Endangered and Threatened Species: Designation of Critical Habitat for Cook Inlet Beluga Whale

DEPARTMENT OF COMMERCE

National Oceanic and Atmospheric Administration

50 CFR Part 226

[Docket No. 090224232-0457-04]

RIN 0648-AX50

Endangered and Threatened Species: Designation of Critical Habitat for Cook Inlet Beluga Whale

AGENCY:

National Marine Fisheries Service (NMFS), National Oceanic and Atmospheric Administration (NOAA), Commerce.

ACTION:

Final rule.

SUMMARY:

We, the National Marine Fisheries Service (NMFS), designate critical habitat for the Cook Inlet beluga whale (

Delphinapterus leucas

) distinct population segment (DPS) under the Endangered Species Act (ESA). Two areas are designated, comprising 7,800 square kilometers (3,013 square miles) of marine habitat. In developing this final rule we considered public and peer review comments, as well as economic impacts and impacts to national security. We have decided in the final rule to exclude the Port of Anchorage (POA) in consideration of national security interest. Additionally, consistent with the proposed rule, portions of military lands were determined to be ineligible for designation as critical habitat. We solicited comments from the public on all aspects of the proposed rule, and conducted four public hearings on the action. Along with the proposed rule, we published a draft economic impacts analysis, entitled “Draft RIR/4(b)(2) Preparatory Assessment/IFRA for the Critical Habitat Designation of Cook Inlet Beluga Whale.” This economic analysis has been completed to support the final designation. See “Final RIR/4(b)(2) Preparatory Assessment/FRFA for the Critical Habitat Designation of Cook Inlet Beluga Whale” for a discussion of these topics.

DATES:

This rule will become effective on May 11, 2011.

ADDRESSES:

The final rule, maps, status reviews, and other materials supporting this final rule can be found on our Web site at:

http://www.fakr.noaa.gov/.

FOR FURTHER INFORMATION CONTACT:

Brad Smith (907-271-3023), Kaja Brix (907-586-7235), or Marta Nammack (301-713-1401).

SUPPLEMENTARY INFORMATION:

Rulemaking Background

We are responsible for determining whether species, subspecies, or distinct population segments (DPSs) are threatened or endangered and for designating critical habitat for these species under the Endangered Species Act (ESA) (16 U.S.C. 1531

et seq.

). On October 22, 2008, we published a Final Rule to list the Cook Inlet beluga whale as an endangered species (73 FR 62919). At the time of listing, we announced our intent to propose critical habitat for the Cook Inlet beluga whales. This critical habitat was subsequently proposed on December 2, 2009 (74 FR 63080). The proposed rule's critical habitat for the Cook Inlet beluga whale was determined by considering information received in response to our Advance Notice of Proposed Rulemaking, sighting reports, satellite telemetry data, The Traditional and Ecological Knowledge of Alaska Natives (TEK), scientific papers and other research, the biology and ecology of the Cook Inlet DPS of beluga whales, and information indicating the presence of one or more of the identified primary constituent elements (PCEs) within certain areas of their range. The proposed rule identified “specific areas” within the geographical area occupied by the Cook Inlet beluga whale to be proposed as critical habitat.

We considered various alternatives to the critical habitat designation for the Cook Inlet beluga whale. The alternative of not designating critical habitat for the Cook Inlet beluga whale would impose no economic, national security, or other relevant impacts, but would not provide any conservation benefit to the species. This alternative was rejected because such an approach does not meet the legal requirements of the ESA and would not provide for the conservation of Cook Inlet beluga whale. The alternative of designating all eligible occupied habitat areas also was considered and rejected, because some areas within the occupied range were not considered to be critical habitat, and did not contain the identified physical or biological features that are essential to the conservation of the Cook Inlet beluga.

An alternative to designating critical habitat within all eligible occupied areas is the designation of critical habitat within a subset of these areas. Under section 4(b)(2) of the ESA, we must consider the economic impacts, impacts to national security, and other relevant impacts of designating any particular area as critical habitat. We have the discretion to exclude any particular area from designation as critical habitat if the benefits of exclusion (

i.e.,

the impacts that would be avoided if an area were excluded from the designation) outweigh the benefits of designation (

i.e.,

the benefits to the Cook Inlet beluga whale if an area were designated), so long as exclusion of the area will not result in extinction of the species. Exclusion under section 4(b)(2) of the ESA of one or more of the areas considered for designation would reduce the total impacts of designation. The determination to exclude any particular areas depends on our ESA 4(b)(2) analysis, which is described in detail in the ESA 4(b)(2) analysis report.

This final rule includes several small changes to the areas proposed as critical habitat and, importantly, excludes under Section 4(b)(2) the Port of Anchorage (POA) from designated critical habitat for reasons relating to national security. We corrected errors within the proposed rule's descriptions of the boundaries for this critical habitat so that the final rule utilizes the coordinate system of degrees, decimal-minutes. We have also changed the sentence structure of the PCEs concerning noise and toxins in the final rule to improve clarity.

The total quantifiable economic impact associated with this final rule is estimated to be between $157,000 to $472,000 (discounted at 7 percent) or $187,000 to $571,000 (discounted at 3 percent). While we have excluded a small portion of the area originally proposed as critical habitat for national security reasons (the POA), that exclusion does not affect the economic impact analysis because the small size of the area indicates that the potential cost-savings are likely nominal (

i.e.,

consultations will continue to occur to ensure proposed activities in those areas do not jeopardize the species or adversely modify or destroy adjacent areas of critical habitat). Additional economic impacts, both costs and benefits, that were not amenable to quantification, but nonetheless important to a complete evaluation of this action, were identified and analyzed qualitatively. Both the quantitative and qualitative economic effects of the final rule are presented, in detail, in the Final Regulatory Impact Review/4(b)(2) Preparatory Assessment/Final Regulatory Flexibility Analysis. We promulgate this final rule because it results in a critical habitat designation that provides for the conservation of the Cook Inlet beluga whale, without economic effects of sufficient significance to warrant an exclusion from designation on that basis alone. Other areas within the species' range did not contain the identified physical or biological features that are essential

to the conservation of the Cook Inlet beluga. This alternative also meets the requirements under the ESA and our joint NMFS-USFWS regulations concerning critical habitat.

Cook Inlet Beluga Whale Biology and Habitat Use

The beluga whale is a small, toothed whale in the family Monodontidae, a family it shares with only the narwhal. Belugas are also known as “white whales” because of the white coloration of the adults. The beluga whale is a northern hemisphere species that inhabits fjords, estuaries, and shallow waters of the Arctic and subarctic oceans. Five distinct stocks of beluga whales are currently recognized in Alaska: Beaufort Sea, eastern Chukchi Sea, eastern Bering Sea, Bristol Bay, and Cook Inlet. The Cook Inlet population is numerically the smallest of these, and is the only one of the five Alaskan stocks occurring south of the Alaska Peninsula in waters of the Gulf of Alaska.

A detailed description of the biology of the Cook Inlet beluga whale may be found in the Proposed Listing Rule (72 FR 19854; April 20, 2007).

Summary of Comments and Responses

We requested comments on the proposed rule to designate critical habitat for Cook Inlet beluga whales and supporting documents (74 FR 63080; December 2, 2009). To facilitate public participation, the proposed rule was made available on our regional web page, and comments were accepted via standard mail, e-mail, and through the Federal eRulemaking portal. In addition to the proposed rule, several draft documents supporting the proposal, including an economic report, were posted. In response to comments, the original 60-day comment period was extended an additional 30 days, ending on March 3, 2010. Public hearings were held in Kenai, Soldotna, Wasilla, and Anchorage, Alaska.

We received 135,463 individual submissions in response to the proposed rule (including public testimony during the four hearings). This included 134,959 form letter submissions and 504 unique submissions. The majority of comments concerned economic and other impacts for consideration for exclusions, the regulatory process for critical habitat designation, legal issues, essential features or PCEs, additions to critical habitat, and biological issues.

We have considered all public comments, and provide responses to all significant issues raised by commenters. We have not responded to comments outside the scope of this rulemaking, such as whether NMFS' prior decision to list the Cook Inlet beluga whale as endangered was proper. We have categorized comments by issue and, where appropriate, combined similar comments.

General Comments on Critical Habitat

Comment 1:

In the proposed rule's discussions at 74 FR at 63084, NMFS has not listed activities that will deter use of or access to Area 1 by beluga whales.

Response:

In the referenced paragraph, we simply endeavored to provide a description of the habitat values and associations within the proposed areas, along with a discussion of why these areas may be sensitive or vulnerable to various stressors. Later in the proposed rule, we provided a brief description of those activities that may adversely modify critical habitat, or that may be affected by the designation.

See

74 FR at 63089. Examples of activities that may deter use or access could include causeways, dams, bridges, or tidal generation projects.

Comment 2:

Cook Inlet anadromous fish runs are healthy and appropriately protected under existing regulatory mechanisms.

Response:

We recognize and acknowledge that the current management structure of the salmon fisheries has generally provided for the sustained harvest and productivity of salmon in Cook Inlet. However, it should also be noted that there are problems inherent with any management system. The size of several king (Chinook) salmon returns in 2009 and 2010 was substantially below average, resulting in closures of sport and commercial fisheries in the Inlet. The Deshka River king salmon runs were extremely low in 2008 and 2009, resulting in closures. The Susitna River sockeye salmon runs failed to meet minimum escapement goals for 5 of 7 years between 2001 and 2007. Sockeye commercial harvests for the Northern District of Cook Inlet fell from an average of 180,000 fish in the 1980s to an average of 26,000 since 2002. The Alaska Department of Fish and Game forecasts Kenai River sockeye runs to be below average for 2010, citing management decisions leading to over-escapement as a contributing factor.

Comment 3:

The final rule should acknowledge the riparian protections under the State's forest practices, as well as other regulations that protect water quality and other protections.

Response:

While there exist myriad environmental and conservation laws, restrictions, and practices at State and local levels, these are not pertinent to this designation unless they concern whether the identified essential features of that habitat “may require special management or protection.” The fact that the State and local governments have instituted such measures is some evidence that these essential features do in fact require special management.

Comment 4:

NMFS should provide supporting evidence for its identification of the tendency for belugas to occur in high concentrations, predisposing them to harm from events such as oil spills, as reason for designation of Area 1. The statement is speculative. This commenter also challenged our evidence that oil spills are a threat to beluga whales or predisposes them to harm, that these areas are susceptible to oil spills, or that spills are likely to occur here.

Response:

We had not proposed this fact to be a “reason” for designating critical habitat. We disagree this statement is speculative, as there are multiple lines of evidence, including NMFS' 2008 Conservation Plan for Cook Inlet Beluga Whale and many peer reviewed studies, that beluga whales occur seasonally in high densities within specific areas of the upper Inlet. Our purpose in these statements was not to provide an exhaustive assessment or analysis of oil spills, but to indicate the ecological attributes of Area 1 to Cook Inlet belugas and to recognize the sensitivities imposed by their habit of occupying relatively small, enclosed areas for feeding and other purposes during the open water months. The occurrence of these whales in high densities here not only predisposes them to potential harm from hazardous material releases, but also disease outbreaks, harassment, poaching, and other factors.

Comment 5:

Additional research is needed to support proper management of the Cook Inlet beluga whales including this critical habitat designation.

Response:

We agree generally that additional research is needed, and we identified in the 2008 Conservation Plan the need to “improve our understanding of the biology of Cook Inlet beluga whales and the factors limiting the population's growth.”

See:

Conservation Plan for the Cook Inlet Beluga Whale (Oct. 2008) at 63. We disagree, however, that additional research is needed to support the designation of critical habitat. The ESA requires NMFS to designate critical habitat concurrently with the listing decision, 16 U.S.C. 1533(a)(3)(A)(i), and to base that decision on the “best scientific data available,”

id.,

section 1533(b)(2). We have used the best scientific data available in designating critical habitat

for the Cook Inlet beluga whale. We are not required to conduct field research prior to designating critical habitat.

Comment 6:

NMFS must link its critical habitat determinations to credible threats, and must fully explain its rationale for designating Area 2 as critical habitat.

Response:

There is no requirement to link designation of critical habitat with threats. We are required to base critical habitat designations on physical or biological features essential to the conservation of the species and which may require special management considerations or protection, as we have done in this rule. Our discussion of potential threats to critical habitat was provided so the reader might better understand the proposed designation in context of the biology of the Cook Inlet beluga whales and the various stressors that may occur in these areas. Such a discussion also assists in the description and evaluation of those activities which may adversely modify the critical habitat or otherwise be affected by the designation. We believe the Proposed Rule presented the best scientific data and information available which justify the inclusion of Area 2 as critical habitat. We described the known or probable habitat attributes of this area, including use for fall and winter feeding, and discussed distribution and dive behavior of these whales within the area, which also support the feeding and overwintering habitat values here. We identified several essential physical and biological features of critical habitat for Cook Inlet beluga whales, established that those features were found within Area 2, and confirmed that they may require special management or protections, as required by the ESA. We agree that present knowledge of the habitat characteristics of Area 2 is less than that of Area 1, and that it is desirable to gather additional data to better understand the habitat needs of beluga whales here. However, we do not find that the existing information, nor the discussion and analysis of the area within the Proposed Rule, were insufficient. Further, none of the commenters provided data or information contradicting the data on which the proposed rule relied.

Physical or Biological Features Essential for Conservation (PCEs)

Comment 7:

We received many comments concerning the PCEs, or essential features, indicating some confusion and uncertainty regarding their function and significance. Others felt that our identification of PCEs was flawed because these are not presently impeding the recovery of Cook Inlet beluga whales, or that the PCE thresholds are set unreasonably. Still others believe that a PCE equates to adverse modification or other objectionable standard by which various activities and projects would be prohibited.

Response:

The ESA defines critical habitat in terms of essential physical or biological features, and Federal regulations require us to focus on these features in the designation process. It is not necessary that a feature be presently impaired or limiting, only that it provide an essential service or function to the conservation of the listed species and may require special management considerations or protection. Also, a PCE is not meant to describe a threshold condition beyond which critical habitat would be adversely modified or destroyed. Rather, potential threats to the PCEs will often be the factors evaluated in making determinations regarding whether a proposed Federal action will adversely modify or destroy critical habitat. For example, we believe an essential physical feature to be the unrestricted passage and movement of beluga whales among critical habitat sites. A project, such as a dam, could potentially isolate parts of the whales' critical habitat and prevent movement among the sites. In evaluating the effects of such a project under section 7 of the ESA, we would consider whether this isolation would impact beluga whales to a degree that critical habitat was no longer functional to the conservation of the species. If it caused the loss of either of these functional values, we would consider this adverse modification. However, the mere fact that the project may isolate parts of the critical habitat or prevent movement among those sites would not, in itself, constitute adverse modification or destruction of critical habitat. Similarly, a project that caused whales to abandon critical habitat may not necessarily result in a determination of adverse modification or destruction of critical habitat, unless such abandonment would preclude the conservation of these whales.

Comment 8:

The essential features identified in the proposed rule are important for beluga survival, but NMFS has not demonstrated these features are limiting the production or recovery of these whales.

