Holy Cross Wilderness Fund v. Madigan

Decision Date03 April 1992
Docket NumberNo. 90-1252,90-1252
Citation960 F.2d 1515
Parties23 Envtl. L. Rep. 20,067 HOLY CROSS WILDERNESS FUND, Plaintiff-Appellant, v. Edward R. MADIGAN, Secretary, United States Department of Agriculture; R. Max Peterson, Chief, United States Forest Service; James F. Torrence, Regional Forester of the Rocky Mountain Region of the United States Forest Service; John O. Marsh, Secretary, United States Army; E.R. Heiberg, III, Chief, United States Army Corps of Engineers; Wayne J. Scholl, District Engineer, Sacramento District, United States Army Corps of Engineers, in their official capacities, Defendants-Appellees, and City of Colorado Springs and City of Aurora, Defendants-Intervenors-Appellees.
CourtU.S. Court of Appeals — Tenth Circuit

Lori Potter of Sierra Club Legal Defense Fund, Inc., Denver, Colo. (Henry W. Ipsen, Charlotte L. Neitzel, and Michele R. Lamontagne of Holme Roberts & Owen, Denver, Colo.; and Frances M. Green of Land and Water Fund, Boulder, Colo., with her on the briefs), for plaintiff-appellant.

Jacques B. Gelin, Atty., Dept. of Justice, Environment & Natural Resources Div., Washington, D.C. (Stuart L. Shelton, Office of Gen. Counsel, U.S. Dept. of Agriculture, Washington, D.C., of counsel; Geoffrey Worstell, Asst. District Counsel, U.S. Army Corps of Engineers, Sacramento, Cal., of counsel; Richard B. Stewart, Asst. Atty. Gen., Dept. of Justice, Environment & Natural Resources Div., Washington, D.C.; Michael J. Norton, U.S. Atty., and J. Greg Whitehair, Asst. U.S. Atty., Denver, Colo.; Dirk D. Snel, Atty., Dept. of Justice, Environment & Natural Resources Div., Washington, D.C., with him on the brief), for defendants-appellees.

Mark T. Pifher of Anderson, Johnson & Gianunzio, Colorado Springs, Colo. (M. Cole Emmons of Anderson, Johnson & Gianunzio, Colorado Springs, Colo., and John M. Dingess of Petrock, Fendel & Dingess, Denver, Colo., with him on the brief), for defendants-intervenors-appellees.

Before ANDERSON and BALDOCK, Circuit Judges, and A.J. ANDERSON, * District Judge.


The central question in this case is whether the Army Corps of Engineers violated the National Environmental Policy Act ("NEPA") and section 404 of the Clean Water Act ("CWA") when it issued a permit to allow construction of the Homestake II water project in the Holy Cross Wilderness Area, located in the White River National Forest outside Denver, Colorado prior to the completion of studies designed to develop a plan to mitigate any adverse impact on wetlands in the Wilderness Area. The appellant contends as follows: (1) the Corps violated NEPA when it issued its section 404 permit on the basis of an inadequate Final Environmental Impact Statement ("FEIS") which did not discuss mitigation measures and by failing to supplement the FEIS after obtaining additional information disputing certain of its conclusions; and (2) the Corps violated the CWA and various implementing regulations when it issued the permit before all environmental studies were completed and subjected to a full public interest review.

The Fund seeks an order invalidating the permit and enjoining the Corps from issuing a new permit until the Corps prepares a supplemental EIS and conducts a "proper" public interest review under the CWA. The district court held there was no NEPA or CWA violation and dismissed the complaint. We affirm. The crux of our holding is that, in the face of considerable conflicting expert views as to the probable impacts of the Project on Wilderness Area wetlands, the Corps' decision to issue the permit with the specific condition that there would be no wetlands losses, and with the requirement that a long-term monitoring and mitigation plan be implemented, was not arbitrary or capricious or in violation of any applicable regulations.


The Homestake II project is the second phase of a long-term water development project designed to provide the Colorado cities of Colorado Springs and Aurora (the "Cities") with additional water. It involves the diversion of water from the Cross Creek and Fall Creek drainages in the Wilderness Area to the Homestake Reservoir through a series of surface diversion structures and underground tunnels. 1 Plaintiff Holy Cross Wilderness Defense Fund is a private non-profit organization formed for the express purpose of protecting the Wilderness Area.

