otherwise already publicly available.
    The Agency is not proposing to require that the project proponent
submit a final license or permit in its certification request because a
final Federal license or permit may not be issued until after a
certification or waiver is obtained by the project proponent. 33 U.S.C.
1341(a)(1) (``No license or permit shall be granted until certification
required by this section has been obtained or has been waived as
provided in the preceding sentence.'') Therefore, requiring a copy of
the final license or permit to initiate the certification process would
be inconsistent with the plain language of section 401.
    The Agency is requesting comment on its proposed approach. The
Agency is also requesting comment on an alternative approach, under
which a project proponent may submit either a copy of its officially
submitted license or permit application or a copy of the draft license
or permit and any existing and readily available data or information
related to potential water quality impacts from the proposed project.
2. Additional Contents in a Request for Certification
    As discussed above, the Agency is proposing that every request for
certification include a copy of the draft license or permit and any
existing and readily available data or information related to potential
water quality impacts from the proposed project. The Agency is also
proposing to identify a set of additional contents that a project
proponent must include in a request for certification when EPA acts as
the

certifying authority. The Agency is also proposing that the same set of
additional contents would be required in each request for certification
to a state or authorized tribe that has not established its own
definition of a ``request for certification'' under state or tribal
law. These additional contents would not apply where a state or
authorized tribe has established its own list of requirements for a
request for certification. As discussed above, this proposed approach
contrasts with the approach taken in the 2020 Rule, which defines the
contents of a certification request for all certifying authorities.
However, it is a reasonable--and more flexible--approach to defining
the term ``request'' and consistent with NYSDEC. That decision holds
that the reasonable period of time begins after receipt of a request
for certification and not when a state deems it ``complete;'' it does
not preclude EPA or other certifying authorities from defining--in
advance--those contents a certification request must contain. As
discussed below, this approach is consistent with stakeholder input and
the cooperative federalism principles central to section 401 and the
CWA.
    The Agency agrees it is important for project proponents to have
clarity and certainty during the certification process. In order to
effectuate Congress' goals for section 401 in the limited amount of
time provided by the Act, it is reasonable that certifying authorities
should be able to define what information, in addition to a draft
license or permit and any existing and readily available data or
information related to potential water quality impacts from the
proposed project, is necessary to make an informed decision regarding
protecting their water quality from adverse effects from a federally
licensed or permitted activity. See discussion in Section IV.A in this
preamble on the legislative history of section 401. This approach will
allow certifying authorities to act on certification requests in a
timely and informed manner, while providing project proponents with
clarity regarding expectations for the certification process. Pre-
proposal input on this rulemaking revealed that defining an exclusive
list of components for certification requests for all certifying
authorities would not necessarily result in a more efficient or timely
process. As noted above, several stakeholders asserted that the 2020
Rule led to workload challenges, general confusion for project
proponents, and, in at least one state, an increase in denials. The
Agency's proposed approach here will allow for a transparent and timely
process that respects the role of state and tribal certifying
authorities under the cooperative federalism framework of section 401.
    First, this proposed approach will reduce project proponent
confusion. In all instances, the proposed rule defines the term
``request for certification'' to include a copy of a draft license or
permit and any existing and readily available data or information
related to potential water quality impacts from the proposed project.
It then defines additional contents that a certification request must
include when EPA acts as a certifying authority or where a state or
authorized tribe does not define a certification request in its
regulations. Providing a defined list of additional contents for a
certification request where EPA acts as a certifying authority, or
where a state or tribe does not have a defined list in regulation, will
provide project proponents with clear expectations for starting the
process. Implicit in this requirement is an understanding that
certifying authorities that wish to define their own additional
requirements for a certification request have the authority to do so in
regulation. Additionally, this proposed approach should be familiar to
project proponents who would have followed specific requirements
established by states and tribes during the last approximately 50
years. The proposed approach also addresses project proponent concerns
about certifying authorities that, in the past, may have unexpectedly
required additional information from the project proponent to satisfy
the request for certification requirement before starting the clock on
the ``reasonable period of time.'' Under the approach EPA proposes
here, the reasonable period of time starts after receipt of a ``request
for certification,'' which is defined to mean a request that contains
the contents required by EPA's proposed regulations and any additional
state or tribal requirements.
    Second, this approach will allow certifying authorities to act on
certification requests in a more efficient manner. The Agency generally
agrees with stakeholders that the Agency cannot tailor the requirements
of a certification request to fit every project or state or tribal law.
This proposed approach recognizes the importance of ensuring that
states and tribes are empowered to determine what information is
necessary to initiate the certification process. Although this proposed
rule does not preclude certifying authorities from asking for more
information once they receive a certification request and the
reasonable period of time begins, allowing states and authorized tribes
to define additional contents of a certification request may reduce the
need for such additional requests.
    Although the Agency is proposing to allow states and authorized
tribes to define their own additional requirements for a certification
request, the proposed approach provides a clear backstop for those
states or authorized tribes who do not choose to define any additional
requirements in regulation. The Agency expects that those states and
authorized tribes who choose to define additional contents for a
certification request would do so clearly enough to provide project
proponents with full transparency as to what is required. As discussed
above, some certifying authorities rely on a ``complete application''
to start the certification review process. In the Agency's view, a
state requirement for submittal of a complete application, when the
contents of such complete application are clearly defined in
regulation, will not necessarily lead to a ``subjective standard.''
NYSDEC, 884 F.3d at 455-56. In fact, the Agency observes that the use
of a ``completeness'' standard for applications or similar documents is
not a novel concept in CWA implementing regulations.\35\ Both EPA and
the Corps have developed regulations setting out requirements for
``completeness'' or ``complete applications'' to initiate the
permitting process. See 40 CFR 122.21(e) (describing ``completeness''
for NPDES applications); 33 CFR 325.1(d)(10) (describing when an
application is deemed ``complete'' for section 404 permits). Neither
CWA section 402 or section 404 uses the word ``complete'' to modify the
term ``application'' in the statute, yet the agencies have reasonably
interpreted the term ``application'' in those contexts to allow for a
``completeness'' concept that provides a clear and consistent framework
for stakeholders involved in the section 402 and 404 permitting
processes. The Agency is unaware of significant issues with the use of
``complete applications'' in either the section 402 or section 404
permitting processes or a concern that it has led to a ``subjective
standard.''
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    \35\ The use of ``complete'' applications is also applied in
other Federal environmental realms (e.g., the Safe Drinking Water
Act, the Clean Air Act). See, e.g., 40 CFR 144.31, 40 CFR 51.103,
appendix V to part 51.
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    The Agency is requesting comment on this proposed approach,
including any examples or data about state or tribal certification
request practices, including

a requirement for a ``complete request,'' that may have delayed the
certification process. The Agency also requests comment on examples or
circumstances where a certifying authority has applied a subjective or
open-ended definition of ``complete application'' to certification
requests, including examples of such in certifying authority
regulations. EPA is also seeking comment on whether it should take an
alternate approach whereby the Agency would define the minimum
additional components of a certification request for all certifying
authorities and if so, what those minimum additional components should
include (e.g., the minimum additional components proposed to apply to
EPA when it acts as a certifying authority, as discussed below).
    The Agency is proposing to require that a certification request
made to EPA, or to states or tribes without their own definitions of
``request for certification'' as discussed above, include five
additional components. As discussed below, these five components
contain some similarities to the 1971 Rule, with revisions to provide
further clarification and efficiency for project proponents and EPA
when it acts as a certifying authority and when a state or authorized
tribe has not established its own definition of ``request for
certification.''
    As stated above, the statute does not define the contents of a
``request for certification'' to EPA, nor does the legislative history
discuss these components. The 1971 Rule required project proponents to
submit a signed certification request with ``a complete description of
the discharge involved in the activity'' to EPA when it acts as the
certifying authority. 40 CFR 121.22 (2019). Specifically, the 1971
regulation required project proponents to include five mandatory
components to provide a ``complete description of the discharge.'' Id.
    The 2020 Rule precludes state or tribal definitions of what must be
included in a ``certification request.'' Instead, it provides a general
definition of ``certification request'' applicable to all certifying
authorities and two different lists of documents and information that
must be included in all certification requests: one list for individual
licenses and permits and a separate list for the issuance of a general
license or permit. 40 CFR 121.5; see also 85 FR 42285. The preamble
asserted that these were objective components that would not ``require
subjective determinations about whether the request submittal
requirements have been satisfied.'' 85 FR 42246. The nine components
for a certification request on an individual license or permit are
similar to the 1971 Rule, with additional components that required
project proponents to include documentation of a pre-filing meeting
request, a list of other project authorizations, and attestations
regarding the contents of the request and that a request was being
submitted. Id. at 42285.
    Prior to the 2020 Rule, some states and authorized tribes
established their own requirements for a certification request that
included more information than the 2020 Rule. In pre-proposal outreach
for this rulemaking, several certifying authorities noted that the 2020
Rule's list of components for a certification request failed to account
for information that may be required to comply with state public notice
requirements \36\ and state antidegradation policies. As a result,
these certifying authorities asserted that the list limited their
ability to engage in robust, meaningful public engagement on
certification requests or ensure that a project would comply with EPA-
approved water quality standards.
---------------------------------------------------------------------------

    \36\ CWA section 401(a)(1) states that a ``State or interstate
agency shall establish procedures for public notice in the case of
all applications for certification by it.''
---------------------------------------------------------------------------

    As noted above, although the Agency is proposing that all requests
for certification must include a copy of the draft license or permit
and any existing and readily available data or information related to
potential water quality impacts from the proposed project, the Agency
is declining to define the additional contents of a certification
request for those states or authorized tribes who have regulations that
identify the contents of a certification request because it is
difficult to tailor the contents at a national level to fit all state
and tribal laws and regulations. However, EPA is proposing to define
additional contents of a certification request for EPA when it acts as
a certifying authority and for states or authorized tribes who do not
have regulations on the components of a certification request. EPA is
proposing that a certification request to EPA when it acts as the
certifying authority, or to a state or tribe who does not have
regulations on the components of a certification request, must also
contain the following five components, if not already included in the
draft license or permit:
    1. The name and address of the project proponent;
    2. The project proponent's contact information;
    3. Identification of the applicable Federal license or permit,
including Federal license or permit type, project name, project
identification number, and a point of contact for the Federal agency;
    4. Where available, a list of all other Federal, interstate,
tribal, state, territorial, or local agency authorizations required for
the proposed activity and current status of each authorization; and
    5. Documentation that a pre-filing meeting request was submitted to
the certifying authority in accordance with applicable submission
requirements, unless a pre-filing meeting request has been waived.
    Like the 1971 Rule and 2020 Rule, the Agency proposes to require
basic background information about the project proponent, including
name, address, and contact information. Consistent with the definition
for ``project proponent'' proposed at Sec.  121.1(j), this information
may include the name, address, and contact information for a project
proponent's agent or contractor, where relevant, in addition to the
primary project proponent. This additional contact information is
important for the Agency to ensure that the appropriate representatives
are aware of the certification requirements and can be contacted
throughout the certification process. The proposed rule also requires
project proponents to identify the Federal license or permit for which
they are seeking certification, including information that identifies
the license or permit type, name, and number, as well as a point of
contact at the respective Federal licensing or permitting agency.
Similar to the 2020 Rule, the Agency also proposes to require that the
project proponent provide a list of other authorizations that are
required for the proposed activity and the current status of such
authorizations, where applicable. This requirement will allow the
Agency to assess how water quality impacts may be addressed through
other Federal, state, or local authorizations and potentially reduce
redundancies or inconsistencies between the certified license or permit
and other authorizations. When the project proponent is a Federal
agency seeking certification, the Agency does not expect the Federal
agency to be able to produce such a list. Typically, when a Federal
agency seeks certification, it is seeking certification on general
licenses or permits that would be used by future project applicants.
Therefore, at the time of the request for certification, the Federal
agency is likely unable to provide any information on which
authorizations, if any, are required for such a future project. Similar
to the 2020 Rule, the Agency also proposes to