Response:

The ESA defines critical habitat in terms of those physical or biological features that are essential to the conservation of the species and which may require special management considerations or protection. The ESA does not define the word “essential.” We agree with the commenter that the identified features are important for beluga conservation, and believe this importance is such that they may be considered “essential.” We disagree, however, that the features must be found to be limiting to the species before they may be considered essential. A limiting factor may be described as one that controls a system or species (such as air), or one that is present in the smallest supply relative to the demands of the system/species (perhaps a prey species). In either case, the ESA contains no requirement that essential features are restricted to those that may be limiting. Our approach will vary to fit the circumstances of a particular species.

Comment 9:

The identified PCEs lack specificity (

e.g.,

“The absence of toxins or other agents of a type or amount harmful to beluga whales”). NMFS should identify threshold values for all PCEs as it has for in-water noise.

Response:

The ESA requires that we premise the designation of critical habitat on essential features, and the regulations at 50 CFR 424.12(b) describe the PCEs as including, but not limited to, roost sites, nesting grounds, spawning sites, water quality or quantity, tides, and vegetation types. Clearly, these descriptions are general in nature and, we believe, far less descriptive than those presented in the proposed rule. We relied on the best scientific data available to provide as much specificity as possible. None of the commenters have provided data allowing us to further refine our description of the PCEs. The condition of adverse modification will be determined, in part, on whether an activity impairs the functional value of the essential features to the point that they cannot provide for the conservation of the species. In adding as much description to these features as permitted by the best scientific data available (

e.g.,

not just “pollutants,” but the “absence of toxins or other agents of a type or amount harmful to beluga whales”) it is our intent to avoid the situation where any activity that may be associated with one or more essential feature would be considered as causing the adverse modification or destruction of critical habitat. We have also modified the wording of this PCE in the final rule to improve clarity.

Comment 10:

NMFS needs to present data to support its explanation for equating “mudflats” with “shallow and nearshore waters proximate to certain tributary streams.” NMFS should defend its rationale for delimiting this feature to waters within the 30-foot (9.1 m) depth contour. NMFS has arbitrarily expanded this PCE beyond that described in Goetz

et al.

(2007).

Response:

Relying on the best scientific data available, the proposed rule explains the habitat attributes and importance of nearshore areas to Cook Inlet beluga whales. These whales selectively occupy these areas during the ice-free months, and may display year-round association with the nearshore zones of Cook Inlet. We believe this affinity is due to feeding strategies and perhaps breeding, calving, molting, and predator avoidance. Research on beluga whales elsewhere has found beluga distribution may be associated with depth and bottom structure, as well as prey abundance. Using these data, we next considered the results of Goetz

et al.

(2007) which found significant associations between summer distributions of Cook Inlet belugas, mudflats, and flow accumulation. The Goetz

et al.

(2007) paper is important in that it provides the first spatial representation of this habitat attribute, and supports the observations of other research as well as the TEK of Alaskan Natives. The paper does not incorporate data on other factors potentially relevant to beluga distribution in Cook Inlet such as water temperatures, turbidities, salinities, or the fish species and strength of fish runs for these waters. That paper states “The occurrence of beluga whales near stream mouths may reflect a feeding strategy whereby belugas take advantage of highly-concentrated fish runs in shallow channels where they are easy to catch”, and found the majority of sightings were within 11.5 km of medium flow accumulation inlets. The Goetz

et al.

(2007) paper, however, is not the sole scientific basis for our determination, nor is it necessarily the most significant. It is clear that many of the areas identified as in the Goetz

et al.

(2007) paper as “mudflats,” are rarely associated with beluga sightings. In reviewing the best scientific data available, we found that whereas the Goetz

et al.

(2007) paper's use of “mudflats” implies a condition of the seafloor material, this feature is best described by its tidal exposure. Therefore, in identifying the PCE, we used the qualifier of waters less than 30 feet (9.1 m) in depth to clarify what was described as “mudflats” by Goetz

et al.

(2007). We also felt that, while this feature covers a range of over 7 miles (11.5 km) in which most whales have been found, a radial distance of 5 miles (8.0 km) from the high and medium flow distribution inlets is more descriptive of the actual distribution of these whales and the essential feature, in consideration of the best aerial and satellite data available.

Comment 11:

NMFS relied too heavily on Goetz

et al.

(2007), a paper with serious flaws. NMFS should have incorporated fish runs into its models, and has arbitrarily ignored this important element.

Response:

We relied on the best scientific data and information available, including models such as the one developed by Goetz

et al.

(2007), in preparing the proposed rule. We did not develop new models as part of the rulemaking, and the ESA does not require us to do so or to conduct field research. Rather, we are required to designate critical habitat on the basis of the best scientific data available. Goetz

et al.

(2007)'s research and paper were not conducted to define critical habitat. Goetz

et al.

(2007) exists as one of several sources we considered during this rulemaking. Both NMFS and the paper itself recognize the paper's limitations from not including various physical and biological variants, most notably anadromous fish species and run strengths. Despite this information, the list of high and medium flow accumulation waters reported in the paper indicate that all such rivers are anadromous fish waters and that flow accumulation has some association, and may be a reasonable proxy, for anadromous fish. The inclusion of fish species or numbers of anadromous fish utilizing these waters would not change the list, but could only add another descriptive layer to this essential feature. The utility of such additional description is unclear and probably non-existent.

Comment 12:

NMFS has incorrectly used Goetz

et al.

(2007) to identify PCEs within Area 2, particularly for winter periods for which this paper did not include data. Applying this model to winter has resulted in NMFS incorrectly identifying habitats that are impossible or highly improbable for belugas to inhabit.

Response:

While we included the Goetz

et al.

(2007) paper in our consideration of scientific research and literature related to critical habitat and adopted its conclusions as representative and supportive of our proposed designation, we are not necessarily in agreement with every statement made within the paper. This is particularly true for the paper's assertion that sea ice in winter makes inhabiting shallow waters too hazardous for marine mammals. While the paper does not define what depths were considered to be “shallow,” there is ample evidence that beluga whales occur in such areas during winter. Indeed, beluga whales are variously described as “ice associated” or “ice dependent” species, and we know of no beluga population that is not found within areas subject to seasonal ice formation. Satellite tagging data (

see

NMFS' 2008 NMFS Conservation Plan for the Cook Inlet Beluga Whale) from Cook Inlet beluga whales indicates that these whales are found in nearshore areas during winter; in fact these data show whales occupying the heads of Turnagain and Knik Arms during periods in which maximum ice coverage would be expected.

While Goetz

et al.

(2007) did not include (or have access to) distribution data for winter months, Goetz

et al.

(2007) presents other information demonstrating the importance of nearshore areas proximate to anadromous fish streams as an essential habitat attribute. This attribute within Area 2 exists during the late summer and fall months, as whales move west and south transitioning from summer habitat in the upper Inlet to winter habitats. During this time, we believe the whales take advantage of the late coho runs along the west side of Cook Inlet. This behavior occurs well before seasonal ice formation (sea ice is much less prevalent in the lower Inlet), and we believe it is reasonable to assume the physical qualities of nearshore feeding habitat near salmon streams in July are similar to those for nearshore feeding habitat near salmon streams in October. The 2008 NMFS Conservation Plan for the Cook Inlet Beluga Whale includes sighting data of beluga whales in the lower Inlet, and suggests these areas were important habitat sites when the beluga whales were more abundant.

Finally, we emphasize the critical habitat boundaries are not drawn around the essential features/PCEs. Rather, these features delineate critical habitat from non-critical habitat. The best scientific data available indicates that the critical habitat area referred to as Area 2 contains anywhere from one to all of the identified physical or biological features essential to the whales' conservation.

Comment 13:

NMFS should list all the waters it considers to be high and medium flow accumulation rivers for purposes of describing the PCEs.

Response:

We have included this list on our Regional website (

see

ADDRESSES

above).

Comment 14:

NMFS should include pink salmon, Pacific herring, and long-finned smelt as PCEs.

Response:

We identified important prey species as essential biological features or PCEs based on the results of research on fatty acid signatures and stable isotope analysis from beluga whale tissue, stomach samples from

Cook Inlet belugas, and traditional knowledge. We did not find the proposed species were well-supported by these sources and cannot determine that they are essential based on current knowledge.

Comment 15:

NMFS' proposed PCE “The absence of toxins or other agents of a type or amount harmful to beluga whales” is too vague. There are readily available data defining the types and amounts of contaminants that would be harmful to beluga whales, but NMFS has not used this information.

Response:

Please see our earlier response to comment #9 regarding specificity within the definitions of essential features and PCEs. We relied on the best scientific data available in designating critical habitat for the Cook Inlet beluga whale. We are not aware of any existing data that would allow for greater specificity concerning harmful contaminant levels in beluga whales, and none of the commenters provided any or indicated a specific source of such data. We recently contracted for an assessment of risks to beluga whales from chemical exposures (URS, 2010), that found “reliable and quantitative information that related measured body burdens to observed adverse effects is lacking, especially within a dose-response context.” Information relating to the presence of persistent organics, measured primarily in the whales' blubber, exists, and there are some studies on the presence of methylmercury and other metals, but very little or no toxicity information is available for beluga whales and other marine mammals regarding the majority of harmful chemicals. The assessment report goes on to state that, even for those few studies in which some threshold values are presented for other species, such studies are fraught with uncertainty and should be viewed only as a preliminary comparison to determine whether further evaluation is warranted.

We believe that, had we employed threshold values of chemicals which arguably cause “harm” to other species, we would have created an assessment methodology for adverse modification of critical habitat that could be both insufficiently protective of these whales and unnecessarily restrictive. The toxin PCE as promulgated provides the best level of specificity possible in light of the best scientific data available. This PCE does not simply include all pollutants; it includes only those of a type and quantity/concentration harmful to beluga whales. Moreover, it is important to note that the introduction of any pollutants that are harmful to beluga whales would require the evaluation of the effect of such pollutants on the PCE, but it would not necessarily equate to adverse modification. We would evaluate the proposal by considering the implications of the harmful pollutants to the PCEs and to the conservation of Cook Inlet beluga whales.

Comment 16:

Unrestricted passage between habitat areas is consistent with the knowledge of the spatial and temporal dynamics of the primary beluga prey species, yet NMFS has shown no evidence that passage is being restricted to the extent of limiting productivity or recovery.

Response:

Please refer to our earlier response to comment #7 concerning limiting aspects of habitat and their relation to essential features and PCEs. We agree that no evidence currently exists indicating that passage among critical habitat areas is impeded to the extent of preventing recovery. The validity of this condition as a PCE is not dependent on whether it is limiting to the population. The Conservation Plan includes discussion of various threats to these whales, many of which could impede access among critical habitat sites. An action that would result in restricted passage would not necessarily result in a finding of adverse modification. Under section 7 of the ESA, we will evaluate a proposed Federal action's potential to destroy or adversely modify critical habitat by considering the implications of any restriction on the movement among critical habitat sites to the conservation of Cook Inlet beluga whales.

Comment 17:

NMFS's proposed PCE “The absence of in-water noise at levels resulting in the abandonment of habitat by Cook Inlet whales” is too vague. NMFS should provide an objective, measurable noise level in the definition of this PCE.

Response:

We developed each PCE based on the best scientific data available. Because empirical data exist to help us understand the noise levels at which beluga whales may react behaviorally or become injured, it is reasonable to assume quantified standards could be developed in the future for this PCE. Existing data, however, are based on relatively few animals held in captivity and the qualitative results of various field observations and research. We currently recognize in-water noise exceeding 120 dB re 1 μPa as the threshold for harassment of marine mammals presented with a continuous noise source, and 160 dB re 1 μPa for impulsive noise. However, ambient (background) in-water noise levels in lower Knik Arm presently exceed 120 dB, and we felt it unnecessarily restrictive to describe this standard as a PCE. Similarly, the 160 dB threshold relates to harassment. We do not have a standard value for the level of noise above which beluga whales may permanently abandon habitat. From research and monitoring of in-water work in Cook Inlet, it is apparent that beluga whales have not abandoned habitat areas due to temporary exposures to noise at this level. Therefore, this numeric standard may also be too restrictive. There exists considerable variability in the reaction of whales to noise, depending on the nature of the noise, life history, behavior, sex, context, tolerance, and adaptation. The science of marine mammal acoustics is very complex and made more difficult within the dynamic setting of Cook Inlet. As a result, we can only assign a qualitative standard to this PCE unless and until data become available allowing us to assign a quantitative standard.

Comment 18:

NMFS should describe the PCE addressing in-water noise as “the absence of in-water noise that results in adverse impacts to the species' survival and recovery.” The commenter points out that noise below levels that may cause whales to abandon habitat areas could still have severe impacts on these animals.

Response:

The commenter's proposed PCE is not that functionally different from the one proposed in one important respect. When we evaluate a Federal action under section 7 of the ESA, we will consider whether the action will introduce noise that will result in the abandonment of critical habitat and whether such abandonment will, in turn, affect the whales' conservation. We will also consider whether the noise would affect the whales' survival because section 7 directs Federal agencies to ensure that their actions do not (a) result in the destruction or adverse modification of critical habitat or (b) jeopardize the continued existence of the species. The commenter's proposed PCE combines these two standards (and conflates them, a formulation which the Ninth Circuit struck down in

Gifford Pinchot Task Force

v.

U.S. Fish & Wildlife Serv.,

378 F.3d 1059 (9th Cir. 2004)).

Comment 19:

The PCE concerning noise should be re-worded to reduce the noise levels permitted to 120 dB or lower, reduce the duration of allowable noise, and reduce the frequency of anthropogenic noise.

Response:

The identified essential features or PCEs are not intended to be limitations or stipulations. They describe various features of the

environment that we consider essential to the conservation of these whales. We do not believe in-water noise levels below 120 dB re 1 μPa are necessary to conserve these whales in all cases. In fact, ambient noise in areas in which these whales occur, such as lower Knik Arm, often exceeds 120 dB. Similarly, behavioral reaction and other consequences of noise exposure (duration and frequency) are difficult to predict. For this reason, we describe this PCE in terms of its effect (abandonment of habitat) rather than a finite quantity or level.

Comment 20:

NMFS fails to identify the existing empirical data, or explain the science and rationale used in establishing the noise PCE, and must provide this information along with an additional public comment period.

Response:

See previous response. The proposed rule stated that empirical data exist on the reaction of beluga whales to in-water noise for harassment and injury, but are lacking regarding reactions such as avoiding certain areas. The NMFS' 2008 Conservation Plan (pp. 58-60, 66-67) provides a detailed description of the issue of noise and Cook Inlet belugas, and includes references to applicable research and traditional knowledge accounts which support the proposed rule's assessment of the importance of sound to beluga whales.

Comment 21:

NMFS needs to acknowledge that beluga whales have co-existed with anthropogenic noise in Cook Inlet for decades and that there is no information or data to indicate noise is a threat or contributing factor to their abundance.

Response:

Our discussion on the effects of noise in the proposed rule is consistent with the 2008 Conservation Plan, which identified noise as a potential threat. That plan presents several reasons why noise may be considered a threat, including the facts that noise is known to cause injury or behavioral changes to beluga whales, and that TEK observations associate diminished presence of belugas with in-water noise. The commenter is correct in stating that no data currently exist to place in-water noise as a contributing factor in the decline of the Cook Inlet belugas.

