The US EPA was forced to withdraw a portion of its proposed storm water management regulations in the context of a pending court challenge by the National Association of Homebuilders (NAHB) and other parties. In the pending appeal to the United States Court of Appeals for the Seventh Circuit, the EPA filed an unopposed motion to vacate part of its final rule regarding “Effluent Limitations Guidelines and Standards for the Construction and Development Point Source Category”.

The rule proposed to establish a numeric effluent limitation on pollutants from construction and development. The rule limited turbidity to an average daily level of 280 “nephelometric turbidity units” (NTUs). EPA concedes in its motion that, “[T]he Agency has concluded that it improperly interpreted the data and, as a result, the calculations in the existing administrative record are no longer adequate to support …” the rule.

While we are not in a technical position to evaluate engineering and cost impacts of these regulations, NAHB has quoted, and ABC has supported, an estimate of up to $10 billion in cost annually to meet the overall national regulations as proposed by EPA. We just commented on the regulations generally last week and we believe this is a very significant issue for the construction and development industry. Ann Cosby at Sand Anderson’s Environmental Law blog has a nice summary post of the negotiations in Virginia over sediment limits for the Chesapeake Bay Watershed.

By agreement, the motion requested that the case be held in abeyance for 18 months until February 15, 2012, to allow EPA to address the flaw. It will be quite interested to see whether the partial retreat by EPA sets off a chain reaction of challenges or delays in other aspects of the pending regulations.