The Wilderness Area is an area so designated by Congress under the Colorado Wilderness Act, Title I of Public Law 96-560, 94 Stat. 3266 and to be managed under the Wilderness Act, 16 U.S.C. §§ 1131-1136. The Homestake II project is, however, exempt from the Wilderness Act's ban on water projects in wilderness areas. The Project nonetheless required authorization from the Forest Service under Title V of the Federal Land Policy and Management Act ("FLPMA") so that a portion of the Project could be built on National Forest land.

To this end, the Cities sought in January 1982 a land use easement from the Forest Service. In accordance with regulations of the Council on Environmental Quality ("CEQ"), 40 C.F.R. 1500, et seq., implementing NEPA, 42 U.S.C. § 4332(2)(C), the Forest Service conducted an environmental analysis. In May 1982 the Forest Service issued its draft Environmental Impact Statement ("DEIS"). In the DEIS the Forest Service analyzed six project alternatives. It then conducted more than 20 public hearings to receive input on the proposed project. 2 Among the main areas of concern expressed to the Forest Service was the one which is the focus of this case--the impact of the project on wetlands areas in the Wilderness Area.

In 1983, the Forest Service completed its FEIS, concluding that the Homestake project would have no significant impact on wetlands areas or other environmental resources. The Forest Service subsequently issued its Record of Decision ("ROD") and granted the land use easement to the Cities. 3 The easement contained 29 specific mitigation restrictions with which the Cities must comply. In granting the easement, the Forest Service Supervisor concluded that the grant was consistent with Executive Order 11990, "Protection of Wetlands." 4 The decision to grant the easement is not itself at issue in this case. 5

The Cities then sought from the Army Corps of Engineers the dredge and fill permit which is at issue in this case. 6 In order to discharge fill material into creek drainages in the Wilderness Area in the course of constructing the water diversion structures contemplated by the Project, the Cities were required under section 404 of the Clean Water Act, 33 U.S.C. § 1344, to obtain a permit from the Secretary of the Army, acting through the Corps. Before issuing a permit, the Corps must also comply with NEPA.

Apparently concerned that the Forest Service FEIS may not have adequately addressed the question of the impact of the Project on wetlands, the Corps asked its Environmental Laboratory to review the FEIS. In its July, 1983 report, the Laboratory concluded that the Forest Service had not adequately shown that wetland areas would be unaffected by the Project, and it recommended that the Corps acquire additional information. At approximately the same time, the U.S. Fish and Wildlife Service did its own review of the possible impact of the Project on wetlands, and concluded there would be no detrimental impact. Addendum Vol. II to Appellees' Briefs at B357.

The Corps thereafter hired a consultant, Aqua Resources, Inc. ("ARI"), to study the matter. In its May, 1984 report, ARI concluded that "[t]here is a potential for significant adverse impacts to downstream wetlands in terms of sequentially (over time) lowering the water table associated with several Cross and Fall creek wetlands." Addendum to Appellant's Opening Brief at A43. It recommended that specific additional studies be done, that pre- and post-construction monitoring be required, and that mitigation measures be developed if the additional studies showed an expected adverse impact on wetlands. Id. at A44. After reviewing the ARI Report, the Environmental Protection Agency ("EPA") concluded that "the performance of additional studies ... should be considered before any construction is undertaken in the project area to identify probable wetland impacts." Id. at A49. 7

The Corps did not in fact conduct additional studies prior to issuance of the permit. It did not prepare a supplemental EIS or its own EIS or other environmental analysis. Instead, it adopted the Forest Service's FEIS as its own and issued a permit subject to specific conditions. As the Record of Decision by the Army Corps District Engineer recognized:

[t]he Forest Service has made a reasoned decision and their judgment may ultimately prove correct. I believe, however, that due to specific mandates of my authority to protect the waters of the United States, I must take a more conservative approach. I must assume that without mitigating measures the wetlands in the Fall and Cross Creek drainages would be severely degraded by the Homestake II project.

Corps ROD at 5, Addendum Volume II to Appellees' Answer Briefs at B477 (emphasis added). He therefore issued the permit, but with the following conditions:

I intend that these wetlands be preserved, but I do not wish to unnecessarily prolong the permitting process or restrict the City's development of their water rights. Therefore, I am issuing the permit with the condition that the applicants gather the appropriate hydrologic field data, recommended by Aqua Resources Incorporated, and design a plan to prevent the loss of wetlands in the Holy Cross Wilderness area. This plan would be coordinated with the same technical experts that reviewed the draft ARI report, and must receive my approval prior to construction of permitted facilities. The plan also must include post construction monitoring for prevention of long-term impacts of the water diversions.

Id. (emphasis added). The permit explicitly...

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