Appendix — Water Works & Sewer Board of Birmingham v. Department of the Army, Corps of Engineers

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APPENDIX A — OPINION OF THE UNITED STATES

COURT OF APPEALS FOR THE ELEVENT H CIRCUIT

DATED AND FILED OCTOBER 13, 1998

IN THE UNITED STATES COURT OF APPEALS

FOR THE ELEVENTH CIRCUIT

No. 97-6882

D.C. Docket No. CV95-PT-2956-S

WATER WORKS & SEWER BOARD OF THE CITY OF

BIRMINGHAM, an Alabama public corporation,

Plaintiff-Appellant,

versus

UNITED STATES ARMY CORPS OF ENGINEERS, THE,

a federal agency; CITY OF BESSEMER, ALABAMA, THE,

a municipal corporation, et al.,

Defendants-Appellees.

Appeal from the United States District Court for the

Northern District of Alabama

(October 13, 1998)

Before HATCHETT, Chief Judge, BIRCH, Circuit Judge,

and KEITH*, Senior Circuit Judge.

—_—

* Honorable Damon J. Keith, Senior U.S. Circuit Judge for

the Sixth Circuit, sitting by designation.

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Appendix A

PER CURIAM: AFFIRMED. See 11th Cir. R. 36-1.'

“Costs taxed against plaintiff-appellant.”

Entered: October 13, 1998

For the Court: Thomas K. Kahn, Clerk

By: s/ Matt Davidson

Deputy Clerk

ISSUED AS MANDATE: JUNE 10 1999

1. 11th Cir. R. 36-1 provides:

When the court determines that any of the following

circumstances exist:

(a) the judgment of the district court is based

on findings of fact that are not clearly

erroneous;

(b) the evidence in support of a jury verdict

is sufficient;

(c) the order of an administrative agency is

supported by substantial evidence on the

record as a whole;

(d) a summary judgment, directed verdict,

or judgment on the pleadings is

supported by the record;

(e) the judgment has been entered without a

reversible error of law;

and an opinion would have no precedential value, the

judgment or order may be affirmed or enforced without

opinion.

lammntemeimmeisameseisintiiataiitiaii ital

3a

APPENDIX B — MEMORANDUM OPINION OF THE

UNITED STATES DISTRICT COURT FOR THE

NORTHERN DISTRICT OF ALABAMA, SOUTHERN

DIVISION DATED OCTOBER 22, 1997

THE WATER WORKS & SEWER BOARD OF

THE CITY OF BIRMINGHAM, Plaintiff,

v.

UNITED STATES DEPARTMENT OF ARMY,

CORPS OF ENGINEERS, et al., Defendants.

No. CV 95-PT-2956-S.

United States District Court,

N.D. Alabama,

Southern Division.

Oct. 22, 1997.

s * *

Memorandum Opinion

PROPST, Senior District Judge.

This cause comes on to be heard on a motion for

summary judgment filed by defendant City of Bessemer

(“Bessemer”) on July 30, 1997; a motion for summary

judgment filed by defendants United States Army Corps of

Engineers, Togo D. West, Jr., Lt. Gen. A. E. Williams, and

Col. William S. Vogel (collectively, “Corps”) on July 30,

1997; and a motion to allow limited discovery and a hearing,

and cross motion for summary judgment filed by the plaintiff

Water Works & Sewer Board of the City of Birmingham

(“Water Works”) on August 29, 1997. The issues raised by

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Appendix B

Bessemer and the Corps in their separate motions are

substantially the same. The parties’ dispute concerns the

validity of a Department of the Army Permit for work in

“waters of the United States” issued by the Corps on March

17, 1997. The plaintiff contends that the permit was

improperly issued (1) because the Corps failed to have a

requested hearing on the validity of the permit in violation

of the Corps’ regulations, the statutes governing the Corps’

permitting process and the Due Process Clause of the Fifth

Amendment; (2) because the Corps failed to adequately

consider the substantial adverse effects of the permitted

activity on the public interest; (3) because the Corps

erroneously failed to require preparation of an environmental

impact statement in violation of the National Environmental

Policy Act, 42 U.S.C. § 4321, et seq.; and (4) because the

permitted activity of Bessemer will not comply with the

Environmental Protection Agency’s Guidelines for

Specification of Disposal Sites for Dredged or Fill Material,

40 C.F.R. § 230.1, et seq. The defendants contend that the

Corps properly permitted a prospective intake structure and

pipeline intended to provide water for an independent water

treatment and distribution system in Bessemer and that its

decision is properly supported by the administrative record.

The plaintiff asserts that it should be granted an opportunity

for discovery outside of the administrative record and that it

should be granted a hearing on the basis of the discovery

results.

Facts

The Water Works & Sewer Board of the City of

Birmingham (“Water Works”), originally the Birmingham

Waterworks Company, is an Alabama public corporation that

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Appendix B

was initially “chartered for public service by legislative act

approved February 13, 1885. Sess. Acts 1884-85, p. 415.”

Birmingham Waterworks Co. v. City of Birmingham, 58 So.

204, 204, 176 Ala. 301, 301 (Ala.1912); State ex rel.

Weatherly v. Birmingham Waterworks Co., 64 So. 23, 26-

27, 185 Ala. 388 (1913). The purpose of the Water Works,

as first stated, was to “greatly promote the health and comfort

of the citizens of Birmingham, in Jefferson county, Alabama,

and its suburbs, to have an ample supply of good and pure

water....” Birmingham Waterworks Co. v. City of

Birmingham, 58 So. at 204. The Water Works describes itself

as being “the largest water utility in the State of Alabama,

serving approximately 25 million gallons per day of raw

water to industrial customers, and approximately 108

[million gallons per day] of potable water to approximately

one million people... .” Plaintiff's Brief in Response to

Bessemer’s Motion for Summary Judgment at 2-3; also,

Administrative Record at 209. The Water Works has four

sources of water: the Cahaba River, the Mulberry Fork of

the Black Warrior River, the Sipsey Fork of the Black

Warrior River and Inland Lake.

The City of Bessemer has, for forty-six years, purchased

water from the Water Works to sell to its residents. At

present, ten to thirteen million gallons of water per day are

purchased by Bessemer from the Water Works for residential,

agricultural and industrial purposes. Bessemer has, however,

grown weary of its reliance on the Water Works and seeks

to develop its own water supply, treatment and distribution

system.’ To develop the independent water system, Bessemer

1. The decision to cancel the contract with the Water Works

and build an independent water system was made after the Water

Works threatened Bessemer with a five percent rate hike.

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Appendix B

would build an intake structure on the Black Warrior River

at Taylor’s Ferry, downstream from Bankhead Lake; a water

treatment plant at which the withdrawn water would be made

potable; and an associated thirty-inch diameter pipe that

would connect the intake structure to the treatment plant and

the treatment plant to the water distribution system of

Bessemer. At full operating capacity, the intake system

would be capable of removing twenty-five million gallons

of water per day from the Black Warrior River.” From the

treatment plant, the water would be channeled through pre-

existing pipes to end-line customers.

On June 2, 1995, Bessemer submitted an application for

a Corps of Engineers’ permit pursuant to section 10 of the

Rivers and Harbors Appropriation Act of 1899 (33 U.S.C.

§ 403) and section 404 of the Clean Water Act (33 U.S.C.

§ 1344) to construct the water intake structure on the Black

Warrior River and associated pipeline crossings. On June

28, 1995, the Army Corps of Engineers (“Corps’’) issued

public notice of the permit application and provided a thirty

day period ending on July 28, 1995, within which comments

2. It should not be inferred from this that twenty five million

gallons per day would be drawn from the Black Warrior River

through the intake structure. Although the court does not intend to

supplement to the record, it notes that use may, in fact, go down.

Evidence submitted by the Water Works and addressed by the Corps

indicates that initially at least, the cost to Bessemer of producing

water than it would be greater if the water was purchased from

Birmingham and resold. Although the market for water use is

relatively inelastic, the higher price needed to cover costs of

production (even if Bessemer chooses not to set price to maximize

profits) might reduce the amount of gallons consumed.

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Appendix B

on the proposed project were to be submitted. The Corps

received comments from various state, local and federal

agencies, in addition to private individuals. On July 28, 1995,

the Corps extended the comment period in response to a

request for an extension of time and for a public hearing by

the Water Works. On August 11, 1995, the Water Works

submitted “extensive” comments setting forth its objections

to the permit and reiterated its request for a hearing.

On October 30, 1995, the Corps formally denied the

Water Works’ request for a public hearing, stating that “a

public hearing would not provide any additional information

which would assist in making a final decision in this request

for a permit.” Administrative Record (“A.R.”’) at 308. On

the next day, the Corps issued a Statement of Findings, which

included an environmental assessment and an evaluation of

compliance with the EPA’s Clean Water Act Guidelines and

which addressed the comments received, including,

allegedly, those of the Water Works. On November 13, 1995,

the Corps issued a permit to Bessemer authorizing

construction of the water intake structure and associated

pipeline. Three days later, the Water Works filed suit in this

court seeking review of the Corps’ action.

Around March 1, 1996, the Corps suspended its permit

to consider in more depth the impacts associated with the

intake structure and the pipeline route proposed by Bessemer.

At the same time, the parties moved jointly to stay the case

while such consideration was taking place. On March 4,

1996, the court granted the stay. According to the Corps,

while the stay was in effect, it considered issues raised by

the Water Works, as contained in the affidavits of Bruce

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Appendix B

Schwenneker and Gene Hanson that were submitted to the

court in February 1996.

A year after the stay went into effect, on March 17, 1997,

the Corps issued a revised Statement of Findings on the

permit application, accompanied by an environmental

assessment and an evaluation of compliance with the EPA’s

Clean Water Act Guidelines. On the same day, it reissued

Bessemer’s permit. The issues raised in the various motions

are now before the court.

Contentions & Analysis

The court assumes, without deciding, that the Water

Works has standing to raise its various complaints. It may

have standing as to some and not as to others.

I. THE BENEFIT OF A HEARING.

The plaintiff's first contention is that it was denied a

hearing in violation of (1) the regulations issued by the Corps

governing the circumstances under which a hearing is to be

granted; (2) the Administrative Procedure Act and the

relevant sections of the statutes under which the Corps’

authority to regulate is described; and (3) Fifth Amendment

due process, even if the Corps in fact complied with the

regulations and statutes. The defendants dispute all of these

arguments.

A. Compliance with the Regulations.

The Corps’ regulations elucidating the criteria for the

grant of a public hearing, 33 C.F.R. § 327.4, state:

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Appendix B

(a) A public hearing will be held in connection

with the consideration of a DA [Department of

the Army] permit application or a Federal project

whenever a public hearing is needed for making

a decision on such permit application or Federal

project. In addition, a public hearing may be held

when it is proposed to modify or revoke a permit.

(See 33 CFR 325.7).

(b) Unless the public notice specifies that a public

hearing will be held, any person may request, in

writing, within the comment period specified in

the public notice on a DA permit application or

on a Federal project, that a public hearing be held

to consider the material matters at issue in the

permit application or with respect to Federal

project. Upon receipt of any such request, stating

with particularity the reasons for holding a public

hearing, the district engineer may expeditiously

attempt to resolve the issues informally.

Otherwise, he shall promptly set a time and place

for the public hearing, and give due notice thereof,

as prescribed in § 327.11 of this Part. Requests

for a public hearing under this paragraph shall be

granted, unless the district engineer determines

that the issues raised are insubstantial or there is

otherwise no valid interest to be served by a

hearing. The district engineer will make such a

determination in writing, and communicate his

reasons therefor to all requesting parties.

Comments received as form letters or petitions

may be acknowledged as a group to the person or

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Appendix B

organization responsible for the form letter or

petition.

(c) In case of doubt, a public hearing shall be

held. ...

(d) In fixing the time and place for a hearing, the

convenience and necessity of the interested public

will be duly considered.

The Eleventh Circuit has interpreted the Corps’ regulations

to mean that the grant of a public hearing by the Corps is

discretionary.

The applicable regulations provide the Corps

discretion to hold hearings on permit applications

on an “as needed” basis. 33 C.F.R. § 327.4. If the

Corps determines that it has the information

necessary to reach a decision and that there is “no

valid interest to be served by a hearing,” the Corps

has the discretion not to hold one. Id. § 327.4(b).

Fund for Animals v. Rice, 85 F.3d 535, 545 (1 1th Cir.1996).

In reviewing whether an agency’s decision to decline public

hearing request comports with the agency’s regulations, an

arbitrary and capricious standard is to be employed by the

court. Id.

In considering [whether an agency’s action is

arbitrary and capricious] the Court may not

substitute its judgment for that of the agency and

can set aside an agency’s decision only if the

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Appendix B

agency relied on improper factors, failed to

consider important relevant factors, or committed

a clear error of judgment that lacks a “rational

connection between the facts found and the choice

made.” Motor Vehicle Mfrs. Ass’n, Inc. v. State

Farm Mut. Auto. Ins. Co., 463 U.S. 29, 43, 103

S.Ct. 2856, 2866, 77 L.Ed.2d 443 (1983) (internal

quotations and citations omitted); Preserve

Endangered Areas of Cobb’s History, Inc. v.

United States Army Corps of Engineers, 87

F.3d 1242, 1246 (11th Cir.1996); Florida

Manufactured Hous. Ass’n, Inc. v. Cisneros, 53

F.3d 1565, 1572 (11th Cir.1 995).

While we must conduct a “searching and careful”

inquiry to assess whether the decision bears the

requisite connection to the relevant facts, our

ultimate standard of review is narrow and

deferential to the agency’s conclusions. Citizens

to Preserve Overton Park, Inc. v. Volpe, 401 U.S.

402, 416, 91 S.Ct. 814, 823-24, 28 L.Ed.2d 136

(1971). Agency action must be presumed valid

and rejected only for “ ‘substantial procedural or

substantive reasons ... not simply because the

court is unhappy with the result reached.’ ”

Manasota-88, Inc. v. Thomas, 799 F.2d 687, 691

(11th Cir.1986) (quoting Vermont Yankee

Nuclear Power Corp. v. Natural Resources

Defense Council, Inc., 435 U.S. 519, 558, 98 S.Ct.

1197, 1219, 55 L.Ed.2d 460 (1978)).

Arango v. United States Department of the Treasury, 115

F.3d 922, 928 (11th Cir.1997).

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Appendix B

The Water Works argues that it properly requested in

writing a public hearing within the time period prescribed

by the regulation and that it clearly elucidated its reasons

for requesting the hearing. In its letter to the Corps, the Water

Works detailed concerns related to public needs and welfare,

the economic impact of the project, water supply and

conservation, property rights and practicable alternatives to

the project. In addition, the Water Works requested a public

hearing:

to more specifically consider the following

matters including, but not limited to:

conservation, economics, aesthetics, general

environmental concerns, wetlands, historic

properties, fish and wildlife values, land use,

navigation, shore erosion and accretion,

recreation, water supply and conservation, water

quality, energy needs, safety, food and fiber

production, mineral needs, property ownership

considerations and general welfare needs of the

public. In addition, this hearing is requested so

that the public and in particular the citizens and

customers of Bessemer and the customers of the

[Water Works] Board, will have the opportunity

to respond to the issues set out above that have a

direct effect on economy and lifestyle.

A.R. at 218. In short, the Water Works raised, in addition to

particularized reasons for a public hearing, the laundry list

itemized in 33 C.F.R. § 320.4(a)(1). Characterizing its listing

of concerns as satisfaction of a “threshold burden,” the

plaintiff argues that “the burden” shifted to the Corps to either

‘

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Appendix B

informally resolve its concerns, deny the hearing in a writing

stating why a hearing would be unhelpful, or grant a hearing.

Maintaining that the Corps failed to properly pursue the first

two options, the Water Works reasons that the Corps was

required to grant a hearing.’

3. Characterizing the obligations of the Water Works and the

Corps as a set of demonstrative “burdens” is questionable. The use

of the term “burden” in this context implies that the party who carries

the obligation must perform to the demonstrative satisfaction of some

adjudicator. This is not the case. A petitioner, as a precursor to a

Corps’ hearing determination, must merely request a hearing in an

appropriate form. Once that antecedent condition is satisfied, the

Corps is obligated either (1) to resolve the issues raised informally,

(2) to deny a hearing in writing, stating reasons why the hearing

would be unhelpful or (3) to grant the hearing, where such would

be of aid. Although describing the Corps as having a burden to show

that a hearing is unhelpful, it makes little sense to state that it has a

“burden” of granting a hearing — a hearing is either properly granted

or it is not.

The point is grammatical. The language used by the Water

Works implies that action by the Corps is to be taken in anticipation

of litigation rather than as executing a statutory duty. However, the

procedures followed by the Corps are not followed as pre-litigation

behavior, but are obligations meant to insure reasoned determinations

by the Corps. The court is, therefore, not required to find that the

Corps satisfied or failed to satisfy some demonstrative burden.

