June 20, 2019

Tenth Circuit: Appeal of Fracking Regulation Unripe Due to Uncertainty of Future

The Tenth Circuit Court of Appeals issued its opinion in State of Wyoming v. Zinke on Thursday, September 21, 2017.

In this case, the Tenth Circuit Court of Appeals is asked to decide whether the Bureau of Land Management (BLM) acted beyond its statutory authority when it created a regulation that governed hydraulic fracturing (fracking) on lands owned by the United States.

As fracking has become more common, public concern has increased about whether fracking is contributing to contamination of underground water sources. The BLM responded by preparing a regulation that attempted to modernize the existing federal regulations governing fracking on lands owned by the United States by increasing disclosure of the chemicals used in fracking, updating the standards for wellbore construction and testing, and addressing management of water used in the fracking process.

The finalized, published fracking regulation attempted to regulate fracking in four ways: by (1) imposing new well construction and testing requirements; (2) imposing new flowback storage requirements; (3) imposing new chemical disclosure requirements; and (4) generally increasing BLM’s oversight of fracking.

Shortly before the fracking regulation was to take effect, the Independent Petroleum Association of America (IPAA) and the Western Energy Alliance (WEA) filed a petition for review under the Administrative Procedure Act (APA), opposing the new regulation. North Dakota, Utah, and the Ute Indian Tribe also intervened.

The petition for review asserted that the fracking regulation violated two provisions of the APA in two ways: (1) the regulation was arbitrary, capricious, an abuse of discretion, or otherwise not in accordance with the law; and (2) it was in excess of statutory jurisdiction, authority, or limitations, or short of statutory right.

The district court concluded that no statute authorized the BLM to regulate fracking. The district court reasoned that states may regulate underground injections of any substance, not the federal government. According to the district court, only the states could regulate fracking.

While the parties supporting the regulation brought an appeal, the BLM asked this court to hold these appeals in abeyance, explaining that President Trump’s Executive Order required the Department of the Interior to review its regulations, including the fracking regulation, for consistency with the policies and priorities of the new administration. Another Executive Order directed the Secretary of the Interior, as soon as practicable, to publish for notice and comment proposed rules suspending, revising, or rescinding the fracking regulation at issue. The Secretary of the Interior then stated that the BLM would rescind the regulation in full.

The issue addressed in this appeal is whether the BLM has the authority to regulate fracking on lands owned or held in trust by the United States and thereby to promulgate the fracking regulation. The Tenth Circuit Court of Appeals held that the case was not ripe for review, as there was no hardship to the parties. The only harm suffered will be the continued operation of oil and gas development on federal lands, which represents no departure from the status quo since 2015. Further, the BLM will be able to proceed with its proposed rule rescinding the fracking regulation, and would face more uncertainty if these appeals were to remain under advisement. The appeal was held to be unripe and unfit for judicial review.

The Circuit dismissed the appeals, finding that the subject matter is unripe and the record is notably undeveloped or the future is particularly uncertain.

The Tenth Circuit Court of Appeals DISMISSED the appeals as prudentially unripe, VACATED the district court’s judgment invalidating the fracking regulation, and REMANDED with instructions to dismiss the underlying action without prejudice.

Tenth Circuit: Refusal to Operate Vehicle in Manner Directed by Supervisor Qualifies as Refusal to Operate

The Tenth Circuit Court of Appeals issued its opinion in TransAm Trucking, Inc. v. Administrative Review Board on Monday, August 8, 2016.

Alphonse Maddin was driving a tractor-trailer for TransAm in sub-zero temperatures on I-88 in Illinois. He could not find the TransAm-approved gas station and his truck’s fuel meter was below E, so he pulled to the side of the highway. When he tried to pull back onto the road about 10 minutes later, he discovered his brakes were frozen and had locked up. He radioed TransAm’s road assist department and was advised that a repairperson would be sent to his location. He then discovered that his bunk heater was not working and there was no heat in the cab of the truck. He fell asleep while waiting for the repair person.

Approximately two hours later, Maddin’s cousin called him and woke him up. According to the cousin, Maddin’s speech was slurred and he sounded confused. When Maddin sat up, he realized his torso was numb and he could not feel his feet. He called road assist again to report that his bunk heater was not working, telling the dispatcher about his physical condition. The road assist dispatcher told him to stay where he was. About thirty minutes later, Maddin became concerned about continuing to wait in the freezing temperatures with no heat. He unhitched the trailer from the truck, pulled a few feet away, and called his supervisor, Larry Cluck, telling him he couldn’t feel his feet and was having trouble breathing because of the cold. Cluck told him not to abandon the trailer. Cluck advised Maddin that he could either drive off with the trailer or stay there and wait for the repairperson. Maddin drove off without the trailer. About 15 minutes later, the repairperson showed up and Maddin drove back to the trailer. When the truck was repaired, Maddin called Cluck for directions to the fuel stop. Cluck threatened to write Maddin up for missing his fuel stop or a late load. Later, Cluck informed Maddin that he was being written up for abandoning his trailer. He was terminated less than a week later for violating company policy by abandoning his load.

