Amicus Curiae Brief — Weyerhaeuser Co. v. U.S. Fish & Wildlife Serv., 139 S. Ct. 45 (2018) (No. 17-71)

No. 17-71

In the

Supreme Court of the Anited States

°

WEYERHAEUSER COMPANY,

Petitioner,

Vv.

UNITED STATES FISH AND WILDLIFE SERVICE,

ET AL.

Respondents.

°

On a Writ of Certiorari to the United States

Court of Appeals for the Fifth Circuit

°

BRIEF OF AMICT CURIAE BUILDING INDUSTRY

LEGAL DEFENSE FOUNDATION, CALIFORNIA

CATTLEMEN’S ASSOCIATION, CALIFORNIA

BUSINESS PROPERTIES ASSOCIATION,

CALIFORNIA FORESTRY ASSOCIATION, AND

CALIFORNIA CHAMBER OF COMMERCE IN

SUPPORT OF PETITIONER WEYERHAEUSER

COMPANY AND RESPONDENTS MARKLE

INTERESTS, LLC, ET AL.

+

PHILIP A. SANDICK PAUL J. BEARD II

Alston & Bird LLP Counsel of Record

1201 West Peachtree Street MAUREEN F. GORSEN

Suite 4900 Alston & Bird LLP

Atlanta, GA 30309-3424 1121 L Street, Suite 700

(404) 881-7000 Sacramento, CA 95814

(916) 498-3354

paul beard@alston com

Counsel for Amici Curiae

i

QUESTION PRESENTED

1. Whether the Endangered Species Act

prohibits designation of private land as unoccupied

critical habitat that is neither habitat nor essential to

species conservation.

2. Whether an agency decision not to exclude

an area from critical habitat because of the economic

impact of designation is subject to judicial review.

il

TABLE OF CONTENTS

QUESTION PRESENTED....................c.c0:000e0000+

TABLE OF AUTHORITIEG...................cc00-ssee00s

IDENTITIES AND INTERESTS OF AMICI

If.

DESIGNATIONS OF ACTUAL

HABITAT ALREADY IMPOSE

SUBSTANTIAL RISKS AND COSTS

ON SOCIETY AS A WHOLE;

RAMPANT DESIGNATIONS OF NON-

HABITAT WOULD DRAMATICALLY

WORSEN THOSE RISKS AND COSTS

HABITAT DESIGNATIONS AFFECT

EVEN PROJECTS THAT DO NOT

REQUIRE FEDERAL ACTION..............

STATES, LOCAL GOVERNMENTS,

AND THE PRIVATE SECTOR ARE

PLAYING AN EVER-GROWING ROLE

IN SPECIES CONSERVATION,

MAKING IT UNNECESSARY—AND

UNWISE—TO EXPAND THE

SERVICE’S DESIGNATION POWER

TO INCLUDE NON-HABITAT WITH

NO NEXUS TO A LISTED SPECIES ....

iv

TABLE OF AUTHORITES

Page(s)

Cases

Bennett v. Spear,

ERT SEE nan enaenoesomme nar 10

Markle Interests, L.L.C. v. United States

Fish & Wildlife Serv.,

848 F.3d 635 (Sth Cir. 2017).................:cccceccceseeeeeee 5

Rapanos v. United States,

a ca caadiinbslianeniemnetniics 7

Ross v. Cal. Coastal Comm'n,

199 Cal. App. 4th 900 (2011) .................:0ccccceeeee 17

Sackett v. Environmental Protection Agency,

a RE A DC 11

Tenn. Valley Auth. v. Hill,

cen ctarciernatatl 10

Federal Statutes

a scsemneitiesipmanioneniantan 4

Be ee ie I asi ccccccscnsecsctancesoscstsntivsconsese 4

i ssrasicenaniislameieenibiael 9

Cc _

State Statutes

Cal. Fish & Game Code § 2050 (West 2018) .............. 7

Came, PU, TDR, CR BD oc cccccccsccccccccccssecceescoce 7, 16

Se Be By I ncricstccccnctnnnsscnssnascsanescaneoes 7

Cal. Pub. Res. Code § 3000.5 ..0............:.:cccceeccecesees 17

Cal. Pub. Res. Code § 30107.5 ...0...........:ccccccecccceeeees 18

Cal. Pub. Res. Code § 30240 (a) ....0...0......00ccccccccccceeeee 18

Regulations

III eincnsiicclouistisituninnnitsisnnnmintnesnednedenensiibiieid 9

Re ITI silico cin remenpatinslennesintncudictnnisladnduendint 10

SE TORE are ate a 10

ee Oe acer sciscicnnacidgutsininictandsteeiccsonnancinenien 10

49 Fed. Reg. 27510 (July 5, 1984)..0.000 ee 10

76 Fed. Reg. 2863 (Jan. 18, 2011)..........00.00000000000. 16

77 Fed. Reg. 35118 (June 12, 2012).......0000000........ 5, 13

77 Fed. Reg. 35123 (June 12, 2012) 2000.20... 5

77 Fed. Reg. 35129 (June 12, 2012).....0200 eee. 5

77 Fed. Reg. 35141 (June 12, 2012).....0000000000....... 5, 13

77 Fed. Reg. 35146 (June 12, 2012) 0000000000... ccce cece e 5

Other Authorities

Adler, Jonathan H., Wetlands, Property

Rights, and the Due Process Deficit in

Environmental Law, 2012 Cato Sup. Ct.

