"Section 401 of the Clean Water Act (CWA) requires that an applicant for a federal license or permit provide a certification that any discharges from the facility will comply with the act, including state-established water quality standard requirements. Disputes have arisen over the states' exercise of this authority in protecting water quality. For the most part, the debate over the Section 401 certification issue has been between states and hydropower interests. A 1994 Supreme Court decision, which upheld the states' authority in this area, dismayed development and hydropower interest groups. The Court revisited these issues in a 2006 ruling that unanimously upheld the authority of states to condition hydropower licenses by exercising Section 401. The dispute between states and industry groups about Section 401 authority has been a legislative issue on several occasions, but Congress has not modified the provision's scope. In the 114th Congress, Senate and House committees are considering a number of energy policy proposals, including legislation that some states believe could impinge on states' authority under CWA Section 401 concerning hydropower projects. In addition, there has been interest in clarifying whether Section 401 certification applies to nonpoint source discharges, such as rainfall runoff, as well as point source discharges from pipes or ditches. This question was raised in lawsuits in Oregon, where a federal court ruled in 1998 and again in 2008 that Section 401 does not apply to nonpoint source discharges. Still, some interests continue to favor a broad reading of 401 that would apply to both nonpoint and point sources of pollutant discharges."
CRS Report for Congress, 97-488
National Agricultural Law Center: http://nationalaglawcenter.org/