Proposed Changes to Critical Habitat Designations Would Gut Purpose of Economic Analysis

A law alert from our colleague Cherise Oram:

On August 24, 2012, the U.S. Fish and Wildlife Service and the National Marine Fisheries Service (collectively, the "Services") issued a proposed rule that would modify when and how the Services analyze economic impacts in critical habitat designations under the Endangered Species Act ("ESA"). Critical habitat designation is intended to provide special protection of essential habitat for species listed as endangered or threatened under the ESA. The ESA prohibits federal agencies from taking actions that are likely to destroy or adversely modify that critical habitat. Critical habitat designations are often controversial because they may discourage or impair private activities on private lands by requiring federal permits or otherwise devaluing the lands located within a designation.

Before designating critical habitat, the Services are required to consider potential economic, national security, and other relevant impacts. This includes economic impacts to private landowners and developers. The Services may exclude an area from critical habitat if the benefits of excluding it outweigh the benefits of including it in the designation.

The proposed rule seeks to resolve a split among the U.S. federal appeals courts on how to assess economic impacts. The rule would adopt the Ninth Circuit's "baseline approach." That approach allows the Services to consider only the incremental impacts of the designation above those impacts that arguably resulted from the species' listing under the ESA. This incremental impact is often limited to minor additional administrative costs. By minimizing the economic impacts to be considered, this approach arguably results in larger areas being designated as critical habitat. By contrast, the Tenth Circuit has held the "baseline approach" unlawful and, instead, requires the Services to consider the full economic impact of a proposed designation.

The proposed rule would also give the Services "wide discretion" when determining whether to exclude areas from designated critical habitat on the basis of economic impacts. Coupled with the incremental approach, this change would arguably render the ESA requirement for an economic analysis entirely illusory; such unchecked discretion could result in the Services conducting narrow economic analyses, ignoring the results of their economic analyses, or both. In addition, if the decision of whether to exclude habitat is entirely discretionary, it will be difficult for would-be challengers to demonstrate that the Services should have excluded a particular area from critical habitat due to its economic impacts.

Finally, the Services often publish their draft economic analyses for comment when they issue a final critical habitat designation. This has resulted in legitimate criticism that the Services' final designations – particularly their weighing of the benefits of excluding an area against the benefits of designating an area – do not reflect consideration of the public's comments on the economic analysis. The proposed rule would require the Services to issue a draft economic analysis for public comment at the same time the proposed critical habitat designation is published, thus allowing them to consider those comments in preparing a final designation.

Because of the implications of the intended revisions, the effort may affect a range of ESA concerns relevant to a variety of commercial and industrial sectors. The Services are accepting comments on the proposed rule until October 23, 2012.

Stoel Rives has a broad depth of experience covering all aspects of the ESA, including advising on critical habitat issues and assisting clients with preparing and submitting comments on significant regulatory revisions.

If you have any questions about the issues raised in this alert, or other legal matters relating to the ESA, please contact:

Cherise Oram at (206) 386-7622 or cmoram@stoel.com
Jeff Leppo at (206) 386-7641 or jwleppo@stoel.com
Barbara Craig at (503) 294-9166 or bdcraig@stoel.com
Ryan Steen at (206) 386-7610 or rpsteen@stoel.com
Barbara Brenner at (916) 319-4676 or babrenner@stoel.com
Jason Morgan (206) 386-7527 or jtmorgan@stoel.com

Kauai's Electric Utility Faces Civil Suit and Criminal Charges For Bird Fatalities

From our colleagues Greg Corbin and Barbara Craig:

On March 24, 2010, four conservation groups filed a complaint against Kauai’s electric utility, Kauai Island Utility Co-op (“KIUC”), alleging that KIUC’s power lines, utility facilities, and street lights “take” threatened Newell’s Townsend’s shearwaters (Puffinus Auricularis Newelli) (“Newell’s shearwaters”) and/or endangered Hawaiian petrels in violation of the Endangered Species Act (“ESA”). The civil complaint, filed in the U.S. District Court for the District of Hawaii, alleges that KIUC has failed to secure the necessary ESA incidental take permits and, despite years of promises, has failed to implement protective measures that are needed to prevent the “take” of the listed birds.

On May 19, 2010, a federal grand jury indicted KIUC for allegedly taking Newell’s shearwater in violation of the ESA, and for allegedly taking both Newell’s shearwater and Laysan albatross (Diomedea immutabilis) in violation of the Migratory Bird Treaty Act (“MBTA”). According to the indictment, which alleged criminal violations of the ESA and MBTA, KIUC failed to secure the necessary incidental take coverage and to fully mitigate for anticipated takings despite years of negotiations with the U.S. Fish and Wildlife Service to obtain an incidental take permit. The indictment was filed in the U.S. District Court for the District of Hawaii.