Maddin filed a complaint with OSHA, asserting TransAm violated the whistleblower provisions of the Surface Transportation Assistance Act (STAA) when it terminated him. After OSHA dismissed his complaint, Maddin requested a hearing with a Department of Labor ALJ. The ALJ concluded Maddin engaged in protected activity when he reported his defective vehicle to TransAm and again when he refused to obey Cluck’s order to either drive the defective vehicle or stay put. The ALJ found that the protected activity was inextricably intertwined with TransAm’s decision to terminate Maddin, and eventually awarded back pay from the date of discharge to the date of reinstatement, including a per diem allowance provided by TransAm. TransAm appealed the ALJ’s decision to the Administrative Review Board (ARB), which upheld the ALJ’s findings and backpay award. TransAm filed a petition for review in the Tenth Circuit.

TransAm first argued that frozen brakes are not the type of vehicle complaint contemplated by the STAA. The Tenth Circuit declined to resolve the question because the ARB’s decision could be affirmed under another aspect of the STAA also relied on by the ARB. The alternative provision makes it unlawful for an employer to discharge an employee who refuses to operate a vehicle due to safety concerns. TransAm argued that Maddin did not refuse to operate the vehicle since he drove away. The Tenth Circuit applied Chevron deference to the agency’s interpretation of the word “operate,” and found no authority to support that Congress intended to limit the word “operate” solely to driving. The ARB interpreted “operate” to encompass situations in which an employee refused to use a vehicle in the manner directed by the employer, and the Tenth Circuit majority approved of this definition. TransAm argued it would have been impossible for Maddin to drive off while the trailer’s brakes were frozen, so his refusal to drag the trailer could not have contributed to his termination because he could not “defy the laws of physics,” therefore it was not protected activity. The Tenth Circuit majority disagreed. The Tenth Circuit found ample evidence supporting the ARB’s causation finding.

TransAm also raised three challenges to the backpay award. First, it contended that the per diem allowances should not have been included, but the ARB found that because the allowances were paid whenever Maddin drove for TransAm and did not appear to be intended to offset expenses, they were properly included as lost earnings. TransAm argued that the per diems were intended to reimburse Maddin for expenses, but no record evidence supported its assertion. TransAm also challenged the ARB’s refusal to offset the backpay award for earnings from 2010 to 2012, arguing no evidence supported the ALJ’s finding that the income was less than Maddin’s incurred business expenses. The Tenth Circuit, however, noted that the ARB specifically referenced Maddin’s IRS tax records and a personal statement, both of which supported the ALJ’s finding. The Tenth Circuit also rejected TransAm’s argument that Maddin was not entitled to backpay with interest for the entire period between his termination and reinstatement, finding TransAm’s statements conclusory, self-serving, and unsupported.

The Tenth Circuit denied TransAm’s petition for review. Judge Gorsuch dissented; he would not have applied Chevron and instead would have relied on the dictionary definition of “operate” in determining whether Maddin operated the vehicle in defiance of his supervisor’s orders.

Tenth Circuit: ALJ’s Citations to Preamble to Regulations Did Not Violate APA

The Tenth Circuit Court of Appeals issued its opinion in Blue Mountain Energy v. Director, Office of Workers’ Compensation Programs, United States Department of Labor on Friday, November 13, 2015.

In 2002, Terry Gunderson filed a claim for benefits under the Black Lung Benefits Act (BLBA), claiming that his chronic obstructive pulmonary disease (COPD) was caused by his more than 30 years working for Blue Mountain Energy as a coal miner. Blue Mountain denied benefits, contending Gunderson’s COPD was caused by his 34 years of smoking. In the initial hearing on Gunderson’s claim, both sides presented expert testimony addressing the cause of his COPD. The ALJ found the experts well qualified and found their reports both well reasoned and well documented. The ALJ ruled that the expert opinions were “evenly balanced” and deserved “equal weight,” and concluded that Gunderson had failed to carry his burden of proof. The ALJ denied his claim for benefits, and the Benefits Review Board affirmed. On appeal, the Tenth Circuit remanded, finding that the ALJ failed to comply with the Administrative Procedure Act because he did not provide the reasons or basis for his rejection of Gunderson’s claim of legal pneumoconiosis.

On remand, the ALJ stated that the circuit court was requiring him to choose one party’s argument over the other and gave a cursory explanation of why he found one doctor more persuasive than the others. On appeal, the Board vacated and remanded the case to the ALJ, finding that the ALJ had misunderstood the directions from the circuit court and had not fully explained his reasoning or offer a scientific explanation of his evaluation of the differing medical opinions.

