Restore et al v. US Dept. Agriculture CV-97-435-B 01/20/98
UNITED STATES DISTRICT COURT FOR THE DISTRICT OF NEW HAMPSHIRE
Restore: The North Woods, et a l ,
C-97-435-B
U. S. Department of Agriculture, et a l ,
MEMORANDUM AND ORDER
Loon Mountain Recreation Corporation ("Loon") operates the
Loon Mountain ski area. Because part of the ski area is located
in the White Mountain National Forest, Loon's operations require
a special use permit issued by the United States Department of
Agriculture ("DOA") through its subsidiary agency the United
States Forest Service ("Forest Service"). 16 U.S.C.A. § 497b
(West Supp. 1997). At issue in this case is the Forest Service's
approval of Loon's proposal to construct and operate a snow
making pipeline running from the East Branch of the Pemigewasset
River ("East Branch") to the top of Loon Mountain. Plaintiffs
argue that the Forest Service violated the National Environmental
Policy Act ("NEPA"), 42 U.S.C. § 4332 (c)(1) (1994), by (1)
approving the pipeline proposal without first conducting either
an Environmental Assessment ("EA") or an Environmental Impact
Statement ("EIS"); and (2) considering the pipeline's potential environmental impacts separately from other aspects of Loon's
expansion plan.
Plaintiff Restore: The North Woods ("Restore"), an environ
mental group with several members who live in the Loon Mountain
area, filed this action seeking to enjoin the Forest Service from
allowing Loon to construct and operate the pipeline. Restore has
been joined in its claims by interveners Roland C. Dubois, a
freguent visitor to the Loon Mountain area; James F. Miles, a
property owner at and freguent visitor to Loon Mountain; and
Slide Slope Realty Trust, a real estate trust owning property
adjacent to Loon Mountain. Loon has intervened as a defendant.
The matter initially came before me on plaintiffs' motions
for a temporary restraining order and a preliminary injunction.
At oral argument, however, all parties agreed to consider this
order the final determination on the merits. Therefore, I
determine plaintiffs' claim for permanent injunctive relief.
I. Background
A. Loon's Expansion Plan
Loon has sought to expand its operations for over a decade.
In 1993, the Forest Service issued a Record of Decision ("ROD")
approving an expansion plan described in the project's Final
Environmental Impact Statement ("FEIS") .1 The plan would have
1 The actual process was much more complex, drawn-out, and contentious than this summary would indicate. For a more detailed discussion of the project's background, see Dubois v. U.S. Dep't of Aqric., 102 F.3d 1273, 1277-80 (1st Cir. 1996). - 2 - allowed Loon to improve its existing facilities and expand onto
additional Forest Service land. In the existing permit area.
Loon would have widened established trails, added several new
trails and one new lift, and improved existing lifts and
restaurant facilities. In the new permit area. Loon would have
added a new lift and nine new trails. Loon would also have
constructed a new base lodge and an additional parking lot on
private land at the base of the new lift.
The plan would also have allowed Loon to significantly
expand its snow-making system by installing new snow-making pipes
and extending snow-making to all trails in both the existing and
new permit areas. Although Loon would have continued to use its
three pre-expansion water sources — the East Branch, Boyle Brook,
and Loon Pond — for its snow-making operations. Loon Pond would
have become its principle water source. Loon would have been
permitted to draw the pond down by as much as fifteen feet for
snow-making, and the Town of Lincoln, which had in the past used
the pond as a source for drinking water, would have been
permitted to draw the pond down by as much as five additional
feet. As a mitigation measure, the proposed expansion plan would
have reguired Loon to biannually refill the pond with water
pumped through its snow-making system from the East Branch. The
proposed expansion plan would also have imposed other restraints
on Loon's use of water from the East Branch and Loon Pond.
Dubois and Restore sued the Forest Service and Loon shortly
after the Forest Service issued the ROD, claiming that the Forest
- 3 - Service's consideration of the plan violated NEPA and that the
plan itself violated the Clean Water Act. I rejected both
claims, but the Court of Appeals reversed my decision. See
Dubois v. United States Dep't of Aqric., 102 F.3d 1273 (1st Cir.
1996). Accordingly, I issued a permanent injunc-tion on May 5,
1997 ("the May 5 Order") enjoining Loon from proceeding further
with its expansion plan without first complying with the Clean
Water Act and submitting the plan for NEPA review. As Loon had
already completed certain aspects of the plan, I allowed it to
use the new facilities until it could submit a revised expansion
plan. However, I limited Loon's right to withdraw water from
Loon Pond and barred it from discharging East Branch water into
the pond while the review was underway.
B. The Pipeline Proposal
With its expansion plan on hold, and its ability to with
draw water from Loon Pond restricted. Loon proposed to construct
a new snow-making pipeline to serve its existing facilities. The
pipeline, which has since been completed, runs from the East
Branch to the top of Loon Mountain, traveling within existing
trails and utility corridors and through a 50-foot patch of
trees. It gives Loon the capacity to pump up to 200 million
gallons of water per season. The pipeline is approximately 6,750
feet long, 4,500 feet of which runs underground, reguiring a
trench four feet deep and wide. Approximately 60 feet of the
above-ground portion reguired blasting to level the terrain.