Be cs dics cdaiuihieenistinncnascitananssconéenenes 12

Arha, Kaush, et al., Endangered Species Act

and Federalism: Effective Species

Conservation through Greater State

Commitment 9 (Woods Inst. for

Environment, Stanford L. Sch. Policy

Paper)

https://woods.stanford.edu/sites/default/f

iles/files/Endangered-Species-Act-Policy-

Paper-20050224. pdf. ............c0ccecescese00-0e 20, 21, 22

California Coastal Commission, Revised

Staff Report and Recommendation on

Consistency Certification, for

Consistency Certification No. CC018-07

29 (Feb. 6, 2008)

https://documents.coastal.ca.gov/reports/

2008/2/WSb-2-2008 pdf .........2222..00ccccccesseeeeeeeeeenes 19

California State Senate Majority Caucus,

Confronting California’s Housing Crisis

(2018),

http://focus.senate.ca.gov/housing# ..................... 14

Camacho, Alejandro E., et al. Assessing

State Laws and Resources for

Endangered Species Protection, 47 Envti.

e BTU CII SED ceccesccwscrscsensecsncenssessccscors 2?

vii

CRA International, Economic Effects of

Critical Habitat Designation for the

California Tiger Salamander in Sonoma

Sy Oe as crcscettssvenrcccnscescescoccses 17

Dougherty, Conor, California Housing

Problems Are Spilling Across Its

Borders, N.Y. Times, Mar. 20, 2018.................... 14

Farewell, Dashiell, Revitalizing Critical

Habitat: The Ninth Circuit’s Pro-

Efficiency Approach, 46 Envtl. L. 653

Geddes, Pete, The Yellowstone of the Future,

Be is I SI III iticsiscisicccvessitconioncdecnccnses 22

Huggins, Laura, Contracting for

Conservation, Property and

Environment Research Center (Sept. 14,

2017),

https://www.perc.org/2017/09/1 4/contract

EA ee x

James, Norman D., et al, Critical Habitat’s

Limited Role Under the Endangered

Species Act and Its Improper

Transformation into “Recovery” Habitat,

34 UCLA J. Envtl. L. & Pol’y 1, 6 (2016)............ 11

Liebesman, Lawrence R, et al., Federal

Agency Consultation and Recovery

Planning Under The Endangered Species

Act, SLO91 ALI-ABA 327, 333 (June

viii

Nagle, John Copeland, The Original Role of

the States in the Endangered Species Act,

53 Idaho L. Rev. 385, 388 (2017) ...........000...00....

Schatz, Bryan, California’s Housing Crisis

Is So Bad, Families Are Squatting

Abandoned Homes Just to Survive,

Mother Jones (Mar./Apr. 2018),

https://www.motherjones.com/crime-

justice/2018/04/retake-the-house/........................

Sinden, Amy, The Economics of Endangered

Species: Why Less Is More in the

Economic Analysis of Critical Habitat

Designations, 28 Harv. Envtl. L. Rev.

Turner, Andrew, J, et al., A Wider View of

the Impacts of Critical Habitat

Designation: A Comment on Critical

Habitat and the Challenge of Regulating

Small Harms, 43 Envtl. L. Rep. News &

ee ee ininiccunticceticctitccmvetatssntcinccsnets

United States Fish and Wildlife Service,

Critical Habitat under the Endangered

Species Act (June 13th, 2017)

https://www.fws.gov/southeast/endanger

ed-species-act/critical-habitat/.............................

Western Governors’ Association, Species

Conservation and Endangered Species

Act Initiative,

http://westgov .org/initiatives/species-

EE cctiscceisnatictecdaricibuiusavabintdcseeseccnminnss

13

ix

Wilde, Candee, Evaluating the Endangered

Species Act: Trends in Mega-Petitioners,

Judicial Review, and Budget Constraints

Reveal a Costly Dilemma for Species

Conservation, 25 Villanova Envtl. L.J.

ERR EI SSS A ea 8

Wozny, Kateri, Hope for California’s

Housing Crisis?, U.S. News and World

Report (April 3, 2018, at 12:01 a.m.),

https://www.usnews.com/news/best-

states/articles/20 18-04-03/is-there-hope-

for-californias-housing-crisis .............................. 14

Zabel, Jeffrey E., et al., The Effects of

Critical Habitat Designation on Housing

Supply: An Analysis of California

Housing Construction Activity, 46 J.

Reg’l Sci. 67 (2006) ............00cccccecececececesecesereres 12,13

l

IDENTITIES AND INTERESTS OF AMICI

CURIAE

Building Industry Legal Defense Foundation,

California Cattlemen’s Association, California

Business Properties Association, California Forestry

Association, and California Chamber of Commerce

submit this brief amicus curiae in support of

Petitioner Weyerhaeuser Company and Respondents

Markle Interests, LLC, et al.'

The Building Industry Legal Defense

Foundation (“BILD”) is a non-profit mutual benefit

corporation and a subsidiary of the Building Industry

Association of Southern California, Inc.

