participate in
the TAS process--separate and apart from opportunities that states have
through EPA's existing TAS notice and comment procedures. Nothing in
today's interpretive rule alters or affects Oklahoma's participation in
the SAFETEA cooperative agreement or the requirement that the agreement
be in place as a prerequisite to TAS for a regulatory program. EPA
notes that there are no regulations establishing procedures for the
State and applicant tribes to negotiate SAFETEA cooperative agreements
or for tribes to submit, and EPA to review, such agreements. There is
thus flexibility for the State and applicant tribes in Oklahoma to work
together to develop these agreements as they deem appropriate.
5. Tribal Inherent Regulatory Authority
    With today's rule, EPA is not intending to assess the extent of
tribal inherent regulatory authority. As the Agency clearly articulated
in the TAS rules identified in section II.B, the importance of water
resources to tribes, the serious potential impacts of water pollution
on tribes' uses of their waters, and the mobility of pollutants in
water all strongly support tribes' ability to demonstrate their
inherent authority to regulate surface water quality on their
reservations, including the authority to regulate nonmember conduct on
fee lands under the Supreme Court's test established in Montana.
Consistent with its 1991 interpretation of section 518, EPA concluded
that each of the tribes it has approved for TAS for CWA regulatory
programs has demonstrated its inherent regulatory authority and has
demonstrated that the functions it sought to exercise pertain to the
management and protection of reservation water resources. All Agency
CWA TAS determinations challenged in court have been upheld.
    Today's rule does not affect these prior TAS approvals. The rule
does, however, modify EPA's approach going forward to be consistent
with Congress' intent to delegate civil regulatory authority to
eligible tribes. It relieves tribes of the administrative burden
associated with demonstrating their inherent regulatory authority in
the TAS application process. It does not, however, alter EPA's prior
views regarding the extent of tribal inherent regulatory authority.\13\
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    \13\ In promulgating the CAA Tribal Authority Rule, EPA
similarly noted its view that even absent a direct delegation of
authority from Congress, tribes would very likely have inherent
authority over all activities within Indian reservation boundaries
that are subject to CAA regulation. 59 FR at 43958 n.5.
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Consideration of Comments
    All of the tribal commenters fully support EPA's interpretive rule.
Several tribes also noted their view that tribes possess inherent
authority to regulate the quality of their reservation waters. EPA
appreciates these comments and reiterates that today's revised
interpretation of the CWA tribal provision is intended solely to
effectuate the plain intent of Congress to delegate civil authority to
tribes to regulate water resources on their entire reservations under
the CWA. Today's rule is not intended as an assessment of the scope of
retained tribal inherent authority.
    Several state, local government, and industry commenters asserted
that under federal law, tribal inherent regulatory authority over
nonmembers of the tribe is limited and that the U.S. Supreme Court has
consistently recognized and affirmed such limitations. The commenters
appear to assert that such limitations argue against EPA's revised
interpretation of the CWA tribal provision. EPA disagrees. EPA is aware
of Supreme Court jurisprudence addressing retained tribal inherent
regulatory authority, particularly with regard to such authority as
applied to non-tribal members. However, as described above in sections
IV and V.A, federal law also recognizes Congress' authority to delegate
jurisdiction to tribes to regulate throughout their reservations,
including regulation of the activities of non-tribal members. A
relevant reviewing federal court has already upheld EPA's
interpretation that the Clean Air Act includes such a delegation, and
the plain language of CWA section 518 supports the same approach.
Issues regarding tribal inherent authority are distinct from EPA's
interpretation of the express statutory language in section 518.
6. Existing Regulatory Requirements
    Because today's revised statutory interpretation is consistent with
existing CWA TAS regulatory requirements, EPA has not revised any
regulatory text in the Code of Federal Regulations.
a. TAS Requirements
    Consistent with today's rule, tribes will rely on the congressional
delegation of authority in section 518 as the source of their authority
to regulate water quality on their reservations. Under the TAS
regulations identified in section II.B, tribes would still need to
address and overcome any special circumstances that might affect their
ability to obtain TAS for a CWA regulatory program (see section V.C.4),
and the existing TAS application regulations require submission of a
legal statement that would cover such issues. Apart from such special
circumstances, the main focus in determining the extent of an applicant
tribe's jurisdiction for CWA regulatory purposes will likely be
identifying the geographic boundaries of the Indian reservation area
(whether a formal or informal reservation) over which the
congressionally delegated authority would apply.\14\ EPA's existing CWA
TAS regulations already provide for applicant tribes to submit a map or
legal description of the reservation area that is the subject of the
TAS application. See 40 CFR 131.8(b)(3)(i); 123.32(c); 233.61(c)(1);
501.23(c). These provisions continue to apply and ensure that each
tribe applying for a CWA regulatory program submits information
adequate to demonstrate the location and boundaries of the subject
reservation.
---------------------------------------------------------------------------

