The U.S. District Court for the District of Columbia recently ruled that the EPA violated the Endangered Species Act (ESA) in granting the state of Florida Clean Water Act (CWA) Section 404 permitting authority. The court’s order in the case, Center for Biological Diversity et. al., v. Michael S. Regan et al., vacates the Sunshine State’s authority to oversee building permits for environmentally sensitive areas, including the Florida wetlands.
“After considering these requests and weighing the seriousness of the defects as well as the potential disruptive consequences of vacatur, the Court concludes that the appropriate remedy is to VACATE the EPA’s approval of Florida’s assumption application,” the ruling states.
The implications of the court’s order are complex, and analysts predict permitting chaos in Florida.
ESA explained
The ESA expressly prohibits the unpermitted “take” of an endangered species, defining “take” as any action that may “harass, harm, pursue, hunt, shoot, wound, kill, trap, capture, or collect” a species. Take also includes any actions to modify an endangered species habitat that results in killing or injuring wildlife.
The ESA requires an “action agency” to “review” its actions as soon as possible to determine whether the action will impact endangered species or critical habitats.
“If the action agency determines that an ‘action may affect a listed species or critical habitat,’ the agency must consult with the U.S. Fish and Wildlife Service (FWS) to ensure that its contemplated action ‘is not likely to jeopardize the continued existence of any endangered or threatened species,’” advises Holland & Knight LLP in a Lexology article. “That process – referred to as ‘Section 7 consultation’ – results in the preparation of a Biological Opinion (BiOp), which is used to determine ‘how the agency action [at issue] affects the species or its critical habitat’ and to determine whether the proposed action is likely to jeopardize the continued existence of any listed species. Id. If the agency action will ‘take’ a species, the resulting ‘incidental take statement’ issued with the BiOp ‘specifies the impact of such incidental taking on the species’ and ‘sets forth the terms and conditions … that must be complied with by the [action] agency or applicant (if any), or both,’ to ‘minimize such impact.’
“Typically, a 404-permit issued by the [U.S. Army Corps of Engineers (Corps)] would be subject to the Section 7 process. However, when the 404 program was assumed by the state, there was no longer an ‘action agency’ for the FWS to consult. To overcome this, FWS and EPA undertook a Section 7 consultation on EPA’s approval of Florida’s assumption application. This resulted in the issuance of a ‘programmatic’ BiOp finding no jeopardy, followed by a ‘programmatic’ incidental take statement (ITS) that would protect all future state Section 404 permittees from ESA liability. Specific permits would be subject to ‘technical assistance’ review by FWS. Under this process, FWS is provided the ‘opportunity’ to specify take limits, and the state is required to include those limits, if supplied, in its state-issued permits.”
Background
Section 404 of the CWA authorizes the Corps to issue permits “for the discharge of dredged or fill material” into waters protected by the CWA.
Seven environmental groups, including the Center for Biological Diversity, Defenders of Wildlife, the Sierra Club, the Conservancy of Southwest Florida, the Florida Wildlife Federation, Miami Waterkeeper, and St. Johns Riverkeeper and represented by Earthjustice, sued the EPA in January 2021 in the D.C. District Court, challenging the transfer of federal wetland permitting authority to Florida. The groups warned that the handover from the Trump administration to Florida’s DeSantis administration would “degrade and ruin Florida’s natural landscape, all in violation of federal environmental laws.”
In the lawsuit, the environmental groups claimed the EPA’s “approval of Florida’s application to assume jurisdiction over the CWA permitting program is unlawful because Florida fails to demonstrate adequate authority to carry out the wetlands permitting program, fails to ensure protection of animals and plants under the [ESA], and fails to demonstrate it has sufficient funding and staffing to implement and enforce the program,” states the Earthjustice press release that was issued when the suit was filed. “The state program does not have equivalent permit requirements, enforcement authority, access to courts, public notice, public participation opportunities, and other components that are integral parts of the federal program. The EPA rushed to approve this program so that it may take effect by January 19, 2021, despite these and many other substantial gaps in the state’s proposal.”
The groups also challenged decisions that the FWS and Corps made in connection with the EPA’s review of Florida’s application to assume responsibility for wetlands permitting.
