Hillsdale Envtl. Loss Prevention, Inc. v. U.S. Army Corps of Eng'rs

• Decision Date: 28 November 2012
• Docket Number: No. 11–3210.,11–3210.
• Citation: 702 F.3d 1156
• Parties: HILLSDALE ENVIRONMENTAL LOSS PREVENTION, INC.; Kansas Natural Resource Council; Chris Axe; Shelly Axe; Frank Saunders; Natural Resources Defense Council, Inc., Plaintiffs–Appellants, v. UNITED STATES ARMY CORPS OF ENGINEERS; Lieutenant General Robert L. Van Antwerp, in his official capacity; Colonel Roger A. Wilson, Jr., in his official capacity; BNSF Railway Company, Defendants–Appellees. State of Kansas; State of Oklahoma, Amici Curiae.
• Court: U.S. Court of Appeals — Tenth Circuit

702 F.3d 1156

HILLSDALE ENVIRONMENTAL LOSS PREVENTION, INC.; Kansas Natural Resource Council; Chris Axe; Shelly Axe; Frank Saunders; Natural Resources Defense Council, Inc., Plaintiffs–Appellants,

v. UNITED STATES ARMY CORPS OF ENGINEERS; Lieutenant General Robert L. Van Antwerp, in his official capacity; Colonel Roger A. Wilson, Jr., in his official capacity; BNSF Railway Company, Defendants–Appellees.State of Kansas; State of Oklahoma, Amici Curiae.

No. 11–3210.

United States Court of Appeals,Tenth Circuit.

Nov. 28, 2012.

Melissa C. Lin Perrella, Natural Resources Defense Council, Santa Monica, CA, and Mark V. Dugan, Dugan Schlozman LLC, Overland Park, KS, for Appellants.

Douglas R. Dalgleish, Lathrop & Gage LLP, Kansas City, MO (Matthew K. Corbin, Lathrop & Gage LLP, Kansas City, MO, Gus B. Bauman and W. Parker Moore, Beveridge & Diamond, P.C., Washington, District of Columbia, and Kathryn F. Kusske and Jay C. Johnson, Dorsey & Whitney LLP, Washington, District of Columbia, with him on the brief), for Appellee BNSF Railway Company.

Maggie B. Smith, Attorney, United States Department of Justice, Environmental & Natural Resources Division, Washington, District of Columbia, Ignacia S. Moreno, Assistant Attorney General, and T. Monique Peoples and Kristofor R. Swanson, Attorneys, United States Department of Justice, Environmental & Natural Resources Division, Washington, District of Columbia, and Matthew P. Jeppson, Of Counsel, Assistant District Counsel, United States Army Corps of Engineers, Kansas City District, Kansas City, MO, for Federal Appellees.

Derek Schmidt, Attorney General of Kansas, and Jeffrey A. Chanay, Deputy Attorney General, Christopher M. Grunewald, Assistant Attorney General, Office of the Kansas Attorney General, Topeka, KS, on the brief for Amicus Curiae State of Kansas, and E. Scott Pruitt, Attorney General of Oklahoma, Oklahoma City, OK, for Amicus Curiae State of Oklahoma.

Before TYMKOVICH, McKAY, and HOLMES, Circuit Judges.

TYMKOVICH, Circuit Judge.

This case concerns the construction of a new Burlington Northern Santa Fe (BNSF) rail/truck terminal outside Kansas City, Kansas. Because the preferred site contained streams and wetlands protected under federal law, several groups (collectively, Hillsdale) brought challenges to a dredge and fill permit issued by the United States Army Corps of Engineers (Corps) under the Clean Water Act, 33 U.S.C. §§ 1251–1387, and the National Environmental Policy Act, 42 U.S.C. §§ 4321–4370H. The district court denied Hillsdale's motion for an injunction and granted summary judgment for the Corps and BNSF.

On appeal, Hillsdale requests we set aside the Corps's decision to grant the permit because the Corps inadequately considered alternatives to the selected site under the Clean Water Act and violated the National Environmental Policy Act by preparing an inadequate environmental assessment and failing to prepare a full environmental impact statement. We conclude the Corps's decision is supported by the record, and was not an arbitrary and capricious exercise of its approval powers under federal law.

I. Background

In 2007, BNSF applied for a permit from the Corps to dredge and fill waters of the United States (§ 404 permit) as part of its plan to construct a new intermodal facility in the Kansas City area.¹ BNSF operates a transcontinental railroad, the Southern Mainline, that passes through Kansas City. BNSF sought to construct the new intermodal facility near the Southern Mainline because its current Kansas City facility, the Argentine Yard, is inadequate to handle the current volume of freight shipped through Kansas City and lacks space to expand.

