Proposal To Establish an Administrative Appeal Process for the Regulatory Programs of the Corps of Engineers

SUMMARY: The Corps of Engineers is proposing to establish an

administrative appeal process to include in its regulatory program

regulations (33 CFR parts 320-330). There is currently no

administrative appeal process under which parties may contest Corps of

Engineers regulatory determinations. Adverse decisions must be

challenged in Federal District Court, and this formal judicial process

may be time-consuming and financially burdensome for many parties. The

proposed rule would provide permit applicants and landowners an

opportunity to appeal permit denials and jurisdictional determinations.

DATES: Comments must be received by September 5, 1995.

ADDRESSES: Comments should be submitted in writing to: Office of the

Chief of Engineers, ATTN: CECW-OR, 20 Massachusetts Avenue NW.,

Washington, DC 20314-1000. Comments will be available for examination

in Corps District and Division offices or at the Office of the Chief of

Engineers, Room 6225, Pulaski Building, 20 Massachusetts Avenue NW.,

Washington, DC 20314-1000.

FOR FURTHER INFORMATION CONTACT:

Mr. Sam Collinson or Mr. Michael L. Davis, Corps of Engineers

Regulatory Branch, (202) 761-0199.

SUPPLEMENTARY INFORMATION:

I. Background

Shortly after coming into office, the Clinton Administration

convened an interagency working group to address legitimate concerns

with Federal wetlands policy. After hearing from States, developers,

farmers, environmental interests, members of Congress, and scientists,

the working group developed a comprehensive, 40-point plan to enhance

wetlands protection, while making wetlands regulations more fair,

flexible, and effective to everyone, including America's small

landowners. The Plan was issued on August 24, 1993. It emphasizes

improving Federal wetlands policy through various means, including

streamlining wetlands permitting programs. One of several approaches

identified in the Plan for achieving such streamlining is through

development by the Corps of a Clean Water Act Section 404

administrative appeals process, to be implemented after a public

rulemaking. The Plan provides that the process will be designed to

allow for administrative appeals of Section 404 geographic

jurisdictional determinations, permit denials, and administrative

penalties.

The rule proposed herein is responsive to the President's

directive. The appeal process is designed to allow administrative

appeals to the Corps regarding two distinct decisions: (1) That a

geographic area, including a particular parcel of property that is

determined to be a wetland as defined in 33 CFR 328.3(b) and delineated

in accordance with the Federal manual for delineating and identifying

wetlands, is subject to Corps regulatory jurisdiction pursuant to

Section 404 of the Clean Water Act and/or Section 10 of the Rivers and

Harbors Act of 1899; and (2) denial with prejudice by the District

Engineer of a Department of the Army permit, which includes cases where

a proffered permit is refused by the applicant because the applicant

objects to the terms or special conditions of the proffered permit and

the permit is subsequently denied with prejudice by the District

Engineer. Consistent with the Plan and as explained below, third

parties can participate only in applicant appeals of permit denials.

As indicated above, the Plan also addresses administrative appeals

of administrative penalty assessments. Section 309(g) of the CWA

authorizes the Corps and EPA to assess administrative penalties for,

among other things, unauthorized discharges of dredged or fill material

into wetlands and other waters of the United States in violation of

Section 404. The CWA establishes two classes of administratively

assessed penalties, which differ with respect to maximum assessment and

prescribed procedure. EPA and the Corps have implemented the

requirements of Section 309(g) as follows. With regard to EPA, proposed

assessments of Class II administrative penalties for Section 404

violations can be reviewed by an Administrative Law Judge through a

hearing process, the procedures for which are set forth at 40 CFR Part

22. EPA proposed assessments of Class I administrative penalties can be

reviewed by a Presiding Officer through a hearing process according to

procedures set forth at 40 CFR Part 28. (Note that EPA issued a

proposed rule establishing such procedures, see 56 FR 29996 (July 1,

1991); pending issuance of a final rule, the EPA is applying the

proposed rule as EPA guidance.) With regard to the Corps, proposed

assessments of Class I administrative penalties, like EPA's process,

can be reviewed by a Presiding Officer through a hearing process

according to procedures set forth at 33 CFR 326. The Corps is

developing, but has not yet proposed, regulations for assessing Class

II administrative penalties. The Corps expects that its Class II

regulations will be similar to those of EPA's.

Also consistent with the Administration Wetlands Plan, the August

1993 Interagency Memorandum of Agreement (MOA) between the Department

of Agriculture, the Environmental Protection Agency, the Department of

the Interior and the Department of the Army concerning the delineation

of wetlands for purposes of Section 404 of the CWA and Subtitle B of

the Food Security Act, provides that persons who are adversely affected

by Natural Resources Conservation Service (NRCS) wetland delineations

on agricultural lands may appeal such wetland delineations under NRCS

administrative appeal procedures published at 7 CFR Part 614. Under

these procedures, any person who is adversely or potentially adversely

affected by an NRCS wetland delineation can appeal that decision. This

may be an owner, operator, tenant or partner of the farm to which the

NRCS decision applies. The NRCS appeals procedures currently has four

levels: (1) The District Conservationist, (2) the Area Conservationist,

(3) the State Conservationist, and (4) the Chief of NRCS. The decision

of the Chief is final. However, as a result of USDA reorganization the

current NRCS appeals process is being revised. Furthermore, according

to the MOA, in circumstances where a landowner submits an appeal to

NRCS and the State Conservationist is considering a change in the

original delineation made by NRCS, the State Conservationist notifies

the appropriate Corps and EPA officials to provide those agencies an

opportunity for their participation and input on the appeal. The Fish

and Wildlife Service is also consulted. The Corps and EPA reserve the

right, on a case-by-case basis, to determine that a revised delineation

resulting from an NRCS appeal is not valid for the purposes of Section

404 jurisdiction. However, any subsequent jurisdiction determination by

the Corps would be

[[Page 37281]]

appealable under the appeals process being proposed today.

The proposed administrative appeal process for a final Corps

jurisdiction determination is a two-level process. The initial appeal

is to an independent jurisdictional expert within a Corps District

Office. The second level appeal would be to a regulatory expert within

a Corps Division Office. Depending on the specific issues raised the

individuals responsible for the appeal process may consult technical

experts from other Corps offices. The proposed administrative appeal

process for permit denials is a one-level process. The appeal would be

to the Corps Division Office. The appeal process would be conducted by

a Review Officer in the Division Regulatory Office and the final appeal

decision would be made by the Division Engineer. In cases where an

applicant refuses a proffered permit because of objectionable

conditions, the District Engineer will review the case and will deny

the permit, issue the permit without the condition, or offer the

applicant a permit with different conditions, which if refused would be

denied. In those cases where such proffered permits are denied the

applicant may appeal the denial to the Division Engineer.

Filing of a jurisdictional determination appeal under this rule

will be limited to the permit applicant or the landowner (i.e., and

individual who has an identifiable and substantial legal interest in

the property.) The authorized agent of the permit applicant or the

landowner may also file the appeal.

Most Corps districts currently have an informal consultation

procedure wherein disagreements on jurisdictional determinations or

permit decisions are discussed between the Corps Project Manager/

supervisor and the landowner/agent/consultant. Based upon additional

information or differing interpretations of the data or issues, the

preliminary jurisdictional determination or permit decision may be

revised or conditioned to the mutual satisfaction of the parties. The

Corps encourages the continued use of the informal consultation process

as the most efficient and responsive means of resolving jurisdictional

and permit issues. If informal consultation proves fruitless, the

proposed administrative appeals process provides a formal

administrative course of action.

Corps districts also respond to jurisdictional queries by providing

an ``office'' jurisdictional determination, based on a review of

wetland inventory maps, State or local wetland maps, topographic maps,

soils maps, aerial photography, and land-use plans or studies. These

office or preliminary jurisdictional determinations are advisory in

nature and provided primarily for planning purposes and may not be

appealed.

