REVISED, April 23, 1998
IN THE UNITED STATES COURT OF APPEALS
FOR THE FIFTH CIRCUIT _______________
No. 96-60874 _______________
AMERICAN FOREST AND PAPER ASSOCIATION,
Petitioner,
VERSUS
UNITED STATES ENVIRONMENTAL PROTECTION AGENCY,
Respondent.
_________________________
Petition for Review of an Order of the Environmental Protection Agency _________________________ March 30, 1998
Before JONES and SMITH, Circuit Judges, and FITZWATER,* District Judge.
JERRY E. SMITH, Circuit Judge:
Pursuant to the Clean Water Act (“CWA”), 33 U.S.C. § 1251
et seq., the Environmental Protection Agency (“EPA”) delegated to
Louisiana the responsibility for administering the Louisiana
Pollutant Discharge Elimination System (“LPDES”). In exchange for
its approval, EPA required Louisiana to consult with the Fish and
Wildlife Service (“FWS”) and the National Marine Fisheries Service
(“NMFS”) before issuing permits. If FWS or NMFS determines that
* District Judge of the Northern District of Texas, sitting by designation. the proposed permit threatens endangered speciesSSand if Louisiana
refuses to modify the permitSSEPA will veto the permit under its
continuing oversight authority. American Forest and Paper
Association (“AF&PA”) challenges this rule as exceeding EPA's
authority under the CWA. Because we agree that EPA lacked
statutory authority, we grant the petition for review and vacate
and remand the portion of the rule that imposes the consultation
requirement and declares that EPA will veto any permit to which FWS
or NMFS objects.
I.
Under the CWA, one needs a permit to discharge a pollutant.
At least as an initial matter, permitting authority is vested in
EPA through the National Pollutant Discharge Elimination System
(“NPDES”). EPA may, however, delegate permitting authority to a
state if the state demonstrates that it will comply with a list of
enumerated requirements and that it will monitor and enforce the
terms of the permits. See CWA § 402(b)(1)-(9), 33 U.S.C.
§ 1342(b)(1)-(9). EPA does not enjoy wide latitude in deciding
whether to approve or reject a state's proposed permit program.
“Unless the Administrator of EPA determines that the proposed state
program does not meet [the specified] requirements, he must approve
the proposal.” Save the Bay, Inc. v. EPA, 556 F.2d 1282, 1285 (5th
Cir. 1977).
EPA retains oversight authority even when it delegates
permitting authority to a state. Should the agency determine that
2 a state is not complying with the CWA, it may withdraw its approval
of the state program. EPA also retains oversight authority over
individual permits issued under approved state programs. States
are required to submit permit applications and proposed permits to
EPA; the agency may veto a proposed permit if it concludes that the
permit violates the CWA. See CWA § 402(d), 33 U.S.C. § 1342(d).
Until recently, EPA administered the permitting program in
Louisiana through the NPDES. Before issuing a permit, EPA chose to
consult with FWS and NMFS to ensure that endangered species would
not be threatened by the discharges contemplated in the permit.
When EPA announced plans to delegate the permitting program to
Louisiana, environmental groups cried foul, pointing out that
because the Endangered Species Act (“ESA”) does not apply to the
states, nothing would prevent the issuance of permits that might
harm endangered species.
EPA then devised the following scheme: In exchange for
approving Louisiana's program, EPA directed the Louisiana
Department of Environmental Quality (“LDEQ”) to submit proposed
permits to FWS and NMFS for review. If the federal agencies agree
that the proposed permit does not threaten endangered species, the
permit may be issued. But if the federal agencies conclude that
the permit does threaten endangered speciesSSand if LDEQ refuses to
modify the permit to the agencies' satisfactionSSEPA will exercise
its veto power and formally object to the permit. Louisiana
consented to this arrangement, and EPA issued its final rule. See
Approval of Application by Louisiana To Administer the National
3 Pollutant Discharge Elimination System Program, 61 Fed. Reg. 47,932
(1996).
