Implementing § 7 of the Endangered Species Act of 1973: First Notices from the Courts

In the first two appellate decisions¹ interpreting the Endangered Species Act of 1973,² the Fifth and Eighth Circuit Courts of Appeals recently reiterated the Act's placement of responsibility on all federal agencies to insure that their actions to not jeopardize the continued existence of endangered forms of wildlife. The rulings, which expressly acknowledge the mandatory nature of these duties imposed on federal agencies by § 7 of the Act, promise to stimulate more vigorous oversight of federal activities thatt may jeopardize endangered species or their habitat. The decisions send out confusing signals, however, as to the Interior Department's³ role vis-a-vis other agencies in determining under § 7 when a particular federal action or project jeopardizes the continued existence of an endangered species, and exactly what subsequent administrative action is necessary to prevent such harm. Thus, the decisions leave unsettled important structural aspects of the federal regulatory program for protecting endangered forms of wildlife from the detrimental impacts of federally authorized or funded activities.

Sectionn 7 of the Endangered Species Act of 1973 resembles § 102 of the National Environmental Policy Act (NEPA) in its broad application to federal actions and in the potential magnitude of its impact on federal activities. But unlike NEPA, which some federal judicial circuits have interpreted to impose only procedural obligations, § 7 unequivocally imposes a substantive duty on federal agencies by directing them, "inconsultation with" the Secretary of Interior, to take any measures necessary "to insure that actions authorized, funded, or carried out by them do not jeopardize the continued existence of such endangered species and threatened species or result in the destruction or modification of habitat of such species which is determined by the Secretary of Interior … to be critical."⁴

The Fifth Circuit's strict interpretation of this language came in National Wildlife Federation v. Coleman,⁵ a citizen suit by the National Wildlife Federation and its local affiliate that sought to force modifications in the plans for a new segment of interstate highway I-10 in southern Mississippi. The plaintiffs asserted that, as proposed, the highway would traverse the remaining habitat of the last 40 Mississippi sandhill cranes, a formally designated endangered subspecies, thereby jeopardizing the crane's continued existence. The planned segment of I-10 would also transect a portion of this area that the Interior Department's Fish and Wildlife Service (FWS) had acquired, with the help of the privately funded Nature Conservancy, as a refuge for the birds.

The FWS, to which all Interior Department functions under the Act have been delegated, began attempts to create this sanctuary for the cranes in 1973, and indicated concern at that time over the adverse impacts on the bird's habitat caused by possible highway construction in the area. After the final environmental impact statement for the I-10 segment through the area was issued, Interior wrote to the Federal Highway Administration (FHWA) expressing opposition to the project on exactly these grounds and recommended ameliorating changes in project design such as elimination of a planned interchange. FHWA ignored this appeal, however, and gave final approval to the highway project as proposed. FWS then informed FHWA that the interagency consultation required by § 7 had not occurred, and that, in addition, the Secretary of Interior would have to make a determination as to whether the project would affect habitat critical to the crane before FHWA could proceed.

Shorly thereafter, the National Wildlife Federation filed suit in federal district court under § 11(g)(1)(A)⁶ challenging FHWA's approval of the project. One day before trial began, the Fish and Wildlife Service issued, pursuant to § 6(f)(2)(B)(ii) of the Act,⁷ an emergency determination designating approximately 100,000 acres, including land to be transected by the highway, as "critical habitat" for the Mississppi sandhill crane. The reasons given by FWS for its action were that the maintenance of significant portions of habitat was threatened by construction of the highway segment, and that "[t]he construction activities, incidental intrusions, and subsequent related commercial and residential development of the area all constitute a significant risk to the well-being of the crane."

At trial, plaintiffs adduced expert testimony that the highway would jeopardize the cranes' continued existence not only through the direct acquisition of 300 acres of habitat for right-of-way, but also through habitat loss caused by borrow pit excavation, noise and [6 ELR 10121] pollution from highway traffic, and most of all, private development engendered by a proposed interchange within the cranes' habitat. In addition, they pointed to the FHWA's environmental impact statement for the project, which admitted that "a certain amount of private development will always accompany construction of a new highway facility," and that "the greatest threats to the existence of the Mississippi Sandhill Crane are private development and the construction of Interstate Route No. 10."