Loon also constructed a new intake gallery and pumphouse at the
- 4 - East Branch on privately owned land to supply the pipeline with
water.
C. The CEO Regulations and the Forest Service Handbook
Because Loon operates on federal land pursuant to a special
use permit, it had to submit the pipeline proposal to the Forest
Service for approval. Federal agency approval of a construction
activity such as the pipeline qualifies as a "major federal
action" that triggers the NEPA process. 42 U.S.C.A. § 4332(c);
40 C.F.R. § 1508.18 (a) .
In enacting NEPA, Congress created the Council on Environ
mental Quality ("CEQ") in order to, among other things, "develop
and recommend to the President national policies to foster and
promote the improvement of environmental quality . . . ." 42
U.S.C.A. §§ 4342-4347 (1994). Pursuant to this mandate, the CEQ
has promulgated regulations with the avowed purpose of imple
menting NEPA's "action-forcing" measures. 40 C.F.R. § 1500.1(a)
see also 42 U.S.C.A. § 4731 et sea. (1994) . The regulations
broadly command federal agencies to interpret and administer all
laws, policies, and regulations in accordance with the policies
set forth in NEPA. 40 C.F.R. § 1500.2(a). They also "tell
agencies what they must do to comply with the procedures and
achieve the goals of [NEPA]." 40 C.F.R. §§ 1500.1, 1500.3; see
also Exec. Order No. 11,991, 42 Fed. Reg. 26967 (1977)
(commending all federal agencies to "comply with the [CEQ
regulations] except where such compliance would be inconsistent
with statutory requirements."). The CEQ regulations require agencies to follow a three-step
process when determining whether to prepare either an EA or an
EIS for proposed action. First, the agency must prepare an EIS
if the proposed action is one which normally requires an EIS. 40
C.F.R. § 1501.4(a)(1). If an EIS is not required at step one,
the agency must determine whether the action qualifies under a
"categorical exclusion." Id. § 1501.4(a) (2). A categorical
exclusion is "a category of actions which do not individually or
cumulatively have a significant effect on the human environment
and which have been found to have no such effect in procedures
adopted by a Federal agency in implementation of these
regulations." Id. § 1508.4. Further NEPA review ordinarily will
not be required if a proposed action appears to qualify for
categorical exclusion. However, the regulations require agencies
to develop procedures that provide for "extraordinary
circumstances" in which a normally excluded action will be
ineligible for exclusion because it "may have a significant
environmental effect." Id. If the need for an EIS cannot be
ruled out by determining that the proposed action qualifies for a
categorical exclusion, the agency must prepare an EA.2 Id. §
1501.4(b). The agency then must either prepare an EIS or issue a
"finding of no significant impact." Id. § 1501.4 (b)- (e),
2 The CEQ regulations define an EA as "a concise public document for which a Federal agency is responsible that serves to: (1) Briefly provide sufficient evidence and analysis for determining whether to prepare an environmental impact statement or a finding of no significant impact"; and "(2) Aid an agency's compliance with the Act when no environmental impact statement is necessary." 40 C.F.R. § 1508.9.
- 6 - 1508.13. In summary, the regulations require that any proposed
action must be reviewed either in an EA or an EIS unless it is
eligible for categorical exclusion. Diagram No. 1 provides a
visual depiction of this three-step process.
In determining whether a proposed action could have a
significant environmental impact, the CEQ regulations require an
agency to consider both the context in which the action will
occur and the intensity of any potential impacts resulting from
the action. 40 C.F.R. § 1508.27. In evaluating an impact's
intensity, an agency must consider "[w]hether the action is
related to other actions with individually insignificant but
cumulatively significant impacts. Significance exists if it is
reasonable to anticipate a cumulative significant impact on the
environment." Id. § 1508.27(b)(7). The regulations further
state that "significance cannot be avoided by terming an action
temporary or breaking it down into small component parts." Id.
Finally, the regulations define the term "cumulative impact" in
such a way as to require the agency to consider the impact of a
proposed action when it is "added to other past, present and
reasonably foresee-able future actions." Id. § 1508.7.
The CEQ regulations also require each agency to establish
policies and procedures to ensure that the regulations are
implemented in a consistent manner. Id. § 1507.3(a). The Forest
Service has complied with this requirement by establishing
environmental policies and procedures designed to provide
guidance for analyzing and documenting the environmental
- 7 - consequences of proposed actions. See 57 Fed. Reg. 43180, 43188
(1992). These policies and procedures are found in Section
1909.15 of the Forest Service Handbook ("FSH").
The FSH tracks the CEQ regulations in describing the method
for determining whether an EIS must be prepared. First, it
establishes four classes of actions that normally require an EIS.
