Amicus Curiae Brief — Environmental Protection Agency v. Defenders of Wildlife

OR Nos. 06-340 and 06-549

IN THe

Supreme Court of the United States

NATIONAL ASSOCIATION OF HOME BUILDERS. ef al.

Petitioners.

Y.

DELENDERS OF WILDLIPE. ef al.

Respondents.

UNTTED STATES ENVIRONMENTAL PROTECTION AGENCY,

Petitioner.

Vv.

DEFENDERS OF WILDLIFE. e7 al.

Respondents.

On Writ of Certiorari to the

United States Court of Appeals

for the Ninth Circuit

BRIEF OF AMICI CURIAE

AMERICAN BIRD CONSERVANCY,

ENVIRONMENTAL DEFENSE,

NATIONAL AUDUBON SOCIETY,

NATURAL RESOURCES DEFENSE COUNCIL,

SIERRA CLUB, THE WILDERNESS SOCIETY,

AND WORLD WILDLIFE FUND

IN SUPPORT OF RESPONDENTS

MICHAL. J. BEAN

COUNSEL OF RECORD

ENVIRONMENTAL DEEENSI

IS7S CONNECTICUT AVE NW

Sturre 600

WASHINGTON, D.C. 20009

(202) 387-3500

NlvrciH 27, 2007

TABLE OF CONTENTS

Page

I ili

INTERESTS OF AMICI CURIAE ............cccccccccccscsssseccsessseess ]

SUMMARY OF ARGUMENT...............cccccccccccscscsssosssssseecees 3

RE DEE SENN en Oe OC Ree OE 4

I. THE PLAIN MEANING OF SECTION

7(a)(2) ENCOMPASSES EPA’S ACTION ............. 4

A. Section 7(a)(2) Focuses Not Merely On

Decisions To Act, But On How Those

Be i crtincnniienitiiniitadiintinnnainnann 4

B. The Reach Of Section 7(a)(2) Is Not

Circumscribed by Decisions Limiting

EIR a am 7

II. THE REFERENCE IN THE

REGULATIONS TO

“DISCRETIONAR Y FEDERAL

INVOLVEMENT OR CONTROL”

DISTINGUISHES COMPLETED

ACTION FROM ONGOING ACTIONG................ 9

A. History Of The Regulations.................c::ceeeeeees 9

B. Subsequent Interpretation By The

ela ial i ad 13

Ill. EPA’S CONTENTION IS

INCONSISTENT WITH THE PURPOSES

OF SECTION 7(a)(2) AND THE

CENTRAL ROLE OF THE

INTERAGENCY CONSULTATION

PROCESS IN RESOLVING APPARENT

ee sinnncvssccntneniiauniibvensciineimnindntnapbnnesecnadiiiesann 16

A. The Purposes Of The ESA Would Be

Frustrated By EPA’s Contention .................0... 16

B. EPA’s Position Undermines the Pivotal

Role That Congress Intended The

Interagency Consultation Process To

Play In Resolving Seeming Conflicts ............... 19

1. The Role of the consultation process

Is not simply to identify potential

Conflicts, but to seek out ways to

Avoid them, which it has largely

en 19

2. EPA’s position ignores the

Authorities it has that could reduce

the likelihood of prohibited impacts........... 24

3. Ifa truly irresolvable conflict exists,

The exemption process is the

Required means of addressing it.............. 26

IV. EPA’S CONTENTION THAT NON-

DISCRETIONARY FEDERAL ACTIONS

ARE NOT SUBJECT TO SECTION 7(a)(2)

WOULD HAVE UNANTICIPATED

NEGATIVE CONSEQUENCES FOR

Pe STEAD conccvcccccsssnseenssseseeuscsneeneenniee 27

ST eectiiesenepelheneniseisisieniaiidinevinidncnnnsanrineantin —

TABLE OF AUTHORITIES

CASES

Page(s)

American Forest & Paper Ass'n v. United States EPA,

137 F.3d 291 (S™ Cir. 1998).........scssceseesesesseesees 21,22,23,26

Babbitt v. Sweet Home Chapter of Communities for a

Great Oregon, 515 U.S. 687 (1995) ...........cccssseceecsssereeesenees 28

Baltimore Gas and Electric Co. v. Natural Resources

Defense Council, 462 U.S. 87 (1983) .........cccccceeseseeeceneeeeees 7

Bennett v. Spear, 520 U.S. 154 (1997).......cssssccssserecceesssreceseees 28

Department of Transportation v. Public Citizen, 531 U.S.

Pe ee iiciccscnitinsniintinnsiceceubinnnasiadiinninineapeeninincninitcs 7,8,24

Hill v. TVA, 419 F.Supp. 753 (E.D. Tenn. 1976)..............ceeeeceees 10

Hill v. TVA, 549 F.2d 1064 (6" Cir, 1977) ...secsesesseseseseeees 8,10,11

Platte River Whooping Crane Critical Habitat Maint.

Trust v. FERC, 962 F.2d 27 (D.C.Cir. 1992) ........-..00008 14,15

Fg nee 6,8,19,26

STATUTES

Endangered Species Act

eae SED atspiicinstnnnsinntinndinnnnciipesennidicunssininnmninnaiiite 16

iiss SEITE sainsistiseisonstesnntinicedsinnussepshinnaniaiesenatinsnitions 16

Beis Sane U III icciinichoninscinasiinninipnscncenindiamtinnnsensnineetennicuntinn 48

eens IIIT sesiisinseckceseensctiionnnesibnanioseemnmaiesppanenindeaminssiidiiin 18

Be eis SEED ssitciscnicsicitniensnnnestinniiinnsideinnipsienteiisisinitin 168,28

aie SD csinicsccceniininaninneineniensetanisasunarinienncetiie 18

iV

BP reais SE viiniphicnsccndenictmeenssninecsiniiaeietsiniddbiatiiniiiii 16

a Saale: A Asiinstcdcinictibieseensnsanienindasicetsiilineiiieies 16,24

_ ) A SST Ee Es 3, passim

EE: aN 19

Sp eee I ee cnsiisssehneniicssnicsaseineresanmesendiiiaitbened REE

BOF eee SPIE covencesurcnincsecneresecnnnenmnnecnniteildiieiveniesnstt 20

Pe SEE wiesesnvensinscsentunnsmnnetecinetssbtiulilipenieienig 17,27

BD Ce PUMP RUUDED sncvnsivacvnssnstsessectiilipeipmnndetaesien 27

SAF ee SINE sncttsccscetiesitectesinntsovencniniienniiantaliinasareniiiets 17

BP ta Sp erisccsiistecenidateiinnseneneiiedsiiilapsiennitis 28,29

ID ticcisicnivnncncnsivsnennciesemminetiisdamuiciamampiniti 17

ae Ses STI cpsinsiceipenssnniaeeiseneciiniseienidnanietataiilatiantiasiniaie 17

4 ETE eM o 17,28

= Ei eas SID secevecniccnssecosinstesendniibilinnsnamneladeiitivis 17

a SN 17,29,30

Clean Water Act

Fs See nsnsncevininanicaiinieniannaicensinigialbianiansiiaiunni 22

a Na TUITE sexseteintesinhceecicisdsheenisininenstchianianddiietilsiiibimeanianeiiininete 5

a See I isikisaissesihcsiesssctcebasilseeashdaiieisaiiatia 22

Fe ps ID cesccnicicticsiccsercihicentinsaiacnienniilbieesineitiaiiteantiiis 25

Fe es ee ovdistncidstincsiatniiisisiitinnianpiesiihaiadidliabiiaitaeninaiat 25

National Environmental Policy Act

nee 3,7,8,11

Vv

REGULATIONS

50 C.F.R

Section 402.01 .............. 1 cconcenisiatnennqtiieidensineisiaaeeiaiinianannnl 13