To ensure compliance with national policies and procedures, and

consistency among the administrative appeals officers within Division

and District regulatory offices, the administrative appeals program

will be monitored by the office of the Chief of Engineers. Implementing

guidance will be provided when deemed appropriate.

As discussed in further detail below, additional manpower and

funding would be necessary for the Corps to implement an administrative

appeals process for its regulatory program. The President has included

$6 million for the administrative appeals process in the FY 96 budget

submitted to Congress. Additionally, training will be necessary for the

additional personnel hired to hear the appeal cases and some

organizational adjustments may be needed to accommodate an appeals

process. Given these considerations, we anticipate that implementation

of an administrative appeals process could be accomplished no later

than 6 months after the effective date of a final rule. Review officers

at Divisions and Districts may begin hearing cases before the projected

implementation date if funding, staffing, and training are completed.

II. Proposed Rule Organization

The proposed administrative appeals process rule is organized into

the following sections:

Section 331.1, Purpose and Policy, describes the basic purpose of

the proposed rule and the Corps of Engineers policies regarding the

appeals process.

Section 331.2, Definitions, contains the definitions of important

terms that are used throughout the proposed rule. The following terms

are defined in this section: Wetland delineation, jurisdictional

determination, permit denial, appealable action, affected party,

appellant, review officer, notification of appeals process, and request

for appeal.

Section 331.3, Review Officers, describes the independence,

authority and organizational location of the review officers (ROs). ROs

for jurisdictional determinations would be located in District and

Division regulatory offices and the ROs for permit denials would be

located in Division regulatory offices.

Section 331.4, Notification of Appealable Actions, would require

that the Corps district office send notification of each appealable

action to the affected party in writing. Each notification would

contain additional information on the administrative appeals process

and provide a form that the affected party must use to request an

appeal.

Section 331.5, Criteria, describes the criteria which must be met

for an action to qualify for the appeals process and also lists

specific situations which would preclude an action from qualifying for

the appeals process.

Section 331.6, Filing Appeals, provides 60 days from the date on

the letter of notification of the appealable action, for the affected

party to submit a request for appeal to the Corps. In filing the

appeal, the affected party must also grant the Corps the right of entry

onto the property in order to conduct appropriate field testing and

data collection.

Section 331.7, Review Procedures, describes the procedures for

reviewing a request for appeal (RFA). First, the RFA must be complete

and meet the established criteria for appeal. If requested, or

determined to be necessary, the RO also has the discretion to conduct a

review meeting with the appellant for jurisdictional determinations.

For permit denials, an appeal review conference will be held within 60

days after receipt of the RFA. Procedures for conducting the conference

are included.

Section 331.8, Timeframes for Final Appeals Decisions, establishes

the maximum time limits for Corps final appeals decisions.

Section 331.9, Final Appeals Decisions, describes the potential

outcomes of an appeal process for an appealable action and concludes

the administrative appeals process. Additionally, this section

discusses the timeframes for the ROs, District Engineers and Division

Engineers to reach a final decision on the merits of the appeal.

Section 331.10, Final Agency Decisions, describes when a final

agency decision has been made for an action that has been appealed.

Section 331.11, Unauthorized Activities, discusses the policies and

procedures for administrative appeals of appealable actions involving

unauthorized activities.

Finally, section 331.12, Exhaustion of Administrative Remedies,

describes the administrative process and remedies that an appellant

must exhaust before he can seek further review or relief from an

adverse action through a judicial action in Federal District Court.

[[Page 37282]]

III. Administrative Appeal of Jurisdictional Determinations

A. Background

In the day to day implementation of the Clean Water Act Section 404

Regulatory Program, the Corps of Engineers has the primary

responsibility for determining whether any particular geographic area,

including a wetland, is subject to Corps regulatory authority under

section 404 of the Clean Water Act and/or section 10 of the Rivers and

Harbors Act of 1899. The administrative appeals process would apply to

jurisdictional determinations of geographic extent of waters of the

United States.

Currently, the 1987 Corps of Engineers Wetland Delineation Manual

(1987 Manual) is used for wetland delineations, which may be performed

by Corps, Environmental Protection Agency or Natural Resources

Conservation Service employees, the applicant, or a private consultant

hired by the applicant. However, if the wetland delineation is

performed by the applicant or the applicant's consultant, it is the

Corps' responsibility to verify the accuracy of the wetland

delineation. Wetland delineations typically constitute two separate

determinations: first, a decision that an area falls within the

technical definition of a wetland; and second, the establishment of how

much of the area is wetland, i.e., the boundary or dividing line

between wetlands and uplands by applying the 1987 Manual. When a

wetland delineation is part of a jurisdictional determination, which

establishes whether a particular area is subject to regulatory

authority under section 404 of the Clean Water Act, decisions regarding

presence, scope and extent of wetlands, adjacency of wetlands to a

waterbody, and the interstate commerce nexus for isolated waters would

be appealable under this proposed rule.

The proposed rule would establish a two level administrative

appeals process for jurisdictional determinations. The first level

appeal would be conducted by a review officer (RO) located in a Corps

District regulatory office. Larger districts may require more than one

RO. The second level appeal would be conducted by a review officer in

the Corps Division regulatory office. While we are proposing a two

level appeal process for jurisdictional determinations, we are seeking

comments on whether the appeals process should be a one level appeals

process and, if so, whether the appeal should be to the District or

Division Engineer.

B. First Level Appeal--District Office

The District Engineer, or designee, is responsible for the review

of and decision on the first level appeal of jurisdictional

determinations. The District Engineer may retain or delegate either or

both, the RO responsibilities and the appeals decision to the same or

different Corps officials.

We are proposing that the RO should be, or should have the support

of, a qualified delineation specialist who has extensive experience in

applying the technical criteria of the current wetland delineation

manual, is familiar with local geophysical and climatological

conditions, and has extensive experience in the determination of

jurisdiction. Based on our review of regulatory program requirements

and past experiences, we believe that Corps personnel in the respective

districts are the best trained and most experienced wetland

delineators. Additionally, expert wetland delineators in District

offices are usually very experienced with regional geographic

jurisdiction issues. Our review also focused on the importance of

ensuring that the RO be insulated from the influence of the District's

regulatory staff responsible for the appealable action. Therefore, we

are also proposing that the RO report directly to the District's

Regulatory Branch Chief. This arrangement would remove the RO from day-

to-day involvement in routine delineation and jurisdictional decisions

made by Regulatory Branch project managers, unit chiefs, and section

chiefs. For matters involving routine delineation and jurisdictional

decisions, the RO would be equal or above all decision-makers in the

Regulatory Branch Office, except for the Regulatory Branch Chief.

Furthermore, any particular RO would be disqualified from a case if the

RO had worked directly on the case, had involvement in reviewing or

providing guidance on the case, or if the decision-maker on the action

was the Regulatory Branch Chief, or higher level official. In such

circumstances, the Regulatory Branch Chief or higher level decision-

maker (at least one level higher than the decision-maker) would appoint

an independent RO. We are proposing to locate the RO with the

Regulatory Branch Offices within the Districts, because we believe it

is critical for the ROs to maintain a high level of expertise and

experience with local wetland and jurisdictional issues. Furthermore,

the ROs could also administer the Corps Wetland Delineator

Certification Program and conduct in-house supplemental training in

jurisdictional determinations.

The proposed administrative appeals process for jurisdictional

determinations would be initiated by the landowner filing a request for

appeal (RFA). The appeal must be filed within 60 days of the issuance

of a formal jurisdictional determination by the Corps. If work is

authorized prior to the end of this 60 day period, either by general or

individual permit, and a permittee wishes to request an appeal, the

appeal must be filed and the appeal process completed prior to the

commencement of any work in the area identified as waters of the U.S.,

or any work that could alter the hydrology of the waters. Unauthorized

work may not be conducted to avoid regulatory jurisdiction over an area

by alteration of its wetland characteristics.