require a project proponent to submit documentation that the proponent
requested a pre-filing meeting, unless a pre-filing meeting request has
been waived. The documentation should be in writing, such as a copy of
the email requesting the pre-filing meeting. As discussed in section
V.B in this preamble, a certifying authority may waive the requirement
for a pre-filing meeting request. In that event, the project proponent
would not need to produce documentation of a pre-filing meeting
request.
    The Agency is not proposing to retain the contents of the 2020 Rule
at Sec.  121.5(b)(4) and (5) and (8) and (9); the 1971 Rule also
contained similar contents to Sec.  121.5(b)(4) and (5). See 40 CFR
121.22(b)-(c), (e) (2019). Section 121.5(b)(4) and (5) are unnecessary
since the proposed rule requires a project proponent to provide a copy
of the draft license or permit and any existing and readily available
data or information related to potential water quality impacts from the
proposed project in its request. The Agency also finds it unnecessary
to retain the requirements at Sec.  121.5(b)(8) and (9). EPA included
the component at Sec.  121.5(b)(8) ``to create additional
accountability on the part of the project proponent to ensure that
information submitted in a certification request accurately reflects
the proposed project.'' 85 FR 42245 (July 13, 2020). EPA is unaware of
any issues or concerns that project proponents will not provide
accurate information in the request for certification without such
attestation. Furthermore, the proposed contents for a request for
certification include a copy of the draft license or permit, which
presumably incorporates accurate information about the proposed
project. Additionally, it is unnecessary for a project proponent to
provide specific language explicitly requesting certification because a
project proponent is required to submit a request for certification as
defined in this proposal. Submitting a request for certification as
defined in this proposal should be a clear indication to the certifying
authority that the project proponent is seeking certification. Although
the Agency is defining the additional components of a certification
request when it acts as a certifying authority, this does not preclude
EPA from asking for additional information after a certification
request is submitted, if the Agency determines additional information
is necessary to inform its decision-making on a request for
certification.
    The Agency is proposing to require a copy of the draft license or
permit and any existing and readily available data or information
related to potential water quality impacts from the proposed project in
all requests for certification of both individual and general licenses
and permits. Additionally, the Agency is proposing to require that any
additional requirements for a request for certification apply to both
requests for individual and general licenses or permits. Unlike the
2020 Rule, the Agency is not proposing to retain a separate list of
additional requirements for general licenses and permits. See 40 CFR
121.5(c). In the 2020 Rule, EPA introduced a separate list of contents
for a request for certification on the issuance of a general license or
permit ``to account for the distinctions between issuing a general
license or permit and issuing a license or permit for a specific
project, with respect to the available information at the time of
certification.'' 85 FR 42281 (July 13, 2020). However, EPA does not
think there are any information needs beyond the proposed additional
requirements unique or specific to a general license or permit. EPA is
requesting comment on whether there are such different needs and
whether it should create a separate list of additional requirements for
general licenses or permits.
    EPA is requesting comments on its proposed list of additional
components for a certification request when EPA acts as the certifying
authority, or where a state or tribe does not define such additional
requirements in regulation. Additionally, the Agency is requesting
comment on the components as they would apply to state and authorized
tribal certification requests, including where available, citations to
existing regulations or any data on the time it takes project
proponents to comply with these requirements.
    The Agency also requests comment on an alternative approach where
the project proponent would be required to submit (1) a Federal license
or permit application instead of a copy of the draft license or permit,
(2) any existing and readily available data or information related to
potential water quality impacts from the proposed project, and (3) an
additional set of components. Under this alternative approach, the
project proponent would be required to submit ``proposed activity
information'' with six components, including the following:
    1. A description of the proposed activity, including the purpose of
the proposed activity and the type(s) of discharge(s) that may result
from the proposed activity;
    2. The specific location of any discharge(s) that may result from
the proposed activity;
    3. A map and/or diagram of the proposed activity site, including
the proposed activity boundaries in relation to local streets, roads,
highways;
    4. A description of current activity site conditions, including but
not limited to relevant site data, photographs that represent current
site conditions, or other relevant documentation;
    5. The date(s) on which the proposed activity is planned to begin
and end and, if known, the approximate date(s) on which any
discharge(s) will take place; and
    6. Any additional information to inform whether any discharge from
the proposed activity will comply with applicable water quality
requirements.
    This alternative additional information would incorporate some of
the information requirements from the 1971 Rule and 2020 Rule and add
other items to reflect the additional information that the Agency views
necessary to initiate its analysis of a certification request on a
Federal license or permit application.
    EPA is also proposing to make conforming changes to the part 124
regulations governing the contents of a request for certification of
EPA-issued NPDES permits. EPA is proposing to delete 40 CFR 124.53(b),
which provides that when EPA receives a permit application without
certification, EPA shall forward the application to the certifying
authority with a request that certification be granted or denied. EPA
is proposing to delete Sec.  124.53(b) because this provision allows a
request for certification to precede development of a draft NPDES
permit, which is inconsistent with the approach proposed at Sec.
121.5(a). It is worth noting that although Sec.  124.53 currently
allows for a request for certification on a permit application, EPA
typically requests certification on draft NPDES permits.
    EPA is also proposing to delete 40 CFR 124.53(c), which identifies
the required contents of a request for certification of an EPA-issued
NPDES permit (if certification has not been received by the time the
draft permit is prepared). EPA is proposing to delete Sec.  124.53(c)
because EPA intends that all requests for certification--including all
requests for certification on EPA-issued NPDES permits--follow the
regulations proposed at Sec.  121.5. The list of contents at Sec.
124.53(c) differs significantly from the list of contents proposed at
Sec.  121.5(c). Further, unlike proposed Sec.  121.5(b), Sec.
124.53(c) is unclear regarding whether requests for

certification on EPA-issued NPDES permits must follow state regulations
regarding the contents of a request for certification. Also, as
explained at the end of Section V.D.2 of this preamble, the statement
required at Sec.  124.53(c)(3) regarding the reasonable period of time
is not consistent with the approach to the reasonable period of time
proposed at Sec.  121.6.
3. Defining ``Receipt'' of a Request for Certification
    EPA is also proposing to define the term ``receipt'' to clarify
that the reasonable period of time begins on the date that a certifying
authority receives a certification request as defined by this proposal,
with any additional components identified by the certifying authority
in its regulations, and in accordance with its applicable submission
procedures. The statute does not define the term ``receipt of such
request'' nor does it define how a certification request must be
received by a certifying authority. The 1971 Rule does not address or
define the term ``receipt'', however, the Agency opted to define the
term in the 2020 Rule. 40 CFR 121.1(m). The 2020 Rule defined the term
``receipt'' as ``the date that a certification request is documented as
received by a certifying authority in accordance with applicable
submission procedures.'' Id. In implementation of the 2020 Rule, there
was some confusion regarding whether it was the Federal agency's or
certifying authority's responsibility to determine that a certification
request, as defined by the 2020 Rule, was received. The proposed
definition in this proposal clarifies that receipt occurs when the
certifying authority receives a certification request that meets its
definition for a certification request and complies with applicable
submission procedures.
    First, the proposed definition of ``receipt'' acknowledges that a
request for certification may largely be defined by the certifying
authority. As discussed above, the Agency is proposing to require a
copy of the draft license or permit and any existing and readily
available data or information related to potential water quality
impacts from the proposed project in all requests for certification,
but only require additional components in a request for certification
when EPA acts as the certifying authority, or where a state or
authorized tribe does not define a certification request in its own
regulations. Beyond these proposed Federal regulatory requirements,
states and authorized tribes remain free to identify their own
additional contents of a request for certification under state or
tribal law.
    Second, the proposed definition of ``receipt'' requires a
certification request to be submitted in accordance with the certifying
authority's applicable submission procedures. Applicable submission
procedures describe the manner in which a certifying authority will
accept a certification request, e.g., through certified mail or
electronically. The Agency understands that certifying authorities may
have different procedures for receiving certification requests (e.g.,
receiving certification in different formats or requiring the payment
of fees), and as such, is not defining a set of standard applicable
submission procedures. However, EPA encourages certifying authorities
to make their applicable submission procedures publicly available and,
where possible, to discuss these procedures at pre-filing meetings. EPA
is requesting comment on whether it should define applicable submission
procedures.
    The statute further provides that the reasonable period of time
begins ``after receipt of such request.'' 33 U.S.C. 1341(a)(1). The
Agency interprets this to mean that the reasonable period of time
begins on the date that the certifying authority receives a
certification request that meets the proposed rule's requirements for a
certification request, includes any additional certification request
components identified in the certifying authority's regulation, and is
delivered in accordance with the certifying authority's applicable
submission procedures. See proposed Sec.  121.6(a). The Agency's
proposed rulemaking allows the certifying authority the opportunity to
confirm that it received a request for certification consistent with
this proposal, its additional requirements, and in accordance with its
applicable submission procedures. The Agency is proposing to require
the certifying authority to confirm in writing for the project
proponent and Federal agency the date it received a certification
request that meets its definition and is submitted in accordance with
its applicable submission procedures. Because the certifying authority
must confirm receipt of the request for certification after it receives
a request from a project proponent, EPA is proposing to remove the
regulatory text at Sec.  121.5(a), which requires a project proponent
to submit a certification request to a certifying authority and Federal
agency. Similarly, the Agency is also proposing to remove the
regulatory text located at Sec.  121.6(b), which requires the Federal
agency to communicate the date of receipt of the request for
certification, the reasonable period of time, and the date waiver will
occur. The certifying authority is responsible for confirming the date
of receipt of a request for certification with the project proponent
and Federal agency. As discussed in the next section of this preamble,
the Federal agency and the certifying authority may collaboratively set
the reasonable period of time. As such, it is unnecessary for the
Federal agency to communicate the length of the reasonable period of
time and date of waiver to the certifying authority. The Agency is
requesting comment on whether there should be a specified timeframe for
when the certifying authority should send written confirmation to the
project proponent and Federal agency of the date of receipt of the
request for certification. The Agency is requesting comment on its
proposed definition for receipt and the start of the reasonable period
of time.

C. Reasonable Period of Time

1. Reasonable Period of Time Determination
    Under section 401, when a certifying authority receives a request
for certification, the certifying authority must act on that request
within a ``reasonable period of time (which shall not exceed one
year).'' 33 U.S.C. 1341(a)(1). The proposed rule provides Federal
agencies and certifying authorities with the ability to jointly set the
reasonable period of time, provided the reasonable period of time does
not exceed one year from the receipt of the request for certification.
Additionally, after the reasonable period of time is set, the Federal
agency and certifying authority may agree to extend the reasonable
period of time, provided that it does not exceed one year from receipt.
    Section 401(a)(1) provides that a certifying authority waives its
ability to certify a Federal license or permit if it does not act on a
certification request within the reasonable period of time. 33 U.S.C.
1341(a)(1) (``If the State, interstate agency, or Administrator, as the
case may be, fails or refuses to act on a request for certification,
within a reasonable period of time (which shall not exceed one year)
after receipt of such request, the certification requirements of this
subsection shall be waived with respect to such Federal
application.''). Other than specifying its outer bound (one year), the
CWA does not define what length of time is ``reasonable.'' The 1971
Rule reiterated that a certifying authority would waive its opportunity
to certify if it did not act within ``a reasonable period of time''

