Climate Whack-a-Mole; or How the Trump Administration Institutionalizes Ignorance in the Endangered Species Act

Posted on August 27, 2019 by Peter Van Tuyn

Given the severity and finality of the extinction of species on this planet, and the myriad adverse impacts on human society and natural ecosystems of such extinction, Congress passed the hallmark Endangered Species Act in 1973.  Since then it has helped save myriad species from extinction and recover many species to healthy population levels.  The success of the ESA in meeting its goals, and strong public support for the law, did not stop the Trump administration from targeting the ESA to ease what it perceives as its negative impact on economic growth. 

As those familiar with the ESA know, a central duty under the law is for federal agencies to consult with the experts within the federal government before undertaking any activity that might jeopardize a species listed under the ESA or adversely modify such a species’ critical habitat.  This consultation helps both to prevent jeopardy and adverse modification and to identify ways in which the activity could proceed without having such effects. 

Among the Trump administration’s controversial proposals was to change the ESA regulations to create a climate change exemption to the ESA’s expert consultation process.  This proposal would have exempted from such consultation any proposed federal action with “effects that are manifested through global processes,” a phrase that is a clear reference to climate change. 

Not surprisingly, this proposal was met with substantial criticism from ESA supporters, who asserted that there was no legal authority to excise climate change from the ESA’s consultation requirements and that to deliberately do so was extremely foolhardy.  These people undoubtedly breathed a sigh of relief when the final rule came out without this proposal, which the Trump administration abandoned “in the interest of efficiency” in the face of that stinging criticism.  

That sigh, however, was certainly followed by a gasp, as those same people found that the final regulations included a wholly new regulatory approach designed to achieve the same effect.  The Trump administration did this by controlling what the expert agencies can consider as they seek to understand the effects of proposed federal action. 

Here is how it works.  First, the final rule defines “effects of the action” as

all consequences to listed species or critical habitat that are caused by the proposed action, including the consequences of other activities that are caused by the proposed action. A consequence is caused by the proposed action if it would not occur but for the proposed action and it is reasonably certain to occur. Effects of the action may occur later in time and may include consequences occurring outside the immediate area involved in the action.

(emphasis here and elsewhere added).  One layer deeper, the final rule defines the newly-added term “consequence,” in relevant part, as follows: 

Considerations for determining that a consequence to the species or critical habitat is not caused by the proposed action include, but are not limited to:  (1) The consequence is so remote in time from the action under consultation that it is not reasonably certain to occur; or (2) The consequence is so geographically remote from the immediate area involved in the action that it is not reasonably certain to occur; or (3) The consequence is only reached through a lengthy causal chain that involves so many steps as to make the consequence not reasonably certain to occur.

The final rule also defines the term “reasonably certain to occur,” which was not defined in the prior rule, to read, in relevant part, as follows:

Factors to consider when evaluating whether activities caused by the proposed action (but not part of the proposed action) or activities reviewed under cumulative effects are reasonably certain to occur include, but are not limited to:  (1) Past experiences with activities that have resulted from actions that are similar in scope, nature, and magnitude to the proposed action; (2) Existing plans for the activity; and (3) Any remaining economic, administrative, and legal requirements necessary for the activity to go forward. 

Finally, the new rule mandates that the criteria set forth in these new definitions of “consequences” and “reasonably certain to occur” “must be considered by the action agency and the [expert agencies].” 

Although the term “climate change” is not used in the text, the intention to preclude the Services from considering climate change is evident.  To begin with, the definition of “consequences” sets forth three criteria and provides that any one of these would support a non-causation finding.  These three factors – remoteness in time, geographic remoteness, and lengthy causal chain – are classic attributes of climate change.  Indeed, climate change is a global phenomenon that has taken decades to develop from multiple sources, through what may be (or perhaps in some cases may not be) complex causal chains.  Furthermore, the definition of “reasonably certain to occur” takes a retrospective stance, emphasizing “past experiences” and “existing plans,” and thus discounts the possibility of new and novel activities resulting from a proposed action in a climate-altered world. 