Comment 22:

NMFS needs to provide further specificity and thresholds in its description of the PCEs for this critical habitat.

Response:

As discussed above, we defined each PCE as specifically as we could, in light of the best scientific data available. Specific, quantitative threshold values would be useful in the formulation of any PCE (

e.g.,

a PCE is gravel between 3.0cm and 7.0cm in diameter, as opposed to spawning material). We are not aware, and none of the commenters provided sources, of any existing data that would allow for greater specificity in the formation of the PCEs for the Cook Inlet beluga whales than that which we used. The ESA does not require us to conduct field research to obtain such data. In light of the time lines for the designation of critical habitat, such research was not feasible.

Comment 23:

NMFS has taken a simplistic approach to designating critical habitat by drawing a line around the primary, currently occupied habitat. NMFS should develop a more discrete approach based on the actual presence of PCEs.

Response:

The critical habitat identified in the proposed rule was not developed by drawing lines around the Cook Inlet beluga whales' currently occupied habitat. To the contrary, large portions of the occupied habitat were not included with the designation because we concluded that those areas do not contain features essential to the Cook Inlet beluga whales' conservation which may require special management considerations or protection. We determined the critical habitat boundaries by confirming the presence of one or more of the identified PCEs/essential features within the critical habitat area, as required by the ESA. We are not required to designate as critical habitat all areas in which a PCE may occur, only that those critical habitat areas contain one or more of the PCEs.

Comment 24:

The presence of the identified PCEs is not uniform throughout Cook Inlet, and NMFS should identify those specific areas that actually contain the important habitat features as critical habitat, rather than the areas in their entirety.

Response:

We included in the designation of critical habitat only those critical habitat areas that contain one or more of the PCEs. The distribution of the identified PCEs is not uniform. However, we believe the ESA provides some latitude to the designating agency here. The implementing regulations at 50 CFR 424.12 discuss the criteria for designating critical habitat. Part 424.12(d) states that “When several habitats, each satisfying the requirements for designation as critical habitat, are located in proximity to one another, an inclusive area may be designated as critical habitat.” Many of the identified PCEs occur throughout Cook Inlet and the proposed critical habitat. Other PCEs, such as shallow areas near median and high flow waters that may be more discretely distributed, are also so numerous as to be nearly a continuous feature. It simply would not be practical or effective in the conservation of the Cook Inlet beluga whale to designate its critical habitat by circumscribing discrete, individual areas around the PCEs.

Comment 25:

The list of PCEs NMFS has identified implies other elements are not necessary for the conservation and recovery of Cook Inlet beluga whales, leaving important gaps that are critical to these whales. NMFS should include as a PCE waters deeper than 30 feet (9.1m) in depth, or demonstrate these are not “essential.”

Response:

While we acknowledge beluga whales are distributed throughout the Inlet, we believe discrete habitat areas exist that are, in fact, “critical” in the sense that they meet the ESA definition and provide an essential feature (

e.g.,

feeding or calving sites) not necessarily found throughout the occupied range of this species/DPS. Further, scientific data, surveys, and TEK provide support for the identification of such discrete areas, but data are lacking which would support the inclusion of all waters of Cook Inlet. The addition of a PCE of waters deeper than 30 feet (9.1m) would likely not result in the inclusion of any additional areas as critical habitat; rather, it would merely confirm the designation of the existing areas. Future revisions to this critical habitat may be made as new scientific data become available that may alter the list of PCEs or the boundaries of this critical habitat.

Comment 26:

NMFS has not provided sufficient rationale to support designation of critical habitat in the nearshore area along the west coast of the lower Inlet nor Kachemak Bay. NMFS should only designate those areas along the west side of the Inlet and in Kachemak Bay that actually contain the habitat features important for belugas.

Response:

We disagree. The west side of the Inlet and Kachemak Bay contain one or more of the identified PCEs, and the habitat value and importance of Area 2, which includes these areas, are described in the rule. The offshore boundary for Area 2 of 2 nautical miles (3.2km) reflects the data gathered in Goetz

et al.

(2007), which found the majority of whale locations to be within 2.7 km of mudflats and 11.5 km of medium flow rivers. While the 11.5 km zone around medium flow rivers would argue for an offset similar to that used in the PCE to describe nearshore waters proximate to certain anadromous waters (5 miles, or 8km), we felt that a distance of 2 nautical miles (3.7 km) was more reflective of the actual habitat use based upon the Goetz

et al.

(2007) model,

expertise and observations of NMFS researchers, and the reports and observations of whales in this area by the Alaska Department of Fish and Game, National Park Service, and private parties. Please note also that the 5-mile (8km) distance around these (high and medium flow) anadromous waters describes the PCE, and not the boundary of the critical habitat.

Comment 27:

There are discrepancies between the depiction and boundaries of critical habitat within the proposed rule, in that there are differing definitions of Areas 1 and 2 in different sections. The map accompanying the rule was not at sufficient resolution to be useful.

Response:

The proposed rule contained several discrepancies in the coordinates and mapping conventions used to describe the boundaries of the critical habitat. Corrections have been made within the final rule. A higher resolution map of this critical habitat will be added to our regional Web site at

http://www.fakr.noaa.gov.

Comment 28:

NMFS' statement that “there remain additional and unmet management needs owing to the fact that none of these management regimes is directed at the conservation and recovery needs of Cook Inlet beluga whales” is objectionable. There is no evidence that supports a lack of effectiveness of any of the management regimes in place in Cook Inlet or that any management or regulatory gap contributed to the endangered listing of Cook Inlet beluga whales, or limits its recovery.

Response:

The quoted statement does not assert that the lack of effective management in Cook Inlet contributed to the whale's listing or limits its recovery. As explained in the proposed rule, the ESA defines critical habitat as areas on which are found those physical or biological features essential to the conservation of the species and which may require special management considerations or protection. For each essential feature we identified, we determined that it may require special management considerations or protection. One of the reasons for this finding is the lack of any existing laws, regulations, or practices that provide for the management or protection of these features for the conservation of Cook Inlet beluga whales. It is therefore foreseeable, if not likely, that through the ESA section 7 consultation process, we will offer recommendations to protect the essential features, which would otherwise remain without such protection, in order to ensure the conservation of the beluga whale. We agree that existing laws and regulations provide some benefit to these whales and to their conservation. We disagree with the statement that the endangered status of these whales is unrelated to a lack of effective management. In fact, we believe much of the decline in this DPS is attributable to unregulated subsistence harvest practices prior to regulation and management of these hunts.

Comment 29:

Those areas that do not require special management consideration or protections are not critical habitat and are not to be designated as such under the ESA. Existing state and Federal environmental management and regulatory regimes already protect habitat for beluga whales, justifying a more narrow identification of areas as critical habitat.

Response:

We disagree. The definition of critical habitat (16 U.S.C. 1532(5)(A)) requires that the physical or biological essential features may require special management considerations or protection, rather than that the area require such protections. Any area may be designated as critical habitat provided it contains one or more of these features, and provided that those features may require special management or protection.

Comment 30:

NMFS unjustifiably disregarded comments made during proposed rulemaking identifying the many existing refuges, sanctuaries, state critical habitat areas, legal protections, and mitigative requirements that provide protection to beluga whales and their habitat.

Response:

We recognize that many conservation and environmental actions occur through the efforts of the State of Alaska, local governments, and private concerns. These all contribute to a conservation ethic, undoubtedly benefit the Cook Inlet region environment, and can be beneficial to Cook Inlet beluga whales and their habitat. The ESA provides that, when considering a species for listing as a threatened or endangered species, consideration be given to efforts by any State, or any political subdivision of a state, to protect such species. Generally, a species that would otherwise qualify for listing may be excluded from listing if there are formalized conservation efforts that are sufficiently certain to be implemented and effective so as to have contributed to the elimination or adequate reduction of one or more threats to the species identified through a threats analysis conducted pursuant to section 4(a)(1) of the ESA. However, no such provision exists for the designation of critical habitat. If such provisions existed, it would still be difficult to demonstrate they were effective in providing for the conservation of the Cook Inlet beluga whales, as many of these efforts were in place during the periods in which these whales experienced significant declines, leading to the 2008 listing.

The ESA allows for critical habitat not to be designated if such designation would not benefit the species. Congress intended, however, that in most situations NMFS will designate critical habitat at the same time that a species is listed as either endangered or threatened. It is only in rare circumstances where the specification of critical habitat concurrently with the listing would not be beneficial to the species.

See

H.R. Rep. No. 95-1625 at 17 (1978), reprinted in 1978 U.S.C.C.A.N. 9453, 9467. In this instance, we have determined that the designation of critical habitat for the Cook Inlet beluga whale would be beneficial to the species by providing specific protections against Federal actions that would otherwise destroy or adversely modify that habitat. We also identify other benefits, as discussed in the following comment.

Comment 31:

Contrary to statements in the Proposed Rule, section 7 consultations are not a benefit accruing from the action, but will only add additional layers of administrative process without additional effective protections for beluga whales or their habitat.

Response:

As our analysis of economic impacts from the proposed designation indicates, many, if not most, of the future consultations on Federal actions pursuant to section 7 of the ESA would otherwise be required because of section 7's requirement that Federal agencies not take actions that jeopardize the continued existence of the species (the jeopardy standard). However, the characterization of this designation as an additional layer of process ignores the tangible benefits that will accrue from it.

The designation of critical habitat and identification of essential physical and biological features will provide procedural and substantive protections, thereby promoting the conservation of the Cook Inlet beluga whale. Procedurally, the designation of critical habitat will focus future consultations on key habitat attributes and avoid unnecessary attention to other, non-essential habitat features. Designation of critical habitat will also provide clarity to the process by alerting Federal agencies to the specific areas and features that should be considered and addressed during these consultations. The designation also educates the public as well as State and local

governments, and affords them the opportunity to participate in the designation. Substantively, the designation of critical habitat for the Cook Inlet beluga whale establishes a uniform protection plan prior to consultation. In the absence of such designation, the determination of the importance of the whale's environment would be made piecemeal.

Comment 32:

Education and outreach are not justifiable benefits accruing from the proposed designation. In fact, there is concern that this designation will result in a backlash that will undermine conservation efforts generally. NMFS should provide the references for statements regarding the benefits of critical habitat designation as described in the proposed rule, otherwise the list is speculative and should be removed from the final rule.

Response:

Education and outreach are qualitative benefits of designation. It is almost certain, however, that the process to date has greatly added to the knowledge of Cook Inlet beluga whales and their critical habitat needs within Southcentral Alaska, and probably extending to much larger geographical and societal divisions. We do not believe such education and awareness has been or will be destructive or undermine conservation efforts. Moreover, courts have recognized the education and outreach benefits accruing from the designation of critical habitat.

See, e.g.,

Conservation Council for Hawaii

v.

Babbitt,

2 F.Supp.2d 1280 (D. Haw. 1998).

Comment 33:

One commenter strongly objects to the stated benefit of reduced levels of pollution in Cook Inlet, with associated benefits accruing to a suite of ecological services, culminating in an improved quality of life (in the Cook Inlet region). This statement mischaracterizes Cook Inlet, whose waters offer pristine habitat for beluga whales.

Response:

We agree that water quality within Cook Inlet is generally high, and that approximately 98 per cent of the shoreline remains undeveloped. However, any characterization of these waters as pristine might be tempered by the facts that the largest communities in the State exist along its shore, municipal wastes and other effluents from these communities are often discharged into the receiving waters of Cook Inlet, numerous fish plants discharge processing wastes into the Inlet, minor and major fuel spills have occurred here, and offshore oil platforms regularly discharge drilling muds, cuttings, and produced waters into the Inlet. We believe it is reasonable to project improvements in pollution as a benefit of critical habitat designation even though a portion of such benefits may be realized in the future.

Comment 34:

NMFS should adopt minimum escapement goals for eulachon and salmon. A minimum density of prey is relevant to the intent of designating critical habitat.

Response:

While the importance of these prey species to Cook Inlet belugas is supported by stomach analysis of stranded and harvested whales, TEK, fatty acids, and stable isotope analysis, we do not believe sufficient information exists to determine the energetic requirements of Cook Inlet belugas or to adopt escapement levels, and any attempt to do so would be speculative. We anticipate future research will add to our knowledge of the energetic requirements of these whales and allow some insight into prey selectivity, caloric requirements, feeding behavior and speciation, and run strength within tributary waters that may support a determination of prey requirements. At this time we have no information to suggest prey availability is or has been a factor in the decline or is in need of improvement to promote the recovery of the Cook Inlet beluga whale. We hope to continue to work with the State of Alaska to ensure these whales are considered in fish management planning for Cook Inlet.

Comment 35:

NMFS should delete the term “absence of toxins and other agents” in its PCE concerning toxins, which implies that a pristine environment is essential to the conservation of these whales. NMFS should continue to rely on State and Federal water quality standards until specific agents are identified to be detrimental to beluga whales.

Response:

We qualify these terms in the definition of the PCE with the clause “of a type or amount harmful to beluga whales,” which we believe avoids creating the implication described by the commenter. The commenter correctly points out that the current exposure of these whales to various pollutants and tissue analysis have not indicated that Cook Inlet beluga whales carry significant body burdens of many common contaminants and toxins. But beluga whales are top level predators with potential to bio-accumulate toxic substances. Further, the juxtaposition of high densities of Cook Inlet belugas and Alaska's most populated and industrialized region raises a concern for the introduction of pollutants into the Inlet. We believe a PCE that addresses the essential feature of water quality is appropriate here, and the qualification we added to it will avoid unnecessary restrictions on most approved discharges. Existing water quality standards may or may not be protective of marine mammals, including small whales. Also, many pollutants with the potential to harm these animals are not currently regulated or addressed under these standards.

Comment 36:

The PCE for toxins should reflect concern for the type and amount of a constituent, rather than for a type or amount. One commenter suggests re-wording this PCE as “The absence of non-naturally-occurring toxins or other agents of a type and amount that would kill or injure Cook Inlet beluga whales or cause prolonged abandonment of their critical habitat areas,” providing the rationale that these changes would clarify that Federal agencies are not required to eliminate naturally-occurring harmful substances and replace the vague standard of harm with the effects-based language from PCE number 5 (in-water noise).

Response:

While many compounds and agents may be of a type harmful to animals, the actual threat or significance of any exposure is also dependent on their concentrations. We agree with the comment and have changed the wording of the final rule to reflect this. We disagree with the suggested changes to the remainder of this PCE because these qualities or thresholds are more appropriate in defining the condition of this PCE that equates to adverse modification of the critical habitat. That is, while the PCE is generally defined as waters free of harmful substances, adverse modification will occur when an action results in the addition of substances of a type and amount that causes mortality or other consequences impeding the conservation of the whale. Also, some substances occur naturally in the environment (

e.g.,

mercury), but are also a concern regarding anthropogenic introduction into Cook Inlet. Therefore, we chose not to exclude naturally occurring toxins or other agents, as suggested.