EPA invoked CWA § 304(i), 33 U.S.C. § 1314(i), as authority
for attaching this condition to its approval of Louisiana's
program. That section allows EPA to promulgate guidelines
“establishing the minimum procedural and other elements” for state
permitting programs. The agency also pointed to ESA § 7(a)(2) as
justifying its action. That section provides:
Each Federal agency shall, in consultation with and with the assistance of the Secretary [of the Interior, Commerce, or Agriculture], insure that any action authorized, funded, or carried out by such agency . . . is not likely to jeopardize the continued existence of any endangered species or threatened species or result in the destruction or adverse modification of habitat of such species . . . .
16 U.S.C. § 1536(a)(2). The spirit of this general mandate is
echoed in the statement of congressional purpose underlying the
ESA, 16 U.S.C. § 1531(c)(1), which declares it “the policy of
Congress that all Federal departments and agencies shall seek to
conserve endangered species and threatened species and shall
utilize their authorities in furtherance of the purposes of this
chapter.”
II.
AF&PA did not participate in the agency proceedings belowSSa
silence that EPA says precludes AF&PA from raising its objection in
this court. The CWA grants the federal courts of appeals original
jurisdiction over challenges to determinations regarding state
permitting programs under § 402(b). Although any “interested
4 person” may seek review of EPA's permitting decisions, see CWA
§ 509 (b)(1), 33 U.S.C. § 1369(b)(1), EPA argues that a party that
fails to participate during the public comment period waives its
claims. The agency points to its extensive newspaper advertising
as evidence that AF&PA was on notice of EPA's intent to approve
Louisiana's program.
EPA has failed to identify any provision in the CWA that
suggests a party's failure to comment waives its right to seek
judicial review. The statute allows “any interested person” that
promptly files an objection to seek review in this court. Other
statutes allowing judicial review of agency decisions sweep far
less broadly, requiring the petitioner to have been a party. See,
e.g., 28 U.S.C. § 2344 (limiting right of review to “aggrieved
parties”). We see nothing in the text of the statute that warrants
the narrow reading EPA urges.
Moreover, we have never held that failure to raise an
objection during the public notice and comment period estops a
petitioner from raising it on appeal. EPA presented the same
argument to us long ago, but we rejected it, observing that “EPA
has cited no authority for the proposition that an argument not
raised during the comment period may not be raised on review.”
City of Seabrook, Tex. v. EPA, 659 F.2d 1349, 1360 n.17 (Former 5th
Cir. Oct. 1981). In that case, EPASSas it does again hereSSrelied
on United States v. L.A. Tucker Truck Lines, Inc.,
344 U.S. 33 (1952), involving a challenge to an Interstate Commerce
Commission action by a party that participated in a hearing and
5 could have appealed the hearing officer's decision to the
Commission. We characterized EPA's reliance on L.A. Tucker as
“badly misplaced.” City of Seabrook, 659 F.2d at 1360 n.17.
We conclude that AF&PA's failure to participate during the
public comment period does not rob this court of jurisdiction. Our
decision in City of Seabrook remains valid:
The rule urged by EPA would require everyone who wishes to protect himself from arbitrary agency action not only to become a faithful reader of the notices of proposed rulemaking published each day in the Federal Register, but a psychic able to predict the possible changes that could be made in the proposal when the rule is finally promulgated. This is a fate this court will impose on no one.
Id. at 1360-61 (internal footnotes omitted). Estopping AF&PA from
pursuing its claims would be especially unfair in that EPA modified
its rule. The version initially proposed did not contain the
consultation requirement; that provision was added only after
environmental groups demanded additional protection for endangered
species. AF&PA's failure to monitor the rule's evolution
throughout the public comment period does not constitute waiver.
Finally, we note that the concerns underlying the exhaustion
doctrine are not implicated here. That doctrine restrains courts
from ruling on objections not considered by the agency by requiring
a party to exhaust its administrative remedies before pursuing
judicial review. See Unemployment Compensation Comm'n v. Aragon,
329 U.S. 143, 155 (1946). During the public comment period, EPA
was presented with detailed objections concerning the scope of
6 endangered species protection under Louisiana's proposed program.2
(To be sure, these objections came from environmental groups
seeking expanded protections, so it is ironic that AF&PA now seeks
to preserve its claim on the basis of its opponents' complaints.)
