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2023 Quarters 1 and 2 Regulatory Update

During the first and second quarters of 2023, there were several regulatory developments involving federal agencies. These updates are summarized in the following subsections.


On June 4, 2021, the United States (U.S.) Fish and Wildlife Service (USFWS) and the National Oceanic and Atmospheric Administration’s National Marine Fisheries Service, together the “Services,” announced a plan to improve and strengthen implementation of the federal Endangered Species Act (ESA). The plan includes a set of proposed actions that follow Executive Order 13990 (Protecting Public Health and the Environment and Restoring Science To Tackle the Climate Crisis) and endeavors to ensure the ESA effectively addresses 21st century conservation challenges, such as climate change.

The proposal includes revisions to three final rules issued in 2019 that address responsibilities that the Services share under sections 7 and 4 of the ESA. The proposed revisions are intended to improve and clarify the interagency consultation processes under Section 7 and how the Services make listing, delisting, and reclassification decisions, as well as how the Services will designate critical habitat. The USFWS also proposes to reinstate the 4(d) “blanket rule” options that were in place before 2019 for protecting threatened species. This will allow for greater efficiencies when the “blanket rule” protections are appropriate. Further details on the three proposed rules are included in the subsections that follow.

Section 7 Proposed Rule

Revising regulations for interagency cooperation: The Services are proposing to revise the 2019 final rule regarding the regulations governing Section 7 consultation. The proposed revisions include clarifying the definition of “effects of the action” and “environmental baseline,” removing 402.17 “Other Provisions,” clarifying the Services’ responsibilities regarding re-initiation of consultation, and revising the provisions related to reasonable and prudent measures in an incidental take statement. 

Section 4 Proposed Rule

Revising regulations for listing species and designating critical habitat: The Services are proposing to revise the 2019 final rule regarding listing and reclassification of species and designation of critical habitat. The revisions propose to reinstate prior language affirming that listing determinations are made “without reference to possible economic or other impacts of such determination,” revise the foreseeable future framework, clarify the standards for delisting species, and revise when and how critical habitat is designated through revisions to the criteria for when critical habitat may be not prudent and the criteria for designation of unoccupied critical habitat. 

Section 4(d) Proposed Rule

Reinstating a protection option for species listed as threatened under the ESA: The USFWS is proposing to reinstate its “blanket” 4(d) rules, which were withdrawn in 2019. The blanket 4(d) rules provide an option to extend most protections provided to endangered species to those listed as threatened, unless the USFWS adopts a species-specific 4(d) rule.

These proposed rules were published in the Federal Register on June 22, 2023 with 60-day comment periods that end August 21, 2023.

Section 10 Proposed Regulations

On February 9, 2023, the USFWS published proposed revisions to its regulations governing incidental take and enhancement of survival permitting under Section 10 of the ESA. The purpose of these revisions is to encourage greater participation in the permitting process and in voluntary conservation efforts. The Proposed Rule makes several changes to the current Section 10 regulations and codifies certain aspects of USFWS guidance.

First, it combines Candidate Conservation Agreements (for the protection of species that are candidates for listing) and Safe Harbor Agreements (for the protection of species on private land). Both agreements would be referred to as Conservation Benefit Agreements under the Proposed Rule. The Proposed Rule clarifies that the USFWS can issue such agreements and permits for non-listed species, including in situations where no listed species are present. The Proposed Rule also codifies various definitions, including “net conservation benefit” for Conservation Benefit Agreements. Additionally, the USFWS proposes to add a provision, stating that an applicant for a voluntary Conservation Benefit Agreement can choose whether to return the property to the baseline condition.

Regarding Habitat Conservation Plans (HCPs), the Proposed Rule incorporates the application and approval requirements found in the HCP Handbook. The Proposed Rule also explains that applications for incidental take permits under Section 10(a)(1)(B) must include an HCP that includes the following (taken from the Five Point Policy in the HCP Handbook):

  • goals and objectives that are measurable biological goals and objectives of the conservation plan;
  • anticipated take, including the expected timing, geographic distribution, type and amount of take, and the likely impact of take on the species;
  • conservation measures to minimize and mitigate the impacts of the incidental take;
  • monitoring measures to ensure the effectiveness of the mitigation and minimization measures, progress toward achieving the biological goals and objectives, and permit compliance; and
  • an adaptive management plan.