I GI ccccccersesrsceensnseviniiniiaieinimmmlaaala 13,25

INTE GID cccsccececessoscsesnssenenenenseisesstiiniaeaaina 9,11

ae Ba csc ceveccovsscsssvssecssniscssiiemaniamamanee 20

eI SOG cncenscrrsneseccnsesssscionsniensciemimmaal 20

OCTIG TE GTI cccneccessseceesconcnenensuaneneiinnsiinenneniaaaanaaaa 27

SOCeR SEDI TID wceceecevsvcesscccnssansisncuenuiessbonaanitn 27

AGENCY RULE MAKING

42 Federal Register 4868 et seq. (Jan. 26, 1977) .........:0000e 10

43 Federal Register 869 et seg. (Jan. 4, 1978) ...........+ passim

48 Federal Register 29990 et seg. (June. 29, 1983) ............. 12

51 Federal Register 19926 et seg. (June 3, 1986) ........... 12,13

ARTICLES

Terry Rabot, The Federal Role in Habitat

Protection, Endangered Species Bulletin, vol.

26, no. 6 at 10-11 (Nov./Dec. 1999),

www.fws.gov/endangered/esb/99/1 1-12/10

0B aT .wn+<cseosscsonsounnnneesnnatnapsinnintendiianiiamiaaalana 21

BOOKS

American Heritage Dictionary, 4" edition (2001) ..........0.0++. 6

Merriam Webster Pocket Dictionary (1994) oo... eee 6

Michael Bean The Evolution of National Wildlife

bane OF? 6b, WED eccinisucicinninstnisniiiiae cue Oe

vi

Michael Bean & Melanie Rowland The Evolution of

National Wildlife Law (31rd ed. 1997) ........:...:cccccceeeeeeeees 19

Webster’s Third New International Dictionary

Sri ienticalitindahdenashiadiinimisinitiadneninteenitesetesonmsetestanemenemens 6

MISCELLANEOUS

Consultation Handbook: Procedures for

Conducting Consultation and Conference

Activities Under Section 7 of the Endangered

Species Act available at

www.fws.gov/endangered/consultations/s7hndb

I icnniiendiasiecbidiiiiietinendaminteneniensteneunneniees 13,14,15

Guidelines to Assist Federal Agencies in

Complying with Section 7 of the Endangered

Species Act of 1973 (April

te EE a en dhentnainnennnenoiee 9

Habitat Conservation Planning Handbook,

available at

www.fws.gov/endangered/hcp/hcpbook.htm..............6. 29

ee Ss Py CE ccccicccsccencnncasencnepessssconesisoste 21,29

124 Cong. Rec. $10896 (daily ed. July 17 1978) ............. 27

128 Cong. Rec. 12958 (June 8, 1982) .................cccccceseseeeeees 21

128 Cong. Rec. 26188 (Sept. 30, 1982) ...cccc.cccscssssssesseveeeve 29

INTERESTS OF AMICI CURIAE'

Amicus Environmental Defense is a _ non-profit

organization that represents over 500,000 members. Since

1967, Environmental Defense has linked science, economics,

law, and private-sector partnerships to create solutions to

many of the most serious environmental problems.

Amicus American Bird Conservancy (“ABC”) is a U.S

non-profit organization dedicated to the conservation of

native wild birds and their habitats throughout the Americas.

ABC works in partnership with a wide range of stakeholders

from indigenous communities and private landowners, to

corporations, government agencies, and other NGOs. ABC

is incorporated in Delaware with over 7,000 members.

Amicus National Audubon Society, Inc. is a non-

profit corporation organized under the laws of the State of

New York, with its principal office at 700 Broadway, New

York, New York 10003. National Audubon has more than

367,000 members, offices in 23 states, and a presence in all

50 states through more than 450 certified chapters and

through its nature centers, sanctuaries, and education and

science programs. Audubon’s mission is to conserve and

restore natural ecosystems, focusing on birds, other wildlife,

and their habitats for the benefit of humanity and the earth’s

biological] diversity.

' This brief was not authored in whole or in part by counse! for a party,

and no person or entity other than amici curiae, their members, and their

counsel, made a monetary contribution to the preparation and submission

of this brief. All parties have consented to the filing of this brief. All

parties other than the United States submitted letters to the Court

consenting to the filing of all amicus curiae briefs. The consent of the

United States has been filed with the clerk.

Amicus Natural Resources Defense

Council (“NRDC”) is a non-profit conservation organization

incorporated under the laws of New York State. NRDC

represents over 525,000 members nationwide, over 10,000 of

whom live in Arizona. Through its litigation, scientific, and

advocacy efforts, NRDC has long been active in efforts to

protect endangered species, restore integrity to the earth's”

resources and establish sustainability and good stewardship

of the earth.

Amicus Sierra Club is a non-profit corporation

organized under California law, with more than 700,000

members in the United States. Sierra Club is dedicated to

exploring, enjoying, and protecting the wild places of the

Earth; to practicing and promoting the responsible use of

the Earth's resources and ecosystems; to educating and

enlisting humanity to protect and restore the quality of the

natural and human environment; and to using all] lawful

means to carry out these objectives.

Amicus The Wilderness Society is a non-profit public

interest membership organization headquartered in

Washington, D.C. Founded in 1935, the Society and its

approximately 250,000 members and supporters are

dedicated to protecting a national network of wild lands and

fostering an American land ethic. The Society works to

ensure wise management and protection of America's public

lands and the wildlife therein. The Society fulfills its mission

through public education, analysis, and advocacy.

Amicus World Wildlife Fund (“WWF”) has been

protecting the future of nature for over 45 years. The largest

multinational conservation organization in the world, WWF

_works in 100 countries and is supported by 1.2 million

members in the United States and close to 5 million globally.

WWF's unique way of working combines global reach with a

foundation in science, involves action at every level from

local to global, and ensures the delivery of innovative

solutions that meet the needs of both people and nature.

3

Amici curiae and their members and supporters highly

value rare wild plants and animals for their aesthetic,

ecological, educational, historical, recreational, scientific,

utilitarian, and other values. They have a special interest in

the effective administration of Section 7 of the Endangered

Species Act because of its important role in fostering efforts

to reconcile the survival imperatives of rare species with

other societal objectives.

SUMMARY OF ARGUMENT

In this case, the government contends that, in carrying

out an action it characterizes as non-discretionary pursuant to

a Statute that was enacted prior to the Endangered Species

Act (“ESA”), and that, not surprisingly, makes no mention of

endangered species, a federal agency may disregard a

requirement of the subsequently enacted ESA that, on its

face; applies to “any action authorized, funded, or carried out

by” a federal agency. That broad contention cannot be

reconciled with either the plain language or the purpose of

Section 7(a)(2) of the ESA, 16 U.S.C. §1536(a)(2). The

plain language of Section 7(a)(2) applies to all actions

“carried out” by federal agencies and requires such agencies

to explore every available means of reducing the likelihood

that such action will have_a prohibited effect. Because the

focus of Section 7(a)(2) encompasses the execution of

actions, as well as the decisions to undertake those actions,

and because the mandate of Section 7(a)(2) is both

procedural and substantive, principles applicable to the

interpretation of the National Environmental Policy Act

(“NEPA”) do not limit the application of Section 7(a)(2).