and provided that: (1) the Federal licensing or permitting agency
determines the length of the reasonable period of time, and (2) the
reasonable period of time ``shall generally be considered to be six
months, but in any event shall not exceed one year.'' See 40 CFR
121.16(b) (2019).
    The 2020 Rule provides that the Federal agency sets the reasonable
period of time and defined a process for how it should be determined.
See 40 CFR 121.6. This process specifies when a Federal agency must
communicate the reasonable period of time to the certifying authority
and identifies factors that the Federal agency must consider when
setting the reasonable period of time. See id.; 85 FR 42259-60 (July
13, 2020). The 2020 Rule does not maintain the 1971 Rule's six-month
default and reiterates that the reasonable period of time could not
exceed one year from receipt of the certification request. 40 CFR
121.6. The 2020 Rule also defines the term ``reasonable period of
time'' as the length of time, which is determined in accordance with
Sec.  121.6, during which the certifying authority may act on a request
for certification. 40 CFR 121.1(l).
    Some Federal agencies have promulgated regulations describing a
reasonable period of time for section 401 certification in relation to
those agencies' licenses or permits. For example, FERC has explicitly
defined the ``reasonable period'' for certifying authority action under
section 401 to be one year. See 18 CFR 4.34(b)(5)(iii), 5.23(b)(2),
157.22(b). The Corps has routinely implemented a 60-day reasonable
period of time for section 401 decisions commencing when the certifying
authority receives a section 401 certification request. See 33 CFR
325.2(b)(1)(ii).\37\ EPA has established a 60-day reasonable period of
time for certifying authorities to act on requests for certifications
for draft NPDES permits. See 40 CFR 124.53(c)(3).
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    \37\ But see U.S. EPA and Department of the Army, Clean Water
Act Section 401 Certification Implementation Memorandum (August 19,
2021) (interim joint guidance from EPA and Army Corps extending the
reasonable period of time to the full statutory year for certain
nationwide permits).
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    While project proponents generally supported the reasonable period
of time provisions in the 2020 Rule, most states, tribes, and non-
governmental organizations expressed concern with various aspects of
its provisions. Many states and tribes expressed concern that the
Federal agency is afforded the sole authority to set the reasonable
period of time, and some recommended that the certifying authority
alone should be able to determine the reasonable period of time. Some
stakeholders suggested that a rule replacing the 2020 Rule should at
least require the Federal agency and certifying authority to
collaborate and agree on the reasonable period of time. Some certifying
authorities also pointed out that short reasonable periods of time
(e.g., 60 days) do not allow the state or tribe sufficient time to
fulfill certain state or tribal law requirements, such as public notice
requirements, or allow them to obtain all the information they need
about a project to make an informed certification decision. As a
result, these certifying authorities asserted that for complex
projects, their only realistic options are to waive or deny
certification. EPA expressed similar concerns in its notice of intent
to revise the 2020 Rule. See 86 FR 29543 (June 2, 2021) (``Among other
issues, EPA is concerned that the rule does not allow state and tribal
authorities a sufficient role in setting the timeline for reviewing
certification requests. . . .'').
    This proposed rulemaking not only affirms and clarifies that--
consistent with the statutory text--the reasonable period of time may
not exceed one year from receipt of the certification request, but it
also proposes that the Federal agency and certifying authority
collaboratively set the reasonable period of time on a project-by-
project or project type basis (e.g., through development of procedures
and agreements), provided that it does not exceed one year. Under this
proposal, if the Federal agency and certifying authority do not agree
upon a reasonable period of time, the default reasonable period of time
would be 60 days from the receipt of the request for certification. The
proposed rulemaking also allows for extensions of the reasonable period
of time under certain circumstances. Additionally, the Agency is
proposing to remove as unnecessary the definition for ``reasonable
period of time,'' currently located at Sec.  121.1(l). Like that
definition, the proposed language in Sec.  121.6(b) itself provides
that the reasonable period of time is the time during which the
certifying authority must act on a request for certification. As a
result, the Agency finds it duplicative and unnecessary to include a
separate definition for the term ``reasonable period of time.''
    EPA understands that, in most cases, acting within the reasonable
period of time is not a major issue for most certifying authorities.
Several stakeholders noted in pre-proposal input that the majority of
section 401 certifications are issued in well under a year. See
Economic Analysis for the Proposed Rule (based on pre-proposal input
and website information, most states issue certification decisions in
60-90 days); see also 85 FR 42215 (July 13, 2020) (``EPA acknowledges
that [] many certifications reflect an appropriately limited
interpretation of the purpose and scope of section 401 and are issued
without controversy . . . .'').
    However, a too short or inflexible reasonable period of time can
present a major issue in certain circumstances, e.g., for complex,
multi-jurisdictional projects, and in jurisdictions with longer public
notice requirements. In pre-proposal input, several certifying
authorities said they needed more (rather than less) time to make
certification decisions due to a lack of necessary information from
project proponents. See also Economic Analysis for the Proposed Rule
(noting that some pre-proposal input revealed that project size,
project complexity, sufficiency of project proponent information, and
public notice processes impacted whether additional time was
necessary). Several stakeholders recommended that EPA establish a
default reasonable period of time of one full year.
    The collaborative approach EPA is proposing (i.e., the Federal
agency and certifying authority jointly set the reasonable period of
time with a default of 60 days if an agreement is not reached) differs
from the approach in both the 1971 Rule and the 2020 Rule where the
reasonable period of time is determined by the Federal agency. See 40
CFR 121.16(b) (2019) and 40 CFR 121.6(a). Such an approach is not
compelled by the statutory text because CWA section 401(a)(1) is silent
regarding who, if anyone, determines the reasonable period of time. Nor
does it say that the Federal agency is the only entity that may
establish the reasonable period of time. Given that statutory
ambiguity, EPA has flexibility under Chevron to establish regulatory
provisions regarding the establishment of a reasonable period of time.
Chevron U.S.A., Inc. v. Natural Res. Def. Council, Inc., 467 U.S. 837
(1984).
    EPA is proposing to provide Federal agencies and certifying
authorities with an opportunity to collaboratively set the reasonable
period of time, in lieu of relying on a regulatory default of 60 days.
Under this approach, Federal agencies and certifying authorities can
offer each other their expertise relevant to determining what period of
time is reasonable. Federal agencies are in the best position to opine
on timing in relation to their Federal licensing or permitting process.
Likewise, because certifying authorities regularly issue their own
permits for activities that may impact water quality (e.g., NPDES

permits, above and below ground pipelines, etc.) they also have
expertise in the time needed to evaluate potential water quality
impacts from federally licensed or permitted activities. Certifying
authorities are also best positioned to opine on the impacts of state
or tribal law governing the timing of decisions with respect to
environmental review and public participation requirements.\38\ Given
that EPA is proposing to defer to the combined expertise of the Federal
agencies and certifying authorities for establishing the reasonable
period of time, this proposal does not retain the list of factors that
a Federal agency shall consider, under the 2020 Rule at Sec.  121.6(c),
when establishing the reasonable period of time. Above all, this
proposed approach addresses state and tribal stakeholders' concerns
that, under the 2020 Rule, certifying authorities do not have enough
influence in determining the length of the reasonable period of time
for a particular project.
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    \38\ Section 401(a)(1) requires a State or interstate agency to
establish procedures for public notice in the case of all
applications for certification by it and, to the extent it deems
appropriate, procedures for public hearings in connection with
specific applications. However, section 401(a)(1) itself does not
set any requirements or time limits on those public notice
procedures or how those procedures should be considered when setting
the reasonable period of time. EPA is aware that some certifying
authorities have public notice procedures that exceed the default
reasonable period of time in place for some Federal agencies (e.g.,
longer than the Corps or EPA's default 60-day reasonable period of
time for federally issued CWA section 404 and 402 permits).
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    Under the proposed approach, during the first 30 days after a
certifying authority receives a request for certification, the Federal
agency and certifying authority would attempt to agree in writing to
the length of a reasonable period of time. EPA recommends that the
Federal agency and the certifying authority discuss the length of a
reasonable period of time at the pre-filing meeting, particularly
because the project proponent participates in that meeting and will,
therefore, be informed of any reasonable period of time related
discussions and decisions. Although the Agency is not proposing to list
factors that Federal agencies and certifying authorities must consider
when establishing the reasonable period of time, EPA observes that
Federal agencies and certifying authorities might consider various
factors, such as project type, complexity, location, and scale; the
certifying authority's administrative procedures; and the potential for
the licensed or permitted activity to affect water quality. Federal
agencies and certifying authorities might also elect to establish joint
reasonable period of time procedures and agreements through a
memorandum of agreement (MOA). Such MOAs could apply to all potential
projects or only to projects of a specified type. As discussed further
below, such MOAs could also address how and when the agencies might
change or extend the reasonable period of time. Alternatively, Federal
agencies and certifying authorities might prefer to establish the
reasonable period of time on a project-by-project basis. Whichever
approach is taken to establish the reasonable period of time, the
certifying authority must inform the Federal agency of the date of
receipt of a certification request that meets the certifying
authority's applicable submission procedures to signal the start of the
reasonable period of time clock. See proposed Sec. Sec.  121.5(d),
121.6(a).
    As discussed above, if the agencies do not agree on the length of a
reasonable period of time within 30 days of receipt of a request for
certification, the default reasonable period of time would apply. See
proposed Sec.  121.6(c) This default approach obviates the need for a
dispute resolution process in the event the certifying authority and
Federal agency are not able to agree on the reasonable period of time.
    EPA believes that a default reasonable period of time of 60 days is
a sensible and practical interpretation of the reasonable period of
time concept. First, the approach is responsive to stakeholder concerns
regarding the 2020 Rule's approach. In pre-proposal outreach, several
stakeholders indicated that most delays in the certification process
were attributed to lack of information. As discussed in section V.C in
this preamble, EPA is proposing that all requests for certification
must include a copy of the draft license or permit and any existing and
readily available data or information related to potential water
quality impacts from the proposed project and provides certifying
authorities with the opportunity to define what additional information
is needed in a certification request. These components of the proposal
would allow certifying authorities to define what information is
necessary to initiate a successful certification review process and,
thus, address lack of information concerns before the reasonable period
of time begins.
    It bears noting that the statutory language does not guarantee that
the reasonable period of time is one year in all instances. Rather,
section 401(a)(1) provides that the reasonable period of time ``shall
not exceed one year.'' 33 U.S.C. 1341(a)(1). The words ``shall not
exceed'' imply that the reasonable period of time need not be one full
year and that a certifying authority should not--in all circumstances--
expect to be able to take a full year to act on a section 401
certification request. Under the proposal, the certifying authority
could be subject to a shorter than one-year period of time to render
its decision, provided that the Federal agency and the certifying
authority have agreed to a shorter time, or as discussed above, the
agencies rely on the default reasonable period of time. See Hoopa
Valley Tribe v. FERC, 913 F.3d 1099, 1104 (D.C. Cir. 2019) (``[W]hile a
full year is the absolute maximum, it does not preclude a finding of
waiver prior to the passage of a full year.''). Additionally, the
Agency's longstanding 1971 regulations acknowledged that the reasonable
period of time may be less than one year. See 40 CFR 121.16(b) (2019)
(noting that the reasonable period of time is generally six months).
    Based on the Agency's nearly 40 years of experience with NPDES
permits, the Agency views a 60-day default reasonable period of time as
appropriate, provided (as the proposed rule would require) that the
reasonable period of time does not commence until after the Federal
licensing or permitting agency prepares a draft license or permit. See
40 CFR 124.53(c)(3) (providing a default 60-day reasonable period of
time for certification on draft NPDES permits). In the NPDES permitting
process, draft permits include detailed fact sheets or statements of
how permit limits and conditions were developed along with legal and/or
scientific justifications, giving certifying authorities relevant data
and information to use in their certification process and decision. A
default 60-day reasonable period of time is also used for certification
requests on section 404 general permits, which occurs after the Corps
prepares the draft permit. See 33 CFR 325.2(b)(1)(ii).
    EPA requests comment on this proposed collaborative approach to
setting the reasonable period of time, the 30-day timeframe that the
Federal agency and certifying authority would have to determine the
length of the reasonable period of time, and the 60-day default. The
Agency also requests comments on alternative approaches, such as
retaining the approach where the Federal agency is solely responsible
for determining the reasonable period of time. Another alternative
approach EPA seeks comment on is whether the default reasonable period
of time should be shorter or longer depending on when certification is
requested during the