The Proposed Rule is forward-looking, meaning that it only applies to new permit applications. Existing permits will be unaffected.


Waters of the U.S. Definition

Jurisdictional evaluations related to the extent of Clean Water Act jurisdiction between the U.S. Army Corps of Engineers (Corps) and U.S. Environmental Protection Agency (EPA), together the “agencies,” continue. The U.S. Supreme Court’s May 25, 2023 decision in the case of Sackett v. Environmental Protection Agency forces the agencies to amend the final “Revised Definition of ‘Waters of the United States’” rule, published in the Federal Register on January 18, 2023. The agencies intend to issue a final rule by September 1, 2023. 

In the interim, the EPA has provided an informational map that illustrates which definition of “waters of the United States” is generally operative in each state across the country as a result of litigation challenging the 2023 Rule. Please note that it cannot be relied on for specific determinations or other legal purposes as litigation continues. The EPA will update the map, when possible, to reflect the most current information. Additionally, the agencies will interpret the phrase “waters of the United States” consistent with the Supreme Court’s decision in Sackett.


Standards and Practices for All Appropriate Inquiries (AAI) – Final rule

The EPA took final action to amend the Standards and Practices for All Appropriate Inquiries (AII) to reference a standard practice recently made available by ASTM International, a widely recognized standards organization. Entities potentially affected by this action or who may choose to use the newly referenced ASTM International standard to perform AIIs include public and private parties who, as bona fide prospective purchasers, contiguous property owners, or innocent landowners, are purchasing potentially contaminated properties and wish to establish a limitation on the Comprehensive Environmental Response, Compensation, and Liability Act (CERCLA) liability in conjunction with a property purchase.

The final rule amends the AAI rule to reference ASTM International’s E1527–21 ‘‘Standard Practice for Environmental Site Assessments: Phase I Environmental Site Assessment Process’’ and allow for its use to satisfy the requirements for conducting AIIs under the CERCLA.

The new standard provides for an optional emerging contaminants review as a non-scope item for a Phase I Environmental Site Assessment (ESA). Emerging contaminants are substances that are not defined as hazardous under CERCLA, but may be considered hazardous substances under state law or otherwise. ASTM E1527-21 expressly states that emerging contaminants include per- and polyfluoroalkyl substances, also known as “PFAS.” Traditionally, Phase I ESAs have included statements regarding non-scope considerations such as the possible presence of lead-based paint and asbestos-containing materials. This non-scope process is now expanded and more formalized under ASTM E1527-21, and will likely increase the number of Phase I ESAs addressing the presence of PFAS.

The new ASTM E1527-21 also includes the following significant changes:

  • greater specificity in the definition of a Controlled Recognized Environmental Condition (“CREC”) to provide clarification as to the treatment of regulatory closure letters and satisfaction of current unrestricted use criteria, as well as examples of CRECs;
  • changes to the definition of “de minimis condition,” which is now defined in terms of a condition related to a release, as well as various examples of de minimis conditions;
  • changes to the definition of a Historical Recognized Environmental Condition (“HREC”) to clarify that a site must meet current unrestricted use criteria without any property controls, as well as various examples of HRECs;
  • expansion of historical research required to be conducted to include various new sections, including requirements related to property identification history and historic uses of adjoining properties; and
  • changes to the viability period of Phase I ESA reports stating that the reports are now valid for 180 days from the date of certain report components prior to the date of acquisition (or, for leases or refinancing, the date of the intended transaction), and the report must identify the dates of these components in the report.

The Final Rule issued in the Federal Register on December 15, 2022 became effective on February 13, 2023; however, the previous version, ASTM E1527-13, may be used until February 13, 2024, at which time ASTM E1527-13 will be completely replaced by the ASTM E1527-21.


During the first and second quarters of 2023, there were several regulatory developments involving the State Water Resources Control Board (SWRCB), the California Public Utilities Commission (CPUC), and the Governor of California. These updates are summarized in the following subsections.


