Sierra Club v. Cavanaugh

• Decision Date: 23 March 1978
• Docket Number: No. CIV 77-4070.,CIV 77-4070.
• Parties: SIERRA CLUB, a non-profit California Corporation, Plaintiff, v. Gordon CAVANAUGH, Individually and as Administrator, Farmers Home Administration, Jack Weiland, Individually and as South Dakota Director of Farmers Home Administration, Ronald L. Walker, Individually and as Secretary, Department of Agriculture of the United States, Minnehaha Community Water, Corp., a non-profit South Dakota Corporation, and South Lincoln Rural Water System, Inc., a non-profit South Dakota Corporation, Oak Trails, Inc., a corporation, Donald M. Frost and Gene Jones, dba F & J Enterprises, Robert W. Farrell, Ardel Prather, Leonard E. Shager and Lorna M. Shafer, Merrill Anderson and Joyce Anderson, Arther P. Rollinger and Marlene L. Rollinger, Defendants.
• Court: U.S. District Court — District of South Dakota

447 F. Supp. 427

SIERRA CLUB, a non-profit California Corporation, Plaintiff, v. Gordon CAVANAUGH, Individually and as Administrator, Farmers Home Administration, Jack Weiland, Individually and as South Dakota Director of Farmers Home Administration, Ronald L. Walker, Individually and as Secretary, Department of Agriculture of the United States, Minnehaha Community Water, Corp., a non-profit South Dakota Corporation, and South Lincoln Rural Water System, Inc., a non-profit South Dakota Corporation, Oak Trails, Inc., a corporation, Donald M. Frost and Gene Jones, dba F & J Enterprises, Robert W. Farrell, Ardel Prather, Leonard E. Shager and Lorna M. Shafer, Merrill Anderson and Joyce Anderson, Arther P. Rollinger and Marlene L. Rollinger, Defendants.

No. CIV 77-4070.

United States District Court, D. South Dakota, S. D.

March 23, 1978.

John N. Gridley III, Sioux Falls, S. D., and H. Anthony Ruckel and William H. Haring, Denver, Colo., for plaintiff.

Robert D. Hiaring, Asst. U. S. Atty., Sioux Falls, S. D., for defendants Cavanaugh, Weiland and Walker.

Richard F. Staley, Sioux Falls, S. D., for defendant Minnehaha Community Water, Corp.

Eugene J. Irons and Jeff Masten, Canton, S. D., for defendant South Lincoln Rural Water System, Inc.

Richard O. Gregerson, of Woods, Fuller, Shultz & Smith, Sioux Falls, S. D. for defendants Oak Trails, Inc., Frost, Jones, Farrell, Prather, Shafers, Andersons and Rollingers.

MEMORANDUM DECISION

NICHOL, Chief Judge.

This is an action by the Sierra Club, brought pursuant to the National Environmental Policy Act, 42 U.S.C. section 4321 et seq. (NEPA). The Sierra Club seeks to enjoin further construction of and hook-up to two rural water systems until an environmental impact statement, (EIS), is prepared on each project.

The defendants include various federal agencies and their administrators, real estate developers and the two water systems, Minnehaha Community Water, Corp., and South Lincoln Rural Water System. Although the technical features of the two systems are similar and the Sierra Club claims both will cause the same adverse environmental impacts, the facts surrounding the two systems are sufficiently distinct to merit separate consideration.

MINNEHAHA COMMUNITY WATER, CORP.

The Minnehaha Community Water, Corp., (MCWC), is a rural water system designed to serve the rural residents of Minnehaha County and several small communities of Minnehaha County. The system is financed by a loan from the Farmers Home Administration. The MCWC has a capacity of 1800 to 2000 individual users. Presently, 1550 individual users have subscribed. Bulk users have subscribed for an additional 400 individual hook-ups to the system. The bulk users are municipalities and subdivision developers who have paid the subscription fee to have the system installed to their property. The bulk subscriber, at his own expense, then completes the installation of the system at his development.

It is the ability of the bulk users to subscribe to the MCWC which the Sierra Club claims will create widespread environmental consequences such as water shortages, a reduction in water quality, the stimulation of unplanned urban sprawl, and the consumption of prime agricultural lands. The Sierra Club claims these impacts will significantly affect the environment and therefore NEPA requires the preparation of an EIS. The defendants claim the Sierra Club's action against MCWC is barred by the doctrine of laches.

Although the doctrine of laches has received a lukewarm reception in environmental litigation, where appropriate, it is applicable. Save Our Wetlands v. U. S. Army Corps of Engineers, 549 F.2d 1021, 1026 (5th Cir.1977); Minnesota Public Interest Research Group (MPIRG) v. Butz, 498 F.2d 1314, 1324 (8th Cir.1974); Lathan v. Volpe, 455 F.2d 111 (9th Cir.1971).