(“BLASC”). BLASC represents approximately 1,200

member companies across Southern California that

are active in all aspects of the building industry,

including land developers; builders of housing,

commercial, and infrastructure; and architects,

engineers, planners, contractors, and suppliers. The

purposes of BILD are, in part, to initiate or support

litigation or agency action designed to improve the

business climate for the building industry and to

monitor government regulation critical to the

industry.

California Cattlemen’s Association is the

preeminent organization of cattle grazers in

' The parties have filed a blank consent to the filing of amicus

curiae briefs. No counsel for a party authored this brief in whole

or in part, and no counsel or party made a monetary contribution

intended to fund the preparation or submission of this brief. No

person other than amicus curiae, ite members, or ita counsel

made a monetary contribution to ita preparation or submission.

2

Califormia, and acting in conjunction with its affiliated

local organizations, it endeavors to promote and

defend the interest of the livestock industry. Formed

in 1917 as a non-profit trade association, the

Cattlemen's Association promotes the interests of

ranchers both large and small in California. Beef

cattle producers operate on over 38 million of

California’s 100 million acres. The Cattlemen's

Association has 35 local cattlemen’s association

affiliates that serve as a strong link between the

grassroots membership and the association. The

Cattlemen's Association represents its members’

interests before the California State Legislature,

Congress, and federal and state regulatory agencies

on a wide range of issues including federal lands

grazing fees and regulation, wetlands, conservation

programs, air quality, wildlife management, parcel

fees, and other issues affecting the use and ownership

of California’s rangelands.

California Business Properties Association

(“CBPA”) is a commercial real estate trade association

that serves as the legislative and regulatory advocate

for property owners, tenants, developers, retailers,

contractors, land-use attorneys, brokers, and other

professionals in the commercial real estate industry.

With over 10,000 members, CBPA is the largest

consortium of commercial real estate professionals in

California. Its members range from some of America’s

largest retailers and commercial property owners and

tenants, to individual and family-run commercial rea!

estate interests.

California Forestry Association is a nonprofit,

nonpartisan organization dedicated to sustainable

3

uses of renewable resources and responsible forestry.

Association membership includes forest land owners,

forestry professionals, loggers, manufacturers,

wholesalers, and retailers who are engaged in the

production and distribution of wood products. These

members own 3.8 million of the 7.4 million acres of

private forest land in California and are committed to

protecting and enhancing the natural life cycle of

California’s forests. They also supply wood resources

by contracting to purchase and harvest significant

amounts of timber from public lands, including the

national forests.

The California Chamber of Commerce

(“CalChamber’) is a non-profit business association

with over 13,000 members, both individual and

corporate, representing virtually every economic

interest in the state of California. For over 100 years,

CalChamber has been the voice of California business.

While CalChamber represents several of the largest

corporations in California, seventy-five percent of its

members have 100 or fewer employees. CalChamber

acts on behalf of the business community to improve

the state's economic and jobs climate by representing

business on a broad range of legislative, regulatory

and legal issues. CalChamber often advocates before

federal and state courts by filing amicus curiae briefs

and letters in cases, like this one, involving issues of

paramount concern to the business community.

Amici represent a broad cross-section of those

individuals and businesses who own, lease, and make

productive use of private lands in California. As a

consequence, they are deeply concerned about the

proper scope of the power of the United States Fish

4

and Wildlife Service (“FWS” or “Service”) under the

Endangered Species Act to designate private property

as “critical habitat” for protected species. If, as the

Fifth Circuit Court of Appeals in this case held, the

FWS has the authority to impose a “critical habitat”

designation even on property that is not habitat for

any protected species—and is not even suitable for

that purpose— then Amici’s members face increasing

regulatory burdens on and uncertainty over their

ability to use and develop their properties.

INTRODUCTION AND SUMMARY OF THE

ARGUMENT

The Endangered Species Act (“ESA”) requires

the FWS? to identify and list endangered and

threatened animals and plants. 16 U.S.C.

§ 1533(a)(1). The listing of an animal species triggers

the Service’s statutory obligation to designate “critical

habitat” for that species “to the maximum extent

prudent and determinable.” /d. § 1533(a)(3)(A)(i). In

this case, a panel of the Fifth Circuit upheld the

Service’s designation of private land in Louisiana as

“critical habitat” for a listed species despite the fact

2 The United States Department of Interiors FWS and the

United States Commerce Department's National Marine

Fisheries Service (“NMFS”) both administer the ESA. The FWS

has primary responsibility for terrestrial and freshwater

wildlife, like the Dusky Gopher Frog here, while NMFS has

jumsdiction over marine wildlife. For simplicity’s sake, this bnef

refers only to FWS given that the case involves a species within

ita jurisdiction, but the same principles discussed herein apply to

NMFS.

5

that the land is uninhabited—and uninhabitable—by

that species.