Comment 37:

The PCE for in-water noise should be changed to read “The absence of in-water noise that results in adverse impacts to the species survival and recovery” because many noise impacts may adversely affect the species but not result in abandonment of habitat.

Response:

The commenter's proposed language attempts to set the threshold for this essential feature or PCE at a level defining adverse modification or destruction of the critical habitat. We disagree with this approach. A PCE describes an essential feature, such as water within a certain temperature range. During a section 7 consultation,

we would consider the effects of an action with regard to this PCE and evaluate if those changes would appreciably reduce the conservation value for the species. Defining the PCE to equate to adverse modification would be circular and by-pass this analytical approach. Moreover, the definition espoused by the commenter conflates the standards for jeopardy and adverse modification, a formulation the Ninth Circuit struck down in

Gifford Pinchot Task Force

v.

U.S. Fish & Wildlife Serv.,

378 F.3d 1059 (9th Cir. 2004). We have modified the description of this PCE in the final rule to improve clarity.

Comment 38:

The PCE for in-water noise should be removed. This finding is inconsistent with that made in the final rule to designate critical habitat for the southern resident killer whale (71 FR 69054; November 29, 2006) which found that noise is an effect to the animal and not to its habitat.

Response:

In our final rule to designate critical habitat for the southern resident killer whale, we lacked sufficient information to include noise as a PCE, but noted that we would continue to consider sound in any future revisions of that critical habitat (71 FR 69054; November 29, 2006). We consider in-water noise to be both an effect on these endangered whales and a habitat attribute. It is clear that noise has the potential to alter behavior in whales in a manner that may have biological significance (

i.e.,

to result in a “take” by harassment or injury). We find that noise (or its absence) is also an important characteristic of the habitat within which these whales exist, and is appropriately identified here as an essential feature. We also agree with our previous rule for the southern resident killer whale that current scientific information is not sufficient to quantify the noise levels that may alter habitat to the extent that whales would abandon such areas. However, neither the ESA nor regulations require quantifiable thresholds to be known before any habitat attribute may be considered an essential feature. Rather, the ESA requires that we designate critical habitat based on the best scientific data available, which we have done. Indeed, the regulations (50 CFR 424.12) describe essential physical and biological features to include generically “Food, water, air, light, minerals” without further quantification.

Comment 39:

The proposed “noise” PCE does not define or explain what constitutes “abandonment of habitat” and “continuous noise.”

Response:

We use these terms with their ordinary meaning in mind and offer no specialized descriptions for these terms. Our intent is to avoid having the mere presence of noise, or even noise which might cause harassment, be deemed adverse modification. While we do not believe it is “essential” that the acoustic environment of these whales be free of noise, even noise at levels which might harass whales, we consider it essential for the whales' conservation that they are not presented with noise that may preclude their use of key habitat areas, particularly those that are important for feeding, breeding, or calving.

Continuous or non-impulsive noise is differentiated from impulsive noises, which are typically transient, brief, broadband, and consist of a rapid rise time. Impulsive noises may be a single event or repetitive. Examples of impulsive noises are explosions, sonic booms, seismic airgun arrays, and impact pile driving. Non-impulsive sources include vessels, aircraft, and vibratory pile driving.

Comments for Exclusions

We received many comments requesting exclusion from critical habitat. These requests concerned excluding navigation corridors, portions of the west and east sides of Cook Inlet, the site of the Knik Arm bridge, the POA, Port Mackenzie, commercial fishing areas, the City of Kenai, Kachemak Bay, and State legislatively-created sites (see below). We prepared an analysis to assess, among other things, the economic impacts attributable to the designation of critical habitat for the Cook Inlet beluga whale. We have determined that, based upon economic impact considerations, there are no proposed critical habitat areas or sites for which the benefits from excluding the area or site outweigh the benefits from designating that area or site. As a result, we have not proposed to exclude any sites on economic grounds. We have not provided a specific response to each individual request that was received and considered here, but we have included responses to all significant issues raised in the comments. We also considered requests for exclusion based on national security and other relevant impacts, and as discussed below, we are excluding a small area connected with the POA from the designation. In light of the impacts to national security, we determined that the benefits of excluding that small area outweigh the benefits of including it.

Comment 40:

Critical habitat should be reduced to areas where the beluga whales are most concentrated and should not include areas of historical use.

Response:

Generally, critical habitat includes those areas necessary to conserve the beluga whale, which broadly means those areas that will promote its recovery. To determine the boundaries of critical habitat, we identified the specific areas within the geographical area occupied by the whale at the time it was listed on which are found those physical or biological features essential to the conservation of the whale and which may require special management considerations or protection. This process resulted in a proposed designation and, through the notice-and-comment procedure, we refined the critical habitat designation. Our analysis indicates that the inclusion of areas only where the whales are most concentrated would be too narrow. The critical habitat designation does not include areas outside the geographical area occupied by the species as of 2008 because we do not believe that any such area is essential for the whale's conservation.

Comment 41:

The POA should be excluded from designation in recognition of it being one of nineteen National Strategic Ports whose functions include the mobilization and embarkation of military vessels for quick deployment around the world.

Response:

We have considered this request and find that, in light of the impacts to national security, the benefits of exclusion outweigh the benefits of designating the POA and a small area adjacent to it as critical habitat. The POA supports certain military functions and requirements which cannot be met elsewhere in the State. While air shipment of goods and materials present some alternatives as far as supply lines to military interests in Alaska, many other demands cannot be met without the support of large supply ships calling at this port facility. The POA also serves as the conduit for all of the jet JP-8 fuel now used at Elmendorf Air Force Base.

We believe that the POA's function in military readiness and role as a National Strategic Port could be negatively affected by designation it and surrounding waters as critical habitat. Therefore, in keeping with the provisions of the ESA, the POA and waters of Knik Arm in front of the Port (

i.e.,

the navigation channels and turning basin) are not designated as critical habitat. We have determined this exclusion will not result in the whale's extinction.

Comment 42:

Any exclusion of the POA for reasons of national security should be strictly limited to military activities, and not extend to non-military activities.

Response:

Section 4(b)(2) of the ESA provides that the Secretary of Commerce may exclude “any area” from designation as critical habitat for reasons of national security. We did not find any authority to limit these exclusions to a particular activity or entity. Also, certain non-military functions which support the operational readiness of the port, such as maintenance dredging, could impact military operations if they were delayed or otherwise impacted by designation.

Comment 43:

Port MacKenzie is significant to national security in providing the ability to efficiently transfer military units, munitions, and general cargo between land and marine modes, and should be excluded from designation.

Response:

Port MacKenzie is not currently identified as a strategic port, nor is it adjacent to military lands, accessed by a major road system, utilized for munitions transfers, or serviced by rail. We received no supporting recommendations for this exemption from the Department of Defense (DOD), and did not find reasonable evidence of the need to exclude Port MacKenzie based on national security interests.

Comment 44:

The Department of Defense (DOD) reminds us that Congress has mandated that Fort Richardson and Elmendorf Air Force Base be combined into a single facility by October 2010, and that the proposed landward boundary of critical habitat (Mean Higher High Water) would overlay the seaward military boundaries for these lands, which have been established as Mean High Water. They request clarification on this boundary issue.

Response:

Because the areas between mean higher high water (MHHW) and mean high water (MHW) are predominately unvegetated mudflats, and because all lands of Fort Richardson and Elmendorf AFB (now combined, Joint Base Elmendorf-Richardson) are administered under an Integrated Natural Resources Management Plan (INRMP) which we found to provide benefit to Cook Inlet beluga whales, these areas are ineligible for designation as critical habitat. Modifications have been made within the final rule to reflect this change.

Comment 45:

The commercial and subsistence fisheries for the Native Village of Tyonek (NVT) should be excluded from critical habitat designation.

Response:

We believe the commenter is requesting exclusion of those waters which support commercial and subsistence fisheries in and surrounding the Chuitna River, near the NVT under section 4(b)(2) of the ESA. We have considered economic impacts, impacts to national security, and other relevant impacts, including impacts to tribal interests. We conclude that the benefits of excluding any particular area do not outweigh the benefits of specifying such area as critical habitat, except for a small area associated with the POA which we excluded in light of impacts to national security. We emphasize that where no Federal authorization, permit, or funding is required (

i.e.,

no Federal action exists), the activity is not subject to section 7 of the ESA. Therefore, there would be no section 7 consultations costs associated with that activity. Further, we do not believe impacts to tribal interests indicate that the benefits of excluding the areas that cover the NVT subsistence and commercial fisheries outweigh the benefits of specifying these areas as critical habitat. We have not received comments that indicate tribal interests would be harmed by this action.

Comment 46:

The State of Alaska requests exclusion under section 4(b)(2) of the ESA for all legislatively-designated areas, such as refuges, sanctuaries, and critical habitat areas.

Response:

We have considered this request. The Secretary of Commerce may use his discretion to exclude areas from critical habitat if the Secretary determines the benefits of such exclusion outweigh the benefits of designation of the area, provided the exclusion would not result in the extinction of the species. The areas in question include the Goose Bay and Anchorage Coastal Refuges, and the Redoubt Bay, Kalgin Island, and Kachemak Bay State Critical Habitat Areas. As stated in an earlier response to comment, we recognize the contribution of such sites to the conservation of the Cook Inlet region, and the direct and indirect benefits they provide to Cook Inlet beluga whales and their habitat. In this case, the State is arguing the benefits we place on including in the designation these legislatively-designated areas be reduced by their existing benefit/value owing to their function in conserving these whales. All of these areas include important ecological and environmental attributes, especially for fish and wildlife. Also, several of these sites include important beluga whale habitats and may have large numbers of beluga whales within their boundaries at various times of the year. Despite the ecological values of these areas and the presence of beluga whales and their habitat, we know of no such State area whose purpose specifically includes the conservation of beluga whales or their habitat. Moreover, neither the Cook Inlet beluga whale nor its habitat is included on the State of Alaska's endangered species list. We believe that the benefits from designation, described in this final rule, will accrue to the conservation of the Cook Inlet beluga whale, even in those areas currently protected for other purposes by the State of Alaska, such as refuges and sanctuaries.

We also considered the economic impacts associated with the designation as critical habitat of the State legislatively-designated areas. Our economic analysis indicates that the majority of those impacts are associated with the requirement to consult on Federal actions under section 7 of the ESA. Often times, however, such costs are minimal, because the consultation would already be required because the proposed Federal action has the potential to affect beluga whales. Any Federal action that “may affect” an endangered or threatened species requires consultation, regardless of the existence of critical habitat. Because land use and management plans exist for these sites, and many of these areas are remote, there are fewer Federal actions occurring or proposed here than may be expected outside of these refuges, sanctuaries, and critical habitat areas. We, therefore, do not expect the demand for Federal actions in these sites to increase markedly in the future. Additionally, any costs that may be attributable to critical habitat designation would be unlikely to be borne by the State of Alaska, but rather by the Federal action agency or any private entity proposing work here that requires Federal authorization, permits, or funding. Also, any “costs” such as increased consultation on actions that may impair the function of habitat (critical habitat for beluga whales) in these areas may be viewed as a benefit, rather than a cost, in that it may add to the values for which these areas were established.

Therefore, after considering the economic impacts and other relevant impacts described above, we have determined that the benefits of designation of critical habitat outweigh the benefits of excluding those areas currently designated by the State of Alaska as refuges, sanctuaries, and critical habitat areas from this designation.

Comment 47:

NMFS can exclude areas to preserve partnerships and existing protections if the designation risks losing important protection for beluga whales.

Response:

The ESA requires that the designation process take into consideration the economic impact “and

any other relevant impact” of specifying an area as critical habitat, but neither the ESA nor the implementing regulations provide clarity on the provisions for the Secretary of Commerce to exclude from designation any areas for which the benefits of exclusion outweigh the benefits from designation. We are not entirely clear as to what is meant by the comment's reference to critical habitat designation posing risks to existing protective measures. Nonetheless, we believe that the designation will result in an increase in protection or conservation measures.

Comment 48:

Electric energy for the Anchorage area is supplied by undersea cables from a generating plant near Beluga, Alaska. The cable field and overlying waters should be excluded from critical habitat as any delays in maintenance or repairs would present significant economic costs and threat to the reliability of the region's electrical system. The possible requirement to stop water operations if a whale is sighted closer than 2,000 feet would have very negative impacts on cable laying. Similarly, barge operations in support of power generation could be negatively impacted by this designation, and these barge landing areas should also be excluded.

Response:

After preparing an economic impact analysis and considering those economic impacts and the ones raised in public comments on the proposed rule, we have determined that the benefits of exclusion do not outweigh the benefits of including any particular area. The economic analysis assesses power generation projects and general commercial activities in the upper Inlet. Thus, we believe the findings in the economic analysis are applicable to this comment. Whenever practicable, the analysis sought to identify the incremental costs unique to critical habitat designation. The analysis found that the impacts from a designation decision will often be co-extensive with the ones from the listing decision. That is, in many instances, costs arising from the need to consult because of the potential to destroy or adversely modify critical habitat will be co-extensive with the costs arising from the need to consult because of the potential to jeopardize the species.

In the specific example the commenter provides (stopping operations when a whale was near the work boat), consultation costs would be entirely attributable to ESA jeopardy considerations stemming from the listing, not critical habitat designation, because the hypothetical scenario involves the direct interaction between a whale and the work activity referenced (

i.e.,

a potential “take”). This interaction is, in no way, influenced by the designation of critical habitat. In other instances, for example, actively laying submarine cable in Cook Inlet, the incremental cost of evaluating the potential of a proposed action to “destroy or adversely modify” critical habitat during a consultation would be largely indistinguishable from the costs attributable to evaluating that activity's potential to jeopardize the species.

Moreover, the commenter provided no specific information indicating that this work would even require Federal authorization, permits, or funding (

i.e.,

Federal action). Absent a Federal action, the critical habitat designation would not impose section 7 consultation obligations on the commenter's hypothetical activity. We are aware of no Federal permit requirements to maintain or repair submarine cable, or to operate a barge. Based upon the information provided, we did not find a compelling reason to exclude these areas from critical habitat.

Comment 49:

NMFS has not presented sufficient information to justify the inclusion of the lower Inlet areas as critical habitat. Hobbs

et al.

(2005) is cited as describing dive behavior in winter, yet no such data are reported in that paper. Winter behavior and habitat use may differ from that of summer months, and NMFS habitat models are primarily based on observations during June.

Response:

The Proposed Rule incorrectly referenced Hobbs

et al.

in describing dive behavior; that paper did not include analysis of dive patterns. That work did, however, establish the distribution of tagged beluga whales during winter months as including offshore waters of the mid Inlet which are consistently deeper than those areas typically occupied by whales during the summer. At this time, we do not have a complete understanding of the specific attributes that support winter beluga habitat within Cook Inlet. Because we are required to consider the best scientific data available in designating critical habitat, we reviewed non-systematic sighting reports from State and private sources, aerial surveys of winter beluga distribution, and TEK in assessing the value of the lower Inlet as critical habitat. Also, we believe the use of the southwest Inlet during late summer and fall may be an extension of the feeding behavior (and distribution) which occurs in the upper Inlet as whales move south to take advantage of late spawning returns of coho salmon. This habitat use and behavior would support the use of the results in Goetz

et al.