On the second remand, the ALJ made detailed findings concerning each doctor’s report. The ALJ discussed his reasons for finding reports more or less credible, including the physicians’ individual evaluations of the claimant in this case. The ALJ ultimately awarded benefits to Gunderson. Blue Mountain moved for reconsideration, requesting the ALJ to reopen the record so it could respond to the statements relied on by the ALJ and arguing the ALJ improperly determined the date on which benefits should have started. The ALJ agreed that he miscalculated the date and adjusted his opinion accordingly but otherwise denied Blue Mountain’s motion. Blue Mountain then appealed to the Board, which affirmed the ALJ’s decision, finding the ALJ had applied a correct legal standard to determine whether the claimant suffered pneumoconiosis and had permissibly relied on the preamble to the 2001 regulations as a statement of medical principles. Blue Mountain appealed to the Tenth Circuit.

Blue Mountain argued that the ALJ violated the Administrative Procedures Act by relying on the preamble to the regulations and thus giving the preamble the “force and effect of law,” and by refusing to reopen the record to allow Blue Mountain to submit evidence challenging the science of the preamble. The Tenth Circuit rejected both arguments. The Tenth Circuit first noted that the ALJ only referenced the preamble twice in his ruling, and used it only as a tool for evaluating the credibility of the experts. The Tenth Circuit held that the ALJ’s use of the preamble was lawful, citing many other circuits that had similarly agreed the use of the preamble is lawful. Blue Mountain unsuccessfully attempted to distinguish those cases, arguing the only difference between the ALJ’s first two opinions and its third opinion was the citation to the preamble. The Tenth Circuit disagreed, noting that the ALJ’s third opinion more rigorously analyzed the physicians’ reports and it was understandable that he would have come to a different outcome by evaluating the evidence thoroughly. Blue Mountain also argued that the ALJ gave the preamble the “force and effect of law,” but the Tenth Circuit found that the two passing references imply that the ALJ used the preamble as a guide, not a binding legal principle.

Blue Mountain also argued that the ALJ abused his discretion by denying its motion to reopen the record. The Tenth Circuit again disagreed. The Tenth Circuit noted that Blue Mountain was well aware of the preamble to the regulations and had ample opportunity to submit opposing opinions for the ALJ’s consideration.

The Tenth Circuit affirmed the Board and the ALJ.

Colorado Court of Appeals: Open Meetings Law Allows Voiding of Actions Taken Without Meeting

The Colorado Court of Appeals issued its opinion in Wisdom Works Counseling Services, P.C. v. Colorado Department of Corrections on Thursday, August 27, 2015.

Sex Offender Treatment—Application—Denial—Colorado’s Open Meeting Law.

The Approved Treatment Provider Review Board (Board) denied two applications by plaintiff for certification as an approved provider of sex offender treatment for Colorado Department of Corrections (DOC) parolees. The Board denied both applications based on independent reviews by two of its members but without a meeting among the members of the entire Board. The trial court concluded that the Board had violated former DOC Regulation 250-23 (2011) by denying the applications without meeting. The DOC appealed.

The Board is a “state public body” and subject to the Colorado’s Open Meetings Law (OML). OML prohibits public businesses from being conducted “in secret.” Although OML does not require public bodies to meet, the remedy of voiding certain actions taken without meeting applies to a public body, even if its regulations or practices do not require a meeting. Because the Board denied the applications without meeting, the denials must be set aside. On remand, the district court shall return the proceeding to the Board for further action consistent with this opinion.

On cross-appeal, plaintiff contended that the trial court erred in holding that the Administrative Procedure Act (APA) did not apply to the Board’s actions and in denying CRCP 106 relief. Because CRS § 17-1-111 exempts the denials from the APA, the portion of the trial court’s order rejecting plaintiff’s APA claim was affirmed.

Summary and full case available here, courtesy of The Colorado Lawyer.

Tenth Circuit: Fish & Wildlife Service Appropriately Evaluated Environmental Impact of Rocky Flats Transportation Improvement

The Tenth Circuit Court of Appeals issued its opinion in WildEarth Guardians v. United States Fish & Wildlife Service on Friday, April 17, 2015.

WildEarth Guardians, Rocky Mountain Wild, and the Town of Superior (Appellants) challenged the authority of the U.S. Fish & Wildlife Service (FWS) to construct a parkway through the former Rocky Flats nuclear facility. Rocky Flats was formerly used to manufacture nuclear weapons, and since 1989 the Department of Energy (DOE) has been tasked with a cleanup effort to remediate the land. Under the Rocky Flats Act, Congress designated authority to the DOE to manage the central area of the Flats, which was contaminated by plutonium and other hazardous materials, and transferred the remainder of the land to the FWS to become a National Wildlife Refuge. The Rocky Flats Act further provided the DOE would transfer the remainder of the land to the FWS as soon as the cleanup was complete, and set aside a large parcel of land at the Flats’ border to be used for transportation improvements (specifically, the parkway).