The district court was unpersuaded by plaintiffs' arguments, however, and entered an order denying plaintiffs' request for a preliminary injunction and dismissing the complaint.⁸ In the trial court's view, plaintiffs had failed to prove a violation of § 7 because the administrative record, including the project EIS, showed that defendants had "adequately considered the effects of this project on the Crane." In addition, the court wrote off as "mere speculation" plaintiffs' allegation that private development stimulated by the construction of I-10 with the interchange would jeopardize the crane's continued existence and result in the destruction of critical habitat.

On appeal, the Fifth Circuit held⁹ that in so ruling the district court misconstrued the requirements of § 7. While the impact statement and administrative record may have indicated that the FHWA "recognized and considered the danger the highway segment poses to the crane," this evidence also showed that the agency failed to fulfill its mandatory duty to take the necessary steps "to insure" that the highway will not jeopardize the crane or modify its critical habitat. In the court of appeals' estimation, the evidence demonstrated (1) that it is questionable whether the crane could survive the destruction of 300 acres of habitat for highway right-of-way and the additional habitat loss indirectly caused by the ancillary effects of the highway and proposed interchange, such as residential and commercial develpment, and (2) that it is "beyond question" the area determined to be critical habitat would be destroyed and modified by the drainage associated with borrow pit excavation. As an indication that concern over such indirect damage is based on more than "mere speculation," Judge Simpson, writing for the court, pointed to FHWA's acknowledgement in the EIS, ignored by the district court, that private development inevitably accompanies the construction of a major highway and that this development will be the primary effect of the project on the crane.

FHWA's assertion that acquisition by the Fish and Wildlife Service of a refuge within the larger habitat area would mitigate the highway's impact on the crane was also held to misconstrue the agency's duty under the Act. FHWA cannot rely on the proposed actions of other agencies to satisfy its burden of insuring that its own actions do not jeopardize the crane.

Judge Simpson directed the district court on remand to enjoin the FHWA from proceeding with the disputed interchange or excavating borrow pits within the area designated as critical habitat until the Secretary of Interior determines that the necessary modifications have been made in the project to insure that it will no longer jeopardize the crane's continued existence. The explanation given by the court for this deference to the Interior Secretary's determination was his primary jurisdiction for administering the Act and his department's specialized expertise regarding wildlife preservation.

This remedy may appear curious, however, because it seemingly contradicts the court's earlier statement that "Sectionn 7 does not give the Department of Interior a veto over the actions of other federal agencies, provided that the required consultation has occurred." The court was quite specific on this point:

Once an agency has had meaningful consultation with the Secretary of Interior concerning actions which may affect an endangered species the final decision of whether or not to proceed with the action lies with the agency itself.

The solution to this apparent paradox is that, in the court's view, the required consultation did not occur in this case. The sweeping remedy of an injunction pending Interior's acquiesence becomes more reasonable when viewed as an attempt to force a de facto consultation process aimed at modifications mitigating the highway's adverse impacts on the crane. Alternatively, the relief granted may reflect the court's view thatt, in light of the evidence presented, only if the modifications urged by Interior were made could a determination by FHWA that construction of the highway would not jeopardize the cranes' existence or destroy their critical habitat satisfy the standard of not being "a clear error of judgment."

The defendants were quick to pounce on this apparent inconsistency, however. Within days of the court's decision, FHWA, with Interior's concurrence, petitioned for a rehearing or a clarification of the relief granted, asking the court to delete the requirement for Interior Department approval of project modifications before the injunction can be lifted. The plaintiffs have opposed the petition, and to date no ruling on it has been made.