The 60-day filing deadline is considered to provide adequate time

for an appellant to submit an appeal. It is recognized, however, that

in some cases data cannot be obtained in certain seasons or is

complicated by disturbed site conditions. Under these circumstances,

the appellant may include in the RFA a request for a time extension and

provide reasons to support the request. The appeals Review Officer (RO)

will consider the request and may grant a reasonable extension of time

to enable the appellant to gather and submit additional data. The RO

also has discretion to extend the time period for such circumstances to

gather data or conduct research that is deemed necessary to reach a

valid conclusion. We are proposing that, in such circumstances, the

time for the total appeals process (from receipt of the RFA to the RO's

decision on the merits of the appeal) will be completed as soon as

possible but will not extend beyond twelve months from the date of

receipt of the appellant's complete RFA. As an option to this twelve

month maximum time frame, we are also seeking comments on establishing

the maximum time frame for an extension at nine months.

The RO's evaluation process of the appeal includes a review of the

appellant's RFA, supporting data, the Corps jurisdictional

determination, and any other available data to determine if a site

visit and/or any additional information is needed to complete the

review. The RO will complete this review of the administrative record

within 30 days of receipt of the appellant's complete RFA. If the RO

determines that no additional data is required and that no site visit

is necessary or requested by the appellant, a decision on the merits of

the appeal will be made within 60 days after receipt of the complete

RFA. If the RO

[[Page 37283]]

determines that additional data is needed, or if a site visit is

necessary or requested, the RO will schedule the completion of this

work at the earliest practicable time. The RO, or other designated

Corps official, would then make a decision on the merits of the appeal

within 30 days after the receipt of new information, completion of the

site visit, or the collection of data. However, in no case shall the

data collection or site visit extend the total appeals review time for

the RO, or other designated Corps official, to make a decision on the

merits of the appeal beyond twelve months after receipt of the RFA.

In completing the evaluation process, the District RO will either:

(1) Determine that the appeal has no merit; (2) determine that the

appeal has merit and notify the Corps regulatory official of the

appropriate course of action to be taken; or (3) determine that the

appeal has merit and revise the jurisdictional determination. The Corps

jurisdictional determination resulting from the appeal will be

considered the final Corps jurisdictional determination, unless the

appellant submits an RFA to the Division RO as described below.

C. Second Level Appeal--Division Office

The Division Engineer, or designee, is responsible for the review

of and decision on the second level appeal of jurisdictional

determinations. The Division Engineer may retain or delegate either or

both, the RO responsibilities and the appeals decision to the same or

different Corps officials.

We expect that normally the ROs in the Division Office would be the

same ROs that conduct the administrative appeal or permit denials which

is described in more detail later. While these Division ROs would

normally be a regulatory expert or have the support of a regulatory

expert, they may have limited jurisdictional determination expertise.

Depending on the jurisdiction issue raised and the expertise of the

Division RO, the Division RO will obtain the assistance of experts from

a District Office other than the District Office where the appeal was

initiated.

The appellant may appeal the formal jurisdiction decision resulting

from the first level appeal at the District Office by filing an RFA

with the Division Office within 60 days of such final jurisdiction

decision. Within 15 days of receipt of the RFA by the Division Office,

the District Office will forward the administrative record of the

jurisdictional determination to the Division RO. The administrative

record will include any information provided by the appellant during

the first level appeal.

The Division Office review will be limited to the administrative

record prepared during the District Office appeal review. Therefore,

the appellant must submit any relevant information at that time. The

Division Office RO will reach a final decision on the administrative

appeal within 60 days of receipt of the RFA.

In completing the evaluation process, the Division RO will either:

(1) Determine that the appeal has no merit; or (2) determine that the

appeal has merit and notify the Corps District regulatory official of

the appropriate course of action to be taken. The Corps jurisdictional

determination resulting from the second level appeal will be considered

the final Corps jurisdictional determination.

D. Costs

Because of the variable scope of wetlands among Corps districts and

developmental pressures on those wetlands, limited data is available to

assess the potential cost of the administrative appeal program for

wetland delineations and jurisdictional determinations. However,

assuming that 10% of the approximately 35,000 jurisdictional

determinations conducted annually by Corps Districts are appealed, and

that the average costs associated with each appeal is $1200-1500

(Salary/travel/data collection), the annual cost of the program could

range from $4.2-$5.25 million.

IV. Administrative Appeal of Permit Denials

The proposed rule provides permit applicants with an opportunity to

seek a timely and objective reconsideration of an adverse permit

decision in a non-judicial forum. Only a denial with prejudice of a

Department of the Army permit application, or the applicant's rejection

of a proffered permit containing special conditions that are

unacceptable to an applicant and subsequently denied by the District

Engineer, would be subject to the administrative appeal process. A

denial with prejudice occurs when the permit is denied based upon the

project's failing to meet public interest criteria and/or guidelines

specified in Corps regulations (33 CFR Parts 320 through 330) and EPA

regulation (40 CFR Part 230). Conversely, a denial without prejudice

would not be subject to an administrative appeal, because such a denial

is a pro forma action based on the applicant's failure to obtain

requisite approval from another regulatory entity, and is not a Corps

decision made on the merits of a completed public interest review and

Section 404(b)(1) analysis. Further, if the applicant endorses and

accepts a permit that is modified, conditional, and/or mitigated, the

permit is not subject to an administrative appeal.

Additionally, the Corps of Engineers, through a separate rule-

making proposal, will be proposing to make permit decisions within 90

days from the date of public notice for a proposed project, except for

limited situations which preclude the Corps from making a decision due

to other regulatory or legal requirements. As part of this rule-making

proposal, we are seeking comments on whether the failure of the Corps

to reach a permit decision within established deadlines should be

viewed as a permit denial and subject to an administrative appeal.

The intent of this administrative appeal process is to provide a

venue wherein the appellant will have an opportunity to have an

independent evaluation conducted of the Corps' denial of a permit,

including a proffered permit containing special conditions unacceptable

to the applicant which is subsequently denied by the District Engineer.

Several options were considered for the identity of the permit

denial Review Officer (RO) and the appeals decision-maker. An analysis

of the options resulted in a determination that the Division Office

could best meet the goals of providing an objective forum, ensuring the

availability of well-qualified ROs, achieving an acceptable level of

cost-effectiveness, promoting administrative efficiency, and providing

the greatest access and convenience to appellants.

The need to ensure an impartial and objective review was considered

to be the most important factor in implementing a valid administrative

appeals process for permit denials. We believe this goal is attained by

placing the review function at the Division level with the Division

Engineer making the appeal decision rather than within Corps Districts.

The Division RO would exercise a delegated authority to act on behalf

of the Division Engineer, in conducting the administrative appeals

process. The Division Engineer would make the decision on the merits of

the appeal and direct the District Engineer to implement administrative

appeal remedies or proceed with the permit denial. It is anticipated

that Division RO candidates will likely be drawn from present Corps

staff at HQ, Divisions, and Districts, and that they will represent the

best trained and most experienced regulatory experts available.

[[Page 37284]]

The essence of the appeals process is an independent analysis of

the existing administrative record to ensure that the district's

decision complies with legal, regulatory, and policy requirements, that

omissions of material facts have not occurred, and that the record is

sufficient to support conclusions of the permit decision that was made.

The process provides for a review conference at which Corps personnel

and the applicant, authorized agent, and/or consultant may meet with

the Division RO to provide clarification of information in the

administrative record. The record may not, however, be supplemented by

new data since this would constitute an amended application that may

initiate a new public interest review rather than an appeal of the

existing record and decision. Further, in reviewing technical issues,

Division Engineers will not substitute their judgment for that of the

District Engineers unless the issue falls within the ``clearly

erroneous or omission of material fact'' category.