In any event, because the public comments regarding the ESA were
sufficiently specific to prompt EPA to adopt the provision
contested here, the agency cannot reasonably claim that it has been
denied the opportunity to consider the issue.
III.
Before we can reach the merits of its claim, AF&PA must
demonstrate that it has standing to sue. It must first show that
it has suffered an “injury in fact”SSthat is, an actual and
imminent injury, not one that is merely conjectural or
hypothetical. It also must show a causal connection between its
injury and the complained-of conduct. Finally, it must establish
that its injury is likely to be redressed by a favorable decision.
Bennett v. Spear, 117 S. Ct. 1154, 1163 (1997). EPA claims that
AF&PA cannot meet any of these requirements.
A.
AF&PA's members include permit holders in Louisiana. Although
AF&PA has not alleged that any of its members has applied for a new
permit or sought to modify an existing one, it argues that injury
2 For example, an environmental group from Tulane Law School specifically charged that “the Endangered Species Act will become unavailable to citizens if [the Louisiana] DEQ becomes the administrator of the NPDES program.”
7 is imminent, in the form of costs of compliance with EPA's new
rule, including delays in permitting and the added risk that an
application will be denied. EPA says AF&PA's alleged injury is
purely hypothetical, because it rests on a chain of speculation.
In EPA's view, this chain is linked by a series of dubious
assumptions about the circumstances under which EPA might exercise
its veto power.
We do not find the permit holders' injuries speculative. As
an initial matter, permits are not eternal: They must be renewed
every five years. Modifications to existing permits must also be
cleared with FWS and NMFS. Moreover, EPA has already identified
the circumstances under which it will veto a proposed permit. See
61 Fed. Reg. at 47,934 (“EPA will formally object to the issuance
of the draft permit if FWS determines that the action is likely to
jeopardize the continued existence of a listed or proposed species
or destroy designated critical habitat.”) (emphasis added). Permit
holders' imminent need to comply, coupled with EPA's frank
announcement of its intentions, belies the agency's claim that any
injury is speculative.3
B.
EPA next launches a redressability challenge, contending that
Louisiana's voluntary commitment to cooperate with the federal
agencies would withstand a court decision striking down the rule's
3 EPA's claim that AF&PA has not shown causationSSa link between the agency's decision and the permit holders' injury-in-factSSis also premised on the allegedly speculative nature of the injury. It fails for the same reason.
8 consultation requirement. EPA correctly points out that Louisiana
is free to consult with FWS and NMFS in making permitting
decisions. But this argument misses the real question: whether EPA
may promulgate a rule requiring Louisiana to obtain the federal
government's blessing before issuing a permit. In this instance,
a permissible end does not validate impermissible means. EPA's
redressability challenge, accordingly, is meritless.
IV.
The final threshold issue is ripeness. In determining whether
an issue is ripe for review, we must balance the fitness of the
issues for judicial decision with the hardship to the parties of
withholding review. Chevron U.S.A., Inc. v. Traillour Oil Co.,
987 F.2d 1138, 1153-54 (5th Cir. 1993) (“[T]he ripeness inquiry
focuses on whether an injury that has not yet occurred is
sufficiently likely to happen to justify judicial intervention.”).
Ordinarily we wait until a rule has been applied before granting
review; this prudential concern loses force, however, when the
question presented is purely legal. New Orleans Pub. Serv., Inc.
v. Council of City of New Orleans, 833 F.2d 583, 587 (5th Cir.
1987).
The instant case concerns a purely legal issue: whether EPA
enjoys the statutory authority to require Louisiana, before it may
issue a discharge permit, to consult with federal agencies
regarding the impact on endangered species. Contrary to EPA's
assertion, there are no facts awaiting development that would aid
9 our decision; to the extent any factual questions even exist, they
are overshadowed by the legal question that towers over this case.
