Building Industry Legal Defense Found. v. Norton, CIV.A. 01-2311(JDB).

• Decision Date: 30 October 2002
• Docket Number: No. CIV.A. 01-2311(JDB).,CIV.A. 01-2311(JDB).
• Citation: 231 F.Supp.2d 100
• Parties: BUILDING INDUSTRY LEGAL DEFENSE FOUNDATION, et al., Plaintiffs, v. Gale NORTON, Secretary of the Interior, et al., Defendants, and Center For Biological Diversity, Inc. and Defenders Of Wildlife, Inc. Intervenors/Defendants.
• Court: U.S. District Court — District of Columbia

231 F.Supp.2d 100

BUILDING INDUSTRY LEGAL DEFENSE FOUNDATION, et al., Plaintiffs, v. Gale NORTON, Secretary of the Interior, et al., Defendants, and Center For Biological Diversity, Inc. and Defenders Of Wildlife, Inc. Intervenors/Defendants.

No. CIV.A. 01-2311(JDB).

United States District Court, District of Columbia.

October 30, 2002.

Robert D. Thornton, Nossaman, Gunther, Knox & Elliot, L.L.P., Irvine, CA.

Matt Kenna, Kenna & Hickcox, P.C., Durango, CO.

Michael P. Senatore, Defenders of Wildlife, Washington.

Kristen Gustafson, United States Department of Justice, Environment and Natural Resources Division, Washington.

MEMORANDUM OPINION

BATES, District Judge.

Plaintiffs bring this case under the Endangered Species Act of 1973 ("ESA"), 16 U.S.C. § 1531, et seq., the Administrative Procedure Act, 5 U.S.C. § 551, et seq., the Regulatory Flexibility Act, 5 U.S.C. § 601, et seq., the Small Business Regulatory Enforcement Act, 5 U.S.C. § 801, et seq., and the National Environmental Policy Act, 42 U.S.C. § 4321, et seq. They challenge the adoption by the United States Fish and Wildlife Service ("FWS") of final rules designating critical habitats for two species. FWS now moves to vacate the final rules and remand the designations for reconsideration in light of a recent decision by the United States Court of Appeals for the Tenth Circuit. For the reasons stated below, the Court will vacate the existing rules and order a remand to FWS. However, the Court will order a shorter time frame for the promulgation of new rules than FWS has requested.

FACTUAL AND PROCEDURAL BACKGROUND

The ESA requires FWS to determine whether a given species should be listed as endangered or threatened based upon the "best scientific and commercial data available." 16 U.S.C. § 1533(b)(1)(A). Concurrent with the listing of the species, FWS may designate a "critical habitat," id. § 1533(a)(3)(A), defined as:

(i) the specific areas within the geographical area occupied by the species ... on which are found those physical or biological features (I) essential to the conservation of the species and (II) which may require special management considerations or protection; and (ii) specific areas outside the geographical area occupied by the species ... upon a determination by the Secretary that such areas are essential for the conservation of the species.

Id. § 1532(5)(A). A critical habitat designation should be made based upon the "best scientific data available and after taking into consideration the economic impact, and any other relevant impact, of specifying any particular area as critical habitat." Id. § 1533(b)(2).

In the early 1990s, FWS listed the Riverside fairy shrimp and the arroyo southwestern toad as endangered species under the ESA. See Determination of Endangered Status for Three Vernal Pool Plants and the Riverside Fairy Shrimp, 58 Fed. Reg. 41,384 (Aug. 3, 1993); Determination of Endangered Status for the Arroyo Southwestern Toad, 59 Fed.Reg. 64,589 (December 16, 1994). On February 7, 2001, FWS issued a final rule designating critical habitat for the arroyo southwestern toad. See Final Designation of Critical Habitat for the Arroyo Toad, 66 Fed.Reg. 9414. On May 30, 2001, FWS did the same with respect to the Riverside fairy shrimp. See Final Designation of Critical Habitat for the Riverside Fairy Shrimp, 66 Fed.Reg. 29,384.

On November 6, 2001, plaintiffs Building Industry Legal Defense Foundation, Foothill/Eastern Transportation Corridor Agency, National Association of Home Builders, California Building Industry Association, and Building Industry Association of San Diego County (collectively, "plaintiffs") brought this action against FWS, the United States Department of the Interior, and the respective heads of those agencies (collectively "defendants") to challenge the critical habitat designations. Plaintiffs allege several errors by FWS in promulgating the final rules, including that FWS used the wrong legal standard in making the designations, that FWS's economic analyses were erroneous and inadequate, and that FWS did not properly balance the benefits and impacts of the designations. On March 13, 2002, this Court granted the motion of Center for Biological Diversity, Inc. and Defenders of Wildlife, Inc. ("intervenors"), two environmental groups, to intervene as defendants.

