Amicus Curiae Brief — Leslie Salt Co. v. United States

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Supreme Court, U.S,

ey, FILED

No. 90-792 DEC 21 169

JOSEP PF SPANIOL, UR,

IN THE CLERK ;

Supreme Court of the Gnited States

OCTOBER TERM, 1990

LESLIE SALT Co. and CARGILL, INC.,

Petitioners,

UNITED STATES, et al.,

Respondents.

On Petition For Writ Of Certiorari To The

United States Court Of Appeals For

The Ninth Circuit

BRIEF AMICI CURIAE OF THE NATIONAL

ASSOCIATION OF INDUSTRIAL AND OFFICE

PARKS, INTERNATIONAL COUNCIL OF SHOPPING

CENTERS, INC., NATIONAL ASSOCIATION OF HOME

BUILDERS, NATIONAL MULTI HOUSING COUNCIL,

AND NATIONAL REALTY COMMITTEE

IN SUPPORT OF PETITIONERS

ROBERT E. STEINBERG

MICHAEL K. GLENN

(Counsel of Record)

PORTER, WRIGHT, Morris & ARTHUR

1233 20th Street, N.W.

Washington, D.C. 20036

(202) 778-3000

Counsel for Amici Curiae

December 21, 1990

PRESS OF BYRON S. ADAMS, WASHINGTON, D.C. (202) 347-8203

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TABLE OF CONTENTS

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CONCLUSION

. INTERESTS OF AMICI CURIAE ................04.

. SUMMARY OF ARGUMENT ....................cc000

ARGUMENT ..

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TABLE OF AUTHORITIES

CASES Page

Chevron U.S.A., Inc. v. Natural Resources Defense

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P.F.Z. Properties, Inc. v. Train, 393 F. Supp. 1370

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Skidmore v. Swift & Co., 323 U.S. 134 (1944) ..... 13,14

Tabb Lakes, Ltd. v. United States, 715 F. Supp. 726

(E.D. Va. 1988), affd, 885 F.2d 866 (4th Cir.

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United States v. Byrd, 609 F.2d 1204 (7th Cir.

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U.S. CONSTITUTION

Commerce Clause

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STATUTES

Administrative Procedure Act

Clean Water Act

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Table of Authorities Continued

REGULATIONS

Corps of Engineers Regulations

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MISCELLANEOUS

Anthony, Which Agency Interpretations Should Bind

Citizens and Courts?, 7 Yale J. on Reg. 1 (Win-

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IN THE

Supreme Court of the Gnited States

OCTOBER TERM, 1990

LESLIE SALT Co. and CARGILL, INC.,

Petitioners,

UNITED STATES, et al.,

Respondents.

BRIEF AMICI CURIAE OF THE NATIONAL

ASSOCIATION OF INDUSTRIAL AND OFFICE PARKS,

INTERNATIONAL COUNCIL OF SHOPPING CENTERS,

INC., NATIONAL ASSOCIATION OF HOME BUILDERS,

NATIONAL MULTI HOUSING COUNCIL, AND

NATIONAL REALTY COMMITTEE

IN SUPPORT OF PETITIONERS

I. INTRODUCTION

The National Association of Industrial and Office

Parks, International Council of Shopping Centers,

Inc., National Association of Home Builders, National

Multi Housing Council, and National Realty Commit-

tee file this brief amici curiae in support of

Petitioners. The consent of counsel for each of the

parties has been obtained and copies of a letter from

each counsel indicating his consent have been filed

with the Clerk. Amici represent a broad cross-section

of interests affected by the lower court’s decision not

represented by the petitioners or by the particular

property at issue in this case. In addition, Amici’s

brief focuses on an issue not fully presented in the

petition for writ of certiorari, i.e., the statutory con-

cept of ‘‘waters of the United States,”’ including the

statutory purposes and structure, and the importance

of the distinction between the term ‘waters of the

United States’’ and all waters within the United

States.

II. INTERESTS OF AMICI CURIAE

The National Association of Industrial and Office

Parks (NAIOP) is an association formed in 1967 whose

more than 7,000 member companies are developers

and owners, mortgage bankers, contractors and con-

structors, municipalities and development commis-

sions, and numerous other adjunct disciplines

representing the industrial and office park industry.