(2007) as descriptive of habitat values in the southwest Inlet. While there is some evidence that beluga whales may be overwintering in an offshore area south of Kalgin Island, these areas were not included as critical habitat because we felt information was not adequate to describe this use or identify any essential features.

Comments for Inclusion

We received many comments recommending additional areas be included in the critical habitat designation. These include all of Cook Inlet, corridors connecting habitat areas, upper and lower Cook Inlet, historically-used areas, Iniskin Bay, the mouths of tributary streams entering the Inlet, the Eagle River Flats firing range, the POA, and Hudson Bay near Churchill, Canada. We have considered all such comments and respond below to the significant issues they raise.

Comment 50:

The critical habitat should include important feeding areas at the mouths of the Matanuska River, Knik River, and Cottonwood Creek.

Response:

The described boundaries for this critical habitat generally include areas such as these. While there is often a poorly-defined division between Cook Inlet and a tributary stream or river, our proposed river boundaries would extend critical habitat into the lower reaches of many streams. Tidal influence may extend a considerable distance up these tributary waters, but represents areas in which we have very few observations or reports of belugas. We identified several waters where beluga whales are known or suspected to utilize such up-river areas for feeding, and specifically extend critical habitat into these reaches.

Comment 51:

Critical habitat must include the habitat of prey species of beluga whales, such as the Susitna River system and other waters above tidal influence.

Response:

The ESA requires that critical habitat be located within the geographic area occupied by a species, or within specific areas outside of occupied habitat determined to be essential to the conservation of the species. The areas described are outside the geographic areas occupied by the species at the time of its listing, and in light of the areas we are designating and the best scientific data available, we have determined that the unoccupied areas are not essential to the whale's conservation. We agree that habitat for prey species such as salmon and eulachon is a necessary component to their existence in the wild, but we do not have adequate scientific information

to identify specific areas that would be essential to the conservation of these beluga whales with respect to habitat values of prey species.

Comment 52:

Critical habitat boundaries should be extended to incorporate all of the described range of these whales. Both the nearshore and offshore areas of lower Cook Inlet should be designated as critical habitat.

Response:

We carefully considered designation of these areas as critical habitat, but we did not find sufficient justification to do so. These areas have been used by beluga whales in the past, during periods in which their abundance was much higher than today, and beluga whales are still observed in these areas. However, both the current and historical accounts of beluga whales in these areas do not indicate they supported important numbers/concentrations of whales, or that they served important habitat functions. Existing habitat models describe open water values that are likely very important attributes to feeding and, perhaps, calving habitat needs and preference. Such modeling does not indicate high habitat values are present in the areas in the lower Inlet that are not included in the designation. We acknowledge more information is needed to understand the winter habitat needs of the Cook Inlet belugas, and that other areas may be found to be important as new data arrive. But presently, we do not find sufficient support for inclusion of these areas.

Comments To Extend Public Comment

Comment 53:

NMFS received several comments and requests to extend or re-open the comment period for this action, or to conduct additional hearings in the State.

Response:

On consideration, we believe the public process, which has included the publication of an Advance Notice of Proposed Rulemaking with a 30-day public comment period (74 FR 17131; April 14, 2009), publication of a proposed rule with 60-day public comment period (74 FR 63080; December 2, 2009), a 30-day extension of the comment period for the proposed rule, and four public hearings held in the major population centers in the Cook Inlet region (Kenai, Soldotna, Wasilla, and Anchorage), was sufficient and proper. Therefore, we have determined not to extend or re-open the comment period, or to hold additional hearings for this final rulemaking.

Comments on the Need To Designate Critical Habitat

Comment 54:

Designation of critical habitat was unnecessary, and will not add any meaningful protection to these whales. The regulations at 50 CFR 424.12 provide that critical habitat may not be prudent, and therefore would not be designated, when that designation would not be beneficial to the species. The consultation provisions of the ESA provide reasonable protection to these whales under the jeopardy standard. NMFS has used circular logic in saying the benefit of designating critical habitat is that it will require (Federal agencies) to ensure their actions do not destroy or adversely modify critical habitat. The remaining functional benefit of public education and outreach would be more effectively met through a dedicated public education program rather than the less direct means of designating critical habitat.

Response:

We disagree. The ESA provides that critical habitat shall be designated “to the maximum extent prudent and determinable.” 16 U.S.C. 1533(a)(3)(A). The ESA does not define “prudent.” NMFS/USFWS regulations, however, provide that a designation of critical habitat is not prudent when the “designation of critical habitat would not be beneficial to the species.” 50 CFR 424.12(a)(1)(ii). This means that in the rare situation where there is zero benefit from designation, we need not designate. If there is any benefit, we must designate. Congress intended that in most situations the Secretary will designate critical habitat at the same time that a species is listed as either endangered or threatened. It is only in rare circumstances where the specification of critical habitat concurrently with the listing would not be beneficial to the species.

See

H.R.Rep. No. 95-1625 at 17 (1978), reprinted in 1978 U.S.C.C.A.N. 9453, 9467.

See also Enos

v.

Marsh,

769 F.2d 1363, 1371 (9th Cir.1985) (holding that the Secretary “may only fail to designate a critical habitat under rare circumstances”);

Northern Spotted Owl

v.

Lujan,

758 F.Supp. 621, 626 (W.D.Wash.1991) (“This legislative history leaves little room for doubt regarding the intent of Congress: The designation of critical habitat is to coincide with the final listing decision absent extraordinary circumstances.”).

In short, if there will be any benefit from the designation, we must designate. Even if many consultations will occur because of the combined potentialities that proposed Federal actions will adversely modify critical habitat and jeopardize the species, if some will occur only because of the potential for adverse modification, there still is benefit to the species (see response to comment 54). Further, courts have recognized benefits beyond the need to consult.

See Conservation Council for Haw.

v.

Babbitt,

2 F.Supp.2d 1280, 1288 (D. Haw. 1998) (substantively, the designation establishes a uniform protection plan prior to consultation, and procedurally, the designation educates the public as well as state and local governments, and affords them the opportunity to participate in the designation). We do not believe this situation is the rare one allowing us to avoid the ESA's strong mandate to designate critical habitat.

As for the arguments that the Marine Mammal Protection Act (MMPA) protection is enough, critical habitat must be designated regardless of whether other laws or provisions arguably provide adequate protection.

See Natural Resources Defense Council

v.

U.S. Dep't of the Interior,

113 F.3d 1121, 1127 (9th Cir. 1991) (“Neither the Act nor the implementing regulations sanctions nondesignation of habitat when designation would be merely

less

beneficial to the species than another type of protection”). Lastly, while the term “take” includes harm, and USFWS' definition of harm includes habitat modification, it applies only when such modification “actually kills or injures” the species (50 CFR 17.3). Under section 7 of the ESA, we may find that an action will adversely modify critical habitat and propose reasonable and prudent alternatives without having to also make the higher evidentiary determination that the adverse modification will kill or directly injure the species.

Legal and Regulatory Comments

Comment 55:

Existing State and Federal regulation and associated mitigation measures are adequate to protect Cook Inlet beluga whales and the critical habitat designation is not necessary. One commenter also asserts that NMFS has disregarded the information it submitted concerning existing laws and regulations that protect Cook Inlet beluga whales and their habitat. One commenter also asserts that there is no evidence that a lack of effectiveness of any of the management regimes in place in Cook Inlet or that any management or regulatory gap contributed to the endangered listing of Cook Inlet beluga whales or limits its recovery.

Response:

The ESA defines critical habitat, in part, as “the specific areas * * * on which are found those physical or biological features (I) essential to the conservation of the species and (II) which may require special management considerations or protection.” 16 U.S.C. 1532(5)(A)(i). The phrase “may require” indicates that critical habitat includes features that

may now, or at some point in the future, be in need of special management considerations or protection.

As explained in the proposed rule, we determined that each PCE may require special management considerations or protection. The commenter is correct that certain laws and regulatory regimes already protect, to different degrees and for various purposes, the waters of Cook Inlet and, therefore, to a certain extent, the physical or biological features identified as essential to the conservation of the species. The fact that there are relevant state and Federal regulations which aim to protect these waters and features from a variety of sources and actions indicates that each feature currently is in need of special management considerations or protection. The existing laws and regulations do not, however, ensure that current and proposed actions will not adversely modify or destroy beluga whale critical habitat in Cook Inlet. It is therefore probable, if not likely, that the PCEs essential to the conservation of the Cook Inlet beluga whale will require special management considerations or protection in the future. The consultation process is one mechanism through which we can ensure that those features are afforded such consideration or protection.

With regard to the comment that we disregarded information submitted on existing laws and regulations, we disagree with the commenter because we have considered this information in the proposed rule and in this final rule. Finally, with regard to the comment about whether the lack of effectiveness of any of the current management regimes contributed to the endangered listing, the designation of critical habitat for any listed species does not necessarily indicate that existing laws are responsible for the species' decline. Similarly, the fact that there are existing laws that protect different aspects of a listed species' critical habitat does not, per se, preclude the designation of critical habitat. The inquiry is whether there are physical or biological features that are essential to the conservation of the species and which may require special management considerations or protection. Congress envisioned that, except in extraordinary circumstances, the Secretary would designate critical habitat. There are no extraordinary circumstances that would allow us to avoid the designation of critical habitat for the Cook Inlet beluga whale.

Comment 56:

The critical habitat designation should not be finalized until pending legal rulings on the status of the Cook Inlet beluga whales are made.

Response:

We disagree. The ESA requires us to designate critical habitat concurrently with the listing decision to the maximum extent prudent and determinable (16 U.S.C. 1533(a)(3)(A)(i)). If such designation is not determinable, we may extend the deadline by one year. In the extraordinary situation where the designation of critical habitat is not prudent, we may decide not to do so. See response to comment 54 above. Section 424.12(a)(1) of 50 CFR presents two circumstances when a designation is not prudent, but neither one is applicable here. Accordingly, whichever “pending legal rulings on the status of Cook Inlet beluga whales” the commenter is referring to, they do not constitute cognizable grounds under the ESA for delaying the designation of critical habitat. If the State of Alaska prevails in its lawsuit challenging our decision to list the Cook Inlet beluga whale, we will determine at that time what effect such a ruling has on this final rule.

Comment 57:

Because NMFS has not yet complied with all of the applicable directives, such as the National Environmental Policy Act, Executive Order 13211, and Public Law 108-199, the proposed rule is unlawful.

Response:

We disagree. We have complied with Executive Orders 13211 and 13175, as modified by Public Law 108-199 (74 FR 63,080, 63,093-94; Dec. 2, 2009). NEPA does not apply to decisions to designate critical habitat.

See Douglas County

v.

Babbitt,

48 F.3d 1495, 1501-08 (9th Cir. 1995).

Comment 58:

NMFS must provide justification for the designation of critical habitat inconsistent with comments provided to it by the State of Alaska and its political sub-divisions.

Response:

Section 4(i) of the ESA provides that if the Secretary issues a final regulation which is in conflict with the comments of a State agency, the Secretary must provide a written justification for his failure to adopt regulations consistent with the agency's comments. We have complied with this section by submitting a letter to the Alaska Department of Fish & Game and the Governor's Office.

Comment 59:

There is a direct Federal nexus with the critical habitat designation through the Magnuson-Stevens Act to anadromous species. These anadromous species include hooligan, smelt, and salmon.

Response:

We are uncertain as to what this commenter means by “direct Federal nexus with the critical habitat designation.” To the extent that this commenter is referring to potential ESA section 7 consultations, we note that section 7 of the ESA requires each Federal agency, in consultation with NMFS, to ensure that “any action authorized, funded, or carried out” by the agency is not likely to jeopardize the continued existence of any listed species or result in the destruction or adverse modification of the species' habitat (16 U.S.C. 1536(a)(2)). Our regulations provide that action “means all activities or programs of any kind authorized, funded, or carried out, in whole or in part, by Federal agencies in the United States or upon the high seas” (50 CFR 402.02). Accordingly, if or when there is a Federal action that may affect a listed species or its habitat, the Federal action agency must consult with NMFS. At this time, we are unaware of any proposed Federal actions pertaining generally to hooligan, smelt, or salmon that would require consultation.

Economic Comment

Comment 60:

Many comments suggest that the Draft RIR/4(b)(2)PA/IRFA did not consider changes to development projects stemming from the critical habitat designation, such as added costs and operational and permitting delays to projects resulting from the ESA section 7 consultation process, and the attendant economic consequences. Some comments, such as those by Chugach Electric Association and ConocoPhillips, also estimated the costs associated with these modifications and delays. According to these comments, in addition to the ESA process, project delays could also be caused by environmental lawsuits, once the critical habitat is designated.

Response:

The Cook Inlet beluga whale was listed as endangered in October 2008. Since the listing, all Federal agencies have had the obligation to consult with NMFS to ensure that any action authorized, funded, or carried out by them (

i.e.,

Federal action) is not likely to jeopardize the continued existence of the species. Consultations in accordance with this obligation must be conducted in the future, regardless of whether critical habitat is designated. The statute contains timelines for section 7 consultations, and Federal agencies should plan their activities accordingly to avoid delay. Non-Federal entities that require Federal permits for development projects should also be aware of the consultation requirement, and factor the time needed for consultations into their plans and schedules. As consultations are already required under the jeopardy standard, the additional consultation standard of destruction or adverse modification of critical habitat is not anticipated to result in significant, additional project

delays. With respect to project modifications, there presently is no detailed empirical information (

e.g.,

engineering, materials, and structural design; project scheduling, temporal sequencing of construction, and duration; associated costs and financing) pertaining to future projects or any project modifications that might be proposed for areas within or immediately adjacent to Cook Inlet beluga whale critical habitat, making quantitative estimation of directly attributable economic costs purely speculative. In other words, since the precise nature of any future project modification is unknown, we cannot speculate whether such a potential modification ultimately increases or decreases project costs and by how much. Qualitatively, based on past experience and the best scientific and commercial data available, we do not expect project modifications to add significant monetary costs, especially since most of these modifications would likely be required pursuant to consultations arising under the jeopardy standard.

Finally, whether any project is delayed because of a lawsuit will depend on whether a court determines that NMFS has violated Federal law and injunctive relief is appropriate. Costs associated with project delays due to such lawsuits are extremely speculative.

Comment 61:

A comment by ConocoPhillips asserts that a critical habitat designation will result in increased administrative costs to the company, and has the potential to result in operational and permitting delays and/or lead to other new costs. The independent economic analysis conducted by the company conservatively estimates the impacts to ConocoPhillips alone in the range of $698,000 to $796,000 over 20 years. According to the company, these costs could rapidly escalate, if NMFS imposed even minor restrictions on ConocoPhillips' operations in connection with the critical habitat designation.

Response:

See response to comment 60.

Comment 62:

Some comments request the exclusion of the POA and Port Mackenzie from the final critical habitat designation, based on national security, as well as economic reasons.