FSH § 2 0.6; see 40 C.F.R. § 1501.4(a)(1). If a proposed action
does not fall within one of the classes of actions requiring an
EIS at step one, the FSH provides that the Forest Service must
determine whether the action is eligible for categorical
exclusion. See FSH § 30.3; 40 C.F.R. § 1501.4(a)(2). In this
regard, the FSH provides that a "proposed action may be
categorically excluded from documentation in [an EA or EIS] only
if the proposed action ... [i]s within [an applicable category]
and there are no extra-ordinary circumstances related to the
proposed action." FSH § 30.3.1(b). The FSH then lists several
categories of actions that will qualify for categorical
exclusions if no extraordinary circumstances are present. See
id. § 31.1(b) & 31.2. It also provides a non-exclusive list of
"extraordinary circumstances," FSH § 30.2, and defines the term
as " [c]onditions associated with a normally excluded action that
are identified during scoping as potentially having effects which
may significantly affect the environment." Id. § 30.5. Thus,
the FSH both recognizes certain specified circumstances that will
always qualify as extraordinary if they are "related" to the
proposed action, and provides for additional unspecified circumstances which may be considered extraordinary if the facts
suggest that the proposed action potentially may have a
significant impact on the environment. See id. §§ 30.2, 30.5.
D. The Decision Memo
On August 26, 1997, a District Ranger of the Forest Service
issued a Decision Memo concluding that the pipeline did not
reguire either an EA or an EIS because it was eligible for
categorical exclusion.3 Although she noted the presence of
several conditions listed in the FSH as "extraordinary
circumstances" — namely, steep slopes, erosive soils, wetlands,
and a municipal watershed — she concluded that "the mere presence
of these conditions does not preclude the use of categorical
exclusions so long as effects are not significant . . . ."
Decision Memo at DM-7. She then proceeded to address each
enumerated extraordinary circumstance and concluded that because
none of the circumstances would cause the pipeline to have a
significant impact on the environment, it could be categorically
3 Specifically, the District Ranger concluded that the pipeline could be excluded as " [a]dditional construction or reconstruction of existing telephone or utility lines in a designated corridor." Decision Memo at DM-7; FSH § 31.2.2. The Decision Memo states that with the exception of a 50-foot section, the new pipeline will lie within a utility corridor currently used for both a water supply pipeline and an electricity transmission line. Decision Memo at DM-7. Alternatively, the District Ranger concluded that the pipeline could be excluded as an "[a]pproval, modification, or continuation of minor special uses of National Forest System lands that reguire less than five contiguous acres of land." Id. at DM-7. "Examples include but are not limited to: ... Approving the use of land for a 40-foot utility corridor that crosses one mile of a National Forest." FSH § 31.2.3 (d). The Decision Memo notes that the pipeline would reguire only 0.62 acres of Forest Service land. Decision Memo at DM-7. excluded from the need for further review. Id. at DM-7-9.
The District Ranger also considered and rejected the
plaintiffs' argument that the pipeline proposal had to be
considered in conjunction with Loon's expansion plan. In
response to a public comment that the pipeline proposal was
"inexorably intertwined" with Loon's expansion plan, the District
Ranger noted that the two matters could be separately considered
because: "[a] review of the pipeline proposal shows that it is
independent of any potential expansion. If no expansion were
ever proposed, LMRC would still need to change its snow-making
system to allow it to comply with the May 5 order and still
maintain a competitive position in the ski resort business."
Decision Memo, Responses at 4-5.
Since Loon had already obtained all other permits and
approvals needed to construct the pipeline, it was free to begin
construction as soon as the Forest Service issued the Decision
Memo. By the time that the matter came before me for
consideration, the pipeline had been substantially completed.
I I. Analysis
A. Standard of Review
NEPA does not contain its own standard of review. There
fore, Section 10 of the Administrative Procedure Act, 5 U.S.C. §
701 et seg. (1996), governs the scope of judicial review of an
agency's compliance with NEPA. See Marsh v. Oregon Natural
Resources Council, 490 U.S. 360, 375 (1989); Sierra Club v.
- 10 - Marsh, 976 F.2d. 763, 769 (1st Cir. 1992) ("Sierra Club III").
Consequently, a reviewing court may hold unlawful an agency
action, finding, or conclusion only if it is "arbitrary,
capricious, an abuse of discretion, or otherwise not in
accordance with the law . . . ." Conservation Law Foundation,
Inc. v. Secretary of the Interior, 864 F.2d. 954, 957 (1st Cir.
1989) (quoting 5 U.S.C. § 706(2)(A)).
This standard is highly deferential and demands that the
reviewing court presume that an agency action is valid. Sierra
Club III, 976 F.2d. at 769 (citing Citizens To Preserve Overton
Park, Inc. v. Volpe, 401 U.S. 402, 415 (1971)). Before deferring
to an agency's decision the reviewing court must satisfy itself
that the agency has made a "reasoned decision based upon its
evaluation" of the available information. Oregon Natural
Resources Council, 490 U.S. at 378. More specifically, the First
Circuit requires that the reviewing court "look to see if the
agency decision, in the context of the record, is too
'unreasonable' (given its statutory and factual context) for the
law to permit it to stand." Sierra Club III, 976 F.2d. at 769
(emphasis omitted) (quoting Sierra Club v. Marsh, 769 F.2d 868,
871 (1st Cir. 1985) ("Sierra Club I")).