    \14\ The jurisdictional inquiry into the geographic scope of a
tribe's TAS application--i.e., the boundary of the reservation area
that a tribe seeks to regulate--imposes no additional burden on
entities that wish to comment on an applicant tribe's assertion of
authority. Under any approach to tribal regulatory authority, the
geographic scope of the TAS application is a relevant jurisdictional
consideration and thus an appropriate issue for potential comment
during the TAS process. Commenters have, at times, raised such
geographic issues in the context of previous TAS applications; EPA's
rule does not alter the opportunity to do so for future
applications, or any burden attendant to preparing and submitting
such comments.
---------------------------------------------------------------------------

    The existing regulations also provide appropriate opportunities for
potentially interested entities to comment to EPA regarding any
jurisdictional issues associated with a tribe's TAS application. As
mentioned in section II.B above, EPA's TAS regulations for the CWA
section 303(c) WQS program include a process for notice to appropriate
governmental entities--states, tribes and other federal entities
located contiguous to the reservation of the applicant tribe--and
provide an opportunity for such entities to provide comment on the
applicant tribe's assertion of authority. EPA makes such notice broad
enough that other potentially interested entities can participate in
the process. 56 FR at 64884. For example, EPA routinely publishes
notice of tribal TAS applications for the WQS program in relevant local
newspapers covering the area of the subject reservation and in
electronic media.
Consideration of Comments
    EPA received comments from local governments requesting that EPA
ensure