On April 2, 2002, defendants moved to vacate and remand the critical habitat designations, and, accordingly, dismiss plaintiffs' complaint as moot, in light of the Tenth Circuit's decision in New Mexico Cattle Growers Ass'n v. United States Fish & Wildlife Svc., 248 F.3d 1277 (10th Cir.2001). In that case, the Tenth Circuit reviewed the "baseline" approach used by FWS to analyze the economic impact of critical habitat designation for the southwestern willow flycatcher. Consistent with the baseline approach, FWS had examined only those economic impacts that were solely attributable to the critical habit designation for the species; any economic impacts that were attributable to different causes, such as listing of the species, were not considered. Id. at 1283. Because FWS had determined that the impacts of flycatcher listing were co-extensive with the impacts of designating critical habitat, the agency concluded that no real impact resulted from the critical habitat designation. Id. at 1283-84.

The Tenth Circuit rejected the baseline approach, noting that it rendered FWS's economic analysis "essentially without meaning." Id. at 1285. The proper way to give effect to the congressional intent that economic impacts be considered at the time of critical habitat designation, the court concluded, was for FWS to "conduct a full analysis of all of the economic impacts of a critical habitat designation, regardless of whether those impacts are attributable co-extensively to other causes." Id.

FWS has concluded that the Tenth Circuit's decision in New Mexico Cattle Growers is correct, and thus asks this Court to vacate the critical habitat designations for the arroyo southwestern toad and the Riverside fairy shrimp and remand the matters back to the agency, because the designations, like that in New Mexico Cattle Growers, were based upon a baseline approach. FWS argues, moreover, that it should be given until the spring of 2005 to designate new critical habitats. Plaintiffs, for their part, agree that vacatur and remand are appropriate.

Intervenors, on the other hand, contend that the Tenth Circuit's analysis in New Mexico Cattle Growers was wrong and should not be endorsed by the Court. Although they agree that the economic impact analyses done by FWS are flawed, and that a remand for further consideration of those analyses may be in order, see Intervenors' Response to Mot. to Vacate at 2, they argue that the Court should direct FWS to follow a different methodology for designating critical habitat that would "measure[] the true economic impact (both negative and positive) of the critical habitat designation above and beyond listing," id. at 19 (emphasis added). Citing Sierra Club v. United States Fish & Wildlife Svc., 245 F.3d 434 (5th Cir.2001), intervenors contend that the baseline approach yields a meaningless economic impact analysis only because, employing mis-guided FWS regulatory standards at 50 C.F.R. § 402.02, the protections arising out of critical habitat designation are not significantly greater than the protections afforded by listing a species.¹ If FWS had a proper understanding of the import of critical habitat designation, intervenors contend, the economic impacts of designation would be more significant and would not overlap with those of listing, and thus the congressional directive to conduct an economic impact analysis could be given effect even excluding impacts attributable to listing. Intervenors also argue that vacatur during remand is improper, and that, in the event the rules are vacated, FWS should be allowed only 100 days to review the matters on remand.

ANALYSIS

I. Remand

As the foregoing discussion indicates, the Court is presented with a somewhat unusual set of circumstances. All parties, including the responsible agency, agree that the economic analyses used in designating the critical habitats are substantively defective. However, the parties fundamentally disagree on what methodology FWS should use. Plaintiffs and defendants urge the Court to adopt the Tenth Circuit's approach, and thus to require an assessment that includes all impacts of critical habitat designation — even impacts that are attributable co-extensively to listing and other causes. Intervenors ask the Court instead to conclude that FWS must assess the "true" consequences of critical habitat designation and exclude consideration of impacts attributable to listing. In making this request, intervenors in effect ask the Court to reject an FWS regulation that they contend strips critical habitat designation of its intended significance.

The Court declines to accept either invitation in full. In the limited context of this motion to remand and vacate, the Court's primary task is to determine whether the existing rules require further consideration by the agency. There is no dispute that they do. As all parties recognize, FWS, by declining to consider impacts of critical habitat designation that were co-extensively attributable to other causes and by concluding that the economic impacts of critical habitat designation above and beyond listing were not significant, see 66 Fed. Reg. at 9446-47, 66 Fed.Reg. at 29,400-01, rendered meaningless the congressional charge in 16 U.S.C. § 1533(b)(2) to assess the economic impact of critical habitat designation.

Whether the flaw in FWS's analyses relates to the exclusion of impacts attributable to other causes, as New Mexico Cattle Growers would suggest, or instead to some failure by FWS to appreciate the import of critical habitat designation, as intervenors urge, is a question that is better left for...