LOS BANOS, CA (September 25, 2025) — On September 5, 2025, a decision by the Ninth Circuit Court of Appeals reaffirmed that agricultural drainage systems carrying irrigation return flows can operate without federal Clean Water Act permits, so long as those systems are not mixed with discharges from outside point sources.
The ruling is particularly significant for farmers in the Grassland Drainage Area west of Los Banos, where thousands of acres of irrigated farmland rely on engineered drains to carry away subsurface water laden with salts and selenium. For decades, that drainage has been managed through the Grassland Bypass Project, which diverts flows away from wetlands and wildlife refuges before sending them to Mud Slough and the San Joaquin River.
Environmental groups had argued that commingled pollutants such as groundwater seepage, dust, or other non-agricultural inputs should remove the exemption and trigger a federal permit requirement. The Ninth Circuit disagreed, finding that Congress specifically exempted irrigation return flows from Clean Water Act permitting and that extending permit requirements to incidental, nonpoint pollutants would make the exemption meaningless.
However, the judges made clear that the exemption does not apply if separate point source discharges such as municipal stormwater outfalls, wastewater effluent, or industrial releases are routed into agricultural drains. In those situations, a federal permit could still be required.
Local impacts for Merced County
For growers around Los Banos and the broader Merced region, the decision provides a measure of certainty at a time when water regulation is often shifting. The Grassland Bypass Project already operates under state Waste Discharge Requirements imposed by the Central Valley Regional Water Quality Control Board, which sets limits on selenium and other pollutants. The new court ruling effectively shields the project, and the farms that depend on it, from an added layer of federal permitting.
“This is an important win for irrigated agriculture in the San Joaquin Valley,” said one Central Valley farm advocate in reaction to the ruling. “Producers still face strict state oversight, but at least they won’t be forced into duplicative federal permits that could slow operations and increase costs.”
Despite the ruling, local agencies and farmers are being cautioned to remain vigilant. If any outside discharges are tied into the Grassland system, even unintentionally, those flows could trigger permit obligations under federal law. Environmental groups also continue to monitor the health of regional wetlands and the Los Banos Wildlife Area, where water quality is closely linked to drainage practices.
Legal observers note that the Supreme Court’s 2020 Maui v. Hawaii Wildlife Fund decision, which held that some indirect discharges may still require permits if they are the “functional equivalent” of direct releases, could play into future litigation over agricultural drains.
For now, the Ninth Circuit’s decision solidifies the long-standing understanding that farm return flows are treated differently under federal law. For Merced County and Los Banos, where agriculture drives the economy and water management shapes the landscape, the ruling offers reassurance, and also a reminder that the balance between farming and environmental protection will remain under the spotlight.