There are three criteria which must be met before laches can be applied. The defendants must show: (1) a delay in asserting a right or claim; (2) the delay was not excusable; and (3) there was undue prejudice to the defendants as a result of the delay. Save Our Wetlands, supra at 1026; Nolop v. Volpe, 333 F.Supp. 1364, 1367 (D.S.D.1971).

The Delay

The present action was filed on July 25, 1977. However, efforts to develop interest in and support for a rural water system in Minnehaha County began in 1971 with mailings to all Minnehaha County residents. In 1972, a steering committee was formed which held regular public meetings. The steering committee solicited subscribers through the use of numerous press releases in area newspapers and magazines. Local radio and television stations also provided coverage of the activities of the steering committee. Sign-up efforts, coupled with mailings and press coverage, have continued since 1972.

On March 5, 1973, an environmental impact assessment, (EIA), was prepared by the Farmers Home Administration which concluded that an EIS was not required by NEPA. In June of 1973, tentative funding for MCWC was approved by the Farmers Home Administration.

Efforts to obtain more subscribers continued through 1973 and 1974 with attendant publicity. In 1974 a water source was located and MCWC began obtaining easements. In late 1975 bids were let and in early 1976 contracts were awarded. Construction began in April of 1976. By the time the suit was filed in July of 1977, the MCWC was 93% completed.

The Delay Was Inexcusable

The Sierra Club contends it became aware of the nature and character of the users and the nature of the potentially adverse environmental impacts in early 1976. However, the project received widespread publicity since its inception in 1971. If the Sierra Club had been reasonably diligent, it would have discovered any potentially adverse impacts at a much earlier date.

The Dacotah Chapter of the Sierra Club, which includes members of the Sierra Club who initiated this action, was formed in July of 1975. Two members of the Dacotah Chapter who testified at trial are employed by the largest city in Minnehaha County, Sioux Falls, as urban planners. A third member was a city commissioner and the head of the Water Department of the City of Sioux Falls when the MCWC was formed. Therefore, they are somewhat knowledgeable in the area of water resource development and the causes and effects of urban sprawl. It is inexcusable that they did not adequately inform or concern themselves with the consequences of a proposed major federal action on their areas of expertise prior to 1976. Furthermore, to delay taking legal action until July of 1977 is inexcusable given their admission that they were aware of the MCWC in early 1976. Although there is a natural reluctance to impose the doctrine of laches on an uninformed group of individuals, that does not apply here where several members of the Dacotah Chapter of the Sierra Club are knowledgeable and have a degree of expertise in the nature of the adverse environmental impacts they claim will flow from the MCWC. See, Iowa Student Public Interest Research Group v. Callaway, 379 F.Supp. 714, 721 (S.D.Iowa 1974).

The Delay Was Prejudicial

During the time which the Sierra Club admits it had knowledge of the impacts of the MCWC, bids were let and awarded and construction began. At the present time, the project is 93% complete.¹ It would not be economically feasible to alter the project at this stage. Further, the third party intervenors, the developers, have paid $136,692.00 to MCWC in reliance upon MCWC supplying water to the various development sites. The MCWC has built excess capacity and larger mains into the system to accommodate the needs of the developers. Therefore, all three criteria necessary for the doctrine of laches to be applied have been met. Thus, the complaint requesting a preliminary injunction pending preparation of an EIS for the MCWC is dismissed.

SOUTH LINCOLN RURAL WATER SYSTEM

The Sierra Club also seeks a preliminary injunction to prevent construction of the South Lincoln Rural Water System, (SLRWS), until an EIS is prepared. The SLRWS is in the developmental stage. Preliminary engineering plans have been completed, but construction has not yet begun.

The SLRWS is a rural water system designed to serve the rural residents of Lincoln and Union Counties. Approximately 940 individual rural users have subscribed to the system which would serve the 3,290 rural residents of the service area. In addition, six municipalities, located in the proposed service area, with a combined population of 5,587 persons, have expressed an interest in purchasing bulk water from the system. The Farmers Home Administration is providing funding for the project.

The Sierra Club claims the SLRWS will cause two adverse environmental impacts which require the preparation of an EIS. The two impacts are: (1) the introduction of a rural water system will stimulate urban sprawl in the form of scattered site housing which will take prime agricultural land out of production and (2) the water system will aggravate an already short water supply problem. However, the Farmers Home Administration prepared an EIA on December 9, 1977, which concluded that the environmental impacts of the SLRWS are not significant enough to require the preparation of an EIS.

In MPIRG v. Butz, supra at 1320, the Eighth Circuit held that "review of an agency's determination not to prepare an impact statement should be measured by its reasonableness in the circumstances..." The defendants contend that the environmental impacts of the SLRWS will not be significant because the SLRWS will conform to existing uses and be consistent with local zoning regulations. Therefore, the defendants claim, it was reasonable for the Farmers Home Administration to conclude that an EIS need not be prepared.

The Congressional command that NEPA be complied with "to the fullest extent possible" requires that agency decisions regarding environmental impacts of proposed federal actions be made only after a full and good...