The International Council of Shopping Centers, Inc.

(ICSC) is the trade association for the shopping center

industry. ICSC has over 28,000 members worldwide.

Its members include developers, retailers, lenders,

owners, managers and others having a professional

interest in the shopping center industry. Its members

represent virtually all of the 35,000 shopping centers

in the United States.

The National Association of Home Builders (NAHB)

represents 160,000 builders and associate members in

all fifty states, the District of Columbia and Puerto

Rico. Its members include not only people and firms

that construct and supply single-family homes but also

apartment, condominium, commercial and industrial

builders, as well as land planners, land developers and

remodelers.

The National Multi Housing Council (NMHC)

represents the interests of the multifamily rental

housing industry. The members of NMHC are en-

gaged in all aspects of the development and operation

of rental housing, including the ownership, building,

financing, management, and conversion to condomin-

ium or cooperative ownership of such properties.

The National Realty “ommittee (NRC) represents

the nation’s leading developers, owners and financiers

of income-producing real property. Its members in-

clude individuals and firms that design, plan, develop,

lease, own, operate and finance income-producing real

property, including office buildings, shopping centers,

industrial buildings, warehouses and apartment build-

ings.

The development and building industries are among

those industries in the nation most directly and ad-

versely affected by the decision of the court below.

If the lower court’s decision is allowed to stand,

NAIOP, ICSC, NAHB, NMHC and NRC members

and many others who plan, finance, and carry out

vital economic development projects for the benefit

of the nation and its people will be severely affected

by the removal of countless environmentally-sound and

economically-viable development sites from the na-

tion’s already limited roster of developable sites.

Section 404 of the Clean Water Act requires those

who wish to discharge dredged or fill material into

“waters of the United States’’ to secure a permit

from the U.S. Army Corps of Engineers (the

“Corps’’). In conjunction with the U.S. Environmental

Protection Agency (the “‘EPA’’), the Corps has pro-

mulgated regulations setting forth criteria to guide

the section 404 permit decisionmaking process (the

“Guidelines”’). 40 C.F.R. Part 230 (1990). The Corps

also has promulgated its own set of section 404 reg-

ulations establishing a detailed “‘public interest’’ bal-

ancing process for determining whether a permit

should be issued or denied.

NAIOP, ICSC, NAHB, NMHC and NRC members

and others who develop large or small scale projects

potentially subject to 404 program prohibitions and

restrictions have long understood both the basic ju-

risdictional scope of the section 404 program and the

particular requirements of the Guidelines, as well as

the Corps’ public interest review regulations. In 1989,

however—at the same time the court below was con-

sidering the section 404 jurisdictional issue raised in

this case—the Corps and EPA were developing a new,

internal Memorandum of Agreement (the ‘‘MOA’’) on

the type and level of ‘“‘mitigation’’ necessary to com-

ply with the Guidelines.

The MOA drastically alters the Corps’ regulatory

approach to permit decisionmaking for ‘‘special

aquatic sites,’ including wetlands. In essence, it re-

scinds and supersedes the Corps’ public interest re-

view regulations. In place of a general balancing

process, only one question need be asked, for ex-

ample, with respect to a proposed project involving

wetlands: Are wetlands involved? If so, issuance of a

permit is presumptively contrary to the public inter-

est. Only if the avoidance of wetlands is ‘“‘impracti-

cable’ will other public interest factors even be

considered. Thus, the MOA could frequently result in

permit denial if wetlands are involved, even if the

proposed development has substantial economic and

social benefits, e.g., low-cost housing, jobs, public

transportation, etc., and even if there are proposed

positive environmental benefits to be gained through

compensatory mitigation.

Although NAIOP, ICSC, NAHB, NMHC and NRC

believe the MOA itself is an unlawful revision of the

established Guidelines and the Corps’ public interest

review regulations, the point to be made here is that—

when combined with the Corps’ new ‘‘migratory bird’’

jurisdictional standard for redefining the scope of the

section 404 program upheld by the court below—in-

dustrial and office parks developers, shopping center

developers, home builders and developers of other in-

come-producing property face the prospect of literally

millions of acres of developable land being placed ‘‘Off

Limits’ by the Corps, no matter how substantial the

benefits of proposed projects on these lands might be.

