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February 27, 2015 Articles

What Energy Lawyers Need to Know about the Endangered Species Act

The ESA is a potent tool for environmentalists seeking to derail energy projects.

By Michael A. Oropallo – February 27, 2015

The Endangered Species Act (ESA), signed into law in 1973 by President Nixon, was the culmination of a series of efforts to stave off the extinction of such high-profile species as the passenger pigeon, which became extinct 100 years ago. Congress, sportsmen, and the general public recognized the need to protect and preserve populations of species that were in peril. Though measures such as hunting seasons and bag limits were thought to be the only focus of protecting such species, in reality, more species have become extinct due to loss of habitat than any other cause. Even the passenger pigeon succumbed to extinction because of deforestation and loss of habitat that was paramount to its very existence. Thus, though the target species gets the attention of the general public as the primary focus of these wildlife laws, its habitat is often more crucial.

Today, the ESA is frequently used by environmentalists to oppose energy projects. In this article, I provide a brief summary of the ESA and how it can apply to projects that require federal funding, authorization, or action.

Listing of a Species
The heart of the ESA is the listing of candidate species as “endangered” or “threatened.” The act defines “endangered” as “any species which is in danger of extinction throughout all or a significant portion of its range other than a species of the Class Insecta determined by the Secretary to constitute a pest whose protection under the provisions of this chapter would present an overwhelming and overriding risk to man.” ESA § 1532(6). A “threatened” species is defined as “any species which is likely to become an endangered species within the foreseeable future throughout all or a significant portion of its range.” Id. § 1532(20).

Detailed aspects of the actual species-listing process is beyond the scope of this article, but a brief overview is in order. The secretary of the interior is required to publish and maintain a list of all species that have been designated as threatened or endangered. ESA § 1533(c). Species can be added to or removed from the list through a process requiring public notice (in the Federal Register) and comment, and can be initiated by the secretary or any “interested person” by way of a petition to the Fish and Wildlife Service. Id. §§ 1533(b)(1) et seq. The listing is made on the basis of five statutory factors:

1. The present or threatened destruction, modification, or curtailment of the species’ habitat or range;
2. Overutilization for commercial, recreational, scientific, or educational purposes; 
3. Disease or predation;
4. The inadequacy of existing regulatory mechanisms; or
5. Other natural or manmade factors affecting a species’ continued existence.

Id. § 1533(a)(1)(A)–(E). See also 50 C.F.R. § 424.11(c).

The final decision to list a species is made by the secretary but must be made “solely on the basis of the best scientific and commercial data available . . . after conducting a review of the status of the species and after taking into account those efforts, if any, being made by any State or foreign nation . . . to protect the species. . . .” ESA § 1533(b)(1)(A).

There are a number of administrative, procedural, and legal mechanisms available to challenge a listing. But keep in mind that courts will give deference to an agency’s interpretation of the statutory framework and associated ambiguities. See Chevron, U.S.A., Inc. v. Natural Res. Def. Council, Inc., 467 U.S. 837, 843–44 (1984) (where the court reviews an agency’s interpretation of a statute it’s charged with administering, the court will defer to any reasonable interpretation of ambiguous statutory language). And the listing determination will only be overturned if it was arbitrary and capricious. See 5 U.S.C. § 706(2)(A). See also Babbitt v. Sweet Home, 515 U.S. 687, 708 (1995)(“The task of defining and listing endangered and threatened species requires an expertise and attention to detail that exceeds the normal province of [the courts].”). Courts are thus not empowered to substitute their own judgment for that of any agency and are only permitted to hold the agency to “minimal standards of rationality.” Thus, a challenge to the listing may be too late in the process to be effective in avoiding the consequences of a listing.

Protection of Listed Species
Once a species is listed, protections are broad and varied, and can carry with them severe penalties. Foremost among those protections is the prohibition against “take” of the species. ESA § 1538(a)(1). “Take” is defined as “to harass, harm, pursue, hunt, shoot, kill, trap, capture, or collect, or to attempt to engage in any such conduct.” Id. § 1532(19). A take can also occur as a result of indirect or unintended actions. See Babbitt, 515 U.S. at 704.

