Regulating in the Dark

A comprehensive deal to reform federal permitting will likely include changes to Clean Water Act (CWA) Section 401. Section 401 grants states and Tribes authority to certify, block, or impose conditions on federally permitted activities that may result in a discharge into state or Tribal waters.

The political and policy dynamics surrounding Section 401 reform are complicated. In 2016, New York state began to use Section 401 to block gas pipelines on climate change grounds. The CWA gives states broad deference on what they may consider when issuing Section 401 certifications, and New York also cited water quality impacts. But Republicans and their stakeholders argue that the reasons for the pipeline rejections were “wholly unrelated to water quality.” Section 401 also implicates dam re-licensing, which can drag on unresolved for years under current law.

Compounding the political and policy complexity is the near-total absence of usable, decision-layer data on how the program works. The most important decisions made under Section 401 are fragmented across states, buried in agency files, and often folded into other Clean Water Act permitting regimes. In many cases—especially under state-administered National Pollution Discharge Elimination System (NPDES) programs—states embed Section 401 certification conditions into the permit itself. In turn, a substantial portion of decision-making under Section 401 doesn’t exist as an identifiable dataset, even though its effects are reflected in permit outcomes.

That makes the impact of Section 401 hard to study. For policymakers, it’s unclear how to respond to or fix issues with Section 401. There is no comprehensive data to inform whether existing challenges reflect a pervasive national problem or just a narrower set of high-friction cases concentrated in particular sectors, states, or agencies.

To solve this data problem, policy makers don’t need a maximalist archive of every certification document. Rather, sound analysis requires clean, high-level data that lets us see and understand Section 401 decision-making. This type of information will inform the scale and scope of repairs needed for the program in the long term.

Now, it’s important that the current Congress enacts Section 401 reforms this term as part of a comprehensive permitting reform package. Herein lies the rub. Congress may soon need to make choices on Section 401 before comprehensive data can become available.

But that doesn’t diminish the case for future-proofing Section 401 decision-making against guesswork. The long-term impact and viability of reforms currently under consideration, like limiting review to water-quality impacts, will depend on the quality of information we have on Section 401 certification. Negotiators should enact reforms to build these datasets along with the statutory changes that facilitate a broader package of permitting reforms.

Permitting reform needs to be a long-term, iterative effort across many statutes. Better to have data informing decisions along the way.

The Section 401 policy problem in the void

Two key policy issues dominate the Section 401 policy debate. First, the one-year time limit on certification has proven difficult to implement in certain high-profile circumstances. And second, states have used their latitude under the Section 401 program to incorporate and address environmental issues, mainly climate change, that are arguably unrelated to Section 401’s narrow focus on water quality issues.

States and project sponsors have exploited loopholes to circumvent the one-year limit. This issue has reached the federal courts. It has emerged as a stalling tactic states can deploy for disfavored projects. In Hoopa Valley, the States of California and Oregon strategically withdrew and resubmitted the same 401 certification request for over a decade. They thereby usurped “FERC’s control over whether and when a federal license will issue.”

This sort of scheme introduces risks for projects that may cross multiple states. A politically contentious transmission line or pipeline can involve multiple state authorities and multiple opportunities to game the Section 401 timeline.

The court in Hoopa Valley ruled that the withdraw-and-resubmit scheme was illegal. But the facts of Hoopa Valley may not reflect a widespread trend. Dams and pipelines may be the only true friction points. The best policy solution, therefore, should perhaps account for agency institutional characteristics, e.g., that the Federal Energy Regulatory Commission (FERC) is the permitting authority for those project types.

The SPUR Act, for example,would transfer authority to FERC for gas pipeline water quality certifications. But that solution may leave other problems in place with other types of projects.

The second major policy concern is that states sometimes use Section 401 to block projects because they oppose fossil fuels. Republican stakeholders, for instance, cried foul when New York state used climate change as the reason for denying certification to multiple natural gas pipelines. They argue that climate change is not a water quality impact resulting from a discharge. But, without proper data, it’s difficult to say whether the insertion of state objections into the Section 401 process that are not about water quality, strictly understood, is large or small. While there are anecdotal cases of Section 401 being leveraged to oppose projects on the grounds of things like climate, noise, or traffic, anecdotes are insufficient to inform our policy options.