An agency's legal judgments are also entitled to deference
in certain instances. When an agency construes a statute or a
regulation that it is charged with administrating, the court must
defer to the agency's interpretation so long as it is not
- 11 - "manifestly contrary to the statute." 4 Clifton v. Federal
Election Commission, 114 F.3d 1309, 1318 (1st Cir. 1997) (quoting
Chevron U.S.A., Inc. v. Natural Resources Defense Council, 4 67
U.S. 837, 842-44 (1984)) (statute); Auer v. Robbins, 117 S. C t .
905, 911 (1997) (quoting Bowles v. Seminole Rock & Sand Co., 325
U.S. 410, 414 (1945))(regulation); Gioioso & Sons, Inc. v.
Occupational Safety & Health Review Commission, 115 F.3d 100, 107
(1st Cir. 1997). With these standards in mind, I first consider
plaintiffs' claim that the pipeline is ineligible for categorical
exclusion even if it is considered in isolation. I then address
their contention that the proposal should have been evaluated
together with Loon's expansion plan.
B. Categorical Exclusion
Plaintiffs offer both legal and factual arguments to support
their claim that the Forest Service improperly excluded the
pipeline from further environmental review. First, they argue
that the pipeline is ineligible for exclusion because the
District Ranger found that extraordinary circumstances were
"present" and the mere presence of such circumstances makes an
4 Certain agency actions may constitute nothing more than statements of policy that are not binding on the agency. See Chrysler Corp. v. Brown, 441 U.S. 281, 302 (1979) . The Ninth Circuit has determined that the Forest Service need not comply with the FSH because it is a policy manual that does not have the force and effect of law. Southwest Center for Biological Diversity v. United States Forest Service, 100 F.3d 1443, 1450 (9th Cir. 1996); Western Service Radio Services, Inc. v. ESPY, 79 F.3d 896, 901 (9th Cir. 1996). I do not address this difficult issue here because defendants do not argue that the relevant provisions of the FSH lack the force and effect of law. - 12 - action ineligible for exclusion as a matter of law. Second, they
argue that the District Ranger abused her discretion in finding
that the construction and operation of the pipeline would have no
significant impact on the environment. I address each argument
in turn.
1. Plaintiffs' Legal Argument
The FSH permits the Forest Service to rely on a categorical
exclusion "only if the proposed action . . . [i]s within [an
applicable category] and there are no extraordinary circumstances
related to the proposed action." FSH § 30.3.1(b) (emphasis
added). Plaintiffs apparently assume that extraordinary circum
stances are "related" to a proposed action if they are "present."
Accordingly, they argue that the pipeline proposal is ineligible
for categorical exclusion because the District Ranger conceded
that extraordinary circumstances were present at the pipeline
site.
The Forest Service, in contrast, asserts that an action may
be categorically excluded even if extraordinary circumstances are
present so long as the circumstances could not cause the proposed
action to have a potentially significant impact on the environ
ment. Although it has not offered a hermeneutical justification,
its position depends upon a different understanding of the term
"related." Under this interpretation, extraordinary
circumstances would not be related to a proposed action unless
they could cause the action to have a potentially significant
impact on the environment.
- 13 - I am not free to choose a preferred interpretation in
resolving this dispute. Instead, the Forest Service's
construction must be accepted unless it is manifestly erroneous.
See e.g., Auer v. Robbins, 117 S. C t . at 911. This forgiving
standard is easily satisfied here. First, the Forest Service's
interpretation is consistent with the categorical exclusion
process established by the CEQ regulations. These regulations
reguire only that "any procedures under this section shall
provide for extraordinary circumstances in which a normally
excluded action may have a significant environmental impact." 40
C.F.R. § 1508.4. They do not in any way prohibit an agency from
reguiring that extraordinary circumstances must cause a proposed
action to have a potentially significant environmental impact
before such circumstances could prevent the action from
gualifying for categorical exclusion.
Second, the Forest Service's interpretation is consistent
with the language and purpose of the FSH's categorical exclusion
procedures. The term "related" is commonly understood to mean
"connected by reason of an established or discoverable relation."
Webster's Third International Dictionary (1993) at 1916. It is
certainly plausible to argue that the mere presence of extra
ordinary circumstances at the site of a proposed action is
sufficient to gualify the circumstances as "related." However,
it is egually plausible to reguire that an extraordinary
circumstance must cause a proposed action to potentially have a
significant environmental impact before it could be sufficiently
- 14 - connected to the proposed action to be deemed "related." This
argument is even more persuasive when it is considered in the
context of the EIS process as a whole. The overriding purpose of
this process is to force agencies that must approve a proposed
action to consider its potentially significant environmental
impacts. See, Robertson v. Methow Valiev Citizens Council, 490
U.S. 332, 349 (1989). This purpose would be fully served by
adopting a categorical exclusion procedure that permits actions
to be eligible for exclusion so long as no extraordinary
circumstances could cause the action to have a significant impact
on the environment.
Finally, the drafting history of the FSH's categorical
exclusion procedure supports the District Ranger's
interpretation. The Forest Service attempted to revise its
categorical exclusion procedure in 1991. The proposed revisions
provided in pertinent part that: "[a] proposed action may be
categorically excluded from documentation in an [EA or an EIS]
only if the proposed action . . . (b) Falls within [an applicable
category]; and (c) Does not involve any extraordinary circum
stances." 56 Fed. Reg. 19718, 19743 (1991) (emphasis added).