The DOE transferred the remaining land to the FWS in 2007, and the FWS began considering applications for the transportation project jointly with the DOE. Prior to final approval of the land exchange and construction project, the FWS issued two opinions regarding the potential consequences to the Preble’s Meadow Jumping Mouse, a threatened species with a critical habitat in the corridor. The FWS also issued an environmental assessment pursuant to its duties under the National Environmental Policy Act (NEPA). Appellants sued in district court, arguing the FWS violated the Rocky Flats Act, the NEPA, and the Endangered Species Act. The district court rejected all three claims, and Appellants timely appealed.

The Tenth Circuit considered the appeal under the Administrative Procedures Act, evaluating only whether the FWS’s actions were arbitrary and capricious. The Tenth Circuit first addressed Appellants’ argument that the FWS lacked authority to convey the land under the Rocky Flats Act. Applying the Chevron test, the Tenth Circuit found that Congress did not directly discuss whether the FWS could convey the corridor, but by effectuating the intent of Congress and taking the statutory language in context, the Tenth Circuit determined that it was reasonable to assume Congress intended the FWS to convey the corridor for transportation purposes if it had not already been conveyed by DOE. The FWS further asserted it had authority to convey the land under the Refuge Act and Fish and Wildlife Act, and the Tenth Circuit agreed. The Tenth Circuit rejected Appellants’ argument that a catch-all clause in the Rocky Flats Act was meant only to refer to the transportation conveyance, finding that the conveyance was discussed in detail in other parts of the Act, and “Congress knew how to write ‘transportation improvements'” but did not do so in the catch-all clause.

The Tenth Circuit turned next to Appellants’ arguments that the FWS violated NEPA, specifically with respect to contaminated soils, air pollution, and the protected mouse. Appellants argued the FWS erred by issuing an environmental assessment and finding of no significant impact instead of the more formal and detailed Environmental Impact Statement (EIS). Addressing the soil contaminants, particularly plutonium, the FWS relied on a 2006 EPA certification that the soil conditions were acceptable for unlimited use and unlimited exposure. Although Appellants argued the construction workers would be at greater risk for plutonium exposure, the FWS asserted that a 2011 letter from the EPA sufficiently addressed the risk faced by construction workers. The Tenth Circuit found no impropriety in the FWS’s reliance on the certification and letter and found no NEPA violation regarding the contaminated soils. The Tenth Circuit similarly dismissed Appellants’ contention of a NEPA violation regarding air pollution. Appellants argued the FWS failed to consider 2008 air quality standards when contemplating the transportation improvement. However, the FWS’s action occurred in 2006, and the Tenth Circuit found it unreasonable to expect the FWS to comply with an act that was not yet in existence. Finally, as to the protected mouse, the Tenth Circuit found support for the FWS action because the FWS considered the mouse habitat and found it would not be significantly affected by the transportation improvement. The Tenth Circuit noted the FWS appropriately issued an incidental take statement regarding the mouse.

The Tenth Circuit affirmed the district court’s rejection of Appellants’ claims. Appellants had requested leave to file a supplemental appendix, which the Tenth Circuit denied, and it also denied the FWS’s request to file supplemental rebuttal appendix documents as moot.

Colorado Court of Appeals: Declaratory Judgment Appropriate and Statutory Definition of Firearm Encompasses Bow Hunting

The Colorado Court of Appeals issued its opinion in Moss v. Board of County Commissioners for Boulder County on Thursday, March 26, 2015.

Declaratory Judgment—Firearm—Definition—County Board—Geographic Area.

This case concerns a county resolution that prohibits firearm discharges in a designated area of Sugar Loaf Mountain in unincorporated Boulder County. Moss and Westby live and own property in this area. Colorado Advocates for Public Safety is a nonprofit corporation whose mission is to assist in protecting the public from safety hazards, such as those involving firearms. This dispute between plaintiffs and the Board of County Commissioners for Boulder County (County Board) centers around the definition and scope of this resolution.

On appeal, plaintiffs contended that the district court erred in dismissing their declaratory judgment claim, wherein plaintiffs sought a judicial determination that, as a matter of law, the word “firearm” in CRS §§ 30-15-301 to -302 and Resolution 80-52 includes bows and arrows. Because a declaratory judgment would terminate the controversy or uncertainty regarding the scope of the resolution, plaintiffs’ declaratory judgment claim was properly raised in the district court and the district court erred in declining to address it.

The statute that authorizes counties to prohibit firearm discharges expressly defines “firearm” or “firearms” as “any pistol, revolver, rifle, or other weapon of any description from which any shot, projectile, or bullet may be discharged.” A bow is a weapon and an arrow is a projectile. Therefore, a bow and arrow constitute a “firearm” under this statute, and plaintiffs were entitled to a declaratory judgment in their favor on this issue.

Plaintiffs also requested an expansion of the geographic area covered by the resolution in their claim for injunctive relief. CRS § 30-15-302 does not subject the County Board to any procedural requirements to address plaintiffs’ request, and Colorado’s Administrative Procedure Act does not apply to the County Board. Additionally, plaintiffs concede that they have not asserted and cannot assert a claim under CRCP 106(a)(4) because there has been no final agency action in this case. Finally, plaintiffs have failed to state a constitutional due process claim on which relief can be granted. Therefore, the district court did not err in dismissing plaintiffs’ claim for injunctive relief on this issue.