licensing or permitting process. For example, if EPA were to decide
that a draft license or permit is not a required component of a
certification request, should EPA's regulations specify a different and
potentially longer default reasonable period of time? Additionally, the
Agency is soliciting comment on whether and why the default reasonable
period of time should be longer than 60 days (e.g., 120 days, six
months, one year). The Agency also requests any information, data, or
experiences stakeholders can provide on the length of time it has taken
or should take a certifying authority to act on a request for
certification.
2. Extensions to the Reasonable Period of Time
    The proposed rule provides that the reasonable period of time may
be extended upon written agreement by the certifying authority and
Federal agency, in consultation with the project proponent. Any
extensions shall not exceed one year from the receipt of the
certification request. Project proponents would be consulted before any
changes to the reasonable period of time, but they would not have the
ability to veto final reasonable period of time decisions jointly made
by the certifying authority and Federal agency. The statute does not
explicitly address extending the reasonable period of time once it has
started; nor does it expressly prohibit extending the reasonable period
of time as long as the certifying authority ``acts'' within one year
from receipt of the certification request. The statute also does not
specify who may extend the reasonable period of time or the terms on
which it may be extended.
    The 1971 Rule was also silent on reasonable period of time
extensions. However, several Federal agencies, including EPA and the
Corps, established regulations allowing extensions to their default
reasonable periods of time. See 40 CFR 124.53(c) (allowing for a
reasonable period of time greater than 60 days for certification
requests on NPDES permits where the EPA Regional Administrator finds
``unusual circumstances''); 33 CFR 325.2(b)(1)(ii) (allowing for a
reasonable period of time greater than 60 days for certification
requests on Corps permits when the ``district engineer determines a
shorter or longer period is reasonable for the state to act.'').
    The 2020 Rule explicitly allows certifying authorities to request
an extension of the reasonable period of time. 40 CFR 121.6(d).
However, only the Federal agency has the power to extend the reasonable
period of time, and such extension cannot exceed one year from the
receipt of the certification request. Id.; see also 85 FR 42260 (July
13, 2020). Under the 2020 Rule, the Federal agency is not required to
grant reasonable period of time extension requests. See 40 CFR
121.6(d)(2). As a result, Federal agencies may deny those requests even
in situations where the certifying authority said it was not able to
act within the established timeframe (e.g., where state public notice
procedures required more time than the regulatory reasonable period of
time). In pre-proposal input, at least one stakeholder observed that a
Federal agency's failure to grant an extension request could lead to
certification denials. Other stakeholders noted that certifying
authorities should have a say in any extensions of the reasonable
period of time.
    The proposed requirement to include a copy of the draft license or
permit (and any existing and readily available data or information
related to potential water quality impacts from the proposed project)
in the request for certification, and the opportunity to
collaboratively set the reasonable period of time, should reduce the
need for extensions. However, the Agency recognizes there may be
circumstances where the established or default reasonable period of
time are not sufficient to allow the certifying authority to complete
its review. Accordingly, the Agency is proposing to allow certifying
authorities and Federal agencies to jointly extend the reasonable
period of time in a written agreement, as long as the project proponent
is consulted and the extension does not exceed one year from the
receipt of request for certification. See proposed Sec.  121.6(d).
Consistent with this proposed collaborative approach, the Agency is not
proposing to retain the regulatory text located at Sec.  121.6(d) that
permits Federal agencies to unilaterally determine whether to extend
the reasonable period of time. This proposal does not preclude a
Federal licensing or permitting agency from extending the reasonable
period of time after a certification has been issued, as long as the
extension will not exceed one year from receipt of the request for
certification.\39\
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    \39\ For example, a certifying authority may submit a new or
revised certification decision after it acts on a certification
request if the reasonable period of time has not expired and the
Federal licensing or permitting agency agrees. See U.S. EPA and
Department of the Army, Clean Water Act Section 401 Certification
Implementation Memorandum (August 19, 2021). In contrast to the
certification modification proposed at Sec.  121.10, a new
certification decision made within the reasonable period of time
will supersede the previous certification decision.
---------------------------------------------------------------------------

    The Agency expects that certifying authorities and Federal agencies
will collaboratively agree to extensions to the reasonable period of
time where needed. For example, the certifying authority and Federal
agency could develop in a MOA a process to identify scenarios where
changes to the reasonable period of time would be appropriate. Such
scenarios may include situations where relevant new information becomes
available during the reasonable period of time. EPA notes that the
proposed rulemaking promotes early collaboration and pre-filing
meetings to allow the Federal agency, certifying authority, and the
project proponent to discuss project complexity, seasonal limitations,
and other factors that may influence the time needed to complete the
certification review. These opportunities may reduce the need to extend
the jointly established or default reasonable period of time.
    However, the Agency also recognizes that there are circumstances
under which the Federal agency should extend the reasonable period of
time without the certifying authority needing to negotiate an
agreement. Such situations, which were not included in the 2020 Rule,
include where a certification decision cannot be rendered within the
reasonable period of time due to force majeure events (including, but
not limited to, government closure or natural disasters). Extensions
may also be necessary in jurisdictions where the state or tribal public
notice and comment process takes longer than the negotiated or default
reasonable period of time. To address pre-proposal input, in contrast
to the 2020 Rule, the Agency is proposing to identify a limited list of
scenarios that would require the extension of the reasonable period of
time. See proposed Sec.  121.6(c). If a longer period of time to review
the request for certification is necessary due to these circumstances,
upon notification by the certifying authority prior to the end of the
reasonable period of time, the reasonable period of time shall be
extended by the period of time necessitated by public notice
requirements or the force majeure event. In its notification, the
certifying authority must provide the Federal agency with a written
justification for an extension. Ultimately, such extension may not
exceed one year from receipt of the request for certification. The
justification would describe the circumstances supporting the extension
(i.e., accommodating the certifying authority's public notice
requirements, government closures, or natural

disasters) and does not require Federal agency approval before taking
effect. For example, if the reasonable period of time is set to the
default 60 days and the certifying authority has a 90-day public notice
requirement, then the certifying authority would provide a written
justification to the Federal agency prior to the end of the reasonable
period of time for an extension to accommodate the public notice
requirement. The extended reasonable period of time would take effect
upon notification by the certifying authority to the Federal agency.
    The proposed approach balances Federal agency and certifying
authority equities better than the 1971 Rule and the 2020 Rule by
allowing the Federal agency and certifying authority to determine
collaboratively whether and how the reasonable period of time should be
extended. This approach to extensions aligns with the approach proposed
above for joint establishment of the reasonable period of time. It also
aligns with cooperative federalism principles central to the CWA.
Moreover, it encourages stakeholder cooperation and allows for input
from the project proponent. EPA is soliciting comment on this proposed
approach. The Agency is also seeking comment on the list of situations
described in the regulatory text under which extensions would be
automatic, for example, whether other circumstances should be expressly
included. Additionally, the Agency seeks comment on any alternative
approaches, such as only allowing the Federal licensing or permitting
agency to determine any extensions of the reasonable period of time,
not requiring the project proponent to be consulted before an extension
decision, or not allowing any extensions of the reasonable period of
time after the agreed to or default reasonable period of time has been
established.
    Consistent with this proposal, the Agency is also proposing to
delete the part 124 provisions regarding the reasonable period of time
for certification on EPA-issued NPDES permits, currently located at 40
CFR 124.53(c)(3), in favor of the reasonable period of time provisions
in proposed Sec.  121.6. The approach to the reasonable period of time
taken in Sec.  124.53(c) is not fully consistent with the approach
proposed at Sec.  121.6. For instance, unlike proposed Sec.  121.6(b),
Sec.  124.53(c)(3) does not involve certifying authority collaboration
in setting the reasonable period of time. And unlike proposed Sec.
121.6(c), Sec.  124.53(c)(3) does not allow for automatic extensions to
accommodate a certifying authority's public notice requirements or
force majeure events (instead allowing extensions beyond the default 60
days only if EPA finds ``unusual circumstances'' require a longer
time).
3. Withdrawal and Resubmissions of Requests for Certification
    EPA is aware that, historically under the 1971 Rule, certifying
authorities asked project proponents to withdraw and resubmit their
certification requests in order to restart the clock and provide more
time to complete their certification review. EPA is also aware that
this practice has been subject to Federal court litigation. In this
proposed rule, EPA is not taking a position on the legality of
withdrawing and resubmitting a certification request. While there may
be situations where withdrawing and resubmitting a certification
request is appropriate, drawing a bright regulatory line on this issue
is challenging, and the law in this area is dynamic. See Hoopa Valley
Tribe v. FERC, 913 F.3d 1099, 1105 (D.C. Cir. 2019) (holding that a
repeated, coordinated withdrawal and resubmittal of a certification
request resulted in a waiver); N.C. Dep't of Envtl. Quality (NCDEQ) v.
FERC, 3 F.4th 655, 676 (4th Cir. 2021) (finding that the record did not
support FERC's determination that the state and project proponent
withdrew and resubmitted the certification request in a coordinated
fashion). For these reasons, the proposed rulemaking does not take a
position on this issue, instead allowing the courts and the different
state and tribal certifying authorities to make case-specific decisions
or issue their own regulations addressing the practice.
    Neither section 401 nor the 1971 Rule specifically address the
practice of withdrawing a certification request and submitting a new
request to restart the reasonable period of time. On the other hand,
the 2020 Rule prohibits the certifying authority from asking the
project proponent to withdraw the certification request to reset the
reasonable period of time. 40 CFR 121.6(e). In support of that
position, the 2020 Rule relies on a broad reading of the D.C. Circuit's
decision in Hoopa Valley Tribe and asserts that the regulatory text at
Sec.  121.6(e) is a ``clear statement that reflects the plain language
of section 401 and . . . is supported by the legislative history.'' 85
FR 42261. In that case, which featured highly unusual facts,\40\ the
court rejected the particular ``withdraw and resubmit'' \41\ strategy
the project proponents and states had used to avoid waiver of
certification for a FERC license. 913 F.3d at 1105. The court held that
a decade-long ``scheme'' to subvert the one-year review period
characterized by a formal agreement between the certifying authority
and the project proponent, whereby the project proponent never even
submitted a new request, was inconsistent with the statute's one-year
deadline. Id. Significantly, the court said it was not addressing the
legitimacy of a project proponent actually withdrawing its request and
then submitting a new one, or how different a new request had to be to
restart the one-year clock. Id. at 1104.
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    \40\ The court held that the project proponent and the
certifying authorities (California and Oregon) had improperly
entered into an agreement whereby the ``very same'' request for
state certification of its relicensing application was automatically
withdrawn and resubmitted every year for a decade by operation of
``the same one-page letter,'' submitted to the states before the
statute's one-year waiver deadline. 913 F.3d at 1104.
    \41\ Historically, certifying authorities and project proponents
have used the ``withdraw and resubmit'' approach for dealing with
the one-year deadline for complex projects. There are a multitude of
permutations, but the basic idea is that the project proponent would
withdraw the certification request and then resubmit a new
certification request either immediately or at some later date. The
Agency recognizes that there may be legitimate reasons for
withdrawing and resubmitting certification requests, including but
not limited to the following: a new project proponent, project
analyses are delayed, or the project becomes temporarily infeasible
due to financing or market conditions.
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    On the other hand, at least two circuit courts have acknowledged
the possibility that withdrawal and resubmittal of a certification
request may be a viable mechanism for addressing complex certification
situations. See NCDEQ, 3 F.4th at 676 (withdrawal and resubmittal
appropriate where the certifying authority and project proponent did
not engage in a coordinated scheme to evade the reasonable period of
time); NYSDEC, 884 F. 3d at 456 (noting in dicta that the state could
``request that the applicant withdraw and resubmit the application'').
Additionally, EPA's guidance prior to the 2020 Rule acknowledged use of
the withdrawal and resubmittal approach, as well as the ``deny
certification without prejudice to refile'' approach but noted that
``[t]his handbook does not endorse either of the two approaches . . .
.'' 2010 Handbook, at 13, n.7 (rescinded).
    During pre-proposal input, many state and tribal stakeholders said
they did not support the 2020 Rule's position on the withdrawal and
resubmittal process. These stakeholders called for more flexibility in
the case of unexpected and significant changes in the project. For the
reasons discussed below, EPA is not

proposing to retain the regulatory text at Sec.  121.6(e) and instead,
proposing not to take a position in this rulemaking on the
permissibility of withdrawing and resubmitting a certification request.
    As mentioned above, neither the text of section 401 nor Hoopa
Valley Tribe categorically precludes withdrawal and resubmission of a
certification. EPA understands the concern expressed by the D.C.
Circuit in Hoopa Valley Tribe that prolonged withdrawal and
resubmission ``schemes'' might--under certain facts--unreasonably delay
and frustrate the Federal licensing and permitting process. Yet, the
potential factual situations that might give rise to, and potentially
justify, withdrawal and resubmission of a certification request are so
varied that the Agency is not confident that it can create regulatory
``bright lines'' that adequately and fairly address each situation. By
not taking a regulatory position on this issue, certifying authorities
are free to determine on a case-by-case basis whether and when
withdrawal and resubmittal of a certification request is appropriate.
Such determinations are ultimately subject to judicial review based on
their individual facts. The Agency seeks comment on this approach, as
well as any alternative approaches, such as EPA establishing
regulations specifically authorizing withdrawals and resubmissions in
certain factual situations similar (or not) to the circumstances in
Hoopa Valley Tribe.