The current categorical exclusion procedure, with its reguirement
that the extraordinary circumstances must be "related" to the
proposed action, was adopted in 1992 in response to public
comments on the 1991 proposal. In explaining why it had modified
the 1991 proposal, the Forest Service stated that it was
responding to concerns that "'extraordinary circumstances' were
- 15 - not well defined [in the 1991 proposal] and the mere presence or
absence of one of the listed circumstances was insufficient to
determine if an action was or was not to be placed in a category
for exclusion." 57 Fed. Reg. 43183 (emphasis added). This
statement suggests that the Forest Service adopted the "related"
reguirement in order to clarify its position that more than the
mere presence of extraordinary circumstances was reguired before
a proposed action could become ineligible for categorical
exclusion.
In summary, the Forest Service's construction of its
categorical exclusion procedure is not manifestly incorrect. No
more is reguired to uphold the District Ranger's interpretation
in this case. See, e.g.. Southwest Center for Biological
Diversity, 100 F.3d at 1450 (Forest Service may categorically
exclude proposed action even though extraordinary circumstances
are present if the proposed action will not have a significant
environmental impact); Southwest Center for Biological Diversity
v. Glickman, 939 F. Supp. 1189, 1195 (D. Ariz. 1996) (same);
Mahler v. United States Forest Service, 927 F. Supp. 1559, 1571-
72 (S.D. Ind. 1996) (same).
2. The Factual Argument
Plaintiffs next argue that the District Ranger arbitrarily
failed to consider evidence in the record demonstrating that the
construction and operation of the pipeline will have a
significant environmental impact on both the East Branch and the
surrounding environment.
- 16 - (a) The Pipeline's Impact on the East Branch
The new pipeline will enable Loon to withdraw more water
from the East Branch than it is able to withdraw using its
current system. Plaintiffs argue that the District Ranger was
arbitrary and capricious in concluding that the increased with
drawals would not have a significant impact on the river. Based
on my review of the Decision Memo and the administrative record,
I find that her conclusion is adeguately supported by the record
and, therefore, is not arbitrary or capricious.
Loon reguired a dredge and fill permit issued by the New
Hampshire Department of Environmental Services ("NHDES"), to
construct the pipeline's new intake galley and pumphouse.
Project File, at 317. As a condition of the permit's issuance,
the NHDES imposed a limit on Loon's ability to withdraw water
from the East Branch when the river's flow rate is egual to or
less than 62 cubic feet per second ("cfs"). Id. at 301, 326.
The permit also establishes a "step-down" approach to East Branch
withdrawals: 10 years after the date of the permit's issuance, or
at such a time as Loon constructs water storage ponds, the flow
limit below which Loon may not withdraw water from the East
Branch increases from 63 cfs to 85 cfs. Id. at 317. The NHDES
mandates that any changes in withdrawal pumping rates "must occur
in such a manner that flows in the river immediately downstream
of the withdrawal point do not vary more than 3.5 cfs per half
hour." Id. at 326, 327 n.l, 328 n.5. As long as Loon abides by
these restrictions, it may take as much water from the East
- 17 - Branch as the capacity of its new pipeline permits.
The flow restrictions limit Loon's access to water from the
East Branch regardless of whether Loon operates its current snow
making system or the new pipeline. The new pipeline, however,
gives Loon a greater capacity to withdraw water from the East
Branch during periods of permissible flow rate than Loon could
withdraw using its existing system. The crux of plaintiffs'
argument is that the District Ranger arbitrarily failed to
properly evaluate the effect that these increased withdrawals
could have on the river.
I reject plaintiffs' argument because the record contains
ample evidence to support the District Ranger's conclusion that
withdrawals at flow levels in excess of 62 cfs would not impact
the river. The 1992 FEIS for Loon's expansion plan described the
environmental effects of a variety of water withdrawal scenarios.
For example, the FEIS states that Loon could actually withdraw
from the East Branch at flows levels as low as 32 cfs prior to
undertaking any expansion. FEIS at 150. Indeed, the pre
expansion scenario provided for withdrawals at the lowest flow
level of all alternatives considered in the environmental review
of Loon's proposed expansion. ROD at 10; FEIS at 150. Never
theless, the Forest Service concluded that continued water
withdrawals from the East Branch at such a low flow level would
not have impacted downstream users of the river. FEIS at xii,
147, 153. Moreover, the FEIS concluded that even allowing for
withdrawals at the pre-expansion level of 32 cfs, water guality
- 18 - degradation would be "very unlikely and of a very small
magnitude." Id. at 150. Therefore, the District Ranger could
have reasonably concluded that the NHDES permit flow limits of 62
cfs in the short term and 85 cfs in the longer term "provide a
significant additional measure of security that impacts would not
occur." See id. at 156; Decision Memo, Responses at 11. Indeed,
the FEIS states that with a flow limitation of 85 cfs, "the
potential for impact to the stream ecosystem would be
eliminated." FEIS at 167.
I cannot conclude that the District Ranger was arbitrary and
capricious in relying on the extensive record establishing that
water withdrawals from East Branch at flow levels of greater than
62 cfs will not significantly effect the East Branch. Rather, I
find that the District Ranger's decision was perfectly consistent
with her NEPA-imposed duties.