direct notice to such governments of tribal TAS applications for the
CWA WQS program. EPA appreciates that certain local governments may
wish to comment on tribal assertions of authority to administer CWA
WQS. However, any issues regarding the notice and comment process in
EPA's TAS regulations for that program are beyond the scope of this
interpretive rule, which addresses solely EPA's interpretation of
section 518 as a congressional delegation of authority. EPA has
retained the regulations governing the notice and comment process in
their entirety and believes that the process provides appropriate
notice to potentially interested entities in the area of an applicant
Indian tribe's reservation. The process has proven to be effective in
ensuring that relevant issues regarding tribal jurisdiction are raised
to EPA during the TAS decision making process.
b. Relationship to Program Approvals
    The existing TAS regulations and this rule relate solely to the
applications of Indian tribes for TAS eligibility for the purpose of
administering CWA regulatory programs. They do not provide substantive
approval of an authorized tribe's actual CWA regulatory program. Each
program has its own regulations specifying how states and authorized
tribes are to apply for and administer the program.
    EPA's TAS regulations for the CWA section 402, 404 and 405
permitting programs require an analysis of tribal jurisdiction as part
of the program approval process under 40 CFR parts 123, 233 and 501
that are described in section II.B. As described in the Simplification
Rule, EPA makes its decisions to approve or disapprove those programs
as part of a public notice and comment process conducted in the Federal
Register. 59 FR at 64340.
7. Effects on Tribal TAS Applications
    Today's interpretive rule streamlines the TAS application and
review process for tribes seeking eligibility to administer CWA
regulatory programs. The rule significantly reduces the expected time
and effort for tribes to develop and EPA to review TAS applications and
could encourage more tribes to apply for TAS for CWA regulatory
programs. As stated above (sections V.C.4 and V.C.6), applicant tribes
would still need to identify their reservation boundaries and address
any special circumstances potentially affecting their ability to
effectuate the congressional delegation of authority and obtain TAS to
regulate under the CWA.
    Any EPA approval of a TAS application for a CWA regulatory program
after May 16, 2016 will be based on the delegation of authority from
Congress as the relevant source of authority supporting the tribe's
eligibility. Any new tribal TAS application for a CWA regulatory
program submitted after May 16, 2016 will need to be consistent with
the interpretation of section 518 expressed in this rule. For any
pending TAS application for CWA regulatory programs as of May 16, 2016,
EPA will consult with the applicant tribe to assist it in amending its
application if necessary to be consistent with this rule and to address
any process issues.
8. Effects on EPA-Approved State Programs
    EPA's rule has no effect on the scope of existing state regulatory
programs approved by EPA under the CWA. Generally speaking, civil
regulatory jurisdiction in Indian country lies with the federal
government and the relevant Indian tribe, not with the states. See,
e.g., Alaska v. Native Village of Venetie Tribal Gov't, 522 U.S. 520,
527 n.1 (1998). Therefore, in the absence of an express demonstration
of authority by a state for such areas, and an EPA finding of that
state authority for those Indian country waters, EPA has generally
excluded Indian country from its approvals of state regulatory programs
under the CWA.
    The revised reinterpretation of section 518 relates solely to the
exercise of jurisdiction by Indian tribes on their reservations; it has
no effect on the scope of existing CWA regulatory programs administered
by states outside of Indian country. It neither diminishes nor enlarges
the scope of such approved state programs.
    There are uncommon situations where a federal statute other than
the CWA grants a state jurisdiction to regulate in areas of Indian
country. For example, in a few cases EPA has approved states to operate
CWA regulatory programs in areas of Indian country where the states
demonstrated jurisdiction based on such a separate federal statute.
This rule does not address or affect such jurisdiction that other
federal statutes provide to states.
    Regulations already exist to address circumstances where a state or
tribe believes that unreasonable consequences could arise or have
arisen as a result of differing WQS set by states and eligible Indian
tribes on common bodies of water. Section 518(e) of the CWA required
EPA to provide a mechanism to address such situations. The Agency did
so at 40 CFR 131.7, which establishes a detailed dispute resolution
mechanism. Today's rule does not affect that process; the process
remains available as needed to address potential state/tribal issues.
Consideration of Comments
    EPA received comments from several states, a local government, and
a local government association regarding potential effects of the rule
on state water quality programs. Some comments asserted that the rule
would improperly displace existing state authority to protect water
quality in certain Indian reservation areas--e.g., lands owned in fee
by nonmembers of a tribe, or submerged lands owned by the states.
Related comments argued that the rule is unnecessary because the states
are already implementing clean water programs over such areas. One
state commenter also questioned whether the rule would preempt states'
ability to apply state water quality laws, particularly with respect to
non-tribal members on non-tribal land. Another state commenter cited
separate federal statutes that grant the state environmental regulatory
authority, including authority to administer CWA programs, in Indian
territories, and asserted that the rule would therefore be unlawful in
that state to the extent it could alter the jurisdictional arrangement
of those other federal laws.
    EPA appreciates these comments and wishes to further clarify the
Agency's view that the revised interpretation announced today would not
affect existing EPA-approved state programs or other state authorities.
Importantly, it is EPA's position that the congressional delegation of
jurisdiction in CWA section 518 relates solely to the authority of
tribes to administer regulatory programs under the CWA. It does not
address or affect (by enlarging or diminishing) the authority of any
entity--tribe or state--to apply any water quality or other program
established under its laws outside the scope of the federal CWA. Any
question regarding whether a state has sufficient authority to apply
such state laws to non-tribal members on their reservation fee lands
(or to otherwise apply such laws on an Indian reservation), is outside
the scope of today's rule and would be unaffected by the rule. EPA does
not, for instance, view Congress' decision to delegate to tribes the
authority to regulate their reservations under the CWA as increasing or
altering tribal authority to implement any other tribal law or
program--including non-CWA tribal water quality laws. Nor does EPA take
the position that the congressional delegation of CWA