Response:

After considering impacts to national security and weighing the benefits of exclusion with those of specifying as critical habitat the POA and a small, adjacent area extending to the turning basin, we have determined to exclude those areas from the critical habitat designation. The exclusion does not, however, include Port Mackenzie. We have determined that its inclusion as critical habitat does not implicate significant impacts to national security, supported by the fact that DOD has not asserted that there would be any. After considering the economic impacts of the designation, we determined that the benefits of excluding Port Mackenzie do not outweigh the benefits of specifying the area as critical habitat. The decision to exclude the POA is based principally on impacts to national security, which have been described in this rule and were identified in comments responding directly to our public notice requesting information on this issue. See detailed discussion below.

Comment 63:

A number of comments assert that, contrary to some perspectives in Alaska, the critical habitat designation will not hamper responsible development. Based on tens of thousands of reviews across the nation on development projects in areas containing endangered species, less than one percent of projects are significantly curtailed, because responsible development and endangered species protection can and do go hand in hand. The vast majority of projects entering the consultation process are resolved informally with a determination that no listed species will be impacted, nor designated critical habitat destroyed or adversely modified. Even where a formal consultation is required in instances of an identified potential threat, the agencies more often than not conclude that no such threat exists, or work with the action agency to design project alternatives. Only in extremely rare instances are projects terminated because of probable impacts on listed species.

The comments further state that critical habitat designation does not affect private activities that do not require Federal permits. Nor is it undertaken in a vacuum: Federal agencies are already required to consult under section 7 of the ESA if their action could jeopardize the continued existence of an endangered or threatened species. Critical habitat designation simply adds another question for the agency to consider as part of the consultation: Whether the Federal agency action could result in the destruction or adverse modification of critical habitat. Any incremental cost of critical habitat designation is, therefore, small and limited.

Response:

We agree with the commenters. The economic analysis conducted in support of the Final RIR/4(b)(2)PA/FRFA is based on the same premise as that outlined in these comments.

Comment 64:

A number of comments demand a more robust economic analysis before the critical habitat designation is finalized. Further, these comments expressed concern with the methodology used to estimate the cost of the proposed designation. According to these comments, the current analysis is inadequate and a more comprehensive economic analysis needs to be conducted.

Response:

The economic analysis conducted in support of the Final RIR/4(b)(2)PA/FRFA employed the appropriate methods and used the best scientific data available to consider all relevant economic impacts and develop cost and benefit estimates. As required under the ESA, Regulatory Flexibility Act, Executive Order 12866, and other applicable law, the analysis considered all costs and all benefits relevant to assessing the net welfare changes attributable to the final action. These changes were monetized to the fullest extent useful estimates could be made or treated qualitatively when monetization was not practicable. These component welfare effects were then integrated in order to reach conclusions about the expected “net benefit to the Nation” attributable to the final critical habitat designation. While the commenters demand a more robust economic analysis, they do not provide any new or additional data. A few comments mention certain “costs” that are asserted to be incremental to the critical habitat designation. However, many of the values identified within these comments are not “economic costs,” but instead, “impact” measures (

e.g.,

input-output multipliers) that reflect, for example, localized commercial activity. As such, they do not represent economic benefits or economic costs, as these concepts are employed in traditional “benefit/cost” analysis. Commercial activity impacts, while important distributional indicators, are “transfers” within a National Accounting analytical framework mandated under applicable Federal law. Distributional impacts are treated separately from economic costs and benefits in the analytical documents. Those economic costs that are correctly identified in these comments would, based upon NMFS' economic analysis, likely be incurred regardless of whether critical habitat is designated (also see response to earlier comments). Furthermore, there are fundamental and important distinctions between economic “benefits and costs” and economic “impacts.” The former are crucial in evaluating “net welfare” changes; that is, do the benefits exceed

the costs, resulting in a net gain to society. Impact measures (

e.g.,

income and employment multipliers) reflect relative economic “activity” in a specified locale, relative to a baseline condition.

The commenters have confused these crucial economic concepts. With, for example, specific reference to comments on the FRFA, the purported “costs” identified there are not relevant to the traditional cost-benefit analysis. And, with respect to the ESA, we considered the economic impacts cited in these comments, but do not believe that they change the conclusion that the benefits of exclusion (principally monetary) do not outweigh the benefits (economic, ecological, educational, biological) of specifying the areas as critical habitat.

Comment 65:

A few comments point out that the proposed critical habitat area overlaps geographically with Alaska's highest human population density and its primary economic base. Yet, the economic analysis conducted in support of the Draft RIR/4(b)(2)PA/IRFA cites the added costs for evaluating future projects in the proposed critical habitat at a mere $187,000 to $571,000.

Response:

Some commenters have expressed concern about the designation of critical habitat in areas of high population density and human activities. The concerns are related to the perceived potential economic costs that may be imposed by critical habitat designation. The Final RIR/4(b)(2)PA/FRFA concludes that the economic cost of critical habitat designation that can be reasonably “monetized,” at present, is estimated to have a discounted net present value of approximately $187,000 to $571,000, assuming a 3 percent real discount rate and 10-year planning horizon; and about $157,000 to $472,000, using a 7 percent real discount rate and 10-year period. “Applicants” associated with section 7 consultations on the various activities that could be potentially impacted are only expected to bear $900 to $3,500 per consultation in administrative costs related to the incremental costs of critical habitat designation for formal consultations, while they are not responsible for any incremental costs related to informal consultation. It is important to recall that section 7(a)(2) of the ESA applies only to Federal actions (

i.e.,

actions authorized, funded, or carried out by a Federal agency). Absent such Federal action, activities undertaken in or adjacent to Cook Inlet are not subject to the provisions of section 7 consultation on critical habitat and will incur no attributable or quantifiable costs or other encumbrances due to the designation of critical habitat. Even for proposed Federal actions, “applicants” associated with consultations on activities such as oil and gas exploration and development, power projects, mining, water quality, port expansion and development, transportation and other infrastructure projects are not expected to bear any significant costs uniquely attributable (

i.e.,

incremental) to the designation of critical habitat for the Cook Inlet beluga whale. Every Federal agency must consult under section 7 of the ESA to ensure that its action will not jeopardize the continued existence of the whale. Formal consultation is required if the proposed action “may affect” the whale (50 CFR 402.14(a)). Whether the consultation may proceed informally, as opposed to formal consultation, will depend on whether the action is likely to adversely affect the species (50 CFR 402.14(b)).

Comment 66:

Some commenters point out that the period employed for the analysis, 2009 to 2018, may be insufficient, particularly when dealing with significant resource and community infrastructure operations and development. Firms in these industrial sectors must balance disparate time horizons for capital life, field life, field extension, and field depletion rates that are rarely as short as 10 years.

Response:

As mentioned in Section 3.4 of the Final RIR/4(b)(2)PA/FRFA, an interval of 10 years is widely employed in the policy analysis arena. This time-frame allows sufficient scope over which longer-cycle trends may be observed (

e.g.,

progress towards population recovery for the Cook Inlet beluga whale), yet is short enough to allow “reasonable” projections of changes in use patterns in an area, as well as shifts in exogenous factors (

e.g.,

world supply and demand for petroleum, U.S. inflation rate trends) that may be influential.

Comment 67:

An independent study commissioned by the Resource Development Council (RDC) asserts that the Cook Inlet beluga whale critical habitat designation has the potential to result in economic impacts on RDC's members ranging from $39.9 million and $399 million, annually. Over a 10-year period (the length of time utilized by the Draft RIR/4(b)(2)PA/IRFA) the present value of that lost production at a three percent discount rate is claimed to be $340.3 million to $3.4 billion, and at a seven percent discount rate is $280.2 million to $2.8 billion. These numbers are asserted to be conservative and do not take into account, for example, the $400 million-$600 million that the Anchorage Water and Wastewater Utility (AWWU) may be required to spend to upgrade its facilities. According to RDC, even the most conservative estimate of $280.2 million over 10 years, representing an impact of only a one percent reduction in Cook Inlet region output, is sufficiently significant to warrant broad exclusions.

Response:

The independent study commissioned by RDC considers potential “impacts” of the proposed critical habitat designation to five key industries: oil and gas, mining, POA, commercial fishing, and sport fishing. Further, qualitative discussions of impacts on other projects/sectors/entities are also provided, though not quantified. These include tourism, Knik Arm Bridge and Toll Authority, community development projects, Anchorage Water and Wastewater Authority (AWWU) discharges, Port McKenzie, vessel traffic, and energy infrastructure.

We reviewed and considered this report. While the RDC's Economic Analysis states that it “monetizes, quantifies, or qualitatively assesses the incremental costs and benefits to entities directly attributable to the CHD,” it is unclear if the analysis excludes the conservation measures already underway or which may be taken due to the listing of the Cook Inlet beluga whale. Economic impacts from these measures are not attributable to the designation of critical habitat. Further, given the time periods when most of the six studies relied upon in the RDC Economic Analysis for identifying the range of reductions were conducted, the impacts identified are likely co-extensive, not incremental. Therefore, the RDC Economic Analysis appears to significantly over-estimate the economic costs that are attributable to the designation of critical habitat.

In terms of specific study outcomes, the impacts to mining in the RDC Economic Analysis are based on the premise that both the Chuitna Coal Project and the Pebble Project will likely be completed. While this may be true for the Chuitna Coal Project, the Pebble Mine project is in the planning/pre-permitting/pre-development stage, and does not have an approved project description. At this time, there is reasonable uncertainty regarding the likelihood of this project (Pebble Project) occurring at all, let alone within the next 10 years. Also, many AWWU facilities may be required to upgrade for Clean Water Act (CWA) compliance, regardless of the designation of critical habitat for the Cook Inlet beluga whale. These costs, if incurred, are not

attributable to the critical habitat designation.

As noted in response to a previous comment, the misunderstanding and resulting confounding of fundamental concepts of “economic costs and benefits” with “measures of economic activity” (

e.g.,

employment multipliers) has led the commenters to derive vastly inflated projections of the attributable “economic costs” of critical habitat designation. Input/output multipliers do not reflect, and are not equivalent to, economic costs or economic benefits. They are correctly interpreted as location-specific “activity measures” reflecting the rate of turnover and the path of exchange, for example, of a dollar created within the identified economic unit (

e.g.,

county, region, state), before it leaks out into the wider economy. Emphasizing that such relative economic activity impacts are not relevant to the assessment of “net benefits to the Nation,” we did describe and evaluate the temporal and geographical impacts that may accrue to localized economic activity, to the extent practicable.

Comment 68:

One commenter has provided suggestions to improve the presentation of results in the Draft RIR/4(b)(2)PA/IRFA as follows:

Regarding the analysis of costs, the overriding conclusion from the [economic] analysis is that impacts on the private sector will be minimal. This point should be highlighted and the public sector costs should be clarified. In particular, Table 7.1 outlining the total costs (all based on “consultation” costs) is misleading. The numbers indicated are for a 10-year period total and that should be represented in the table itself.

Footnote 374 is crucial to the analysis and yet unfortunately is buried. It should be part of the main text. The only discount rate is 3 percent as the “social discount rate,” because this is a public/social policy choice. This is accepted practice in the economics profession. If total costs are averaged over the 10-year period, they only come out to between $18,700 to $57,000 per year.

In Section 7 of the Draft RIR/4(b)(2)PA/IRFA, there is no statement of the methods used to calculate costs. Once more, these are national averages only.

Response:

We appreciate the suggested improvements, and considered them when we completed the Final RIR/4(b)(2)PA/FRFA.

Comment 69:

A handful of comments assert that lost development opportunities resulting from the critical habitat designation will result in declines in both State and local tax revenue, and reduce the number of jobs. An example cited is that of Alaska's already struggling oil and gas operations, where hundreds of oil field workers and professionals have been laid off in recent months. The comment asserts that critical habitat designation will have a further crippling effect on such industries.

Response:

As stated in more detail in response to an earlier comment and in the Final RIR/4(b)(2)PA/FRFA, the designation of critical habitat is not anticipated to hamper development in the vicinity of Cook Inlet, and thus would not result in declines in State and local tax revenues nor lost jobs. The additional costs incurred by industry that can be reasonably monetized at present and are uniquely attributable to the critical habitat designation, would be the negligible third party costs of section 7 consultations (

i.e.,

$900 to $3,500 per consultation in administrative costs related to the incremental costs of critical habitat designation for formal consultations; no costs to industry are incurred for informal consultations). The project modifications and associated costs that may be requested, expressly due to consultation over potential destruction or adverse modification of critical habitat, are anticipated to be minimal and rare, given that most of any such modifications would already be required under ESA section 7's jeopardy standard. Moreover, the nature of any such modification is speculative and, as a result, whether the modification ultimately increases or decreases project costs (and, by how much) cannot be determined at this time.

Comment 70:

Comments by the Chugach Electric Association, Inc. and the Resource Development Council of Alaska, Inc. point out that the Draft RIR/4(b)(2)PA/IRFA does not mention the existing high voltage submarine cable fields that cross Knik Arm, connecting the Anchorage area, as well as the Kenai Peninsula, to Chugach's existing generation plant near the Beluga gas fields. These cables must be maintained and occasionally replaced. Chugach spelled out for NMFS the potential economic impact of any delays in maintaining and repairing those cables, explaining that these delay-related costs are in addition to any administrative costs associated with ESA consultation, and any increased costs incurred by Chugach in altering its projects to benefit the whales.

Response:

As discussed in more detail in response to previous comments regarding exclusion of cable fields and overlaying waters from the critical habitat designation, we are not aware of any Federal actions in connection with the maintenance or repair of submarine cables, and the commenters have not indicated the existence of such Federal action. Therefore, absent Federal action, the proposed critical habitat designation would impose no compliance requirements (

e.g.,

no delays, direct or indirect costs) on maintaining, repairing, or occasionally replacing submarine cables in Cook Inlet.

Comment 71:

One comment states that while the Draft RIR/4(b)(2)PA/IRFA analyzed cost impacts of critical habitat designation for two other tidal energy projects, it should be revised to include the potential costs of critical habitat designation to the Turnagain Arm Tidal Energy Generation project, as well. The Turnagain Arm Tidal Energy Corporation filed an application with the Federal Energy Regulatory Commission (FERC) on November 17, 2009, for a preliminary permit to study the feasibility of a tidal energy generation system on the Turnagain Arm of Cook Inlet.

Response:

The Final RIR/4(b)(2)PA/FRFA analyzed economic impacts of critical habitat designation on projects that are reasonably likely to occur during the 10-year period of analysis. In November 2009, the Turnagain Arm Tidal Energy Corporation filed for a preliminary permit pursuant to section 4(f) of the Federal Power Act, proposing to study the feasibility of the Turnagain Arm Tidal Energy Generation project. According to the December 4, 2009,

Federal Register

document, “the sole purpose of a preliminary permit, if issued, is to grant the permit holder priority to file a license application during the permit term. A preliminary permit does not authorize the permit holder to perform any land disturbing activities or otherwise enter upon lands or water owned by others without the owners' express permission.” Therefore, while it appears from the proposed project description that the project, if approved, may affect the whale's critical habitat, the project is still sufficiently ill-defined, presumably undergoing design and feasibility assessments, that further progress towards development and submission of the next series of applications remain in pre-permitting stages. Absent more definitive design, siting, and construction information, it would be impossible to do more than offer uninformed speculation on the interaction, if any, between this potential development and designated critical habitat and whether the project may also affect the whale, requiring a consultation under section 7 due to the listing of the whale as an endangered

species. As such, it is not considered among the impacts contained in the Final RIR/4(b)(2)PA/FRFA's analysis.

