Environmental Justice and the Clean Water Act: Implications for Economic Analyses of Clean Water Regulations

Abstract

Since President Clinton’s 1994 Executive Order 12898, federal agencies have been required to conduct environmental justice (EJ) analyses of federal rules and regulations. More recently, the Biden Administration has instituted several major efforts to reform regulatory review and promote a more equitable distribution of environmental benefits and burdens. This paper seeks to understand how prior guidelines have been implemented in federal regulatory reviews related to the Clean Water Act and provide a baseline for future studies of the distributional effects of clean water regulations. We reviewed 18 regulatory impact assessments relating to the Clean Water Act conducted since 1992. Only five of these studies conducted a quantitative analysis of distributional impacts and none of the 18 rules were determined to have disproportionately adverse effects on low-income or minority communities. Anticipating that future regulatory review will require more comprehensive distributional analyses, we combine national data on the location of all regulated point sources of water pollution with demographic characteristics to develop a baseline assessment of the distribution of water pollution facilities. Overall, we find that discharge locations tend to be located in areas that are poorer, have a higher White population share, and have less education. We find that rurality partly explains this pattern. The top 40% of census block groups in terms of rural population share contain almost all water pollution discharge locations. We conclude with a discussion of the policy implications of these analyses and suggestions for future work. JEL Codes: Q50; Q52; Q53; Q56; Q58