State of NC v. Hudson

• Citation: 665 F. Supp. 428
• Decision Date: 07 July 1987
• Docket Number: No. 84-36-CIV-5.,84-36-CIV-5.
• Court: U.S. District Court — Eastern District of North Carolina
• Parties: STATE OF NORTH CAROLINA, et al., Plaintiffs, v. Colonel Ronald E. HUDSON, et al., Defendants.

665 F. Supp. 428

STATE OF NORTH CAROLINA, et al., Plaintiffs, v. Colonel Ronald E. HUDSON, et al., Defendants.

No. 84-36-CIV-5.

United States District Court, E.D. North Carolina, Raleigh Division.

July 7, 1987.

COPYRIGHT MATERIAL OMITTED

Lacy H. Thornburg, Atty. Gen., Daniel C. Oakley, Spec. Deputy Atty. Gen., Asst. Atty. Gen., N.C. Dept. of Justice, Raleigh, N.C., Andrew P. Miller, Dickstein, Shapiro & Morin, Washington, D.C., for plaintiff.

Rudolf A. Renfer, Jr., Asst. U.S. Atty., Raleigh, N.C., for Federal defendants.

Glen R. Goodsell Lands Division, U.S. Dept. of Justice, Washington, D.C.

Lloyd C. Smith, Jr., Smith & Daly, Windsor, N.C., for Bertie C., N.C.

Larry M. Jones, Lawrenceville, Va., for Board of Supervisors of Brunswick Co., Va.

Edwin B. Baker, Baker & Williams, Keysville, Va., for Board of Supervisors of Charlotte Co., Va.

William T. Watkins, Watkins, Fincy & Hopper, Oxford, N.C., for Granville Co., N.C.

William W. Bennett, Jr., Slayton, Bennett & Rand, South Boston, Va., for Board of Supervisors of Halifax Co., Va.

John A. James, Weldon, N.C., for Halifax Co., N.C.

William R. Peel, Williamston, N.C., for Martin Co., N.C.

Frank D. Harris, Harris & Matthews, South Hill, Va., for Board of Supervisors of Mecklenburg Co., Va.

Charles J. Vaughan, Woodland, N.C., for Northampton Co., N.C.

Henry W. Hight, Jr., Henderson, N.C., for Vance Co., N.C.

Charles T. Johnson, Jr., Warrenton, N.C., for Warren Co., N.C.

Huey Marshal, Plymouth, N.C., for Washington Co., N.C.

Lewis A. Thompson, III, Banzet, Banzet & Thompson, Warrenton, N.C. and Patrick M. McSweeney, James F. Stutts, Brian L. Buniva, Richmond, Va., for Roanoke River Basin Assoc.

MEMORANDUM OPINION

BRITT, Chief Judge.

This action seeks judicial review of two decisions of the United States Army Corps of Engineers: (1) to issue a permit to the City of Virginia Beach, Virginia, under section 10 of the Rivers and Harbors Appropriation Act of 1899, 33 U.S.C.A. § 403 (West 1986), and section 404 of the Clean Water Act of 1977, 33 U.S.C.A. § 1344 (West 1986), to construct a water intake structure and pipeline in Lake Gaston to extend to Suffolk, Virginia; and (2) to enter into a water storage reallocation contract for Kerr Reservoir on behalf of the United States with the City of Virginia Beach pursuant to the Water Supply Act of 1958, 43 U.S.C.A. § 390b (West 1986). Plaintiffs, the State of North Carolina, the Roanoke River Basin Association (RRBA), four counties located in Virginia and eight counties located in North Carolina, challenge the issuance of the permit, contending that it violates the National Environmental Policy Act (NEPA) of 1969, 42 U.S. C.A. §§ 4321-4347 (1977), the Clean Water Act of 1977, the Rivers and Harbors Appropriation Act of 1899, the Coastal Zone Management Act, 16 U.S.C.A. §§ 1451-1464 (West 1985), the Water Supply Act and the various federal regulations implementing those statutes. Plaintiffs allege that the contract was executed in violation of NEPA, the Water Supply Act, the Clean Water Act and their implementing regulations. Plaintiffs ask the court to declare the pipeline construction permit and water supply contract void and remand the case to the Corps, with directions that before issuing any new permit or entering into any new water supply contract the Corps must (1) prepare an environmental impact statement (EIS) pursuant to section 102(2)(C) of NEPA and (2) conduct a meaningful public interest review pursuant to 33 C.F.R. § 320.4 (1986).

A hearing was held on 7 November 1986 on the parties' motions for summary judgment, and the case is now ripe for final disposition on the merits.