Comment 72:

One comment states that Section 7.7 of the Draft RIR/4(b)(2)PA/IRFA did not analyze the Mt. Spur Geothermal Power Plant because a decision to go forward with the plant has not been made. Further, Table 6-28 of the Draft RIR/4(b)(2)PA/IRFA describes the status of the project as “pre-decisional, geothermal lease in place, no permits have been requested.” The comment further states that given Ormat Technologies' (the major lease holder for the Mt. Spur Geothermal development) better record of success than any of the tidal energy companies whose projects were analyzed in the Draft RIR/4(b)(2)PA/IRFA, Section 7.7 should be revised to include the potential costs of critical habitat designation to the project.

Response:

As per Sections 6.4.7 and 7.7 of the Final RIR/4(b)(2)PA/FRFA, based on the best scientific data available and research conducted by NMFS, Ormat Technologies is in the early development/initial exploration stage of the Mt. Spurr Geothermal Power Plant, and no permits have been requested. Additionally, given that no specific preferred plan or route for the transmission line(s) have been identified, it is unclear whether this potential project may affect the Cook Inlet beluga whale and/or its critical habitat. In light of the fact that Ormat Technologies will have to submit a site design and transmission line corridor proposal, apply for and get the necessary permits, and secure funding to develop this project, any analysis of economic impacts to the potential project arising exclusively from the designation of critical habitat would be highly speculative.

Comment 73:

A commenter notes that Section 6.4.7 of the Draft RIR/4(b)(2)PA/IRFA states that the Chakachamna Hydropower Plant project was reviewed, but determined to not have a connection with the critical habitat designation, due to its inland location and lack of physical connection with Cook Inlet. However, the project description clearly describes the project's planned measures to protect salmon, which are designated as a PCE of the critical habitat. The project would discharge water flow from the facility into the MacArthur River near its confluence with Cook Inlet. The power transmission lines may need to cross the MacArthur River, and potentially Cook Inlet, to reach Anchorage or the Kenai Peninsula. Chakachamna Power has identified the North Forelands Dock and Industrial Area as its logistics base for construction and operation of this project, which would result in an increase in vessel traffic through this area. A preliminary permit application for this project was filed with FERC on December 10, 2009. Because this project may affect a small portion of Cook Inlet beluga whales' habitat, but is highly unlikely to jeopardize the existence of the whales, project modification costs should be estimated. Section 7.7 of the Draft RIR/4(b)(2)PA/IRFA should be revised to include the potential costs of critical habitat designation to the Chakachamna Hydropower Plant project.

Response:

Based on the project description provided in the preliminary permit application for this project, filed with the Federal Energy Regulatory Commission (FERC) on December 10, 2009, the Chakachamna Hydropower Plant project is located inland of Cook Inlet, including the proposed transmission lines that would connect to the Chugach Electric Association's Beluga substation, which is also inland of Cook Inlet. The commenter has not provided any supporting information or empirical documentation to indicate a clear physical connection of the project with the waters of Cook Inlet, the beluga whale, or its critical habitat. If, as the commenter asserts, the North Forelands Dock and Industrial Area is proposed as the construction staging site and permit authorizations are sought for that activity, a section 7 consultation may be required. Given currently available information, however, no conclusive determination can be made; thus, the potential economic impact to the potential Chakachamna Hydropower Plant project is not analyzed in the Final RIR/4(b)(2)PAFIRFA.

Comment 74:

One comment by Chugach Electric Association notes that the Draft RIR/4(b)(2)PA/IRFA acknowledges NMFS' obligation under Executive Order 13211, regarding “Actions Concerning Regulations that Significantly Affect Energy Supply, Distribution, or Use,” to evaluate the impact of critical habitat designation on energy supply. However, the Draft RIR/4(b)(2)PA/IRFA appears to be devoid of any such analysis.

Response:

Section 10.2 of the Final RIR/4(b)(2)PA/FRFA presents the “Statement of Energy Effects” pursuant to Executive Order No. 13211, “Actions Concerning Regulations that Significantly Affect Energy Supply, Distribution, or Use,” issued May 18, 2001.

Comment 75:

Two comments state that the proposed designation of critical habitat to protect beluga whales in the Cook Inlet does not describe the economic impacts of the designation on the North Slope to Lower 48 through Canada gas pipeline project (also referred to as Alaska natural gas transportation project), nor how impacts of the designation on the economic, environmental, energy, and national security interests of the nation, relative to this project, which Congress has endorsed, were taken into consideration and balanced in accordance with Section 4 of the ESA.

Response:

Research conducted by NMFS through the development of the Final RIR/4(b)(2)PA/FRFA revealed that the proposed North Slope to Lower 48 through Canada gas pipeline project, if permitted, would not affect the Cook Inlet beluga whales' critical habitat. No new information or empirical documentation has been provided by the commenter with which to evaluate how the project would impact the critical habitat or vice versa.

Comment 76:

A commenter notes that the Draft RIR/4(b)(2)PA/IRFA should analyze the Alaska Natural Gas Development Authority (ANGDA) spur pipeline to Cook Inlet. ANGDA is planning a $2 billion pipeline to divert a portion of the gas from the North Slope to Lower 48 through Canada pipeline project to Cook Inlet, to replace dwindling local reserves and provide processed natural gas liquids for export from a to-be-developed facility, through Cook Inlet. This pipeline would run from Delta, through Glennallen, to the Beluga gas facility near Wasilla.

Response:

Section 6.4.1 of the Final RIR/4(b)(2)PA/FRFA discusses the subject proposed pipeline, referred to as Beluga to Fairbanks Natural Gas Pipeline Project. Potential impacts to this project are included in Table 6-28.

Comment 77:

Two comments state that Escopeta Oil's Kitchen Lights Unit project to bring a jack-up rig to the Cook Inlet this spring and drill the #1 Kitchen Lights Unit well was put on hold indefinitely because of the proposed critical habitat designation for Cook Inlet beluga whale. According to the commenters, to date Escopeta Oil has spent over $20 million on the project (estimate by the second commenter is $50 million), and this proposed designation has deterred this initial investment away from Cook Inlet. If Ecopeta Oil is not allowed to drill the Kitchen Lights Unit by the Federal Government, it will lose its significant investment in Alaska, and the State of Alaska and its people will also lose a long-term supply of natural gas and the jobs and revenues created from the Kitchen Lights Unit development program. Further, should an oil and gas company desire to perform the costly

proposition of drilling an offshore well in the Cook Inlet with this designation, it will have to budget millions of dollars for additional consultations, duplicative permits, delays, legal fees, and litigation—without any guarantee of drilling the first well.

Response:

Section 6.4.1 and 7.1.1 and Table 6-28 of the Final RIR/4(b)(2)PA/FRFA discuss the status and impacts to Escopeta Oil's Kitchen Lights Unit. Additional research conducted by NMFS reveals that the Kitchen Lights Unit program has a history of delays due to the company not being able to fulfill several commitments required not only for technically exploring its prospects, but also for meeting the legal terms of the State of Alaska's oil and gas leases. The latest available information suggests that, as part of its agreement with the State of Alaska to hold onto its Kitchen Lights leases, Escopeta Oil has to drill an exploration well in the unit by the end of 2010. However, following the proposed designation, the company asked the State of Alaska in a December 16, 2009, letter to guarantee no Federal interference in the company's Cook Inlet oil and gas drilling activities planned for 2010 (Petroleum News, December 20, 2009). The State did not offer such a guarantee (Petroleum News, December 27, 2009). It is anticipated that, while the project's potential to affect critical habitat could trigger the section 7 consultation process and may result in project modifications, there is no evidence suggesting that the potential loss of initial investment in Cook Inlet activities by the company due to the project being put on hold is attributable to the designation. Future economic impacts may arise from the need to consult under section 7 to avoid jeopardy and/or to avoid destroying or adversely modifying critical habitat. However, the commenter did not present any evidence indicating that there would be impacts attributable only to the critical habitat designation, nor when in the future such renewed activity might be expected.

Comment 78:

One commenter notes that impacts to the $4 billion Enstar bullet pipeline should be considered. The proposed pipeline would connect Alaska North Slope gas fields through Fairbanks to the Beluga gas facility. This project is competing with the ANGDA spur line project to supply both local consumption and liquid products export. According to the commenter, Enstar is currently pursuing Alaska environmental permits for this project.

Response:

Research conducted by NMFS suggests that Enstar bullet pipeline, now referred to as Alaska Stand Alone Pipeline (ASAP), is in the preliminary planning and engineering stage. The plan, initiated originally by Enstar Natural Gas, is now being coordinated by the Alaska Governor's office. The preparation of an Environmental Impact Statement has been initiated. Given that the project alternatives have not been finalized yet, it is unclear whether the pipeline itself will reach the waters of Cook Inlet; however, it is possible that some associated facilities may be located in the vicinity. Because the project is in such preliminary stages, what activities it may stimulate in Cook Inlet and how those activities would be impacted by the designation of the beluga whales' critical habitat is too speculative for consideration in the economic analysis.

Comment 79:

The Tyonek Native Corporation states that impacts of the proposed critical habitat designation on the following two projects should be considered in the analysis:

The Corporation is developing plans to mine and export high quality aggregate from its North Forelands Dock and Industrial Area using the existing adjacent pier, which would require modification (

see http://www.tyonek.com/Presentations/tnc-wci08.pdf

). According to the commenter, the project would result in increased vessel traffic through this area. This project is expected to have a total construction cost of approximately $20 million.

Alaska Natural Resources to Liquids recently completed a $1.5 million preliminary feasibility study with the help of the Alaska Industrial Development and Export Authority (

see http://www.aidea.org/PDF%20files/BelugaCTLoverview9-20-06.pdf

) on the Beluga Coal to Liquids Plant. Plans call for using coal from the Chuitna coal fields to produce 80,000 barrels per day of diesel and naphtha for U.S. West Coast markets. In addition, the facility would produce jet fuel and petrochemical feedstocks. This fuel would be shipped out of the existing North Forelands Dock, which would require modification, and result in increased vessel traffic through this area. This project is expected to have a total construction cost, including supporting infrastructure, of approximately $12 billion.

Because these projects may affect a small portion of Cook Inlet beluga whale habitat, but are highly unlikely to jeopardize the existence of the whales, project modification costs should be estimated. The Corporation has requested that Sections 6.4.2, 7-2, and 9-2-1.1 and Table 6-28 of the Draft RIR/4(b)(2)PA/IRFA be revised to include the potential cost impacts of critical habitat designation to these projects.

Response:

The commenter has not provided sufficient information regarding the current stages of the projects, or the likelihood of these occurring in the next 10 years, with which to conduct an evaluation of the economic impacts on these project proposals from the designation of critical habitat. Even if the projects were reasonably likely to occur during the time period under analysis, the modification of the North Forelands Dock would require a Federal permit, likely from the U.S. Army Corps of Engineers (ACOE), which would likely trigger a section 7 consultation (possibly two—one for each project). The consultation could be formal if the dock modification requires pile driving or informal otherwise. However, the costs associated with the consultation to ensure that the project does not destroy or adversely modify critical habitat would be co-extensive with those arising from the consultation to ensure that the project does not jeopardize the whales' existence. Such consultation is required if a Federal action may affect the endangered Cook Inlet beluga whale (50 CFR 402.14).

As for the increase in vessel traffic, it would be considered an indirect, interrelated, or interdependent action under the consultation. Given that it is unclear at this point if the increase in vessel traffic associated with the projects would create enough noise to cause abandonment of habitat, the increased vessel traffic would likely raise questions concerning whether the action would result in takings of the whale. Accordingly, economic impacts associated with the consultation over that action would be co-extensive between the jeopardy and destruction/adverse modification of critical habitat standards.

Comment 80:

A commenter notes that the proposed critical habitat designation is likely to have a significant impact on exploration for and production of natural gas in the Cook Inlet region, which could directly affect the cost of electricity to Chugach Electric Association's customers. Chugach generates most of its electricity from natural gas produced in the Cook Inlet region. Designating the upper half of Cook Inlet, South to below Kalgin Island, as beluga whale critical habitat sweeps in all of the existing offshore oil and gas fields in the Inlet. This is likely to have an impact on all future oil and gas exploration in the region. The Draft RIR/4(b)(2)PA/IRFA contains no meaningful discussion of the impact this will have on future oil and gas

exploration and development in Cook Inlet, and no discussion of the resulting impact on the cost of electricity in the Railbelt region, where most of Alaska's population is located. These economic impacts should have been part of the Draft RIR/4(b)(2)PA/IRFA. When these costs are given their proper weight, it should be readily apparent that the potential benefits to the whales of an unfocused and overly broad critical habitat designation are outweighed by the resulting economic impacts.

Response:

As has been explained in more detail in responses to other similar comments above, oil and gas exploration activities are already required to comply with ESA section 7's jeopardy standard due to the listing of Cook Inlet beluga whale. It is the additional economic impacts that stem from the designation of critical habitat that comprise the economic impacts of section 7 consultations analyzed pursuant to section 4(b)(2) of the ESA.

The comment suggests that future oil and gas exploration in Cook Inlet will be adversely impacted by the critical habitat designation, with resulting costs imposed on electricity users throughout the Railbelt region of Alaska, in the form of (implicitly) higher costs. We do not agree with these assertions for the following reasons. First, the incremental cost uniquely attributable to the critical habitat designation as it pertains to project review within Cook Inlet has been demonstrated to be very small. Economic impacts arising from the need to consult under section 7's jeopardy standard are not considered to be economic impacts arising from the designation of critical habitat. After review of the best scientific data available regarding the status of the beluga whale and the nature of the reasonably foreseeable Federal actions in and around Cook Inlet, we concluded that a substantial portion of the economic impacts associated with the designation of critical habitat are co-extensive with those arising from the listing decision. Second, the empirical data and commercial information (much of which is cited by numerous commenters referenced above) suggest that supplies of gas in Cook Inlet are nearing exhaustion. This conclusion is also evidenced in the marketplace by the several competing proposals to supply North Slope gas to the Cook Inlet region via pipeline. If, as asserted by the region's oil and gas industry sector representatives (see submitted comments on gas pipelines and critical habitat designation, above), tens of millions to hundreds of millions of dollars have been invested by several competing interests in efforts to build a gas delivery system to “move available gas into the Cook Inlet region” in response to dwindling local supplies, it appears that the marketplace and nature of supply and demand are having, and will continue to have, significant economic impacts on future Cook Inlet gas exploration.

Comment 81:

Several comments state that the proposed designation of the entire Cook Inlet as critical habitat for the beluga whale creates an additional stigma towards future exploration and development in the Cook Inlet region. The negative impact created by this designation creates an anti-development stigma that is contrary to the national energy policy and prejudices Alaska's ability to responsibly explore and develop its natural resources for the benefit of all Alaskans.