States and 401: Inconsistent and Unusable Certification Data

The Clean Water Act gives states and Tribes the responsibility to administer and implement the Section 401 program. One implication of this division of authority is that no centralized federal repository exists to track Section 401 certifications. To assess the program and how to develop the missing central clearinghouse, we sought Section 401 records under four key states’ public records process—West Virginia, New York, Massachusetts, and North Carolina. In each state, Section 401 certifications were central to fights over pipeline construction.

Although legally accessible in principle, agencies retained broad discretion over how records were organized and produced, often rendering them analytically unusable. Our experience across these states illustrates the structural barriers to studying Section 401, much less building a comprehensive dataset.

West Virginia. West Virginia’s disputed Section 401 water quality certification for the Mountain Valley Pipeline yielded extensive litigation and drastically higher development costs. A pipeline that would have initially cost $3.5 billion cost nearly $10 billion. Congress had to intervene in a statute to force the project to approval. Yet the state's records proved difficult to analyze. Available files lacked searchable metadata on applicants, timelines, project characteristics, or outcomes. It’s even unclear what documents are certifications. Obtaining the full set of records required labor-intensive downloads of thousands of documents.

New York. The New York Department of Environmental Conservation (NYDEC) has denied or attempted to deny Section 401 certifications for at least four gas pipelines since 2016. For two of those pipelines, denials cited climate change as a primary factor.These cases sit at the center of the debate over whether states use Section 401 to pursue policy objectives beyond water quality. Yet obtaining the underlying data proved difficult. Because certification records are dispersed across NYDEC’s nine district offices, the agency determined that producing all certifications and applications would be too time-consuming and therefore infeasible. Instead, it offered a subset of denial records. We made our initial request in December 2025. After repeated delays, we have not received the records.

Massachusetts. In 2016, Massachusetts issued a Section 401 certification of Tennessee Gas’s Connecticut Expansion Project with 47 conditions. As a land-use mitigation, Massachusetts required the company to convey 36 acres of forest, wetlands, and open fields to the state to offset 4,792 square feet of wetland fill. Conditions like these avoid the conflict of a denial or lawsuit but add costly, time-consuming demands. The underlying Section 401 data is not publicly available. After our second attempted contact, Massachusetts Department of Environmental Protection (MassDEP) estimated the cost at nearly $1,500 to fund the staff’s 60 hours of search time to produce the state’s Section 401 certification records.

North Carolina. In North Carolina, the Atlantic Coast Pipeline demonstrates how Section 401 can shape project outcomes even without a formal denial. The NC Department of Environmental Quality (DEQ) issued the certification in January 2018. In August 2019, a coalition of community and environmental groups petitioned the agency to revoke it. The coalition cited newly discovered impacts on the Lumbee community and inadequate analysis of cumulative water quality effects. NC DEQ did not publicly act on the petition before Dominion Energy and Duke Energy canceled the $8 billion project in July 2020. North Carolina keeps a publicly accessible database. However, the files did not have metadata, making it unsearchable and unusable. Organized in county folders, the information consists of handwritten documents, emails, and other certification-related paperwork.

Despite maintaining records of Section 401 decisions, none of these states could readily provide information suitable for systematic policy analysis.

Cross-cutting lessons for Section 401 data inquiries

There is no national database to house Section 401 certification records and no requirement for states to report certification data to EPA or any other candidate central repository. Program administration is fragmented across states, Tribes, and territories with varying resources and priorities. This makes national analysis effectively impossible.

EPA is a natural candidate to fill this gap. EPA defines through rulemaking what Section 401 certifications must protect. EPA already receives interstate certification notices when discharge from one state may affect water quality in another, tracks water quality outcomes through its oversight role, and operates national databases covering other major Clean Water Act programs. A national 401 data repository is the logical completion of a system that already exists in pieces.

Relevant information already exists throughout the permitting system. EPA databases capture nearly every major Clean Water Act decision layer except the certification itself. FERC and the U.S. Army Corps of Engineers maintain certification records within their own permitting files. But these exist as administrative records rather than structured datasets. Because they are not standardized, linked, or shared, certification decisions cannot be connected to permitting timelines, project characteristics, or water quality outcomes. The result is a program that cannot be evaluated systematically.