D. Scope of Certification

    The Agency is proposing to return to the scope of certification
standard affirmed by the Supreme Court in PUD No. 1 of Jefferson County
v. Washington Dep't of Ecology, 511 U.S. 700 (1994). In that case, the
Court held that section 401 ``is most reasonably read'' as authorizing
the certifying authority to evaluate and place conditions on what the
Court described as the ``project in general'' or the ``activity as a
whole'' to assure compliance with various provisions of the Clean Water
Act and ``any other appropriate requirement of State law'' once the
predicate existence of a discharge is satisfied. Id. at 711-12. The
2020 Rule substantially narrowed the scope of a certifying authority's
review of a federally licensed or permitted project. Before the 2020
Rule, a certifying authority could consider whether the federally
licensed or permitted ``activity as a whole'' might adversely affect
the quality of the state's or tribe's waters. After the 2020 Rule
became effective, the certifying authority could only consider
potential water quality impacts from the project's point source
``discharges.'' See 85 FR 42229 (July 13, 2020). This change was
heavily criticized by many states, tribes, and non-governmental
organizations as unlawfully narrowing the certifying authorities' scope
of review under section 401. In recognition of, and deference to, the
central role that states and tribes play in issuing CWA section 401
certifications, EPA is proposing to modify the regulatory text at Sec.
121.3 and reaffirm the broader and more environmentally protective
``activity as a whole'' scope of review that the Supreme Court affirmed
in PUD No. 1.
    The distinction and choice between ``discharge-only'' and
``activity as a whole'' is more than semantic and has significant
environmental consequences. The ``activity as a whole'' approach allows
states and tribes to holistically consider and protect against impacts
to their water resources from the licensed or permitted ``project in
general.'' Id. at 711. For example, stakeholders have commented that a
``discharge-only'' approach would inappropriately constrain the scope
of review and conditions relating to hydroelectric dam facilities.
Specifically, stakeholders stated that addressing the water quality
impacts of a dam requires a broader review of potential effects beyond
those caused only by the discharge(s) from a dam's powerhouse or
tailrace. This is because the chemical, physical, and biological
integrity of a river is fundamentally altered by the federally licensed
``activity'' or ``project''--not just the discharges from a specific
element, e.g., the powerhouse or tailrace. They noted that a dam alters
the chemical, physical, and biological integrity of a river by placing
a barrier across it, blocking upstream and downstream passage of
nutrients and aquatic species, altering the timing and volume of flows,
transforming a free-flowing riverine reach into a reservoir, and
converting the energy that oxygenates water into electricity.
    Stakeholders have asserted that a ``discharge-only'' approach to a
hydroelectric dam facility precludes several kinds of potential non-
discharge-related conditions a certifying authority might add to its
water quality certification, including fish and eel passage facilities
(upstream and downstream), fish protection measures concerning intakes,
wildlife habitat enhancements, and aquatic resource enhancements.
Stakeholders also noted that FERC-licensed hydropower projects can also
limit public access to a river, adversely affecting fishing, swimming,
boating, and other state-adopted and EPA-approved recreational
designated uses. Conditions assuring protection of those designated
uses would arguably not be allowed if the scope of review is limited
only to impacts from the dam's ``discharges.''
    EPA is concerned that many (if not all) of these water quality-
related impacts and potential conditions might fall outside the scope
of certifying authority review under the 2020 Rule's ``discharge-only''
approach to scope of review. The inability of states and tribes to
protect against such impacts could seriously impair their ability to
protect valuable water resources. This would be inconsistent with
Congress's intention to provide states and tribes with this powerful
certification tool to prevent their water resources from being
adversely impacted by projects needing Federal licenses or permits.
    In addition to narrowing the scope of review from ``activity as a
whole'' to ``discharge,'' the 2020 Rule also significantly narrows the
ability of certifying authorities, pursuant to section 401(d), to
include conditions in their certifications to protect the quality of
their waters. Before the 2020 Rule, consistent with EPA's proposed
interpretation of the statute, a certifying authority could add
conditions to its certification as necessary to assure compliance with
the specifically enumerated sections of the CWA and ``any other
appropriate requirement of State [or Tribal] law.'' 33 U.S.C. 1341(d).
In the 2020 Rule, however, EPA codified a narrow regulatory
interpretation of the section 401(d) term ``other appropriate
requirements of State law.'' 85 FR 42250 (July 13, 2020). With the 2020
Rule in effect, the certifying authority can only add conditions
necessary to assure compliance with those specifically enumerated
sections of the CWA ``and state or tribal regulatory requirements for
point source discharges into waters of the United States.'' 40 CFR
121.1(n), 121.3. In recognition of, and deference to, the central role
that states and tribes play in issuing CWA section 401 certifications,
EPA is proposing to return to what it now views as the more textually
accurate and environmentally protective ``any other appropriate
requirement of State [or Tribal] law'' standard for including
certification conditions.
    As discussed below, the interpretations of section 401's scope of
review and conditions EPA is proposing are more closely aligned with
the statutory text and goals of section 401 than the interpretations in
the 2020 Rule. Consistent with the principles of cooperative federalism
that underlie the Clean Water Act and especially section 401, the
interpretations the Agency is

proposing would restore the full measure of authority that EPA believes
Congress intended to grant states and authorized tribes to protect
their critical water resources.
    The following sections discuss (1) EPA's longstanding position that
CWA section 401 certifications are limited to addressing water quality
effects; (2) EPA's decision to reaffirm the Supreme Court's
interpretation of the scope of certification in PUD No. 1 as the
``activity as a whole;'' and (3) EPA's decision to return to a broader
definition of ``water quality requirements'' than that adopted in the
2020 Rule.
1. Water Quality Impacts From Federally Licensed or Permitted Projects
    The Agency continues to interpret section 401 to provide that, when
issuing certifications and conditions, certifying authorities may only
consider and address potential water quality effects. The CWA's
objective is ``to restore and maintain the chemical, physical, and
biological integrity of the Nation's waters.'' 33 U.S.C. 1251(a). Among
the Act's policy declarations is ``the policy of Congress to recognize,
preserve, and protect the primary responsibilities of States to
prevent, reduce, and eliminate pollution.'' Id. at 1251(b). As
discussed in section IV.A in this preamble, Congress intended that
section 401 provide states and tribes with a powerful tool to prevent
their water resources from being adversely impacted by projects needing
Federal licenses or permits. While the text of section 401 does not
expressly state that certifications and conditions may only consider
and address water quality effects, the courts have consistently
clarified that this is so. See Am. Rivers, Inc. v. FERC, 129 F.3d 99,
107 (2d Cir. 1997) (``Section 401(d), reasonably read in light of its
purpose, restricts conditions that states can impose to those affecting
water quality in one manner or another.''); see also PUD No. 1, 511
U.S. at 711-713 (holding that a state's authority to impose conditions
under section 401(d) ``is not unbounded''). This view is also
consistent with prior Agency interpretations articulated in the 2020
Rule and prior Agency guidance. See 85 FR 42250 (``The scope of a Clean
Water Act section 401 certification is limited to assuring that a
discharge from a Federally licensed or permitted activity will comply
with water quality requirements.''); 2010 Handbook, at 16 (rescinded)
(``As incorporated into the 1972 CWA, [section] 401 water quality
certification was intended to ensure that no federal license or permits
would be issued that would prevent states or tribes from achieving
their water quality goals or that would violate CWA provisions.'').
    Accordingly, EPA continues to maintain that it would be
inconsistent with the purpose of CWA section 401 to deny or condition a
section 401 certification based solely on potential air quality,
traffic, noise, or economic impacts that have no connection to water
quality. In pre-proposal outreach, it appeared that some stakeholders
were confused about whether an EPA proposal to align the scope of
review with PUD No.1 would allow certifying authorities to deny or
condition certifications based on potential environmental or societal
impacts not related to water quality. It is not the Agency's intention
to do so or to include consideration of such non-water quality-related
impacts within the proposed ``activity as a whole'' scope of review.
    The preamble to the final 2020 Rule identified examples of
certification conditions possibly falling outside the water quality-
related scope of section 401 review because they did not address water
quality impacts, including one-time and recurring payments to state
agencies for improvements or enhancements that are unrelated to the
proposed federally licensed or permitted project; conditions to address
potential non-water quality-related environmental impacts from the
creation, manufacture, or subsequent use of products generated by a
proposed federally licensed or permitted activity or project; and
conditions related only to non-water quality-related impacts associated
with air emissions and transportation effects. See 85 FR 42230. Subject
to a case-by-case review of the particular facts presented by each
certification, EPA thinks it reasonable to assume that such non-water
quality-related conditions would generally be beyond the scope of
section 401.
    On the other hand, some conditions that stakeholders have
identified as potentially problematic may, in fact, be appropriate as
necessary to prevent adverse impacts to a state's or tribe's water
quality. Depending on the circumstances, examples of conditions that
might be appropriate to include in a state or tribal certification to
comply with water quality requirements could be: building and
maintaining fish passages (related to protecting designated uses); the
construction of public access for fishing (related to protecting
recreational/fish consumption designated uses); maintaining minimum
flow rates for visual, auditory, and religious experiences (related to
protecting designated uses); compensatory wetland and riparian
mitigation (related to protecting designated uses and criteria);
temporal restrictions on activities to protect sensitive aquatic
species (related to protecting designated uses); pre-construction
monitoring and assessment of resources (related to protecting
designated uses and criteria); habitat restoration (related to
protecting designated uses and criteria); construction of recreation
facilities to support designated uses (e.g., whitewater release for
kayakers, canoe portages, parking spaces) (related to protecting
designated uses); tree planting along waterways (related to protecting
designated uses and criteria); and spill management and stormwater
management plans (related to protecting designated uses and criteria).
For these and other potentially qualifying conditions, EPA believes
that it is appropriate for the certifying authority to consider the
broadest possible range of water quality effects and that the
appropriateness of any given condition will depend on an analysis of
all relevant facts.
    The Agency invites comment on to what extent section 401
certification review and conditions should be limited to potential
water quality-related effects or should also consider non-water
quality-related impacts.
2. ``Activity as a Whole''
    EPA is proposing to return to the ``activity as a whole'' or
``project in general'' scope of certification review and conditions
that the Supreme Court affirmed in PUD No. 1. Having carefully reviewed
the 2020 Rule in light of pre-proposal stakeholder comments, EPA has
determined that the ``activity as a whole'' interpretation of scope is
more consistent with the statutory text, legislative history, and water
quality protective goals of the CWA than the 2020 Rule's ``discharge-
only'' approach. The Agency also finds that the more environmentally
protective ``activity as a whole'' interpretation of scope is better
aligned with the cooperative federalism principles animating section
401.
    The first sentence of section 401(a)(1) provides that a
certification must be obtained by ``any applicant for a Federal license
or permit to conduct any activity . . . which may result in any
discharge into the navigable waters.'' 33 U.S.C. 1341(a)(1) (emphasis
added). These three italicized words--``applicant,'' ``activity,'' and
``discharge''--are the semantic building blocks used to support two
differing interpretations of scope of review. Supporters of the

``discharge-only'' interpretation of scope of review chiefly rely on
Congress's use of the word ``discharge'' in section 401(a)(1) in
support of the proposition that states and tribes may only consider
water quality impacts from the project's discharges when deciding
whether to certify or add conditions to federally licensed or permitted
projects. EPA disagrees with this overly narrow interpretation.
Following its reconsideration of the statutory text, the Agency
believes that Congress's use of the words ``applicant'', ``activity'',
and ``discharge'' in section 401(a)(1), ``applicant'' in section
401(d), and its failure to use the word ``discharge'' in section
401(d), create enough ambiguity to support an interpretation that
certifying authority review, and the ability to impose conditions,
extends to the project proponent's ``activity as a whole,'' or in other
words, the ``project in general.'' In the 2020 Rule, EPA acknowledged
that the statutory language addressing scope of review is ambiguous and
subject to interpretation. See 85 FR 42232. In light of that ambiguity,
EPA now agrees with the Supreme Court in PUD No. 1 that ``activity as a
whole'' is ``a reasonable interpretation of [section] 401.'' PUD No. 1,
511 U.S. at 712.\42\
---------------------------------------------------------------------------