These cases illustrate two points relevant to any industry dealing with potential impacts to species protected by the ESA or MBTA. First is that the filing of a citizen suit under the ESA, as occurred here, often raises the profile of a situation and can lead to pressure on the U.S. Fish and Wildlife Service to exercise its independent authorities under the ESA and MBTA. The MBTA does not allow citizen suits, but the filing of a civil ESA citizen suit can lead to criminal charges being brought by the United States under both the ESA and the MBTA. Second, these cases demonstrate that there is a threshold beyond which the United States will invoke its authority to seek criminal indictments under these laws. The allegations in both cases acknowledge that KIUC had engaged in discussions and agreements with the U.S. Fish and Wildlife Service about obtaining permits, but when progress was not made on the agreed to timelines, the United States invoked its most severe authority. This should serve to remind everyone that ignoring risks and liability under the ESA and MBTA can have serious consequences.

Limit Liability Risk By Complying With Recommended Wind Energy Guidelines?

From our colleague Eric Martin:

After over two years of work, the federal Wind Turbine Guidelines Advisory Committee (“Committee”) recently released its final policy recommendations on how wind energy developers and operators can best assess and prevent adverse impacts to wildlife. Comprised of government, environmental, and wind industry stakeholders, the Committee recommends a five-tier approach that begins with the preliminary evaluation of potential wind energy sites and continues through post-construction studies. These consensus recommendations are designed to cover all elements of wind energy facilities—from access roads through transmission line connections. Following Secretary of the Interior Ken Salazar’s review, the U.S. Fish and Wildlife Service (“USFWS”) will use the Committee’s recommendations as the basis for new guidelines replacing the problematic interim guidance that the USFWS had issued back in 2003.

Compliance with the voluntary guidelines could have significant legal benefits for developers and operators. Perhaps most importantly, in the event of death or injury to species protected under the Migratory Bird Treaty Act or the Bald and Golden Eagle Protection Act, the Committee recommends that the USFWS exercise its enforcement discretion by not prosecuting developers and operators that have complied with its recommendations. The Committee has identified the implementation of company- or project-specific Avian and Bat Protection Plans as one way to evidence compliance. This alone, however, would not shield developers and operators from liability for the “take” of species protected by the Endangered Species Act.

The Committee’s recommendations are available here. For more information on these recommendations and their potential effects, please contact:

Greg Corbin at (503) 294-9632 or gdcorbin@stoel.com
Barb Craig at (503) 294-9166 or bdcraig@stoel.com
Eric Martin at (503) 294-9593 or elmartin@stoel.com

 

 

Conservation Advocacy Group Files Lawsuit to Force ESA Decisions on Dozens of Pacific Northwest Species

Last month, the Center for Biological Diversity (CBD) filed a lawsuit in the U.S. District Court for the District of Oregon alleging that the U.S. Fish and Wildlife Service violated the Endangered Species Act (ESA) by failing to take action on a number of listing petitions.

When a listing is petitioned, the Fish and Wildlife Service has 90 days to determine whether action may be warranted and then 12 months to issue it's finding.

The CBD’s lawsuit alleges that the Service has failed to issue 90-day and 12-month findings, for dozens of northwest species in violation of the ESA.

Stoel Rives attorney Ryan Steen issued a law alert exploring the significant implications surrounding these suits and the potential ESA listings.

186 More Species to be Protected by the Migratory Bird Treaty Act (MBTA)

My colleagues Greg Corbin and Eric Martin report on an important development under the Migratory Bird Treaty Act that may affect the siting and permitting of wind projects

Yesterday the U.S. Fish and Wildlife Service (FWS) announced the addition of 186 migratory birds to its list of species protected by the MBTA. Effective at the end of this month, this is the first update to the MBTA list in 25 years and will bring the total number of species receiving federal protection under the MBTA to over 1,000. Because the MBTA protects the vast majority of birds in the country, it covers many species not covered by the Endangered Species Act (ESA) or other laws.

Similar in some respects to the ESA, the MBTA prohibits the “take” (e.g., wounding or killing) of migratory birds. However, unlike the ESA, the MBTA does not have a routine mechanism for permitting incidental take of migratory birds. Accordingly, there is no way to be completely free of legal liability if a wind project results in the take of a migratory bird. Project developers, though, can seek assurances from the FWS that it will exercise its enforcement discretion if the project developer implements measures to protect migratory birds, such those that might be contained in an Avian & Bat Protection Plan. The measures necessary to avoid or mitigate impacts to migratory birds are project specific and always result in some additional cost, whether through changes to project layout and operation, or supplying mitigation funds.

