Clark v. U.S. Dept. of Agriculture

• Decision Date: 12 August 2008
• Docket Number: No. 07-3127.,07-3127.
• Citation: 537 F.3d 934
• Parties: Dorothy L. CLARK, Plaintiff-Appellant, v. UNITED STATES DEPARTMENT OF AGRICULTURE; Mike Johanns, Secretary, Defendants-Appellees.
• Court: U.S. Court of Appeals — Eighth Circuit

537 F.3d 934

Dorothy L. CLARK, Plaintiff-Appellant, v. UNITED STATES DEPARTMENT OF AGRICULTURE; Mike Johanns, Secretary, Defendants-Appellees.

No. 07-3127.

United States Court of Appeals, Eighth Circuit.

Submitted: April 15, 2008.

Filed: August 12, 2008.

Thomas A. Lawler, argued, Lawler & Swanson, Parkersburg, IA, for appellant.

Gary L. Hayward, argued, AUSA, Des Moines, IA, for appellees.

Before LOKEN, Chief Judge, JOHN R. GIBSON and MELLOY, Circuit Judges.

MELLOY, Circuit Judge.

Appellant Dorothy L. Clark appeals the district court's¹ refusal to grant a declaratory judgment and set aside a United States Department of Agriculture (USDA) determination that she converted wetlands in violation of the Swampbuster provisions of the Food Security Act of 1985, codified as amended at 16 U.S.C. §§ 3801, 3821-24 (2000). Because the USDA determined she had converted wetlands, Clark became ineligible for certain farm program payments. Clark challenges the USDA's interpretation of the term "converted wetland" and argues the evidence is insufficient to support the USDA's determination that she converted wetlands. In addition, she challenges a USDA regulation that placed the burden on her to request, and prove her eligibility for, a "minimal effect" exemption. Given the deference we owe to the USDA's regulation, its interpretation of the applicable law, and its factual determinations, we affirm the district court's denial of relief.

I. Background

The Swampbuster provisions authorize the USDA to make determinations as to whether certain lands qualify as wetlands and whether wetlands that have been manipulated qualify as converted wetlands. 16 U.S.C. § 3801(a)(6) & (18) (defining "converted wetland" and "wetland," respectively); id. §§ 3821(e), 3822 (authorizing the USDA to make such determinations). To deter the conversion of wetlands, a person determined to have converted wetlands may become ineligible to receive farm program payments. 16 U.S.C. § 3821(c). An exception to the ineligibility provision exists for manipulations determined to have only a minimal effect upon wetland and biological functions. 16 U.S.C. § 3822(f). The case below involved wetlands determinations, converted wetlands determinations, and the minimal effect exemption. The present appeal involves only the converted wetlands determinations and the minimal effect exemption.

Dorothy Clark owns a farm in Boone County, Iowa. She does not actively work her farm, but with the assistance of her son, she makes decisions regarding the farm and leases the farm to a tenant. A creek running through the farm forms a series of oxbows that previously served as pasture ground. In an effort to increase income from the farm, Clark and her son decided to convert the pasture ground for use in row cropping. Neither Clark nor the USDA alleges that the tenant was involved in the decision to manipulate the land or in any subsequent manipulations to the land.

On November 18, 2002, Clark's son sought a wetlands determination from the Natural Resource Conservation Service, an agency within the USDA. After repeated visits, Jared Finley, a district conservationist, determined that eight sites in the area of the oxbows contained a total of five acres of wetlands. In an April 16, 2003 letter, Finley set forth his technical determination and notified Clark she was not to manipulate the wetlands without first contacting the USDA.² In addition, the letter indicated that certain permits might be required from the United States Army Corps of Engineers and from the Iowa Department of Natural Resources, but that any permits should be presented to the USDA and that the USDA could inform her of her compliance options and any available exemptions.³

After receiving the letter, Clark contacted an attorney to seek assistance in obtaining permits from the IDNR and the COE. The attorney eventually advised her that the COE did not claim jurisdiction over the land in question and that the IDNR did not require her to obtain any permits. Notwithstanding the language in Finley's April 16, 2003 letter requesting that Clark contact NRCS prior to manipulating the land, she proceeded to fill and level the wetlands without contacting NRCS.