Under the proposed rule concerning permit denials, the Division

Engineer's determination will not constitute a final agency decision;

but would conclude with a finding that would be sent to the District

Engineer whose decision was being appealed. This finding would either:

(1) Determine that the appeal has no merit; or (2) determine that the

appeal has merit and notify the District Engineer of further analysis

and evaluation needed before the District Engineer can make the final

agency decision on the permit application.

The re-opening of the public interest review and 404(b)(1)

Guidelines analysis may be a limited review, if the noted deficiencies

are narrow in scope and impact. The supplemental review process will

include notice to all parties who commented on or participated in the

original review. However, if the noted deficiencies are substantial in

scope and impact, the issuance of a new public notice, opportunity to

request a public hearing, and preparation of a supplemental

environmental analysis and decision document may be required (see 33

CFR 325.7). This would allow new interested parties an opportunity to

offer their views for the District Engineer's reconsideration of the

permit application.

Upon conclusion of the re-evaluation, if the District Engineer

determines that the proposed action is contrary to the public interest

and/or 404(b)(1) Guidelines, the original denial will be reaffirmed and

the decision will not be subject to further administrative appeal.

Further challenge must be through the judicial process. If the re-

evaluation results in a determination that a permit should be issued,

that decision will be based on a supplemental administrative record and

with the benefit of additional input from all interested parties.

Furthermore, the determination to issue a permit may be subject to the

404(q) elevation process, but is not open to further administrative

appeals.

Additionally, as discussed above, an appeal could be initiated for

a decision to issue a permit with special condition(s) that the

applicant finds unacceptable, and thus refuses to accept the permit.

However, if the administrative appeal of a permit decision was sought

by an applicant because of special conditions the applicant considered

unacceptable, the applicant is appealing the permit decision, not just

the special condition(s) of the proffered permit. The District

Engineer, when evaluating the permit decision for a proffered permit

that was not accepted by an applicant, will decide, upon further

evaluation, either to: (1) Reaffirm the decision to deny the permit; or

(2) issue the permit with special condition(s) different from those in

the original proffered decision. Appellants must be aware, therefore,

that the rejection of a proffered permit would not result in a simple

``yes'' or ``no'' on the merits of a special condition(s). Rather, the

entire decision making process is opened for consideration of public

interest review criteria and 404(b)(1) Guidelines analysis by the DE in

reaching a final permit decision. Furthermore, a decision that has

undergone a reevaluation as directed by the Division Engineer can not

be further administratively appealed.

Based on past regulatory program experience, it is reasonable to

estimate that annually 250 permit denials may be appealed under the

proposed rule. To accommodate this increased work effort, it would be

necessary to establish one to two RO positions in each of the ten Corps

Divisions to implement the administrative appeals process. It is

estimated that the resulting annual expense would be $2.5 million.

These costs include:

20 ROs..................................................... $1,840,000

RO's travel & per diem/per appeal ($750 x 250)............. 187,500

Additional travel & per diem for Corps staff ($400 x 250).. 100,000

supplemental Public Notice and Additional District Office

Review of Appeals (250 cases at $1,500)................... 375,000

------------

Total.................................................. 2,502,500

V. Third Party Appeals

An ideal administrative appeal regulation for some people would be

one that allows all third parties to request an administrative appeal

of jurisdictional determinations and permit decisions. We understand

this position. However, such a program would be much more expensive and

require many more people to administer than that contemplated in this

proposal. Congress is considering appropriating a small budget increase

to allow the Corps to implement the proposed administrative appeal

process. It appears unlikely that Congress would fund the costs of an

expanded administrative appeals process, the benefits of which we do

not believe would justify the costs. While this regulation would not

allow third party appeals, it does provide for third party input in

permit denial cases where the District Engineer is reconsidering the

permit denial, as discussed below.

Under the proposed rule, the applicant or the landowner, is the

only individual who may initiate an appeal of a formal jurisdictional

determination. In proposing this rule the Corps recognizes that there

may be other parties having an interest in a jurisdictional

determination. However, these interests are not the primary property

interests. Third party appeals related to such secondary property

interests could raise a number of property rights issues. Third party

involvement would reduce the efficiency of the process since third

parties are not likely to readily obtain the permission of landowners

to enter onto the property to conduct the technical, on-site surveys

that are critical to validate jurisdictional determinations, including

wetland delineations. Further, if the Corps determines that an area is

a geographic area subject to Corps regulatory authority, substantial

development proposals would likely trigger permit requirements and

provide third parties with an opportunity to participate through the

public interest review process.

Under the proposed rule, the applicant is the only individual who

may initiate an appeal of a permit decision. However, full

participation by third parties is provided for in the appeal process if

the Division Engineer's determination is to refer the file back to the

District Engineer for re-evaluation. It was determined that it was not

necessary to provide for third party participation in the RO's permit

review conference, since third parties had an ample opportunity to

provide comments

[[Page 37285]]

or concerns and submit substantive evidence during the public notice

phase of the permit evaluation process and again to provide comments if

the District Engineer is reconsidering the application because the

Division Engineer determines that the appeal had merit. Further, the

President's plan did not contemplate nor recommend the administrative

appeal of permit issuances. These decisions are considered valid

reflections of the public interest since they have already undergone

rigorous review, with input from numerous agencies and the general

public, and these decisions may be elevated by some Federal agencies

pursuant to Section 404(q) Memorandum of Agreement. Expanding the

appeal process to permit issuance decisions would also significantly

expand the potential number of appeals since the Corps annually issues

approximately 10,000 standard permits nationwide. Opening these

decisions to administrative challenge would have severe adverse effects

on the overall efficiency and cost of the regulatory program.

Furthermore, judicial review is available to affected third parties.

VI. Unauthorized Activities

As a general rule, jurisdictional determinations made in the

context of an enforcement case can not be administratively appealed

under this rule. We are concerned that the public interest in

expeditious and efficient resolution of an enforcement action should

not ordinarily be delayed by administrative appeals of jurisdictional

determinations made for purposes of that enforcement action. However,

the District Engineer, in his or her discretion, is authorized by this

rule to make exceptions to this general rule, and to allow the

administrative appeal of a jurisdiction determination made in the

context of an enforcement action if the District Engineer believes that

the interests of justice, fairness, and administrative efficiency would

be served thereby.

In certain cases involving unauthorized activities, the Corps will

afford the responsible party the opportunity to apply for an after-the-

fact permit. In many instances this approach obviates the need for a

formal enforcement action and expedites the restoration of the affected

wetland. The use of this after-the-fact permit approach can, however,

be affected by statute of limitations complications. Further, engaging

in an Administrative Appeal regarding an activity involving an

enforcement case might raise issues regarding application of Statute of

Limitations with respect to potential enforcement actions.

Consequently, we propose to amend 33 CFR 326.3(e) to include a new

subparagraph (v). This new provision would require those parties

alleged to have engaged in an unauthorized activity to sign a statute

of limitations tolling agreement prior to filing an after-the-fact

permit application. Subsequent to acceptance of an after-the-fact

permit application by the Corps, an applicant may appeal a jurisdiction

determination and/or a denial of an after-the-fact permit. Such tolling

agreement would state that, in exchange for the Corps' considering the

appeal of a jurisdictional determination or the after-the-fact permit

application, or both, the party would agree that the statute of

limitations would be tolled until one year after the final action has

been taken on a jurisdictional determination appeal or the after-the-

fact permit decision has been made (whichever is later), or one year

after any succeeding administrative appeal of an after-the-fact permit

decision has been finalized. Such tolling agreement would also state

that permit applicants will not raise a statute of limitations defense

in any subsequent enforcement action brought by the United States, with

respect to the unauthorized activity for the period of time in which

the statute of limitations is tolled. A party should only be required

to sign one tolling agreement regardless of the number of appeals

sought involving a single unauthorized activity. For example, a party

sings a tolling agreement to appeal a jurisdictional determination,

then applies for and receives an after-the-fact permit decision, and

then appeals the permit decision, the tolling agreement will remain in

effect until one year after the date that the after-the-fact permit

decision has been made final.