Instead, it is required only to determine whether the Corps carried

out its statutory or regulatory obligations in a non-arbitrary and non-

capricious manner. It is only where an agency fails to perform its

procedural and substantive obligations — such as where it fails to

give genuine reasons for a decision where those reasons are due —

that an agency’s behavior will be arbitrary and capricious. Reasons,

however, are not and are not expected to be, proof.

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Appendix B

The Water Works first asserts that the Corps did not

attempt to resolve the matter informally. It next avers that

the Corps’ written denial of a hearing was given on an

insufficient basis because the Corps’ decision “simply set

forth the Corps’ rationale for justifying the ultimate issuance

of the permit to Bessemer . . .” The defendants answer that

the Corps concluded that the Water Works sufficiently

articulated its concerns to the Corps in its comments and

informal discussions and that, therefore, no additional

information was required.*

In its written statement denying a hearing, the Corps

District Engineer addressed the Water Works’ reasons for

the grant of a public hearing:

The U.S. Army Corps of Engineers jurisdiction

in this permit application relates to the

construction of the water intake structure in

navigable waters of the U.S. The primary focus

of our evaluation will be on the direct impacts of

the structure (e.g. navigation, water quality,

threatened/endangered species, and cultural

resources). Our regulations at 33 CFR 320.4(m)

and guidance contained in Regulatory Guidance

Letter 85-6 states that the primary responsibility

for water allocation rests with the states.

In response to the public notice[,] letters of no

objection or authorization were received from the

4. It apparently found the laundry list, on the other hand,

insufficiently ‘particular’ as required under 33 C.F.R. § 327.4 to

merit an extended response.

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Appendix B

U.S. Fish and Wildlife Service, National Marine

Fisheries Service, Alabama Department of

Conservation and Natural Resources, Alabama

Department of Environmental Management,

Alabama State Docks, and the Alabama Historical

Commission. Coordination with these agencies

indicates that the proposed project will not

adversely impact fish and wildlife, threatened and

endangered species, properties on or eligible for

the National Register of Historic Places,

navigation, and water quality.

The decision of the City of Bessemer to seek its

own water supply and the consequences of the

decision (higher prices, and reliability) are the

responsibility of the locally elected officials, not

the Corps. Policy at 33 CFR 320.4(q) states that

“... It will generally be assumed that appropriate

economic evaluations have been completed, the

proposal is economically viable, and is needed in

the market place”.

Although the granting of Bessemer’s requested

permit will provide a new-water withdrawal point

on the Black Warrior River, it should not increase

the demand for water in the short term. The water

to be withdrawn by Bessemer is currently being

withdrawn by the [the Water Works] at other

locations and sold to Bessemer. If [the Water

Works] developed new customers to replace

Bessemer, additional demands on water resources

would result. It is estimated that up to 70 per cent

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Appendix B

of the water withdrawn by Bessemer would be

returned to Black Warrior River as treated waste

water thus reducing the net withdrawal to 7.5

[million gallons per day].

The proposed Bessemer intake is downstream of

all the [Water Works] intakes and will probably

not impact the [Water Work’s] withdrawal except

during droughts when the Bankhead Lake level

is low. Future increases in water withdrawals will

likely impact navigation depths during droughts,

however, the allocation of water for multi-purpose

use is primarily a State issue. If navigational

servitude is impaired, Federal authority to protect

navigation preempts the State’s right to allocate

water use.

A.R. at 307-08. Based upon his analysis of the concerns

raised by the Water Works, the district engineer concluded

that sufficient data existed with respect to the issues raised

by the Water Works such that no hearing would be necessary.

Given the reasons stated and the factors considered, the

district engineer reasonably concluded that no additional

information would be useful in evaluating the

appropriateness of granting a permit to Bessemer.

The Water Works insists that the affidavit later filed by

Dr. Bruce W. Schwenneker (which was addressed by the

Corps in its final permitting decision) demonstrates that a

public hearing was needed to flush out the concerns stated

by the Water Works. The Corps needed only to consider

whether the issues raised by the party requesting a public

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Appendix B

hearing were sufficiently undefined as to require that hearing.

On the basis of the concerns stated by the Water Works in

its letter, the Corps, within its appropriate range of discretion,

determined that the problems were adequately presented and

did not require public hearing for additional statement and

clarification in accordance with its regulations. The decision

to deny a public hearing was neither arbitrary nor capricious.

B. Statutory Hearing Requirements.

The Water Works avers that, even supposing the refusal

to hold a public hearing were not a violation of the Corps’

regulations on the grant of public hearings, the Corps’ refusal

nonetheless violated the Administrative Procedure Act and

the Due Process Clause of the Fifth Amendment. On the issue

of whether a hearing determination that conforms to the

regulations complies with section 5 of the Administrative

Procedure Act, section 10 of the Rivers and Harbors Act of

1899 and section 404 of the Clean Water Act, no case directly

addressing the issue has emerged.’ However, cases that have

broached the issue lead this court to the conclusion that the

denial of a hearing was not violative of the above-listed

statutes. The Fifth Circuit Court of Appeals commented in

Buttrey v. United States, 690 F.2d 1170, 1176 (Sth Cir.1982),

that a public hearing “ ‘usually means a speechmaking

hearing rather than a (trial-type) hearing with a determination

on the record.’ 2 K. DAVIS, ADMINISTRATIVE LAW

TREATISE § 12:7, at 434 (2d ed.1979).” See also Taylor v.

District Engineer, 567 F.2d 1332, 1338 (Sth Cir.1978). The

5. Most cases on involve the denial of a formal hearing, not a

public hearing.

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Appendix B

Fifth Circuit also noted that, in general, the purpose of the

speechmaking hearing for federal agencies was to gain input

to assist the agency in making decisions, id., implying that

if an agency found that sufficient input was had from

comments submitted a public hearing was unnecessary. “A

Federal agency is not required to conduct public hearings

before making a threshold determination as to the need for

an EIS so long as members of the public are given the

opportunity to submit facts which might bear upon the agency

decision.” Sierra Club v. Alexander, 484 F.Supp. 455, 471

(N.D.N.Y.1980) (citing WATCH (Waterbury Action, etc.)

v. Harris, 603 F.2d 310, 326 n. 36. (2d Cir.1979)) aff'd 633

F.2d 206 (2d Cir.1980). See also AJA Assoc. v. Army Corps

of Engineers, 817 F.2d 1070, 1073-74 (3d Cir. 1987). In Fund

for Animals, Inc. v. Rice, 85 F.3d 535, 545 (11th Cir.1996),

the Eleventh Circuit Court of Appeals implied that the

opportunity for public hearing crafted by the Corps in its

regulations adequately complied with the Clean Water Act.

The CWA mandates an “opportunity for public

hearings.” See 33 U.S.C. § 1344(a). However, the statute

does not state that the Corps itself must hold its own public

hearings regardless of how many other hearings have been

held on a project. The applicable regulations provide the

Corps discretion to hold hearings on permit applications on

an “as needed” basis. 33 C.F.R. § 327.4. If the Corps

determines that it has the information necessary to reach a

decision and that there is “‘no valid interest to be served by a

hearing,” the Corps has the discretion not to hold one. Id.

327.4(b).

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Appendix B

C. Due Process.

In resolving whether the Corps decision to deny a hearing

violated due process, this court is to apply a de novo standard

of review. Summary judgment is appropriate only if this court

concludes that no genuine issue of material fact exists and

that the moving party is entitled to judgment as a matter of

law. Fed.R.Civ.P. 56(c). See Anderson v. Liberty Lobby,

Inc., 477 U.S. 242, 249, 106 S.Ct. 2505, 2511, 91 L.Ed.2d

202 (1986); Celotex Corp. v. Catrett, 477 U.S. 317, 322,

106 S.Ct. 2548, 2552, 91 L.Ed.2d 265 (1986). The party

seeking summary judgment bears the initial responsibility

of informing this court of the grounds for its motion, and

identifying those portions of the record, pleadings,

depositions, answers to interrogatories, admissions on file,

and any affidavits that it believes prove the absence of a

genuine issue of material fact. Id. at 323, 106 S.Ct. at 2552-

53. Once the moving party has met this burden, the

nonmoving party “must produce evidence that shows there

exists a genuine issue of material fact.” Cottle v. Storer

Communication, Inc., 849 F.2d 570, 575 (11th Cir.1988).

Rule 56(e) requires the nonmoving party to go beyond the

pleadings and by affidavits, or by the depositions, answers

to interrogatories, admissions on file and, in this case, the

administrative record designate specific facts showing the

presence of a genuine issue for trial. Celotex, 477 U.S. at

324, 106 S.Ct. at 2553. The court may consider the offered

“pleadings, depositions, answers to interrogatories, and

admissions on file, together with the affidavits, if ee

in deciding whether to grant or deny a summary judgment

motion. Fed.R. Civ. P. 56(c). In resolving whether a given

factual dispute requires submission to a jury, the court must

20a

Appendix B

view the presented evidence through the prism of the

substantive evidentiary burden. Anderson, 477 U.S. at 254-

55, 106 S.Ct. at 2513-14. The court, however, must avoid

weighing conflicting evidence for probity or making

credibility determinations. Welch v. Celotex Corp., 951 F.2d

1235, 1237 (11th Cir.1992).

With respect to whether the denial of a public hearing is

consistent with modern understandings of Fifth Amendment

Due Process, the Fifth Circuit Court of Appeals has held, in

a case involving an earlier version of the Corps regulations

regarding public hearings, that “the procedures set forth in

the regulations of the Corps easily satisfy the requirements

of due process.” Taylor v. District Engineer, 567 F.2d 1332,

1338 (Sth Cir.1978).° Any decision comporting with those

regulations would, therefore, satisfy due process, even if the

resulting decision was substantively incorrect.

In the absence of a fundamental interest, to be entitled

to due process protection, a plaintiff must have a protected

life, liberty or property interest, the deprivation of which is

to be afforded due process. Logan v. Zimmerman Brush Co.,

455 U.S. 422, 428, 102 S.Ct. 1148, 1153-54, 71 L.Ed.2d

265 (1982); Zipperer v. City of Fort Myers, 41 F.3d 619,

623 (11th Cir.1995). Two potential sources exist for the

Water Works’ claimed entitlement to due process: (1) the

regulations stating that interested parties are entitled, in

certain circumstances, to a hearing and (2) the Water Works’

6. Decisions of the Fifth Circuit Court of Appeals made prior

to the circuit split are binding as precedent upon this court unless

otherwise overruled by the Eleventh Circuit Court of Appeals.

21a

Appendix B

riparian rights and economic interests in the outcome of the

permitting decision. The first basis for an interest, that the

Statute or regulations entitle it to a hearing in certain

circumstances, fails, as there is no protected interest in a

procedural right. In Olim v. Wakinekona, 461 U.S. 238, 250-

51, 103 S.Ct. 1741, 1748-49, 75 L.Ed.2d 813 (1983), the

Supreme Court stated:

[a]s the United States Court of Appeals for the

Seventh Circuit recently stated in Shango v.

Jurich, 681 F.2d 1091, 1100-1101 (1982), “fa]

liberty interest is of course a substantive interest

of an individual; it cannot be the right to demand

needless formality.” Process is not an end in itself.

Its constitutional purpose is to protect a

substantive interest to which the individual has a

legitimate claim of entitlement. . . . The State may

choose to require procedures for reasons other

than protection against deprivation of substantive

rights, of course, but in making that choice the

State does not create an independent substantive

right... .

See also Merritt v. Broglin, 891 F.2d 169, 172 (7th

Cir.1989)(“State created procedural rights are insufficient

to create a substantive liberty interest.”). The interest of the

Water Works in the regulation and statute is a mere right to

procedure, i.e., a hearing, created with the purpose of

protecting the substantive interests of the permit applicant

and the public. However, the interests of the public, and in

this case the Water Works, being protected by the Corps’

procedures are far broader than the interests that the Corps

is constitutionally required to protect through its procedures.

22a

Appendix B

The deprivations of substantive interests —- economic

loss and infringement of riparian rights —- which the Water

Works maintains will occur if a hearing is denied are indirect

consequences of a decision by the Corps to permit Bessemer

to build the intake structure, pipeline and water treatment

plant. Indirect deprivations of interests are, however, outside

of the purview of the due process clause. O’ Bannon v. Town

Court Nursing Center, 447 U.S. 773, 787, 100 S.Ct. 2467,

2476, 65 L.Ed.2d 506 (1980); Dumas v. Kipp, 90 F.3d 386,

391 (9th Cir. 1996); and Rivers v. Schweiker, 684 F.2d 1144,

1158 (Sth Cir.1982).’

7. The court is uncertain whether a municipal corporation 1s

entitled to the due process protections of the Fifth Amendment at

all. In State of South Carolina v. Katzenbach, 383 U.S. 301, 323-

24, 86S.Ct. 803, 815-16, 15 L.Ed.2d 769 (1966), the Supreme Court

Stated:

The word ‘person’ in the context of the Due Process

Clause of the Fifth Amendment cannot, by any

reasonable mode of interpretation, be expanded to

encompass the States of the Union, and to our

knowledge this has never been done by any court. See

International Shoe Co. v. Cocreham, 246 La. 244, 266,

164 So.2d 314, 322, n. 5, cf. United States v. City of

Jackson, 318 F.2d 1, 8 (Sth Cir.1963). Likewise, courts

have consistently regarded the Bill of Attainder Clause

of Article I and the principle of the separation of powers

only as protections for individual persons and private

groups, those who are peculiarly vulnerable to non-

judicial determinations of guilt. See United States v.

Brown, 381 U.S. 437[, 85 S.Ct. 1707, 14 L.Ed.2d 484];

Ex parte Garland, 4 Wall. 333[, 18 L.Ed. 366]. Nor does

(Cont'd)

ee

23a

‘ Appendix B

(Cont'd)

a State have standing as the parent of its citizens to

invoke these constitutional provisions against the

Federal Government, the ultimate patens patriae of every

American citizen. Com. of Massachusetts v. Mellon, 262

U.S. 447, 485-486[, 43 S.Ct. 597, 600-01, 67 L.Ed.

1078] State of Florida v. Mellon, 273 U.S. 12, 18{, 47

S.Ct. 265, 266-67, 71 L.Ed. 511).

At issue is whether, like a state, a municipality enjoys no

protection of the Due Process Clause of the Fifth Amendment. In

the past, the Supreme Court has held that a municipal corporation

could not assert federal constitutional rights against their progenitors,

the states. See Williams v. Mayor and City Council of Baltimore,

289 U.S. 36, 40, 53 S.Ct. 431, 432, 77 L.Ed. 1015 (1933) and cases

cited therein. In City of Safety Harbor v. Birchfield, 529 F.2d 1251,

1254-55 (Sth Cir.1976) (footnotes omitted), the Fifth Circuit Court

of Appeals elaborated on this basis for denying municipal

corporations the protections of federal rights as against the states:

Ever since the Supreme Court's landmark decision in

Dartmouth College v. Woodward, 17 U.S. (4 Wheat.)

518, 4 L.Ed. 629 (1819), it has been apparent that public

entities which are political subdivisions of states do not

possess constitutional rights, such as the right to be free

from state impairment of contractual obligations, in the

same sense as private corporations or individuals. 17

U.S. (4 Wheat.) at 660-61 [ ]. Such entities are creatures

of the state, and possess no rights, privileges or

immunities independent of those expressly conferred

upon them by the state. Id.; Williams v. Mayor and City

Council of Baltimore, 289 U.S. 36, 40, 53 S.Ct. 431,

432, 77 L.Ed. 1015 (1933); see Railroad Commission

v. Los Angeles R.R., 280 U.S. 145, 156, 50 S.Ct. 71,

(Cont'd)

24a

Appendix B

(Cont'd)

73-74, 74 L.Ed. 234[ ] (1929); Risty v. Chicago, R.I. &

P.R.R., 270 U.S. 378, 390, 46 S.Ct. 236, 241, 70 L.Ed.

641 (1926); City of New York v. Richardson, 473 F.2d

923, 929 (2nd Cir.1973) cert. denied sub nom. Lavine

v. Lindsay, 412 U.S. 950, 93 S.Ct. 3012, 37 L.Ed.2d

1002 (1973). Thus, in Trenton v. New Jersey, 262 U.S.

182, 43 S.Ct. 534, 67 L.Ed. 937 (1923), the Supreme

Court held that a city which had obtained its water

resources by acquiring a private water company through

proper exercise of its proprietary authority could not

assert the right to freedom from impairment of

contractual obligations because of the difference in the

relation of private and public entities to the state. In

contrast to private individuals and entities, municipal

corporations have repeatedly been denied the right to

challenge state legislation allegedly violative of the

Federal Constitution. Williams v. Mayor and City

Council of Baltimore, supra; Pawhuska v. Pawhuska Oil

& Gas Co., 250 U.S. 394, 398, 39 S.Ct. 526, 527-28,

63 L.Ed. 1054 (1919) (‘as respects grants of political

governmental authority to cities, towns, counties, and

the like the legislative power of states is not restrained

by the contract clause of the Constitution’); City of New

Orleans v. New Orleans Water-Works Co., 142 U.S.

