In response to the amended final Waters of the United States (WOTUS) rule issued by the Environmental Protection Agency (EPA) and U.S. Army Corps of Engineers, the National Association of Home Builders (NAHB) raised concerns about its potential impact on housing affordability and regulatory clarity.

This revised WOTUS rule, which the NAHB suggests emerged without public input from stakeholders, has raised alarms within the housing industry. The rule comes in the wake of the U.S. Supreme Court's decision in the Sackett v. EPA case, which clarified that federal authority extends only to relatively permanent waterbodies. However, according to the NAHB, the Biden administration did not define what constitutes a "relatively permanent" waterbody, leaving room for ambiguity.

 
Moreover, the updated WOTUS rule fails to exclude "ephemeral features," which only contain water following rainfall events, from federal jurisdiction. This lack of clarity could lead to continued federal overreach, bureaucratic delays during wetlands permitting, and regulatory confusion for home builders and land developers.

NAHB Chairman Alicia Huey expressed concerns, stating, "This new regulation will directly result in continued regulatory barriers to affordable housing as single-family and multifamily developers struggle to find the developable land necessary to produce the new affordable housing units this nation desperately needs."

Additionally, the situation is further complicated by the fact that several federal district courts had already issued preliminary injunctions against the Biden WOTUS rule released in January. As a result, the amended WOTUS definition will apply in only 23 states, the District of Columbia, and U.S. Territories, while the other 27 states adhere to the pre-2015 regulatory regime, before the Sackett decision.

To address this regulatory uncertainty, NAHB is actively involved in litigation in the 27 states, advocating for clear definitions and regulatory certainty. They are also engaging with EPA and U.S. Army Corps of Engineer officials to seek clarity for the other 23 states, urging expedited approvals for jurisdictional determinations and Clean Water Act 404 permits.

The agencies have announced plans to hold stakeholder hearings on the new rule, although these have faced capacity issues. NAHB is requesting expanded participation for industry stakeholders and plans to meet with federal officials to address concerns, propose pragmatic changes, and restore predictability to the federal wetlands permitting process.

https://www.nahb.org/blog/2023/08/new-wotus-rule