By providing that the criteria in these two definitions “must be considered,” the new rule makes it clear that it is creating a mandatory duty for the expert agencies to ignore climate-related impacts in their consultations under the ESA.  Indeed, the preamble to the new rule explains that, in situations where the consequences of activities resulting from a proposed action are “remote in time or location, or are only reached following a lengthy causal chain of events,” the consequences of such activities “would not be considered reasonably certain to occur,” thus removing discretion from the experts to determine the likelihood of occurrence. 

So, the Trump administration reacted to the hammering of its proposed attempt to institutionalize the ignorance of climate change impacts on listed species and their habitat with an approach that appears for the first time in the final rule and is effectively the same. This may not be the end of the matter, however, as I suspect the gasps of ESA supporters will turn to anger, and then to action, as they likely head to the courtroom to challenge the final rule.

Trump Track: Speed Bumps on the Road to Species Protection

Posted on August 21, 2019 by Rick Glick

On August 12, 2019, the Trump Administration adopted three new rules in an attempt to rein in the Endangered Species Act (“ESA”).  The rules would undo a rule in place since 1978 affording protections for “threatened” species similar to those listed as “endangered”; limit “critical habitat” designations where species do not now occur; and most controversially, inject economic considerations into the listing process.

The ESA was enacted in 1973 and signed into law by President Nixon.  At that time, environmental protection was not seen as the partisan issue it is today.  The Clean Water Act, Clean Air Act and formation of the EPA all came during Nixon’s watch with near-unanimous support in the Congress.  Speaking on the ESA, Nixon said:  “Nothing is more priceless and more worthy of preservation than the rich array of animal life with which our country has been blessed.”

In enacting the ESA, Congress used uncommonly crisp and unambiguous language.  For example, listing decisions must be “solely on the basis of the best scientific and commercial data available.”  Further, the Act directs federal agencies to “utilize their authorities in furtherance of the purposes of this Act by carrying out programs for the conservation of endangered species and threatened species listed pursuant to section 4 of this Act.” 

The courts have given these words robust interpretations, beginning with TVA v. Hill, which halted the construction of the Tellico Dam to protect endangered snail darters.  Since then scores of ESA cases have protected listed species.  In the Pacific Northwest, these cases often focus on salmon, northern spotted owls and shore birds at the expense of hydropower and the timber industry.

The ESA still enjoys broad public support, but has been on the Republican hit list for decades due to the economic effects associated with species protection.  Of particular note for this Administration, ESA restrictions stand in the way of oil and gas extraction and pipelines.  Yet in an era when the White House and both houses of Congress were all in Republican hands, the Administration was unable to get passed any limitations on ESA jurisdiction. 

The new rules represent the Administration’s shot at reducing the scope of the ESA through policy and rulemaking.  Here is a brief summary of some key elements:

Section 4(d) Rule

Under Section 4(d) of the Act, the fish and wildlife agencies can establish protections or exemptions for certain activities, known as 4(d) rules.  Since 1978 the agencies used a “blanket rule” that treated “threatened” species the same as those designated “endangered. The new rule reverses that default position, and requires a specific 4(d) rule custom made to provide additional protection for threatened species.  This change benefits industry in that the prohibition on “take” of listed species will not automatically apply to threatened species.  Of additional importance is the fact that the new 4(d) rules will take time to develop.  In the interim, presumably development may proceed without fear of prosecution for take of a threatened species.

Critical Habitat

Historically, the agencies have on occasion elected to list as “critical habitat” areas in which listed species do not now occur, but potentially could.  In Weyerhaeuser v. Fish and Wildlife Service, the U.S. Supreme Court suggested that such designations would not be available for areas that needed improvement to be good habitat, and remanded the matter back to the FWS.  The new rules require designation of areas as critical habitat where listed species currently exist before considering unoccupied areas, and then imposes new standards to demonstrate the species will benefit if the designation is extended to unoccupied areas. 

The new rule would also allow the agencies to decline designation of critical habitat if they find doing so “not prudent.”  This includes changes to habitat from climate change.  The rationale is that the government cannot control climate change, so taking steps to protect such habitat would be futile.

Section 7 Consultation

ESA Section 7 requires federal permitting or action agencies to consult with the fish and wildlife agencies about potential “jeopardy” to listed species.  The new rule would affect the “baseline” used for such determinations.  The jeopardy determination will apply only to the new activity; consultation is not required for ongoing activities that the action agencies lack discretion to change.  