79, 12 S.Ct. 142, 35 L.Ed. 943 (1891).

See also Appling County v. Municipal Electric Authority of Georgia,

621 F.2d 1301, 1307-08 (Sth Cir. 1980).

An apparent corollary of the argument given by the Fifth Circuit,

that a municipality derives all of its rights, privileges and immunities

from the state’s conference of those rights on the municipality, is

that it is impossible for the municipality to have any rights, privileges

(Cont'd)

eK —

s

}

}

t

25a

Appendix B

(Cont'd)

or immunities that cannot be conferred by the state. The State, as an

entity not enjoying the protections of the Due Process Clause may

not be able to confer Fifth Amendment Due Process rights upon the

municipality. See City of Sault Ste. Marie, Michigan v. Andrus,

532 F.Supp. 157, 167-68 (D.C.D.C.1980). The weakness of this

argument is that constitutional rights are supposedly non-

transferrable (read “inalienable”) and, therefore, cannot be imparted

on an individual or organization by the state, a citizen or anything

else, aside from the Constitutional provisions.

Apparently, the resolution to the problem is not to be found in

consideration of what rights are conferred by whom, but through an

examination of the meaning of the term “person” in the Fifth

Amendment to determine if municipal corporations are directly

protected. Here, though, there exists conflicting guidance. The

relevant portion of the Fifth Amendment states:

... nor shall any person be subject for the same offense

to be twice put in jeopardy of life or limb; nor shall be

compelled in any criminal case to be a witness against

himself, nor be deprived of life, liberty, or property

without due process of law; nor shall private property

be taken for public use, without just compensation.

U.S. CONST., AMENDMENT V. As a structural matter, given that

the rights enumerated are all granted to the same subject, “any

person,” a determination of who is a person for any one the

enumerated rights should extend equally to any other rights in the

clause. One provision of the Fifth Amendment, the takings clause,

has been held by the Supreme Court to bestow a right upon a

municipality. See Thorpe v. Housing Authority of the City of

Durham, 393 U.S. 268, 278 n. 31, 89 S.Ct. 518 n. 31, 21 L.Ed.2d

474 (1969). At the same time, the Supreme Court has held that “the

(Cont'd)

26a

Appendix B

Il. THE PUBLIC INTEREST REVIEW.

The second grounds for remand raised by the plaintiff is

that the Corps inadequately considered the impact of

Bessemer’s proposed water project on the public interest.

The Water Works contents that the Corps failed to conduct

an adequate public interest review because (1) the Corps’

analysis was too narrow in scope; (2) the Corps did not

conduct an adequate consideration of the need of the project;

(3) the Corps did not appropriately consider alternatives to

the construction of the project; (4) the Corps did not consider

water supply in making its decision; (5) the Corps failed to

address the economic impacts of the project, (6) the Corps

(Cont'd)

privilege against compulsory self-incrimination should be ‘limited

to its historic function of protecting only the natural individual from

compulsory incrimination through his own testimony or personal

records.’ ” Bellis v. United States, 417 U.S. 85, 89-90, 94 S.Ct. 2179,

2183, 40 L.Ed.2d 678 (1974)(quoting United States v. White, 322

U.S. 694, 701, 64 S.Ct. 1248, 1252, 88 L.Ed. 1542 (1944)).

Perhaps the issue can be resolved by affiliating the Due Process

Clause with the self-incrimination provision of the Fifth Amendment

because the two are part of the same phrase, whereas the Takings

Clause exists as an entirely separate phrase. However, this argument

borders on hair-splitting, as its conclusion rests entirely on the

emphasis placed on the comma resting between the self-

incrimination language and the Due Process Clause as compared to

the semicolon placed between the Due Process Clause and the

Takings Clause. A thorough resolution of the issue is only to be

found in a careful historical analysis of the clause and its common

law ancestry. However, such analysis is not necessary to this court’s

conclusion.

27a

Appendix B

insufficiently addressed the issue of water quality; and

(7) the Corps did not fully consider the impacts of the project

on threatened and endangered species. Before addressing the

substance of this extended argument, however, the court will

examine the plaintiff's argument that in evaluating the Corps’

decision to permit the Bessemer project the court should

consider not only the administrative record, but should allow

the plaintiff to conduct discovery and introduce materials

extraneous to the record in a hearing before the court.

A. Hearings and Discovery.

“The focal point for judicial review of an administrative

agency’s action should be the administrative record.”

Preserve Endangered Areas of Cobb’s History Inc. v. United

States Army Corps of Engineers, 87 F.3d 1242, 1246 (11th

Cir.1996). The Water Works contends that, although the

administrative record is the focus in reviewing administrative

action, where insufficient information exists in the record

for the court to determine whether the agency’s action is

arbitrary and capricious, it should look beyond the record,

allowing discovery and an in-court hearing. In Camp v. Pitts,

411 U.S. 138, 93 S.Ct. 1241, 36 L.Ed.2d 106 (1973), the

Supreme Court addressed the twin issues of when and to

what extent a district court may conduct a hearing on a matter

decided by an administrative agency. On the issue of when

a district court may hold a hearing on review of a case from

an agency, the Court stated that a hearing may be appropriate

if an agency fails to adequately explain its decision. Id. at

142, 93 S.Ct. at 1243-44. However,

[i]f the record before the agency does not support

the agency action, if the agency has not considered

28a

Appendix B

all relevant factors, or if the reviewing court

simply cannot evaluate the challenged agency

action on the basis of the record before it, the

proper course, except in rare circumstances, Is to

remand to the agency for additional investigation

or explanation. The reviewing court is not

generally empowered to conduct a de novo inquiry

into the matter being reviewed and to reach its

own conclusions based on such an inquiry.

Florida Power & Light Company v. Lorion, 470 U.S. 729,

744, 105 S.Ct. 1598, 1607, 84 L.Ed.2d 643 (1985); Preserve

Endangered Areas of Cobb’s History, Inc. [PEACH] v.

United States Army Corps of Engineers, 87 F.3d at 1246

(quoting Florida Power & Light). In PEACH, the Eleventh

Circuit Court of Appeals in passing noted four circumstances

(elaborated by the Ninth Circuit Court of Appeals in Animal

Defense Council v. Hodel, 840 F.2d 1432, 1436-37 (9th

Cir.1988)), that could potentially support a decision by a

district court to hold a hearing:

The Ninth Circuit has specified that a court may

go beyond the administrative record only where:

1) an agency’s failure to explain its action

effectively frustrates judicial review; 2) it appears

that the agency relied on materials not included

in the record; 3) technical terms or complex

subjects need to be explained; or 4) there is a

strong showing of agency bad faith or improper

behavior. (Citation omitted) We need not consider

these exceptions as none of them apply in the

instant case.

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29a

Appendix B

Preserve Endangered Areas of Cobb’s History, Inc. [PEACH]

v. United States Army Corps of Engineers, 87 F.3d at 1246

n. |. Even were the court to accept the four listed exceptions

as an accurate statement of the law of this circuit, the plaintiff

has not shown that the Corps’ decision is flawed for any of

the listed reasons. The only basis argued by the Water Works

as justifying a hearing is that, in giving “abstract and

conclusory” grounds for granting Bessemer’s permit, the

Corps failed to adequately explain its decision and thereby

frustrated judicial review. Far from being abstract and

conclusory, however, the district engineer’s permitting

decision is thorough and thoughtful. The explanations given

by the district engineer are sufficiently clear and developed

to allow this court to review the record and determine whether

the decision was arbitrary and capricious.

The Water Works asserts, as an additional reason for

the grant of a hearing, that because the Corps was required

to undertake an environmental assessment In accordance with

the National Environmental Policy Act (“NEPA”), this court

is not obligated to confine its review to the administrative

record. Instead, the plaintiff argues, the court is authorized

to look beyond the administrative record to consider factors

that the district engineer may have ignored. The impact

of this argument is, however, confined to the Corps’

environmental assessment and will be taken up in more detail

when the court reviews the Corps’ environmental assessment

of the Bessemer project. At this point, the court simply notes

that any NEPA provision permitting the submission of new

evidence for examining the adequacy of the Corps’

environmental assessment does not extend to the Corps’

public interest review and the Corps’ review under the

30a

Appendix B

Environmental Protection Agency’s Guidelines governing

permits for discharges of dredged or fill material promulgated

through section 404(b)(1) of the Clean Water Act.

B. Scope of Review.

In considering any permit application, the Corps is

required to follow, at a minimum, the regulations set out in

33 C.F.R. Parts 320-329. The regulations contained in this

section obligate the Corps to consider certain general factors

in every permitting decision and, depending upon the activity

being permitted, other more specific factors and policies.

See 33 C.F.R. § 320.1(b) & § 320.4. The review conducted

under these regulations is deemed the “public interest review”

and is elaborated in detail in 33 C.F.R. § 320.4(a)(1):

(a) Public Interest Review.

(1) The decision whether to issue a permit will

be based on an evaluation of the probable impacts,

including cumulative impacts, of the proposed

activity and its intended use on the public interest.

Evaluation of the probable impact which the

proposed activity may have on the public interest

requires a careful weighing of all those factors

which become relevant in each particular case.

The benefits which reasonably may be expected

to accrue from the proposal must be balanced

against its reasonably foreseeable detriments. The

decision whether to authorize a proposal, and if

so, the conditions under which it will be allowed

to occur, are therefore determined by the outcome

3la

Appendix B

of this general balancing process. That decision

; should reflect the national concern for both

} protection and utilization of important resources.

: All factors which may be relevant to the proposal

must be considered including the cumulative

effects thereof: among those are conservation,

economics, aesthetics, general environmental

concerns, wetlands, historic properties, fish and

wildlife values, flood hazards, floodplain values,

land use, navigation, shore erosion and accretion,

recreation, water supply and conservation, water

quality, energy needs, safety, food and fiber

production, mineral needs, considerations of

property ownership and, in general, the needs and

welfare of the people. For activities involving 404

discharges, a permit will be denied if the discharge

that would be authorized by such permit would

not comply with the Environmental Protection

Agency’s 404(b)(1) guidelines. Subject to the

preceding sentence and any other applicable

guidelines and criteria (see §§ 320.2 and 320.3),

a permit will be granted unless the district

engineer determines that it would be contrary to

the public interest.

See also Van Abbema v. Fornell, 807 F.2d 633, 636 (7th

Cir.1986). Certain criteria are to be evaluated in every

application for a permit:

(i) The relative extent of the public and private

need for the proposed structure or work;

AU RP aa RCN et mo He

32a

Appendix B

(ii) Where there are unresolved conflicts as to

resource use, the practicability of using reasonable

alternative locations and methods to accomplish

the objective of the proposed structure or work;

and

(iii) The extent and permanence of the beneficial

and/or detrimental effects which the proposed

structure or work is likely to have on the public

and private uses to which the area is suited.

-33 C.F.R. § 320.4(a)(2). In addition, certain factors, such as

conservation, economics, aesthetics, general environmental

concerns, wetlands, historic properties, fish and wildlife

values, etc., are to be considered and evaluated based upon

their relative importance to the project at hand. 33 C.F.R.

§ 320.4(a)(3).

In conducting the public interest review, the Corps is

limited in the aspects of the entire project on which it may

focus. The Water Works first questions the limitations the

Corps placed on the scope of its public interest review.

According to the Water Works, the Corps, in conducting its

public interest review, impermissibly confined itself to

examining the impacts of the construction and maintenance

of the intake facility and the construction and maintenance

of the pipeline across various streams and other waters and

wetlands. Allegedly, it did not review the consequences of

the entire project, including construction and maintenance

of the proposed water treatment plant. The Water Works

contends that examination of these aspects of Bessemer’s

proposed project was required under the public interest

SOR eae | Onaga! re NS SL Iam at apt LS ONPG: LOR Sah

lta Ae an Ta ay Bins Fee Chg tile Bhs 2% ELL Aly ae ie MOR

33a

Appendix B

review. Although the Water Works cites no law to support

its contention, it argues that because the public interest

review is a “broad review,” not only should the structures

affecting the navigable waters of the United States be

evaluated, but also those structures that help fulfill the

purposes of the project.

The defendants respond that the plaintiff's contention

that a “broad review” is required is mistaken, Stating that

the scope of the overall project review that the Corps is to

undertake is governed by the National Environmental Policy

Act (“NEPA”) implementation procedures for the regulatory

program that are contained at 33 C.F.R. Pt. 325 App. B

§ 7.b. The plaintiff counters that 33 C.F.R. Pt. 325 App. B

§ 7 does not apply to the public interest review because its

only stated purpose is to guide the NEPA review of the action.

The defendants dispute this contention and point to 33 C.F.R.

Pt. 325, App. B § 7.a, which states that “(t]he EA [NEPA

environmental assessment] should normally be combined

with other required documents (EA/404(b)(1)/SOF/FONSI).

‘EA’ as used throughout this Appendix normally refers to

this combined document.” According to the defendants,

because the environmental assessment as described in

appendix B includes the other documents involved in other

evaluations, the regulations governing the jurisdictional

scope of the NEPA review by definition govern the

jurisdictional scope of the public interest review.’

8. The court here notes that the arguments garnered by the

plaintiff in support of its positions tend to be a mish-mash of statutory

and regulatory provisions assembled without contextual or other

guides. The plaintiff manages to confuse, conflate and combine

regulations and laws governing all three forms of review throughout

its briefs.

34a

Appendix B

In Sylvester v. Army Corps of Engineers (Sylvester II),

882 F.2d 407, 410 n. 4 (9th Cir., 1989), the Ninth Circuit

Court of Appeals noted a distinction between the scope of

the public interest review and the NEPA review:

[U]nder the C.W.A. [Clean Water Act], the Corps

is not limited by a regulation similar to 33 C.F.R.

pt. 325 app. B § 7.... As a consequence, the

Corps could properly consider a wider range of

facts in conducting its public interest analysis.

The language in Sylvester II notwithstanding, the court is

convinced that the extent of the entire project reviewable by

the Corps under its public interest review is essentially the

same as the extent of review permitted under the NEPA

analysis. First, the language of the regulation defining the

focus of the public interest review limits that focus to the

effects of the “proposed activity”:

The decision whether to issue a permit will be

based on an evaluation of the probable impacts,

including cumulative impacts, of the proposed

activity and its intended use on the public

interest. .. . The decision whether to authorize a

proposal, and if so, the conditions under which it

will be allowed to occur, are therefore determined

by the outcome of this general balancing process.

33 C.F.R. § 320.4. The above makes it clear that what is

meant by “proposal” is that which the Corps has the capacity

to authorize. However, only the portion of an overall project

that occurs in the navigable waters of the United States can

35a

Appendix B

be authorized by the Corps. The Corps has no authority to

permit or even regulate any other activity, although it may

consider the direct, indirect and cumulative impacts of the

proposed activity. The Corps’ public interest review is not

to cover the totality of all activities, however.

Further, the results of the public interest review are to

be recorded in a statement of findings, in conjunction with

the other review documents. 33 C.F.R. § 325.2. That the

regulations, in the same section in which the scope of analysis

for the environmental assessment (“EA”) is described, state

that the “EA” refers to the combined document containing

the statement of findings indicates to the court that the scope

of analysis considered in 33 C.F.R. Pt. 325 App. B. § 7 is

the same as the activity to be considered under 33 C.F.R.

§ 320.4(a)(1).’

The Corps drafted its first set of regulations governing

the scope of review in cases involving both federal and non-

federal actions in 1980. See Sylvester v. U.S. Army Corps

of Engineers, 884 F.2d 394, 398 (9th Cir.1989). The same

year, the Fifth Circuit Court of Appeals, in Save the Bay,

9. Not that it makes any considerable difference whether the

“proposed action” considered in the public interest review and the

“scope” of the NEPA review overlap as a matter of regulatory

definition. Even if the focus of the two reviews are not necessarily

co-extensive, they are contingently coextensive in this case. The

proposed activity as defined by the district engineer in his statement

of findings, see infra at 1070-71, is precisely the same as the scope

of analysis decided by the district engineer in the environmental

assessment attachment. See discussion of district engineer’s

jurisdiction determination, infra at 1070-73.

36a

Appendix B

Inc. v. United States Corps of Engineers, 610 F.2d 322, 327

(Sth Cir.1980),'° held that the Corps’ regulations limited its

public interest review in certain cases to the federal aspects

of a project and that the Corps was not required to consider

the entire proposed project in conducting its review. In Save

the Bay v. United States Corps of Engineers, proposed to

build a titanium dioxide plant in Delisle, Mississippi, a town

located near Bay St. Louis (an inlet from the Mississippi

Gulf Coast). Associated with the building of the plant was

construction of a 24-inch pipeline that would extend 2,000

feet and discharge industrial wastewater into the Bay of St.