III. SUMMARY OF ARGUMENT

The court below, in holding that

“(t]he commerce clause power, and thus the

Clean Water Act, is broad enough to extend

the Corps’ jurisdiction to local waters which

may provide habitat to migratory birds and

endangered species... ,

has, in the name of protecting the quality of the

nation’s federal system of navigable waterways, en-

grafted onto the Corps of Engineers’ definition of

“waters of the United States’’ a radically new, im-

plausible, and potentially massive federal intrusion

into the state and local water management and pol-

lution control domain, as well as local land use de-

cisionmaking. Under the court’s reasoning, all man-

made or natural depressions in the land which even

temporarily contain virtually any amount of rainwater

are deemed sufficiently ‘‘wet’’ as to be legally indis-

tinguishable from wetlands, intermittent streams, or

playa lakes, for example, which are subject to regu-

lation by the Corps to the extent they could affect

interstate commerce. Moreover, if any migratory birds

or endangered species may inhabit these rainwater-

wetted depressions, even temporarily, that alone

would provide a sufficient nexus to interstate com-

merce for federal regulatory purposes. In essence,

“waters of the United States’’ would be defined by

the peregrinations of migratory birds, far beyond the

physical, hydrological, and geographical concepts and

limits imbedded in the statute and the established

regulations of the Corps of Engineers. As discussed

below, amici do not believe the statutory concept of

“navigable waters’’ and the Corps’ regulatory defi-

nition of ‘“‘waters of the United States” can or should

be stretched to this extreme or be defined by such

an inherently arbitrary migratory bird standard.

It is accepted law that the term ‘waters of the

United States,’’ as used in the Clean Water Act, is

not limited to traditional notions of navigability.

Courts have upheld its application, for example, to

certain non-navigable, man-made surface water im-

poundments, to certain natural surface depressions

which hold water only on a seasonal basis,-:and to

certain waters which, among other things, provide

habitat to migratory birds or endangered species.

Prior to this case, however, no court has interpreted

“waters of the United States’’ in such a manner as

to sanction federal control over all minimally wet sur-

face depressions whose sole nexus to interstate com-

merce is the sometime potential presence of migratory

birds or endangered species. No court has previously

sanctioned federal regulation of the millions of ad-

ditional acres of man-made and natural surface

depressions that are encompassed by the court’s de-

cision. Such a sweeping expansion of the Corps’ sec-

tion 404 regulatory jurisdiction—to include virtually

all areas where the rain falls and the birds fly (and

come to rest)—is not required or authorized by the

Clean Water Act, nor is it in the public interest.

IV. ARGUMENT

Section 404 of the Clean Water Act prohibits the

discharge of dredged or fill material into ‘‘navigable

waters” without a permit from the Corps of Engi-

neers. 33 U.S.C. § 1844 (1982). The term ‘‘navigable

waters’ is defined in the Act as all “‘waters of the

United States.” 33 U.S.C. § 1362(7) (1982). The Corps,

in turn, has defined ‘‘waters of the United States’’

by regulation to encompass seven general classifica-

tions of waterbodies. 33 C.F.R. § 328.3(a) (1990). The

only such classification relevant to this case—some-

times referred to as the “isolated waters’’ classifi-

cation because these waters are not physically or

hydrologically connected to any other Corps-defined

“waters of the United States’’—is “‘[a]ll other waters

such as intrastate lakes, rivers, streams (including in-

termittent streams), mudflats, sandflats, wetlands [in-

cluding wetlands adjacent to other defined ‘waters of

the United States’], sloughs, prairie potholes, wet

meadows, playa lakes, or natural ponds, the use, deg-

radation or destruction of which could affect interstate

or foreign commerce....” 33 C.F.R. § 328.3(a)3)

(1990).

The court below upheld the Corps’ determination

that the property here in question—petitioners’ aban-

doned salt crystallizers and calcium chloride pits,

which sometimes contain a few inches of collected

rainwater—qualified as ‘‘other waters’? under the

foregoing classification because the property’s use or

alteration could affect interstate birds (it is unclear

whether the endangered mouse involved here also is

an interstate species or how it otherwise could affect

interstate commerce). Thus, the court concluded that

these artificially created, ‘‘seasonal’’ waterbodies,

which sometimes may be inhabited by migratory birds

or endangered species, are subject to the Corps’ sec-

tion 404 regulatory jurisdiction. Amici submit that

such an extreme result is not apparent on the face

of the Clean Water Act or the Corps’ regulations,

and was not within the contemplation of the drafters

of the statute or the regulations.