Assessment of ongoing activities is particularly relevant to the continuing litigation over the application of the ESA to the Federal Columbia River Power System, a series of hydropower and flood control dams in the Snake and Columbia Rivers.  At the heart of the litigation is whether the existence of four Lower Snake River dams should be presumed, limiting evaluations for jeopardy to modifications to the projects or operations.  The agencies argued that the Corps of Engineers, which operates the dams, have no discretion to modify their purpose and therefore the status quo is the proper baseline.  Courts to date have not found this argument persuasive.

Listing Determinations

Perhaps the most controversial rule change concerns consideration of economic impacts in making a listing or delisting decision.  As noted above, the ESA mandates that listing determinations must be based “solely on the basis of the best scientific and commercial data available.”  The previous rule added for emphasis that the listing must be made “without reference to possible economic or other impacts of such determination.”  The new rule eliminates that language and would allow consideration of economic effects, but like the statute, also specifies that the designation must be based on the best available science.  The Administration has offered no plans on how this analysis will be conducted.  Environmental groups, not surprisingly, see this as a back door means of inserting economics into the decision-making.

Conclusion

There is broad scientific consensus that biodiversity among plants and animals is essential to long-term survival of life on the planet.  Species go extinct or are imperiled every day, often but not always due to human activity.  The ESA was intended address the manmade impacts to wildlife, and indeed there have been stunning successes—the bald eagle, grizzly bear and gray wolf to name a few. 

But the economic dislocations from ESA implementation in many instances have been substantial, often without concomitant species recovery.  Columbia River salmon are still in trouble after billions of dollars spent.  Protection of old growth timber for northern spotted owl habitat led to severe hardships to communities reliant on the forest products industry, only to find that the predation of spotted owls by barred owls could lead to the former’s extinction. 

There is nothing easy, or cheap, about preventing extinction.  It is hubris to suggest government can fix the problem.  But, having created much of the problem, it seems we have to try.  Our effort must extend beyond only saving the “charismatic mega fauna” that dominate media reports, like salmon and polar bears.  Although the public generally supports saving iconic species, support wanes for lesser known species. That is particularly so in rural communities with natural resource-based economies.  Yet these relatively unknown species also play essential roles in the ecosystem. 

The ESA, as well as the other major environmental statutes, is in need of reform to address the unintended consequences of the Act.  That is a task only Congress can perform, but until they do the executive and judicial branches will fill the vacuum.  In the meantime, environmental groups and some states have announced plans to challenge the new rules, which means another several years of litigation and uncertainty. 

That is not a recipe for sound policy, but is what we have until the national consensus on the environment returns.  And no, I’m not holding my breath either.

Old MacDonald Had a Farm [Loan] E-I-E-I-O My

Posted on December 10, 2014 by Charles Nestrud

On December 2, 2014 the United States District Court for the Eastern District of Arkansas enjoined the Small Business Administration (SBA) and the Farm Service Agency (FSA) (together the “Agencies”) from making any payments on their loan guaranties to Farm Credit Services of Western Arkansas (Bank), pending the Agencies’ compliance with the National Environmental Policy Act (NEPA) and the Endangered Species Act (ESA).  The Bank had loaned nearly $5 million to C&H Hog Farms, Inc. (C&H) in 2012 for the construction of a confined animal feeding operation (CAFO), collateralized by a guaranty from the United States. 

The court’s decision paves the way for potential alteration of the collateral agreement terms, over two years after the non-party Bank had closed and funded the loan.  Such court action could jeopardize the farm loan guaranty program.

In its decision the court found that the SBA failed to conduct any environmental review of its loan guaranty or to consider the impact of that loan on the endangered Gray Bat that resides in an area near the CAFO, and that the FSA’s environmental impact and endangered species reviews were inadequate; the Agencies’ actions thereby violated both NEPA and ESA.  The court’s injunction precludes the Agencies from making any payment on their loan guaranties to the Bank until they have complied with their obligations under NEPA and ESA, giving them a year to do so.

