(August 28, 2019) – The U.S. Department of Justice (DOJ) released a new policy memo August 21 that significantly restricts the use of Supplemental Environmental Projects (SEPs) in settlement agreements with state and local governments, including wet weather consent decrees.  The new DOJ position comes despite strong pushback from EPA to limiting the use of SEPs.  

The DOJ memo states that the prohibition on SEPs is consistent with a November 2018 directive from then Attorney General Jeff Sessions which, among other things, limits the ability of the federal government to achieve policy goals or relief through settlement agreements that could not be obtained through litigation.  There is a limited exception to the ban on SEPs, but this exception requires the personal approval of the Assistant Attorney General in charge of DOJ’s environment division and will only be available in very limited circumstances. 

While there is some positive language in the new DOJ memo about the importance of federal deference to local governments in settlement agreements and the limited ability of DOJ to use settlement agreements for far-reaching relief, the loss of SEPs – which are an important way for a clean water agency to use funds locally that would otherwise go to the Federal Treasury – could negatively impact public clean water utilities in enforcement discussions. 

NACWA will be engaging with EPA, DOJ and key congressional committees to discuss our concerns with this new approach.  We will provide the membership with additional information as it becomes available.  Members with questions can contact Nathan Gardner-Andrews, NACWA’s Chief Advocacy Officer.