Louis. Id. at 323-24. The Corps permitted the construction

of the pipeline and, in deciding to do so, considered solely

the consequences of the pipeline construction and discharge,

not of the construction and maintenance of the titanium

dioxide plant as a whole.

The plaintiffs objected to the Corps permitting decision

in the district court, arguing, among other things, that the

Corps had an obligation to consider the effects of the entire

project. In support of its contention, the plaintiffs argued

that if any portion of the proposed activity was enabled by

the pipeline, the consequences of the enabled activity should

be considered in addition to the impacts of the construction

and maintenance of the pipeline itself. Because, the plaintiffs

alleged, the pipeline enabled the plant to discharge its waste

water, the plant was enabled by the pipeline and the impacts

of its construction and maintenance should have been

10. This case and the one discussed after it (Winnebago) are

both principally National Environmental Policy Act cases and the

issue of the scope of review is centered on what the scope of review

1s in developing an environmental assessment.

2 eevee

CN ents aR lOO op the Blt

37a

Appendix B

considered. The Fifth Circuit Court of Appeals stated that if

the “enablement theory” was correct, the plant should have

been considered in Corps’ review of the permit. However,

the Fifth Circuit Court of Appeals rejected the “enablement

theory” of the plaintiffs. Id. at 327. Instead, the Fifth Circuit

merely found that the Corps was only required to consider

the impacts of the pipeline in making its permitting decision.

The court did not elaborate on its basis for finding that the

Corps could confine its review to the Pipeline, but instead

limited itself to explication of why the cases cited by the

plaintiffs did not support the enablement theory. Id. at 327.

In Winnebago Tribe of Nebraska v. Ray, 621 F.2d 269

(8th Cir.1980), the Eighth Circuit Court of Appeals

considered whether the Corps was required to evaluate an

entire project involving the construction of a power line that

crossed the Missouri River and would run through the

Winnebago Indian Reservation. The river crossing would

extend 1.25 miles out of the total sixty-seven miles that the

power line was to-extend. The Corps refused to extend its

analysis beyond that portion of the line crossing the river.

Id. at 270.

The Winnebago Tribe and others brought an action in

the district court to require the Corps to consider the impact

upon the other sixty-five and some-odd miles, and the case

eventually found its way to the Eighth Circuit Court of

Appeals. First, the Eighth Circuit distinguished the case

before it from an earlier case in which an “enablement

theory” was proposed. Id. at 272. Finding that “[i]n

‘enablement’ cases federal action is a legal condition

precedent to accomplishment of an entire nonfederal

38a

Appendix B

project,”'' the Corps’ ability to deny permitting of only a

section of the power line constituted “but-for” veto power

over the project. (That is, but for the denial of the permit of

the section of the line, the entire line could have been built.)

The court then developed and applied three factors by which

to determine if the Corps would have jurisdiction over an

entire project based upon its ability to issue a permit as to a

portion of the project.

The court in NAACP v. Medical Center, 584 F.2d 619

(1978), identified three factors helpful in determining

whether “but for” or factual control requires project-wide

analysis: (1) the degree of discretion exercised by the agency

over the federal portion of the project; (2) whether the federal

government has given any direct financial aid to the project;

and (3) whether “the overall federal invoivement with the

project (is) sufficient to turn essentially private action into

federal action.” Id. at 629 (citation omitted)... .

In the present suit, while the Corps has broad discretion

to consider environmental impacts (see Zabel v. Tabb, 430

11. As the Eight Circuit Court of Appeals considered it, the

Corps would have enablement jurisdiction over the entire project

only when its legal decision governed the entire project This may

very well have been a question-begging answer to the issue of the

“enablement theory” of jurisdiction, i.e., that the Corps has

jurisdiction to review the entire project when it has jurisdiction to

review the entire project.

Another point to note is that while both the Fifth Circuit and

the Eighth Circuit discuss an “enablement theory” of Corps’

jurisdiction, they clearly mean two different things by it.

; 39a

Appendix B

F.2d 199 (Sth Cir.1970), cert. denied, 401 U.S. 910, 91 S.Ct.

i 873, 27 L.Ed.2d 808 (1971)), that discretion must be

i exercised within the scope of the agency’s authority. As noted

above, the Corps’ jurisdiction under section 10 extends only

to areas in and affecting navigable waters. See United States

v. Sexton Cove Estates, Inc., 526 F.2d 1293, 1299 (Sth

Cir.1976); Weiszmann v. District Engineer, United States

Army Corps of Engineers, 526 F.2d 1302, 1304 (Sth

Cir.1976); United States v. Joseph G. Moretti, Inc., 526 F.2d

1306 (Sth Cir.1976). As the Third Circuit observed in United

States v. Stoeco Homes, Inc., 498 F.2d 597, 607 (3d

Cir.1974):

The federal environmental protection statutes did .

not * * * by their terms enlarge the jurisdiction

of the Army Corps of Engineers under the Rivers

and Harbors Appropriation Act of 1899. If there

is no such jurisdiction environmental protection

is still a matter primarily of state concern.

Thus, the Corps’ discretion under section 10 does

not dictate project-wide review.

The factors remaining for consideration under

Medical Center are the presence of direct federal

funding and the degree of federal involvement.

There has been no direct or even indirect federal

funding for this project. Cf. Ely v. Velde, 451 F.2d

1130 (4th Cir.1971)(Law Enforcement Assistance

Administration involvement in and funding for a

state prison amounts to major federal action). As

for federal involvement, the fact that part of the

40a

Appendix B

line will cross the Winnebago Reservation does

not suffice to turn this essentially private action

into federal action. Federal law allows the state

to condemn this land for any public purpose in

the same manner as land owned in fee. 25 U.S.C.

§ 357 (1976). Thus, we conclude that the Corps

did not have sufficient control and responsibility

to require it to study the entire project.

Id. at 272-73 (footnotes omitted).

In 1988, the Corps drafted an amendment to the

regulations that effectively codified Save the Bay and

Winnebago. Sylvester v. U.S. Army Corps of Engineers, 884

F.2d at 398. These regulations now state:

b. Scope of Analysis. (1) In some situations, a

permit applicant may propose to conduct a

specific activity requiring a Department of the

Army (DA) permit (e.g., construction of a pier in

a navigable water of the United States) which is

merely one component of a larger project (e.g.,

construction of an oil refinery on an upland area).

The district engineer should establish the scope

of the NEPA document (e.g., the EA or EIS) to

address the impacts of the specific activity

requiring a DA permit and those portions of the

entire project over which the district engineer has

sufficient control and responsibility to warrant

Federal review.

(2) The district engineer is considered to have

control and responsibility for portions of the

‘i ae,

4la

Appendix B

project beyond the limits of Corps jurisdiction

where the Federal involvement is sufficient to turn

an essentially private action into a Federal action.

These are cases where the environmental

consequences of the larger project are essentially

products of the Corps permit action.

Typical factors to be considered in determining

whether sufficient “control and responsibility”

exists include:

(i) Whether or not the regulated activity

comprises “merely a link” in a corridor

type project (e.g., a transportation or

utility transmission project).

(ii) Whether there are aspects of the

upland facility in the immediate vicinity

of the regulated activity which affect the

location and configuration of the

regulated activity.

(iii) The extent to which the entire

project will be within Corps

jurisdiction.

(iv) The extent of cumulative Federal

control and responsibility.

A. Federal control and responsibility will include

the portions of the project beyond the limits of

Corps jurisdiction where the cumulative Federal

42a

Appendix B

involvement of the Corps and other Federal

agencies is sufficient to grant legal control over

such additional portions of the project. These are

cases where the environmental consequences of

the additional portions of the projects are

essentially products of Federal financing,

assistance, direction, regulation, or approval (not

including funding assistance solely in the form

of general revenue sharing fluids, with no Federal

agency control over the subsequent use of such

funds, and not including judicial or administrative

civil or criminal enforcement actions).

B. In determining whether sufficient cumulative

Federal involvement exists to expand the scope

of Federal action the district engineer should

consider whether other Federal agencies are

required to take Federal action under the Fish and

Wildlife Coordination Act (16 U.S.C. 661 et seq.),

the National Historic Preservation Act of 1966

(16 U.S.C. 470 et seq.), the Endangered Species

Act of 1973 (16 U.S.C. 1531 et seq.), Executive

Order 11990, Protection of Wetlands, (42 U.S.C.

4321 91977), and other environmental review

laws and executive orders.

C. The district engineer should also refer to

paragraphs 8(b) and 8(c) of this appendix for

guidance on determining whether it should be the

lead or a cooperating agency in these situations.

33 C.F.R. Pt. 325, App. B § 7.b. The Corps’ regulations give

examples as a guide to how specific permitting decisions

should be handled.

43a

Appendix B

For those regulated activities that comprise merely

a link in a transportation or utility transmission

project, the scope of analysis should address the

Federal action, i.e., the specific activity requiring

a DA permit and any other portion of the project

that is within the control or responsibility of the

Corps of Engineers (or other Federal agencies).

For example, a 50-mile electrical transmission

cable crossing a | 1/4 mile wide river that is a

navigable water of the United States requires a

DA permit.'? Neither the origin and destination

of the cable nor its route to and from the navi gable

water, except as the route applies to the location

and configuration of the crossing, are within the

control or responsibility of the Corps of

Engineers. Those matters would not be included

in the scope of analysis which, in this case, would

address the impacts of the specific cable crossing.

Conversely, for those activities that requireaDA

permit for a major portion of a transportation or

utility transmission project, so that the Corps

permit bears upon the origin and destination as

well as the route of the project outside the Corps

regulatory boundaries, the scope of analysis

should include those portions of the project

outside the boundaries of the Corps section

10/404 regulatory jurisdiction. To use the same

example, if 30 miles of the 50-mile transmission

ee ee Ree ee ee en a Ee

12. Note the striking similarity to the facts in Winnebago Tribe

of Nebraska v. Ray, 621 F.2d at 270.

44a

Appendix B

line crossed wetlands or other “waters of the

United States,” the scope of analysis should reflect

impacts of the whole 50-mile transmission

lime....

In all cases, the scope of analysis used for

analyzing both impacts and alternatives should

be the same scope of analysis used for analyzing

the benefits of a proposal.

33 C.F.R. Pt. 325, App. B § 7.b(3).

In a description of the project, the district engineer

discussed the intake structure and pipeline as relevant to his

analysis with respect to permitting:

a. Project Description: Construct a water intake

structure, a 30-inch diameter transmission line and

a 25-million-gallons per day (MGD) water

treatment plant. Construction of the intake

structure includes a temporary 240-foot-long

Z-pile cofferdam,"’ controlled blasting and

. dredging of up to 500 cubic yards of silt, sand,

gravel, rock, and debris in the intake structure

channel. The transmission line will generally

follow existing roadways and a natural gas

pipeline, and have a total length of approximately

21 miles. Construction of the transmission line

13. A cofferdam is “[a] temporary watertight enclosure that is

pumped dry to expose the bottom of a body of water so that

construction, as of piers, may be undertaken.” AMERICAN

HERITAGE DICTIONARY, 3D EDITION, at 368.

45a

Appendix B

includes the redeposit of soil material (fallback)

incidental to pipeline excavation (550 cubic

yards), and the discharge of bedding material

(crushed stone) and riprap" at 17 creek/drainway

crossings. The total length of the 17 crossings is

272 feet (0.051 mile or 0.0024% of the pipeline

length)... .

A.R. at 901-02. The Water Works raises the argument that

the district engineer was ambivalent about whether he was

required to consider only the construction of the pipeline

and intake structure or the entire Bessemer project. Because,

the Water Works contends, the district engineer was

ambiguous about the scope of the review, the court should

either interpret the review’s scope to include the entire project

and remand the case because the Corps failed to consider

the entire project at points in the review, or the court should

remand the case to the Corps for it to determine the

appropriate scope of review.'® The Water Works bases its

14. Riprap is “[a] loose assemblage of broken stones erected

in water or on soft ground as a foundation” or a “broken stone[ |

used for such a foundation.” AMERICAN HERITAGE

DICTIONARY, 3D EDITION, at 1556.

15. Of course, as this court realizes, if the Water Works is

unhappy about the determination of the scope of the Corps’ review

on remand, it will file yet another action in this court. In fact, this

court envisions that the plaintiff will continue to resist the Bessemer

project on permitting grounds until a higher federal court than this

one finds that the Corps properly pertained the facility. In this way,

administrative procedure may encourage unfair competition and a

(Cont'd)

46a

Appendix B

argument regarding the district engineer’s apparent

ambivalence on a statement of jurisdiction made in response

to issues raised by the plaintiff concerning practicable

alternatives and water allocation:

The Corps jurisdiction in this permit application

relates to the construction of the water intake

structure and pipeline in jurisdictional waters of

the United States. The Corps does not have

jurisdiction over the withdrawal or allocation of

water from the Black Warrior River. The primary

focus of our evaluation is on the direct impacts

of the intake structure, pipeline and treatment

plant (e.g. navigation, water quality, threatened

and endangered species, and cultural resources).

Corps regulations at 33 CFR 320.4(m) and

guidance contained in Regulatory Guidance Letter

85-6 states that the primary responsibility for

water allocation rests with the states.

(Cont'd)

waste of judicial resources. For example, this case does not once

concern itself in any depth with the substance of the Corps’ decision,

only with whether the Corps followed an elaborate set of procedures

that are likely more difficult for the court to comprehend than the

agency itself. However, given their ornate and convoluted structure,

an individual with enough monetary power who is opposed to a

project of any sort can, by finding some threadbare indication that

the regulations were not complied with or were not reasonable, either

make the project economically unfeasible due to litigation costs or

cause extreme delay in construction of the project sufficient to recoup

the costs invested in litigation.

ne

47a

Appendix B

A.R. at 916 (emphasis added). The Water Works contends

that the district engineer’s statement that its focus was upon

the “direct impacts of the intake structure, pipeline and

treatment plant” constitutes a determination to review the

entire Bessemer project. The defendants, by contrast,

consider the significant portion of the district engineer’s

description of his jurisdiction to be the limitation of

jurisdiction to the intake structure and pipeline.

The district engineer’s elaboration of the directly

relevant impacts of the construction in the navigable waters

in his description of the proposal (at A.R. at 901-02, above)

indicates that his review was likely focused upon the

consequences of that construction. This is further evidenced

by full consideration of the district engineer’s statement of

the Corps’ jurisdiction. The district engineer states quite

clearly that the Corps’ jurisdiction is limited to consideration

of impacts of construction of the intake structure and

pipeline. That the district engineer goes on to state that the

“primary focus of our evaluation is on the direct impacts of

the intake structure, pipeline and treatment plant” is not

meant as an extension of jurisdiction to the treatment plant,

but is instead a description of the district engineer’s analysis

as Concerning the consequences on navigation, water quality,

threatened and endangered species and cultural resources that

the intake structure and pipeline would create based upon

the construction and maintenance of the entire project. In

sum, the district engineer is concerned with the water

treatment plant only insofar as it affects the effects of the

intake structure and pipeline on navigation, etc.

The Water Works next challenges the reasonableness of

the district engineer’s interpretation of the regulations on

48a

Appendix B

the basis that the intake structure and pipeline are

interdependent with the water treatment plant and that,

consequently, the entire project should be considered. This

argument by the Water Works is significantly similar to the

enablement theory raised by the plaintiffs in Save the Bay.

Save the Bay, Inc. v. United States Corps of Engineers, 610

F.2d at 327. According to the Water Works, the project is

interdependent in that one portion of the project will not work

without the other parts, such as the pipeline and intake

structure. So much is true. But the same was the case with

the titanium dioxide plant and industrial wastewater pipeline

in Save the Bay. Id. Even though the reasoning of the Water

Works is correct, legal support is absent. As our predecessor

circuit found in Save the Bay, there is no support for an

enablement theory. Id.'° As the Ninth Circuit Court of

Appeals noted in Sylvester v. U.S. Army Corps of Engineers,

884 F.2d at 398, this reasoning was incorporated into the

regulations presently employed by the Corps in determining

the scope of its jurisdiction.

The district engineer determined that the treatment plant

did not fall under the regulatory contro] of other federal

statutes and that the construction of the intake structure and

the pipeline crossings comprised a link in the chain used to

provide water to Bessemer. See 33 C.F.R. Pt. 325, App. B

§ 7.b(2). Again, the plaintiff argues that the intake structure

and pipeline crossings enable the water treatment plant to

operate and are therefore more than mere links in the chain.

16. As this court noted earlier in this opinion, decisions of the

Fifth Circuit Court of Appeals announce prior to the circuit split are

binding upon this court, unless otherwise overruled by the Eleventh

Circuit Court of Appeals.