A crucially different factual setting under the Endangered Species Act faced the Eighth Circuit in Sierra Club v. Froehlke.¹⁰ Plaintiffs had amended their complaint to include the endangered species claim almost two years after the suit was originally filed challenging the Meramec Park Lake Dam project near St. Louis, Missouri, and only ten days before trial was scheduled. In addition, although plaintiffs asserted the project would jeopardize the continued existence of the endangered Indiana bat and destroy habitat critical to it by flooding caves which the creatures used for roosting and hibernation, FWS had not made final a proposed designation of the affected area as 'critical habitat." Evidence adduced at trial indicated that of the 700,000 Indiana bats still in existence, only 30,000 live in the Meramec basin and less than half of these would be affected by the reservoir.

Moreover, the Fish and Wildlife Service did not resort to an emergency designation of critical habitat as was later done in the case of the Mississippi sandhill crane; instead the agency urged a moratorium on the entire Meramec dam project pending further study of the [6 ELR 10122] bat. The Corps of Engineers, which would be constructing the dam, contended all along that the project would have no more than an infinitesimal effect on the Indiana bat population in the Meramec basin.

After reviewing all the evidence submitted, including expert testimony, the trial court held plaintiffs had failed to show that any of the Corps' "present activities in constructing the Meramec Park Reservoir are adversely affecting Indiana bats in the project area."¹¹ Upon its own review of the evidence, the Eighth Circuit could find no clear error in this determination. Nor could the court find grounds within the narrow scope of review applicable in its view to such agency action to overturn the Corps' substantive decision to proceed with the dam.

In construing the Interior Department's and the Corps' respective roles under § 7, the Eighth Circuit pointed to the Fifth Circuit's language in National Wildlife Federation v. Coleman as support for the proposition that the statute requires the Corps to undertake consultation with Interior but leaves with the former agency the ultimate responsibility for deciding exactly what action is necessary to insure that the project does not jeopardize the continued existence of the bat. This view is in accord with that portion of the Fifth Circuit's opinion quoted above, but does not seem easily reconcilable with the unmodified holding as to relief in that case. Here again, however, the key to reconciling an apparent conflict may be the presence or absence of meaningful consultation prior to the project agency's substantive decision and the substantially different evidentiary postures of the two cases. In Sierra Club v. Froehlke, there was no allegation, as there had been in National Wildlife Federation v. Coleman, that the preliminary consultation requirement had not been fulfilled, there was no clear expression from FWS that the proposed project would jeopardize the continued existence of the bat, and there was no determination by FWS of the bats' critical habitat.

Clearly then, the outcome in an Endangered Species Act case depends to a crucial extent on the case's factual setting. In National Wildlife Federation v. Coleman, the plaintiffs could present a basically strong case, since only 40 Mississippi sandhill cranes remain in existence, and they all live in the area to be affected by the highway Fish and Wildlife Service's "critical habitat" designation and FHWA's admission that the greatest threat to the crane is the highway construction and adjacent private development In Sierra Club v. Froehlke, on the other hand, no "critical habitat" designation had been made, only a small fraction of the remaining Indiana bat population even inhabited the area to be flooded by the Meramec dam, and the Corps of Engineers consistently and convincingly contended that the project would have only infinitesimal impacts on bat populations.

These factual differences, however, did not inhibit the courts' basic agreement on § 7's imposition of a mandatory duty on project agencies to insure that their actions do not jeopardize endangered species or destroy critical habitat, and on the concomitant requirement for project agency consultation with the Fish and Wildlife Service. Furthermore, both courts applied the "clear error of judgment" test, derived from Citizens to Preserve Overton Park v. Volpe,¹² to scrutinize the project agency's determination that it had taken all necessary action to insure that the project would not jeopardize the continued existence of an endangered species or destroy or modify habitat critical to its existence.

The salutary effect of judicial agreement on this last point is lessened, however, by the imposition of what is essentially an "arbitrary and capricious" standard of review, under which reversal of agency decisions is rare. Indeed, since an endangered species, once extinct, is irreplaceable, the stricter "preponderance of the evidence" test seems a more fitting standard for reviewing a project agency negative determination under the Endangered Species Act.