    \42\ The dissent in PUD No. 1 offered a more limited
interpretation of section 401(d)'s scope, stating that ``while
[section] 401(d) permits a State to place conditions on a
certification to ensure compliance of the `applicant,' those
conditions must still be related to discharges.'' 511 U.S. at 727
(Thomas, J., dissenting with whom Scalia, J., joined).
---------------------------------------------------------------------------

    In PUD No. 1, the Supreme Court reviewed a water quality
certification issued by the State of Washington for a new hydroelectric
project on the Dosewallips River. The principal dispute adjudicated in
PUD No. 1 was whether a certifying authority may require a minimum
stream flow as a condition in a certification issued under section 401.
The project applicant identified two potential discharges from its
proposed hydroelectric facility: ``the release of dredged and fill
material during construction of the project, and the discharge of water
at the end of the tailrace after the water has been used to generate
electricity.'' Id. at 711. The project applicant argued that the
minimum stream flow condition was unrelated to these discharges and
therefore beyond the scope of the state's authority under section 401.
Id.
    The Court examined sections 401(a)(1) and 401(d), specifically the
use of different terms in those sections of the statute to inform the
scope of a section 401 certification. Section 401(a)(1) requires the
certifying authority to certify that the discharge from a proposed
federally licensed or permitted project will comply with certain
enumerated CWA provisions, and section 401(d) authorizes the certifying
authority to include conditions to assure that the applicant will
comply with those enumerated CWA provisions and ```any other
appropriate' state law requirements.'' Id. at 700. Emphasizing that the
text of section 401(d) ``refers to the compliance of the applicant, not
the discharge,'' the Court concluded that section 401(d) ``is most
reasonably read as authorizing additional conditions and limitations on
the activity as a whole once the threshold condition, the existence of
a discharge, is satisfied.'' Id. at 712.\43\ The Court recognized that
section 401 placed some bounds on the ``activity as a whole'' scope,
noting that a certifying authority ``can only ensure that the project
complies with `any applicable effluent limitations or other limitations
under [33 U.S.C. 1311, 1312] or other provisions of the Act,['] `and
with any other appropriate requirement of State law.''' 511 U.S. at
712. The Court found that ``at a minimum, limitations imposed pursuant
to state water quality standards adopted pursuant to [section] 303,''--
the limitations at issue in PUD No. 1--``are `appropriate' requirements
of state law,'' but declined ``to speculate on what additional state
laws, if any, might be incorporated by this language.'' Id. at 713.
---------------------------------------------------------------------------

    \43\ Without acknowledging that the 1971 Rule was based on an
earlier version of the statute, the Court also noted that its
interpretation was consistent with EPA's 1971 Rule. Id. at 712.
---------------------------------------------------------------------------

    A quarter of a century after PUD No. 1, in its 2020 Rule EPA
rejected its longstanding ``activity as a whole'' interpretation,
affirmed by the PUD No. 1 majority, in favor of the dissent's
``discharge-only'' interpretation of section 401's scope. The 2020
Rule's interpretation received heavy criticism and was subject to
multiple legal challenges. Having now carefully reconsidered the
``discharge-only'' interpretation of scope of review the previous
Administration announced in the 2020 Rule, EPA has concluded that the
statutory text, legislative history, and goals of section 401 more
reasonably support the ``activity as a whole'' standard that was
accepted practice for the preceding 50 years.
    Congress's 1972 textual revisions to section 21(b) support the
``activity as a whole'' interpretation of scope. At the same time it
was revising section 401(a)(1), Congress added section 401(d) that
required states to include conditions ``necessary to assure'' that
``any applicant'' will comply with sections 301, 302, 303, 306 and 307
and ``any other appropriate requirement of State law.'' \44\ Unlike
section 401(a)(1), section 401(d) does not use the term ``discharge.''
Use of the word ``applicant'' instead of ``discharge'' in section
401(d) introduced ambiguity as to whether the scope of section 401
review was limited to effects from the discharge alone. In light of
this ambiguity, EPA believes it is reasonable to interpret the combined
text of sections 401(a)(1) and 401(d) as supporting ``activity as a
whole'' as the proper scope of certification. 511 U.S. at 711-712.
(``[Section] 401(d) is most reasonably read as authorizing additional
conditions and limitations on the activity as a whole once the
existence of the threshold condition, existence of a discharge, is
satisfied.''). Because section 401(d) requires that a section 401(a)
certification include conditions ``necessary to assure'' the
applicant's compliance with the five CWA sections listed in section
401(a)(1) and ``any other appropriate requirement of State law,''
section 401(d) is most reasonably read to require the certifying
authority--when it reviews a certification request under section
401(a)(1)--to review the potential water quality impacts from the
``project in general,'' i.e, the ``activity as a whole,'' and not
merely evaluate the water quality effects of the potential discharge.
This approach is reasonable because it accounts for the fact that the
applicant for certification is responsible for a wide variety of
activities at the project site that might affect water quality in
addition to any potential ``discharge.'' To assure--as it must under
section 401(d)--that ``the applicant'' complies with all applicable
state or tribal and Federal water quality requirements, the certifying
authority must be able to evaluate potential water quality effects from
the applicant's ``activity as a whole.'' \45\
---------------------------------------------------------------------------

    \44\ Public Law 92-500, 401, 85 Stat. 816 (1972).
    \45\ PUD No. 1 also said its ``activity as a whole''
interpretation was consistent with EPA's 1971 Rule at 40 CFR
121.2(a)(3) (2019) (requiring reasonable assurance that the
``activity'' will not violate applicable water quality standards)
and with EPA's 1989 Guidance. It is worth noting, however, that
EPA's 1971 Rule pre-dated the 1972 amendments and was based on the
language of the 1970 version of the statute which used the word
``activity'' instead of ``discharge.'' While the Court appeared to
be unaware of that fact, it is of minor significance because EPA's
conclusion that ``activity as a whole'' is the most reasonable
interpretation is based on the statutory text and legislative
history, not EPA's regulations preceding enactment of the 1972 law.
---------------------------------------------------------------------------

    The text of CWA sections 401(a)(3)-(5) also supports an ``activity
as a whole'' interpretation of section 401's scope. Section 401(a)(3)
provides that a

certification for a facility's construction fulfills the section 401
obligations with respect to its operation unless the certifying
authority determines there is no longer reasonable assurance of
compliance with sections 301, 302, 303, 306 and 307 because of changes
in ``(A) the construction and operation of the facility.'' See 33
U.S.C. 1341(a)(3). ``Construction and operation of the facility'' is
clearly a broader concept than ``discharge.'' In addition, section
401(a)(4) guarantees that the certifying authority has the opportunity
``to review the manner in which the [previously certified] facility or
activity shall be operated or conducted'' prior to its initial
operation ``for the purpose of assuring that applicable effluent
limitations or other limitations or water quality requirements will not
be violated.'' See id. at 1341(a)(4). If this review results in
suspension of the facility's permit, the permit shall remain suspended
until notification from the certifying authority that ``there is
reasonable assurance that such facility or activity will not violate
the applicable provisions of section 1311, 1312, 1313, 1316 and 1317.''
Id. Lastly, section 401(a)(5) provides that any certified Federal
license or permit may be suspended or revoked by the Federal licensing
or permitting agency ``upon the entering of a judgment under this
chapter that such facility or activity has been operated in violation
of the applicable provisions of section 1311, 1312, 1313, 1316 and
1317.'' See id. at 1341(a)(5). The scope of review employed in each of
these subsections is whether there has been compliance by the
``facility or activity'' with the five CWA sections identified in
section 401(a)(1), and not merely compliance by the ``discharge.''
Congress's application of this ``facility'' and ``activity'' scope of
review in sections 401(a)(3)-(5) is consistent with and supports an
``activity as a whole'' interpretation of sections 401(a)(1) and
401(d).
    The legislative history of CWA section 401, and its predecessor
section 21(b) of the Water Quality Improvement Act of 1970, also
supports the ``activity as a whole'' interpretation of scope. EPA
believes that the mere fact that Congress changed a single word
``activity'' to ``discharge'' in section 401(a)(1) of the 1972 Act is
not dispositive, or even persuasive, that Congress intended to shrink
the scope of review under sections 401(a)(1) and (d) from consideration
of water quality effects caused by the ``project in general'' or
``activity as a whole'' to those caused only by the discharge.
    It is not obvious from the legislative history that such a
significant shift was intended. It is, however, quite clear from the
legislative history that, in 1972, Congress thought it was making only
``minor,'' insubstantial changes to section 21(b). The Senate Report
stated that section 401 was ``substantially section 21(b) of the
existing law.'' S. Rep. No. 92-414, at 69 (1971). See also remarks of
Sen. Baker: ``Section 21(b), with minor changes, appears as section 401
of the pending bill S.2770.'' 117 Cong. Rec. 38857 (1971). Nowhere in
the legislative history is there a statement to the effect that
Congress understood it was dramatically shrinking section 401's scope
of review to only those water quality effects caused by a potential
discharge. To the contrary, the House Report stated that ``[i]t should
be clearly noted that the certifications required by section 401 are
for activities which may result in any discharge into navigable
waters.'' H.R. Rep. 92-911, at 124 (1972) (emphasis added). Indeed, in
summarizing section 401, Senator Muskie stated that ``[a]ll we ask is
that activities that threaten to pollute the environment be subjected
to the examination of the environmental improvement agency of the State
for an evaluation and recommendation before the federal license or
permit be granted.'' 117 Cong. Rec. 38854 (1971) (emphasis added). See
also H.R. Rep. 92-911, at 121 (1972) (stating that ``[t]he term
`applicable' as used in section 401 . . . means that the requirement
which the term `applicable' refers to must be pertinent and apply to
the activity and the requirements must be in existence by having been
promulgated or implemented.'') (emphasis added).
    A comparison of section 21(b) and section 401 reveals that the two
sections are, indeed, substantially the same. In light of the
previously discussed legislative history affirming that the 1972 law
was ``substantially'' the same as the 1970 law, EPA does not think it
reasonable to assume that Congress intended to make fundamental changes
to the scope of the certifying authority's certification review merely
by changing a single word (``activity'') in section 401(a) when--at the
same time--it added a different and more expansive formulation based on
the word ``applicant'' in section 401(d). See Whitman v. Am. Trucking
Ass'ns, 531 U.S. 457, 468 (2001) (``Congress, we have held, does not
alter the fundamental details of a regulatory scheme in vague terms or
ancillary provisions--it does not, one might say, hide elephants in
mouseholes.'').
    Congress's revisions to section 401(a) in the 1977 CWA amendments
also suggests it continued to support the application of the broader
``activity'' approach. Legislative history from 1977 states that
Congress intended for ``[t]he inserting of section 303 into the series
of sections listed in section 401 [ ] to mean that a federally licensed
or permitted activity, including discharge permits under section 402,
must be certified to comply with State water quality standards adopted
under section 303.'' H.R. Rep. No. 95-830, at 96 (1977) (emphasis
added).
    The Agency invites comment on its proposal to readopt the
``activity as a whole'' definition of scope of review under section
401(a)(1) and scope of conditions under section 401(d). The Agency is
also seeking comment on whether it should adopt the ``discharge-only''
scope of review announced in the 2020 Rule.
    Consistent with the discussion above, the Agency is proposing to
define the term ``activity as a whole'' to capture ``any aspect of the
project activity with the potential to affect water quality.'' See
proposed Sec.  121.1(a). This approach provides certifying authorities
with the ability to consider any aspect of the federally licensed or
permitted activity that may adversely impact water quality. As the
stakeholder input described above illustrates, the impacts of a
federally licensed or permitted project on a certifying authority's
water resources may be caused by aspects of the project's activity in
addition to the potential discharge that triggered the need to seek
section 401 certification. Accordingly, the Agency's proposed
definition for the term ``activity as a whole'' is meant to include all
activity at the proponent's ``project in general'' with the potential
to affect water quality (e.g., construction and operation of the
project or facility). This definition of ``activity as a whole'' is
consistent with previously issued EPA guidance, which identified the
scope of review as ``all potential water quality impacts of the
project, both direct and indirect, over the life of the project.'' See
1989 Guidance, at 22 (``[I]t is imperative for a State review to
consider all potential water quality impacts of the project, both
direct and indirect, over the life of the project.''); see also 2010
Handbook, at 17 (rescinded) (``Thus, it is important for the [section]
401 certification authority to consider all potential water quality
impacts of the project, both direct and indirect, over the life of the
project.'') (citing PUD No.1, 511 U.S. at 712 (1994)). The Agency
invites comment on its proposed interpretation of the term ``activity
as a whole.''
    The Agency also understands that, while PUD No. 1 used the term
``activity as a whole,'' the Court did not offer a

