Ecological Rights Found. v. Fed. Emergency Mgmt. Agency

• Decision Date: 15 May 2019
• Docket Number: Case No. 17-cv-02788-JD
• Citation: 384 F.Supp.3d 1111
• Parties: ECOLOGICAL RIGHTS FOUNDATION, et al., Plaintiffs, v. FEDERAL EMERGENCY MANAGEMENT AGENCY, Defendant.
• Court: U.S. District Court — Northern District of California

384 F.Supp.3d 1111

ECOLOGICAL RIGHTS FOUNDATION, et al., Plaintiffs,

v.FEDERAL EMERGENCY MANAGEMENT AGENCY, Defendant.

Case No. 17-cv-02788-JD

United States District Court, N.D. California.

Signed May 15, 2019

Jason Robert Flanders, Aqua Terra Aeris Law Group, Oakland, CA, Drevet J. Hunt, Law Office of Drevet Hunt, San Francisco, CA, for Plaintiffs.

Alison C. Finnegan, U.S. Department of Justice, Washington, DC, Rickey Doyle Turner, Jr., U.S. Department of Justice, Denver, CO, for Defendant.

ORDER RE CROSS-MOTIONS FOR SUMMARY JUDGMENT

Re: Dkt. Nos. 28, 29

JAMES DONATO, United States District Judge

Defendant Federal Emergency Management Agency ("FEMA") administers the National Flood Insurance Program ("NFIP"), which provides affordable federal flood insurance to property owners in participating communities. In 2016, FEMA published a biological evaluation to determine whether proposed revisions to NFIP would affect species and habitats protected under the Endangered Species Act, 16 U.S.C. § 1531 et seq. ("ESA"). FEMA declined to consider any ESA effects from construction or other development in floodplain areas, and did not engage in consultations with the Fish and Wildlife Service ("FWS") or the National Marine Fisheries Service ("NMFS").

Plaintiffs Ecological Rights Foundation and Humboldt Baykeeper are conservation organizations that have sued under the ESA's citizen-suit provision to set aside the biological evaluation. 16 U.S.C. § 1540(g) ; Dkt. No. 1. Plaintiffs contend that FEMA was wrong to ignore floodplain development issues and should have consulted with NMFS and FWS about possible jeopardy to listed species and habitats.

The parties have filed cross-motions for summary judgment. Dkt. Nos. 28, 29. The Court finds them suitable for decision without oral argument. Civ. L.R. 7-1(b). Because the record establishes that FEMA acted arbitrarily and capriciously in excluding floodplain development from the ESA evaluation, plaintiffs' motion is granted and FEMA's motion is denied.

BACKGROUND

I. THE ENDANGERED SPECIES ACT

The ESA was enacted to protect and conserve endangered and threatened species and their habitats, and embodies "a conscious decision by Congress to give endangered species priority over the ‘primary missions’ of federal agencies." Ctr. for Biological Diversity v. EPA , 847 F.3d 1075, 1084 (9th Cir. 2017) (quoting Tenn. Valley Auth. v. Hill , 437 U.S. 153, 185, 98 S.Ct. 2279, 57 L.Ed.2d 117 (1978) ). It authorizes the Secretaries of Commerce and the Interior, through their agencies, to list plants and animals for protection, and to designate critical habitats. 16 U.S.C. § 1533. It is undisputed for purposes of these motions that Humboldt, Monterey, and Santa Cruz Counties are home to several listed species and critical habitats in floodplain areas. These species include coastal salmon and steelhead, the northern spotted owl, the marbled murrelet, the California tiger salamander and red-legged frog, Yadon's piperia (a native California orchid), the Humboldt Bay wallflower, and other plants and animals. The habitats comprise some of the most scenic and wild places remaining in California. See , e.g. , Dkt. No. 30 (Beaman Decl.); Dkt. No. 30-1 (Kalt Decl.).

The ESA imposes a variety of procedural and substantive requirements to ensure that the actions of federal agencies do not harm listed species or critical habitats. Nat'l Ass'n of Home Builders v. Defenders of Wildlife , 551 U.S. 644, 652, 127 S.Ct. 2518, 168 L.Ed.2d 467 (2007) ; Ctr. for Biological Diversity , 847 F.3d at 1084 ; Souza v. Cal. Dept. of Transp. , No. 13-cv-4407-JD, 2014 WL 1760346 (N.D. Cal. May 2, 2014). The centerpiece of the ESA is Section 7(a)(2), which provides that each federal agency "shall, in consultation with and with the assistance of the [Services], insure that any action authorized, funded, or carried out by such agency ... is not likely to jeopardize the continued existence of any endangered species or threatened species." 16 U.S.C. § 1536(a)(2). Implementing regulations for Section 7 state that each federal agency must review its actions at the earliest possible time to determine whether they "may affect listed species or critical habitat." 50 C.F.R. § 402.14(a). In sum, these provisions require that a federal agency must consult with the appropriate Service when proposing an action that may affect a listed species or designated habitat. See Karuk Tribe of Cal. v. U.S. Forest Serv. , 681 F.3d 1006, 1027 (9th Cir. 2012) (en banc).

