Snoqualmie Valley Pres. Alliance v. U.S. Army Corps of Eng'rs

• Decision Date: 26 June 2012
• Docket Number: No. 11–35459.,11–35459.
• Citation: 683 F.3d 1155,12 Cal. Daily Op. Serv. 7236,2012 Daily Journal D.A.R. 8809,74 ERC 1999
• Parties: SNOQUALMIE VALLEY PRESERVATION ALLIANCE, Plaintiff–Appellant, v. UNITED STATES ARMY CORPS OF ENGINEERS, Defendant–Appellee, Puget Sound Energy, Inc., Intervenor–Defendant–Appellee.
• Court: U.S. Court of Appeals — Ninth Circuit

683 F.3d 1155

74 ERC 1999

12 Cal. Daily Op. Serv. 7236

2012 Daily Journal D.A.R. 8809

SNOQUALMIE VALLEY PRESERVATION ALLIANCE, Plaintiff–Appellant,

v. UNITED STATES ARMY CORPS OF ENGINEERS, Defendant–Appellee,Puget Sound Energy, Inc., Intervenor–Defendant–Appellee.

No. 11–35459.

United States Court of Appeals, Ninth Circuit.

Argued and Submitted May 8, 2012.

Filed June 26, 2012.

Charles A. Klinge, Groen Stephens & Klinge LLP, Bellevue, WA, for the plaintiff-appellant.

J. David Gunter II, U.S. Department of Justice, Environment & Natural Resources Division, for the defendant-appellee.

Mark W. Schneider, Perkins Coie LLP, Seattle, WA, for defendant-intervenor/appellee.

Appeal from the United States District Court for the Western District of Washington, John C. Coughenour, District Judge, Presiding. D.C. No. 2:10–cv–01108–JCC.

Before: MICHAEL DALY HAWKINS, JAY S. BYBEE, and CARLOS T. BEA, Circuit Judges.

OPINION

PER CURIAM:

Puget Sound Energy (“PSE”) maintains and operates a hydroelectric power plant at the 268–foot–high Snoqualmie Falls in the state of Washington. The Snoqualmie River drains a large watershed above the falls, and all of the water from this area must pass through a single narrow channel before it reaches the falls, creating a bottleneck during heavy rains. This subjects the City of Snoqualmie, located just upstream of the falls, to persistent and significant flooding.

In the process of upgrading and modifying the plant, PSE plans to lower the dam located in the channel above the falls in order to mitigate these upstream flooding problems. PSE has already obtained a license for the project from the Federal Energy Regulatory Commission (“FERC”). Because the upgrade involves discharging fill material into the waters of the United States, which is prohibited under the Clean Water Act (“CWA”) without a permit, PSE sought verification from the U.S. Army Corps of Engineers (“Corps”) that it could proceed under a series of general nationwide permits (“NWPs”) authorizing certain discharges, rather than applying to the Corps for an individual permit. The Corps verified that it could. Downstream property owners formed the Snoqualmie Valley Preservation Alliance (“Alliance”) to challenge this decision, which they contend will exacerbate flooding problems below the falls. The district court granted summary judgment for the Corps. For the reasons explained below, we affirm.

I

In 1898, a hydroelectric power plant was first constructed at the falls. PSE proposed an upgrade to the plant in 1991, which FERC approved in a 2004 license after a lengthy study published in a 1996 Environmental Impact Statement (“EIS”). Both upstream and downstream flooding effects were evaluated in the EIS. On judicial review, we upheld FERC's decision. Snoqualmie Indian Tribe v. FERC, 545 F.3d 1207 (9th Cir.2008).

Meanwhile, in 2004 the Corps completed a section 205 ¹ flood control project and published a 1999 Environmental Assessment (“EA”) which evaluated the upstream and downstream flooding effects of the project. Because the project implemented slightly different changes related to the falls than those initially planned under the FERC license, PSE applied for an amendment to the license. Under the proposed changes to the project, the existing dam would be lowered by 2 feet and lengthened by 37 feet to match the newly excavated river bank. FERC prepared an EA concluding that the proposed changes would have little effect on flood elevations, and granted the amendment in 2009. Puget Sound Energy, Inc., 127 FERC ¶ 62,174, ¶ 64,482, 2009 WL 1549353, at *10 (2009).

Because completion of the project would involve both temporary and permanent excavation and fill of wetlands, PSE needed a permit under section 404 of the CWA, 33 U.S.C. § 1344. There are two types of section 404 permits: individual permits that authorize specific activities on a case-by-case basis, id. § 1344(a), and general permits that provide standing authorization for all activities that fit the description in the permit, id. § 1344(e). Individual permits are subject to the requirements of the National Environmental Policy Act (“NEPA”). 33 C.F.R. § 325.2(a)(4). A general nationwide permit, on the other hand, must undergo that extensive process at the time the permit is promulgated, rather than at the time an applicant seeks to discharge fill material under such a permit. Id.§ 330.5(b)(3). Project proponents may usually “proceed with activities authorized by NWPs without notifying the [Corps].” Id. § 330.1(e)(1). The Corps does, however, allow permittees to request verification from the Corps that an activity complies with the terms and conditions of a nationwide permit, and in some cases permittees are required do so prior to beginning work under the permit. Id.§ 330.6(a)(1).