Potential investors may withdraw their support for projects in the Cook Inlet region because of increased project costs. The additional costs include: compliance costs, litigation costs related to suits initiated by NGOs, and perhaps the greatest of all, lost opportunity costs resulting from loss of investment. The evaluation of the economic costs of critical habitat must include a complete evaluation of these factors by independent investigators from outside the agencies involved in the listing and habitat designation process.

Response:

While substantial areas of Cook Inlet are proposed for inclusion in this designation action, critical habitat does not extend to the entire inlet. Indeed, the vast majority of the lower inlet is not proposed for inclusion. We cannot speculate on “stigma” or “loss of investor interest” as no empirical evidence or analysis of such effects for Cook Inlet exists. Moreover, as our economic impact analysis indicates, most of the economic impacts on future natural resource exploration and development in Cook Inlet arising from ESA compliance requirements would exist even without the designation of critical habitat.

Comment 82:

A number of commenters note that the proposed critical habitat designation may affect barge and vessel activity in Cook Inlet, resulting in impacts to their projects. Critical habitat designations could increase costs by requiring observers on board, decrease efficiency by setting speed limits or time and area restrictions, and ultimately raise the cost of all goods, and subsequent services, paid for by Alaskans. Any shipping delays will have particularly significant consequences for this area, because shipping schedules are affected by tides, and delays are compounded by the fact that Anchorage has minimal storage capacity for goods and must carefully coordinate shipping schedules. Certain planned projects are anticipated to significantly increase vessel traffic, and commenters request these impacts be included in the Draft RIR/4(b)(2)PA/IRFA.

Response:

Section 7 of the ESA does not apply generically to vessel movement or activity. As explained previously, section 7's consultation requirements apply only when there is a Federal action (actions authorized, funded, or carried out by a Federal agency). The designation of critical habitat for the Cook Inlet beluga whale is not anticipated to require any additional restrictions on barge and vessel movement, above and beyond any such restrictions already being imposed following section 7 consultations to avoid jeopardy. Generally, where a proposed Federal action will result in increases in vessel traffic, such increases are considered indirect effects or arising from interrelated or interdependent actions under section 7 consultation regulations (50 CFR 402.02). Given that it is unclear at this point if the potential increases in vessel traffic associated with projects in Cook Inlet could create enough noise to result in the abandonment of critical habitat areas, the increased vessel traffic, if it were to represent a concern, would likely be considered a take issue. Accordingly, the economic impacts from that consultation would be attributable to the listing of the whale as an endangered species.

Comment 83:

Some comments suggest that in order to conform to the critical habitat designation, the Anchorage Water and Wastewater Authority (AWWU) must upgrade its sewage treatment plant, which would cost between $400 million and $1 billion. This could potentially triple Anchorage residents' wastewater bills. Nowhere is this reflected or accounted for in the Draft RIR/4(b)(2)PA/IRFA, which is clearly contrary to the requirements of the ESA.

Response:

Sections 6.4.6 and 7.6 and Table 6-28 of the Final RIR/4(b)(2)PA/FRFA describe the potential costs of the proposed critical habitat designation to AWWU. The costs that can appropriately be attributed to critical habitat designation are anticipated to stem solely from a formal section 7 consultation. It is expected that in compliance with the CWA, AWWU may be required by the Environmental Protection Agency (EPA) to upgrade its John Asplund Wastewater Treatment Plant (WWTP), to meet national waste water discharge standards. The compliance exemption for the facility

has expired and EPA is currently reviewing the facility's operating permit. Therefore, any resulting cost associated with the upgrade or improvement of the plant to meet CWA mandates would not be attributable to the designation of Cook Inlet beluga whale critical habitat.

Comment 84:

One comment notes that the City of Kenai operates a wastewater treatment plant at the mouth of the Kenai River. The permitted discharge is into Cook Inlet. We expect, but cannot confirm, that the City will have to comply with new effluent standards, as a result of the designation. The cost of plant upgrades could range from $250,000 to $50,000,000.

Response:

The Final RIR/4(b)(2)PA/FRFA discusses the Kenai Wastewater Treatment Facility in Section 6.4.6. The facility is considered a major discharger under EPA standards. As discussed in the response to the previous comment regarding John Asplund WWTP, any required upgrades to the facility in order to comply with CWA standards would not be attributable to the critical habitat designation.

Comment 85:

One commenter states that there is increasing demand for coal in Pacific Rim countries. After many years of lackluster demand in the export coal market, prospects are looking better for development of a coal export business, and Cook Inlet could play a key role in that development. Critical habitat designation in the Port Mackenzie area and for the shipping lanes through upper Cook Inlet could be a serious impediment to coal and other export opportunities. Clearly, there are many opponents to coal development, and critical habitat designation would provide them with a powerful tool to hamper and potentially stop coal and other bulk commodity exports, with no corresponding benefit to the beluga whales.

Response:

As explained above, the designation of critical habitat for the Cook Inlet beluga whale is not anticipated to require any additional restrictions on barge and vessel movement in Cook Inlet, above and beyond those already being imposed following section 7 consultations to avoid jeopardy.

Comment 86:

Several comments suggest that the proposed critical habitat designation could affect tourism in Southcentral Alaska. Holland America Cruise Lines is planning to bring numerous cruise ships into the POA and Homer. Future moorings by the industry could be decreased or eliminated as a result of a critical habitat designation. Subsequently, decrease in the number of visitors to Southcentral Alaska could transpire as limitations are placed on sport fishing, sightseeing cruises, and other operations. Local communities will be significantly impacted through decreased bed and rental taxes.

Response:

As discussed in an earlier response, the POA is not included in the proposed critical habitat designation because of impacts to national security. Therefore, future moorings at POA are not likely to be affected by the designation of critical habitat for the Cook Inlet beluga whale.

Comment 87:

A large number of comments provided both through written letters and orally during the public hearings assert they place a very great value upon, and derive substantial personal utility and enjoyment from, watching Cook Inlet beluga whales and having the opportunity to interact with the species in a wild environment. Further, some commenters made special note of the need to preserve this experience for future generations.

Response:

We acknowledge these comments on the benefits accruing to area residents, tourists, and other visitors to Cook Inlet, and the value experienced by those interested in maintaining for future generations the opportunity to encounter the Cook Inlet beluga whale in its native habitat in such close proximity to a large population center. We provided an extensive treatment of the theoretical foundations, technical considerations, and empirical methodologies that have been developed and applied to quantitatively measure and evaluate economic benefits attributable to non-market use and passive-use values, as reflected in these comments. We believe that the designation of critical habitat will play a major role in ensuring the conservation of the Cook Inlet beluga whale to the benefit of current and future generations.

Comment 88:

Several comments question the benefits of the proposed critical habitat designation (due to preserving the natural beauty of Cook Inlet) in attracting and retaining workers, and in adding value to visitors who recreate in the area. Concern is expressed that benefits in retaining workers are hypothetical and that Cook Inlet is one of the most pristine areas of the United States, such that workers would not reasonably be affected by the proposed critical habitat designation in their location decision. One commenter also suggested that these benefits can only be realized if there are jobs present that enable people to live and work in the Cook Inlet area.

Response:

It is well documented that quality of life factors, including environmental quality and recreation opportunities, enter into employee and business location decisions (see Love and Crompton, 1999; Florida, R, 2000; Granger and Blomquist, 1999). To the extent that the proposed critical habitat designation preserves the environmental quality, natural resource amenities, and recreation opportunities in Cook Inlet, visitors and residents alike will benefit. It is not known how the incremental improvement in environmental quality, due to the proposed critical habitat designation, will affect the ability of any particular business or industry to attract and retain employees; hence, the Final RIR/4(b)(2)PA/FRFA notes that these benefits are likely to be “relatively small” and are not quantified in the analysis. Regarding job growth, recreation and tourism industries depend on aesthetic amenities, environmental quality, access to fish and wildlife (

e.g.,

fishing, hunting, viewing, photographing), etc., and it is precisely these aspects and attributes that are expected to benefit due to the proposed critical habitat designation in Cook Inlet.

Comment 89:

Several comments expressed concern about the lack of quantification of benefits of the proposed critical habitat designation. According to some comments, this leads to an overstatement of speculative or hypothetical benefits, and an arbitrary and biased conclusion that the proposed critical habitat designation results in a net benefit to the Nation. Additional concern is expressed that the net benefit finding is not replicable, and that there is no evidence or factual basis for these benefits. One comment also notes that well-being, as a measure of benefit, is ill-defined, and questions what `goods and services' would be provided to the public due to the proposed critical habitat designation that would increase well-being. Other comments assert that, by not quantifying benefits, the analysis understates the benefits of the proposed critical habitat designation.

Response:

The principal benefit of the proposed critical habitat designation is the avoidance of destruction or adverse modification of the critical habitat of the Cook Inlet beluga whale, supporting the conservation and recovery of this endangered species, as provided for under the ESA. These benefits are biological. Ancillary economic, socioeconomic, cultural, educational, and procedural benefits are also expected to accrue, associated with the designation and related preservation and possible incremental improvement of the inlet's environmental quality. Quantifying economic benefits requires identifying the net change in environmental amenities and service

flows, such as air quality, water quality, or fish and wildlife populations (among others), specifically attributable to, in this instance, the proposed Cook Inlet beluga whale critical habitat designation. While the degree of biological, environmental, and economic benefit is not readily amenable to quantification, it is known that relatively small changes in environmental quality and wildlife abundance can provide significant economic benefits (also referred to as increased well-being or utility) through both use and non-use values. Evidence of these types of values is documented in the Final RIR/4(b)(2)PA/FRFA. Thus, while it is not possible to monetize, or even quantify these benefits, the best economic data available provide substantial evidence that the magnitude of anticipated benefits outweigh the anticipated costs. This is supported by the fact that we have determined, based upon the best scientific data available, the incremental cost attributable to the proposed critical habitat designation is likely small, relative to the expected benefits.

Comment 90:

Several comments note that NMFS has stated it has little specific empirical information with which to predict how consultations initiated by critical habitat considerations might lead to any particular project modification, yet the stated primary benefit in the Draft RIR/4(b)(2)PA/IRFA of critical habitat is the requirement for consultations to ensure that action agency actions do not modify or destroy critical habitat. These comments assert that NMFS has not shown how the measurable improvement would be attributable to the proposed critical habitat designation and, thus, lacks a factual basis for estimating benefits. Similarly, several comments note that it is important to distinguish the incremental benefits of the proposed critical habitat designation from the baseline benefits of listing the Cook Inlet beluga whale, as well as other existing management and regulatory requirements.

Response:

The commenters are correct that we have stated that the primary benefit of critical habitat designation is the biological benefit that will accrue from consultations that result in avoiding or minimizing adverse modification or destruction of critical habitat. As stated in the Final RIR/4(b)(2)PA/FRFA, “The primary driver for benefits from [the critical habitat designation] is a potential change in the quality or condition of the critical habitat absent [the critical habitat designation].” Critical habitat designation is, fundamentally, an action to promote the conservation of the species. Ancillary economic, socioeconomic, educational, procedural, cultural, and aesthetic benefits (among others) also accrue from the critical habitat designation, contributing to the aggregate benefit measure. While the exact number of affected projects and the precise types of project modifications that may be uniquely attributable to the critical habitat designation (and not the listing of the Cook Inlet beluga whale) cannot be known, we reasonably assume that whatever modifications occur, they will contribute to the conservation of Cook Inlet beluga whales and generate biological benefits that yield associated economic value.

We agree that, in assessing the benefits arising from the designation of critical habitat, we must focus on those incremental benefits that are uniquely attributable to the designation and not to the endangered listing. Our analysis endeavored to distinguish between such incremental and co-extensive benefits.

Comment 91:

Numerous comments emphasize the social and cultural importance of the beluga whale to the region, as indicated by the naming of places, such as Beluga Lake, in the region and the traditional ways that are centered on the Cook Inlet beluga whale. Several comments indicate that the dollar value of the social and cultural benefits is very high.

Response:

The Final RIR/4(b)(2)PA/FRFA discusses the cultural use and passive use importance of the Cook Inlet beluga whale and notes such examples as the traditional subsistence and cultural harvesting by Alaska Native groups, the naming of places, public educational displays, numerous technical and popular books, and the utility accruing to individuals from the knowledge that Cook Inlet beluga whales persist within their natural habitat in Cook Inlet. Cultural use values are recognized as real and potentially significant benefits deriving from the proposed critical habitat designation, but have not been estimated in dollar terms, owing to the complexity, high cost, and controversy associated with estimation of such values. Cultural values have been asserted by some to be unique to each group of people and, as such, do not readily lend themselves to monetary approximation. Similarly, cultural passive use values are not quantified, as there are not appropriate studies available upon which to base rigorous, quantitative estimates.

Comment 92:

A number of comments question the potential of the proposed critical habitat designation to increase fish stocks and benefit commercial and sport fisheries. Some comments cite baseline requirements to maintain the reproductive capacity of fish stocks as indicating that critical habitat will not increase stocks, while other comments note that, to the extent that critical habitat increases the Cook Inlet beluga whale population, consumption of fish by beluga whales will result in a net decrease in available fish for commercial and sport anglers. One comment also asserts that fishing will be limited in the proposed critical habitat designation if it is found to have potential adverse effects on the environment, while other comments note that the analysis should further assess the benefits of enhanced commercial and sport fisheries attributable to the proposed critical habitat designation.

Response:

As noted in the Final RIR/4(b)(2)PA/FRFA, it is possible that commercial and sport fisheries will experience small, indirect benefits attributable to the proposed critical habitat designation, as fish stocks share habitat with Cook Inlet beluga whales and benefit from avoidance of destruction or adverse modification of that (

i.e.,

their common) habitat. Effects of the proposed critical habitat designation on fishing activity are likely to be limited, because most of the fisheries in Cook Inlet occur in state waters and are managed by the State of Alaska. Though speculative, were a Federal action to occur that implicated those fisheries, effects from their management would likely be considered in the cumulative effects section of the biological opinion (

See

50 CFR 402.02). At this time, however, it is impossible to speculate as to what that Federal action would be and how the state-managed fisheries would be analyzed. As described in the Final Draft RIR/4(b)(2)PA/FRFA, it is anticipated that there will be an informal consultation, approximately every 5 years, over Federal management of Cook Inlet commercial groundfish fisheries, attributable to the designation of the beluga whales' critical habitat.

Comment 93:

Several comments question the benefit of education and outreach associated with the proposed critical habitat designation, and assert that this is a baseline benefit that accrues due to the 2008 Conservation Plan for the Beluga Whale.

Response:

The volume of public comments received on the Draft RIR/4(b)(2)PA/IRFA indicates the level of public awareness of this process and the potential for education and outreach benefits. Furthermore, the consultation process, itself, serves to increase

awareness and sensitivity in design, execution, and operation of proposed projects.

Comment 94:

Several comments note that the Alaska tourism industry, including activities such as whale watching, are important to the Alaskan economy and may benefit from the proposed critical habitat designation. These comments note that tourists are attracted to Alaska because of the scenic beauty and wildlife viewing opport

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