Summary and full case available here, courtesy of The Colorado Lawyer.

Tenth Circuit: Election Assistance Commission Not Required to Approve State Requests to Amend Voter Registration Form

The Tenth Circuit Court of Appeals issued its opinion in Kobach v. United States Election Assistance Commission on Friday, November 7, 2014.

The secretaries of state from Arizona and Kansas, Ken Bennett and Kris Kobach, respectively, sought to have the Election Assistance Commission (EAC) add language requiring documentary proof of citizenship to each state’s instructions on the federal voter registration form. The EAC concluded the additional language was unnecessary and denied their requests. Kobach and Bennett filed suit in federal district court challenging the denial, and the district court held the EAC had a nondiscretionary duty to grant their requests.

The Tenth Circuit disagreed with the district court’s reasoning, holding that the district court’s decision is in direct conflict with the Supreme Court’s recent decision in Arizona v. Inter Tribal Council of Arizona, Inc., 133 S. Ct. 2247 (2013) (ITCA). Justice Thomas’ dissent in ITCA endorsed the theory brought to the Tenth Circuit by Arizona and Kansas in this appeal, thus clearly explaining what the law does not provide. The EAC had valid authority to subdelegate decision-making authority to its Executive Director relating to the contents of the federal form. Under the unique circumstances of this case, an appeal from the Executive Director’s decision denying the requests to modify the federal form was impracticable, and consequently the decision qualifies as a final agency action, which was procedurally valid. The National Voter Registration Act’s requirements do not impose a ministerial duty on the EAC to approve state requests to change the form.

The Tenth Circuit reversed the district court’s ruling and remanded with instructions for the district court to vacate its order mandating EAC modifications to the federal form.

Tenth Circuit: No Arbitrariness or Caprice in EPA’s Adoption of Better-Than-BART Emission Regulations

The Tenth Circuit Court of Appeals issued its opinion in WildEarth Guardians v. United States Environmental Protection Agency on Tuesday, October 21, 2014.

In an attempt to comply with the Clean Air Act, New Mexico, Wyoming, Utah, the City of Albuquerque, and Bernalillo County, NM (collectively, states), adopted a regional cap-and-trade program to regulate sulfur-dioxide emissions over the Colorado Plateau. In this program, the states had to comply with ceilings on sulfur-dioxide emissions. If their emissions were above the ceiling, they were fined, but if they fell below the ceiling, the states could trade the difference to other entities. The states chose this program over the alternative Best Available Retrofit Technology (BART) program to reduce emissions. The cap-and-trade program had to be better than BART to be acceptable.

WildEarth Guardians and other environmental groups (collectively, WildEarth) protested the adoption of the cap-and-trade program, arguing the EPA should not have approved the cap-and-trade program for various reasons. The Tenth Circuit reviewed the appeal, but its review was bound by the Administrative Procedure Act, and the EPA’s decision could only be overturned by a showing that its action was arbitrary or capricious.

WildEarth argued that the cap-and-trade program, also known as the 309 program, does not achieve greater reasonable progress than implementation of BART. WildEarth contended the EPA acted arbitrarily and capriciously because the BART benchmark improperly adopted the permissive emission cap instead of actual emissions, the states misapplied the “clear weight of the evidence” standard, and the states overstated the effectiveness of the 309 program by applying qualitative instead of quantitative standards. The Tenth Circuit rejected these arguments.

First addressing the argument about the EPA’s reliance on permissive emission caps instead of actual data, the Tenth Circuit noted that the EPA’s own rules allowed reliance on the cap, and also the data concerning actual emissions was not available until the end of the period in which the emissions were studied. The source-by-source study was not required under the 309 program’s better-than-BART standard. Although there was potential for the states to trade emission amounts that they were not actually using, this was permissible under the 309 program.

Next, the Tenth Circuit addressed WildEarth’s argument that the EPA should have compared the 309 program’s milestones to the effectiveness of BART. The Tenth Circuit refused to address this argument because it was not raised in WildEarth’s opening brief, and was raised for the first time on appeal.

The Tenth Circuit then turned its attention to the qualitative versus quantitative argument, and found no caprice or arbitrariness in the EPA’s actions. The EPA determined the 309 program as a whole was more effective than BART because it included non-BART sources of sulfur-dioxide emissions, included new sources of emissions, created a “mass based” cap covering emissions in the aggregate, and encouraged early reductions in emissions. WildEarth argued that the actual pollution would not be reduced, and could even be increased, by the failure of key polluters to agree to the 309 program, the ability of the states to trade their unused emission allotments, and the failure to consider quantitative standards. Although the Tenth Circuit was sympathetic to WildEarth’s arguments, it could find no reason to overturn the EPA’s decision.

The Tenth Circuit denied the petitions for review because it could find no arbitrariness or caprice in the decisions of the EPA.

