Update: SCOTUS Allows Atlantic Coast Pipeline to Cross Appalachian Trail

Miles & Stockbridge P.C.

Update: The two energy companies constructing the Atlantic Coast Pipeline have abandoned their six-year bid to build it. Despite the recent US Supreme Court win we discuss below, the companies cite high costs and regulatory uncertainty behind their decision to discontinue the project.

The Atlantic Coast Pipeline is a planned $8 billion, 600-mile natural gas pipeline from West Virginia to North Carolina. Petitioner Atlantic Coast Pipeline, LLC seeks to build the pipeline, which would traverse 21 miles of national forests and require the crossing of 57 rivers, streams and waterways in those forests.

At issue before the Supreme Court, in a major environmental case of this term, were two consolidated cases decided by the Fourth Circuit. The cases involved a 2017 special use permit granted by the United States Forest Service (“Forest Service”) to allow the Atlantic Coast Pipeline to cross the George Washington National Forest in Virginia. The permit authorized construction of a tunnel 600 feet beneath a 0.1-mile segment of the Appalachian Trail. The Fourth Circuit held that the Appalachian Trail became part of the National Park System when the Secretary of the Interior delegated its authority over the trail’s administration to the National Park Service (“Park Service”). According to the Fourth Circuit, this delegation means that the Mineral Leasing Act’s prohibition on pipeline rights-of-way through National Park Service land applies.

On June 15, 2020, the Supreme Court reversed the Fourth Circuit and ruled 7-2 that the Forest Service had authority to issue the permit over the trail. The Park Service administers the Appalachian Trail, even where the trail runs through national forests. The trail has been an official “unit” of the Park Service for fifty years, but that status alone, now, does not prohibit construction of natural gas pipelines under the Mineral Leasing Act. The question before the Supreme Court was whether the entire Appalachian Trail is such a “land” as defined by the Mineral Leasing Act.

The Court ruled that the Park Service had an easement under the 1968 National Trails System Act (“1968 Act”) to run a footpath over the trail, but the trail itself remained fully under the jurisdiction of the Forest Service. Justice Thomas, writing for the 7-justice majority, reasoned that under established principles of property law, a right-of-way grants only nonpossessory limited rights of use. It does not constitute a transfer of ownership. The Court further cautioned that the respondents’ theory – that delegation of the administration of the Appalachian Trail includes jurisdiction over the lands the Appalachian Trail crosses – would constitute a “vast expansion” of the Park Service’s jurisdiction and have “striking implications” for federalism and private property rights. This is because the 21 national scenic trails cross lands held by states, local governments, and private landowners. The Court was not willing to consider such a dramatic expansion absent a clear congressional command.

Justice Sonia Sotomayor and Justice Elena Kagan argued in dissent that the majority’s private-law easement analogies were unconvincing and inapposite. Easements are rights of limited access granted by a landowner to another, but the federal government owns all the land at issue in this case. So, federal statutory commands, not private-law analogies, should govern. The dissenting Justices argued that the majority improperly separated the trail from the land it occupies. The Park Service administers the trail, and therefore, it must also administer the land upon which the trail sits. The Secretary of the Interior had already delegated responsibility for trail administration to the Park Service when Congress passed a 1970 statute making all lands administered by the Park Service part of the National Park System. In the dissent’s view, the majority did not construe the relevant statutes in a way that effectuated what Congress intended.

This decision removes major obstacles to constructing the Atlantic Coast Pipeline. If the Fourth Circuit decision had been upheld, the pipeline likely would have had to be rerouted, resulting in tremendous expense and delay. Other obstacles to the pipeline remain, however, as the Fourth Circuit has vacated several other permits required for the project.

U.S. Forest Service v. Cowpasture River Pres. Ass’n, 2020 WL 3146692, -- S. Ct. -- (June 15, 2020) (consolidated with Atl. Coast Pipeline LLC v. Cowpasture River Pres. Ass’n)

Opinions and conclusions in this post are solely those of the author unless otherwise indicated. The information contained in this blog is general in nature and is not offered and cannot be considered as legal advice for any particular situation. The author has provided the links referenced above for information purposes only and by doing so, does not adopt or incorporate the contents. Any federal tax advice provided in this communication is not intended or written by the author to be used, and cannot be used by the recipient, for the purpose of avoiding penalties which may be imposed on the recipient by the IRS. Please contact the author if you would like to receive written advice in a format which complies with IRS rules and may be relied upon to avoid penalties.

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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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