All of the known Dusky Gopher Frogs live in

Mississippi more than 50 miles away from the

Louisiana land at issue. See Final Rule for the

Designation of Critical Habitat for the Dusky Gopher

Frog (the “Final Rule”), 77 Fed. Reg. 35118, 35146

(June 12, 2012) (showing map of critical habitats). The

Service could not relocate the frogs onto the Louisiana

land without the landowner’s consent, see id. at

35,123, and the landowners have consistently

explained that they do not and will not consent. See

Markle Interests, L.L.C. v. United States Fish &

Wildlife Serv., Case No. 14-31008, Doc. 005128568 10,

Joint Brief of the Appellants at 7 n.2 (quoting public

comments). Further, if the frogs somehow ended up on

the Louisiana land as it exists today, they would die.

See Final Rule, 77 Fed. Reg. at 35,129. Nonetheless,

the Louisiana land was designated as “essential” to

the species’ conservation, imposing substantial costs

on the landowners—$34 million by the Service's

calculation—and creating a precedent that puts

virtually all United States land at risk of designation.

See 77 Fed. Reg. 35118, 35141; Markle Interests,

L.L.C. v. United States Fish & Wildlife Serv., 848 ¥ 3d

635, 637 (5th Cir. 2017) (Jones, J., dissenting from

denial of rehearing en banc).

Drawing partly on the California experience,

the first and second parts of this brief describe the

impacts on landowners and consumers that will result

from a federal power to designate non-habitat as

“critical habitat” for protected species. The Service

routinely assures private landowners that

6

designations of their property as “critical habitat” do

not affect their land ownership or establish a refuge,

wilderness, reserve, preserve or other conservation

area. See, e.g., United States Fish and Wildlife

Service, Critical Habitat under the Endangered

Species Act (June 13th, 2017)

https://www_.fws.gov/southeast/endangered-species-

act/critical-habitat/, It emphasizes that such

designations do not allow the federal government or

the public to access their lands, and do not result (at

least automatically) in closure of the designated area

to private use and development. /d. At worst, the

Service claims, a “critical habitat” designation affects

only projects on private lands requiring federal action

that may adversely modify the designated critical

habitat, e.g., projects requiring a federal permit, a

federal license, or federal funding. /d. In that case, the

federal agency undertaking the action must consult

with the Service to avoid jeopardizing the existence of

listed species and their critical habitat.“

The Service's narrative masks the harsh reality

faced by developers, businesses, ranchers, foresters

and others with a “critical habitat” designation on

their land. First, as federal permitting jurisdiction

has expanded over the last several decades, so too

have the circumstances under which federal agencies

need to consult with the Service to ensure that use

* According to the Service's representations at oral argument

before the Fifth Circuit, there is virtually no effect on the land

until the landowner receives a determination by the Service or

the U.S. Army Corps of Engineers that a proposed development

qualifies as an “adverse modification.” And at that point, the

Service offered, the landowner could challenge the adverse

modification determination.

7

and development of the property are limited to avoid

adverse modification to any critical habitat. And

second, the designation itself is costly in terms of

additional permitting impediments and decreased

land value. Those are on top of the costs of the

consultation process itself. See Lawrence R.

Liebesman & Rafe Petersen, Federal Agency

Consultation and Recovery Planning Under The

Endangered Species Act, SLO91 ALI-ABA 327, 333

(June 2006) (“The consultation process can be lengthy

and complex with extensive negotiations between a

project applicant, the Corps and the FWS.”).

The third part of this brief discusses how

federal designations of non-habitat are both

duplicative of and inimical to state and local efforts,

and private initiatives, to conserve species.

“Regulation of land use” is “a quintessential state and

local power.” Rapanos v. United States, 547 U.S. 715,

738 (2006) (plurality). With the discretion to designate

even non-habitable land as “critical habitat,” the

Service’s power and influence over private property in

the United States will rise to an unprecedented

level__far beyond what Congress contemplated or the

Constitution permits. Indeed, nowhere does the ESA

contain the “clear and manifest statement from

Congress” that is expected when statutes authorize an

“unprecedented intrusion” into an area of “traditional

state authority” such as land-use regulation. /d.

(internal quotation and citation omitted). California is

a case in point. With the California Environmental!

Quality Act, Cal. Pub. Res. Code § 21000 (West 2018)

(“CEQA”), the California Coastal Act, Cal. Pub. Res.

Code § 30000 (West 2018) (“CCA”), the California

Endangered Species Act, Cal. Fish & Game Code

8

§ 2050 (West 2018) (“CESA”), and a potpourri of other

environmental statutes, California—and many other

states like it—are well-equipped to balance important

economic interests (such as the need to address the

critical shortage of housing), and the state’s interest

in protecting threatened and endangered animals on

private lands.

What’s more, the private sector has begun

supporting conservation initiatives in new and more

significant ways. See, eg., Laura Huggins,

Contracting for Conservation, Property § and

Environment Research Center (Sept. 14, 2017),

https://www.perc.org/20 17/09/14/contracting-for-

conservation/. Private entities that historically may

have resisted conservation efforts are now aligned

with those efforts. Affirming the Service’s unlimited

“designation” power threatens to reverse the organic

trend of state, local and private efforts to deal with

quintessentially local concerns.

Finally, given its limited resources, the Service

can barely pursue its statutory priorities. Indeed, as

the countless lawsuits against it over the years show,

the Service finds it challenging even to meet the most

basic deadlines for completing “status reviews” of

listed species every five years and other obligations.