Tenth Circuit: Forest Service’s Management Plans Did Not Violate National Forest Management Act or Environmental Protection Act

The Tenth Circuit Court of Appeals issued its opinion in Biodiversity Conservation Alliance v. Jiron on Tuesday, August 5, 2014.

Biodiversity sued the U.S. Forest Service in two separate cases involving Forest Service actions in the Black Hills National Forest. In the first case, filed in the U.S. District Court for the District of Wyoming, Biodiversity claimed the Forest Service failed to comply with various statutes and regulations. The district court denied Biodiversity’s petition for review. In the second case, filed in the U.S. District Court for the District of Colorado, Biodiversity argued the Forest Service had violated a settlement agreement and moved for relief. The district court dismissed Biodiversity’s motion. Biodiversity appealed both rulings and the cases were consolidated for appellate review.

In 1976, the National Forest Management Act (NFMA) took effect, and the Forest Service created a plan under which it managed the Black Hills National Forest. In 1992, the Forest Service decided to revise the plan, and in 1997 it issued its revised forest plan. Biodiversity challenged the 1997 plan in an administrative proceeding, and its appeal was decided by the Chief of the Forest Service in 1999. The Chief determined that although most of the plan complied with the NFMA and the National Environmental Protection Act (NEPA), there were some shortcomings, which the Chief described specifically in his ruling.

Before the Chief issued his 1999 ruling, the Forest Service began implementing its 1997 forest plan. Biodiversity administratively challenged some aspects of the plan, and eventually Biodiversity and the Forest Service entered into a settlement agreement. The settlement agreement included Phase I and Phase II plans for implementation, and the Colorado federal district court retained jurisdiction to enforce the settlement agreement. Phase I was implemented in 2001, and the Forest Service incorporated some of the Chief’s recommendations from the 1999 ruling. From 2001 through 2005, the Forest Service conducted a more detailed analysis of the Black Hills National Forest in preparation for the Phase II amendment. Also during this time, several wildfires ravaged the forest, and a mountain pine beetle infestation spread from 5,200 acres to 100,000 acres. As a result, the Phase II amendment was adjusted to address fire and insect issues.

The Forest Service considered six alternatives to implement the 1997 plan, and ultimately chose the sixth alternative even though some species would be adversely affected because the sixth plan would reduce wildfire risks and reduce the pine beetle infestation. In October 2005, the Forest Service began implementing Alternative 6 as the Phase II amendment. In 2006, Biodiversity challenged the Phase II amendment, but the Chief upheld it. In separate administrative cases, Biodiversity also challenged nine specific projects implemented as part of the Phase II amendment. The Chief denied all nine challenges, upholding the last in January 2011.

Biodiversity filed suit in Wyoming federal district court in October 2011, petitioning for agency review under the Administrative Procedures Act. In November 2012, the Wyoming court upheld the Forest Service’s action, and it denied a motion for reconsideration in April 2013. Biodiversity timely appealed.

Meanwhile, the Beaver Park litigation initiated by Biodiversity in 1999 lay dormant. After its defeat in Wyoming, Biodiversity attempted in May 2013 to reopen the Colorado case. The district court denied its motion, determining that laches barred enforcement of Biodiversity’s rights under the settlement agreement. Biodiversity timely appealed this ruling also, and the appeals were consolidated for Tenth Circuit review.

The Tenth Circuit reviewed Biodiversity’s challenges as final agency actions under the Administrative Procedures Act. Both parties agreed that each of Biodiversity’s plaintiffs established Article III standing. Biodiversity pursued review under 5 U.S.C. § 706(2)(A), arguing that the agency action was arbitrary and capricious. Biodiversity asserted violations of the NFMA and the NEPA.

The Tenth Circuit conducted a detailed analysis of each implicated section of the NFMA and NEPA. Where sections were ambiguous, the Tenth Circuit deferred to the Forest Service’s interpretation unless that interpretation was manifestly unreasonable. Regarding the population data requirement, the Tenth Circuit found that the regulation was ambiguous, and although Biodiversity raised a competing interpretation, deference was due to the Forest Service because its resolution of the ambiguity was reasonable. Regarding the Forest Service’s species viability analyses generally, Biodiversity argued that the Phase II amendment failed to ensure species viability for the Northern Goshawk, snag-dependent species, and sensitive plants. The Forest Service examined these particular species and adopted a different approach than that proposed by Biodiversity. Biodiversity failed to explain why its analysis was preferential to the Forest Service’s, however, so the Tenth Circuit deferred to the Forest Service’s scientific analyses.

Biodiversity argued the Phase II amendment failed to provide heightened protections for Research Natural Areas (RNAs) and Botanical Areas. Specifically, it alleged the Forest Service allowed livestock to graze on RNAs without specific management plans in place. However, there are no timelines for implementation of RNA management plans, and the Forest Service developed a plan as part of the 2005 Phase II implementation. Biodiversity failed to show that the Forest Service’s delay was unreasonable. As for the Botanical Areas, the Forest Service addressed these in its 1997 plan. Although Biodiversity argued the Forest Service failed to adequately monitor the well-being of the Botanical Areas, the Tenth Circuit’s APA review is narrow and examines only if the Forest Service had a rational explanation, which the Tenth Circuit found it did.

