The Waters of the United States rule is, at its base, nothing more than a clarification of the implementation of the Clean Water Act, passed in 1972 and signed into law by President Richard Nixon. The Act established federal authority to limit pollutants discharged into bodies of water that cross state lines. As initially implemented by the EPA (also created during the Nixon administration), it was applied to large bodies of water like lakes, major rivers, and the ocean. This regulation effectively reduced pollution in lakes, rivers, and the ocean. That led to the realization that pollutants in smaller bodies of water such as streams, wetlands, and ponds were leading to pollution in larger bodies of water (e.g. algae blooms from fertilizer run-off).
The original Clean Water Act statute was not clear about whether, or how much, federal regulatory authority extended to these smaller bodies of water. Beginning in 2011, the EPA launched a massive effort to clarify this issue. The process engaged the Army Corps of Engineers, the scientific community, several hundred stake holder groups, and the general public. As a result, the 2015 Clean Water Rule was enacted. It specified that smaller bodies of water and waterways with connections to the larger bodies of water already protected by the Clean Water Act, were also protected. The simple reasoning was that the health of downstream waters is affected by the health of upstream waters. The Clean Water Rule codifies the somewhat obvious reality that the Waters of the United States are generally all part of one loosely integrated whole, and that ensuring clean water everywhere is necessary to ensure clean water anywhere. The Rule established federal regulatory authority over 2 million miles of streams and 20 million acres of wetlands. When implemented, anyone who wants to discharge pollutants into these smaller bodies of water, or to dredge or dirt-fill them, needs a permit from the EPA.
Not surprisingly, many developers, landowners, farmers, golf course owners, and others are not happy about the Clean Water Rule. They consider it federal overreach that infringes on their property rights, and on the role of the States in implementing the Clean Water Act.
The former Trump Director of the Environmental Protection Agency, Scott Pruitt (who had filed suit against the EPA regarding the Clean Water Rule as Oklahoma Attorney General) sought to stop the scheduled implementation of this expanded regulatory authority. As there was no new legislation involved with the Clean Water Rule (it is simply an implementation of the Clean Water Act), the EPA would have to apply the same rule making process that produced the Clean Water Rule to generate a different rule establishing different (or no) federal regulatory authority over smaller bodies of water.
The legal wrangling going on is all about whether or not the Clean Water Rule must be allowed to proceed into effect while the EPA is attempting to replace it with a different rule, and required basis for the proposed replacement rule. Some jurisdictions have obtained court orders pausing implementation of the Clean Water Rule. The EPA is attempting to establish a new rule without reopening debate on the scientific basis for the Clean Water Rule.