49a

Appendix B

The water treatment plant and the aspects of the project

not related to the intake structure and the pipeline crossings

are not within the scope of the Corps’ jurisdiction in

undertaking the public interest review. The intake structure

and pipeline crossings comprise but a small portion of the

entire project. The water treatment plant is far upland from

the intake structure. Perhaps the intake structure and pipeline

are more than mere links, but the Corps’ permitting regulation

over these structures constitutes no more than a “but-for”

veto over the entire project. See Winnebago Tribe of

Nebraska v. Ray, 621 F.2d at 272. Even if the intake structure

and pipeline are essential for the viability of the project, the

district engineer was not acting improperly in determining,

as with the example of the power line crossing the

unavoidable river, that the structures’ necessity did not permit

the Corps to consider the entire project.

C. Needs Analysis.

The Water Works next argues that in failing to

adequately determine if Bessemer needed an additional

supply of water, the Corps improperly conducted its needs

analysis under its general public interest review. The

defendants respond that the Water Works’ argument that the

Corps was required to perform a needs analysis is misguided.

33 C.F.R. § 320.4(a)(2)(i) states:

The following general criteria will be considered

in the evaluation of every application:

(i) The relative extent of the public and

private need for the proposed structure

or work...

50a

Appendix B

The Corps contends that in the decision to permit the

Bessemer project, a needs analysis was not necessary. In

support of its position, the Corps cites 33 C.F.R.

§ 320.4(a)(3):

The specific weight of each factor is determined

by its importance and relevance to the particular

proposal. Accordingly, how important a specific

factor is and how much consideration it deserves

will vary with each proposal. A specific factor

may be given great weight on one proposal, while

it may not be present or as important on another.

However, full consideration and appropriate

weight will be given to all comments, including

those of federal, state, and local agencies, and

other experts on all matters within their expertise.

The defendants reason that because any “specific factor,”

such as a needs analysis, “may not be present” in a public

interest review that, at least in principle, the Corps was not

required to perform a needs analysis in the instant case.

Although the Corps is to be given some leeway in the

interpretation of its own regulations, where the agency’s

action clearly diverges from its regulations, the matter ceases

to be one of interpretation and becomes one of the Corps’

failure to follow its own rules. The language permitting the

district engineer to omit a factor from consideration is in

contrast to the language in section 320.4(a)(2) which states

that every application will contain an evaluation of needs.

Further, the needs analysis is considered a “criterion”

to be considered in making a permitting determination, not

ee NN

Sla

Appendix B

a “factor.” The term “factors” used in section 320.4(a)(3)

more properly refers to the list of considerations contained

at section 320.4(a)(1):

All factors which may be relevant to the proposal

must be considered including the cumulative

effects thereof: among those are conservation,

economics, aesthetics, general environmental

concerns, wetlands, historic properties, fish and

wildlife values, flood hazards, floodplain values,

land use, navigation, shore erosion and accretion,

recreation, water supply and conservation, water

quality, energy needs, safety, food and fiber

production, mineral needs, considerations of

property ownership and, in general, the needs and

welfare of the people.

The regulations envision these factors as not only

standing alone in the analysis of public interest but also as

partaking in the required criteria evaluations. For example,

economic needs, environmental needs, mineral needs and

the like can be considered, if such factors are applicable, in

determining the public and private needs in question.

Therefore, although one or more factors may be irrelevant

in conducting a public interest review, it does not follow

that consideration of a criterion is irrelevant.

The defendants contend that the Corps is to generally

assume the need for a particular project to be genuine when

the permit applicant is a “private applicant.” See 33 C.F.R.

§ 320.4(q). The Corps, argues the defendants, interprets the

term “private applicant” to mean any “non-federal” applicant,

52a

Appendix B

including municipal corporations. Bessemer being a private

applicant, consideration of needs is not required.

33 C.F.R. § 320.4(q) states:

Economics. When private enterprise makes

application for a permit, it will generally be

assumed that appropriate economic evaluations

have been completed, the proposal is

economically viable, and is needed in the market

place. However, the district engineer in

appropriate cases, may make an independent

review of the need for the project from the

perspective of the overall public interest. The

economic benefits of many projects are important

to the local community and contribute to needed

improvements in the local economic base,

affecting such factors as employment, tax

revenues, community cohesion, community

services, and property values... .

There are two reasons that the application of this section for

the determination of whether, as a practical matter, a needs

analysis is required is questionable. First, the regulation

refers specifically to the circumstance in which a “private

enterprise makes an application for a permit” The defendants’

argument that the regulatory history indicates that an

economic needs analysis is inessential when the permit

applicant is a municipal corporation is likewise questionable.

The defendants rely on the interpretive guidance given in

the preamble to 33 C.F.R. Parts 320-330. The relevant section

of the Federal Register states:

|

|

53a

Appendix B

Section 320.4(q): Some commenters believed

that this rule would distort review criteria by

inserting inappropriate economic assumptions and

minimizing environmental criteria. Some

commenters suggested that the Corps revise this

paragraph to include a provision to challenge

an applicant’s economic data and that of

governmental agencies as well. Other commenters

believe that economic factors do not belong in

these regulations since the intent of the Clean

Water Act is: “to restore and maintain the

chemical, physical, and biological integrity of the

nation’s waters”; therefore, any regulation under

the CWA should have, as its primary objective,

provisions which give environmental factors the

greatest weight. They were concerned that this

part may be applied to allow economic benefits

to offset negative environmental effects. Some

commenters, however believed that the Corps

should assume that projects proposed by state and

local governmental interests and private industry

are economically viable and are needed in the

marketplace. They also believed that the Corps

and other governmental agencies should not

engage in detailed economic evaluations.

Economics has been included in the Corps list of

public interest factors since 1970. However, there

has never been a specific policy on economics in

the regulations. The Corps generally accepts an

applicant’s determination that a proposed activity

is needed and will be economically viable, but

makes its own decision on whether a project

54a

Appendix B

should occur in waters of the U.S. The district

engineer may determine that the impacts of a

proposed project on the public interest may

require more than a cursory evaluation of the need

for the project. The depth of the evaluation would

depend on the significance of the impacts and

in unusual circumstances could include an

independent economic analysis. The Corps will

balance the economic need for a project along

with other factors of the public interest.

Accordingly, § 320.4(q) has been modified from

the proposed rule to provide that the district

engineer may make an independent review of the

need for a project from the perspective of the

public interest.

51 Fed.Reg. 41,206, 41,207-08(1986)(emphasis added). The

interpretive guidance in the preamble to 33 C.F.R. §§ 320-

330 does not fully clarify the issue. The portion of the

preamble relied upon by the defendants, that “the Corps

should assume that projects proposed by state and local

governmental interests and private industry are economically

viable and needed in the marketplace” is preceded by the

words “[s]ome commenters . . . believed,” indicating that the

statement relied on by the defendants is merely a comment

made to the Corps by a, perhaps, interested party. In

addressing that comment, the preamble contains no

indication of whether consideration of economic need is

unnecessary for state and municipal permit applicants.

The second reason why section 320.4(q) may not obviate

the requirement of a needs analysis is that it only discusses

55a

Appendix B

the use of an economic needs analysis. However, the needs

analysis described in § 320.4(a)(2)(i) is not limited to

economic need, but is to involve an evaluation of “the extent

of the public and private need” of the project generally. This

includes consideration, where relevant, of such factors as

energy needs, mineral needs, food and fiber production and

community cohesion.'’ The defendants contend that, whether

a needs analysis was required or not, the district engineer

conducted such an analysis. The plaintiff contests this,

asserting that the district engineer failed to determine whether

the need for water could be satisfied from another source

without construction of the structure and pipeline. The Water

Works reasons that because it could have provided the

amount of water required by Bessemer from its own water

supply, no need exists for the project.

The plaintiff relies on the case of State of North Carolina

v. Hudson (Hudson I), 665 F.Supp. 428 (E.D.N.C.1987) to

support its contention that the Corps was required to examine

the extent of Bessemer’s need for water. In Hudson I, the

City of Virginia Beach, Virginia, which had long been

supplied water by the City of Norfolk, found itself in the

position of having grown too large for its water source.

Virginia Beach determined that it would eventually run short

on water if it continued to rely upon the city of Norfolk’s

water supply. Virginia Beach applied for a Department of

Army permit from the Corps, seeking to construct a pipeline

originating at the Pea Hill Creek tributary of Lake Gaston

on the Roanoke River, downstream from a Federal water

17. This is not an exhaustive list, but solely an indicator of the

factors that the Corps may find relevant to consider.

56a

Appendix B

supply at the John H. Kerr reservoir, and extending to

Virginia Beach. The Corps permitted the pipeline and the

case was brought to the district court. The court determined,

among other things, that the Corps had failed to conduct a

proper needs analysis of the pipeline construction:

The Corps cannot accede to Virginia Beach’s

desire to have an autonomous water supply at the

expense of the basin without at least examining

the water supply available from its current source.

No meaningful analysis of the extent of the public

need for the project could otherwise be conducted.

The need for the project depends on how much

water Virginia Beach needs which in turn requires

an analysis of its current supply.

The federal defendants and Virginia Beach

repeatedly argue that as the diversion is only a

a “miniscule” portion of the abundant flow of the

Roanoke River (about 1.2% of average flow) and

the environmental impacts of such a proposal

nearly “nonexistent,” Virginia Beach’s request for

an autonomous water supply must be given

priority in any public interest analysis. Such an

argument, however, ignores the purpose of the

public interest review and the correlative search

for alternative courses of action. Nonsignificant

impact does not equal no impact, and the purpose

of the public interest review is to consider and

balance competing interests, NEPA and non-

NEPA factors, to determine whether the project

is in the interest of the public. It requires the Corps

57a

Appendix B

to search for the least harmful alternative that is

feasible. See River Road Alliance, Inc. v. Corps

of Engineers, 764 F.2d at 452 (7th Cir.1985).

Id. at 446. In Hudson I, the requirement that the Corps show

the precise need for the withdrawals of water stemmed from

the fact that the withdrawals of water would affect, if only

indirectly, the Kerr Reservoir managed by the Corps. The

Corps’ jurisdiction in Hudsen I was, therefore, greater than

the mere construction of the pipeline, extending to water

Storage in and allocation of federally-controlled water

resources under Water Supply Act of 1958, 43 U.S.C. § 390b.

The proposed activity subject to the Corps’ public interest

review reached more than the mere construction of the

pipeline, and had to include a valuation of the need of the

water withdrawal itself.

As the defendants rightly point out, the only activity to

be considered in this case is the construction of the intake

structure and the associated pipeline crossings and its impact

on navigation, etc., not the entire project. The Water Supply

Act of 1958 is not implicated in this case. Therefore, the

Corps was not required to consider water allocation, nor was

it required to consider the economic benefit of an independent

water system as opposed to purchase of water from the Water

Works. See Clean Water Act § 101(g), 33 U.S.C. § 1251(g).

It was only obligated to consider the public and private needs

that the specific work would satisfy, balancing such factors

as the public need for navigable waters and the like against

Bessemer’s need to create a water withdrawal source on the

Black Warrior River.

58a

Appendix B

The district engineer, in evaluating the public and private

need of the project stated:

Public needs and welfare: The [Water Works] is

concerned that the Bessemer system will have a

single water supply source and that a drought or

emergency could jeopardize the flow of water to

Bessemer’s system. [The Water Works] contends

its existing four-sources-of-water-supply system

can better serve the needs of Bessemer customers.

[The Water Works] also contends that permitting

the Bessemer system in water that is “currently

allocated or over allocated” is clearly not in the

public’s best interest.

A.R. at 915.

The decision by the City of Bessemer to seek its

own water supply and the consequences of the

decision (higher prices, and reliability) are the

responsibility of the locally elected officials, not

the Corps.

A.R. at 917. The comment is entirely proper. The need of

the project for the public is adequately reflected in the votes

of the citizens of Bessemer, who will be the ones directly

affected by the City’s choice to build an independent water

system. Their ability to express the fullness of their need by

vote insures that their interests are considered.

Even this statement by the district engineer, however, is

superfluous. Being required only to consider the tangible

59a

Appendix B

needs for the intake and pipeline construction and those

things impacted that are within the scope of the Corps’

review, the district engineer was not required to find that

the public interest in the impacts related to the entire project

were assured by the votes of the citizens of Bessemer, only

that the need for the project outweighed the need for

resources potentially damaged by the project.

The district engineer further considered the weight of

public and private needs of those who did not have voting

power over the Bessemer council.

Although the granting of Bessemer’s requested

permit will provide a new water-withdrawal point

on the Black Warrior River, it should not increase

the demand for water in the short-term. The water

to be withdrawn by Bessemer is currently being

withdrawn by the [Water Works] at other

locations and sold to Bessemer. If [the Water

Works] developed new customers to replace

Bessemer, additional demands on water resources

would result It is estimated that up to 70 percent

of the water withdrawn by Bessemer would be

returned to the Black Warrior River as treated

waste water thus reducing the net withdrawal to

7.5 [million gallons per day].

The proposed Bessemer intake is downstream of

all the [Water Works] intakes and will probably

not impact the [Water Works] withdrawal except

during droughts when the Bankhead Lake level

is low. Future increases in water withdrawals will

SN ne Se ee eae wlan

60a

Appendix B

likely impact navigation depths during droughts,

however, the allocation of water for multi-purpose

use is primarily a State issue. If navigational

servitude is impaired, Federal authority to protect

navigation could preempt the State’s right to

allocate water use.

A.R. at 917. To the extent that the district engineer’s

discussion dealt with the issue of water allocation, it was

superfluous. Otherwise, it was an appropriate consideration

of public and private need with respect to a navigational

servitude on the Black Warrior River.

Finally, the district engineer addressed the impacts of

the construction itself:

In response to the public notice, letters of no

objection or authorization were received from the

U.S. Fish and Wildlife Service, National Marine

Fisheries Service, Alabama Department of

Conservation and Natural Resources, Alabama

Department of Environmental Management,

Alabama State Docks, and the Alabama Historical

Commission. Coordination with these agencies

indicates that the proposed project will not

adversely impact fish and wildlife, wetlands,

threatened and endangered species, properties on

or eligible for the National Register of Historic

Places, navigation, and water quality.

A.R. at 916. Because there were no impacts upon these

resources, there was no requirement that the district engineer

6la

Appendix B

weigh the public and private need for these resources against

the need for the construction itself. The Corps appropriately

addressed the public and private needs of the proposed action.

D. Alternative Sources.

The Water Works next challenges the Corps’ analysis

of alternatives to the proposed action, contending that it was

insufficient. 33 C.F.R. § 320.4(a)(2)(ii) states:

The following ... will be considered in the

evaluation of every application:

Where there are unresolved conflicts as to

resource use, the practicability of using reasonable

alternative locations and methods to accomplish

the objective of the proposed structure or

work. ...

In particular, the Water Works is concerned that the Corps

failed to consider the “no-action” alternative to construction

of the intake facility. The Water Works’ contentions are,

however, directed at the Corps’ initial permitting decision,

not the revised permitting decision upon which the present

action is based. The court will nonetheless address these

concerns as though they were directed at the revised

permitting decision.

Regarding alternatives, the Corps stated:

7. ALTERNATIVES TO THE PROPOSED

ACTION:

62a

Appendix B

a. Birmingham Water Works/No Action

Alternative: This alternative would require the

applicant to continue to purchase water from the

Birmingham Water Works. This alternative would

require no permit action and would eliminate the

minor environmental impacts associated with the

proposed project Since the overall project purpose

is to provide an independent water supply system,

including an independent supply source, this

alternative does not meet the overall project

purpose and is therefore not considered to be

practicable.

b. Groundwater/No Action Alternative: The

subsurface geologic formations in the project area

do not yield groundwater in sufficient quantities

to meet the applicant’s needs. Groundwater is not

a practicable alternative.

c. Warrior River Water Authority: The City of

Bessemer and the Warrior River Authority

attempted to negotiate an agreement which would

provide the applicant with an independent water

supply system without the need for the proposed

water intake structure. A water transmission

pipeline and treatment plant and the

environmental impacts associated with these

activities would remain. Because an agreement

was not reached with the Warrior River Water

Authority, this alternative is not available, thus

not practicable.

63a

Appendix B

A.R. at 910. The Corps reasonably discounted each of these

alternatives. The no-action alternative requiring purchases

of water from the Water Works was appropriately discounted

as not in line with the project’s purposes. The Corps’ section

404 guidelines, which provide rélevant guidance in the

present alternatives analysis state:

An alternative is practicable if it is available and

capable of being done after taking into

consideration cost, existing technology, and

logistics in light of overall prcject purposes.

40 C.F.R. § 230.10(a)(2).'* The alternative of purchasing

water from the Water Works flouts the purpose of Bessemer’s

proposal and is therefore not an available alternative.

Further, whether practicable alternatives to the entire

project (as opposed to the proposed activity to be permitted)

exist is outside of the scope of the district engineer’s analysis.