The statute itself evidences an intent that the term

‘“‘waters of the United States,’’ which the statute does

not define, be construed in light of the statutory pur-

pose to prevent discharges of dredged or fill material

into such waters if they will have an unacceptable

adverse effect on certain specified water quality-re-

lated uses of what for present purposes will be termed

‘federal waters,” 1.e., on the use of such federal

waters for municipal water supplies, shellfish beds

and fishery areas, wildlife, and recreational areas. 33

U.S.C. § 1344(c) (1982). Fundamentally, therefore, if

these specified water quality-related uses of ‘‘federal

waters” are not implicated with respect to a partic-

ular local area or activity, the ‘“‘local waters”’ involved

are not subject to the prohibitions or restrictions of

the Corps’ section 404 program.

Courts interpreting the term ‘‘waters of the United

States’ under the Clean Water Act have affirmed its

reach beyond traditional ‘‘navigable waters’ but, prior

to the case at bar, they have found federal jurisdiction

to exist only in cases involving actual navigable water-

ways, immediate tributaries to navigable waterways,

and wetlands adjacent to navigable waterways. See,

e.g., Utah v. Marsh, 740 F.2d 799, 800-01 (10th Cir.

1984) (navigable lake of 150 square miles); United

States v. Byrd, 609 F.2d 1204, 1205 (7th Cir. 1979)

(2,500 to 3,000 acre navigable lake); P.F.Z. Proper-

ties, Inc. v. Train, 393 F. Supp. 1370, 1380-81 (D.D.C.

1975) (mangrove swamp below mean high water, ad-

jacent to navigable waterway); United States v. Hol-

land, 373 F. Supp. 665, 667, 673, 676 (M.D. Fla. 1974)

(tidal canals and wetlands adjacent to navigable

waters, frequently flooded by tidewater). No court has

previously found federal jurisdiction to exist where

there is no physical or hydrological connection be-

tween a sometimes ‘‘wet”’ parcel of land and the fed-

eral waters and uses thereof which Congress intended

the Clean Water Act to protect.

As a practical matter, virtually all land is some-

times wet, and virtually all land is free to be used

by migratory birds or endangered species. It is evi-

dent from the structure as well as the purpose of the

Clean Water Act, however, that Congress did not

intend to subject to federal regulation virtually all the

land surface within the United States on which rain-

fall is collected or channelized by nature or by man.

Only certain collected and channelized waters were

deemed to be within the proper legal and practical

regulatory reach of federal law. The federal system

of navigable waterways and waterbodies hydrologi-

cally connected thereto—waters ‘‘of’’ or belonging to

the United States—defines the federal regulatory

reach of the Clean Water Act.

In order to protect the quality of ‘federal waters,”’

Congress devised two “point source’ programs to

regulate the discharge into these waters of pollutants

generally (section 402 of the Act, administered by the

United States Environmental Protection Agency

(““EPA’’) and dredged or fill material specifically (sec-

tion 404, administered by the Corps in consultation

with EPA)). To the extent rainfall runoff from diffuse

or “‘non-point’”’ sources reaches federal waters, it also

may be subject to control plans and requirements es-

tablished under section 208 and other provisions of

the Act. Beyond the reach of federal waters and fed-

eral regulatory programs, however, lie millions of

acres of land surface within the United States upon

which rainwater falls and is collected in varying ways

and varying degrees by nature or by man, but which

never reaches the physical, hydrological, or geograph-

ical limits of federal jurisdiction. Protection of the

quality of these previously accepted non-federal waters

is solely within the province of state and local gov-

ernments.