“Specifically, the [FWS] violated the [ESA] by failing to ensure there would be ‘no jeopardy’ to protected animals and plants if Florida took over the program and granting broad protection to developers who ‘incidentally’ harm protected species,” according to the Earthjustice press release. “The [FWS] also created an unlawful scheme for purportedly reviewing the state’s decisions on individual permits that may harm federally protected species. And the [Corps] violated the Administrative Procedure Act and Rivers and Harbors Act with its grossly truncated list of waters that it will continue to oversee.”
Florida was the third state to be granted this permitting authority. Michigan was approved in 1984, and New Jersey received approval in 1994.
In addition to ruling that the agencies had violated the ESA in allowing Florida to assume control over evaluating discharge permit impacts on wetlands, U.S. District Judge Randolph Moss also ruled that the FWS “failed to include the necessary analysis and data to determine whether the EPA’s action in approving Florida’s program would jeopardize species listed under the [ESA],” reports Courthouse News. “The judge also found that another document prepared by the [FWS], known as an incidental take statement (ITS), is unlawful. That’s because the statement failed to quantify the permissible ‘take,’ or harm, of listed species resulting from the agency action, nor did it set a requirement for immediate consultation between the agencies if species are impacted more than expected.”
The judge’s ruling stated that the BiOP and ITS documents issued by the FWS were “legally flawed,” and the EPA “unreasonably relied on those documents in approving Florida’s assumption application. … Given the wealth of information and experience that the FWS has in assessing threats to listed species in Florida, the FWS was at least required to offer some meaningful explanation for why it could not do more.”
Chaos predicted for Florida permitting
Florida received approval to administer the Section 404 permits in December 2020. Since taking over the process, within the first 2 years, the state has approved more than 1,500 permits and denied 145 applications, notes Snell & Wilmer LLP.
In the aftermath of the court’s ruling, those seeking permits for wetlands discharges in Florida will have to use the ESA provisions to receive permit approval.
“The order does not affect permits that were already issued,” Holland & Knight advises. “However, it has significant impacts on pending and future permits. The court held that only a small percentage of state-permits require some form of ESA incidental take protection. But, given that there are 139 listed species in the state and the way that FWS analyzes effects, a larger percentage of permits ‘may affect’ species [more] than the court believes. For example, species such as the panther and bonneted bat have huge designated protection areas. While the court felt that permittees have other ‘options’ such as seeking approval of a Habitat Conservation Plan under Section 10 of the ESA, there is no recognition of the effect of forcing permit applicants to start over with a very different process. The court also seemed unaffected by the chaos that this might cause, noting that it ‘is unaware of any complaints of disruption that were lodged when the EPA transferred Section 404 permitting authority from the Corps to the State.’ Clearly, the court was not a permit applicant in 2021.”
Administrative Procedure Act
The environmental groups’ lawsuit also accuses federal agencies of violating the Administrative Procedure Act and the Rivers and Harbors Act in addition to the stated CWA and ESA violations.
“Moss’s ruling only resolved part of the lawsuit. Issues raised by the plaintiffs concerning other violations of the [CWA] and the Administrative Procedure Act remain before the court,” reports Courthouse News.
This ruling follows recent judicial trends limiting the traditional deference shown to federal agencies.
However, this ruling may seem mild compared with the expected outcomes in two cases that were heard before the U.S. Supreme Court (SCOTUS) in January:
- Loper Bright Enterprises v. Raimondo
- Relentless Inc. v. Department of Commerce
During oral arguments in those cases, Justice Neil Gorsuch stated agency deference “is exploited against the individual and in favor of the government,” Snell & Wilmer says.
“Returning the [CWA] 404 program (and its administrative permitting backlog) to the federal government from the (Florida Department of Environmental Protection) appears to be one more example of that,” Snell & Wilmer adds.
“While no Western States have assumed administration of the Section 404 program, businesses and individuals need to be aware of their administrative and environmental legal rights moving forward, as well as the case law arising out of the [D.C. District Court] — most notably because the Court’s use of the [ESA] has direct results on both 404 permitting interests and, more broadly, how the Administrative Procedures Act will be enforced in the future,” advises Snell & Wilmer. “The impending [SCOTUS] decisions raise these stakes further … businesses and individuals regulated by federal and state agencies” are advised “to determine the scope of their rights and the options they have to ensure their interests are not lost in the ever-circular cycle of the administrative state.”