Because deferring review will impose an immediate, significant
burden on the petitionerSSand because we are confronted with a pure
question of lawSSthis dispute is ripe for review.
V.
EPA contends that its rule is authorized by CWA § 304(i),
33 U.S.C. § 1314(i), which directs EPA to promulgate guidelines
governing state permitting programs under CWA § 402(b), 33 U.S.C.
§ 1342(b). EPA also suggests that its decision is not only
authorized but compelled by ESA § 7(a)(2), 16 U.S.C. § 1536(a)(2).
That section directs federal agencies to consult with FWS and NMFS
before undertaking any “agency action,” to ensure that the action
will not threaten an endangered species.
We review EPA's interpretation of the CWA in two steps.
Chevron U.S.A., Inc. v. Natural Resources Defense Council, 467 U.S.
867 (1984). We first ask whether Congress has directly spoken to
the precise question at issue. If so, we must defer to the clearly
expressed congressional intent. If notSSif the statute is silent
or ambiguousSSwe ask whether the agency's interpretation is based
on a permissible construction of the statute. Id. at 842-43. We
do not, however, accord Chevron deference to EPA's interpretation
of the ESA, because the ESA is not a statute that EPA is charged
10 with administering. See Adams Fruit Co. v. Barrett, 494 U.S. 638,
649-50 (1990).
Specifically, CWA § 402(b), 33 U.S.C. § 1342(b), provides that
the EPA Administrator “shall approve” proposed state permitting
programs that meet nine specified requirements. The key question
is whether EPA may deny a state's proposed program based on a
criterionSSthe protection of endangered speciesSSthat is not
enumerated in § 402(b).
EPA calls our attention to CWA § 304(i), 33 U.S.C. § 1314(i),
construing that section as authorizing the agency to regard the
nine requirements § 402(b) as minimum, not exhaustive, criteria.4
EPA further contends that because nothing in § 402(b) prohibits EPA
from adding additional criteria, its interpretation of the statute
is reasonable and worthy of deference under Chevron.
We cannot agree. The language of § 402(b) is firm: It
provides that EPA “shall” approve submitted programs unless they
fail to meet one of the nine listed requirements. We interpreted
this language as non-discretionary in Save the Bay, Inc. v. EPA,
556 F.2d 1282 (5th Cir. 1977), noting that “[t]he Amendments [to
the CWA] set out the full list of requirements a state program must
meet . . . . Unless the Administrator of EPA determines that the
4 Section 304(i) provides: “The Administrator shall . . . promulgate guidelines establishing the minimum procedural and other elements of any State program under Section 1342 of this title which shall include . . . monitoring requirements . . . reporting requirements . . . enforcement provisions; and . . . funding, personnel qualifications, and manpower requirements . . . .”
11 proposed state program does not meet these requirements, he must
approve the proposal.” Id. at 1285 & n.3. See also Natural
Resources Defense Council v. EPA, 859 F.2d 156, 174 (D.C. Cir.
1988); Citizens for a Better Env't v. EPA, 596 F.2d 720, 722 (7th
Cir. 1979).
EPA's claim is further weakened by CWA § 402(b)(6), 33 U.S.C.
§ 1342(b)(6), which grants EPA veto power over a proposed permit if
the Secretary of the Army concludes that the discharges
contemplated by the permit would substantially impair anchorage and
navigation. Congress could have, but did not, grant EPA an
analogous veto power to protect endangered species.
Nothing in § 304(i) undermines this conclusion. That
subsection simply directs EPA to issue regulations governing the
approval process for state programs. There is no hint that
Congress intended to grant EPA authority to erect additional
hurdles to the permitting process beyond those expressly noted in
§ 402(b). Moreover, neither section even mentions endangered
species or the ESA.5 The statute's plain language directs EPA to
approve proposed state programs that meet the enumerated criteria;
particularly in light of the command “shall approve,” § 304(i)
cannot be construed to allow EPA to expand the list of permitting
requirements. Applying Chevron, we conclude that Congress has
spoken directly to the precise question at issue: EPA's discretion
lies not in modifying the list of enumerated criteria, but simply
5 EPA's own regulations identifying the grounds on which the agency might object to state permits are similarly silent: They make no mention of protection of endangered species. See 40 C.F.R. § 123.44(c).