jurisdiction to tribes serves to preempt application of any state law
on an Indian reservation to the extent such state law is premised on
authority found outside the CWA. EPA notes that the Agency has
similarly taken no position that the congressional delegation of
authority in the CAA tribal provision acts as a preemption of state
authority to apply state air quality laws on Indian reservations to the
extent such laws are outside the purview of the federal CAA. Issues
regarding a state's authority to implement environmental quality
programs on reservation fee (or other) lands where such programs are
outside the scope of the federal statutes EPA administers are beyond
the scope of EPA's oversight and are unaffected by today's rule.
    With regard to state water quality programs approved by EPA under
the CWA, EPA disagrees with the commenters' assertion that today's rule
could affect or displace existing state authorities. As noted above,
under principles of federal law, states generally lack authority to
regulate on Indian reservations. EPA has thus generally excluded such
lands from the Agency's approval of state programs submitted to EPA
under the CWA (and other environmental laws administered by EPA). It is
thus generally the case that states are not approved by EPA in the
first instance to administer CWA regulatory programs on reservations.
In most cases, therefore, there are no existing EPA-approved state CWA
programs on reservations that could be affected or displaced by a
congressional delegation of authority to Indian tribes.
    States may apply to EPA for CWA program approval over reservation
areas. In such cases, the state would need to demonstrate a source of
regulatory authority premised in federal law. Such a demonstration
would be needed irrespective of whether the reservation land at issue
is owned by non-tribal members or by the state itself. In rare
circumstances, EPA has in the past approved certain state CWA
regulatory programs on Indian reservations. In each case, the relevant
state's authority has been based on a separate federal statute
expressly granting the state jurisdiction to regulate on the
reservation. Today's rule does not affect such EPA-approved state
programs or otherwise alter the apportionment of jurisdiction
established in those other federal laws. Although each case must be
assessed in light of its own statutory arrangement, EPA generally
believes that CWA section 518 would not affect a separate statutory
scheme that is specifically applicable to a particular state or tribe
and that expressly provides for state environmental regulatory
jurisdiction on Indian reservation lands and/or expressly precludes
tribes from asserting such authority. This does not mean, as asserted
by one state commenter, that today's rule would be unlawful in such a
state. It simply means that the congressional delegation of authority
in section 518 may be precluded by a separate federal law, with
jurisdiction to administer CWA regulatory programs being granted to the
state under that law. As described above in section V.C.4, EPA
recognizes that such unusual circumstances may affect certain tribes'
ability to effectuate the congressional delegation of authority or
otherwise obtain TAS to regulate under the CWA. A situation where a
separate federal law specifically apportions jurisdiction among a
particular state and the tribe(s) located in such state could be one
example of such a circumstance.

VI. How does the rule affect existing EPA guidance to tribes seeking to
administer CWA regulatory programs?

    As noted in section V.C.6, today's rule does not revise any
regulatory text. However, it does render some of EPA's existing
guidance obsolete. For example, parts of a 1998 memorandum to EPA staff
(the ``Cannon-Perciasepe Memorandum'') \15\ provided guidance for EPA's
reviews of tribal assertions of inherent authority to administer CWA
regulatory programs. Among other things, the memorandum established a
case-by-case process for EPA to seek comments from appropriate
governmental entities and the public on EPA's proposed factual findings
relating to an applicant tribe's assertion of inherent authority over
nonmember activities on reservation fee lands. Cannon-Perciasepe
Memorandum, p. 6. The memorandum also provided detailed guidance for
implementing the Montana test, which, as described above, relates to
inherent tribal jurisdiction over nonmember activity. Cannon-Perciasepe
Memorandum, Attachment C.\16\ Because applicant tribes will no longer
need to demonstrate inherent jurisdiction, these parts of the guidance
are no longer relevant for TAS applications for CWA regulatory
programs, and there is no further utility for EPA to develop or seek
comment on factual findings relating to tribal inherent authority.
---------------------------------------------------------------------------