(b) The Pipeline's Other Potential Impacts
Although the District Ranger undertook a detailed evaluation
of the pipeline's potential impact on the East Branch, she made
little effort to consider how the operation of the new pipeline
might effect other aspects of the environment. Such considera
tion was unnecessary, she concluded, because the pipeline was
intended to replace snow-making capacity that Loon lost as a
result of the May 5 Order. Plaintiffs challenge this conclusion
for two reasons. First, they contend that the District Ranger
was obligated to consider the pipeline's potential environmental
impact even if it merely replaced snow-making capacity that Loon
- 19 - lost as a result of the May 5 Order. Second, they challenge the
District Ranger's conclusion that the new pipeline merely
replaced lost snow-making capacity. I agree with the plaintiffs
on both counts.
The May 5 Order sets the current legal baseline for Loon's
snow-making operations.5 Although the order does not prohibit
Loon from engaging in any properly approved expansion of its
snow-making capacity, its legal effect in establishing the
baseline against which future expansion plans are to be measured
cannot be disregarded. The fundamental flaw in the District
Ranger's analysis is that she ignored this baseline in evaluating
whether the pipeline's additional snow-making capacity could have
a significant impact on the environment.
By all accounts, the new pipeline, intake gallery, and
pumphouse will enable Loon to make more snow than it could make
by operating its current facilities in accordance with the May 5
Order. The new pipeline is more than thirty percent wider than
Loon's existing pipeline (16 inches in diameter as opposed to 12
inches). That wider pipeline will be supplied with water by a
5 I issued the May 5 Order at the direction of the First Circuit Court of Appeals. See Dubois, 102 F.3d at 1294. The Forest Service submitted the order in draft form for my approval and the other parties -- Loon, Restore and Dubois -- all agreed to its terms. In issuing the order, I did not intend to limit Loon's ability to make snow provided that any new snow-making facilities were constructed in accordance with state and federal law. However, the May 5 Order does not authorize any new construction. Thus, to the extent that Loon proposes new construction that would otherwise reguire state and federal approvals, it cannot rely on the May 5 Order to avoid the need for such approvals.
- 20 - pump that has more than twice as much pumping capacity as Loon's
current pump. See Project File at 203 (5,000 gallons per minute
as opposed to 2,000 gallons per minute).
The District Ranger completely failed to consider the
potentially significant environmental impact that could result
from the new pipeline's increased snow-making capacity. The
record reveals that soil erosion is a constant concern at Loon
Mountain. FEIS at 134-35, 137. That the expansion FEIS devoted
significant space to discussing the possible effects that each
proposed snow-making scenario might have on the mountain's
surface -- including soil erosion, increased runoff, and the
possibility of increased soil flow into the East Branch --
illustrates that these considerations are important in assessing
the impact of any project that has the potential to increase
Loon's snow-making capacity. See FEIS, 133-138. Although the
District Ranger considered the impact that the construction of
the pipeline could have on soil erosion and recommended certain
measures to mitigate this potential impact. Decision Memo, at DM-
7, she did not consider the impact that an increased amount of
snow might have on the erosion problem.
The District Ranger also failed to consider other potential
effects such as increased crowds on the mountain and the host of
environmental concerns that skiers bring with them: more cars,
car exhaust, congestion, and parking problems. Again, the
expansion FEIS analyzed such potential effects of the various
proposed expansion alternatives in detail. FEIS at 193-213,
- 21 - 215-224; ROD at 13. It therefore stands to reason that before
declaring that there is no uncertainty as to the pipeline's
potential environmental impact, the District Ranger should at
least consider the potential effects of a decision by Loon to use
the full capacity of this proposed pipeline to increase its snow
making capacity. See FSH § 30.3, 30.5; 40 C.F.R. § 1508.4.
Even if it were appropriate to measure the potential
environmental impact of the new pipeline against an estimate of
Loon's past snow-making capacity rather than its current author
ized capacity, the District Ranger's decision would still be
arbitrary and capricious because it is based on an insupportable
conclusion as to Loon's past snow-making capacity. The District
Ranger states that prior to the May 5 Order, Loon had
unrestricted access to the top 15 feet of Loon Pond as well as
the ability to refill the Pond with water from the East Branch.
Id. In contrast, the May 5 Order limits Loon's use of Loon Pond
to four feet and prohibits Loon from discharging East Branch
water into the Pond. Id. at DM-5. The District Ranger states
that these restrictions deprive Loon of 93 million gallons of
water per year to which it was previously entitled. Id.