PSE submitted pre-construction notification of its plans to the Corps and sought verification that its activities would be covered under NWPs 33 and 39. In a Verification Letter and accompanying Decision Document, both issued on May 19, 2009, the Corps determined that PSE's activities fell within the scope of three different nationwide permits. First, the removal of the old dam and the construction of the new dam were determined to fall within the scope of NWP 3(a), which authorizes discharges for the replacement of a current structure, including minor deviations. SeeReissuance of Nationwide Permits, 72 Fed.Reg. 11,092, 11,181 (Army Corps of Eng'rs Mar. 12, 2007). ² Second, the temporary river diversion for purposes of preparing the work areas was determined to fall within the scope of NWP 33, which authorizes temporary discharges for “necessary ... construction activities.” See id. at 11,187. Third, the modifications to the power plant intakes and powerhouse structureswere determined to fall within the scope of NWP 39, which authorizes discharges for the “expansion of ... attendant features that are necessary for the use” of “commercial” and “institutional” buildings. See id. at 11,188. The Corps concluded that the project would have minimal individual and cumulative impacts and that it complied with all terms and conditions of NWPs 3, 33, and 39, and imposed a series of special conditions.

The Alliance filed this lawsuit challenging the Verification Letter. The complaint asserts three causes of action: first, the Corps violated the CWA by authorizing discharges under the nationwide permits rather than requiring an individual permit; second, the Corps violated NEPA by failing to prepare the EA or an EIS required for individual permits; and third, the Corps violated the Administrative Procedure Act (“APA”) because its authorization of the discharges was arbitrary and capricious or otherwise not in accordance with the law. PSE intervened in the proceedings as a defendant. On cross-motions for summary judgment, the district court granted summary judgment in favor of the Corps and PSE. This appeal followed.

II

The district court's grant of summary judgment is reviewed de novo. Alaska Ctr. for the Env't v. West, 157 F.3d 680, 682 (9th Cir.1998). Section 706 of the APA grants jurisdiction to a reviewing court to “hold unlawful and set aside agency action, findings, and conclusions found to be arbitrary, capricious, an abuse of discretion, or otherwise not in accordance with law.” 5 U.S.C. § 706(2)(A). Thus, a court may set aside an agency decision that has “entirely failed to consider an important aspect of the problem,” Butte Envtl. Council v. U.S. Army Corps of Eng'rs, 620 F.3d 936, 945 (9th Cir.2010) (internal quotation marks omitted), or failed to articulate a “rational connection between the facts found and the conclusions made,” Nat'l Wildlife Fed'n v. U.S. Army Corps of Eng'rs, 384 F.3d 1163, 1170 (9th Cir.2004) (internal quotation marks omitted). However, “[t]he scope of review under the ‘arbitrary and capricious' standard is narrow and a court is not to substitute its judgment for that of the agency.” Motor Vehicle Mfrs. Ass'n v. State Farm Mut. Auto. Ins. Co., 463 U.S. 29, 43, 103 S.Ct. 2856, 77 L.Ed.2d 443 (1983).

III

A

PSE raises an initial jurisdictional argument which the Corps does not: whether this suit is an improper collateral attack against the FERC license and amendment. First, PSE argues that the claims made here could, and therefore should, have been raised during judicial review of the FERC license, presumably Snoqualmie Indian Tribe, 545 F.3d 1207. Second, citing California Save Our Streams Council, Inc. v. Yeutter, 887 F.2d 908, 911–12 (9th Cir.1989), PSE argues that the “practical effect” of a judgment against the Corps in this case would be to “restrain the licensing procedures authorized by FERC.”

With regard to the first argument, we note that the instant claims against the Corps could not have been raised in the challenge to the FERC license amendment because the Corps had not yet verified that PSE could proceed via general nationwide permits rather than applying for an individual permit. PSE does not contend that the Corps had no role to play in this project, or that obtaining a section 404 permit was an unnecessary step. The Alliance could therefore not have brought any of their present claims in the earlier lawsuit.

In support of its second argument, PSE points to the remedies requested by the Alliance, which include requiring the Corps to impose mitigation measures, such as rebuilding the dam to its original height and canceling the plans to widen the riverbank. PSE notes that such remedies would interfere with activities specifically authorized by the FERC license. While this is true, it does not follow that this action is an improper collateral attack on the FERC license. If the Alliance were to prevail, the remedy would be an injunction against the Corps to instruct PSE to apply for an individual permit and to perform a full NEPA analysis of the proposed action. The resulting EIS or EA would have no effect on the validity of FERC's license. The sufficiency...