In light of this newly expanded list of species protected by the MBTA, developers and operators of wind project would be well advised to review their strategy for minimizing the risk of prosecution under the MBTA.

The complete list of birds that will be protected by the MBTA is available at http://www.fws.gov/migratorybirds/.

Animal Rights Group Seeks Injunction to Halt Wind Project on ESA Grounds

From our colleague Ryan Steen:

On July 10, 2009, the Animal Welfare Institute and others (”Plaintiffs”) filed a motion for a preliminary injunction to halt construction of the Beech Ridge wind project in Greenbrier County, West Virginia (the “Project”). The Plaintiffs seek the injunction to prevent unavoidable harms that they allege the Project will cause to the Indiana bat, a species listed as endangered under the Endangered Species Act (“ESA”). The Plaintiffs’ injunction request follows closely on the heels of the complaint the Plaintiffs filed in the Federal District Court for the District of Maryland (Civ. No. 09-1519), which alleges that the Project will unlawfully “take” Indiana bats in violation of Section 9 of the ESA. In their complaint and request for an injunction, the Plaintiffs assert that the Project cannot lawfully move forward without an incidental take permit (“ITP”) issued under Section 10 of the ESA. Judge Titus recently ordered that the hearing on the Plaintiffs’ motion for a preliminary injunction will be addressed in conjunction with the trial on the merits of the case, currently scheduled for October 2009.

Section 9 of the ESA makes it unlawful to “take” (intentionally or incidentally) an endangered species. Under the ESA, “take” means to “harass, harm, pursue, hunt, shoot,
wound, kill, trap, capture, or collect [a listed species], or to attempt to engage in any such conduct.” The incidental take of an endangered species can be authorized under the ESA in two ways: (1) through an “incidental take statement” (“ITS”) issued via a Section 7 consultation, or (2) through an ITP issued under Section 10.

Section 7 of the ESA requires federal action agencies to consult with either the United States Fish and Wildlife Service (“FWS”) or the National Marine Fisheries Service to ensure that “federal actions” are not likely to jeopardize protected species or adversely affect the critical habitat of those species. Typically, a “federal action” is an action that requires a federal permit, but it may also include actions that receive federal funding and are subject to a certain level of federal control. A Section 7 consultation normally results in the issuance of a biological opinion. The biological opinion may include an ITS, which authorizes the permittee to incidentally take a specified number of listed animals.

Alternatively, a project proponent may obtain incidental take authorization through the issuance of an ITP under Section 10 of the ESA. Section 10 provides an exception to Section 9’s take prohibition, in which an applicant can apply for a permit authorizing a take if such taking is “incidental to, and not the purpose of, carrying out an otherwise lawful activity.” A project need not have a “federal nexus” to receive Section 10 take authorization. Significantly, an ITP must be accompanied by a habitat conservation plan (“HCP”) that is completed by the permit applicant and approved by FWS. The process for developing and completing an HCP can be time consuming and, as a general matter, project proponents opt for the issuance of an ITS under Section 7 instead of engaging in the Section 10 process.

Like many wind projects, the Beech Ridge project required no federal permits and does not have a federal nexus. Thus, any incidental take caused by the project would need to be authorized by a Section 10 permit to avoid a violation of the ESA. In the lawsuit, the Plaintiffs seek to require the project proponents to obtain the Section 10 ITP before engaging in any further development of the project. The Plaintiffs have taken the more urgent step of requesting a preliminary injunction because, as alleged by the Plaintiffs, the Defendants “have proceeded with construction activities at a precipitous pace, despite plaintiffs’ repeated and detailed notice prior to construction that these activities constitute violations of the ESA.” The Defendants generally deny the Plaintiffs claims and assert that pre-project studies demonstrate that no Indiana bats occupy the areas in or near the Project’s location.

Wind project proponents may face similar challenges for projects sited in or near areas occupied by a species listed under the ESA. For projects that may incidentally take listed species, project proponents may be faced with the option of obtaining an ITP under Section 10 of the ESA or obtaining an ITS through a Section 7 consultation. As indicated above, the latter is generally a more efficient process; however, many wind projects have no federal nexus and thus no Section 7 “trigger.” Project proponents should carefully examine their project to determine whether or not there is, in fact, a Section 7 trigger. If not, the project proponent should consider other options such as negotiating a Section 10 HCP/ITP process with the FWS that allows the project to move forward in a timely fashion or incorporating the use of Avian and Bat Protection Plans.