Candee Wilde, Note, Evaluating the Endangered

Species Act: Trends in Mega-Petitioners, Judicial

Review, and Budget Constraints Reveal a Costly

Dilemma for Species Conservation, 25 Villanova

Envtl. L.J. 307, 321-23 Wan. 1, 2014). The last thing

the Service needs is the power to pursue low-priority

objectives—like searching for, and designating as

“critical habitat,” land that does not host and is

9

inhospitable to any protected species. Such new power

can be expected to create a new cottage industry of

litigation against the Service, thereby further

undermining the agency’s more important priorities.

For all these reasons, the Fifth Circuit's decision

should be reversed, and the Service’s power limited to

designating actual habitat that is critical to a listed

species.

ARGUMENT

I. DESIGNATIONS OF ACTUAL HABITAT

ALREADY IMPOSE SUBSTANTIAL

RISKS AND COSTS ON SOCIETY AS A

WHOLE; RAMPANT DESIGNATIONS OF

NON-HABITAT WOULD DRAMATICALLY

WORSEN THOSE RISKS AND COSTS

As alluded to above, the Service's designation

of land as “critical habitat” is legally consequential.

Section 7 of the ESA requires that federal agencies

ensure that their “actions” are not likely to jeopardize

the continued existence of a listed species or destroy

or adversely modify its critical habitat. 16 U.S.C.

§ 1536(a)(2). “Actions” are defined as “all activities or

programs of any kind authorized, funded, or carried

out, in whole or in part, by Federal agencies in the

United States or upon the high seas,” and include “the

granting of licenses, contracts, leases, easements,

rights-of-way, permits, or grants-in-aid.” 50 C.F_R.

§ 402.02. Thus, the range of federal actions that can

trigger consultation is extraordinarily broad.

Under Section 7, federal agencies must consult

with the Service on any actions that may affect listed

10

species and their habitats to ensure that reasonable

and prudent measures will be undertaken to mitigate

impacts on listed species. 16 U.S.C. § 1536(b)(3)(A); 50

C.F.R. § 402.14; see also Bennett v. Spear, 520 U.S.

154, 158 (1997). Consultation with the Service can be

either formal or informal depending on the likelihood

of the action to adversely affect listed species or

critical habitat. 50 C.F.R. §§ 402.13, 402.14. Once a

formal consultation is initiated, the Service will issue

a Biological Opinion (either a “no jeopardy” or a

“jeopardy” opinion) indicating whether the proposed

agency action will jeopardize the continued existence

of a listed species or result in the destruction or

modification of its critical habitai. 16 U.S.C.

§ 1536(b)(3)(A); 50 C.F_R. § 402.14(g). Importantly, a

permit will not be issued for a project with a

“jeopardy” opinion unless it is redesigned to lessen

impacts; needless to say, “biological opinions under

Section 7 have the power to stop development projects

in their tracks and have sometimes done so.” Amy

Sinden, The Economics of Endangered Species: Why

Less Is More in the Economic Analysis of Critical

Habitat Designations, 28 Harv. Envtl. L. Rev. 129, 141

(2004); see, e.g., Tenn. Valley Auth. v. Hill, 437 U.S.

153 (1978) (ruling that the almost-constructed Tellico

Dam, the completion of which (it was thought*) would

* Subsequent to the Court's decision, “several small relict

populations” of snail darter were discovered in other streams.

See Zygmunt J.B. Plater, Law and the Fourth Estate:

Endangered Nature, the Press, and the Dicey Game of Democratic

Governance, 32 Envtl. L. 1, 8 n.22 (2002). In 1984, the Service

downlisted the fish to threatened status and rescinded ita critica!

habitat. See 49 Fed. Reg. 27,510 (July 5, 1984).

11

eradicate the endangered snail darter (a small

freshwater fish), could not proceed).

If landowners hardly ever needed federal

authorization or funding for projects proposed on their

properties, critical habitat designations might be

considered relatively inconsequential from a legal and

economic standpoint. But that is not the case.

Increasingly, landowners have witnessed ever-greater

involvement by federal agencies in land use and

development. “As federal regulatory programs have

expanded, an increasing number of non-federal

activities require some sort of federal permit or

approval, or some other federal nexus that triggers

Section 7(a)(2) and the duty to avoid the adverse

modification of critical habitat.” Norman D. James &

Thomas J. Ward, Critical Habitat’s Limited Role

Under the Endangered Species Act and Its Improper

Transformation into “Recovery” Habitat, 34 UCLA J.

Envtl. L. & Pol’y 1, 6 (2016).

Nowhere has the expansion of federal

regulatory programs been more pronounced than in

the area of federal permitting of projects under the

Clean Water Act. As one commentator has noted,

“(t]he most likely source of a federal nexus for a

private development project is Section 404 of the

Clean Water Act, which requires private parties to

obtain permits from the Army Corps of Engineers

before conducting dredging or filling activities in the

“waters of the United States,” including wetlands,

rivers, creeks, and streams. Sinden, supra, at 177

n.216 (citing 33 U.S.C. § 1344; 33 C.F_R. § 328.3(a)).

But, as this Court is well aware, “[t]he reach of the

Clean Water Act is notoriously unclear.” Sackett v.