In August of 2012, and as provided under state regulation, C&H received a General No Discharge Permit (Permit) from the Arkansas Department of Environmental Quality (ADEQ) that addresses the management of manure, litter, and process wastewater generated from the CAFO.  The Permit authorizes up to 6503 swine, at a location along a creek that discharges to the Buffalo National River, the nation’s first national river.

Upon completion of FSA’s review process and issuance of a Finding of No Significant Impact in August 2012, C&H obtained an initial construction loan of $3.6 million, 75% of which was guaranteed by SBA.  C&H later received a $1.3 million loan, with 90% of that loan guaranteed by FSA.  Both loan guaranties were required by the Bank.  The loans were funded, construction was completed, CAFO operations commenced, and C&H has been making timely loan payments. 

In August of 2013 the Buffalo River Watershed Alliance and several other organizations sued the Agencies, alleging that the CAFO permit contemplated at least occasional discharges of waste into surface waters that could pollute the Buffalo National River, and that the Agencies had violated NEPA, ESA, and certain other federal requirements.  The plaintiffs requested that the loan guaranties be enjoined, pending a further environmental review.  On December 2, 2014 an injunction was issued.  C&H and the Bank were not parties to the litigation.   

The significance of this decision is not the finding of a NEPA or ESA violation.  What is surprising, and noteworthy, is the Court’s conclusion that such agency action was sufficiently related to a loan arrangement between two entities that were not party to the suit, leading to possible rewriting of that loan two or more years after it was negotiated and closed, and the funds dispersed. 

The court concluded there was a sufficient causation nexus because “[w]ithout the guaranties, there would’ve been no loans.  Without the loans, no farm.”  In addition, the Court concluded that requiring further NEPA and ESA review would in fact redress the plaintiffs’ injuries for the loans already made since the Agencies have an “ongoing role in monitoring any conditions placed on their guaranties,” thereby suggesting that further restrictions could well be placed on C&H’s operation of the CAFO.    

The Agencies have now agreed to undertake the additional review within the mandated 12 month time period.   That review may result in no additional restrictions, or in restrictions that C&H can carry out without difficulty.  With C&H being current on its loan payments, this decision may ultimately have no practical impact on C&H or its Bank.  However, the “oh my” scenario is equally possible, because the court’s decision has no limits on the scope of additional restrictions that may be imposed.

As noted by the court, “[t]he federal agencies, through guaranty conditions, have control over C&H’s case-relevant behavior” and “it’s likely that more environmental review will change how C&H operates its farm.”  If C&H is unable to meet those restrictions, resulting in a loan default, the Bank will lack the guaranty it required to fund the loan in the first place.  Thus, the court has authorized the guarantor to re-write the terms if its guaranty, post hoc, to the severe detriment of the non-party Bank.

With a six year statute of limitations on filing a NEPA claim, what farm loan guaranty is safe from being altered or eliminated as a result of judicial action?  Will Old MacDonald be prohibited from obtaining next year’s crop loan until the Agencies complete an EIS, a process that will take a year to complete and likely cause him to miss the planting season? 

And what about other endangered species that could implicate the validity of other farm loan guaranties?  EPA’s proposed habitat designation for two newly listed endangered mussels will encompass over 40% of the area of the state of Arkansas, impacting one third of all property owners in the state, most of which are farmers. 

In addition, the broader implications of this decision on security interests cannot be overlooked.  There were no parties in the litigation to argue that relieving the United States from its debt/collateral obligation would unfairly reward the Agencies for their failure to comply with NEPA and ESA.  The Agencies certainly did not advance that argument.   In fact, the injunction is what the Agencies requested, the court noting that its “Order will follow generally the terms [of the injunction] suggested by [the Agencies].”  The Court even ordered the Agencies to “modify or void the loan guaranties as they deem appropriate in light of their revised and supplemented NEPA and ESA analysis.”  The impact upon the agricultural loan program is clear, since these loans are routinely traded as federally insured securities.  

The Arkansas Farm Bureau has succinctly identified the potential implications of this decision:  “[The opinion] probably just made it a whole lot harder for the next guy who’s trying to get a farm loan, regardless of where they are.”  You can take that to the bank—or not!    