As section 320.4(a)(2)(ii) states, the Corps is only to consider

practicable alternatives to “the proposed structure or work.”

The Corps was not required to consider obtaining water from

the Water Works as an alternative to the construction of an

entirely independent water supply by Bessemer.

In spite of plaintiff's assertions to the contrary, the Corps

also considered carefully the option of Bessemer’s obtaining

water through use of the Warrior River Water Authority’s

18. The court is employing the section 404 guidelines only as

an aid for clarification, not as a substitute for the alternatives analysis

to be conducted in the public interest review.

64a

Appendix B

intake structure. The record indicates that attempts by

Bessemer at exercising this option floundered, A.R. at 842-

44. The district engineer’s determination that no practicable

alternatives existed was neither arbitrary nor capricious.'”

E. Water Supply.

The plaintiff next contends that the Corps failed to

conduct an adequate analysis based upon water supply and

conservation. In arguing such, the Water Works states:

The Corps’ regulations clarify that in evaluating

a proposed project’s effects on water supply and

conservation, the Corps must consider that:

Water is an essential resource, basic to

human survival, economic growth, and

the natural environment. Water

conservation requires the efficient use

of water resources in all actions which

involve the significant use of water or

that significantly affect the availability

of water for alternative uses including

19. Although the Water Works never raises the issue and it is

therefore not properly before the court for determination, the court

has been unable to find any basis in the record (although it might be

due to an oversight by this court) for the Corps’ determination that

groundwater wells were an insufficient supply source. However, as

this issue was not raised by the plaintiff (and that there is a basis

buried somewhere in the near-thousand-page record), the court

cannot foreclose the defendants’ summary judgment motion(s) on

this ground.

65a

Appendix B

Opportunities to reduce demand and

improve efficiency in order to minimize

new supply requirements. Actions

affecting water quantities are subject to

- Congressional policy as stated in section

101(g) of the Clean Water Act which

provides that the authority of states to

allocate water quantities shall not be

superceded, abrogated, or otherwise

impaired.

Plaintiff's Brief in Response to Motion for Summary

Judgment at 35 (quoting 33 C.F.R. § 320.4(m)). The

defendants argue that the Corps has no authority to consider

the allocation of water among communities, as the plaintiff

suggests. Section 101(g) of the Clean Water Act, 33 U.S.C.

§ 1251(g) (emphasis added), states:

It is the policy of Congress that the authority of

each State to allocate quantities of water within

its jurisdiction shall not be superseded, abrogated

or otherwise impaired by this chapter. It is the

further policy of Congress that nothing in this

chapter shall be construed to supersede or

abrogate rights to quantities of water which have

been established by any State. Federal agencies

shall co-operate with State and local agencies to

develop comprehensive solutions to prevent,

reduce and eliminate pollution in concert with

programs for managing water resources.

The Water Works argues that a construction of section 101(g)

of the Clean Water Act (also known as the Wallop

66a

Appendix B

amendment) that takes away the Corps’ authority to address

the allocation of water resources would render 33 C.F.R.

§ 320.4(m) nugatory. The court does not see this. Section

320.4(m) merely underscores the policy announced in the

Wallop amendment that the Corps not make its permitting

decisions on the basis of water supply, thereby overruling

state law water allocation determinations.

In debate, Senator Wallop, sponsor of the amendment

that became section 101(g), stated:

The requirements of section 402 and 404 [Clean

Water Act] permits may incidentally affect

individual water rights. .. . It is not the purpose

of this amendment to prohibit those incidental

effects. It is the purpose of this amendment to

insure that State allocation systems are not

subverted, and that effects on individual rights,

if any, are prompted by legitimate and necessary

water quality considerations. This amendment is

an attempt to recognize the historic allocation

rights contained in State constitutions. It is

designed to protect historic rights from

mischievous abrogation by those who would use

an act, designed solely to protect water quality

and wetlands, for other purposes. It does not

interfere with the legitimate purposes for which

the act was designed.

3 Leg. Hist. 532 (Senate Debate, Dec. 15, 1977). See also

United States v. Akers, 785 F.2d 814, 820-21 (9th Cir. 1986)

(stating that water allocation is only relevant in the permitting

67a

Appendix B

process if it is clear that federal environmental concerns

conflict with state law water allocation. In such instances,

accommodation between the federal and state interests is to

be obtained through the permitting process. Such is not the

case here.). As is clear from the above, the Wallop

amendment was meant to prevent an entity, such as the Water

Works, that had found itself unable to prevent reallocation

of water resources under state law to use the Corps’

permitting process to block the allocation on the ground that

the allegedly aggrieved entity was somehow a better water

source.

The Water Works further contends that the Tenth Circuit

Court of Appeais, in Riverside Irrigation District v. Andrews,

758 F.2d 508 (10th Cir.1985), held that Congress did not

intend to limit the Corps’ ability to consider water allocation

in the issuance of permits. Instead, argues the plaintiff,

Congress’ intent was merely that the Corps find an

accommodation between state water allocation and federal

interests. The plaintiff's argument is unavailing. Riverside

involved the denial of issuance of a nationwide permit, rather

than an individual permit as is sought by Bessemer. In

Riverside, the Tenth Circuit found that the Corps had the

statutory authority to consider water quantity in the grant of

nationwide permits. Id. at 512. Unlike a individual permitting

analysis, for which no statute exists permitting an

investigation of water quality, in a nationwide permitting

decisions, “[s]ection 101(g), which is only a general policy

statement ‘cannot nullify a clear and specific grant of

jurisdiction, even if the particular grant seems inconsistent

with the broadly stated purpose.’ ” Id. at 513 (citing

Connecticut Light and Power Co. v. Federal Power

68a

Appendix B

Commission, 324 U.S. 515, 527, 65 S.Ct. 749, 754-55, 89

L.Ed. 1150 (1945)).

F. Eccnomic Impacts.

The Water Works argues that the Corps improperly

neglected to conduct an analysis based upon the economic

impacts of the project. The Water Works’ arguments raised

on this issue are largely a rehash of those raised in its

argument that the Corps failed to perform a needs analysis.

The only added wrinkle in the plaintiff's argument that an

economic analysis was necessary is its discussion of Van

Abbema v. Fornell, 807 F.2d 633 (7th Cir.1986). The

arguments related to this case and the Corps failure to conduct

a proper economic analysis relates to the adequacy of the

Corps’ NEPA review, not the public interest review. The

court notes, with respect to the public interest review, that

the Corps is only required to consider the economics of the

proposed action if it is of significant import to the decision

to permit. See 33 C.F.R. § 320.4(a)(3). Economic impact

does not appear to be a significant feature of the decision to

grant or deny the permit because the focus of the study is

not upon the value of the entire Bessemer water project, but

upon the construction of an intake structure and an associated

pipeline.

The Corps did address the economics of building the

entire project, as the Water Works demands, although no

such analysis was required:

The [Water Works] contends that Bessemer’s

proposed water system would cost Bessemer

69a

Appendix B

between 27 percent and 49 percent more annually

than does water currently supplied by the [Water

Works]. [The Water Works] also contends that

the Bessemer system would require that [the

Water Works] reallocate its current water to other

large customers, and place a “demand charge” on

Bessemer if the [Water Works] is to remain as a

back-up supply. [The Water Works] states that

its other customers may have to absorb the loss

of Bessemer revenues through rate increases for

water.

A.R. at 915-16. The district engineer responded to these

concerns:

The decision by the City of Bessemer to seek its

own water supply and the consequences of the

decision (higher prices, and reliability) are the

responsibility of the locally elected officials, not

the Corps. ...

A.R. at 917. The Corps determination was not arbitrary and

Capricious.

G. Water Quality.

The Water Works contends that the Corps failed to

conduct an adequate analysis of the water quality impacts of

the decision to permit the construction of the intake structure

and pipeline. First, states the Water Works, the Alabama

Department of Environmental Management (“ADEM”)

issued a water quality certificate for the project based on its

70a

Appendix B

review of the public notice and “all associated materials

submitted related to the proposed project.” Because the

materials submitted to ADEM did not contain information

relating to the pipeline, argues the Water Works, its water

quality certificate was based on incomplete data and cannot

support the Corps’ determination that water quality would

not be severely adversely affected. Second, argues the

plaintiff, by the time that the permitting decision was made,

the water quality certificate had expired.

The defendants respond that the inadequacies of the

water quality certificate are irrelevant to the Corps’

permitting decision and the concerns of the Water Works

should be taken up with the ADEM. Further, answers the

defendants, the Corps did not confine its consideration of

water quality to the water quality certificate issued by

ADEM.

33 C.F.R. § 320.4(d) sets out the extent of the district

engineer’s review of the impacts of water quality:

Water quality. Applications for permits for

activities which may adversely affect the quality

of waters of the United States will be evaluated

for compliance with applicable effluent

limitations and water quality standards, during the

construction and subsequent operation of the

proposed activity. The evaluation should include

the consideration of both point and non-point

sources of pollution. It should be noted, however,

that the Clean Water Act assigns responsibility

for control of non-point sources of pollution to

EE

Tla

Appendix B

the states. Certification of compliance with

applicable effluent limitations and water quality

standards required under provisions of section 401

of the Clean Water Act will be considered

conclusive with respect to water quality

considerations unless the Regional Administrator,

Environmental Protection Agency (EPA), advises

of other water quality aspects to be taken into

consideration.

The district engineer stated in its section 404 evaluation of

the “Potential Impacts on Physical and Chemical

Characteristics of the Aquatic Ecosystem”:

b. Water, Suspended Particulates and Turbidity:

Most of the dredged/excavated material will be

discharged and confined to upland sites. There

will be a temporary short term, increase in the

water turbidity during dredging and pipeline

construction, which will be temporary and will

subside upon completion of work. Best

management practices to minimize turbidity will

be required, if a permit is issued. See paragraph

1 1.a for other turbidity limiting measures required

by the [ADEM]. Impacts on photosynthesis, si ght-

dependent species, dissolved oxygen, water

chemistry (including nutrients, organic material,

color, odor and taste) and aesthetics should not

be significant because of the small discharge

volume, nature of the discharged material (alluvial

soils, and commercially obtained crushed stone),

limited area of the discharge sites, short duration

Ge

72a

Appendix B

of work and the requirements of the ADEM water

quality certification.

A.R. 950. The district engineer appropriately relied upon

determinations by ADEM and, in addition, fully considered

the effects of the proposed activity on water quality. In

addition, because the water quality conditions imposed in

the reissued permit are based upon non-site-specific good

construction practices, the district engineer’s evaluation of

effects on water quality was not arbitrary and capricious.

H. Threatened and Endangered Species.

With respect to endangered and threatened species, the

district engineer stated:

Endangered and Threatened Species: In response

to the public notice, the U.S. Fish and Wildlife

Service recommended the entire area that could

be impacted in and adjacent to the Black Warrior

River be surveyed for the endangered Flattened

Musk Turtle (Sternotherus depressus).

The survey was conducted by a qualified biologist

and a report was submitted to the Fish and

Wildlife Service. The report concluded that it is

unlikely the site immediately adjacent to the

proposed construction site has a resident

population of Flattened Musk turtles. Although

suitable habitat exists several hundred yards

upstream and downstream, construction impacts

should be very localized and should not impact

those potential resident populations.

73a

Appendix B

Although the pipeline and treatment plant sites

are within the range of several Federally listed

endangered species, due to the limited nature of

the work, the proposed work should not impact

any listed endangered or threatened species or

critical habitat for such species. By letter dated

22 March 1996, Mr. Larry E. Goldman, Field

Supervisor, U.S. Fish and Wildlife Service wrote:

“No significant adverse effects on fish and

wildlife resources are expected to result from this

proposed work. Therefore, we have no objections

to issuance of this permit.”

After written consultation . .. with the U.S. Fish

and Wildlife Service in accordance with 50 CFR

Part 402, it is my determination that the proposed

project (intake, pipeline and treatment plant) will

not likely jeopardize the continued existence of

any listed species of result in the destruction of

[sic] adverse modification of critical habitat.

A.R. at 906-07. The plaintiff argues that the Corps did not

evaluate what impacts operation and maintenance of the

intake structure and pipeline would have on the flattened

musk turtle, an endangered species. The defendants answer

that the Corps properly relied upon a determination by the

U.S. Fish and Wildlife Service that no significant adverse

effects on threatened or endangered species would occur.

Because the U.S. Fish and Wildlife Service is to consider

the impacts both of construction and operation at the site,

the defendants argue, the Corps properly relied upon the

determination of the U.S. Fish and Wildlife Service in

coming to its decision.

74a

Appendix B

33 C.F.R. § 320.4(c) states:

Fish and wildlife. In accordance with the Fish and

Wildlife Coordination Act (paragraph 320.3(e) of

this section) district engineers will consult with

the Regional Director, U.S. Fish and Wildlife

Service, the Regional Director, National Marine

Fisheries Service, and the head of the agency

responsible for fish and wildlife for the state in

which work is to be performed, with a view to

the conservation of wildlife resources by

prevention of their direct and indirect loss and

damage due to the activity proposed in a permit

application. The Army will give fill consideration

to the views of those agencies on fish and wildlife

matters in deciding on the issuance, denial, or

conditioning of individual or general permits.

The Corps consulted with the appropriate agencies and made

its decision in consultation with them. The determination

that little harm would come to the flattened musk turtle was

not arbitrary and capricious.

The plaintiff also contends that the Corps’ analysis of

the effects of construction and maintenance of the intake

structure and pipeline on the mussel population was wrong

because the study from which the Corps’ conclusions were

drawn were taken at a “bad” time of year. The court is not to

remand agency action because the data on which the decision

is made was drawn at an infortuitous time. The court’s review

is only to address whether substantial evidence exists to

support the agency decision, such as is present here. The

decision in this regard was not arbitrary and capricious.

75a

Appendix B

III. SECTION 404(B)(1) GUIDELINES FOR

SPECIFICATION OF DISPOSAL SITES FOR DREDGED

AND FILL MATERIAL.

The plaintiff contends that two errors occurred in the

Corps’ section 404(b)(1) guidelines review. First, claims the

plaintiff, the district engineer failed to consider impacts of

the Corps’ action on human uses of the water and, second,

the district engineer failed to make an appropriate evaluation

of alternatives to the proposed “dredge and fill” action.

A. Impacts on Human Uses.

The plaintiff contends that the Corps failed to adequately

consider the impacts of the “dredge and fill” action on human

uses of the water. The Water Works states that the Corps,

although it was required to consider the impact of the dredge

and fill activity on municipal and private water supplies, did

not properly consider the effects of the addition of a twenty-

five million gallon per day withdrawal site to the Black

Warrior River on the quantity of water available for

consumers. The defendants respond that the Corps was not

required to consider the consequences of the withdrawal of

water from the Black Warrior River under its section

404(b)(1) review, but only the impacts of the dredge and fill

activity itself.

40 C.F.R. § 230.5 states:

In evaluating whether a particular discharge site

may be specified, the permitting authority should

use the Guidelines in the following sequence:

76a

Appendix B

(f) Identify and evaluate any special or

critical characteristics of the candidate

disposal site, and surrounding areas

which might be affected by use of such

site, related to their living communities

or human uses... .

In 40 C.F.R. Pt. 230, Subpt. F, the guidelines specify the

factors relevant to human uses that should be considered by

the Corps. Section 230.50 concerns municipal and private

water supplies:

(a) Municipal and private water supplies consist

of surface water or ground water which is directed

to the intake of a municipal or private water

supply system.

(b) Possible loss of values: Discharges can affect

the quality of water supplies with respect to color,

taste, odor, chemical content and suspended

particulate concentration, in such a way as to

reduce the fitness of the water for consumption.

Water can be rendered unpalatable or unhealthy

by the addition of suspended particulates, viruses

and pathogenic organisms, and dissolved

materials. The expense of removing such

substances before the water is delivered for

consumption can be high. Discharges may also

affect the quantity of water available for municipal

and private water supplies. In addition, certain

commonly used water treatment chemicals have

the potential for combining with some suspended

77a

Appendix B

or dissolved substances from dredged or fill

material to form other products that can have a

toxic effect on consumers.

The Water Works’ contention about water supply is

misplaced. Section 230.50 does not require the Corps to

consider the impacts of withdrawal of water on supply in its

section 404(b)(1) review, only the impacts on water supply

caused by the addition of fill (and particulate matter) into

the water.

B. Practicable Alternatives.

In conducting its 404(b)(1) guidelines analysis, the Corps

is to consider practicable alternatives to the action requiring

the discharge of dredge or fill material:

Although all requirements in § 230.10 must be

met, the compliance evaluation procedures will

vary to reflect the seriousness of the potential for

adverse impacts on the aquatic ecosystems posed

by specific dredged or fill material discharge

activities.

(a) Except as provided under section 404(b)(2),

no discharge of dredged or fill material shal] be

permitted if there is a practicable alternative to

the proposed discharge which would have less

adverse impact on the aquatic ecosystem, so long

as the alternative does not have other Significant

adverse environmental consequences.