BNSF identified a site near Gardner, Kansas as its preferred location for the new intermodal facility. The Gardner site consists of 490 acres of primarily agricultural land, containing 28,000 linear feet of streams and nearly 8 acres of wetlands. Construction of the intermodal facility would affect only a portion of these. The unnamed and seasonally dry streams are tributaries of Big Bull Creek, which flows into Hillsdale Lake, a Corps-operated reservoir. The Gardner site is located roughly one-half mile from a residential subdivision, and two miles from Interstate 35. BNSF anticipates businesses dependent on the intermodal facility will use an adjacent 567 acres to construct a logistics center.

After receiving BNSF's application, the Corps issued a public notice describing the application and solicited comments from the public. The Corps worked with other federal, state, and local authorities regarding the proposal, and asked the EPA to participate in its review as a cooperating agency. BNSF and its consultants provided the Corps with information relevant to this analysis.

The Corps then prepared a draft environmental assessment based on this information and comments provided by other agencies. As part of its alternatives analysis under the Clean Water Act (CWA), the Corps considered many options, including modifications to existing BNSF facilities, seven alternative sites for a new intermodal facility, alternative designs for the facility, and a no-action alternative.

Based on this review, the Corps concluded modifications to BNSF's existing facilities were infeasible due to space limitations. The Corps also found the no-action alternative would have detrimental impacts on regional traffic and air quality because increased shipping by trucks would be necessary to handle all growth in freight shipments in the area. In its analysis of alternative sites for the intermodal facility, the Corps compared the proposed sites to criteria provided by BNSF. For example, BNSF required the site to be close to existing rail tracks and highways, large enough to handle the projected volume of freight, and within 30 miles of BNSF's existing intermodal facility at the Argentine Yard.

After applying BNSF's criteria, the Corps eliminated all alternatives as impracticable except for the Gardner site and a nearby location, Wellsville North.² Therefore, the Corps analyzed the potential environmental impacts only of the Gardner and Wellsville North sites. The Corps determined construction at Gardner would impact 17,302 linear feet of streams and 4.61 acres of wetlands, whereas construction at Wellsville North would impact 19,594 linear feet of streams and 15.83 acres of wetlands. It also determined the streams and wetlands at Wellsville North were of a higher quality than those at Gardner. Based on this comparison, the Corps concluded construction at Gardner was the least environmentally damaging practicable alternative under the CWA.

The Corps also prepared an environmental assessment to consider the impact of BNSF's proposal on the human environment, as required by the National Environmental Policy Act (NEPA). This analysis considered both direct and reasonably foreseeable indirect impacts to land use, air quality, noise, traffic, water quality, threatened and endangered species, and cultural resources.

Its air quality analysis was based on a report developed by a BNSF consultant in conjunction with the EPA, the Kansas Department of Health and the Environment (KDHE), and the Mid–America Regional Council. This report went through multiple rounds of review and analysis to incorporate feedback from these agencies. The report modeled emissions from on-site trains, trucks, miscellaneous heavy equipment used at the intermodal facility, and off-site trucks traveling to the intermodal facility, as well as the health risks associated with these emissions. The Corps determined air quality impacts from the project would not be significant, with the possible exception of fugitive dust emissions. Because BNSF and KDHE entered a binding agreement to monitor dust emissions at the site and adopt mitigation measures should emissions exceed specified levels, the Corps concluded the intermodal facility was unlikely to have any significant impacts on air quality. The EPA and KDHE concurred with this analysis.

The Corps's water quality analysis considered impacts to local streams and wetlands, as well as water quality. The Corps concluded construction at Gardner would impact 17,302 linear feet of streams and 4.61 acres of wetlands. But it also found BNSF would reroute 9,100 linear feet of streams, create 7.18 acres of wetlands, and restore a large, degraded wetland on the site. And the Corps found the intermodal facility was unlikely to significantly impact local groundwater. The agency concluded the overall impacts to onsite waters would not be significant.

After the Corps released its final environmental assessment and finding of no significant impact, it issued BNSF a § 404 permit. Soon after, Hillsdale filed a complaint in federal district court challenging the Corps's environmental analysis under both NEPA and the CWA.³ Hillsdale also moved for a preliminary injunction to halt construction of the intermodal facility, which the district court denied.

The district court then granted summary judgment to the Corps. The court upheld the Corps's conclusion that the Gardner site was the least environmentally damaging practicable alternative under the CWA. The court also affirmed the Corps's NEPA analysis of air and water impacts, concluding the Corps's reliance on KDHE's mitigation agreement was reasonable, its air quality assessment methodologies were also reasonable, and the project was not highly controversial. This appeal followed.

II. Discussion

We review the district court's grant of summary judgment de novo. New Mexico ex rel. Richardson v. Bureau of Land Management, 565 F.3d 683, 704–05 (10th Cir.2009) (New Mexico ). Because suits alleging NEPA and CWA violations are brought under the Administrative Procedure Act (APA), we review the underlying agency decision to determine whether it was “arbitrary, capricious, an abuse of discretion, or otherwise not in accordance with law.” 5 U.S.C. § 706(2)(A); Colo. Wild v. U.S. Forest...