specific definition of that term, specifically what ``activity'' should
be examined as a whole. Nevertheless, certifying authorities and
Federal agencies have gained significant experience over nearly 50
years implementing an ``activity as a whole'' approach, and EPA
believes that certifying authorities and Federal agencies are capable
of appropriately delineating the ``activity as a whole'' or the
``project in general'' based on the facts of each situation. EPA is not
aware of any cases in which delineation of ``activity as a whole'' has
been litigated, provided that the scope of review was limited to water
quality. While EPA intends the word ``activity'' in the term ``activity
as a whole'' to include all activities of the ``project in general''
that might affect water quality, EPA invites comment on whether EPA
should specifically define the term ``activity'' to mean only those
activities at the project site that are specifically authorized by the
Federal license or permit in question. EPA also invites comment on
whether and how the Federal licensing or permitting agency could
effectively implement a certification with conditions addressed to
impacts from the ``activity as a whole'' if it has authority over only
a small part of a larger project. What challenges would be presented to
the licensing or permitting authority's ability to administer and
enforce its license or permit?
    To illustrate, assume there are two hydroelectric facilities on the
same river. Facility A has yet to be constructed and may require
multiple Federal licenses or permits. It may require a FERC license for
its construction and operation, a CWA section 404 permit for dredge and
fill activity related to its construction, and a CWA section 402 permit
to discharge pollutants during its operation. Facility B, on the other
hand, has already been constructed and only needs a CWA section 402
permit to discharge pollutants before it may commence operations. EPA
invites comment on whether the same ``activity'' viewed ``as a whole''
should define the scope of review applicable to certifications for both
facilities.
    With respect to the broad, relatively comprehensive licenses and
permits issued by FERC and the Corps for construction and operation of
Facility A, the Agency sees little difference in the scope of review
and conditions that may be included in certifications issued under
either a broad or potentially narrower approach to defining the
relevant ``activity.'' That is because their licenses and permits are
generally comprehensive enough in what they authorize that there would
appear to be few if any significant aspects of a project's activity
that fall outside the scope of activities authorized by the Federal
license or permit. Accordingly, for these kinds of licenses and
permits, EPA believes that any significant potential water quality-
related impacts could be addressed by a certification condition on the
``activity'' whether it is construed to be the activities comprising
the ``project in general'' or ``the specific activity authorized by the
federal license or permit.''
    EPA requests comment on whether a different outcome might apply to
Facility B. As discussed above, Facility B only needs an NPDES permit
to discharge pollutants to commence operations. For purposes of this
example, assume EPA will be issuing the NPDES permit because the
jurisdiction in which the facility is sited does not have NPDES permit
authority. In the case of Facility B, should the scope of the
certifying authority's section 401 review for the Federal NPDES permit
include the potential for water quality-related impacts from Facility
B's ``activity'' broadly defined to include water quality-related
impacts from Facility B's entire construction and operation, including
aspects previously authorized by a FERC license or CWA 404 permit? Or
should the scope of the certifying authority's section 401 review for
Facility B's Federal NPDES permit include only those potential impacts
caused by Facility B's activity narrowly defined as specifically
authorized by the NPDES permit, i.e., the discharge of pollutants like
heated water, oil, and grease introduced by the operation of Facility
B's turbines, and not include other aspects of Facility B's
construction and operation?
    As discussed above, the choice of the narrower approach to defining
``activity'' within the context of ``activity as a whole'' may limit
the kinds of conditions that may be placed on a project proponent's
``activity'' given that the scope of authorization under a more
circumscribed permit, e.g., the NPDES permit for Facility B, would
extend to a narrower range of the project proponent's activities, e.g.,
only the discharge of pollutants and not the other aspects of the dam's
operation not regulated under section 402.
3. Water Quality Requirements
    Under this proposal, when a certifying authority reviews a
federally licensed or permitted activity, it must determine whether the
``activity as a whole'' will comply with ``water quality
requirements.'' Logically, the ``activity as a whole'' standard would
apply to a certifying authority's evaluation of potential water quality
effects under both sections 401(a)(1) and 401(d). This is because the
two sections are inextricably linked. Section 401(d) requires a
certifying authority to determine whether ``the applicant'' will--
without additional conditions--comply with the specified CWA provisions
and ``any other appropriate'' requirement of state law. Only if the
certifying authority determines pursuant to section 401(d) that adding
``any effluent limitations and other limitations, and monitoring
requirements'' to the license or permit will assure that water quality
requirements will be met, may the certifying authority grant the
certification contemplated by section 401(a)(1). The certifying
authority's evaluations and determinations under sections 401(a)(1) and
401(d) do not work together in a harmonious fashion if the statute is
interpreted to apply a different scope of review standard to each
section.
    Because EPA interprets the scope of certification review under
sections 401(a)(1) and (d) to be the same, the same ``activity as a
whole'' standard applies to a grant of certification, a grant of
certification with conditions, and a denial. For example, when a
certifying authority determines that it must add conditions under
section 401(d) to justify a grant of certification under section
401(a), that is equivalent to deciding that, without those conditions,
it must deny certification. The standard for each of the potential
certification decisions is therefore essentially the same.
    To clarify which provisions of Federal and state law a certifying
authority may consider when evaluating and ultimately deciding which
action to take on a certification request pursuant to sections 401(a)
and (d), the Agency is proposing to define the term ``water quality
requirements.'' See proposed Sec.  121.1(m). The term ``water quality
requirements'' is used throughout section 401, and the term ``any other
appropriate requirement of State law'' is used in section 401(d), but
neither term is defined in the CWA. The Agency did not interpret the
term ``water quality requirements'' in the 1971 Rule, perhaps because
the term ``water quality requirements'' was not introduced into section
401 until the 1972 CWA amendments, where it replaced the term ``water
quality standards'' throughout the section. See Public Law 91-224,
21(b)(1), 85 Stat. 91 (1970); Public Law 92-500, 401, 85 Stat. 816
(1972). Accordingly, the 1971 Rule used the

term ``water quality standards'' consistent with the text of the 1970
statutory version of the certification provision. Similarly, the 1971
Rule did not account for the term ``other appropriate requirement of
State law'' since section 401(d) was not introduced until 1972.
    The 2020 Rule defines the term ``water quality requirements,'' and
subsumes the phrase ``any other appropriate requirement of State law''
into the term ``water quality requirements.'' 40 CFR 121.1(n); see 85
FR 42253. Consistent with what EPA characterized as the discharge-only
scope of section 401, the preamble to the final 2020 Rule limited
``water quality requirements'' to only the enumerated provisions of the
CWA listed in section 401(a)(1) and ``state or tribal regulatory
requirements for point source discharges into waters of the United
States.'' 40 CFR 121.1(n). Citing Justice Thomas's dissent in PUD No.
1, the Agency relied on the principle ejusdem generis to argue that the
term ``appropriate requirement of State law'' was limited ``only to
provisions that, like other provisions in the statutory list, impose
discharge-related restrictions.'' 511 U.S. at 728 (Thomas, J.,
dissenting); 85 FR 42453. As a result, the 2020 Rule significantly
narrows the scope of review and ability of certifying authorities to
include conditions to protect their water quality.
    In proposing the definition of the term ``water quality
requirements'' set out in this document, the Agency has reconsidered
the 2020 Rule's definition of the term and finds it appropriate to
interpret the term in a way that respects what EPA believes is the full
breadth of the Federal and state water quality-related provisions that
Congress intended a certifying authority to rely upon when developing
its certification and conditions. Accordingly, EPA is now proposing to
define ``water quality requirements'' to include any limitation,
standard, or other requirement under the provisions enumerated in
section 401(a)(1), any Federal and state laws or regulations
implementing the enumerated provisions, and any other water-quality
related requirement of state or tribal law regardless of whether they
apply to point or nonpoint source discharges.
    The text, purpose, and legislative history of the statute support
the proposed interpretation of ``water quality requirements.'' In
section 401(d) Congress said that certifying authorities must include
conditions in their certifications to assure that any applicant will
comply with enumerated provisions of the CWA and ``any other
appropriate requirement of State law.'' 33 U.S.C. 1341(d) (emphasis
added). The word ``any'' is capacious in its scope, literally meaning
``all'' such state law requirements and not just a limited subset,
e.g., point source-related requirements. While the word ``appropriate''
arguably provides a limiting principle with respect to which
requirements may be considered and applied, the word ``appropriate'' is
to be interpreted broadly in light of statute's text and purpose.
Michigan v. EPA, 576 U.S. 743, 752 (2015) (stating that ``appropriate''
is a broad and all-encompassing term that naturally and traditionally
includes consideration of all the relevant factors). In this context,
the word ``appropriate'' is more reasonably understood as specifying
the ``water quality-related'' nature of such requirements and not their
``point source'' character. This interpretation is consistent with the
water quality protection goals of the CWA, as well as the Supreme
Court's affirmance of EPA's longstanding interpretation in PUD No. 1
that water quality certifications and their conditions must assure that
the ``activity as a whole''--and not just its point source discharges--
does not adversely impact the quality of a certifying authority's
waters.
    Application of the maxim ejusdem generis to limit ``appropriate
requirement of State law'' only to those state law provisions that
impose discharge-related restrictions is misplaced. The list of CWA
provisions referenced in section 401(a)(1), and in section 401(d) by
incorporation, includes section 303, which addresses the requirement to
adopt water quality standards for a state's waters. This requirement
applies to such waters irrespective of the presence of point or
nonpoint sources of pollution or pollutants. Moreover, as discussed
earlier, even though Congress modified the language of section 21(b) to
conform to the revised regulatory approach of the 1972 Act, it is clear
from the legislative history that Congress intended new section 401 to
be substantially the same as section 21(b) and not at all clear that
Congress intended the restrictive reading of ``appropriate requirement
of State law'' arguably suggested by use of that maxim.
    Congress provided states with the primary role in protecting the
Nation's waters from pollution, including pollution from Federal
projects, and the phrase ``water quality requirements'' should be
interpreted broadly to preserve state authority and further the
section's protective goal. See S.D. Warren, 547 U.S. at 386 (``State
certifications under [section] 401 are essential in the scheme to
preserve state authority to address the broad range of pollution . . .
.'').
    The legislative history supports this interpretation. In earlier
versions of section 401(d), Congress proposed to limit section 401(d)
to the enumerated provisions from section 401(a)(1) and either ``any
more stringent water quality requirements under State law provided in
section 510 of [the Act],'' S. 2770, 92nd Cong. (1972), or ``any
regulation under section 316 of this Act.'' H.R. 11896, 92nd Cong.
(1972). Ultimately, neither of those formulations was adopted. Instead,
consistent with Congress's objective to empower states to protect their
waters from pollution, Congress ``expanded'' the scope of section
401(d) ``to also require compliance with any other appropriate
requirement of State law which is set forth in the certification.'' S.
Rep. No. 92-1236, at 138 (1972) (Conf. Rep.).
    EPA recognizes that, as noted by the Court in PUD No. 1, the
authority granted to certifying authorities in section 401(d) ``is not
unbounded.'' 511 U.S. at 712. Rather, the scope is limited to
``ensur[ing] that the project complies with `any applicable effluent
limitations or other limitations under [33 U.S.C. 1311, 1312] or other
provisions of the Act,['] `and with any other appropriate requirement
of State law.''' Id. Although the Court declined ``to speculate on what
additional state laws, if any, might be incorporated by this
language,'' the Court found that ``at a minimum, limitations imposed
pursuant to state water quality standards adopted pursuant to [section]
303 are `appropriate' requirements of state law.'' Id. at 713. As
discussed earlier in this section, EPA's longstanding position is that
the scope of certification decisions and conditions are limited to
water quality-related considerations. See also American Rivers, 129
F.3d at 107 (``Section 401(d), reasonably read in light of its purpose,
restricts conditions that states can impose to those affecting water
quality in one manner or another.''). EPA's redefinition of the term
``water quality requirements'' is not intended to alter this
interpretation.
    The Agency does not, however, view the Act's focus on water
quality-related considerations to mean that certifications and
conditions may only be based on point source discharge provisions in
either Federal or state law. As noted above, the legislative history on
section 401 reveals that, although Congress contemplated a narrower
interpretation of section 401(d) (e.g., limited to the enumerated
provisions and CWA section 316 in the House