The government's contention would, moreover,

frustrate the purposes of the ESA and render nugatory the

interagency consultation process that Congress has

repeatedly declared to be the intended — and largely

successful — means of resolving apparent conflicts between

the ESA’s conservation goals and the objectives of other

4

laws. In doing so, it would foreclose the required careful

consideration of all measures within the authority of the

Environmental Protection Agency (“EPA”) that could reduce

the likelihood of a prohibited effect. Further, the

government’s contention improperly bypasses the Section 7

exemption process that Congress crafted to address the

occasional, truly irresolvable conflicts between species

survival imperatives and other agency responsibilities.

Although ESA implementing regulations limit the

applicability of Section 7(a)(2) to federal actions in which

there is “discretionary Federal involvement or control,”

consideration of their history compels the conclusion that

they were intended to distinguish completed federal actions

from actions over which a federal agency has ongoing, yet-

to-be completed responsibilities. Finally, the government’s

broad contention, if accepted by the Court, would lead to

problematic consequences whereby agencies carrying out

putatively “non-discretionary” actions would be unable to

secure relief from the prohibition against incidentally taking

endangered species — relief readily available for other federal

actions and for private and other non-federal actions.

ARGUMENT

I. THE PLAIN MEANING OF SECTION 7(a)(2)

ENCOMPASSES EPA’S ACTION

A. Section 7(a)(2) Focuses Not Merely On

Decisions To Act, But On How Those

Actions Are Carried Out.

Section 7(a)(2) of the ESA requires “each federal

agency” in consultation with the U.S. Fish and Wildlife

5

Service or National Marine Fisheries Service,” to “insure that

any action authorized, funded, or carried out” by it “is not

likely to jeopardize the continued existence of any

endangered or threatened species or result in the destruction

or adverse modification” of the critical habitat of any such

species. EPA contends that this requirement does not apply

to its transfer to a state of the authority to implement the

National Pollutant Discharge Elimination System

(“NPDES”) permitting program in that state pursuant to

Section 402 of the Clean Water Act (“CWA”), 33 U.S.C.

§1342.° More broadly, EPA contends that Section 7(a)(2)

does not apply to any “non-discretionary” federal action.

Even assuming arguendo that EPA’s action here is non-

discretionary, its contention is contrary to the plain meaning

> The National Marine Fisheries Service is primarily responsible under

the ESA for marine and anadromous species; the U.S. Fish and Wildlife

Service is primarily responsible for all other species. Unless the context

requires reference to a particular agency, they will hereinafter be referred

to collectively as “the Service” or “the Services.”

* In prior proceedings in this case regarding the transfer to Arizona, as

well as when considering similar transfers to other states, EPA and the

Service have taken the position that Section 7(a)(2) applies.

Notwithstanding those earlier positions, EPA now maintains categorically

that “there is no need to conduct Section 7 consultations on proposed

actions to approve State NPDES programs because such actions are not

the cause of any impact on listed species and do not constitute

discretionary federal agency actions to which Section 7 applies.” Brief

for Petitioner EPA (“EPA Br.”) at 49 (quoting the Fish and Wildlife

Service). This “clarification” of EPA’s position took place after the

decision of the Cour: of Appeals in this case, and occurred in the context

of a transfer of NPDES authority to Alaska, the only state without a

single freshwater endangered or threatened species. See

http://ecos.fws.gov/tess_public/StateListing.do?state=all (visited March

18, 2007). In light of this irregular procedure and for reasons set forth at

length in Respondents’ brief, EPA’s decision should be remanded for

further proceedings consistent with the requirements of Section 7(a){2). =

6

of Section 7(a)(2) and misapprehends the focus of that

provision.

The focus of Section 7(a)(2) is on “actions” and their

implementation. It plainly seeks to influence how actions are

“carried out” by federal agencies, and not simply the process

by which decisions to act are made. EPA asserts that

whenever a federal agency merely carries out a decision

required by the terms of another statute, it is Congress that is

responsible for the ensuing effects, not the agency. However,

Section 7(a)(2) is clear on its face that it applies to any action

“carried out” by a federal agency, even when that action is

pursuant to a statute, like the Clean Water Act, that was

enacted prior to the ESA and, not surprisingly, makes no

explicit mention of endangered species.

Rather than imply a limitation to actions over which

an agency has discretion, the ordinary meaning of the phrase

“carried out” connotes a much broader reach. “Carry out”

means “to put into execution” (Webster’s Third New

International Dictionary, 1966), “to bring to a successful

conclusion” (Merriam Webster Pocket Dictionary, 1994), or

“to follow or obey” (American Heritage Dictionary, 4" ed.

2001). A soldier, for example, “carries out” the order of an

officer, though the soldier's action can hardly be

characterized as discretionary. By the same token, an agency

whose action simply effectuates a decision according to

specified criteria nevertheless “carries out” that action. Thus,

when EPA transfers NPDES authority to a state, it “carries

out” an action clearly subject to Section 7(a)(2). This Court

in TVA v. Hill, 437 U.S. 153, 186 n. 32 (1978) characterized

its holding as “giv{ing] effect to the plain words of the

statute, namely that §7 affects all projects which remain to be

authorized, funded, or carried out.” The plain meaning of

Section 7 is no less clear today.

7

B. The Reach Of Section 7(a)(2) Is Not

Circumscribed By Decisions Limiting the

Reach of NEPA

Because Section 7(a)(2)’s primary focus in on how

agency actions are carried out, it is fundamentally different

from the National Environmental Policy Act (“NEPA”).

NEPA requires an environmental impact statement to

accompany “every recommendation or report on proposals

for legislation and other major Federal actions significantly

affecting the quality of the human environment.” 42 U.S.C.

§4332(2)(C). NEPA’s focus is on the decision-making

process of federal agencies. See Baltimore Gas and Electric |

Co. v. Natural Resources Defense Council, 462 U.S. 87, 100

(1983) (NEPA requires a hard look at environmental effects

and “that the ‘hard look’ be incorporated as part of the

agency’s process of deciding whether to pursue a particular

federal action”) (emphasis added). Section 7(a)(2) of the

ESA, in contrast, reaches well beyond the “process of

deciding whether to pursue” an action to the matter of how to

implement that action (the “carrying out” of the action). It

requires that in carrying cut any action, a federal agency

“insure” that it is unlikely to have any of the effects

proscribed there.

This critica] difference between the focus of Section

7(a)(2) and that of NEPA distinguishes this case from

Department of Transportation y. Public Citizen, 531 U.S.

752 (2004). In Public Citizen the Court held that it was the

President’s decision to allow Mexican trucks to operate in the

United States - not the Federal Motor Carrier Safety

Administration’s (““FMCSA”) carrying out of one aspect of

that decision — that, for NEPA’s purposes, was most

important. As a result, the Court in Public Citizen reasoned

that no purpose would be served by requiring the FMCSA to

assess the environmental impact of a decision that the

President had already made. Unlike NEPA, which governs

only the decision-making process, the duty to “insure”

8

imposed by Section 7(a)(2) clearly rests with the agency that

“carries out” an action, and seeks to influence how that

action is carried out, not just how it is decided upon.*

Moreover, the Services themselves explicitly rejected

NEPA-derived limitations on the scope of Section 7 only

months before this Court decided TVA v. Hill. In January

1978, they jointly promulgated regulations in which the only

issue regarding the reach of Section 7 concerned its

application to previously initiated, nearly completed federal

actions. 43 Fed. Reg. 869 et seg. (Jan. 4, 1978). The

Services expressly followed the decision of the Sixth Circuit

in Hill v. TVA, 549 F.2d 1064, 1071-72 (1977), and rejected

“the incorporation of the NEPA case law into the section 7

regulations.” 43 Fed. Reg. at 872. Their rejection of NEPA

precedent as controlling Section 7 was effectively endorsed

by this Court in TVA v. Hill, in which Chief Justice Burger

found that NEPA decisions “are completely inapposite,”

because NEPA and the ESA “serve different purposes,” with

NEPA’s requirements being essentially procedural whereas

Section 7’s are substantive. 437 U.S. 153, 188 n. 34. The

Services’ regulations remained in effect when Congress

amended the ESA in 1978, 1979, and again in 1982.

