On June 16, the Tennessee Board of Water Quality, Oil and Gas (“Board”) formally adopted proposed amendments to the State’s Aquatic Resource Alteration Permit (“ARAP”) rules, codified at Tenn. Comp. R. & Regs. 0400-40-07. The proposed amendments are primarily intended to align the Tennessee Department of Environment and Conservation’s (“TDEC”) regulations with new wetlands legislation signed into law on May 9. The proposed amendments also clarify existing requirements and add new permit exceptions for certain construction activities occurring outside the top of banks (e.g., directional boring and span bridges), further reducing regulatory burden on developers and other regulated entities.
Tennessee’s New “Isolated” Wetlands Legislation
In response to the U.S. Supreme Court’s 2023 landmark Sackett decision, which eliminated federal jurisdiction over “isolated” wetlands, Gov. Lee signed SB 670 into law, removing barriers to developing in isolated wetlands within the State. The new law defines “isolated” wetlands as waterbodies that do not have a continuous surface connection to a relatively permanent body of water connected to traditional interstate navigable waters. The new law also establishes categories of isolated wetlands based on their ecological value, and assigns varying levels of allowable alterations based on the statutory classification of a particular isolated wetland, as outlined below:
- Artificial Wetlands. Artificial wetlands created purposefully or inadvertently by humans or beavers within the past 5 years can be altered with no regulatory oversight if:
- No toxic pollutants are discharged;
- Sediment does not enter any streams and surface waters; and
- Steps are taken to prevent petroleum and pollutants from entering state waters.
- Low-Quality Wetlands.
- Up to 1 acre of low-quality wetlands can be altered without any notice, approval, or mitigation, if pollution and sediment controls are in place.
- General permit coverage is required for impacts between 1-2 acres of low-quality wetlands, but such permits may not impose certain additional burdens, including riparian buffers, anti-degradation analysis, or cumulative impact assessments.
- Impacts to greater than 2 acres require an Individual Permit.
- Moderate-Quality Wetlands.
- Up to ¼ acre of moderate-quality wetlands can be altered without any notice, approval, or mitigation, if pollution and sediment controls are in place.
- General permit coverage is required for impacts between ¼-2 acres of moderate-quality wetlands, but such permits may not impose additional burdens, including riparian buffers, anti-degradation analysis, or cumulative impact assessments.
- Impacts to greater than 2 acres require an Individual Permit.
- High-Quality Wetlands. Any alterations require an Individual Permit.
Notably, the new law prohibits TDEC from considering the impacts to isolated wetlands of any quality when determining the project’s cumulative impact, even if the project encompasses other federally regulated wetlands. The new law also streamlines the process for identifying wetlands on property; property owners can request a determination from TDEC by submitting a wetland resource inventory report prepared by a third-party consultant. If TDEC does not challenge the wetland inventory report within 30 days, it is presumed correct from a regulatory standpoint.
Regulatory Amendments Implementing SB 670
As noted above, the regulatory amendments adopted by the Board were principally intended to align the State’s ARAP regulations with the statutory charges reflected in SB 670. To that end, the revised ARAP regulations contain new and updated definitions for isolated and artificial wetlands as well as high-quality, moderate-quality, and low-quality wetlands.
The regulations also outline the levels of compensatory mitigation required for alterations for each class of isolated wetlands. For purposes of determining the need for compensatory mitigation, the regulations will also clarify how a project’s cumulative impacts will be analyzed, as shown here:
- Multiple stream alterations on a construction site, including adjacent sites part of a common plan of development or sale, conducted within a 5-year period will be evaluated together.
- Multiple stream alterations within a linear project will be evaluated together.
- Multiple alterations cumulatively exceeding the threshold for general permit coverage may require compensatory mitigation (stream alterations are considered within the same stream segment and wetland alterations are considered within the same HUC 12 sub-watershed).
- Impacts to isolated and artificial isolated wetlands are not considered as part of TDEC’s cumulative impact analysis.
Exemptions for Directional Boring and Span Bridge Construction
Another important change that has flown relatively under the radar is TDEC’s expanded list of activities that are exempt from ARAP permitting. The regulations now exempt any “construction activities conducted outside the top of stream banks (e.g., directional boring), and stream crossings that only span the outside of the top of stream banks, which do not alter or adversely affect the classified uses of waters of the state….” Tenn. Comp. R. & Regs. 0400-40-07-.02(1).
The Board adopted these new exemptions, notwithstanding opposition from environmental groups, clearing the way for pipeline companies and project developers to conduct horizontal directional drilling and span bridge construction, respectively, without prior approval from TDEC.
Effective Date
The amendments are set to become effective on December 17, 2026.
Butler Snow’s Environmental Regulatory Team is here to assist project developers and other regulated entities to align project goals with evolving federal and state environmental regulatory requirements. If you have any questions about how these changes might affect your business or projects, please contact J.W. Luna, B. Hart Knight, or Tim Roth for additional information.