Biodiversity argued that the Forest Service failed to conduct a proper suitability and capability analysis for livestock grazing. The Tenth Circuit found no reason to conclude the Forest Service’s analysis was unreasonable, erroneous, or inconsistent with the regulation.

Biodiversity also argued that the Forest Service violated NEPA because it failed to consider no grazing alternatives in its Phase II amendment, it failed to take a “hard look” at how the amendment would affect sedimentation in Black Hills waterways, and it failed to take a “hard look” at historical grazing practices before authorizing grazing. The Tenth Circuit found no error in the Forest Service’s actions, finding instead that the Forest Service considered two no grazing alternatives, it contemplated sedimentation using Biodiversity’s proposed resources, and the Forest Service considered past grazing practices in determining that Alternative 6 was the best way to implement Phase II.

Turning to the Colorado claim, the Tenth Circuit agreed with the district court that the doctrine of laches barred Biodiversity’s assertion of the breach of settlement agreement claims. Biodiversity waited 6 1/2 years to file its suit alleging breach of the agreement, and that delay was unreasonable. The district court ruled the delay prejudiced the Forest Service, and the Tenth Circuit found no reason to disturb those findings.

The Tenth Circuit affirmed the Wyoming court’s denial of Biodiversity’s petition to review under the APA and affirmed the Colorado court’s dismissal of Biodiversity’s action to enforce the settlement agreement.

Tenth Circuit: Requiring EPA to Consider All Possible Environmental Issues Would Impede Implementation of Issues at Hand

The Tenth Circuit Court of Appeals issued its opinion in WildEarth Guardians v. United States Environmental Protection Agency on Wednesday, July 23, 2014.

Arizona Public Service Company operates a 5-unit power plant located on a Navajo reservation near Farmington, New Mexico. The plant is within 300 km of several federal Class I areas, including the Grand Canyon, Arches National Park, and Mesa Verde, and the air quality is reduced in all nearby Class I areas as a result of the plant. In 2009, the Environmental Protection Agency (EPA) began the rulemaking process to establish a final Federal Implementation Plan (FIP) to reduce haze by regulating emissions at the plant, and eventually released a proposal to regulate emissions. Arizona Public Service Company submitted an alternate proposal, in which it would close three of the plant’s units and install new selective catalytic-reduction technology on the remaining two units. The EPA found that this plan would significantly reduce emissions, and submitted the plan for comments after making some modifications. In 2012, the EPA adopted the FIP, offering two alternatives for reducing emissions: the first alternative was the original FIP and the second alternative was the modified FIP contemplating closure of three units at the plant.

During the comment period for the original FIP, the EPA received comments from the New Mexico Attorney General asserting that the plant’s mercury and selenium emissions were harming two local endangered fish species, and the EPA was required to consult on the effects of the rulemaking on the endangered species. After submitting its alternate plan, the EPA received comments from WildEarth Guardians and other environmental groups to the same effect as those of the New Mexico Attorney General. The EPA did not address the comments until after the FIP’s promulgation, at which time it responded that it disagreed with the commenters that the proposed FIP would affect the two endangered fish species and it had no duty to consult under the Endangered Species Act. The EPA further noted that closing the three units under the second alternative would reduce mercury and selenium emissions, and that the purpose of developing the FIP was to reduce visible emissions in federal Class I areas; mercury and selenium emissions do not affect visibility.

After the FIP’s promulgation, WildEarth Guardians filed a petition under 42 U.S.C. § 7607(b)(1) for review of the FIP, arguing that the EPA failed to consult with the Fish & Wildlife Service about protecting endangered fish even though it had discretion to do so. WildEarth suggested four grounds for the EPA’s exercise of discretion that could have benefited the fish: (1) requiring emissions filtering devices on the three subsequently closed units; (2) requiring Arizona Public Service Company to act sooner with regards to the remaining two units; (3) regulating sulfur dioxide emissions from the plant, which would have the collateral effect of reducing mercury and selenium emissions; or (4) directly regulating mercury and selenium emissions. The EPA and Arizona countered that the EPA had no duty to consult and no discretionary authority. The Tenth Circuit addressed WildEarth’s four suggestions in turn.

As to the first contention, the Tenth Circuit noted that it was moot, as Arizona Public Service Company closed those three units. The second suggestion was raised by WildEarth in a postbriefing letter to the court submitted under Fed. R. App. P. 28(j), but the argument was not made in WildEarth’s opening brief and was not reviewed by the Tenth Circuit. Likewise, the third suggestion was also raised in a 28(j) letter, not in the opening brief, so appellate review was denied as untimely. Prior to addressing the merits of WildEarth’s fourth argument, the Tenth Circuit evaluated its jurisdiction and found that WildEarth had Article III standing.