The record, however, shows conclusively that not only did
Loon never truly have access to the top fifteen feet of Loon
Pond, but also that Loon has never in practice used anywhere near
that amount of water. Rather, it appears that the notion that
Loon could withdraw the top 15 feet of water from Loon Pond and
refill the Pond arose only in a proposed alternative for expan
- 22 - sion. See FEIS at 144-45. Because the First Circuit's decision
nullified the expansion plan, that figure cannot possibly serve
as a basis for Loon's "current" level of operations. Moreover,
the record shows that the combined use of Loon Pond by both Loon
and the Town of Lincoln, which uses the Pond as a source of
drinking water, has amounted to only the top four to six feet of
Loon Pond in any given year. FEIS at 88. Indeed, in setting the
terms of the May 5 Order, all parties, including Loon and the
Forest Service, agreed that the four-foot draw-down figure
represented the depth to which both users have historically drawn
Loon Pond down in recent years. Transcript of April 11, 1997
hearing, 3-4, 73-81. Conseguently, to the extent that the
District Ranger relied upon the unsupportable conclusion that the
new pipeline will merely replace "lost" Loon Pond water, I find
her reasoning wholly inconsistent with the record and, therefore,
arbitrary and capricious.
In failing to consider the potential effects of increased
snow-making on the mountain, the District Ranger "entirely failed
to consider an important aspect of the problem" and, conse
guently, issued an uninformed decision. See Dubois, 102 F.3d at
1285 (guoting Motor Vehicle Mfrs. Ass'n v. State Farm Mut. Auto.
Ins. C o ., 463 U.S. 29, 43 (1983)). Having concluded that the
District Ranger's decision to categorically exclude the pipeline
project rather than prepare an EA or EIS was arbitrary and
capricious, I find, that Plaintiffs' succeed on the merits of
their claim that the District Ranger's decision to categorically
- 23 - exclude the pipeline violated NEPA.
C. Segmentation
NEPA requires that when an agency makes an initial
determination as to whether a proposed action may result in a
significant environmental impact, the agency cannot "segment" the
project from other related actions. Rather, the CEQ regulations
require Federal agencies to consider "[w]hether the action is
cumulatively significant impacts." 40 C.F.R. § 1508.27(b) (5).
Further, the regulations provide that "significance cannot be
avoided by terming an action temporary or breaking it down into
small component parts." 40 C.F.R. § 1508.27 (b) (7) .6 Relying on
6 The CEQ regulations also require that separate but related actions should be considered in the same EIS if they qualify as "connected actions," "cumulative actions," or "similar actions." 40 C.F.R. § 1508.25. However, this section of the regulations describes a process referred to as "scoping" that comes into play only after the agency has determined that the proposed action will be considered in an EIS. See 40 C.F.R. § 1502.4. ("Agencies shall make sure that the proposal which is the subiect of an TEISI is properly defined" by considering the factors set forth in § 1508.25)(emphasis added). Although the FSH requires the Forest Service to engage in scoping on all projects, not only those warranting an EIS, the FSH also grants the respective agency official significant leeway in conducting that scoping. In this regard, the FSH provides that "[b]ecause the nature and complexity of a proposed action determines the scope and intensity of the required analysis, no single technique is required or prescribed. Except where required by statute or regulations, the responsible official may adjust or combine the various stages in the process outlined" in the FSH. FSH § 11, 57 Fed. Reg. at 43194. A reasonable interpretation of this language is that the responsible official may decline to apply the specifics of the FSH's scoping provisions so long as she complies with the CEQ regulations. Therefore, because the CEQ regulations require the Forest Service to apply § 1508.25 only when a project will be subject to an EIS, the District Ranger did not abuse her discretion in not considering its provisions here, where she has determined that the project has independent utility and that it - 24 - these regulations, plaintiffs challenge as arbitrary the District
Ranger's conclusion that the pipeline could be considered
separately from Loon's expansion plan because the pipeline has
independent utility whether or not the larger expansion plan is
eventually approved.7
As noted above, a reviewing court customarily defers to an
agency's reasonable interpretation of a statute or regulation
that it administers. See Lvnq v. Pavne, 476 U.S. at 939; Gioioso
& Sons, 115 F.3d at 107-08 (citing Chevron, 467 U.S. at 843-44 &
n.ll). Therefore, I must defer to the Forest Service's inter
pretation of the CEQ regulation "so long as the interpretation
meshes sensibly with the regulation's language and purpose." See
does not warrant an EIS.
7 Plaintiffs also contend that the District Ranger failed to consider the impact of the pipeline in conjunction with two other structures built concurrently with the pipeline. Loon has constructed a water intake gallery and a new pumphouse on the bank of the East Branch that will supply the new pipeline with water. Decision Memo at DM-2. Contrary to Plaintiffs' contention, however, the District Ranger did consider the impact of the pipeline when used in conjunction with these two structures. Because these two structures were built on private land, their construction fell outside of the Forest Service's regulatory jurisdiction. Id. No less than eight separate federal and state agencies were involved in evaluating and/or permitting the intake gallery and pumphouse. Id. The District Ranger reviewed more than 400 pages of reports, evaluations, correspondence, and permits compiled by these various agencies. See Project File at 271-689. She evaluated this data with reference to the use of these structures in conjunction with the proposed pipeline and concluded that "these activities will not individually or cumulatively have a significant effect on the guality of the human environment." Decision Memo at DM-2. After carefully reviewing the pertinent portion of the administrative record dealing with the effects of these activities, I find that there is a sufficient basis in the administrative record to support her conclusion.
- 25 - Gioioso & Sons, 115 F.3d at 107; Methow Valiev Citizens Council,
490 U.S. at 359 (Forest Service's interpretation of own
regulations is controlling unless "plainly erroneous or
inconsistent with the regulation").