    \15\ ``Adoption of the Recommendations from the EPA Workgroup on
Tribal Eligibility Determinations,'' memorandum from Assistant
Administrator for Water Robert Perciasepe and General Counsel
Jonathan Z. Cannon to EPA Assistant Administrators and Regional
Administrators, March 19, 1998.
    \16\ The ``Cannon-Perciasepe'' approach and related guidance to
tribes are also reflected in subsequent EPA materials, including
portions of the ``Strategy for Reviewing tribal Eligibility
Applications to Administer EPA Regulatory Programs,'' memorandum
from Deputy Administrator Marcus Peacock, January 23, 2008.
---------------------------------------------------------------------------

    EPA intends to update its internal procedures and its training and
guidance for applicant tribes to reflect these changes consistent with
the express congressional delegation of authority to eligible tribes.

VII. Economic Analysis

    This rule entails no significant cost. Its only effect will be to
reduce the administrative burden for a tribe applying in the future to
administer a CWA regulatory program, and to potentially increase the
pace at which tribes seek such programs. See the discussion of
administrative burden and cost in section VIII.B (Paperwork Reduction
Act).

VIII. Statutory and Executive Order Reviews

    Additional information about these statutes and Executive Orders
can be found at http://www.epa.gov/laws-regulations/laws-and-executive-orders.

A. Executive Order 12866: Regulatory Planning and Review and Executive
Order 13563: Improving Regulation and Regulatory Review

    This interpretive rule is not a significant regulatory action and
was therefore not submitted to the Office of Management and Budget
(OMB) for review.

B. Paperwork Reduction Act (PRA)

    The information collection activities in this interpretive rule
have been submitted for approval to OMB under the PRA. The Information
Collection Request (ICR) document that EPA prepared has been assigned
EPA ICR number 2515.02. You can find a copy of the ICR in the docket
for this rule, and it is briefly summarized here. The information
collection requirements are not enforceable until OMB approves them.
    As discussed in section II.B, EPA's regulations require that a
tribe seeking to administer a CWA regulatory program must submit
information to EPA demonstrating that the tribe meets the statutory
criteria described in section II.A. EPA requires this information in
order to determine that the tribe is eligible to administer the
program.
    This rule streamlines the application by revising EPA's
interpretation of section 518 to eliminate the need for an applicant
tribe to demonstrate its inherent regulatory authority--