Although we are planning to consolidate and propose revisions to

the Corps Regulatory Program Regulations at 33 CFR Parts 320-330,

within the next year, it is important that we make this minor amendment

in conjunction with this proposed rule on administrative appeals to

avoid creating undue confusion among the regulated community. This

confusion would stem from the fact that, even if we were to make the

proposed change to subparagraph (v), we would still have to include a

provision in the administrative appeals regulation requiring that every

applicant who applies for an after-the-fact permit prior to the

effective date of subparagraph (v), sign a tolling agreement prior to

filing an administrative appeal. This provision is necessary to address

those parties that apply for after-the-fact permits between now and the

effective date of subparagraph (v). If we were to wait until we revise

33 CFR Parts 320-330 to propose subparagraph (v), then this group of

after-the-fact permit applicants would only increase in number, further

contributing to the confusion that this provision could create.

VII. Exhaustion of Administrative Remedies

In Darby v. Cisneros, 113 S.Ct. 2539 (1993), the Supreme Court

recently held that persons subject to Federal agency regulation need

not exhaust administrative remedies before filing a lawsuit in Federal

District Court, unless a statutory or regulatory provision requires

such exhaustion. In response to Darby v. Cisneros, the Corps is

including Sec. 331.12 in this proposed rule to make it explicit that

persons dissatisfied with jurisdictional determinations or permit

decisions must avail themselves of the administrative appeals

process(es) proposed in this rule and received a final agency decision

prior to seeking redress in the Federal courts.

VIII. Application of Rule to Prior Regulatory Decisions

We are proposing that when the final administrative appeals process

is adopted that certain actions completed prior to the effective date

of the final regulation be allowed to be appealed in accordance with

this regulation. We believe that it would be appropriate to accept

administrative appeals of final jurisdictional determinations and

permit denials, that were transmitted in writing to an affected party

one year prior to the effective date of the final regulation, if the

affected party submits a request for appeal (RFA) to the Corps within

60 days of the effective date of the final rule.

It should be noted by potential appellants of prior regulatory

decisions that the criteria for appeal must be met, or the request for

appeal will be rejected by the Corps. Additionally, if large numbers of

RFAs are received under this provision, an RO may delay the initiation

of processing an RFA for up to 6 months after the implementation date

of these regulations, if necessary.

IX. Environmental Documentation

We have made a preliminary determination that this action does not

constitute a major Federal action significantly affecting the quality

of the human environment, because the Corps prepares appropriate

environmental documentation, including an Environmental Impact

Statement (EIS)

[[Page 37286]]

when required, for all permit decisions. Furthermore, wetland

delineations and jurisdictional determinations do not result in an

applicant or landowner being able to conduct work in waters of the

United States without a required permit authorization, but only

describe and determine the scope and extent of waters of the United

States under Corps regulatory jurisdiction based on technical criteria

that is established separately. Therefore, environmental documentation

under the National Environmental Policy Act (NEPA) is not required for

those actions. Moreover, this proposed regulation for administrative

appeals only adds an optional one-level review to permit denials, to

insure that applicable regulations, policies, practices, and procedures

(including the preparation of appropriate environmental documentation)

have been appropriately followed.

X. Executive Order 12291 and the Regulatory Flexibility Act

The Corps does not believe that this proposed regulation meets the

definition of a major rule under Executive Order 12291, and we

therefore do not believe a regulatory impact analysis is required. This

proposed rule should reduce the burden on the public by offering an

administrative appeal process for certain Corps decisions, and in many

instances, should avoid the more time consuming and costly alternative

of appealing a decision under judicial review.

We also do not believe that this proposed regulation will have a

significant impact on a substantial number of small entities pursuant

to Section 605(b) of the Regulatory Flexibility Act of 1980, because

this proposed regulation only creates an optional review of certain

decisions through an administrative appeal process. The proposed rule

should be less time consuming and less costly to permit applicants who

want to appeal a decision with which they disagree, but currently can

only seek an appeal through the judicial system. Furthermore, since the

administrative appeal would be optional at the applicant's or

landowner's discretion, we have minimized the potential of any

increased regulatory burden on small entities. If an applicant or

landowner chooses to forego an appeal, the net effect of the proposed

regulation would be zero.

Note 1.--The term ``he'' and its derivatives used in these

regulations are generic and should be considered as applying to both

male and female.

List of Subjects

33 CFR Part 320

Environmental protection, Intergovernmental relations, Navigation,

Water pollution control, Waterways.

33 CFR Part 326

Investigations, Intergovernmental relations, Law enforcement,

Navigation, Water pollution control, Waterways.

33 CFR Part 331

Administrative appeal, Navigation, Waterways, Environmental

protection, Water pollution control.

John H. Zirschky,

Acting Assistant Secretary of the Army (Civil Works), Department of the

Army.

Accordingly, 33 CFR Parts 320 and 326 are proposed to be amended

and 33 CFR Part 331 is proposed to be added as follows:

PART 320--GENERAL REGULATORY POLICIES

1. The authority citation for Part 320 continues to read as

follows:

Authority: 33 U.S.C. 401 et seq.; 33 U.S.C. 1344; 33 U.S.C.

1413.

2. Section 320.1(a)(2) is amended by revising the final sentence to

read as set forth below.

Sec. 320.1 Purpose and scope.

* * * * *

(a)(2) * * * A district engineer decision to deny a permit or a

Corps jurisdictional determination is subject to an administrative

appeal by the landowner or permit applicant in accordance with the

procedures and authorities contained in 33 CFR Part 331. Such

administrative appeal must meet the criteria in 33 CFR 331.5; otherwise

there is no administrative appeal of that decision. An applicant or

landowner must exhaust any administrative appeal available pursuant to

the 33 CFR Part 331 and receive a final agency decision prior to filing

suit in Federal District Court.

PART 326--ENFORCEMENT

1. The authority citation for Part 326 continues to read as

follows:

Authority: 33 U.S.C. 401 et seq.; 33 U.S.C. 1344; 33 U.S.C.

1413.

2. Section 326.3(e) is amended by adding a new paragraph (e)(1)(v)

to read as follows:

Sec. 326.3 Unauthorized activities.

* * * * *

(e) * * *

(1) * * *

(v) No permit application will be accepted unless and until the

applicant has furnished a signed statute of limitations tolling

agreement to the district engineer. A single statute of limitations

tolling agreement will be prepared for each unauthorized activity. Such

agreement will state that in exchange for the Corps' acceptance of any

after-the-fact permit application and/or any administrative appeal

associated with the unauthorized activity, the responsible party agrees

that the statute of limitations will be tolled until one year after the

final after-the-fact permit decision or, if there is an administrative

appeal, one year after the final agency decision as defined at 33 CFR

331.9, which ever is later.

Part 331 is added to read as follows:

PART 331--ADMINISTRATIVE APPEALS PROCESS

Sec.

331.1 Purpose and policy.

331.2 Definitions.

331.3 Review officers.

331.4 Notification of appealable actions.

331.5 Criteria.

331.6 Filing appeals.

331.7 Review procedures.

331.8 Timeframes for appeals decisions.

331.9 Final appeals decisions.

331.10 Final agency decisions.

331.11 Unauthorized activities.

331.12 Exhaustion of administrative remedies.

Authority: 33 U.S.C. 401 et seq., 1344, and 1413.

Sec. 331.1 Purpose and policy.