Keenly aware of this Court’s conclusion that

“Congress has spoken in the plainest of words, making it

abundantly clear that the balance has been struck in favor of

affording endangered species the highest of priorities,” 437

U.S. at 194, Congress took no action to limit the reach of

ss Moreover, Public Citizen did not hold that NEPA was inapplicable to

the actions of the Federal Motor Carrier Safety Administration, but only

that the effects of those actions were not substantial enough to trigger the

preparation of an environmental impact statement. By contrast, here the

government argues that EPA’s delegation decision — and every other

putatively “non-discretionary” federal action - lies wholly outside the

reach of Section 7(a)(2). Nothing in Public Citizen warrants that

extension of its holding. _

9

Section 7. Instead, its response in 1978 was to fashion a

special process through which federal actions could be

exempted from the requirements of Section 7 after they had

undergone interagency consultation and been found to

conflict with those requirements. Nothing Congress said or

did when amending the ESA in 1978, 1979, or 1982, when

its attention was squarely focused on Section 7’s duty to

“insure,” suggests that it had any different view of the scope

of that duty than the very one reflected in the 1978

regulations.

Il. ©THE REFERENCE IN THE REGULATIONS TO

“DISCRETIONARY FEDERAL

INVOLVEMENT OR CONTROL”

DISTINGUISHES COMPLETED ACTIONS

FROM ONGOING ACTIONS

A. History Of The Regulations

EPA relies heavily upon a Service regulation stating that

Section 7 applies “to all actions in which there is

discretionary Federal involvement or control.” 50 C.F.R.

$402.03. That reliance is misplaced, for the history of the

regulation shows that its only purpose was to distinguish

completed from ongoing federal actions.

The question of Section 7’s application to actions

already under way when a species was listed arose soon after

the ESA’s enactment. It was at the core of the suit filed in

1976 to halt TVA’s construction of Tellico Dam, which had

been authorized by Congress a decade earlier and was

estimated by TVA to be 70 to 80 percent complete when a

recently discovered fish was listed in 1975. At the time,

there were no regulations interpreting Section 7. Rather, the

U.S. Fish and Wildlife Service on April 22, 1976,

promulgated non-regulatory “Guidelines to Assist Federal

Agencies in Complying with Section 7 of the Endangered

Species Act of 1973.” They advised that when

10

“considering whether section 7 applies to

actions in the ... implementation stage ...

Federal agencies should determine if ...

substantial work remains to be done which

would, independent of the effect of earlier

work performed, in and of itself jeopardize the

continued existence of a listed species or

modify or destroy critical habitat of a listed

species. If ... such work on a Federal project

remains to be performed, then the

requirements of section 7 should be

satisfied.”

Weeks later, the district court decided Hill v. TVA,

419 F.Supp. 753 (E.D. Tenn. 1976). TWA had argued that it

had no discretion to do anything other than complete the

dam, “point{ing] out ... that the money appropriated to it was

for the Tellico Project alone and that it had no authority to

use the funds other than for that purpose.” /d. at 760, n. 8.

The court refused to enjoin completion of the dam, because

“[aJt some point in time a federal project becomes so near

completion and so incapable of modification that a court of

equity should not apply a statute enacted long after inception

of the project to produce an unreasonable result.” /d. at 760.

Like the guidelines they replaced, the first regulations

proposed to implement Section 7 applied it to all federal

actions except those for which there was no “substantial

work” remaining that would independently jeopardize the

continued existence of a listed species. 42 Fed. Reg. 4868 et

seq. (Jan. 26, 1977). Shortly after they were proposed, the

Sixth Circuit rejected any exemption for previously initiated,

nearly completed projects. Hill v. TVA, 549 F.2d 1964 (6"

Cir. 1977). Before the Sixth Circuit, “TVA claimfed] to

> The 1976 guidelines were never published. The quotation here is taken

from Hill v. TVA, 419 F.Supp. 753, 761 (E.D. Tenn. 1976).

1]

have done everything possible to save the snail darter, short

of abandoning work on the dam,” which it asserted was

“innately unreasonable.” Jd. at 1074. Relying upon NEPA

decisions, TVA argued that “the terminal phases of ongoing

projects” should not be considered “actions” subject to

Section 7. /d. at 1070. Expressly rejecting the “NEPA cases

which waive compliance based upon advanced project

construction,” the Sixth Circuit held that “continued work,

directed toward impoundment, violates” Section 7. 549 F.2d

at 1072.

The Services’ final regulations in 1978 provided that

“Section 7 applies to all activities or programs where Federal

involvement or control remains which in itself could

jeopardize the continued existence of a listed species or

modify or destroy its critical habitat.” 50 C.F.R. $402.03, as

set forth at 43 Fed. Reg. 869, 875 (Jan. 4, 1978). The final

regulation was identical to those proposed a year earlier, but

the Services made clear that they too now rejected NEPA

analogies in determining Section 7’s reach:

“It was originally believed that retroactive

situations under NEPA and the Act were

analogous enough to warrant the incorporation

of the NEPA case law into the Section 7

regulations.”

“The Sixth Circuit Court of Appeals in the

recent case of Hill v. TVA ... specifically

considered this analogy and rejected it.

The Court noted that as long as some Federal

discretionary contro] or involvement remained

that could avoid jeopardizing the listed

species or adversely modifying or destroying

its critical habitat, the degree of completion of

a project was irrelevant. In light of the Sixth

Circuit Court of Appeal’s analysis, therefore,

the FWS and NMFS now reject the analysis of

retroactivity in the proposed rulemaking’s

12

preamble and adopt the rationale of the Sixth

Circuit.”

43 Fed. Reg. at 872.

In 1983, the Services proposed an overhaul of their

regulations implementing Section 7. 48 Fed. Reg. 29990 et

seq. (June 29, 1983). Proposed §403.03 said: “Section 7 and

the requirements of this Part apply to all actions in which

there is Federal involvement or control.” Like both the 1978

regulations and the 1976 guidelines, the proposed regulations

drew no distinction between “discretionary” and “non-

discretionary” actions. Nor did the proposed definition of

“action,” which included “all activities of any kind

authorized, funded, or carried out, in whole or in part, by

Federal agencies.” See proposed §402.2, 48 Fed. Reg. at

29998. Thus, proposed §402.3 reaffirmed the longstanding

view of the Services that — apart from completed actions —

Section 7 applied without qualification or limitation to all

federal actions.

The rulemaking initiated in 1983 yielded final

regulations in 1986. 51 Fed. Reg. 19926 et seq. (June 3,

1986). Those regulations renumbered proposed §402.3 as

$402.03 and inserted the word “discretionary” immediately

before the phrase “Federal involvement or control.”. Given

that the proposed regulations, the 1978 final regulations, and

the 1976 guidelines had not limited Section 7’s applicability

to actions in which there was “discretionary” federal

involvement or control, one would have expected the

Services to explain the intention behind the addition of this

word, particularly if it was meant to effect a limitation

beyond the established limitation covering completed

actions. However, the Services said nothing on the matter.