12

Environmental Protection Agency, 566 U.S. 120, 132

(2012). Faced with that statutory ambiguity, the

federal agencies charged with the Act's

implementation and enforcement—the Army Corps of

Engineers and the Environmental Protection

Agency—-have pushed their federal permit

jurisdiction to the limit (and, arguably, beyond).

Jonathan H. Adler, Wetlands, Property Rights, and

the Due Process Deficit in Environmental Law, 2012

Cato Sup. Ct. Rev. 139, 142-49 (2012) (tracing the

expansion of federal regulatory jurisdiction under the

Clean Water Act over the last four decades).

The upshot is that landowners risk having the

federal government control the extent to whch they

can use and develop their properties. Federal

regulatory programs, like the Clean Water Act, are

expanding. And if the Fifth Circuit's decision stands,

federal “critical habitat” designations will proliferate

across the country—if not on the Service's own

initiative, then certainly with the prodding of third-

party environmentalist lawsuits demanding

prophylactic designations of hypothetical habitat as a

means of undermining productive use of property.

The market recognizes the cost of that risk as

early as the proposal stage. According to a study

funded by the Service itself, when the Service

proposes to designate undeveloped land as critical

habitat by publishing its property map, the price per

acre of that land decreases by an average of 20

percent. See Jeffrey E. Zabel and Robert W. Paterson,

The Effects of Critical Habitat Designation on Housing

Supply: An Analysis of California Housing

Construction Activity, 46 J. Reg’l Sci. 67, 73 (2006)

13

(noting this particular finding had a p value of only

0.091). That same study found that the supply of

single-family residential housing permits decreases

markedly when critical habitat is proposed—by 23.5

percent in the short run and 37.0 percent in the long

run. See id. at 93.

“The results indicate the proposal of {critical

habitat] acts as a signal that all development in the

[municipality] will be more costly.” Jd. at 68. The

results are “consistent with anecdotal evidence that

cities where [critical habitat] has been designated

tend to become more risk averse and hence more

stringent in issuing new building permits regardless

of whether or not they are for land in [critical habitat)-

designated areas.” Id. at 94 (emphasis added). The

study focused on residential construction permits, but

there is little reason to believe the effects are limited

to that particular land use. And even the Service

recognizes that critical habitat designations have

significant ramifications on property valuation; its

own economic analysis determined the Louisiana

landowners burdened in this case will lose up to $34

million in development opportunities if the

designation remains in place. 77 Fed. Reg. 35118,

35141.

Finally, upholding the Service's power to

designate non-habitat will harm the average

consumer of the goods and services that are the

product of land uses: housing, commercial space,

locally produced food, and other basic goods and

services that are made possible only through the

productive use of land. See, e.g., Andrew J. Turner &

Kerry L. McGrath, A Wider View of the Impacts of

14

Critical Habitat Designation: A Comment on Critical

Habitat and the Challenge of Regulating Small

Harms, 43 Envtl. L. Rep. News & Analysis 10678,

10678 (2013) (‘The designation of critical habitat

under the Endangered Species Act (ESA) can result in

significant and costly consequences for landowners,

industry, government, and other entities—often with

little if any evidence of a commensurate benefit to the

species involved.”).

Consider California’s housing crisis. Working

people are homeless. See Kateri Wozny, Hope for

California’s Housing Crisis?, U.S. News and World

Report (April 3, 2018),

https://www.usnews.com/news/best-states/articles/20

18-04-03/is-there-hope-for-californias-housing-crisis.

Multiple generations of a family share a single house.

Unluckier families must share beds, garages, and

even cars as their sleeping quarters. See Bryan

Schatz, California’s Housing Crisis Is So Bad,

Families Are Squatting Abandoned Homes Just to

Survive, Mother Jones (Mar/Apr. 2018),

https://www.motherjones.com/crime-justice/20 18/04/r

etake-the-house/. State and local politicians are

working frantically to address the housing shortage in

California. See, generally, California State Senate

Majority Caucus, Confronting California’s Housing

Crisis (2018), http://focus.senate.ca.gov/housing?#.

Californians—companies and citizens alike—are

leaving the state. See Conor Dougherty, California

Housing Problems Are Spilling Across Its Borders,

N.Y. Times, Mar. 20, 2018, at B1. The Service's ability

to designate actual habitat already has taken land out

of productive use, including for home-building

purposes. Imagine how the power to designate

15

hypothetical habitat on land that is uninhabitable by

any protected species will undermine efforts in

California to provide housing to its residents. The

harm to the average individual and family in

desperate need of affordable housing in California and

other states cannot be overstated.

Il. HABITAT DESIGNATIONS AFFECT

EVEN PROJECTS THAT DO NOT

REQUIRE FEDERAL ACTION

In addition to the economic cost burdens

described above, a “critical habitat” designation can

impose regulatory burdens on a landowner even when

a project requires no federal action. Specifically, land

that has been designated as “critical habitat” can be

used by state and local governments to justify

significant limits on a _ propertys use and

development. For although federal law may not

compel state and local governments to engage in

Section 7 consultation with the Service or mandate

project modification based on the existence of

federally designated critical habitat, state and local

laws can and do render such critical habitat relevant

to (and often decisive in) the decision whether or the

extent to which to allow a particular use.

