New Indiana Wetlands Law Allows Builders to Benefit from Federal Water Rule

Indiana Gov. Eric Holcomb (R) signed a state wetlands bill into law last month, marking a big victory for the Indiana Builders Association (IBA) and members across the state. Enactment of Senate Bill 389 ensures developers and builders in Indiana benefit from NAHB’s 2020 regulatory victory under the Trump administration’s Navigable Waters Protection Rule (NWPR) under the federal Clean Water Act (CWA).

The NWPR removed from federal control, and thereby federal wetlands permitting requirements under the CWA, all ephemeral features (i.e., wetlands, streams, and ditches) while also significantly narrowing federal control over so-called isolated wetlands.

However, Indiana already had state wetlands permitting and compensatory mitigation requirements for developers and builders whose land development or construction activities impact isolated wetlands as well as some ephemeral features. As a result, despite the benefits to the home building industry at the federal level under the NWPR, developers and builders in Indiana still needed to comply with state wetlands permitting requirements for impacts to isolated wetlands and ephemeral features commonly found on former agricultural lands.

“SB 389 is common sense legislation,” Christian Rector of Arbor Homes said. “It left in place protections for environmentally valuable habitats while removing regulations on areas that are typically nothing more than poorly drained farm ground, manmade ditches or simply a broken drainage tile. In many cases, this will result in significant savings that can be passed on directly to the buyer. In other cases, projects that were previously infeasible can now move forward.”

With enactment of SB 389, Indiana will no longer require developers and builders to obtain state wetlands permits, nor perform compensatory mitigation, for impacts to isolated wetlands found on former agricultural land. In addition, Indiana will no longer require state wetlands permits for impacts to any ephemeral features (ditches, wetlands or streams), which is consistent with the federal wetlands program following the Trump administration’s promulgation of the NWPR. These changes will help keep housing affordable in the state and expand the areas where members can build.

“We appreciate the efforts of many in the Indiana General Assembly who made the right vote on SB 389 to reduce the regulatory burdens on property owners and small businesses this past session,” commented Rick Wajda, IBA CEO. “SB 389, dealing with isolated wetlands, will roll back red tape and reduce overly burdensome regulations that stifle economic development across Indiana. Gov. Holcomb, Lt. Gov. Crouch, and leadership in the House and Senate understand the importance of growing Indiana’s economy and the need for housing that is achievable. The IBA and its members are excited to help take Indiana to the next level.”

If your state is considering statutory changes to existing state wetlands requirements to reflect recent federal changes under the NWPR or has conflicting wetlands requirements that prevent builders from benefitting from the federal rule, NAHB’s Intragovernmental Affairs team can help. For more information, contact Robyn Matthews.