(a) General. The purpose of this regulation is to establish

administrative appeals policies and procedures for final Corps of

Engineers geographic jurisdictional determinations and permit denials

with prejudice. The appeals process will allow landowners and permit

applicants to pursue an administrative appeal of a final Corps of

Engineers decision or determination with which they disagree. The basis

for an appeal and the specific policies and procedures of the appeals

process are described in the following sections. It shall be the policy

of the Corps of Engineers to promote and maintain an administrative

appeals process that is independent and objective, fair and equitable,

and efficient and cost-effective.

(b) Jurisdictional determinations. Under the Corps of Engineers

regulatory program, landowners and permit applicants may request, and/

or receive, final Corps jurisdictional determinations to determine the

presence and extent of wetlands, scope and extent of other waters of

the United States, and whether the property or

[[Page 37287]]

waterbody is subject to Department of the Army jurisdiction. Therefore,

such geographic jurisdictional determinations are vitally important

decisions to landowners and permit applicants. These decisions affect

whether or not the Corps has regulatory jurisdiction, and whether a

permit is required for work involving regulated discharges and

activities. The administrative appeal process shall apply to these

decisions.

(c) Permit denials. Permit decisions that result in denial with

prejudice may be appealed under the administrative appeal process.

Sec. 331.2 Definitions.

The terms and definitions found in 33 CFR Parts 320 through 330 are

applicable to this regulation. In addition, the following terms are

defined for the purposes of this Part:

(a) Jurisdictional determination means a written Corps

determination that a wetland (as determined and defined by a wetland

delineation) and/or waterbody is subject to regulatory jurisdiction

under section 404 of the Clean Water Act or a written Corps

determination that a waterbody is subject to regulatory jurisdiction

under sections 9 and 10 of the Rivers and Harbors Act of 1899.

Additionally, the term includes a written reverification of expired

jurisdictional determinations and a written reverification of

jurisdictional determinations where new information has become

available that may affect the previous written determination. For

example, such geographic jurisdictional determinations may include, but

are not limited to, one or more of the following determinations:

presence/absence of wetlands, wetland/upland boundary, ordinary high

water mark, mean high water mark, high tide line, interstate commerce

nexus for isolated waters, and adjacency of wetlands to a waterbody.

All jurisdictional determinations will be in writing and will be

identified as either preliminary or final jurisdictional

determinations. Some office, or preliminary, jurisdictional

determinations are provided to applicants or landowners, generally to

indicate the presence or absence of wetlands or waterbodies. They are

advisory in nature and may not be appealed. Final jurisdictional

determinations will be provided in writing and will be certified as a

final jurisdictional determination and may be appealed.

(b) Wetland delineation means a Corps of Engineers (Corps)

delineation, or verification of a delineation submitted by an applicant

or consultant, indicating the size and boundaries of a subject property

that is a wetland in accordance with the current Federal manual for

identifying and delineating wetlands (FDM). Additionally, the term

includes reverification of expired wetland delineations and

reverification of wetland delineations where new information has become

available that may affect the final delineation.

(c) Permit denial means a written Corps denial with prejudice (see

33 CFR 320.4(j)) of an individual standard permit as defined in 33 CFR

325.5(b). Permit denials also include cases where a proffered

individual permit is refused by the applicant in writing because the

applicant objects to the terms or special conditions of the proffered

permit and the permit is subsequently denied with prejudice by the

District Engineer. If the applicant refuses a proffered general permit,

the District Engineer will not deny a permit for the proposed project

based on that refusal. The applicant must apply for an individual

permit. If that individual permit is subsequently denied with

prejudice, then the applicant may request an appeal of that denial.

(d) Appealable action means a written final jurisdictional

determination or permit denial as those terms are defined in paragraphs

(a) and (c) of this section.

(e) Affected party means a permit applicant or landowner (i.e., an

individual who has an identifiable and substantial legal interest in

the property) that has received a final jurisdictional determination,

or permit denial as those terms are defined in paragraphs (a) and (c)

of this section.

(f) Appellant means an affected party who has filed an appeal under

the criteria and procedures of these regulations.

(g) Review officer (RO) means the Corps of Engineers agency

official responsible for the review and final decision on the merits of

an appeal or review and recommendation to the Corps agency official

making the final decision on the merits of an appeal. The RO, and/or

the appeals decision-maker, is the District Engineer, or the Division

Engineer as appropriate, or their designee(s).

(h) Notification of appeals process (NAP) means the information

fact sheet which explains the administrative appeals process, criteria,

and procedures. The NAP will accompany all final wetland delineations,

jurisdictional determinations, and permit denials, as these terms are

defined herein.

(i) Request for appeal (RFA) means the affected party's official

request to appeal an appealable action with which he disagrees. The RFA

will include required information to identify the affected party,

proposed project, reason(s) for the appeal, and any supporting data and

information. The format and required information of the RFA will be

provided to the affected party at the time of notification of appeals

process. The affected party initiates the administrative appeals

process by completing and returning the RFA to the appropriate Corps of

Engineers office.

Sec. 331.3 Review officers.

(a) Authority. The District Engineer, or the Division Engineer as

appropriate, has the authority and responsibility for administering a

fair, reasonable, and effective administrative appeal process. The

District Engineer, or the Division Engineer as appropriate, may act as

the RO or may delegate, either generically or on a case-by-case basis,

any authority or responsibility described in this Part as that of the

RO. However, the District Engineer, or the Division Engineer as

appropriate, may not delegate any authority or responsibility described

in this Part as that of the District Engineer, or the Division

Engineer, respectively. Regardless of any delegation of RO authority or

responsibility, the District Engineer or the Division Engineer as

appropriate, retains overall responsibility for the administrative

appeal process.

(1) Jurisdiction determinations. The District and Division ROs have

the authority to make a decision on the merits of the appeal.

Furthermore, the District RO has the discretion to make a new

jurisdiction determination.

(2) Permits denials. The RO will prepare an analysis and

recommendation for the Division Engineer. The Division Engineer has the

authority to make the final decision on the merits of the appeal. Under

the appeal process, neither the RO nor the Division Engineer has the

authority to make a final decision to issue or deny any particular

permit. The authority to issue or deny permits remains with the

District Engineer. However, the Division Engineer may exercise the

authority at Sec. 325.8(c) to elevate the permit case and then may make

the final permit decision.

(b) General. (1) Independence. The ROs shall be located in the

Corps Division and District regulatory offices, unless specifically

appointed as described in paragraphs (b), (c) and (d) of this section.

The ROs will not perform or have been involved with the preparation,

review, or decision making of the action being appealed. During the

appeal process, the ROs shall maintain independence and objectivity in

their

[[Page 37288]]

review of an appeal case and when determining the merits of the appeal.

(2) Review. The RO will conduct an independent analysis of the

existing administrative record to ensure that the district's decision

complies with legal, regulatory, and policy requirements, that

omissions of material facts have not occurred, and that the record is

sufficient to support conclusions and the ultimate decision. The

District RO has the discretion to gather additional information when

deemed necessary. When reviewing technical issues, Division RO's shall

not substitute their judgment for that of the Corps district unless the

reviewed decision was clearly erroneous or omitted a material fact. An

RO who lacks specific expertise with regard to a specific appealed

issue will obtain the assistance of another RO or other recognized

expert from an office outside the Regulatory Branch or from a District

other than the District where the appeal was initiated.

(c) Jurisdictional determinations. (1) District RO. The Corps

district RO shall be, or have the support of, a recognized expert with

extensive experience in conducting and reviewing wetland delineations

and performing and reviewing jurisdictional determinations. The

district RO shall report directly to the Regulatory Branch Chief. This

arrangement will insure that the district RO is removed from day-to-day

involvement in routine jurisdictional determinations made by Regulatory

Branch project managers, unit chiefs, and section chiefs. For any case

where the jurisdictional determination was made by the Regulatory

Branch Chief or higher authority, or the individual(s) who normally

acts as the district RO has participated in the decision or otherwise

advised the decision-maker, or at the District Engineer's discretion,

the District Engineer or a Corps official at least one level higher

than the decision-maker shall appoint a qualified independent RO to

conduct the appeal process.