The Tenth Circuit then turned to the merits of WildEarth’s argument that the EPA had the duty to consult because the EPA had discretion to regulate mercury and selenium directly in the FIP. Although the Tenth Circuit doubted the EPA’s ability to regulate the emissions in the FIP, it ruled that the EPA’s “action” did not encompass the possibility of direct regulation and the subject matter of the duty to consult is bound by the agency’s action. The Tenth Circuit explained that consultation is required to ensure that the action does not jeopardize endangered species, and the request to consult does not encompass all things an agency might do but only what it is actually doing. In another case regarding the same plant, the Tenth Circuit commented that requiring the EPA to consider every possible environmental measure would impede implementation of the measures at hand, and some regulation is better than none at all.

WildEarth’s petition to review was denied.

SB 13-158: Continuing Requirement of Preparation of Cost-Benefit Analyses for Proposes Rules

On Monday, February 4, 2013, Sen. David Balmer introduced SB 13-158 – Concerning the Continuation of the Preparation of Cost-Benefit Analysis of Proposed Rules of Executive Branch Agencies, and, in Connection Therewith, Implementing the Recommendations of the 2012 Sunset Report of the Department of Regulatory Agencies. This summary is published here courtesy of the Colorado Bar Association’s e-Legislative Report.

The bill implements the recommendations of the sunset review and report on the requirements and procedures regarding the preparation of a cost-benefit analysis of proposed rules of state agencies, which recommended that the cost-benefit analysis of proposed rules be continued with modifications.

Under current law, an agency proposing rules pursuant to the “State Administrative Procedure Act” (APA) submits a draft of the proposed rules to the executive director of the department of regulatory agencies (DORA) who then determines whether proposed rules may have a negative impact on economic competitiveness or on small business and directs the agency to perform a cost-benefit analysis. The bill shifts the responsibility for deciding whether an agency needs to conduct a cost-benefit analysis of proposed rules from the executive director of DORA to the agency that is proposing rules. If an agency determines that the proposed rules have a significant negative impact on small business, job creation, or economic competitiveness, then the agency must prepare a cost-benefit analysis.

Under current law, the executive director of DORA decides whether a cost-benefit analysis is necessary no later than 20 days prior to the rule-making hearing, and the agency must complete the analysis and submit it to DORA no later than 5 days prior to the hearing, thereby limiting stakeholder input. The bill requires that the agency prepare the cost-benefit analysis prior to issuing the notice of rule-making. The bill requires the agency to submit the cost-benefit analysis and the draft of the proposed rules at the same time that the agency files the notice of rule-making with the secretary of state, thereby providing stakeholders and the public with the cost-benefit analysis and the proposed rules at an earlier time in the rule-making process.

The agency determines the proper methods for the cost-benefit analysis and may consult with representative groups regarding the cost-benefit analysis.

Under current law, a separate section of the APA provides the opportunity for any person, at least 15 days prior to the hearing, to request that the agency prepare a regulatory analysis of a proposed rule, which must be made available to the public at least 5 days prior to the rule-making hearing. The bill requires that the agency prepare a regulatory analysis for proposed rules that do not have a significant impact on small business, job creation, or economic competitiveness and for which the agency is not preparing a cost-benefit analysis. The bill requires that the agency prepare the regulatory analysis prior to issuing the notice of rule-making and to submit the regulatory analysis and the draft of the proposed rules at the same time that the agency files the notice of rule-making with the secretary of state.

The agency is not required to prepare a cost-benefit analysis or a regulatory analysis for proposed rules that implement specific requirements of legislation enacted by the general assembly or that implement requirements of federal law or federal rules.

The bill repeals the requirement that the preparation of the cost-benefit analysis be reviewed in the future through the sunset process. The bill is assigned to the Business, Labor, & Technology Committee.

SB 13-030: Requiring that Applicable Bill Sponsors and Commitees of Reference be Notified of Rules Adopted as a Result of Legislation Enacted During the Legislative Session

On Wednesday, January 9, 2013, Sen. Mark Scheffel introduced SB 13-030 – Concerning an Additional Review of Rules Promulgated Pursuant to the “State Administrative Procedure Act” by Committees of Reference of the General Assembly. This summary is published here courtesy of the Colorado Bar Association’s e-Legislative Report.

For rules adopted on or after Nov. 1, 2013, the staff of the committee on legal services are required to identify the rules that were adopted during each applicable one-year period as a result of legislation enacted during any legislative session commencing on or after Jan. 1, 2013. After such rules have been identified, the staff of the committee on legal services are required to notify in writing any prime sponsors and cosponsors of the enacted legislation who are still serving in the general assembly, and the current members of the applicable committees of reference in the senate and house of representatives for that enacted legislation that a rule has been adopted as a result of the legislation.

The bill also requires the posting of a completed cost-benefit analysis on the official web sites of the agencies completing the cost-benefit analysis and the official web site of the department of regulatory agencies. The bill is assigned to the State, Veterans, & Military Affairs Committee.