Instead, the entirety of the explanation offered for §402.03

was as follows:

“This section, which explains the applicability

of section 7, implicitly covers Federal

13

activities within the territorial jurisdiction of

the United States and upon the high seas as a

result of the definition of ‘action’ in §402.02.

The explanation for the scope of the term

‘action’ is provided in the discussion under

$402.01 above.”

51 Fed. Reg. at 19937 This explanation addressed the quite

different issue of the extraterritorial application of Section 7,

and specifically it sought to make clear that the term “action”

in §402.03 was limited to actions occurring in the territorial

United States or on the high seas. Accordingly, it is far more

plausible that the final regulations adopted in 1986 intended

no departure from the settled understanding that Section

a)(2) applies broadly to all yet-to-be completed federal

actions, than that the Services intended a wholly new class of

exempt activities for which they offered not a word of

explanation.

B. Subsequent Interpretation By The Services

The conclusion from the foregoing history is consistent

with how the Services appear to understand their own

regulation in their jointly published Consultation Handbook:

Procedures for Conducting Consultation and Conference

Activities Under Section 7 of the Endangered Species Act.©

With only two possible exceptions, whenever reference is

made in the Handbook to “discretionary” federal actions, the

context clearly applies to previously initiated, not yet

completed, actions.

. www.fws.gov/endangered/consultations/s7hndbk/s7hndbk.htm (visited

March 22, 2007).

” See, e.g., Handbook, page 2-15 (“water projects that predate the Act are

subject to consultation if the agency retains any discretion in continuing

project operations”); page 4-28 (discussing the types of analyses required

14

- The only two occasions where the Handbook refers to

“discretionary” federal actions more broadly provide little

support for EPA’s position here. In fact, the first reference

appears to contradict that position:

“The Act requires action agencies to consult

or confer with the Services when there is

discretionary Federal involvement or control

over the action, whether apparent (issuance of

a new Federal permit), or Jess direct (State

operation of a program that retains Federal

oversight, such as the National Pollution

Discharge Elimination System Program).”

Handbook at 2-6. Rather than support EPA’s position, this

appears to say that “state operation” of the NPDES program,

subject to retained federal oversight, is an action on which

consultation is required. The other reference memorializes

the Services’ understanding of the holding in Platte River

Whooping Crane Critical Habitat Maint. Trust v. FERC, 962

F.2d 27 (D.C.Cir. 1992):

for “ongoing discretionary operations of Bureau [of Reclamation] and

Corps of Engineers water facilities”); pp. 4-60, B-12, and B-32

(discussing requirement to reinitiate consultation on an ongoing project

“where discretionary Federal agency involvement or control over the

action has been retained (or is authorized by law)”’); pp. 6-5, B-16, and B-

25 (discussing requirement to initiate formal consultation on action that

was the subject of “conferencing” regarding a species that had been

proposed for listing if, “prior to the completion of the action or while [the

agency] still maintains any discretionary authority” the species is listed);

page. B-48 (advising that no “reinitiation notice” need be included in the

report that concludes the conferencing process for projects affecting

species that are proposed to be listed “if discretionary Federal agency

involvement has terminated”; and p. E-24 (Service project leaders have a

“continuing responsibility to determine if discretionary ongoing activities

of the Service” comply with the requirements of Section 7).

15

“Annual operating permits issued prior to

issuance of a new hydropower license are

subject to the section 7 consultation if the

Federal agency has discretion to determine the

terms of the annual permits.”

Handbook at 4-29. Closer examination, however, reveals

that this memorialization of Platte River does not advance

the government's position either.

In Platte River, certain dam licensees under the

Federal Power Act were entitled to annual interim renewals

of their expiring fifty-year licenses under the same terms as

the original licenses until the Federal Energy Regulatory

Commission (“FERC”) could process a longer term renewal.

The Handbook appears to regard this situation as an example

of a completed federal action for which there is no remaining

federal involvement that “in itself’ could jeopardize a listed

species. Thus, this single reference in the Handbook hardly

stands for the broader proposition that the Services regard all

non-discretionary federal actions as beyond the reach of

Section 7(a)(2).

Whatever the Services’ understanding of Platte River

may be, an important distinction exists between the facts

there and those here. Platte River noted that FERC would

soon consult formally with the Service in connection with the

pending relicensing. 962 F.2d at 33. Thus, Platte River dealt

only with the temporary extension of existing dam operations

and their impacts; formal consultation was imminent and

~ would consider any changes needed to insure no jeopardy to

listed species. Here, however, the status quo is not being

continued temporarily, but is being fundamentally altered,

16

and the decision is of indefinite duration, rather than

transitory.®

Ill. EPA’S CONTENTION IS INCONSISTENT

WITH THE PURPOSES OF SECTION 7(a)(2)

AND THE CENTRAL ROLE OF THE

INTERAGENCY CONSULTATION PROCESS

IN RESOLVING APPARENT CONFLICTS

A. The Purposes Of The ESA Would Be

Frustrated By EPA’s Contention

EPA’s effort to create an exception not found in the

plain language of. Section 7(a)(2) would frustrate the

purposes of the ESA. Those purposes are to provide “a

means whereby the ecosystems upon which endangered

species and threatened species depend may be conserved”

and a “program for the conservation of such ... species.” 16

U.S.C. §1531(b). The purpose of “conserving” such species

can only be met by “bring[ing] any endangered species or

threatened species to the point at which the measures

provided pursuant to this Act are no longer necessary,” i.e.,

to the point at which a species has recovered and can be

removed from the official list of such species. Id. §1532(3).

* It is also unclear whether Platte River even dealt with Section

7(a)(2). In a pivotal sentence, the DC Circuit reasoned that “the statute

directs agencies to ‘utilize their authorities’ to carry out the ESA's

objectives; it does not expand the powers conferred on an agency by its

enabling act.” 962 F.2d at 34 (emphasis in original). However, the phrase

“utilize their authorities” appears only in Section 7(a)(1), 16 U.S.C.

§1536(a)(1), which imposes affirmative duties of federal agencies to

further the conservation of listed species. Whether or not Section 7(a)(1)

expands agency powers is irrelevant to Section 7(a)(2) which clearly

restricts how federal agencies carry out the activities they are empowered

to undertake.

17

Section 7(a)(2) is central to these purposes for several

reasons. First, it is the ESA’s only mechanism for ensuring

against the destruction or adverse modification of areas

designated as “critical habitat” because they are “essential to

the conservation” of a listed species. 16 U.S.C. §1533(5).

When Congress enacted the ESA, critical habitat was one of

its innovations, and yet the only regulatory consequence that

attaches to critical habitat does so through Section 7(a)(2).

Second, for plants, which comprise most of the listed species

in the United States,’ Section 7(a)(2) is generally the only

significant mechanism in the ESA to guard against

deleterious activities. '°

Finally, that Congress viewed Section 7(a)(2) as

critical to accomplishing the ESA’s goals is evident from the

extraordinary procedures required to secure relief from it.

Whereas the taking prohibition in Section 9 can be waived

simply by means of a permit issued by the Service for any

“otherwise lawful activity,” 16 U.S.C. 1539(a)(1)(B), waiver

of the prohibitory duties of Section 7(a)(2) is only available

in the event of a Presidentially declared major disaster, 16

U.S.C. §1536(p), a finding of the Secretary of Defense that a

waiver is “necessary for reasons of national] security,” 16

U.S.C. §1536(j), or as a result of a determination on the

record by a super-majority of a specially constituted

committee of Cabinet-level officials that the activity for

which the waiver is sought “is of regional or national

significance” and has no reasonable and prudent alternative.