(2) Division RO. The division RO responsible for appeals of a

district RO's decision shall generally be the same RO(s) that is

responsible for appeals of permit denials described in paragraph (d) of

the section.

(d) Permit denials. The ROs responsible for appeals involving

permit denials shall be officials in Division regulatory offices with

extensive knowledge of all aspects of the Corps regulatory program. For

any case where the permit decision was made by the Division Engineer or

higher authority, an agency official at least one level higher than the

decision-maker shall appoint a qualified independent RO to conduct the

appeal process.

Sec. 331.4 Notification of appealable actions.

Every final jurisdictional determination and permit denial must be

provided in writing to the affected party. For permit denials, the

notification will also include a copy of the decision document.

Additionally, an affected party has the right to review and obtain

copies of the administrative record. Each notification letter will

include a NAP and an RFA.

Sec. 331.5 Criteria.

(a) Criteria for appeal. The reason(s) or basis(es) for requesting

the appeal must be specifically stated and must be more than a simple

request for appeal because the affected party did not like the

decision. Examples of reasons or bases for appeals include, but are not

limited to, the following: a procedural error, an incorrect application

of policy or regulations, omission of material fact, incorrect

application of Federal Wetland delineation manual, lack of interstate

commerce nexus, incorrect application of 404(b)(1) Guidelines under the

Clean Water Act, or use of incorrect data.

(b) Actions not appealable. An action or decision is not subject to

an administrative appeal under these regulations if it falls into one

or more of the following categories:

(1) a jurisdictional determination associated with an individual

permit (including an individual permit with special conditions), or the

permit itself, where the permit has been accepted and signed by the

permittee;

(2) any site specific matter that has been the subject of a final

judicial decision; or

(3) a final agency decision that has resulted from additional

analysis and evaluation, as directed by a final appeal decision.

(4) any matter than can not be controlled or changed by the Corps

decision-maker (e.g., The requirement of a binding statute, regulation,

state Section 401 water quality certification, etc.)

Sec. 331.6 Filing appeals.

An affected party must file an RFA that is received by the Corps

within 60 days from the date of the letter notifying the affected party

of the appealable action. In any case where work is authorized to

commence prior to the end of this 60 day period, either by general or

individual permit, and the permittee wishes to request an appeal, the

appeal must be received by the Corps and the appeal process concluded

prior to the commencement of any work in the area identified as waters

of the United States, and prior to any work that could alter the

hydrology of waters of the United States. Additionally, the affected

party must grant a right of entry to the RO to inspect the property and

to conduct appropriate field tests and sampling that the RO determines

may be necessary.

Sec. 331.7 Review procedures.

(a) General. (1) Jurisdiction determinations. The administrative

appeals process for jurisdiction determinations is a two level appeal

process. The first level appeal is to a specialist review officer in a

Corps district office. The landowner will be able to present

information to the RO, or the RO may obtain information, for the

administrative record. The second level appeal is to an RO in a Corps

Division office. This review will be limited to the administrative

record developed during the first level appeal, which would include any

information provided by the landowner as part of that record.

(2) Permit denials. The administrative appeals process for permit

denials is a one level appeal process to the Division Engineer. The

appeals process will be conducted by a RO in the Division office. The

division RO will prepare the record, an analysis, and a recommendation

for the Division Engineer. The Division Engineer may participate in the

appeals process as the Division Engineer deems appropriate. The

Division Engineer will make the decision on the merits of the appeal.

(b) Acceptance of the request for appeal. Within 30 days after

receipt of the RFA, the RO shall review the appellant's RFA and the

administrative record. If, within this 30 day period, the RO determines

that the RFA does not meet the criteria for appeal (see Sec. 331.5),

the RO will notify the appellant in writing by certified mail of this

determination and the reason(s) why the appeal failed to meet

applicable criteria. No further administrative appeal is available,

unless within 30 days from his receipt of the letter refusing his

appeal, the appellant can refute the reason(s) for failing the criteria

for appeal. The appellant may submit a revised RFA, if the reason(s)

for failing applicable criteria have been remedied and the revised RFA

is received by the Corps within 30 days from the date the appellant

received notification that the original RFA failed to meet the criteria

for appeal. If the RO determines that the revised RFA still does not

meet the criteria for appeal, the RO will notify the appellant in

writing of that fact by certified mail within 30 days advising

[[Page 37289]]

the appellant that the matter can not be appealed.

(c) Site visits. If within 30 days from receipt of the RFA the RO

determines that additional field data and sampling are necessary, or if

the appellant requests a site visit, the RO will conduct a site visit.

The RO has the discretion to conduct a site visit, except when the

applicant requests one, in which case a site visit shall be conducted.

The appellant, or the appellant's authorized agent, must participate in

the site visit if he has requested that one be conducted. If a site

visit is conducted, the RO will schedule the completion of the site

visit at the earliest practicable time. When practicable the site visit

should be scheduled in conjunction with the review conference or

meeting, if one is held. Site visits will not be conducted by Division

ROs for appeals of District RO decisions on jurisdiction

determinations.

(d) Meetings and conferences--(1) Jurisdictional determinations

meetings. The District RO may schedule a meeting with the appellant,

his or her authorized agent, or both, and appropriate Corps regulatory

personnel to review and discuss issues directly related to the appeal.

Additionally, the appellant may request that such a review meeting be

held. However, the final decision on whether to conduct a review

meeting shall be at the discretion of the District RO. If a meeting is

held, the appellant will bear his or her own costs associated with

necessary arrangements, exhibits, travel, and representatives. The

Division RO will not conduct any jurisdictional determination meetings

or discussions with any party, including the District RO.

(2) Permit denial conferences. An appeal review conference

(conference) will be held for every permit denial appeal, unless the RO

and the appellant mutually agree to forego a conference. When held, the

conference will take place within 60 days of receipt of an acceptable

RFA, unless the RO determines that unforeseen or unusual circumstances

require scheduling the conference for a later date. The conference will

be governed by the following:

(i) Notification. The RO will set a date, time, and location for

the conference and notify in writing the appellant and the Corps

District regulatory office within 30 days of receipt of the RFA.

(ii) Facilities. The conference will be held at a location that has

suitable facilities and that is reasonably convenient to the appellant,

preferably in the proximity of the project site. Where public

facilities are available at no expense, these facilities are preferred.

If a free facility is not available, the charges for the facility will

be borne by the Corps District regulatory office.

(iii) Participants. The RO, appellant, the appellant's authorized

agent or consultant, and the Corps District staff are authorized

participants in the conference. The Division Engineer and/or the

District Engineer may choose to attend or not to attend at their

discretion. If the appellant does not attend the conference, the

appeals process is terminated with prejudice, unless the RO excuses the

appellant for a justifiable reason. Furthermore, should the process be

terminated with prejudice, the original permit denial decision shall be

sustained.

(iv) The role of the RO. The RO shall be in charge of conducting

the conference. He shall open the conference with a summary of the

policies and procedures for conducting the conference as described in

these regulations. The RO's responsibilities are to conduct a fair and

impartial conference, to hear and fully consider all relevant issues

and facts, and to clarify any matters necessary to make a final

determination on the merits of the appeal.

(v) Appellant rights. The appellant, or the appellant's authorized

agent, will be given a reasonable opportunity to present the

appellant's views regarding the subject permit denial.

(vi) Subject matter. The conference will be limited to matters

contained within the existing administrative record. The RO may ask the

Corps District representatives or the appellant to respond regarding

particular matters of the relevant record, regarding the appellant's

assertions or exhibits, or to clarify elements in the administrative

record. New issues may not be raised or discussed.

