By Riley Johnson, State Director of the National Federation of Independent Business
The White House just approved an Environmental Protection Agency and Army Corps of Engineers’ rule that could give the agencies vast new power over water. The impact of this will be felt by every farmer and rancher in Montana.
The new rule defines the waters of the United States so expansively that the federal government could apply the decades-old Clean Water Act to creeks, small ponds and even streambeds that are dry much of the year. The Clean Water Act was supposed to govern navigable waterways, not every place where water could possibly flow or pool.
House Resolution 1732 would stop the rule, and kudos to Montana Rep. Ryan Zinke for voting in favor of it. Now Sens. Steve Daines and Jon Tester need to act to protect small business, either by supporting similar legislation or by including language in the appropriations process that could halt the rule from moving forward.
Compliance and enforcement could put several family agricultural businesses in the poor house. Even before the new rule, the average cost of a Clean Water Act permit cost $270,000 and daily fines for violations can reach up to $37,000.
There really isn’t a small business out there that can afford these costs.
“This has the potential to bring local development to a stop and make it much more difficult for small businesses to make even minor improvements to their properties,” said Dan Danner, president and CEO of the National Federation of Independent Business. “It gives the EPA and the Army Corps of Engineers new power to regulate local projects and local businesses, and it creates for the trial lawyers and the environmental activists a whole new class of potential defendants.”
The way EPA and the Corps went about it was sordid. “The process was rigged in favor of the agencies,” said Dan Bosch, NFIB’s senior manager of regulatory policy. “They simply decided that they didn’t even need to consider the effects on small business. That analysis is required by law. It’s not optional.”
The new rule even drew rare public opposition from another government agency in the same administration. Last fall, the Small Business Administration Office of Advocacy wrote to the agencies expressing its concerns. The chief counsel for the office wrote that the waters rule could cost small businesses tens of millions of dollars. He asked them to withdraw it.
Recently, the Senate Small Business Committee held a hearing on the rule. A witness from the SBA Office of Advocacy again called for the rule to be halted. He said that refusal to conduct small business analysis was a violation of federal law and that there might even be room to sue the government if it isn’t done correctly. Beth Milito, NFIB’s senior executive counsel, testified at the same hearing and told senators that the uncertainty of federal regulation could lead many owners to forgo development.
Small businesses employ half of all Americans, but it’s regulations like this that make it hard for more people to find a job. Do we want business owners using their limited resources on red tape, or on growing their business? When a manufacturer builds a new facility or a farmer grows more crops, there are many who benefit. When the government makes it hard to do these things, we all lose out.
“The states do a much better job of balancing environmental protection with economic development because they need both,” said Danner. “This [new rule] tips the scale in favor of distant regulators and ideologues who won’t have to live with the consequences.”
The new rule is wrong on many counts and deserves to be stopped.

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