including demonstrating that it meets the Montana test where relevant--
which had been an element of TAS applications not included in the
statute. As described in the ICR, this rule reduces the burden by an
estimated 583 staff hours for a typical tribe, or 27 percent, and
reduces the cost of an application to a typical tribe for salaries and
contractor support by an estimated $70,554 per tribe, or 39 percent.
    Respondents/affected entities: Any federally recognized tribe with
a reservation can potentially apply to administer a regulatory program
under the CWA.
    Respondent's obligation to respond: The information discussed in
this rule is required from a tribe only if the tribe seeks to
administer a CWA regulatory program. See EPA's regulations cited in
section II.B of this rule.
    Estimated number of respondents: The total potential pool of
respondents is over 300 tribes with reservations. Although there are
567 federally recognized Indian tribes in the United States, the CWA
allows only those tribes with reservations to apply for authority to
administer programs. EPA estimates that about six tribes per year will
apply for TAS for a CWA regulatory program following this rule, an
increase from the existing rate of about four tribes per year. The pace
of applications could increase after the first few years as tribes
become more familiar with the post-rule process.
    Frequency of response: Application by a tribe to be eligible to
administer a CWA regulatory program is a one-time collection of
information.
    Total estimated burden: 9,642 tribal staff hours per year. Burden
is defined at 5 CFR 1320.3(b). EPA's ICR analysis included all
administrative costs associated with TAS applications even if some of
the costs are not strictly information collection costs. EPA was unable
to differentiate the information collection costs consistently and
reliably from other administrative costs such as program development
costs.
    This estimate could overstate actual burden because (a) EPA assumed
that all applications are first-time applications for CWA regulatory
programs, and thus the tribes submitting them would be unable to rely
on materials from previous applications for different regulatory
programs; (b) EPA used a liberal estimate of the annual rate of tribal
applications to ensure that the ICR does not underestimate tribal
burden; and (c) EPA used a simplifying steady-state assumption in
estimating annualized costs.
    Total estimated cost: $674,946, including tribal staff salaries and
the cost of contractors supporting tribal applicants. This rule does
not entail capital or operation and maintenance costs.
    An agency may not conduct or sponsor, and a person is not required
to respond to, a collection of information unless it displays a
currently valid OMB control number. The OMB control numbers for EPA's
regulations in 40 CFR are listed in 40 CFR part 9. When OMB approves
this ICR, the Agency will announce that approval in the Federal
Register and publish a technical amendment to 40 CFR part 9 to display
the OMB control number for the approved information collection
activities contained in this final rule.

C. Regulatory Flexibility Act (RFA)

    I certify that this interpretive rule will not have a significant
economic impact on a substantial number of small entities under the
RFA. This rule will not impose any requirements on small entities. This
rule affects only Indian tribes that seek to administer CWA regulatory
programs.

D. Unfunded Mandates Reform Act (UMRA)

    This interpretive rule does not contain any unfunded mandate as
described in UMRA, 2 U.S.C. 1531-1538, and does not significantly or
uniquely affect small governments. The rule imposes no enforceable duty
on any state, local or tribal governments or the private sector.

E. Executive Order 13132: Federalism

    This interpretive rule does not have federalism implications. It
will not have substantial direct effects on the states, on the
relationship between the national government and the states, or on the
distribution of power and responsibilities among the various levels of
government.
    This rule applies only to tribal governments that seek eligibility
to administer CWA regulatory programs. Although it could be of interest
to some state governments, it does not apply directly to any state
government or to any other entity. As discussed in section V.C.8, the
rule has no effect on the scope of existing state regulatory programs
approved by EPA under the CWA.
    In the spirit of Executive Order 13132, and consistent with EPA
policy to promote communications between EPA and state and local
governments, EPA consulted with representatives of state governments to
obtain meaningful and timely input before and after proposal for
consideration in this rulemaking. By letter dated June 18, 2014, EPA
invited ten national and regional state associations \17\ to a July 8,
2014, informational meeting at EPA in Washington, DC. As a result of
this meeting and other outreach, EPA participated in several follow-up
meetings with interested associations and their members as well as
certain individual states during the months of June-September, 2014. By
letter dated August 7, 2015, to the same groups, EPA resumed
consultation after the proposal, including conducting a webinar on
September 3, 2015. Records of these meetings and copies of written
comments and questions submitted by states and state associations are
included in the docket for this rule.
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    \17\ The National Governors Association, the National Conference
of State Legislatures, the Council of State Governments, the Western
Governors Association, the Southern Governors Association, the
Midwestern Governors Association, the Coalition of Northeastern
Governors, the Environmental Council of the States, the Association
of Clean Water Administrators, and the Western States Water Council.
In May and June 2015, EPA held additional informational meetings
with the state environmental chiefs of the National Association of
Attorneys General, members of the legal network of the Environmental
Council of the States, and member states of the Western Governors'
Association.
---------------------------------------------------------------------------

    In the public comments, two states expressed support for tribal
opportunities to obtain TAS. Some participants disagreed with or
questioned in whole or in part the Agency's rationale for the
reinterpretation. Others questioned whether the proposal would affect
the geographic scope of tribal authority under the CWA and how the
proposal would affect a state's ability to challenge a tribe's
application. Some states also had questions about issues unique to
their situations.
    EPA considered all of the state comments in developing this final
interpretive rule. EPA's responses are included in sections IV and V of
this rule and in the Response to Comments document in the docket for
this rulemaking.