Litigating the “butterfly effect”: Proximate Cause, Imminent Harm and Endangered Whooping Cranes

Posted on August 6, 2014 by Molly Cagle

A recent ruling from the Fifth Circuit involving the endangered whooping crane clarifies the level of proof require to show to establish  proximate cause of  “take” under the federal Endangered Species Act (“ESA”). The case also sets important precedent on the level of imminent harm required to obtain injunctive relief in ESA litigation.

The case, The Arkansas Project v. Shaw, involves the last remaining wild flock of whooping cranes in the world. According to plaintiff, The Aransas Project (“TAP”), the Texas Commission on Environmental Quality (“TCEQ”) water permitting program in 2008-09 caused the deaths of twenty-three endangered cranes (of the approximately 300 remaining in the wild) via the following seven-link chain of causation:

1. TCEQ grants water-rights permits.

2. Water-rights holders divert water

3. Low inflows of water into bays increase bay salinities.

4. Increased salinities diminish available foods for cranes.

5. Diminished food supplies cause cranes to search upland for food.

6. Upland movement of cranes causes them stress.

7. Stress weakens flock and causes crane deaths.

Defendant TCEQ and intervenors, including the Guadalupe-Blanco River Authority and Texas Chemical Council, challenged each causation step during a week-long trial in 2011. In March 2013, the federal district court judge issued a 125-page opinion agreeing with TAP’s theory and adopted TAP’s fact findings verbatim. The district court also ordered the TCEQ to immediately apply for an incidental take permit and submit a habitat conservation plan (as if it were that easy). Additionally, the Court enjoined TCEQ from issuing any new water permits in the Guadalupe and San Antonio River Basins, interjecting itself as the watermaster for all new and modified permits in the basins.  TCEQ and intervenors appealed the order to the Fifth Circuit and successfully stayed the district court injunction. After an expedited briefing schedule, oral argument before the Fifth Circuit took place in the summer of 2013.

On June 30, 2014, the Fifth Circuit per curiam reversed the district court.  The court of appeals held that TAP failed to prove TCEQ proximately caused takes of cranes. The Fifth Circuit is one of the first court of appeals to closely examine the issue of proximate cause and ESA liability since Justice O’Connor penned her concurrence on the subject in the 1995 U.S. Supreme Court opinion Babbit v. Sweet Home. Evoking the famous 1920s Palsgraf v. Long Island Railroad case, the Fifth Circuit compared TAP’s claims to the “butterfly effect” (i.e. the idea that a butterfly flapping its wings in China can affect storm systems in New York).

Importantly, the appeals court called into question the district court’s “simplistic” conclusion that a government entity can cause take simply by authorizing an activity that ultimately affects a species. The court noted that prior instances of governmental regulatory liability for take involved actions that “directly killed or injured species or eliminated their habitat.”

Ultimately, the court examined every link of TAP’s chain of causation and concluded that the district court and TAP simply failed to account for the number of contingencies, e.g. drought, affecting each link.  As the court summed up, “only a fortuitous confluence of adverse factors caused the unexpected 2008–2009 die-off found by the district court. This is the essence of unforeseeability.”

For future ESA litigation, the court’s analysis of the standard required to obtain injunctive relief is as important as its detailed treatment of proximate causation. In particular, the court noted that the district court focused almost exclusively on the injury that occurred in 2008-2009 and could not explain how a steadily increasing flock showed that there was a reasonably certain threat of imminent harm to the cranes. The court held: “Injunctive relief for the indefinite future cannot be predicated on the unique events of one year without proof of their likely, imminent replication.” This is important precedent for future district courts examining injunctive relief even when past take liability can be proven.

TAP petitioned the Fifth Circuit for a rehearing en banc on July 28, 2014 questioning whether an appeals court can rule on proximate cause as a matter of law. So this case may not be over. But if the court’s ruling stands, it will provide fruitful discussion to examine for future ESA litigation. 

Full disclosure: ACOEL Fellow Molly Cagle represented lead intervenor Guadalupe-Blanco River Authority in the Fifth Circuit appeal. She does not attest to any lack of bias in this case and is proud of the fact that the cranes are still doing well, despite unprecedented drought in Texas.