The Nickel Report

This week the US District Court for the Northern District of California overturned three Endangered Species Act (ESA) rules issued in 2019 that address: (1) listing species and designating critical habitat, (2) extending take prohibitions to threatened species, and (3) § 7 interagency consultation. Center for Biological Diversity v. Bernhardt, 19-05206 (N.D. Cal. July 5, 2022). The three rules were issued by the US Fish and Wildlife Service and National Marine Fisheries Service (together, the Services) in August 2019 and together represented the first comprehensive revisions to the ESA regulations in 33 years. The order has a number of important regulatory and caselaw implications. 

On December 27, 2021, the US Army Corps of Engineers (Corps) issued a final nationwide permit (NWP) rule  renewing a critical permitting tool for both the government and the regulated community. To comply with the Clean Water Act (CWA or the Act), projects with minimal adverse environmental effects can obtain authorization for the discharge of dredged or fill material into “waters of the United States” (WOTUS) through the Corps’ streamlined NWP process.  With this rule, the Corps reissued 40 existing NWPs and one new NWP.  These 41 NWPs will combine with 16 NWPs issued on January 13, 2021 to authorize use of the full suite of NWPs through March 14, 2026.

As we noted in our July 7 post, consistent with President Biden’s Executive Order 13990, the U.S. Fish and Wildlife Service (FWS) and the National Marine Fisheries Service (NMFS) (collectively, the “Services”) plan an ambitious redo of their Endangered Species Act (ESA) implementing regulations.  Kicking off that process, on October 27, 2021, the Services published two proposals in the Federal Register to rescind critical habitat regulations promulgated by the Trump Administration.  Endangered and Threatened Wildlife and Plants; Regulations for Listing Endangered and Threatened Species and Designating Critical Habitat, 86 Fed. Reg. 59,346 and 86 Fed. Reg. 59,353 (Oct. 27, 2021).  Each of the proposed rules will be subject to a thirty-day public comment period – through November 26, 2021.  The Services may issue final rules by early 2022.

A December 2020 final rule defining “habitat” could have important consequences for future designations of lands and waters as “critical habitat” under the Endangered Species Act (ESA). Designation of critical habitat by the U.S. Fish and Wildlife Service or National Marine Fisheries Service (jointly, the “Services”) can affect projects that require federal agency permits or funding, because ESA section 7 requires federal agencies to ensure through consultation with the Services that their actions are not likely to adversely modify or destroy designated critical habitat.

On December 16, 2020, the Services adopted, for the first time, a regulatory definition of habitat, as follows:

For the purposes of designating critical habitat only, habitat is the abiotic and biotic setting that currently or periodically contains the resources and conditions necessary to support one or more life processes of a species.

Determining which areas constitute habitat for listed species has important consequences under the Endangered Species Act (“ESA” or “Act”), yet “habitat” is not currently defined by the Act or its implementing regulations.  On August 5, 2020, the US Fish and Wildlife Service and the National Marine Fisheries Service (jointly, “the Services”) proposed a rule to define “habitat” for purposes of designating “critical habitat” under section 4 of the Endangered Species Act.  See 85 Fed. Reg. 47,333 (Aug. 5, 2020).  The Services’ proposal responds to the Supreme Court’s November 27, 2018, unanimous holding in Weyerhaeuser Co. v. U.S. Fish & Wildlife Service, 139 S. Ct. 361 (2018), that an area is eligible for designation as critical habitat under the ESA only if the area is actually habitat for that species.  Accordingly, a final rule defining “habitat” would determine which areas of land and water are eligible for designation as critical habitat.  Such designations can affect projects that require federal agency permits or funding, because ESA section 7 consultation requires federal agencies to ensure that their actions are not likely to adversely modify or destroy designated critical habitat.  The result for federally approved or funded projects can be increased permitting costs and risks, and longer timelines.  The proposal’s comment period ended on September 4.  Over 160,000 comments were submitted.  Stakeholders now await a final rule.

Federal environmental reviews are high on the list of project time, costs and risk drivers. National Environmental Policy Act (NEPA) analysis and Endangered Species Act (ESA) Section 7 consultation are often chief among those drivers. The impact of preparing an Environmental Impact Statement or Biological Opinion (such as scheduling; consultant, mitigation and market opportunity costs; and litigation risks) often turns on the scope of analysis, which in turn depends on determining which effects will be caused by the action. In August 2019, the US Fish and Wildlife Service (FWS) and National Marine Fisheries Service (NMFS) established, for the first time, a regulatory causation standard governing ESA section 7 consultations, and, in January 2020, the Council on Environmental Quality (CEQ) proposed a new rule clarifying the causation standard and scope of review under NEPA.

On November 4, 2019, the US Court of Appeals for the Eleventh Circuit upheld the Clean Water Act (CWA) section 404 permit issued by the US Army Corps of Engineers (Corps) for the extension of an existing phosphate mine in central Florida. Center for Biological Diversity v. U.S. Army Corps of Engineers, No. 18-10541 (11th Cir. Nov. 4, 2019). The Corps permit authorizes the discharge of dredged or fill material into waters of the United States that comprise a small portion of the mining extension. Opponents challenged the permit in the Middle District of Florida, claiming the issuance of the permit violated the CWA, the National Environmental Policy Act (NEPA) by not considering “downstream” effects, and the Endangered Species Act (ESA). The district court rejected all of the claims, and the Eleventh Circuit affirmed.

On August 12, 2019, the US Fish and Wildlife Service (USFWS) and the National Marine Fisheries Service (NMFS) (together, the Services) signed final rules instituting the first comprehensive revisions to the Endangered Species Act (ESA) regulations in 33 years. The Services made substantial and broad revisions to their regulations concerning the process and standards for listing species and designating critical habitat, the scope of protections for threatened species and the process for consultation with federal agencies.

The Endangered Species Act increasingly plays a larger role in environmental law and the federal permitting process for infrastructure projects. Hunton Andrews Kurth Partner Kerry McGrath and Associate Brian Levey give an inside look at the complex process of obtaining federal authorization for “take” of endangered species.

Policy makers in California have pledged to resist Trump administration policy changes on environmental and other issues. Senate Bill 1 (SB 1), proposing the California Environmental, Public Health and Workers Defense Act of 2019, is the California legislature’s current preemptive response to the administration’s attempts to modify certain federal environmental and worker safety laws.

SB 1 has passed the California Senate. It is awaiting a final hearing in the State Assembly’s Appropriations Committee, likely sometime in mid‑to‑late August. After that, it moves to the Assembly floor, where a final vote is required by the end of California’s legislative session on September 13, 2019.

On April 16, 2018, the U.S. Fish and Wildlife Service published a final rule removing the black-capped vireo (BCV) from the Federal List of Endangered and Threatened Wildlife. 83 Fed. Reg. 16,228. The BCV is a migratory songbird that breeds and nests in Texas, Oklahoma, and northern Mexico, and winters along Mexico’s Pacific coast. Its breeding habitat includes shrublands and open woodlands. The delisting decision is based on the Service’s determination “that the primary threats to the [BCV] have been reduced or managed to the point that the species has recovered.” The delisting will take effect on May 16, 2018. The Service will work with the States of Texas and Oklahoma to implement a 5-year post-delisting monitoring program in compliance with section 4(g)(1) of the Endangered Species Act (ESA).