To overcome the federal government’s inability to

regulate those waters and activities which lie beyond

the previously accepted physical, hydrological, or geo-

graphical limits of ‘“‘waters of the United States,” it

is difficult to imagine a more sweeping means of doing

so than to allow the possible visitations of migratory

birds to define ‘“‘waters of the United States.” In

essence, this is what the Corps has proposed and what

the court below has accepted. ‘‘Federal waters’ ju-

risdiction over the land surface would be defined by

the whim of birds in the air. Such a basis for defining

the jurisdictional reach of ‘‘waters of the United

States” is either the epitome of arbitrariness or, per-

haps, a mask for the proposition that virtually all

surface waters within the United States are ‘‘federal

waters’’ subject to the section 404 program. Beyond

its inherent arbitrariness (or a revolutionary attempt

to assert federal control over all surface waters within

the United States), amici see two fundamental prob-

lems with this radically new way of defining ‘waters

of the United States.”’

Substantively, there is no reasonable basis in the

Clean Water Act to conclude that Congress intended

or believed it was necessary for the Corps of Engi-

neers to be the guardian of every pit, pond, and pud-

dle in the nation that might be visited by a transitory

bird or by an interstate traveler in search of an en-

dangered mouse. If such was necessary to achieve the

Act’s purpose or had been Congress’ intention, Con-

gress might as well as have attempted to assert di-

rectly that federal jurisdiction exists over every

waterbody of every description within the United

States. It is evident, however, that Congress had no

such intention.

The fact that Congress intended the Clean Water

Act to protect the use of ‘‘waters of the United

States’ by ‘‘wildlife’’ and to protect ‘‘recreational

areas,’ in addition to water supply and aquatic eco-

system uses of federal waters, does not mean that

the term “‘waters of the United States’’ should be

stretched beyond its otherwise reasonable limits. It

cannot be assumed that Congress had in mind waters

other than those which could affect federal wildlife

preserves and federal recreational areas. More spe-

cifically related to this case, it is even less plausible

that Congress understood, much less intended, that

the word ‘‘wildlife’’ might be interpreted to include

the jurisdictionally-expansive movements of migratory

birds or that “recreational areas’’ might be inter-

preted to encompass the potentially far-reaching per-

egrinations of professional or recreational bird and

endangered species watchers. Perhaps the best evi-

dence that Congress did not contemplate such a result

is the fact that it took EPA and the Corps themselves

some 13 years (from the statute’s enactment in 1972

until 1985) to discover this new, more expansive

method of redefining ‘‘waters of the United States.”

EPA’s 1985 discovery of a migratory bird basis for

expanding federal jurisdiction under section 404, and

its subsequent informal endorsement by the Corps in

1986, leads to the second fundamental problem with

the new migratory bird standard for defining ‘‘waters

of the United States.’’ It is an illegal ‘substantive

rule,” as the Fourth Circuit Court of Appeals so held

in Tabb Lakes, Ltd. v. United States, 715 F. Supp.

726 (E.D. Va. 1988), affd, 885 F.2d 866 (4th Cir.

1989), because it meets all the accepted criteria of a

‘rule’ and was adopted by the Corps in violation of

the notice and comment rulemaking requirements of

the Administrative Procedure Act (‘‘APA’’). 5 U.S.C.

§ 553 (1982).

If there is any doubt about what kind of pro-

nouncement the Corps intended to issue in 1986, it

should be clear from the Corps’ assertions in the court

below, as well as the court’s own conclusion of law,

that the Corps’ new migratory bird jurisdictional

standard is far more than a mere ‘“‘interpretation”’ of

existing law or statement of non-binding Corps policy.

It demonstrably expands, by millions of acres, the

Corps’ claimed jurisdiction to regulate dredge and fill

activities associated with ‘“‘local waters,”’ activities and

waters never previously covered by federal regulatory

requirements.

Even if this Court should find that the Corps’ new

migratory bird jurisdictional standard is a permissible

“interpretation” of the statute and the Corps’ estab-

lished regulations, the question arises as to what de-

gree of judicial deference, if any, should be accorded

the Corps’ interpretation in deciding whether it is

“‘reasonable.’’ Amici submit that, having been adopted

by zwnformal means, 1.e., by a November 1985 Corps

‘“‘Memorandum”’ and by preambular statements ac-

companying the Corps’ November 1986 regulations,

without any involvement by the public generally or

the regulated community in particular, the Corps’ new

“interpretation” should be granted no greater judicial

deference than that expressed by this Court in Skid-

more v. Swift & Co., 323 U.S. 134 (1944):

We consider that the rulings, interpreta-

tions and opinions of the Administrator un-

der this Act, while not controlling upon the

courts by reason of their authority, do con-

stitute a body of experience and informed

judgment to which courts and litigants may

properly resort for guidance. The weight of

such a judgment in a particular case will de-

pend upon the thoroughness evident in its

consideration, the validity of its reasoning,

its consistency with earlier and later pro-

nouncements, and all those factors which give

it power to persuade, if lacking power to

control.