The purpose of the consultations is to "draw on the expertise of ‘wildlife agencies to determine whether [an] action is likely to jeopardize a listed species’ or its habitat, and ‘to identify reasonable and prudent alternatives’ to avoid those harmful impacts." Ctr. for Biological Diversity , 847 F.3d at 1075 (quoting Karuk Tribe , 681 F.3d at 1020 ). NMFS provides consultation on actions involving marine and anadromous species and habitats, and FWS for all other species and habitats.

The gold standard for tapping the expertise of the Services is a "formal" consultation where the action agency engages the pertinent Service to prepare a biological opinion to determine whether the action is likely to jeopardize a listed species or critical habitat. Karuk Tribe , 681 F.3d at 1020. An agency can also hold "informal" consultations with the Services to discuss whether formal consultation is necessary. 50 C.F.R. § 402.13(a). If the agency determines during informal consultation that the action will not adversely affect a listed species or habitat, and the Service concurs, "the consultation process is terminated, and no further action is necessary." Id.

Whether formal or informal, consultation need be pursued only if the proposed action "may affect" a listed species or habitat. If an agency determines on its own "that its action will have ‘no effect’ on a listed species or critical habitat," consultation is not required. Karuk Tribe , 681 F.3d at 1027 (quotation omitted); see also Defenders of Wildlife v. Zinke , 856 F.3d 1248, 1252 (9th Cir. 2017).

II. THE NATIONAL FLOOD INSURANCE PROGRAM

In 1968, Congress established NFIP in the National Flood Insurance Act to provide "appropriate protection against the perils of flood losses and encourag[e] sound land use by minimizing exposure of property to flood losses." 42 U.S.C. § 4001(c). In effect, NFIP strikes a deal with state and local governments. The federal government will make affordable flood insurance available to property owners in risky areas if state and local communities adopt land-use and flood-control measures that incorporate federal guidelines for reducing flood risks and damage.

Congress tasked FEMA with promulgating the criteria to "guide the development of proposed construction away from locations which are threatened by flood hazards" and "otherwise improve the long-range land management and use of flood-prone areas." 42 U.S.C. § 4102(c). To participate in NFIP, local communities must adopt ordinances and regulations that meet or exceed the criteria. 44 C.F.R. § 59.22. If a community implements more stringent flood management measures, it may be eligible under FEMA's Community Rating System ("CRS") for discounted policy premiums. These "incentives" are meant to provide extra encouragement for "floodplain and erosion management" and the adoption of "more effective measures to protect natural and beneficial floodplain functions," among other goals. 42 U.S.C. § 4022(b). If a participating community goes in the opposite direction and falls out of compliance with the criteria, it may be suspended from access to federal flood insurance. 44 C.F.R. § 59.24.

NFIP has become a well-established federal program. More than 22,000 communities participate in NFIP, and over 5.6 million federal flood insurance policies are in effect, providing over $ 1.2 trillion in coverage. FEMA-BE-0027676.¹ The purchase of flood insurance is now required as a condition of receiving a loan from a federally regulated bank for property located in the flood-prone areas of participating communities. 42 U.S.C. § 4012a(b)(1).

FEMA's construction and management criteria are quite detailed. Among many other conditions, participating communities must implement measures "designed to reduce or avoid future flood, mudslide (i.e. mudflow) or flood-related erosion damages." 44 C.F.R. § 59.2(b). All new construction in flood-prone areas must be designed and anchored to prevent flotation, collapse, or lateral movement. Id. § 60.3(a)(3). The criteria specify the siting and design of sanitary and sewage systems, the minimum elevation of new residential construction, the parameters of foundations and basements, and minimum drainage around structures to evacuate floodwaters. See generally id. § 60.3(a)(6), (c)(2)-(c)(6), (c)(11). FEMA also requires participating communities to adopt a "regulatory floodway" designed to prevent surface water from rising "more than one foot at any point" during a flood. Id. § 60.3(d)(2). Levees and floodwalls must meet FEMA specifications before being accredited as providing risk reduction. Id. § 65.10. In addition, unless exempted by FEMA, participating communities must "[p]rohibit encroachments, including fill, new construction, substantial improvements, and other development within the adopted regulatory floodway unless ... the proposed encroachment would not result in any increase in flood levels within the community during the occurrence" of major floods. Id. § 60.3(d)(3)-(4).

FEMA publishes maps that identify flood areas throughout the United States. 42 U.S.C. § 4101(f). The maps demarcate flood zones, which determine whether flood insurance is required for a mortgage and the specific floodplain management criteria a participating community must adopt. FEMA periodically updates the maps to stay current with environmental changes and other factors. Local governments, land owners, and developers can also petition FEMA for a map change. An owner, for example,...