(vii) Testimony and transcripts. There will be no sworn testimony

and no cross examination during the conference. The RO may tape-record

and/or have a transcript prepared of the conference. The tape and/or

transcript is for use by the RO to review the proceeding of the

conference and to assist in the preparation of the RO's findings. A

tape-recording or transcript is optional, at the RO's discretion.

However, if none is planned or requested by the RO, the appellant may

contract and bear the expense for such a record if so desired. Any tape

or transcript would become part of the administrative record of the

appeal process and must be made available to all parties upon request.

(viii) Appellant costs. The appellant will bear his own costs

associated with necessary arrangements, exhibits, travel, and

consultants.

(e) The appeal of a District jurisdictional determination to the

Division office will be limited to the administrative record. The RFA

will be accepted upon receipt by the appropriate Division office. The

Division RO will base the appeal decision on the administrative record

provided by the District office. Therefore, the appellant must provide

to the District office all relevant information to be entered into the

administrative record during the District jurisdictional determination

appeal. The Division RO will not meet or have conversations with any

interested party, including the District RO or Corps District

personnel, the appellant or the appellant's agent, regarding this

matter.

Sec. 331.8 Timeframes for final appeals decisions.

The Corps will make a final decision on the merits of the appeal at

the earliest practicable time in accordance with the time limits set

forth in the following paragraphs.

(a) Jurisdictional determination appeals.

(1) District level appeal.

(i) Normal timeframe. If the RFA meets the criteria for appeal and

the District RO determines that a site visit is not necessary, the

District RO, or designated Corps official, will make a final decision

on the merits of the appeal within 60 days from receipt of the RFA, or

the revised RFA, except as provided in paragraphs (a)(1)(ii) and

(a)(1)(iii) of this section.

(ii) Extenuating circumstances. If extenuating circumstances are

present at the site that preclude the appellant and/or the District RO

from conducting the site visit or gathering necessary information, the

District RO may grant a time extension. Examples of extenuating

circumstances may include seasonal hydrology conditions, winter

weather, or disturbed site conditions. However, in no case shall the

data collection or site visit period extend the total appeals review

process beyond twelve months from the date of receipt of the RFA. If a

time extension is granted for information and data gathering, the

District RO will notify the appellant in writing. The District RO will

complete the appeals review and make a final decision within 30 days of

the site visit or data collection time extension period.

(iii) New information. During the course of the appeals review, the

appellant may present new information not available at the time the

appeal was submitted. The District RO, at the

[[Page 37290]]

District RO's discretion, may extend the time period for making the

final decision to 30 days beyond the date of receipt of additional

information submitted by the appellant, unless conditions as described

in paragraph (a)(1)(ii) of this section exist.

(2) Division level appeal. The Division RO, or designated Corps

official, will make a final decision on the merits of the appeal within

60 days of receipt of the RFA.

(b) Permit denials. The Division Engineer will make a final

decision on the merits of the appeal within 90 days of receipt of the

RFA, or the revised RFA.

Sec. 331.9 Final appeals decisions.

(a) In accordance with the authorities contained in Sec. 331.3(b),

the Corps appeal decision will either:

(1) determine that the appeal has no merit;

(2) determine that the appeal has merit; or

(3) for jurisdictional determinations only, at the District level

the RO, or designated Corps official, may determine that the appeal has

merit and revise the jurisdictional determination.

(b) The Corps will document the appeal decision, addressing the

conclusions reached on the merits of the appellant's appeal. If the

Corps determines that the appeal has merit (paragraph (b)(2) above),

the RO will notify the district of further analysis and evaluation

needed before the district can make a final agency decision. The RO

will notify the appellant and the appropriate Corps office of the final

appeal decision on the merits of the appeal in writing. The appellant

will be notified by certified mail.

(c) The final appeal decision of the Division RO, the designated

Corps official, or the Division Engineer, as appropriate, concludes the

administrative appeal process and will be included in the

administrative records. There is no further administrative appeal of

the appealable action.

Sec. 331.10 Final agency decisions.

(a) Jurisdictional Determinations. The final agency decision on a

jurisdictional determination that has been appealed will be made by one

of the following methods:

(1) If the Division RO, or designated Corps official, determines

that the appeal has no merit, then the final agency decision is the

original jurisdiction determination or a District RO, or designated

Corps official, corrected jurisdiction determination, as appropriate;

or

(2) If the Division RO, or designated Corps official, determines

that the appeal has merit, the Division RO, or designated Corps

official, will provide direction to the original decision-maker or the

District RO, as appropriate, to complete the administrative record and/

or further analyze or evaluate specific issues. Subsequently, the final

agency decision is the final jurisdictional determination made pursuant

to the Division RO's, or designated Corps official's appeal decision;

or

(3) If the appellant accepts the agency decision based on the

District RO's, or designated Corps official's appeal decision (see

Sec. 331.9) or does not appeal to the Division Engineer, then that

decision becomes the final agency decision. However, in such cases, the

appellant has acted without exhausting all the administrative remedies

under this rule. (See Sec. 331.12).

(b) Permit denials. The final agency decision on a permit denial

that has been appealed will be made by one of the following methods:

(1) If the Division Engineer determines that the appeal has no

merit, the final agency decision is the District Engineer's denial

decision; or

(2) If the Division Engineer determines that the appeal has merit,

the Division Engineer will provide direction to the District Engineer

to complete the administrative record and/or further analyze or

evaluate specific issues. Subsequently, the final agency decision is

the District Engineer's final decision made pursuant to the Division

Engineer's appeal decision.

Sec. 331.11 Unauthorized activities.

Jurisdictional determinations and permit denials associated with

after-the-fact permit applications are appealable actions for the

purposes of these regulations. If the Corps accepts an after-the-fact

permit application, an administrative appeal of a jurisdictional

determination and/or a permit denial may be filed and processed in

accordance with these regulations subject to the provisions of

paragraphs (a), (b), and (c) of this section. An appeal of

jurisdictional determinations associated with unauthorized activities

will normally not be accepted unless the Corps accepts an after-the-

fact permit application. However, in rare cases, the District Engineer

may accept an appeal of such a jurisdictional determination, if the

District Engineer determines that the interests of justice, fairness,

and administrative efficiency would be served thereby.

(a) Initial corrective measures. If the District Engineer

determines that initial corrective measures are necessary pursuant to

33 CFR 326.3(d), an RFA for an appealable action will not be accepted

by the Corps, until the initial corrective measures have been

completed.

(b) Penalties. If an affected party requests, under this Section,

an administrative appeal of an appealable action prior to the

resolution of the unauthorized activity and the RO determines that the

appeal has no merit, the responsible party remains subject to any

civil, criminal, and administrative penalties as provided by law. Any

penalty imposed, as determined in the appropriate forum by the

appropriate decision-maker, may also include in the calculation of

penalty the time period involving the appeal process.

(c) Tolling of statute of limitations. The RFA associated with

unauthorized activities must include a signed statute of limitations

tolling agreement. (See 33 CFR 326.3(e)(1)(v).) No administrative

appeal will be accepted until such agreement is furnished to the

district engineer.

Sec. 331.12 Exhaustion of administrative remedies.

Applicants or landowners may not file a legal action in Federal

District Court challenging a jurisdiction determination or a permit

denial until after a final agency decision has been made on the permit

application (i.e., permit issuance or denial) and the appellant has

exhausted all applicable administrative remedies under this Part. If an

appellant is challenging a permit denial, the appellant exhausts all

administrative remedies when a final agency decision is made in

accordance with Sec. 331.10(b).

Gregory D. Showalter,

Army Federal Register Liaison Officer.

[FR Doc. 95-17311 Filed 7-18-95; 8:45 am]

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