Id. at 140. See generally, Anthony, Which Agency

Interpretations Should Bind Citizens and Courts?, 7

Yale J. on Reg. 1 (Winter 1990) (in which Professor

Anthony compares Skidmore, which involved agency

“interpretative bulletins’ and informal agency rul-

ings, with Chevron U.S.A., Inc. v. Natural Resources

Defense Council, 467 U.S. 837 (1984), which involved

an agency interpretation made in the context of

rulemaking, and discerns a frequently missing ‘‘step’’

in the judicial consideration of whether an agency has

reasonably interpreted an issue on which the statute

is either silent or ambiguous, 7.e., whether the agen-

cy’s interpretation ‘“‘in the format it uses’” may be

given binding effect.)

The Clean Water Act might well be considered

somewhat ambiguous with respect to the intended

meaning of ‘‘waters of the United States.” The stat-

ute’s interchangeable use of ‘“‘navigable waters’’ and

“waters of the United States,’’ however, strongly in-

dicates a close jurisdictional tie between ‘‘waters of

the United States” and the federal navigational ser-

vitude under the Commerce Clause. U.S. Constitution

art. I, § 8, cl. 3. As previous courts have ruled, how-

ever, ‘“‘waters of the United States’? does encompass

certain other waters not historically deemed to be

“navigable waters.’ For that reason, the term ‘‘fed-

eral waters,’’ as used previously in this brief, may be

more appropriate when referring to those waters sub-

ject to federal jurisdiction under the Clean Water Act.

It seems clear, in any event, that ‘‘waters of the

United States’’ (or ‘‘federal waters’’) is not the same

as all waters within the United States.

If the Corps’ intent, or the effect of the Corps’

adoption of the new migratory bird jurisdictional

standard, is to establish ‘“‘federal waters’ jurisdiction

over virtually all waters within the United States—

which is the practical consequence of the court’s de-

cision below, even if it was not the Corps’ actual

intention—there should be no question regarding its

status as a ‘‘substantive rule.” The effect of changing

“of’’ to “within” is to shift water pollution control,

not to mention associated land use decisionmaking,

almost entirely into the federal domain. Such a rev-

olutionary change surely cannot be allowed without

a clear Congressional directive (assuming such would

be constitutionally permissible), much less be allowed

by administrative agency fiat.

V. CONCLUSION

The lower court’s ruling, which allows the Corps

to expand its section 404 regulatory jurisdiction to

include ‘‘local waters which may provide habitat to

migratory birds and endangered species,’ is not au-

thorized by or necessary to achieve the purpose of

the section 404 program. The decision of the court

below, moreover, ignores the structure of the Clean

Water Act and its essential division of authority and

responsibility as between the federal government and

state and local governments. Beyond the established

and generally well understood physical, hydrological,

and geographical limits of federal jurisdiction over

navigable waters and their adjunctive waters, the

lower court has approved a revolutionary and ex-

tremely arbitrary new criterion for defining ‘“‘waters

of the United States’’ by reference to the possible

flight plans and ground-level visitation choices of mi-

gratory birds. Such a jurisdictional standard, if not

the epitome of arbitrariness, can only mean that the

federal government now claims jurisdiction over vir-

tually all waters of every description within the

United States.

For the foregoing reasons, in addition to those set

forth in the Petition of Leslie Salt Co. and Cargill,

Inc., amici curiae National Association of Industrial

and Office Parks, International Council of Shopping

Centers, Inc., National Association of Home Builders,

National Multi Housing Council, and National Realty

Committee respectfully urge the Court to grant

certiorari and reverse the decision of the Court of

Appeals.

Respectfully submitted,