I cannot conclude that the Forest Service's interpretation
is "plainly erroneous or inconsistent with the regulation."
See Methow Valiev Citizens Council, 490 U.S. at 359. Rather,
reference to a project's independent utility "meshes sensibly,"
see Gioioso & Sons, 115 F.3d at 107, with the notion of
determining whether the project is "related to other actions with
individually insignificant but cumulatively significant impacts."
40 C.F.R. § 1508.27(b)(7) (emphasis added). Moreover, at least
one Circuit Court of Appeals has agreed with the Forest Service's
interpretation. See Airport Neighbors Alliance, 90 F.3d at 430.
The Tenth Circuit has repeatedly articulated the test for whether
a particular action is related to other actions with cumulatively
significant impacts as whether the actions were "so
interdependent that it would be unwise or irrational to complete
one without the others." Id., (guoting Park County Resource
Council, Inc. v. United States Dep't of Aqric., 817 F.2d 609, 623
(10th Cir. 1987), overruled on other grounds by Village of Los
Ranchos De Albuguergue v. Marsh, 956 F.2d 970, 973 (10th Cir.),
cert. denied 506 U.S. 817 (19 92)); see also Communities, Inc. v.
Busev, 956 F.2d 619, 627 (6th Cir.), cert, denied, 506 U.S. 953
(1992); Save Barton Creek Ass'n v. Fed. Highway Admin., 950 F.2d
1129, 1139 (5th Cir.), cert, denied, 505 U.S. 1220 (1992); Webb
- 26 - v. Gorsuch, 699 F.2d 157, 161 (4th Cir. 1983) (same).
The District Ranger's segmentation analysis is also
consistent with the underlying purpose of the regulation which is
to ensure that parties are not able to circumvent the NEPA
process by breaking down a larger project that has a significant
impact into a series of smaller projects that individually lack
significant impacts. See 40 C.F.R. § 1508.27(b)(7); Save Barton
Creek Ass'n , 950 F.3d at 1139. There is no danger here that the
pipeline project will escape NEPA review. As I have already
explained, the District Ranger will have to reconsider her
conclusion that the pipeline is eligible for categorical
exclusion. Moreover, the larger project. Loon's expansion plan,
will also be subject to the full NEPA review process. In the
larger project's EIS, the Forest Service will have to consider
any improvements, such as this pipeline, that Loon has made after
initially proposing expansion. Conseguently, neither the
pipeline project nor Loon's larger expansion plan will escape
NEPA review as a result of the District Ranger's finding that the
pipeline project has an independent utility and therefore may
proceed independently of Loon's larger expansion.8
8 In Kleppe v. Sierra Club, the Supreme Court stated that it was not necessary that an agency "complete a comprehensive impact statement on all proposed actions before approving any of the projects." 427 U.S. 390, 414 n.26 (1976). Rather, an agency could approve one pending project and then "take into consideration the environmental effects of the existing project when preparing the comprehensive statement on the cumulative impact of the remaining proposals." Id., quoted in Coalition on Sensible Transp., Inc. v. Dole, 826 F.2d 60, 71 (D.C. Cir. 1987). To hold otherwise would have the impractical result of barring any party that has submitted a comprehensive plan for agency - 27 - In summary, the District Ranger plausibly construed the
CEQ's segmentation regulation to permit a proposed action to be
considered separately from other proposed actions if it has
independent utility. Further, the record amply supports her
conclusion that the pipeline proposal had such independent
utility. Accordingly, she did not act arbitrarily in concluding
that the pipeline proposal need not be considered in the same EIS
in which other aspects of Loon's expansion plan will be
considered.
III. CONCLUSION
For the reasons stated above, the Forest Service erred in
determining that the pipeline project was eligible for exclusion
without first considering whether the increase in snow-making
capacity that would result from the construction and operation of
the new pipeline could have a significant impact on the
environment. Whether this error warrants injunctive relief,
however, is not something that I can determine on the present
record. Rather, I must first balance the parties' competing
claims of injury and "must consider the effect on each party of
the granting or withholding" of such relief. See Amoco Prod. Co.
v. Village of Gambell, 480 U.S. 531, 542 (1987); Weinberger v.
approval from making any independently justifiable improvements until the agency approves the larger comprehensive project. Such a holding might actually encourage parties to surreptitiously segment their larger projects into smaller ones and discourage them from being forthright and notifying the respective agency of their larger plans.
- 28 - Romero-Barcelo, 456 U.S. 309, 313 (1982); Conservation Law Found,
Inc. v. Busev, 79 F.3d 1250, 1272 (1st Cir. 1996). Accordingly,
I will hold a further hearing on February 26, 1998 at 10:00 a.m.
to address this issue. At this hearing, the parties will have
the opportunity to present evidence relevant to the harms they
would suffer upon the granting or withholding of injunctive
relief.
SO ORDERED.
Paul Barbadoro Chief Judge January 20, 1998
cc: Grant T. Kidd, Esg. Cindy E. Hill, Esg. T. David Plourde, Esg. Alexander Kalinski, Esg. Evan Slavitt, Esg. Garry R. Lane, Esg. Jed Z. Callen, Esg.
- 29 -