The Service is well aware of the significant

influence that its critical habitat designations have on

state and local permit decision-making. That

influence will only grow if the Service’s designation

power is expanded to the extent sanctioned by the

Fifth Circuit in this case. See, e.g., Dashiell Farewell,

Revitalizing Critical Habitat: The Ninth Circuit’s Pro-

Efficiency Approach, 46 Envtl. L. 653, 663 (2016)

16

(“With more parties on notice the more likely it is that

habitat will receive the consideration and protection

it deserves. . . . [A]gencies involved in restoration and

conservation efforts will be more aware of areas worth

their attention.”).

We know the Service is aware of the effect of

designation on local decision-making because the

Service has recognized it in the past. California—one

of the jurisdictions where state and local agencies

regularly rely upon federally designated critical

habitat to limit land use and development, even where

there is no federal nexus—provides a number of

examples.

In 2011, the Service proposed a_ rule

designating critical habitat for the Sonoma County

Distinct Population Segment of the California Tiger

Salamander. Revised Proposed Rule for the

Designation of Critical Habitat for the Sonoma

County Distinct Population Segment of the California

Tiger Salamander, 76 Fed. Reg. 2863 (Jan. 18, 2011).

In analyzing the proposed rule's effect on small

businesses, the Service recognized that, “even in the

absence of a Federal nexus, indirect incremental

impacts fon small businesses] may result if, for

example, a city requests project modifications via the

city’s review under the California Environmental

Quality Act (CEQA), due to the designation of critical

habitat.”® Jd. at 2869.

® CEQA is the California statute that requires state and local

agencies to identify the significant environmental impacts of

their actions and to avoid or mitigate those impacts if feasible.

See Cal. Pub. Res. Code § 21000 et seq.

17

Indeed, the report produced “to assist the

Secretary of the Interior in determining whether the

benefits of excluding particular areas from the

designation outweigh the biological benefits of

including them” found the designation was likely “to

impose losses of over $336 million relating to lost

development opportunities.” See CRA International,

Economic Effects of Critical Habitat Designation for

the California Tiger Salamander in Sonoma County |,

3 (Sept. 23, 2005). Those effects were expected to be

concentrated in the real estate development sector,

particularly where there are few alternative sites for

development or housing is highly rationed. The report

recognized that “[t]he welfare impacts of critical

habitat designations are affected by the nature and

extent of prior interventions such as zoning, urban

growth boundaries and other policies.” See id. at 23;

see also id. at 25-26 (discussing the intersection

between Clean Water Act requirements and the Santa

Rosa Plain Conservation Strategy).

Another example comes from the California

Coastal Commission, the state agency responsible for

regulating and permitting land use and development

along the California coast. See Cal. Pub. Res. Code

§ 30001.5; Ross v. Cal. Coastal Comm'n, 199 Cal. App.

4th 900, 923 (2011) (referring to the agency's

governing statute, the Coastal Act, as “a

comprehensive scheme to govern coastal land use

planning for the entire state”). One of the Coastal

Commission’s strongest weapons against land use and

development is the Coastal Act’s concept of an

“Environmentally Sensitive Habitat Area” (“ESHA”),

which is defined as:

18

any area in which plant or animal life

or their habitats are either rare or

especially valuable because of their

special nature or role in an ecosystem

and which could be easily disturbed or

degraded by human activities and

developments.

Cal. Pub. Res. Code § 30107.5.

Designation of property as “ESHA” is the death

knell of almost any use or development of private

property. That is because only so-called “resource-

dependent uses” of property are allowed in an ESHA.

See id. § 30240(a) (“Environmentally sensitive habitat

areas shall be protected against any significant

disruption of habitat values, and only uses dependent

on those resources shall be allowed within those

areas.”).

How precisely does the Coastal Commission go

about deciding whether an area of land is an ESHA?

It turns out that the California Coastal Commission

assumes property is ESHA—and is_ therefore

undevelopable—if it is or ever has been federally

designated as critical habitat. For instance, when the

Coastal Commission was reviewing a proposed

development of a toll road in Southern California in

what was then mostly undeveloped open space, it

observed that some of that area was federally

designated critical habitat. That WaS enough to

declare the area an undevelopable ESHA and, partly

on that basis, the Commission denied the project:

|Ajithough the Commission is not

limited to designated critical habitats

19

when defining ESHA, the Commission

can rely on critical habitat designations

as one of the components supporting an

As detailed below, the Commission

finds that those areas within the

coastal zone portion of the proposed

project area that are currently or have

previously been specifically designated

as critical habitat by the U.S. Fish and

Wildlife Service (FWS) due to the

recognized and established presence of

federally listed threatened or

endangered species and/or _ the

importance of these areas to the

conservation of threatened or

endangered species also qualify as

environmentally sensitive habitat

areas, ESHA.

California Coastal Commission, Revised Staff Report

and Recommendation on Consistency Certification,

for Consistency Certification No. CC018-07 29

(Feb. 6, 2008) https://documents.coastal.ca.gov/report

s/2008/2/W 8b-2-2008 pdf.

