April 17, 2019

Tenth Circuit: Army Corps of Engineers Appropriately Considered Risks of Oil Pipeline Under Clean Water Act

The Tenth Circuit Court of Appeals issued its opinion in Sierra Club, Inc. v. Bostick on Friday, May 29, 2015.

The U.S. Army Corps of Engineers issued a nationwide permit (NWP 12) for construction of an oil pipeline pursuant to its permitting authority under § 404(e) of the Clean Water Act (CWA). TransCanada Corporation, relying on the permit and subsequent Corps verification letters, constructed the Gulf Coast Pipeline, a southern segment of the Keystone XL Pipeline, which traverses 485 miles and crosses approximately 2,000 waterways. Sierra Club, along with two other environmental groups, challenged the validity of NWP 12 and the verification letters, but the district court rejected the challenges.

On appeal, the environmental groups raised three sets of claims: (1) the Corps violated the National Environmental Policy Act (NEPA) by issuing NWP 12 without considering the risk of oil spills and the cumulative environmental impacts of the pipelines, and issued the verification letters without first conducting a NEPA analysis; (2) the Corps violated the CWA by authorizing activities with more-than-minimal environmental impact and unlawfully deferring the minimal-impact analysis to project management personnel; and (3) the Corps issued NWP 12 without analyzing cumulative effects and documenting the analysis. The Tenth Circuit addressed and rejected each set of claims.

The Tenth Circuit first addressed the NEPA claims. The environmental groups argued the Corps failed to consider the risks of oil spills in its environmental analysis, and failed to conduct an environmental analysis when it verified the pipeline was permissible under the nationwide permit. The Tenth Circuit found the environmental groups’ arguments that the Corps failed to consider the risk of oil spills and the cumulative impacts of the pipelines waived, since the groups did not raise these concerns during the comment period. The environmental groups argued that the risk of oil spills is obvious, but they instead were required to show an obvious flaw in the Corps’ evaluation, which they did not do. The Tenth Circuit found this argument waived. The groups also pointed to comments about the Keystone XL pipeline about oil spills, but the Tenth Circuit noted these comments were directed to other agencies, and in those comments no one questioned the Corps’ assessment. Similarly, the Tenth Circuit found the environmental groups’ arguments about the cumulative impacts of the pipeline waived, since they were not raised in the comment period. Although the cumulative effects were discussed in other contexts, they were never mentioned regarding the Corps’ work in dry land areas.

Next, the environmental groups argued the Corps should have prepared a NEPA analysis for the entire pipeline before issuing the verification letters. The Tenth Circuit disagreed, finding the verifications did not constitute “major federal action” necessitating NEPA review, since the verifications did not result in significant impact. The Tenth Circuit held that the Corps neither acted like a “gatekeeper” nor approved the whole project. Instead, it simply verified that TransCanada’s work was covered by NWP 12. The groups next contend the Corps should have evaluated the impacts of the whole project because the agency had “control and responsibility” over the project. However, the Tenth Circuit found the appendix to NEPA relied on by the environmental groups was inapplicable, and even if it had applied the Corps did not have “control and responsibility” over the entire project.

The Tenth Circuit next addressed the environmental groups’ argument that the Corps’ issuance of NWP 12 violated § 404(e) of the Clean Water Act by authorizing linear projects with significant environmental impact and by deferring part of the minimal-impact analysis to project-level personnel. Again disagreeing, the Tenth Circuit found that the Corps’ conclusion regarding the minimal environmental impacts involved the agency’s technical expertise, and the environmental groups were required to show the agency’s determination lacked any substantial basis in fact, which they did not do. The Corps, in analyzing the future impacts of dredge-and-fill activity, required project-level personnel to ensure that particular activities would not have more than a minimal impact on the aquatic environment. These were additional safeguards, and the Tenth Circuit found no error in the Corps’ delegation.

Finally, the Tenth Circuit addressed the environmental groups’ argument that the Corps violated the terms of its own permit by failing to document analysis of cumulative impacts in the verification letters or administrative record. The Tenth Circuit found no error. Although the district engineers were required to analyze cumulative impacts, they need not document their analysis in the verification letters. The Tenth Circuit noted that although the letters did not contain the analysis, it appeared in the record, and the Corps’ issuance of the verifications was not arbitrary or capricious.

The Tenth Circuit affirmed the district court’s judgment.

Tenth Circuit: Environmental Groups’ CWA and NEPA Challenges to US Army Corps of Engineers § 404 Permit Issuance Fail

The Tenth Circuit issued its opinion in Hillsdale Envtl. Loss Prevention, Inc. v. US Army Corps of Engineers on Wednesday, November 28, 2012.

Several environmental groups (collectively, Hillsdale) brought challenges to a dredge and fill permit issued by the United States Army Corps of Engineers (Corps) under the Clean Water Act (CWA), 33 U.S.C. §§ 1251–1387, and the National Environmental Policy Act (NEPA), 42 U.S.C. §§ 4321–4370H. The Burlington Northern Santa Fe (BNSF) sought the permit to build a new rail/truck terminal near Kansas City. The district court denied Hillsdale’s motion for an injunction and granted summary judgment for the Corps and BNSF.

The Tenth Circuit first determined that Hillsdale’s NEPA claims were not prudentially moot. Because the new facility was not yet complete, if the court found the Corps’s environmental assessment was defective and remanded, the Corps could require additional mitigation or make other changes to the permit.

The Tenth Circuit then reviewed the challenge to the § 404 Clean Water Act permit. A properly issued permit requires a determination by the Corps that “there is ‘no practicable alternative’ to the proposed activity ‘which would have less adverse impact on the aquatic ecosystem.’” The Corps had reviewed seven alternative sites and rejected them all. The Tenth Circuit held that to rebut the presumption that an eliminated alternative was available, the Corps need not provide a specific level of detail for each, but must take “a hard look at the proposals and reach[] a meaningful conclusion based on the evidence.” Given the minor to moderate anticipated impact to the affected waters, the Corps did not have to extensively document why each eliminated alternative was impracticable and had met the required standard.

The court also rejected Hillsdale’s argument that the Corps had a duty to identify additional practicable sites that did not contain jurisdictional waters. To be practicable, an alternative site would have to satisfy BNSF’s site selection criteria, which included a 30-mile limit from its existing site. The Corps had identified seven additional sites within this limited geographical area and rejected them all. Hillsdale failed to identify an alternative within this area that the Corps failed to review.

Hillsdale also argued that the Corps failed in its duty to independently evaluate BNSF’s site selection criteria, particularly the 30-mile limit. The court found the Corps had questioned the criteria and that it was not entitled to reject BNSF’s study-based determination that a site outside the limit would have an economic impact on its customers.

The Tenth Circuit held that the Corps successfully rebutted the presumption that less environmentally damaging practicable alternatives to the selected site existed, and its CWA analysis was not arbitrary and capricious.

Hillsdale challenged the Corps’s failure to prepare an environmental impact statement under NEPA after conducting an environmental assessment. BNSF had entered into an agreement with the Kansas Department of Health and Environment requiring it to monitor dust emissions and mitigate them if they exceeded specified levels. The court affirmed the Corps’s finding of no significant impact from fugitive dust emissions because of this agreement. The court also rejected Hillsdale’s challenge to the Corps’s handling of other air emissions and its lack of an EIS concerning water pollution to a lake and wells in the area. The court affirmed the district court and upheld the Corps’s issuance of the § 404 permit.