F. Executive Order 13175: Consultation and Coordination With Indian
Tribal Governments

    This interpretive rule has tribal implications because it will
directly affect tribes applying in the future to administer CWA
regulatory programs. However, because it neither imposes substantial
direct compliance costs on federally recognized tribal governments, nor
preempts tribal law, tribal consultation was not required by Executive
Order 13175. In any event, EPA consulted and coordinated with tribal
officials under the EPA Policy on Consultation and Coordination with

Indian Tribes early in the process of developing this rule, and again
after its proposal, to permit them to have meaningful and timely input
into its development. A summary of that consultation and coordination
follows.
    EPA initiated a tribal consultation and coordination process before
proposing this rule by sending a ``Notification of Consultation and
Coordination'' letter on April 18, 2014, to all of the 566 then
federally recognized tribes. EPA contacted all federally recognized
tribes, even though only tribes with reservations can apply for TAS
under the CWA, because it is possible that additional tribes could
acquire reservation lands in the future. The letter invited tribal
leaders and designated consultation representatives to participate in
the tribal consultation and coordination process. EPA held two
identical webinars concerning this matter for tribal representatives on
May 22 and May 28, 2014. A total of 70 tribal representatives
participated in the two webinars, and tribes and tribal organizations
sent 20 pre-proposal comment letters to EPA. On August 7, 2015, EPA
resumed the consultation and coordination process with tribes. A total
of 44 tribal representatives participated in webinars in September
2015.
    EPA received 21 comment letters from tribes and tribal associations
during the public comment period. All tribal comments supported the
proposal. Some tribes had questions about how EPA would handle
reservation land status and boundary matters. Some comments urged EPA
to help find solutions to tribal funding limitations. EPA will continue
to consider tribal resource issues in its budgeting and planning
process. However, EPA cannot assure tribes that additional funding will
be available for a tribe to develop or implement a CWA regulatory
program.
    EPA considered all of the tribal comments in developing this
interpretive rule. EPA's responses are included in sections IV and V of
this rule and in the Response to Comments document in the docket for
this rulemaking,

G. Executive Order 13045: Protection of Children From Environmental
Health Risks and Safety Risks

    EPA interprets Executive Order 13045 as applying only to those
regulatory actions that concern environmental health or safety risks
that EPA has reason to believe may disproportionately affect children,
per the definition of ``covered regulatory action'' in section 2-202 of
the Executive Order. This interpretive rule is not subject to Executive
Order 13045 because it does not concern an environmental health or
safety risk.

H. Executive Order 13211: Actions Concerning Regulations That
Significantly Affect Energy Supply, Distribution, or Use

    This interpretive rule is not subject to Executive Order 13211
because it is not a significant regulatory action under Executive Order
12866.

I. National Technology Transfer and Advancement Act (NTTAA)

    This rulemaking does not involve technical standards.

J. Executive Order 12898: Federal Actions To Address Environmental
Justice in Minority Populations and Low-Income Populations

    The human health or environmental risks addressed by this action
will not have potential disproportionately high and adverse human
health or environmental effects on minority, low-income, or indigenous
populations. This rule affects the procedures tribes must follow to
seek TAS for CWA regulatory purposes and does not directly affect the
level of environmental protection.

K. Congressional Review Act (CRA)

    This interpretive rule is exempt from the CRA because it is a rule
of agency organization, procedure or practice that does not
substantially affect the rights or obligations of non-agency parties.

    Dated: May 5, 2016.
Gina McCarthy,
Administrator.
[FR Doc. 2016-11511 Filed 5-13-16; 8:45 am]
 BILLING CODE 6560-50-P