16 U.S.C. §1536(h). No other duty imposed by any other

7 See http://ecos.fws.gov/tess_public/Boxscore.do (visited March 18,

2007). As of March 18, 2007, of the 1310 endangered or threatened

species in the United States, 744 were plants.

' Although Section 9 of the ESA, 16 U.S.C. §1538, broadly prohibits the

“taking” of endangered fish or wildlife, this prohibition does not extend

to plants. Instead, plants are afforded substantially less protection.

Compare 16 U.S.C. §1538(a)(1)(B) with 16 U.S.C. §1538(a)(2)(B).

18

provision of the ESA requires such extraordinary procedures

to secure an exemption from it, yet EPA’s contention would

effectively exempt an entire class of federal activities of

indeterminate scope’! from this core requirement of the ESA.

To achieve the far-reaching purposes of the ESA,

Congress was as encompassing and inclusive as it possibly

could have been throughout the law. For example, there are

no limitations on the plants and animals potentially subject to

the ESA’s protection. They include “any member of the

animal kingdom; including without limitation any mammal,

fish, bird ..., amphibian, reptile, mollusk, crustacean,

arthropod or other invertebrate,” as well as “any member of

the plant kingdom.” 16 U.S.C. §1532(8) and (14).) By

including all invertebrates and plants, Congress went well

beyond any earlier federal conservation law. M. Bean, The

Evolution of National Wildlife Law (1“ ed. 1977) at 445-46.

Neither are there are any limitations on the persons subject to

the ESA’s requirements. They include an exhaustive list of

natural, corporate, and governmental “persons” as well as

“any other entity subject to the jurisdiction of the United

States.” 16 U.S.C. §1532(13). There are no limitations on

the federal agencies subject to the ESA’s duties. They

include “any department, agency, or instrumentality of the

United States,” regardless of whether they manage land or

have other environmental responsibilities. Jd. §1532(7).

Like the examples just cited, Section 7(a)(2) is similarly

all-encompassing, applying to “each federal agency” and to

“any action authorized, funded, or carried out” by that

agency. Here, however, the government contends that when

Congress said “any action,” it really meant “some actions.”

'' As EPA itself notes, “it may require significant factual or legal analysis

to determine whether a potential effect on listed species is properly

attributable to an action mandated by Congress or to a related

discretionary judgment.” EPA Br. at 44.

-

19

That contention is not only contrary to the plain meaning of

Section 7(a)(2), but would frustrate the far-reaching purposes

of the ESA by excluding from its reach an expansive

category of federal actions.

B. EPA’s Position Undermines the Pivotal

Role That Congress’ Intended the

Interagency Consultation Process to Play in

Resolving Seeming Conflicts

1. The Role of the consultation process is

not simply to identify potential conflicts,

but to seek out ways to avoid them,

which it has largely done successfully.

Compliance with the prohibitory duty of Section 7(a)(2)

is facilitated through a process of “consultation” between the

“action agency” that authorizes, funds, or carries out the

action and the Service. Consultation is not simply a means

of determining whether a federal action transgresses the

Statutory prohibition. It is also, and more importantly, a

mechanism to explore fully the opportunity to reconcile

seeming conflicts between the survival imperatives of

affected species and the objectives of a particular federal

action. Congress, particularly since its substantial revision of

the consultation process in 1978, has regarded that process as

the lynchpin to the success of Section 7.

When Congress enacted the ESA, Section 7 was one of

its most significant changes from earlier legislation. M. Bean

& M. Rowland, The Evolution of National Wildlife Law (3

ed. 1997) at 199. From the beginning, Section 7’s duties

were to be accomplished “in consultation” with the Service.

The original Act did not further elaborate on the nature of

this consultation duty. In 1978 and 1979, following this

Court’s decision in TVA vy. Hill, Congress emphatically

affirmed the pivotal role that consultation was to play in the

20

workings of Section 7. Most importantly, the consultation

process was to provide for a searching inquiry not only into

the consequences of proposed federal actions, but also into

any reasonable and prudent alternative that could avoid the

prohibited impact of jeopardizing the continued existence of

any listed species, or destroying or adversely modifying its

critical habitat. See 16 U.S.C. §1536(b)(3) and (4). To

ensure the integrity of the consultation process and to ensure

that action agencies consulted in good faith, Congress

prohibited them from making any irreversible or irretrievable

commitment of resources that had the effect of foreclosing

the formulation or implementation of reasonable and prudent

alternative measures. ESA §7(d), 16 U.S.C. §1536(d). This

requirement was taken directly from the Services’ 1978

regulations, clear evidence that Congress was fully aware of

them. See 50 C.F.R. §402.04(a)(3) at 43 Fed. Reg. 875 (Jan.

4, 1978).

The process by which federal agencies comply with

Section 7(a)(2) is straightforward and can terminate at any of

three stages: (1) upon a unilateral determination by the

action agency that its proposed action will not affect any

listed species or critical habitat; (2) upon a determination by

the action agency, following “informal consultation,” that its

action is “not likely to adversely affect” any such species or

habitat, provided the Service concurs therewith; or (3) upon

issuance by the Service, following “formal consultation,” of a

biological opinion that evaiuates whether the proposed

action, or any reasonable and prudent alternative to it,

complies with Section 7(a)(2)’s duty to insure no jeopardy to

species or adverse modification of critical habitat. See 50

C.F.R. §402.14. In general, it has been extremely rare for

any proposed federal action to proceed through all three steps

of the compliance process only to meet with a negative

biological opinion that identifies no reasonable and prudent

alternatives within the authority of the action agency. The

formal consultation process between action agencies and the

Service has generally been quite successful in identifying

21

reasonable and prudent alternatives that allow action agency

objectives to be, met without jeopardizing the continued

existence of listed species or adversely modifying their

critical habitats.'? Likewise, in the informal consultation

process that comprises the second stage above, action

agencies often adopt modifications or compensatory

measures as part of their proposed actions to eliminate any

likelihood that the actions will adversely affect listed species

or critical habitat.

That, in fact, is what EPA did in American Forest &

Paper Ass'n v. United States EPA, 137 F.3d 291 (5" Cir.

1998). In that case, EPA never got to the third step of the

compliance process; it never formally consulted with the

Service or secured from it a biological opinion that examined

the proposed transfer of permitting authority to Louisiana.

Instead, as the Fifth Circuit’s opinion makes clear, “EPA

devised” a scheme whereby, in exchange for transferring

permitting authority to Louisiana, EPA secured the state’s

'2 The House report on the 1982 ESA amendments noted that “the

consultation provisions have functioned extremely well as a means

whereby potential conflicts between the conservation of [listed] species

and the carrying out of Federal activities can be avoided.” H.R. Rep. No.

97-567, at 24 (1982), reprinted in 1982 U.S.C.C.A.N. at 2824. During

floor debate, Rep. Forsythe reported that “in the last 3 fiscal years ...

there have been 10,762 consultations conducted under the Endangered

Species Act. Of those, ... only 192, 1.8 percent, resulted in a finding that

the project in question would jeopardize the continued existence of an

endangered species. Of those 192 projects, modifications were made in

185 and they went forward. Only seven projects in 3 years were stopped,

and | would point out that of those seven at least five, and perhaps all

seven, were stopped for reasons unrelated to the Endangered Species

Act.” 128 Cong. Rec. 12958 (June 8, 1982). For similar, more recent

statistics, see T. Rabot, The Federal Role in Habitat Protection,

Endangered Species Bulletin, vol. 24, no. 6 at 10-11 (Nov./Dec. 1999),

www.fws.gov/endangered/esb/99/11-12/10-l1l.pdf (visited March 18,

2007).