The gloss placed on the Act by both the Fifth and Eighth Circuits establishes a bifurcated regulatory system. Initially, the Interior Department, through the Fish and Wildlife Service, determines when particular species are endangered, and may designate certain areas as habitat critical to these species' continued existence. Then, any federal agency that plans to undertake an action itself, or to fund, license or approve a project to be undertaken by another party, must determine what measures are necessary to insure that this action does not destroy critical habitat or jeopardize the continued existence of one of these species.

Within this system, the Fish and Wildlife Service, although not granted a veto by the statute, nevertheless had a certain amount of leverage in convincing project agencies to modify particular actions in order to mitigathe adverse impacts on endangered species. According to unpublished FWS advisory interagency guidelines relating to the implementation of § 7, for example, the Service may, at another agency's request or on its own initiative, make a threshold determination as to whether a specific federal action may either adversely affect an endangered species or destroy habitat critical to its continued existence. In the fact of an adamant project agency decision to proceed with a suspect action, a contrary FWS threshold determination and the facts upon which it is based could become weighty evidence for the plaintiff in any citizen suit that might later be brought under § 11(g)(1)¹³ of the Act challenging the decision as a "clear error of judgment." And the FWS staff quite candidly admits that the Service intends to rely heavily on this risk of an ultimately successful citizen suit as a disincentive for other agencies according FWS less than a full and perhaps even authoritative role within the consultation process.

The opinions in both National Wildlife Federation v. Coleman and Sierra Club v. Froehlke indicate clearly that the shape and effectiveness of this process will largely determine whether the Act's broad purposes can be achieved. Ultimately, however, the current practice of informal consultation must give way to published, [6 ELR 10123] binding guidelines which establish the exact procedure and requirements for § 7 consultation. Among the specific subjects which such regulations should treat are: (1) initiation of the consultation process by a project agency threshold determination; (2) the scope of consultation; (3) the criteria to be applied in determining adverse effects — perhaps to the point of establishing degrees of jeopardy; and (4) differentation between allowable and non-allowable modification of critical habitat. As the history of administrative implementation of NEPA suggests, such regulations should be promulated not only by FWS but by all other federal agencies as well in order for the Endangered Species Act to achieve its full force and effect.

1. National Wildlife Federation v. Coleman, 529 F.2d 359, 6 ELR 20344 (5th Cir. Mar. 25, 1976); Sierra Club v. Froehlke, __ F.2d __, 6 ELR 20448 (8th Cir. Apr. 23, 1976)

2. 16 U.S.C. §§ 1531 et seq., ELR 41825. For a general analysis of the Act's purposes and provisions, see L. Wood, Sectionn 7 of the Endangered Species Act of 1973: A Significant Restriction for All Federal Activities, 5 ELR 50189 (1975).

3. While Interior has jurisdiction over most endangered species under the Act, the Department of Commerce has authority over certain ones within the marine environment, authority it has since delegated to the National Marine Fisheries Service. For simplicity's sake, however, only Interior, or the Fish and Wildlife Service (to which Interior has delegated its functions under the Act), will be mentioned in this text.

4. 6 U.S.C. § 1536, ELR 41827. Sectionn 7 also requires all federal agencies to "utilize their authorities in furtherance of the purposes of the Act by carrying out programs for the conservation of listed species…." This independent requirement was not at issue in the two cases discussed here, and has not been raised in any other case brought to date.

5. 529 F.2d 359, 6 ELR 20344 (5th Cir. Mar. 25, 1976).

6. 16 U.S.C. § 1540(g)(1)(A), ELR 41829.

7. 16 U.S.C. § 1535(f)(2)(B)(ii), ELR 41827.

8. 400 F. Supp. 705, 5 ELR 20566 (S.D. Miss. Aug. 4, 1975).

9. 529 F.2d 359, 6 ELR 20344 (5th Cir. Mar. 25, 1976).

10. __ F.2d __, 6 ELR 20448 (8th Cir. Apr. 23, 1976).

11. 392 F. Supp. 130, 5 ELR 20456 (E.D. Mo. May 19, 1975).

12. Citizens toPreserve Overton Park v. Volpe, 401 U.S. 402, 1 ELR 20110 (1971).

13. 16 U.S.C. § 1540(g)(1)(B), ELR 41829.