On December 8, 2004, after receiving several "whistleblower" reports of bulldozing activities on the Clark property, Finley met with Clark's son at the farm. Finley observed that two of the eight sites determined to be wetlands were now filled. In a letter dated December 10, 2004, Finley identified the filled areas and stated, "These areas met the criteria of wetlands which are hydric soils, wetland plants and soil or surface wetness. Your manipulation by filling in on this wetland area is considered an alteration that makes the area more farmable which is a violation of the Swampbuster provisions...." Having received no request for a minimal effect determination nor advance notification regarding the nature of Clark's proposed manipulation of the two wetland sites, Finley conducted no minimal effect investigation and made no minimal effect determination.

When Finley's wetlands and converted wetlands determinations became final, Clark appealed to the County Farm Service Agency Committee and the USDA's National Appeals Division, losing her appeals at each step. She then sought and was denied review from the Director of the National Appeals Division. The Director's denial of relief serves as the final agency action.

Clark then filed this suit in the district court. She sought a declaratory judgment alleging the USDA's action was "arbitrary, capricious, an abuse of discretion or otherwise not in accordance with law; was in excess of statutory jurisdiction, authority, or limitations or short of statutory rights; was without observance of procedure as required by law, and was unsupported by substantial evidence...." She argued specifically that: (1) the USDA followed inadequate procedures when making the wetlands determination, and the evidence did not support the wetlands determination; (2) the USDA misinterpreted the term "converted wetland," the USDA applied an improper standard in making the converted wetlands determination, and the evidence did not support the converted wetlands determination; and (3) the USDA was required, but failed, to conduct a minimal effect determination regarding the manipulation of the two sites. The USDA contested each argument and also argued that Clark failed to adequately exhaust her administrative remedies.

The court determined that Clark had adequately exhausted her administrative remedies. The court then rejected all of Clark's arguments regarding the wetlands determination, the converted wetlands determination, and the minimal effect exemption. On appeal, the government does not renew its argument that Clark failed to exhaust her administrative remedies, and Clark does not renew her arguments regarding the wetlands determination. As such, we need not address these arguments further nor discuss the technical details of the wetlands determination.

Some additional facts are relevant to the issue of the converted wetlands determination. The Swampbuster provisions define a converted wetland as a wetland manipulated "for the purpose or to have the effect of making the production of an agricultural commodity possible if — (i) such production would not have been possible but for such action...." 16 U.S.C. § 3801(a)(6)(A)⁴. Clark relied upon the statutory language "possible" and "not have been possible" and argued that the USDA erred by determining the two wetlands she filled were converted wetlands without first proving the wetlands' pre- and post-manipulation capability to support "the production of an agricultural commodity." Id. In making this argument, Clark urged the court to interpret the word "possible" in a strict manner such that a wetland is not a converted wetland if it is capable of supporting any quantity or quality of agricultural commodity production. She also urged the court to find that the USDA had a duty to prove the wetlands could not support the production of agricultural commodities prior to the manipulation but could support such production after the manipulation. She argued that the USDA merely presented evidence showing that agricultural commodities had not been grown on the two sites, not that agricultural commodities could not have been grown on those sites.

Evidence relevant to the production of agricultural commodities included aerial photographs from 1985 on. These photographs showed no cropping on any of the eight wetlands prior to the bulldozing activity and no cropping on the six unfilled wetlands after the bulldozing activity. The photographs did show cropping on the two filled wetlands after the bulldozing activity. Further, Clark admitted in her filings before the district court that her purpose in manipulating the land was to convert the land from use as a pasture to use for growing agricultural commodities. Finally, Finley testified that he was told someone had attempted to grow agricultural commodities on the two now-filled wetlands at some point in the past, before Clark filled the wetlands. He had no information, however, regarding the success of those efforts.⁵

The district court presented several bases for rejecting Clark's arguments. First, the court rejected Clark's request to apply a strict, literal definition for the statutory term "possible." Instead, the court accepted the USDA's position that a practical interpretation should apply to the statutory term "possible," i.e., manipulations to wetlands that make the wetlands more suitable for farming qualify as the conversion of wetlands. Second, the court rejected Clark's argument that the USDA was required to prove that the wetlands, post-manipulation, could produce agricultural commodities. The court emphasized that the statute prohibits manipulations "for the purpose or to have the effect of making the production of an...