22

consent that if the state failed to satisfy the Service's

endangered species concerns with respect to particular

permits, EPA would veto those permits. 137 F.3d at 294.

EPA’s adoption of this procedure was not the result of formal

consultation with the Service, for there was none. Rather,

“public comments ... prompt{ed] EPA to adopt” it. Jd. at

296.

This procedural history of American Forest is important

because it clarifies the issue that the Fifth Circuit actually had

before it. EPA, without benefit of formal consultation with

the Service, modified its original proposed action in a way

that it thought would meet the “not likely to adversely affect”

test of the second stage of the compliance process. The Fifth

Circuit held that <PA’s conditioning of its approval upon

Louisiana’s consent to the scheme described above exceeded

EPA’s statutory authority. However, because no formal

consultation ever took place, EPA and the Service never

undertook the exhaustive examination of ail potential

alternatives to reduce the likelihood of jeopardy that a formal

consultation would have required. That the one measure

chosen by EPA after informal consultation to justify its “not

likely to adversely affect” determination exceeded its

authority does not mean that there were no other permissible

measures that might have been identified though formal

consultation. Put differently, even if, as the Fifth Circuit

asserted, “EPA lacks authority to modify the plain language

of the CWA by adding to the list of enumerated

requirements,”"* there may be other measures EPA can

3 Td. at 298, n. 6. In reaching this conclusion, the Fifth Circuit reasoned

that although CYA §402(b)(6), 33 U.S.C. §1342(b)(6), allows EPA to

veto a state permit based on the Secretary of Army’s concerns regarding

anchorage and navigation, “Congress could have, but did not, grant EPA

an analogous veto power to protect endangered species.” Id. at 298.

Regarding both this section and CWA §304(i), 33 U.S.C. §1314(1i), which

authorizes EPA to issue regulations governing the approval process for

State programs, the court drew support for its conclusion from the fact

23

undertake that would satisfy the requirements of Section

7(a)(2). Indeed, it is the purpose of formal consultation to

explore whether there are such alternatives. The Fifth Circuit

opinion should not be understood to presuppose the outcome

of a formal consultation process that had never occurred.

Yet, that is in effect the interpretation EPA advances

here. Indeed, EPA goes beyond American Forest by

asserting that the transfer of permitting authority to a state

never need proceed past the first stage of the compliance

process because such transfers do not meet the “may affect”

test of that stage. That contention not only goes beyond

Am?rican Forest, but it goes beyond any position previously

taken by EPA in connection with any previous transfer of

permitting authority.“

The practical consequence of the government’s position

that “non-discretionary” federal actions lie wholly outside the

reach of Section 7(a)(2) is that any agency that thinks it has

no discretion but to carry oui an action will never get past

Step One of the compliance process. There can be no serious

doubt that TVA, for example, believed it had no discretion

but to forge ahead with the completion of Tellico Dam.

that “neither section even mention{s] endangered species or the ESA.”

Id. It would have been remarkably prescient had Congress done so,

since the ESA had not yet been enacted.

” Although prior to 1993 the transfer of NPDES permitting authority was

accomplished without consultation, the record does not reveal the basis

for this fact. For 30 states, permitting authority was transferred cither

prior to enactment of the ESA or before there were any regulations

implementing the Section 7 consultation process. As of 1993, however,

following the significant expansion of the NPDES program caused by the

requirement for stormwater discharge permits, EPA consulted on all

transfers of NPDES permitting authority. For none of the pre-1993

transfers does the record reveal whether EPA made threshold “may

affect” determinations or, if it did, what the basis for those determinations

was.

24

Because Step One determinations are made unilaterally by

action agencies that need neither notify nor solicit the views

of the Service on those determinations, the rule advocated by

the government here will create a powerful incentive for

agencies to self-characterize their actions as non-

discretionary and thus bypass the consultation process that

Congress deemed central to accomplishing the purposes of

the ESA.

2. EPA’s position ignores the authorities it

has that could reduce the likelihood of

prohibited impacts

Petitioners make much of the fact that, as originally

enacted, Section 7 required federal agencies to “utilize their

authorities in furtherance of the purposes of” the ESA by

“insur[ing] that actions authorized, funded, or carried out by

them do not jeopardize the continued existence” of listed

species or destroy or modify their critical habitats.

Petitioners assert that the reference to “utiliz{ing] their

authorities” was intended by Congress to continue to apply to

the duties now set forth in Section 7(a)(2), even though that

language appears in Section 7(a)(1) and not in Section

7(a)(2). But even if those words were part of Section 7(a)(2),

they would not support the Petitioners’ position here. Where

Petitioners err is in construing those words confine the

inquiry under Section 7(a)(2) to the precise authority for the

action in question. Instead, they should be read less

myopically to require inquiry into all of the authorities that

an agency may have to reduce the likelihood of its action

having a prohibited impact.

Even if the CWA requires EPA to approve the

transfer of permitting authority to a state that meets the CWA

criteria, and even if Section 7(a)(2) of the ESA confers no

additional authority upon EPA to condition or qualify its

transfer, the requirements of Section 7(a)(2) still apply to

EPA’s action. Unlike in Public Citizen, where no purpose

would have been served by requiring FMCSA to prepare an

25

environmental impact statement explaining the effects of a

decision already made, the requirements of Section 7(a)(2)

are not nullified even if a particular decision is mandated, for

they affect how that decision is carried out.

Applying the consultation requirement of Section

7(a)(2) here will serve the salutary intended purpose of

exploring all means within EPA’s authority to reduce the

likelihood of jeopardizing the continued existence of any

listed species. EPA’s transfer decision, after all, triggers a

continuing duty on it to oversee the administration of the

state program. CWA §402(c), 33 US.C. §1342(c).

Moreover, EPA may object to the issuance of individual

permits that it deems to be “outside the guidelines and

requirements” of the CWA. CWA §402(d), 33 U.S.C.

§1342(d).'° Consultation between EPA and the Service at

the time of transfer can and should explore how EPA will

exercise its oversight and permit objection authorities to

reduce the likelihood that the continued existence of any

threatened or endangered species will be jeopardized as a

result of the transfer of NPDES authority. EPA and the

Service might, for example, agree upon a special set of

procedures they will jointly employ to provide special

scrutiny to permits in particular areas, or permits associated

with particular types of projects. Such special procedures

could supplement EPA’s general expertise with the Service’s

particular biological expertise regarding the requirements of

iS The regulations that implement Section 7(a)(2) define “Effects of the

action” to include “direct and indirect effects of an action” as well as “the

effects of other activities that are interrelated or interdependent with that

action.” “Interrelated actions” refer to “those that are part of a larger

action and depend on the larger action for their justification.”

“Interdependent actions” refer to actions “that have no independent utility

apart from the action under consideration.” 50 C.F.R. §402.02. EPA's

post-delegation oversight activities are interdependent upon its delegation

action, inasmuch as they have no independent utility without the

delegation.

26

listed species. Indeed, special procedures such as these were

typically agreed upon as a result of the consultations that

took place with respect to the six states to which permitting

authority has been transferred since 1993."°

3. If a truly irresolvable conflict exists, the

exemption process is the required means

of addressing it.

EPA relies heavily upon American Forest for the

proposition that Section 7(a)(2) merely “channels” existing

agency authority in a particular direction. This description

fundamentally mischaracterizes the role and function of

Section 7(a)(2), which both guides how agencies carry out

their various authorities and ultimately serves as a barrier to

or restraint upon what federal agencies could otherwise do.

TVA vy. Hill did not “channel” TVA’s authority into building

dams with permanently open gates. Rather it prevented TVA

from using its authority to close the gates on a neany

completed dam that threatened to extirpate an endangered

fish.