78a

Appendix B

(1) For the purpose of this requirement,

practicable alternatives include, but are not

limited to:

(i) Activities which do not involve a

discharge of dredged or fill material into

the waters of the United States or ocean

waters;

(ii) Discharge of dredged or fill

material at other locations in waters of

the United States or ocean waters;

(2) An alternative is practicable if it is available

and capable of being done after taking into

consideration cost, existing technology, and

logistics in light of overall project purposes. If it

is otherwise a practicable alternative, an area not

presently owned by the applicant which could

reasonably be obtained, utilized, expanded or

managed in order to fulfill the basic purpose of

the proposed activity may be considered.

40 C.F.R. § 230.10(a)(1) & (2).

The plaintiff argues that the no-action alternative of

purchasing water from the Water Works was a practicable

alternative that would have a “less adverse impact on the

aquatic ecosystem.” The Water Works claims that because

the purchase of water from it would require no discharge

into the waters of the United States, it is a preferred

alternative that the Corps was required to recognize.

79a

Appendix B

The defendants respond to this that the purchase of water

from the Water Works is not a practicable alternative because

the purchase does not conform to the overall project purpose

of providing Bessemer with an independent water system.

The plaintiff answers the defendants by contending that the

Corps gerrymandered the project purpose such that the

alternative of water purchase from the Water Works was not

practicable. The court does not see any gerrymandering of

the project purpose to avoid consideration of water purchase

from the Water Works. It is clear to this court from the

administrative record that Bessemer’s incipient desire was

to sever its reliance on the Water Works and the Water Works

control over those who must depend upon it for water. See

National Wildlife Federation v. Whistler, 27 F.3d 1341, 1345

(8th Cir.1994).

IV. NATIONAL ENVIRONMENTAL POLICY ACT

REVIEW.

The plaintiff's final claim is that the Corps failed to

conduct a proper alternatives analysis in its environmental

assessment. The court must first determine the standard of

review required by NEPA. In North Buckhead Civic

Association v. Skinner, 903 F.2d 1533, 1538 (11th Cir. 1990),

the Eleventh Circuit Court of Appeals determined that an

arbitrary and capricious standard is the proper standard of

review over a NEPA determination.

In Marsh v. Oregon Natural Resources Councill,

490 U.S. 360, 109 S.Ct. 1851, 104 L.Ed.2d 377

(1989)], the Supreme Court considered the

question of judicial review under NEPA and

80a

Appendix B

explicitly rejected the reasonableness standard.

The Court adopted instead the arbitrary and

capricious standard as set forth in § 706(2)(A) of

the Admmistrative Procedure Act. We, therefore,

adopt the arbitrary and capricious standard when

reviewing agency action in NEPA cases; if the

agency action was not arbitrary or capricious, it

should not be set aside.

The NEPA implementation regulations state that “the

EA shall include a discussion of the reasonable alternatives

which are to be considered by the ultimate decision-maker.”

33 C.F.R. Pt. 325 App. B § 7.a. As demonstrated in the

court’s discussion of the public interest review, all

alternatives were discussed and reasonably considered.

Conclusion

For the foregoing reasons the defendants’ motion(s) for

summary judgment will be GRANTED. The plaintiff's

motion will be DENIED. The case will be DISMISSED, with

prejudice.

8la

APPENDIX C — OPINION OF THE UNITED STATES

COURT OF APPEALS FOR THE ELEVENTH

CIRCUIT DENYING PETITION FOR REHEARING

DATED, ENTERED AND FILED MAY 28, 1999

IN THE UNITED STATES COURT OF APPEALS

FOR THE ELEVENTH CIRCUIT

No. 97-6882

WATER WORKS & SEWER BOARD OF THE CITY

OF BIRMINGHAM, an Alabama public corporation,

Plaintiff-Appellant,

versus

UNITED STATES ARMY CORPS OF ENGINEERS, THE,

a federal agency; CITY OF BESSEMER, ALABAMA, THE,

a municipal corporation, et al.,

Defendants- Appellees.

On Appeal from the United States District Court for the

Northern District of Alabama

BEFORE: HATCHETT, Chief Judge, BIRCH, Circuit Judge,

and KEITH*, Senior Circuit Judge.

* Honorable Damon J. Keith, Senior U.S. Circuit Judge for

the Sixth Circuit, sitting by designation.

82a

Appendix C

PER CURIAM:

The petition(s) for rehearing filed by appellant is”

DENIED.

ENTERED FOR THE COURT:

s/ [illegible]

UNITED STATES CIRCUIT JUDGE

83a

APPENDIX D — RELEVANT STATUTES

AND REGULATIONS

33 U.S.C. § 403

§ 403. Obstruction of navigable waters generally;

wharves; piers, etc.; excavations and filling in

The creation of any obstruction not affirmatively

authorized by Congress, to the navigable capacity of any of

the waters of the United States is prohibited; and it shall not

be lawful to build or commence the building of any wharf,

pier, dolphin, boom, weir, breakwater, bulkhead, jetty, or

other structures in any port, roadstead, haven, harbor, canal,

navigable river, or other water of the United States, outside

established harbor lines, or where no harbor lines have been

established, except on plans recommended by the Chief of

Engineers and authorized by the Secretary of the Army; and

it shall not be lawful to excavate or fill, or in any manner to

alter or modify the course, location, condition, or Capacity

of, any port, roadstead, haven, harbor, canal, lake, harbor of

refuge, or inclosure within the limits of any breakwater, or

of the channel of any navigable water of the United States,

unless the work has been recommended by the Chief of

Engineers and authorized by the Secretary of the Army prior

to beginning the same.

84a

Appendix D

33 U.S.C. § 1251 (g)

SUBCHAPTER I — RESEARCH AND

RELATED PROGRAMS

§ 1251. Congressional declaration of goals and policy

* * *

(g) Authority of States over water

It is the policy of Congress that the authority of each

State to allocate quantities of water within its jurisdiction

shall not be superseded, abrogated or otherwise impaired by

this chapter. It is the further policy of Congress that nothing

in this chapter shall be construed to supersede or abrogate

rights to quantities of water which have been established by

any State. Federal agencies shall co-operate with State and

local agencies to develop comprehensive solutions to

prevent, reduce and eliminate pollution in concert with

programs for managing water resources.

* * *

33 U.S.C. § 1344(a) and (b)

§ 1344. Permits for dredged or fill material

(a) Discharge into navigable waters

at specified disposal sites

The Secretary may issue permits, after notice and

opportunity for public hearings for the discharge of dredged

85a

Appendix D

or fill material into the navigable waters at specified disposal

sites. Not later than the fifteenth day after the date an

applicant submits all the information required to complete

an application for a permit under this subsection, the

Secretary shall publish the notice required by this subsection.

(b) Specification for disposal sites

Subject to subsection (c) of this section, each such

disposal site shall be specified for each such permit by the

Secretary (1) through the application of guidelines developed

by the Administrator, in conjunction with the Secretary,

which guidelines shall be based upon criteria comparable to

the criteria applicable to the territorial seas, the contiguous

zone, and the ocean under section 1343(c) of this title, and

(2) in any case where such guidelines under clause (1) alone

would prohibit the specification of a site, through the

application additionally of the economic impact of the site

on navigation and anchorage.

* aa .

33 U.S.C. § 1370

§ 1370. State Authority

Except as expressly provided in this chapter, nothing in

this chapter shall (1) preclude or deny the right of any State

or political subdivision thereof or interstate agency to adopt

or enforce (A) any standard or limitation respecting

discharges of pollutants, or (B) any requirement respecting

control or abatement of pollution; except that if an effluent

86a

Appendix D

limitation, or other limitation, effluent standard, prohibition,

pretreatment standard, or standard of performance is in effect

under this chapter, such State or political subdivision or

interstate agency may not adopt or enforce any effluent

limitation, or other limitation, effluent standard, prohibition,

pretreatment standard, or standard of performance which is

less stringent than the effluent limitation, or other limitation,

effluent standard, prohibition, pretreatment standard, or

standard of performance under this chapter; or (2) be

construed as impairing or in any manner affecting any right

or jurisdiction of the States with respect to the waters

(including boundary waters) of such States.

* * *

42 U.S.C. § 4332(2)(E)

§ 4332. Cooperation of agencies; reports; availability of

information; recommendations; international

and national! coordination of efforts

The Congress authorizes and directs that, to the fullest

extent possible: ... and (2) all agencies of the Federal

Government shall —

(E) study, develop, and describe appropriate alternatives

to recommended courses of action in any proposal which

involves unresolved conflicts concerning alternative uses of

available resources;

87a

Appendix D

33 C.F.R. § 320.4

§ 320.4 General policies for evaluating permit

applications.

The following policies shall be applicable to the review

of all applications for DA permits. Additional policies

specifically applicable to certain types of activities are

identified in 33 CFR parts 321 through 324.

(a) Public Interest Review. (1) The decision whether

to issue a permit will be based on an evaluation of the

probable impacts, including cumulative impacts, of the

proposed activity and its intended use on the public interest.

Evaluation of the probable impact which the proposed

activity may have on the public interest requires a careful

weighing of all those factors which become relevant in each

particular case. The benefits which reasonably may be

expected to accrue from the proposal must be balanced

against its reasonably foreseeable detriments. The decision

whether to authorize a proposal, and if so, the conditions

under which it will be allowed to occur, are therefore

determined by the outcome of this general balancing process.

That decision should reflect the national concern for both

protection and utilization of important resources. All factors

which may be relevant to the proposal must be considered

including the cumulative effects thereof: among those are

conservation, economics, aesthetics, general environmental

concerns, wetlands, historic properties, fish and wildlife

values, flood hazards, floodplain values, land use, navigation,

shore erosion and accretion, recreation, water supply and

conservation, water quality, energy needs, safety, food and

88a

Appendix D

fiber production, mineral needs, considerations of property

ownership and, in general, the needs and welfare of the

people. For activities involving 404 discharges, a permit will

be denied if the discharge that would be authorized by such

permit would not comply with the Environmental Protection

Agency’s 404(b)(1) guidelines. Subject to the preceding

sentence and any other applicable guidelines and criteria (see

§§320.2 and 320.3), a permit will be granted unless the

district engineer determines that it would be contrary to the

public interest.

(2) The following general criteria will be considered in

the evaluation of every application:

(i) The relative extent of the public and private need

for the proposed structure or work:

(11) Where there are unresolved conflicts as to resource

use, the practicability of using reasonable alternative

locations and methods to accomplish the objective of the

proposed structure or work; and

(iii) The extent and permanence of the beneficial and/

or detrimental effects which the proposed structure or work

is likely to have on the public and private uses to which the

area 1s suited.

(3) The specific weight of each factor is determined by

its importance and relevance to the particular proposal.

Accordingly, how important a factor is and how much

consideration it deserves will vary with each proposal. A

specific factor may be given great weight on one proposal,

89a

Appendix D

while it may not be present or as important on another.

However, full consideration and appropriate weight will be

given to all comments, including those of federal, state, and

local agencies, and other experts on matters within their

expertise.

33 C.F.R. Part 325, App. B

APPENDIX B To Part 325 — NEPA IMPLEMENTATION

PROCEDURES FOR THE REGULATORY PROGRAM

* * *

1. Introduction. In keeping with Executive Order 12291

and 40 CFR 1500.2, where interpretive problems arise in

implementing this regulation, and consideration of all other

factors do not give a clear indication of a reasonable

interpretation, the interpretation (consistent with the spirit

and intent of NEPA) which results in the least paperwork

and delay will be used. Specific examples of ways to reduce

paperwork in the NEPA process are found at 40 CFR 1500.4.

Maximum advantage of these recommendations should be

taken.

2. General. This Appendix sets forth implementing

procedures for the Corps regulatory program. For additional

guidance, see the Corps NEPA regulation 33 CFR part 230

and for general policy guidance, see the CEQ regulations 40

CFR 1500-1508.

90a

Appendix D

3. Development of Information and Data. See 40 CFR

1506.5. The district engineer mzy icquire the applicant to

furnish appropriate information that the district engineer

considers necessary for the preparation of an Environmental

Assessment (EA) or Environmental Impact Statement (EIS).

See also 40 CFR 1502.22 regarding incomplete or unavailable

information.

4. Elimination of Duplication with State and Local

Procedures. See 40 CFR 1506.2.

5. Public Involvement. Several paragraphs of this

appendix (paragraphs 7, 8, 11, 13, and 19) provide

information on the requirements for district engineers to

make available to the public certain environmental

documents in accordance with 40 CFR 1506.6.

6. Categorical Exclusions —a. General. Even though

an EA or EIS is not legally mandated for any Federal action

falling within one of the “categorical exclusions,” that fact

does not exempt any Federal action from procedural or

substantive compliance with any other Federal law. For

example, compliance with the Endangered Species Act, the

Clean Water Act, etc., is always mandatory, even for actions

not requiring an EA or EIS. The following activities are not

considered to be major Federal actions significantly affecting

the quality of the human environment and are therefore

categorically excluded from NEPA documentation:

(1) Fixed or floating small private piers, small docks,

boat hoists and boathouses.

91a

Appendix D

(2) Minor utility distribution and collection lines

including irrigation;

(3) Minor maintenance dredging using existing disposal

sites;

(4) Boat launching ramps;

(5) All applications which qualify as letters of

permission (as described at 33 CFR 325.5(b)(2)).

b. Extraordinary Circumstances. District engineers

should be alert for extraordinary circumstances where

normally excluded actions could have substantial

environmental effects and thus require an EA or EIS. For a

period of one year from the effective data of these regulations,

district engineers should maintain an information list on the

type and number of categorical exclusion actions which, due

to extraordinary circumstances, tri ggered the need for an EA/

FONSI or EIS. If a district engineer determines that a

categorical exclusion should be modified, the information

will be furnished to the division engineer who will review

and analyze the actions and circumstances to determine if

there is a basis for recommending a modification to the list

of categorical exclusions. HQUSACE (CECW-OR) will

review recommended changes for Corps-wide consistency

and revise the list accordingly.

7. EA/FONSI Document. (See 40 CFR 1508.9 and

1508.13 for definitions) — a. Environmental Assessment

(EA) and Findings of No Significant Impact (F ONSI). The

EA should normally be combined with other required

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Appendix D

documents (EA/404(b)(1)/SOF/FONSI). “EA” as used

throughout this Appendix normally refers to this combined

document. The district engineer should complete an EA as

soon as practicable after all relevant information is available

(i.e., after the comment period for the public notice of the

permit application has expired) and when the EA is a separate

document it must be completed prior to completion of the

statement of finding (SOF). When the EA confirms that the

impact of the applicant’s proposal is not significant and there

are no “unresolved conflicts concerning alternative uses of

available resources * * *” (section 102(2)(E) of NEPA), and

the proposed activity is a “water dependent” activity as

defined in 40 CFR 230.10(a)(3), the EA need not include a

discussion on alternatives. In all other cases where the district

engineer determines that there are unresolved conflicts

concerning alternative uses of available resources, the EA

shall include a discussion of the reasonable alternatives

which are to be considered by the ultimate decision-maker.

The decision options available to the Corps, which embrace

all of the applicant’s alternatives, are issue the permit, issue

with modifications or deny the permit. Modifications are

limited to those project modifications within the scope of

established permit conditioning policy (See 33 CFR 325.4).

The decision option to deny the permit results in the “no

action” alternative (i.e. no activity requiring a Corps permit).

The combined document normally should not exceed 15

pages and shall conclude with a FONSI (See 40 CFR

1508.13) or a determination that an EIS is required. The

district engineer may delegate the signing of the NEPA

document. Should the EA demonstrate that an EIS is

necessary, the district engineer shall follow the procedures

outlined in paragraph 8 of this Appendix. In those cases

93a

Appendix D

where it is obvious an EIS is required, an EA is not required.

However, the district engineer should document his reasons

for requiring an EIS.

b. Scope of Analysis. (1) In some situations, a permit

applicant may propose to conduct a specific activity requiring

a Department of the Army (DA) permit (e.g., construction

of a pier in a navigable water of the United States) which is

merely one component of a larger project (e.g., construction

of an oil refinery on an upland area). The district engineer

should establish the scope of the NEPA document (e.g., the

EA or EIS) to address the impacts of the specific activity

requiring a DA permit and those portions of the entire project

over which the district engineer has sufficient control and

responsibility to warrant Federal review.

(2) The district engineer is considered to have control

and responsibility for portions of the project beyond the limits

of Corps jurisdiction where the Federal involvement is

sufficient to turn an essentially private action into a Federal

action. These are cases where the environmental consequences

of the larger project are essentially products of the Corps

permit action.

Typical factors to be considered in determining whether

sufficient “control and responsibility” exists include:

(i) Whether or not the regulated activity comprises

“merely a link” in a corridor type project (e.g., a

transportation or utility transmission project).

