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California v. Watt

ELR Citation: 13 ELR 20723
Nos. Nos. 80-1894 et al., 712 F.2d 584/19 ERC 1281/(D.C. Cir., 07/05/1983) Aff'd after remand

The court upholds the Secretary of the Interior's five-year program for offshore oil and gas leasing prepared pursuant to §18 of the Outer Continental Shelf Lands Act (OCSLA).The court first holds that the Secretary's factual findings are to be upheld if based on substantial evidence, and his policy judgments are to be upheld unless arbitrary and irrational, but his legal interpretations are subject to stricter scrutiny. The court then rules that the program discloses the time and location of proposed leasing activity as precisely as possible, as required by §18(a). Although not all portions of each proposed sale listed in the program will actually be leased, the plan need only disclose as much information about the proposed sales as is known now. Petitioners' contention that the present plan is less precise than the plan invalidated by the court in 1981, 12 ELR 20001, is meritless.

Next, the court rules that the Secretary properly considered the eight factors listed in §18(a)(2). Specifically, the Secretary properly considered benefits and risks for individual planning units under §18(a)(2)(B) and rationally based his consideration of environmental sensitivity and marine productivity exclusively on impacts from oil spills in compliance with §18(a)(2)(G). After considering the §18(a)(2) factors, the Secretary properly concluded that none of the factors posed an absolute or categorical impediment to leasing a particular area and used the §18(a)(2) information in the balancing analysis required by §18(a)(3). The Secretary adjusted the number and frequency of sales in response to the §18(a)(2) data. The Secretary did not adjust the timing of first sales based on the data, but this policy was in line with congressional intent to expedite offshore sales, and it was proper for the Secretary to consider other §18 data in determining lease timing.

The court upholds the Secretary's cost-benefit balancing analysis under §18(a)(3), granting substantial deference to the Secretary because the analysis involves methods on the frontiers of science and the time allotted the Secretary was limited. For the purpose of ranking the planning areas, the Secretary properly assumed that all reserves would be developed within one year. The Secretary's assumptions about oil prices, production costs, and external cleanup costs were reasonable and supported in the record. Also, the Secretary's decision to discount costs to their present value but not to discount benefits was allowable because the analysis compensated for this error and rendered it minor. And, the court rejects petitioners' claim that the leasing program will not assure receipt of fair market value for the leases as required by §18(a)(4).

The court rejects Oregon's and Washington's claims that the Secretary violated §§18(a) and 18(f)(5) of the OCSLA and §102 of the National Environmental Policy Act (NEPA). Under §18(a)(1) and (2), the Secretary need not evaluate a region if no leasing is contemplated for it. The court holds that the environmental impact statement prepared for the plan under §102 of NEPA adequately evaluated the potential environmental impact on Oregon and Washington. And, the court holds that §18(f)(5) of the OCSLA does not require the Secretary to state in the five-year program when he plans to make a consistency determination under §307 of the Coastal Zone Management Act.

In a final footnote, the court holds that Florida's attacks on specific leases are not ripe.

Counsel for Petitioners
John A. Saurenman, Theodore Berger, Deputy Attorneys General
Department of Justice, 555 Capitol Mall, Suite 350, Sacramento CA 95814
(916) 445-9555

Lauri J. Adams, Jonathan K. Tillinghast, Ass't Attorneys General
Pouch K, State Capitol, Juneau AK 99811
(907) 465-3600

Bruce J. Terris, James M. Hecker, Edward H. Comer
Terris & Sunderland
1526 18th St. NW, Washington DC 20036
(202) 332-1882

Sarah Chasis, Jane Bloom
Natural Resources Defense Council, Inc.
122 E. 42nd St., New York NY 10168
(212) 949-0049

Counsel for Respondents
Wells D. Burgess, James W. Moorman, Anthony C. Liotta, Bruce C. Rashkow, William M. Cohen, Margaret Strand
Land and Natural Resources Division
Department of Justice, Washington DC 20530
(202) 633-3767

Counsel for Intervenors
E. Edward Bruce, Bobby R. Burchfield, Constance J. Chatwood, Stark Ritchie, David T. Deal
Covington & Burling
P.O. Box 7566, Washington DC 20044
(202) 662-6000

Before: ROBINSON, Chief Judge, WILKEY, and SCALIA, Circuit Judges.