Congress recognized, as a result of TVA v. Hill, that

there would on occasion be situations in which no reasonable

and prudent alternative to a proposed federal action meets the

requirements of Section 7(a)(2). When such irresolvable

conflicts exist, Congress established a special process by

which federal actions that conflict with Section 7(a)(2) may

© Petitioner National Association of Home Builders argues in its brief (p.

11) that when these consultations took place “EPA did not acknowledge

that it was legally obligated” to consult, but was free to do so voluntarily.

But what purpose does voluntary consultation serve unless, as a result of

such consultation, steps are identified that would tend to reduce the

likelihood of adverse impact to listed species? And if EPA can undertake

those steps following voluntary consultation, it can do so as a result of

consultation required by Section 7(a)(2).

27

be exempted therefrom. If EPA lacks the authority to

implement any alternative that is consistent with Section

7(a)(2), it may proceed with its action only by securing an

exemption through Section 7(h), 16 U.S.C. §1536(h).

Because the consultation process has almost always

avoided irresolvable conflicts, the exemption process has

rarely been used. Nevertheless, a seven-member

“Endangered Species Committee” can grant exemptions if at

least five of its members determine that the benefits of the

action for which >.emption is sought “clearly outweigh the

benefits of alternative courses of action” that preserve the

species. 16 U.S.C. §1536(h)(1)(A)(ii). Congress intended

that in making this determination the Committee would

consider alternatives outside the action agency’s authority.

As explained by Senator Culver, the floor manager in the

Senate of the bill (S. 2899) that created the Committee, “[i]n

reviewing available alternatives to the action under review,

the committee would be charged to examine the benefits of

all available alternatives, not simply those which are within

the agency’s jurisdiction.” 124 Cong Rec. $10896 (daily ed.

July 17, 1978), reprinted in A Legislative History of the

Endangered Species Act of 1973, as Amended in 1976, 1978,

1979, and 1980 at 962-63 (1982, emphasis added). See also

50 C.F.R. §§450.01 and 453.03(a)(1)(ii) (Commitiee may

consider alternatives, “including both no action and

alternatives extending beyond... acting agency

jurisdiction”). Thus, even when an agency has no authority

to do anything to avoid conflict with its duty to insure no

jeopardy, it remains subject to Section 7(a)(2) and can avoid

its restraining effect only by securing an exemption.

IV. EPA’S CONTENTION THAT NON-

DISCRETIONARY FEDERAL ACTIONS ARE

NOT SUBJECT TO SECTION 7(a)(2) WOULD

HAVE UNANTICIPATED NEGATIVE

CONSEQUENCES FOR FEDERAL AGENCIES

28

EPA’s contention that non-discretionary actions are not

subject to Section 7(a)(2) could have troubling ramifications

for federal agencies generally. In particular, agencies and

their officials carrying out putatively “non-discretionary”

actions could be liable for civil or criminal penalties, or

subject to injunction, for violating the ESA’s taking

nrohibition without the authorization provided by Section

7(0)(2), 16 U.S.C. §1536(0)(2).

Those consequences stem from the interplay between

Section 7(a)(2) and the prohibition against “taking”

endangered fish or wildlife in Section 9(a)(1)(B), 16 U.S.C.

§1538(a)(1)(B). As Justice Scalia noted in Babbitt v. Sweet

Home Chapter of Communities for a Great Oregon, 515 U.S.

687, 724 (1995), these provisions “do not operate in separate

realms; federal agencies are subject to both, because the

‘person{s]’ forbidden to take protected species under [Section

9] include agencies and departments of the Federal

Government.” (Scalia, J., dissenting; emphases in original).

Indeed, as Justice Scalia further noted in Bennett v. Spear,

520 U.S. 154, 172 (1997), an action agency that takes a listed

species exposes its employees to “substantial civil and

criminal penalties” because “persons” subject to the Act

explicitly include not only agencies and departments of the

Federal Government, but “any officer, employee, [or] agent”

thereof. 16 U.S.C. §1532(13).

The fact that federal agencies are subject to both —

provisions prompted 1982 amendments that provided relief

from the taking prohibition in certain circumstances.

Congress’s concern was expressed as follows in the House

Committee Report:

“After complying with the rigorous demands

of the Section 7 consultation process, the

applicant or Federal agency receives no

assurance that any _ incidental and

unintentional takings contemplated under a

29

Section 7 consultation will not be prosecuted

under Section 9 which prohibits any taking.”

H. Rep. No. 97-567, 97" Cong., 2d Sess. at 15 (1982),

reprinted in 1982 U.S.C.C.A.N. 2815; see also S. Rep. No.

97-418, 97" Cong., 2d Sess. at 21-22 (1982). Congress

remedied this dilemma with amendments embodied in

Section 7(b)(4) and 7(0)(2), 16 U.S.C. 1536(b)(4) and

1536(0)(2). The former provides that if the Service

concludes, after consultation, that the federal action would

not violate Section 7(a)(2) but may result in the incidental

taking of a listed species, the Service must include in its

biological opinion “reasonable and prudent measures” to

minimize the impact of such incidental taking. The latter

provides that any taking that is in compliance with such

reasonable and prudent measures shall not be considered a

prohibited taking.

Unless federal actions undergo formal consultation, there

may be no means of securing for them relief from the ESA’s

taking prohibition. Section 10(a)(1)(B) of the ESA, 16

U.S.C. 1539(a)(1)(B), authorizes permits to take listed

species incidental to otherwise lawful activities, but it is well

established that permits under this provision are not available

to federal agencies,” Section 7(b)(4)- and Section

'? In explaining the new permitting provision of Section 10(a)(1)(B) in

1982, the House floor manager of bill characterized it as “involv[ing]}

permits for the taking of endangered species when no other Federal action

is involved.” 128 Cong. Rec. 26188 (Sept. 30, 1982, remarks of Rep.

Breaux). Under the heading, “Who Can Apply for a Section 10 Permit?”

the Services’ Habitat Conservation Planning Handbook , available at

www .fws.gov/endangered/hep/hcpbook.htm (visited March 21, 2007),

explains that “Section 10 permits can be issued to state, municipal, or

tribal governments, corporations or businesses, associations, and private

individuals. They can be issued to entities that are a combination of

these, such as joint power authorities, watershed councils, and other

planning authorities.” Handbook at 3-1, In short, Section 10(a)(1)(B)

30

10(a)(1(B) thus provide mutually exclusive mechanisms to

authorize incidental take: the former for federal actions and

the latter for non-federal actions. The idea that there might

be some federal actions not subject to Section 7 — i.e., those

EPA characterizes as non-discretionary — clearly never

occurred to Congress. If EPA’s view is correct, then federal

agencies can never secure authorization to take listed species

when carrying out non-discretionary actions, because those

actions cannot be the subject of a biological opinion — the

only mechanism by which federal agencies can receive

authorization for such take. That Congress never

contemplated such an inexplicable result is certain, yet it is

precisely the result that flows from the legal proposition that

EPA asserts here.

CONCLUSION

The judgment below should be affirmed and the case

remanded for further proceedings consistent with the

requirements of Section 7(a)(2) of the ESA.

Respectfully submitted.

Michael J. Bean

Senior Attorney

Environmental Defense

March 27, 2007

permits are available to anyone except federal agencies. The Handbook

continues: “The standard method for authorizing take for Federal

agencies is through the Section 7 consultation process. Actions

authorized, funded, or carried out by Federal Agencies must go through

the Section 7(a)(2)consultation process” (emphasis added). Id. at 3-1 to

3-2.