I. FACTS AND PRIOR PROCEEDINGS

The City of Virginia Beach, Virginia (Virginia Beach), now the largest in the state, is located on the Atlantic Ocean and in close proximity to other large bodies of water, such as Chesapeake Bay and the James River. Yet it suffers from a lack of an adequate supply of potable water to meet the needs of its citizens. Until recently when five wells were constructed for contingency use in the event of an emergency,¹ it depended entirely on the City of Norfolk for its water. The need for water has been especially acute in times of drought, and on at least three occasions in the last decade droughts have brought hardship on the citizens and the implementation of conservation measures, including rationing. Seeking a permanent solution to its problem, Virginia Beach engaged in studies of its own and participated in joint studies with others. Every conceivable source, including desalting, wastewater reuse, groundwater, lakes and rivers, was explored before the City decided that its best alternative for a reliable source was Lake Gaston in the Roanoke River Basin.

The Roanoke River has its headwaters in the mountains of Virginia, near the City of Roanoke. It flows southeasterly, crossing the North Carolina border between Bracey, Virginia, and Gaston, North Carolina, and empties into the Albemarle Sound near Plymouth. Over the years several dams have been constructed on the river for flood control and hydroelectric purposes. This has resulted in several lakes, including Smith Mountain, John H. Kerr,² Gaston and Roanoke Rapids.

On 15 July 1983 Virginia Beach applied to the Norfolk District of the Army Corps of Engineers for a permit to construct a water intake structure, pier, boathouse and ramp in the Pea Hill Creek tributary of Lake Gaston located in Brunswick County, Virginia, and a sixty-inch inside diameter concrete pipe to extend to the City of Norfolk's water transport and treatment facilities located in Suffolk, Virginia, a distance of approximately 84.5 miles.³ The pipeline was proposed to withdraw and transport up to a total of sixty million gallons per day (mgd) of water by the year 2030. Under the proposal forty-eight mgd would ultimately be treated for the use of Virginia Beach, ten mgd for Chesapeake, one mgd for the Isle of Wight County, and one mgd for Franklin. As part of its application Virginia Beach submitted an environmental study prepared by its consultants intended to assess the probable environmental impacts of the proposed project and evaluate alternatives to the proposal.

Over the next several months approximately 6,000 people attended three public hearings in North Carolina and Virginia where substantial oral and written comments were presented expressing both support for and opposition to the proposed project.⁴ On 11 October 1983 the Norfolk District Corps issued a draft environmental assessment (EA) and a preliminary finding of no significant impact (FONSI) for public review and comment. On 7 December 1983 the Corps issued its final EA and FONSI which concluded that the project would have no significant environmental impacts and therefore preparation of an EIS was not required by NEPA. Consistent with Corps regulations a thirty-day public comment period, which expired on 6 January 1984, was announced. Comments were received by the Corps in response to the final EA and FONSI, including comments submitted by North Carolina and RRBA. On 9 January 1984 the Norfolk District Engineer signed and issued a permit to Virginia Beach. At the same time he issued a Statement of Findings (SOF) addressing comments on the EA and FONSI.

Meanwhile, the Wilmington District Corps was considering a request by Virginia Beach to enter into a water supply contract pursuant to the Water Supply Act of 1958 to reallocate storage in Kerr Reservoir from power supply to water supply. The contract was proposed to reallocate to Virginia Beach 10,200-acre feet of water storage space in Kerr Lake which Virginia Beach could require the Corps to release into Lake Gaston to offset the withdrawal from Lake Gaston. On 13 January 1984 the Wilmington District Engineer adopted the EA prepared by the Norfolk District Engineer and issued a FONSI which concluded that no significant environmental impacts would result from the proposed reallocation and therefore an EIS was not required by NEPA. On 12 January 1984 the City signed the contract which was approved by the Assistant Secretary of the Army for Civil Works on 30 January 1984.

On 12 January 1984 the State of North Carolina filed this suit against Colonel Ronald E. Hudson, District Engineer for the Norfolk District of the Corps of Engineers; Colonel Wayne A. Hanson, District Engineer of the Wilmington District of the Corps of Engineers; Lieutenant General Joseph K. Bratton, the Chief of Engineers of the Corps of Engineers; William R. Gianelli, Assistant Secretary of the United States Department of the Army; and, John O. Morris, Jr., Secretary of the United States Department of the Army. All defendants are sued in their official capacities. The complaint alleges that issuance of the pipeline construction permit was arbitrary and capricious and in violation of NEPA, the Clean Water Act, the Rivers and Harbors Act, the Coastal Zone Management Act, the Water Supply Act, and the federal regulations implementing those acts. On 20 June 1984 the court allowed RRBA, eight counties in North Carolina and four counties in Virginia to intervene as plaintiffs. The counties filed a single complaint which mirrors that of the State of North Carolina.⁵ RRBA's complaint in intervention challenges the issuance of the pipeline construction permit and also challenges execution of the water storage reallocation contract between the United States and Virginia Beach. On 3 December 1985 North Carolina was allowed to amend its complaint to also challenge execution of the water storage contract. On 4 December 1985 Virginia Beach was allowed to intervene as a party defendant.

Meanwhile, on 9 January 1984, Virginia Beach initiated an action in the Eastern District of Virginia (the Virginia Beach action) against RRBA and the Governor of North Carolina seeking a declaratory judgment that the permit and contract were valid. The Governor of North Carolina moved to dismiss for lack...