94a

Appendix D

(ii) Whether there are aspects of the upland facility in

the immediate vicinity of the regulated activity which affect

the location and configuration of the regulated activity.

(iii) The extent to which the entire project will be within

Corps jurisdiction.

(iv) The extent of cumulative Federal control and

responsibility.

A. Federal control and responsibility will include the

portions of the project beyond the limits of Corps jurisdiction

where the cumulative Federal involvement of the Corps and

other Federal agencies is sufficient to grant legal control over

such additional portions of the project. These are cases where

the environmental consequences of the additional portions

of the projects are essentially products of Federal financing,

assistance, direction, regulation, or approval (not including

funding assistance solely in the form of general revenue

sharing funds, with no Federal agency control over the

subsequent use of such funds, and not including judicial or

administrative civil or criminal enforcement actions).

B. In determining whether sufficient cumulative Federal

involvement exists to expand the scope of Federal action

the district engineer should consider whether other Federal

agencies are required to take Federal action under the Fish

and Wildlife Coordination Act (16 U.S.C. 661 et seq.), the

National Historic Preservation Act of 1966 (16 U.S.C. 470

et seq.), the Endangered Species Act of 1973 (16 U.S.C. 1531

ei seq.), Executive Order 11990, Protection of Wetlands, (42

U.S.C. 4321 91977), and other environmental review laws

and executive orders.

95a

Appendix D

C. The district engineer should also refer to paragraphs

8(b) and 8(c) of this appendix for guidance on determining

whether it should be the lead or a cooperating agency in these

situations.

These factors will be added to or modified through

guidance as additional field experience develops.

(3) Examples: If a non-Federal oil refinery, electric

generating plant, or industrial facility is proposed to be built

on an upland site and the only DA permit requirement relates

to a connecting pipeline, supply loading terminal or fill road,

that pipeline, terminal or fill road permit, in and of itself,

normally would not constitute sufficient overall Federal

involvement with the project to justify expanding the scope

of a Corps NEPA document to cover upland portions of the

facility beyond the structures in the immediate vicinity of

the regulated activity that would effect the location and

configuration of the regulated activity.

Similarly, if an applicant seeks a DA permit to fill waters

or wetlands on which other construction or work is proposed,

the control and responsibility of the Corps, as well as its

overall Federal involvement would extend to the portions of

the project to be located on the permitted fill. However, the

NEPA review would be extended to the entire project,

including portions outside waters of the United States, only

if sufficient Federal control and responsibility over the entire

project is determined to exist; that is, if the regulated

activities, and those activities involving regulation, funding,

etc. by other Federal agencies, comprise a substantial portion

of the overall project. In any case, once the scope of analysis

96a

Appendix D

has been defined, the NEPA analysis for that action should

include direct, indirect and cumulative impacts on all Federal

interests within the purview of the NEPA statute. The district

engineer should, whenever practicable, incorporate by

reference and rely upon the reviews of other Federal and

State agencies.

For those regulated activities that comprise merely a link

in a transportation or utility transmission project, the scope

of analysis should address the Federal action, 1.e., the specific

activity requiring a DA permit and any other portion of the

project that is within the control or responsibility of the Corps

of Engineers (or other Federal agencies).

For example, a 50-mile electrical transmission cable

crossing a | 1/4 mile wide river that is a navigable water of

the United States requires a DA permit. Neither the origin

and destination of the cable nor its route to and from the

navigable water, except as the route applies to the location

and configuration of the crossing, are within the control or

responsibility of the Corps of Engineers. Those matters

would not be included in the scope of analysis which, in this

case, would address the impacts of the specific cable

crossing.

Conversely, for those activities that require a DA permit

for a major portion of a transportation or utility transmission

project, so that the Corps permit bears upon the origin and

destination as well as the route of the project outside the

Corps regulatory boundaries, the scope of analysis should

include those portions of the project outside the boundaries

of the Corps section 10/404 regulatory jurisdiction. To use

97a

Appendix D

the same example, if 30 miles of the 50-mile transmission

line crossed wetlands or other “waters of the United States,”

the scope of analysis should reflect impacts of the whole

50-mile transmission line.

For those activities that require a DA permit for a major

portion of a shoreside facility, the scope of analysis should

extend to upland portions of the facility. For example, a

shipping terminal normally requires dredging, wharves,

bulkheads, berthing areas and disposal of dredged material

in order to function. Permits for such activities are normally

considered sufficient Federal control and responsibility to

warrant extending the scope of analysis to include the upland

portions of the facility.

In all cases, the scope of analysis used for analyzing

both impacts and alternatives should be the same scope of

analysis used for analyzing the benefits of a proposal.

* * * *

98a

APPENDIX E — EXCERPTS FROM BRIEF OF

DEFENDANT-APPELLEE, THE CITY

OF BESSEMER, ALABAMA

UNITED STATES COURT OF APPEALS

FOR THE ELEVENTH CIRCUIT

NO. 97-6882

THE WATER WORKS and SEWER BOARD OF THE

CITY OF BIRMINGHAM, an Alabama public corporation,

Plaintiff-Appellant

VS. me

UNITED STATES DEPARTMENT OF THE ARMY,

CORPS OF ENGINEERS; THE CITY OF BESSEMER,

ALABAMA; TOGO D. WEST, JR.; LIEUTENANT

GENERAL A. E. WILLIAMS; and COLONEL WILLIAM

S. VOGEL

Defendants-Appellees

ON APPEAL FROM THE UNITED STATES

DISTRICT COURT FOR THE NORTHERN

DISTRICT OF ALABAMA

BRIEF OF DEFENDANT-APPELLEE,

THE CITY OF BESSEMER, ALABAMA

* * *

99a

Appendix E

[26] Il. THE CORPS OF ENGINEERS PROPERLY

CONCLUDED THAT IT DID NOT HAVE

THE JURISDICTION TO REGULATE OR

ALLOCATE THE WITHDRAWAL OF

WATER FROM THE BLACK WARRIOR

RIVER.

Birmingham contends that the Corps should have

evaluated the issues of water supply, water allocation and

withdrawal of water from the Black Warrior River in deciding

whether to grant or deny a permit to Bessemer. Birmingham

points to a draft study which has not been finalized in support

of its claim that the Corps should have engaged in a decision

regarding allocation of water resources. (Appellant’s Brief

at 15 to 16.)

The applicable provisions of the Clean Water Act, the

Corps of Engineers’ regulations and the Corps of Engineers’

policy guidance specifically exclude from the Corps’ Public

Interest Review considerations of water allocation and water

supply among competing users. 33 C.F.R. § 320.4(m) entitled

“Water Supply and Conservation” provides in pertinent part:

Actions affecting water quantities are subject to

Congressional policy as stated in § 101(g) of the

Clean Water Act which provides that the authority

of states to allocate water quantities shall not be

superseded, abrogated, or otherwise impaired.

This regulation is based upon the express provision of

§ 101(g) of the Clean Water Act which provides in pertinent

part:

100a

Appendix E

[27] Authority of State Over Water.

It is the policy of Congress that the authority of

each state to allocation quantities of water within

each jurisdiction shall not be superseded,

abrogated or otherwise impaired by this chapter.

It is the further policy of Congress that nothing

in this chapter shall be construed to supersede or

abrogate rights to quantities of water which have

been established by any state. Federal agencies

shall cooperate with state and local agencies to

develop comprehensive solutions to prevent,

reduce, and eliminate pollution in concert with

programs for managing resources.

33 U.S.C. § 1251(g).

The Corps of Engineers’ Regulatory Guidance Letter Number

85-6 dated May 2, 1985 provides in pertinent part:

The public interest review criteria generally

require district engineers to issue Corps permits

where all local and state permits have been issued

unless there are overriding factors of national

concern (see 33 C.F.R. § 320.4(j)(4)). Water

quantity considerations, even in those states not

covered by water quantity allocation laws, are

normally considered to be factors of state rather

than national responsibility.

Birmingham contends that the Corps should have

considered whether supply by Birmingham is a better

10la

Appendix E

alternative than an independent Bessemer system, taking into

account water conservation, water allocation and the potential

for shortages. The Corps considered each of Birmingham’s

arguments but concluded:

[28] Corps regulations at 33 CFR 320.4(m) and

guidance contained in Regulatory Guidance Letter

85-6 states that the primary responsibility for

water allocation rests with the states. (R5-35-Vol.

I, tab 143, p. 916.)

The Corps does not have jurisdiction over the

withdrawal or allocation of water from the Black

Warrior River. (R5-35-Vol. I, tab 143, p. 916.)

The Corps’ conclusion in the Administrative Record is

fully supported by the applicable law and regulations.

Birmingham’s contention that the Corps should have

considered water allocation and water conservation issues

is without merit.

Ill. THE CORPS OF ENGINEERS PROPERLY

CONSIDERED THE ISSUE OF NEED.

A. The Need Analysis Is Limited to the Structures

and Work Covered by the Corps Permit.

Birmingham contends that the Corps failed to follow its

regulations because it did not consider whether Bessemer

had a need for an independent water supply system. The

District Court held that the Corps was only required to

evaluate the need for the construction of the water intake

102a

Appendix E

structure and pipeline crossings and that the Corps

regulations did not require it to consider the entire

independent Bessemer water supply system. (R2-47-28.) The

District Court’s conclusion is supported by the Corps

regulations and the Administrative Record in this case.

* * * *

103a

APPENDIX F — EXCERPTS FROM BRIEF

OF DEFENDANT-APPELLEE, UNITED STATES

DEPARTMENT OF ARMY, CORPS OF ENGINEERS

[commencing at page 22]

I

THE CORPS’ PUBLIC INTEREST REVIEW

COMPLIED WITH STATUTORY AND

REGULATORY REQUIREMENTS.

A. The Scope of The Corps’ Public Interest Review Was

Consistent With The Limits Imposed By CWA Sections 101(g)

and 510(2). — Section 101(g) of the CWA provides: “It is

the policy of Congress that the authority of each state to

allocate quantities of water within its jurisdiction shall not

be superseded, abrogated, or otherwise impaired by this

chapter.” 33 U.S.C. § 1251(g). See also 33 C.F.R. § 320.4(m);

Corps Regulatory Guidance Letter (May 2, 1985). A.R. 617.

Under section 101(g), the federal role under the CWA is

limited to addressing water quality; the responsibility for

ensuring that the quantity of water available to a community

is adequate belongs to the state and local governments. James

City County v. EPA, 12 F.3d 1330, 1336 (4th Cir. 1993) (EPA

could properly veto a section 404 permit for construction of

a dam and a reservoir based on environmental issues, without

considering whether there was a viable alternative that would

ensure an adequate water supply for the area).

Section 510(2) of the CWA also establishes that

Congress did not intend for the CWA to limit the States’

authority over water issues except as specifically [23] stated

in the Act. 33 U.S.C. § 1370(a)(2) (“Except as expressly

104a

Appendix F

provided in this chapter, nothing in this chapter shall . . .

(2) be construed as impairing or in any manner affecting the

right or jurisdiction of the States with respect to the waters

(including boundary waters) of such States”). In PUD No. /

of Jefferson County v. Washington Dep't of Ecology, 511

U.S. 700, 720 (1994) (“PUD”) states that “[s]ections 101(g)

and 510(2) preserve the authority of each State to allocate

water quantity as between users.’

These sections do not restrict federal authority where

the federal interests in protecting the environment, including

water quality, are at issue, even where the issue of allocating

water between competing users is also involved. Where both

[24] the state interest in water allocation and the federal

interest in environmental protection are implicated by a

single project, Congress intended that the respective state

and federal agencies would reach an accommodation during

the permitting process. United States v. Akers, 785 F.2d 814,

821 (9th Cir.), cert. denied, 479 U.S. 828 (1986). In addition,

these sections would not apply where the federal government

was responsible for the water supply under another statute.

See, e.g., Water Supply Act, 43 U.S.C. § 390(b). In this case,

8. Petitioner in PUD had applied for the state water quality

certification required by CWA section 401(a)(1), 33 U.S.C.

§ 1341(a)(1), in order to obtain a license ftom the Federal Energy

Regulatory Commission for construction of a hydroelectric plant.

The State conditioned its certification on compliance by petitioner

with minimum stream flow requirements in the operation of the plant.

The Court held that the CWA did not restrict the State’s ability to

limit the amount of water the petitioner could use in operating the

plant and so did not prevent the State from imposing this condition

as part of the certification. 511 U.S. at 720.

105a

Appendix F

however, the allocation of water between the Water Works

and Bessemer’s new system does not implicate federal

interests in protecting water quality, and the Black Warrior

River is not a federal water supply.

As the district court noted, in the Environmental

Assessment (EA at 3-7; A.R. 906-10), the Corps, after

reviewing the permit application and consulting with the

relevant State and federal agencies, concluded that the project

would not adversely impact “fish and wildlife, wetlands,

threatened or endangered species, properties on or eligible

for the National Register of Historic Places, navigation, and

water quality.” See Water Works, 983 F. Supp. at 1076. In

the Guidelines Evaluation, the Corps analyzed the specific

impact of the construction activities on water quality and

concluded that there would be no significant impact.

Guidelines Evaluation at 4; A.R. 950. See Water Works, 983

F. Supp. at 1080. The State of [25] Alabama, by issuing its

water quality certification required by section 401 of the

CWA, 33 U.S.C. § 1341, confirmed that the project will not

adversely impact water quality. A.R. 246.

Subject to sections 101(g) and 510(2),° in this case, the

Corps evaluated, among other things, the probable impacts

“of the proposed activity and its intended use” on the public

interest and then balance the reasonably expected benefits

against the reasonably foreseeable detriments. 33 C.F.R.

9. Both of these statutory provisions are unambiguous

statements of Congressional intent. Chevron, U.S.A., Inc. v. Natural

Resources Defense Council, Inc., 467 U.S. 837 (1984). Therefore,

both the courts and the Corps must must give effect to that intent.

Id. at 842-43.

106a

Appendix F

§ 320.4(a)(1). Section 320.4(a)(2)(ii) required that, as part

of this balancing process, the Corps consider “(t]he relative

extent of the public and private need for the proposed

structure or work.”

The Water Works maintains that the public interest

analysis for the Bessemer permit was inadequate because

the Corps did not evaluate whether the water withdrawals

from the River that would result from the construction of

the [26] intake structure and pipeline were needed to ensure

an adequate water supply for Bessemer in light of the water

supply currently available through purchases from the Water

Works. Br. at 21,27. When the Water Works raised this same

issue during the administrative proceedings, the Corps

responded that “[t]he Corps does not have jurisdiction over

the withdrawal or allocation of water from the Black Warrior

River.” Guidelines Evaluation at 6; A.R. 952. Therefore, the

Corps focused its analysis on the construction of the intake

structure and the pipeline, which are within the Corps’

jurisdiction over navigable waters. /d. See also EA at 13;

A.R. 916.

The Water Works contends that the Corps’ response is

inconsistent with the requirement of section 320.4(a)(1) that

the public interest review address both “the proposed activity

and its intended use.”’ Because the treatment plant is designed

to process up to 25 million gallons of water per day (“mgd”),

the Water Works maintains that the intended use of the intake

structure and the pipeline is to withdraw that amount of water

from the River. Br. at 35. Under the Water Work’s

interpretation of the Corps’ regulations, the Corps was

required to consider whether Bessemer actually needed this

new withdrawal before issuing the permit.

107a

Appendix F

However, in arguing that the Corps was required to

consider the issue of [27] whether Bessemer needed its own

water system, the Water Works does not challenge the Corps’

finding that there would be no impact on water quality, but

asserts only that the Corps did not adequately respond to

statements that the water supply in the Black Warrior River

was already over-allocated between competing uses and that

the Corps should have considered whether Bessemer actually

needed its own system before adding yet another user to this

River. Br. at 24-26.

The Corps concluded that it could not make a permit

decision based on a determination regarding Bessemer’s

“need” to withdraw water from the River instead of

purchasing water from the Water Works without improperly

impairing the State’s authority to allocate water between

Bessemer and the Water Works. EA at 14; A.R. 917

(“allocation of water for multi-purpose use is primarily a

State issue”). Based on this record, the claim that the river

water is over-allocated does not raise environmental issues.

Accordingly, the Corps’ only statutory interest with respect

to the quantity of water withdraw from the Black Warrior

River arises from the Corps’ obligation under the Rivers and

Harbors Act to protect the federal navigational servitude.

See Determination, Public Hearing Request (Oct. 31, 1995);

A.R. 307-08. The Corps resolved this issue by imposing a

special condition in the Bessemer permit that requires the

suspension of all pumping operations if the navigation depths

in Bankhead Lake fall below a specified [28] level.'° A.R.

10. The exact same condition is also included in the section

404 permit issued to the Water Works for the construction of its

intake facility on the Mulberry Fork of the Black Warrior River.

A.R. 613.

108a

Appendix F

357. The Cor

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