12 in ensuring that those criteria are met.
C.
In American Iron & Steel Inst. v. EPA, 115 F.3d 979 (D.C. Cir.
1997) (“AISI”), the court concluded that EPA may require states to
include provisions in certain permitting programs to ensure the
protection of endangered species. EPA argues that AISI's logic is
applicable to the instant case.
AISI is distinguishable, however, in that the case arose under
a different provision of the CWASS§ 118(c)(2), 33 U.S.C.
§ 1268(c)(2). That section directs EPA to promulgate “water
quality guidance” for the Great Lakes. But § 118(c)(2) is
structured quite differently from § 402: The former grants EPA
authority to specify pollutant limits for the Great Lakes and
develop “guidances” to which state programs must conform; the
section does not direct the agency to approve state programs that
meet certain requirements.
In addition to this far broader grant of authority,
§ 118(c)(2) specifically mentions that EPA's development of
pollutant limits should aim to protect aquatic life and wildlife in
the Great Lakes. The AISI court relied on this language in
concluding that EPA did not exceed its statutory authority under
§ 118(c):
We uphold this portion of the Guidance, but not because of the ESA. Section 118(c)(2) provides that the Guidance “shall specify numerical limits on pollutants in ambient Great Lakes waters to protect human health, aquatic life, and wildlife, and shall provide guidance to the Great Lakes States on minimum water quality standards . . . .”
13 (emphasis added) This is all the authority the EPA needed to promulgate regulations designed to protect endangered, threatened and other species in the Great Lakes System.
115 F.3d at 1003. AISI's reasoning, insofar as it concerns a
section of the CWA that materially differs in language and purpose,
is inapplicable here.
D.
Finally, EPA argues that ESA § 7(a)(2), when construed
alongside the Court's broad reading of the statute in Tennessee
Valley Auth. v. Hill, 437 U.S. 153, 173 (1978), compels EPA to do
everything reasonably within its power to protect endangered
species. The flaw in this argument is that if EPA lacks the power
to add additional criteria to CWA § 402(b), nothing in the ESA
grants the agency the authority to do so. Section 7 of the ESA
merely requires EPA to consult with FWS or NMFS before undertaking
agency action; it confers no substantive powers.6
The District of Columbia Circuit construed ESA § 7(a)(2) in
Platte River Whooping Crane Trust v. Federal Energy Regulatory
Comm'n, 962 F.2d 27 (D.C. Cir. 1992), holding that the statute
“does not expand the powers conferred on an agency by its enabling
act,” but rather directs the agencies to “utilize” their existing
powers to protect endangered species. Id. at 34. In that case,
6 Whether EPA's approval of Louisiana's permitting program constitutes “agency action” for ESA purposes is largely beside the point. Even if EPA were required to consult with the agencies before approving Louisiana's program, EPA lacks authority to modify the plain language of the CWA by adding to the list of enumerated requirements.
14 the petitioner, Whooping Crane Trust, pressed virtually the same
argument EPA advances here. The court observed:
The Trust reads section 7 essentially to oblige the [Federal Energy Regulatory Commission] to do “whatever it takes” to protect the threatened and endangered species that inhabit the Platte River basin; any limitations on FERC's authority contained in the [Federal Power Act] are implicitly superseded by this general command. . . . We think the Trust's interpretation of the ESA is far- fetched.
Id. We agree that the ESA serves not as a font of new authority,
but as something far more modest: a directive to agencies to
channel their existing authority in a particular direction. The
upshot is that EPA cannot invoke the ESA as a means of creating and
imposing requirements that are not authorized by the CWA.
Accordingly, we GRANT the petition for review and VACATE the
portion of the rule that imposes the consultation requirement and
declares that EPA will reject any proposed permit to which FWS or
NMFS objects. This matter is REMANDED to the EPA for further
appropriate proceedings.7
7 The Motion of Amici Curiae for Clarification or Partial Reconsideration is denied as moot.