General Permit for Stormwater Discharges Associated with Construction and Land Disturbance Activities (General Permit) Order WQ 2022-0057-DWQ

This new General Permit was previously discussed in Insignia’s 2022 Quarter 1 Regulatory Update during the public comment period, but now that it has been finalized, more information is summarized below. In May 2021, the SWRCB notified the public of a draft permit reissuance; after additional public comments and review, the General Permit was adopted on September 8, 2022. The permit will become effective on September 1, 2023, and there will be a 2-year grace period for existing projects to obtain coverage under the new General Permit by September 1, 2025. Changes to the to the General Permit include the following:

  • new programmatic permitting permit enrollment options for linear utility construction projects that allow for groups of similar projects within one Regional Water Quality Control Board (RWQCB) office boundary (e.g., electrical transmission, natural gas transmission, wildfire prevention) to be covered under a single waste discharge identification number and a common Stormwater Pollution Prevention Plan (SWPPP); 
  • updated monitoring and reporting requirements, including requirements for some types of inspections to be conducted by a Qualified SWPPP Practitioner, and in some cases a Qualified SWPPP developer;
  • updated definitions for the types of precipitation events that trigger inspections, and the elimination of the requirement for a Rain Event Action Plan;
  • new requirements addressing discharges from dewatering activities and passive treatment technologies;
  • new requirements for dischargers covered by the General Permit to implement existing total maximum daily loads adopted by RWQCBs into applicable basin plans for constituents other than sediment which include, but are not limited to toxics, metals, indicator bacteria and temperature;
  • new eligibility criteria for permit enrollment through a Notice of Non-Applicability for projects with physical locations that are not hydrologically connected to waters of the U.S.;
  • updates to the Notice of Termination (NOT) process at project completion, including additional submittal requirements and a 30-day timeline for automatic NOT approvals; and
  • updated stormwater sampling requirements for runoff from project sites and revisions to the methods of determination for Numeric Action Level exceedances.


Draft Statewide General Waste Discharge Requirements for Discharges of Dredged or Fill Material to Waters of the State from Emergency Repair and Protection Activities

A draft General Waste Discharge Requirements Order (General WDR) was announced by the SWRCB on April 28, 2023 in order to streamline the permit process for emergency activities that take place in waters of the state, resembling the regional general permit process that currently exists for federal waters. Emergency activities are defined under CEQA as “a sudden, unexpected occurrence, involving a clear and imminent danger, demanding immediate action to prevent or mitigate loss of, or damage to, life, health, property, or essential services. Occurrences such as fire, flood, earthquake, and landslide, as well as accidents, are examples of emergencies under this definition.” Activities authorized under this coverage may include bank stabilization, restoration of damaged areas, temporary fills, and more. The public review and comment period was open for 32 days and closed on May 30, 2023. The draft and public comments are currently under review by the SWRCB.


Order Instituting Rulemaking to Update and Amend Commission General Order 131-D

On May 18, 2023, the CPUC adopted a proposed Order Instituting Rulemaking (OIR) that updates the CPUC’s General Order 131-D. Prior to the rulemaking, General Order 131-D, which was originally adopted on June 8, 1995, and modified on August 11, 1995, outlined the CPUC’s process for reviewing electric utility construction projects, as it required these projects to obtain a certificate of “public convenience and necessity” (CPCN) prior to construction. By January 1, 2024, the General Order will be updated to add Public Utilities Code Section 564, allowing electric utilities to use a Permit to Construct process for their construction projects, rather than the lengthier CPCN process. This update is expected to shorten the approval time to approximately 1 year from the prior multi-year process.


CEQA and Permit Streamlining

California Governor Gavin Newsom signed Executive Order N-8-23 on May 19, 2023, which requiring the creation of an Infrastructure Strike Team. The Strike Team will work with state agencies regarding infrastructure projects in order to “maximize federal and state funding opportunities.” The Strike Team’s goal is to identify projects that are eligible for streamlining, assist in coordination with state agencies, and update permitting status for projects to move the environmental review process forward. Working groups for the Strike Team will be comprised of transportation, energy, hydrogen, environmental remediation, broadband, water, CHIPS and Science Act, and zero-emission vehicles teams.

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