All Projects Being Constructed Under Nationwide Permit 12 at Risk

Saul Ewing Arnstein & Lehr LLP

Saul Ewing Arnstein & Lehr LLP

Did the Army Corps of Engineers (Corps) violate the National Environmental Policy Act (NEPA) by not engaging with U.S. Fish and Wildlife in an Endangered Species Act (ESA) consultation prior to reauthorizing Nationwide Permit 12 in 2017, and does that mean that all projects currently being planned or constructed under NWP 12 are at risk?

A judge for the United States District Court for the District of Montana answered “yes” to the first question by entering a sweeping order that sent the general permit back to the Corps for a do-over, leaving the answer to the second question uncertain. As a result, the Corps once again finds itself in the midst of not simply the Keystone XL pipeline controversy, but a much larger battle, which has broader implications for the agency’s general permitting process in the face of competing interests under the ESA, the Clean Water Act (CWA) and NEPA.

Nationwide permits, like all environmental general permits, authorize the Corps to issue a single permit to cover similar minor activities. Coverage is deemed to apply once the applicant demonstrates its proposed activities are covered by the relevant nationwide permit. In the case of pipelines, including the Keystone XL Pipeline, the relevant nationwide permit is number 12, which covers utility line crossings impacting not greater than one-half of an acre of wetlands or waters of the United States.

On April 15, 2020, Judge Brian Morris vacated and remanded to the Corps Nationwide Permit 12 because he found that when performing an environmental assessment and issuing the permit in 2017 the agency failed to adequately consider the permit’s impact on endangered species, including the pallid sturgeon and the American burying beetle.

In remanding the permit to the Corps for a do-over of its environmental assessment, which will require consultation with U.S. Fish and Wildlife, the court stated that in 2017 “the Corps failed to consider relevant expert analysis and failed to articulate a rational connection between the facts it found and the choice it made.”

Judge Morris rejected the Corps’ reliance upon General Condition 18 of all nationwide permits as the basis for satisfying the ESA and NEPA. The condition instructs non-federal permittees to submit a PCN to the district engineer if the permittee believes that its activity “might” affect listed species or critical habitat. 82 Fed. Reg. at 1999-2000. Based on the PCN, the Corps can then trigger consultation with U.S. Fish and Wildlife for the project.

The Corps cannot circumvent ESA Section 7(a)(2) consultation requirements by relying on project-level review on General Condition 18. See 82 Fed .Reg 1999; Conner v. Burford, 848 F.2 1441, 1457-58 (9th Cir 1988). Project level review does not relieve the Corps of its duty to consult on the issuance of nationwide permits at the programmatic level. The Corps must consider the effect of the entire agency action...The Corps failed to fulfill that duty when it reissued NWP12 in 2017.

Given the general nature of nationwide permits, the NEPA evaluation associated with coverage has historically been less cumbersome than for individual permit applications. If Judge Morris’ decision, which is expected to be challenged, stands, it could serve as a basis for other courts to vacate and remand other nationwide permits applicable to development of all kinds, including commercial real estate, renewable energy projects and power plants. This would make project development more costly, challenging, time consuming and uncertain at a time when infrastructure development is being touted as a solution to the economic tailspin confronting the nation.

DISCLAIMER: Because of the generality of this update, the information provided herein may not be applicable in all situations and should not be acted upon without specific legal advice based on particular situations.

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