Some state databases are better than others. Colorado provides an interactive map with descriptions of water quality certifications. Illinois provides clear legal information on its website.

But the performance of a few well-resourced states cannot substitute for a functioning national system of CWA implementation and water quality certification documentation. None of these systems facilitates analysis of the program. The structure of Section 401 effectively precludes comprehensive national evaluation and concomitant reform. Without substantial data reconstruction from fifty-plus distinct systems, each determined by its own administrative culture and institutional capacity, designing statutory and procedural improvements is challenging.

How to fix our broken system for tracking Section 401 implementation

The practical consequence of this data vacuum is that policymakers base their debates and decisions about Section 401 on anecdote rather than evidence. Sector-specific claims dominate the conversation. States may indeed block pipelines or overreach. But the data to evaluate those claims systematically does not exist.

Critics frequently cite New York’s decision-making on the Northeast Supply Enhancement pipeline as an example of a state certification authority obstructing interstate energy infrastructure. But without systematic information on denial rates, approval timelines, and certification conditions, we are debating reforms to a program we cannot empirically describe as a whole or determine whether visible cases are representative.

That missing evidence matters because the reform options under discussion would alter Section 401 in different ways. Congress could narrow the statute to exclude non-water-quality considerations from certification decisions and pair that change with firmer timeline constraints. It could transfer certification authority for gas pipelines to FERC, as the SPUR Act proposes. Or it could create a separate certification process for pipeline projects that limits the scope of state review and shortens the timeline. Each approach responds to a different diagnosis of the problem and would fit differently into permitting reform negotiations. If delays and overreach are concentrated in pipelines and dams, sector-specific reform may be enough. If non-water-quality considerations appear broadly across project categories, a general statutory narrowing may be warranted. But without data on denials, timelines, conditions, project types, and agency practices, Congress cannot know which reform would solve the problem, which would leave dysfunction in place, and which might create unintended consequences for the rest of the program.

In developing a better method to standardize and make this data available, one objection might be that a federal reporting requirement could intrude on state authority. Congress delegated Section 401 for states to carry out. The anti-commandeering principle, a limit the Supreme Court set in New York v. United States and Printz v. United States, establishes that Congress cannot compel states to administer a federal program. A reporting requirement, therefore, must fit within that limit. Also, with existing statutory authority, EPA likely cannot impose such a requirement on states through rulemaking alone.

The Clean Water Act's NPDES permitting program, established under Section 402, sets an example for addressing these concerns. NPDES pairs standardized reporting with program authorization. A state that chooses to run the program accepts federal reporting standards as part of the deal. For the handful of states that decline to accept this authority, EPA administers the program directly, ensuring that the model does not break down. Section 401, on the other hand, grants states certification authority with no corresponding reporting obligation, leaving the programs' most consequential decisions opaque.

Congress likely has authority to amend Section 401 to require standardized reporting as a condition of participation in the federal certification framework, similar to the reporting structure used in delegated NPDES programs. EPA already has analogous databases and an oversight role, which provide the foundation to run such a system. Appropriators will need to address the added strain on EPA staff and resources and the reporting effort asked of states.

State authority over the Section 401 program is important for preserving the structure of the Clean Water Act. A reporting requirement should not undermine that structure. Rather, such a requirement can standardize metadata (timelines, outcomes, conditions categories) without constraining substantive decision-making authority.

Improving the evidentiary basis for Section 401 policy would require standardized reporting of a limited set of metadata. These include:

- application receipt date and completeness determination

- decision date

- outcome (granted, granted with conditions, denied, waived, or withdrawn and resubmitted)

- type of underlying federal permit (e.g., NPDES, dredge-and-fill, FERC license)

- whether certification conditions were issued as a standalone document or incorporated into another permit

- general project category (e.g., pipeline, transmission, wetlands, hydropower)

- high-level classifications of any conditions imposed

Paired with a link to the underlying administrative record, this kind of reporting would make Section 401 decisions visible and comparable without constraining state authority or requiring reconstruction of the entire program. Such data would be ripe for AI-driven analysis to inform policy changes.

Modest transparency improvements would allow policy makers to determine whether and where to make broader reforms. As Congress presses ahead with permitting reform negotiations, it’s possible that even the success of reforms depends on whether their effects are measurable. Congress shouldn’t continue to regulate in the dark.