version), Congress ultimately codified an ``expanded'' scope of section
401(d).
    In addition, EPA does not believe that the scope of a state's or
tribe's certification review is limited only to water quality effects
in bodies of water meeting the definition of ``navigable waters'' or
``waters of the United States,'' or to water quality effects caused by
point sources. There is nothing in the text of section 401 that compels
either interpretation. Nor, as we said in the preamble to the 2020
Rule, is EPA aware of any court decisions that have directly addressed
the scope of waters covered by section 401. EPA acknowledges it
articulated a different position on those issues in the 2020 Rule. 85
FR 42234-35 (July 13, 2020). However, upon reconsideration, EPA
believes there are good reasons for changing its position now.
    While the text of section 401(a)(1) says that the need for a
certification is only triggered by a potential discharge into ``the
navigable waters,'' it does not state that, once the need for
certification is triggered, a certifying authority must confine its
review to potential water quality impacts to such ``navigable waters.''
Indeed, while section 401(a)(1) says that the certifying authority must
certify that ``any such discharge'' will comply with various provisions
of the CWA, it does not limit the point of compliance for purposes of
certifying authority review to the specific outfall point or to the
waterbody (``navigable'' or not) into which the triggering discharge
occurs. Unlike section 401(a)(1), which uses the term ``discharge''
four times and ``navigable waters'' twice, section 401(d) uses neither
term. Instead, the focus of section 401(d) falls on the conduct of, and
need to assure compliance by, ``the applicant'' and its licensed or
permitted activities, rather than--as with section 401(a)(1)--on the
nature and compliance of the ``discharge'' to ``navigable waters.''
Section 401(d) is thus arguably more expansive than section 401(a)(1),
providing that the certification authority must assure that ``any
applicant'' comply with the same provisions of the CWA, as well as
``any other appropriate requirement of State law,'' and states may,
under state law, protect state waters beyond those that are navigable.
Again, there is no indication in the text or legislative history that
Congress intended the scope of review under sections 401(a)(1) and (d)
to assure such compliance be limited to ``navigable waters.'' Had
Congress desired to create such a limited scope of review, it could
easily have done so. It did not.
    This interpretation is reinforced by the fact that Congress
intended section 401 to afford states broad power to protect their
waters from harm caused by federally licensed or permitted projects.
That intent is best realized by interpreting the scope of section 401
review and conditions as applying to impacts to all potentially
affected state waters, not just the state's ``navigable waters.'' Such
an interpretation is also consistent with PUD No.1's affirmance of
EPA's determination that the proper scope of review is potential water
quality impacts from the ``activity as a whole.'' While the
certification triggering discharge must itself be into a ``navigable
water,'' water quality impacts from the larger ``project in general''
or the ``activity as a whole'' might well occur in state waters at some
distance from the triggering discharge. There is nothing in the phrase
``any other appropriate requirement of State law,'' or the nature of
CWA section 303(c) water quality standards, that would compel an
interpretation that these water quality requirements could only support
certification review or conditions to prevent water quality impacts to
the state's ``navigable waters'' or caused by ``point sources.''
Finally, an expansive interpretation of scope of review as applying to
all potentially affected state waters is supported by CWA section 510,
which--``[e]xcept as expressly provided''--preserves a state's
authority and jurisdiction to protect its waters from pollution.
    In the preamble to the 2020 Rule, EPA acknowledged that CWA
sections 402 and 404 apply only to point source discharges to waters of
the United States. 85 FR 42234. EPA does not disagree with that
proposition here. However, the Agency no longer believes that the point
source focus of sections 402 and 404, or the fact that section 401 is
located in the first section of Title IV of the CWA, titled Permits and
Licenses, means that--once the need for a certification has been
triggered by a point source discharge into a water of the United
States--a state may not consider potential water quality effects in
non-navigable waters caused by the activity as a whole. EPA disagrees
with and finds unpersuasive the 2020 Rule preamble's attempt to
conflate section 401 with sections 402 and 404 by saying that ``similar
to the section 402 and 404 permit programs, section 401 is a core
regulatory provision of the CWA.'' Id. While section 401 is certainly a
critical element of the Act--indeed, it pre-dated the 1972 CWA
amendments and was deemed so important that Congress carried it over--
section 401 is a direct congressional grant of authority for states to
protect their water resources from impacts caused by federally licensed
or permitted projects that is significantly different in character from
the Act's other Federal ``regulatory'' provisions. As such, it is more
reasonable to interpret section 401's scope broadly to effectuate that
grant of authority, consistent with the reservation of state powers in
section 510, rather than interpret section 401's scope as limited to
consideration of point source discharges to or into waters of the
United States like sections 402 and 404.
    In the preamble to the 2020 Rule, the Agency said that ``for many
of the same reasons why the Agency is not interpreting the use of the
word `applicant' in section 401(d) as broadening the scope of
certification beyond the discharge itself, the Agency is also declining
to interpret section 401(d) as broadening the scope of waters and the
types of discharges to which the CWA federal regulatory programs
apply.'' Id. at 42235. As an initial matter, the Agency is not
espousing in this document an interpretation of the scope of section
401 that in any way broadens the scope of basic Federal regulatory
provisions like sections 402 and 404. Instead, the Agency is merely
recognizing the fundamental difference between those Federal
``regulatory'' sections, whose scope is textually limited to point
source discharges to or into waters of the United States, and the grant
of state authority in section 401, which is not so limited. Indeed, to
flip the argument EPA made in 2020, the reasons we have articulated
above in support of broadening the scope of certification beyond the
discharge itself also support expanding its scope beyond a state's
navigable waters. The fact that the Agency continues to agree with the
Ninth Circuit's analysis and holding in Dombeck that section 401
certification is not required for nonpoint source discharges does not
compel a different interpretation with respect to these scope issues.
Dombeck, 172 F.3d at 1098-99. Nor does EPA's interpretation of section
401(d)'s term ``applicant'' as authorizing states to add certification
conditions that might protect ``non-federal waters'' in any way broaden
the scope of the Federal regulatory programs enacted by the 1972 CWA
amendments, e.g., sections 402 and 404, beyond the limits that Congress
intended. See 85 FR 42234-35. Section 401, although a neighbor to
sections 402 and 404 in the CWA's organizational framework, is a
fundamentally different provision and

need not be interpreted according to those other provisions'
strictures.
    EPA is not offering an opinion in this rulemaking about what
characteristics such a ``State law'' or ``Tribal law'' must have to
qualify as an appropriately ``legal'' basis for certification review or
conditions under sections 401(a)(1) or 401(d). In the spirit of
cooperative federalism, EPA defers to the relevant state and tribe to
define which of their state or tribal provisions qualify as appropriate
``State laws'' or ``Tribal laws'' for purposes of implementing section
401.
    EPA requests comment on this proposed definition of ``water quality
requirements,'' EPA's basis for proposing it, and any other potential
definitions of the term ``water quality requirements'' EPA should
consider adopting in the final rule.

F. Certification Decisions

1. Decisions on a Request for Certification
    The CWA allows certifying authorities to make one of four decisions
on a request for certification pursuant to their section 401 authority.
A certifying authority may either grant certification, grant
certification with conditions, deny certification, or it may expressly
waive certification. A certifying authority may also constructively
waive certification by failing or refusing to act in the reasonable
period of time. This section briefly discusses each of the four
decisions a certifying authority may make, including what each decision
means and its impact on the Federal licensing or permitting process.
This proposed interpretation of the four decisions a certifying
authority may make is consistent with the Agency's interpretation in
the 1971 and 2020 Rules.
    First, a certifying authority may grant certification. A grant of
certification means that the certifying authority has determined that
the federally licensed or permitted activity as a whole will comply
with water quality requirements. See section V.E in this preamble for
further discussion of the scope of certification and the term ``water
quality requirements.'' Granting certification means that the license
or permit may be issued. See 33 U.S.C. 1341(a)(1). Section 401(a)(1)
provides that in circumstances where there are no applicable water
quality requirements for an activity, the certifying authority ``shall
so certify.'' Id. EPA is proposing minor revisions to the regulatory
language currently located at Sec.  121.7(f) that describes this
scenario, with minor edits to reflect the proposed scope of
certification.
    Second, a certifying authority may grant certification with
conditions. A grant of certification with conditions means that the
certifying authority has determined that the federally licensed or
permitted activity as a whole will comply with water quality
requirements, but only if certain conditions are met. Section 401(d)
provides that any certification condition shall become a condition on
the Federal license or permit. Id. at 1341(d) (``Any certification
provided under this section shall set forth any effluent limitations
and other limitations, and monitoring requirements necessary to assure
that any applicant for a Federal license or permit will comply with
[sections 301, 302, 306, and 307], and with any other appropriate
requirement of State law set forth in such certification, and shall
become a condition on any Federal license or permit . . . .). As
discussed later in section V.G in this preamble, circuit courts have
routinely held that Federal agencies may not question or criticize a
state's water quality conditions. See, e.g., American Rivers, 129 F.3d
at 107 (``[Section 401(d)] is unequivocal, leaving little room for FERC
to argue that it has authority to reject state conditions it finds to
be ultra vires.''). Granting certification with conditions means the
Federal license or permit may be issued, provided the conditions are
incorporated into that license or permit. The 2020 Rule includes
regulatory text on the incorporation of certification conditions into a
license or permit. See 40 CFR 121.10. The Agency is not proposing to
retain any regulatory text on the incorporation of certification
conditions. First, the 2020 Rule limits incorporation of certification
conditions to only those that satisfy the content requirements at Sec.
121.7(d). Section 401(d) clearly requires all certification conditions
to become conditions on a Federal license or permit and does not limit
incorporation to only those conditions that include certain regulatory
defined components. As discussed in section V.G in this preamble, EPA
does not interpret the statute as allowing a Federal agency to review
whether a certifying authority included certain regulatorily defined
elements in its certification decisions, nor question certifying
authority conditions. Second, while the 2020 Rule requires Federal
agencies to clearly identify certification conditions in their Federal
license or permit, section 401 does not require Federal agencies to
distinguish certification conditions from other condition in their
licenses or permits. If the Federal agency finds it useful to
distinguish certification conditions for implementation purposes, the
Federal agency may structure its license or permit in such a manner,
but EPA does not find it necessary for the Agency to require such a
distinction.
    Third, a certifying authority may deny certification. A denial
means that the certifying authority is not able to certify that the
activity as a whole will comply with water quality requirements. If a
certifying authority denies certification, the license or permit cannot
be issued. 33 U.S.C. 1341(a)(1). The 2020 Rule includes regulatory text
that discusses the effects of a denial of certification. See 40 CFR
121.8. The Agency is not proposing to retain any regulatory text that
speaks to the effects of a denial of certification. First, the 2020
Rule provides that a certification denial does not preclude a project
proponent from a submitting a new certification request. Section
401(a)(1) provides that a license or permit may not be granted if
certification is denied, but it does not speak to new certification
submittals following a denial. EPA does not find it necessary to add
any additional direction or process for certification denials, beyond
defining the contents of a certification denial (as discussed below).
If a project proponent disagrees with a certifying authority's denial,
the project proponent may challenge the certifying authority's decision
in the appropriate court of jurisdiction. See S. Rep. 92-414 at 69
(1971) (``Should such an affirmative denial occur no license or permit