In sum, the effect of a “critical habitat”

designation is not limited to projects requiring federal

action. The designation can also influence and, in

some cases, influence the permit decisions of state and

local agencies, to the detriment of developers,

ranchers, business owners, foresters, and other

property owners. The power to designate even non-

habitat as “critical habitat” is the power to further

20

threaten and erode their ability to use their

properties.

lil. STATES, LOCAL GOVERNMENTS, AND

THE PRIVATE SECTOR ARE PLAYING

AN EVER-GROWING ROLE IN SPECIES

CONSERVATION, MAKING IT

UNNECESSARY—AND UNWISE--TO

EXPAND THE SERVICE’S

DESIGNATION POWER TO INCLUDE

NON-HABITAT WITH NO NEXUS TO A

LISTED SPECIES

The federal government's constitutionally

limited role in species conservation does not leave

endangered and threatened species unprotected.

States are actually quite good at regulating land use

in an effort to protect such species, including on

private property. California has some of the most

burdensome and extensive environmental regulations

in the country. “The primary benefit for enhanced

state responsibility in species conservation derives

from sheer institutional presence and strength on the

land where conservation action is needed.” Kaush

Arha and Barton H. “Buzz” Thompson, Endangered

Species Act and Federalism: Effective Species

Conservation through Greater State Commitment 9

(Woods Inst. for Environment, Stanford L.. Sch. Policy

Paper) https://woods.stanford.edu/sites/default/files/fi

les/Endangered-Species- Act-Policy-Paper-

20050224 pdf.

A chart of 2005 resources devoted to wildlife

conservation in California demonstrates the State’s

presence and strength in that space:

21

CA Fish & USFWS NOAA

Game Dept.| si _-‘Fisheries —

# of 350 20 14

# of 886 168** 52

Total 1,236 188 66

Total 283,158,000 | 32,500,000* | 29,920,000

**

* does not include state or federal biologists stationed at state or

federal wildlife refuges or fish hatcheries as there job entails

managing that parcel of land rather than working with entities

outside the confines of the hatchery or wildlife refuge.

** the number refers to FWS biologists in both California &

Nevada.

*** represents only the appropriated funds to Sacramento Office

of FWS.

Id. at 11-12.

Indeed, “|gliven the familiarity of state

institutions with the ecological, economic, and social

landscape of the state they are better positioned than

the transient representatives of the federal

government to design and implement species

22

conservation programs with better effect and at less

cost.” Id. at 12. That is not to say states are perfect.

See Alejandro E. Camacho, Micheel Robinson-Dorn,

Asena Cansu Yildiz, and Tara Jeegarden, Assessing

State Laws and Resources for Endangered Species

Protection, 47 Envtl. L. Rep. 10838 (Oct. 2017). But

states like California—and regional bodies like the

Western Governors’ Association—can and do put

significant resources toward species conservation. See

Western Governors’ Association, Species Conservation

and Endangered Species Act Initiative,

http://westgov.org/initiatives/species-conservation-

and-esa. “[TJo reach the full potential of our species

conservation efforts states agencies need to take the

lead, as they did in game management, buttressed by

federals laws and resources.” Arha and Thompson at

15; see also John Copeland Nagle, The Original Role

of the States in the Endangered Species Act, 53 \daho

L. Rev. 385, 388 (2017) (“The Congress that enacted

the ESA in 1973 expected that states would play a

lead in conservation efforts because the states already

had substantially more wildlife management

expertise than the federal government. The federal

role, as the Department of the Interior testified at the

time, was ‘an overseeing operation’ to ensure that

states were fulfilling the purposes of the law.”).

The private sector has in recent years begun

playing an ever greater role in species conservation as

well. The American Prairie Reserve, for example,

combines “existing public lands with private resources

and a businesslike approach to securing land.” Pete

Geddes, The Yellowstone of the Future, N.Y. Times,

Dec. 28, 2015, at Al9. The organization has raised

“$100 million from private supporters to purchase 25

23

properties, which are now open to the public for

camping, hiking, and hunting.” Huggins, supra.

American Prairie Reserve has reintroduced bison,

converted existing fences to more migration-friendly

boundaries, and incentivized neighboring farmers and

ranchers to permit wandering wildlife to find a meal

on their land.

The arc of environmental conservation in many

states, like California, is bending toward greater

state, local, and voluntary protection of threatened

and endangered species. Affirming the Fifth Circuit

and blessing the Service’s unfettered ability to

designate private land as critical habitat when that

land is neither habitat nor critical threaten to

undermine that trend and institute greater top-down

controls that serve neither the States, its businesses

and consumers, nor the resource-strapped federal

Service.

CONCLUSION

For the reasons stated above, and those stated

in the briefs of Petitioner and of Respondents Markle

Interests, LLC, et al., Amici urge the Court to reverse

the Fifth Circuit’s decision.

DATED: April 2018

PHILIP A. SANDICK

Alston & Bird LLP

1201 West Peachtree St.

Suite 4900

Atlanta, GA 30309-3424

(404) 881-7000

24

Respectfully submitted,

PAUL Jd. BEARD II

Counsel of Record

MAUREEN F.. GORSEN

Alston & Bird LLP

1121 L Street, Suite 700

Sacramento, CA 95814

(916) 498-3354

Counsel for Amici Curiae