Protection of Habitat
The prohibition on “take” applies not only to the listed species but also to habitat destruction or modification. See The Aransas Project v. Shaw, 756 F. 3d 801 (5th Cir. 2014) (infusing the concept of “proximate cause” to reject “remote” causes of “take” of endangered whooping crane). For example, “harm” includes “significant habitat modification or degradation where it actually kills or injures wildlife by significantly impairing essential behavioral patterns, including breeding, feeding or sheltering.” 50 C.F.R. § 17.3. Similarly, “harass” means “an intentional or negligent act or omission which creates the likelihood of injury to wildlife by annoying it to such extent as to significantly disrupt normal behavioral patterns . . .” Id.

Once a species is listed, the secretary must designate any critical habitat of the species. ESA § 1533(a)(3)(A). The Fish and Wildlife Service determines whether certain areas are critical for the ongoing survival of the species. See 50 C.F.R. § 402.02  (“a direct or indirect alteration that appreciably diminishes the value of critical habitat for both the survival and recovery if a listed species”). Unlike a species listing, the designation of critical habitat requires consideration of economic impacts. ESA § 1533(b)(2).

Section 7 Consultation
The impact of a species listing is most often felt when there is some federal requirement or approval necessary for a project or development. Section 7 of the ESA is triggered if there is a “federal nexus,” that is, a federal agency that can authorize, fund, or carry out an action. Section 7 requires all federal agencies to consult with the Fish and Wildlife Service to ensure that their actions do not jeopardize the continued existence of a listed species or adversely modify critical habitatSee 50 C.F.R. pt. 402.

Section 7 consultation can be either formal or informal. There are no real rules or deadlines when it comes to informal consultation, other than providing the service with a description of the action in enough detail to ascertain and identify any affected listed species and/or critical habitat, and to determine whether there are any potential direct or indirect effects of the action on the species/critical habitat. Consultation may even be concluded informally if there is an agreement (in writing) by the service that the action will have “no effect” on, or is “likely to adversely affect,” the species/habitat. A corollary to an informal consultation is the use of the service’s online tools, such as the service’s IpaC (Information, Planning, and Conservation System), which allows a user to plug in the coordinates of a proposed project and obtain a list of listed species in that vicinity. Some location-specific Fish and Wildlife Service websites can even provide a “no effects” concurrence just by searching the project’s location.

Whether or not an informal or formal consultation is commenced for a federal action, there are three potential outcomes: (1) no effect; (2) may affect, but not likely to affect; or (3) likely to adversely affect. Federal agencies must ensure their actions are not likely to jeopardizethe continued existence of any endangered or threatened species or cause the destruction or adverse modification of critical habitat.ESA § 7(a)(2). If the action is likely to affect a listed species or its critical habitat, formal consultation becomes necessary. Either way, if there are listed species or critical habitat present in the action area, some sort of biological assessment or biological evaluation is necessary to allow the service to evaluate the potential effects.

The submission of a biologic assessment or biological evaluation shall include:

(1) A description of the action to be considered; 
(2) A description of the specific area that may be affected by the action; 
(3) A description of any listed species or critical habitat that may be affected by the action; 
(4) A description of the manner in which the action may affect any listed species or critical habitat and an analysis of any cumulative effects; 
(5) Relevant reports, including any environmental impact statement, environmental assessment, or biological assessment prepared; and 
(6) Any other relevant available information on the action, the affected listed species, or critical habitat.

50 C.F.R. § 402.14(c).

The consultation begins upon receipt of complete information, and is concluded 90 days after its initiation (but may be extended). The service issues a biological opinion within 45 days after ending formal consultation, and identifies whether the action is likely to jeopardize the continued existence of a listed species or adversely modify critical habitat.

If the biological opinion makes a finding of “no jeopardy” or “no adverse modification,” the action can proceed. In such cases, the service can provide exemption from incidental take, and recommend discretionary conservation measures. However, if there is a “jeopardy” or “adverse modification” finding, then the service must provide “reasonable and prudent alternatives” to the referring agency, and the alternatives must be consistent with the project’s design, scope, location, duration, and timing.

The ESA is a potent tool for environmentalists seeking to derail energy projects. Energy companies with projects that could be affected by the ESA should be proactive to ensure that the statute is not used to block the project. The following are some practical steps:

  • Consider funding and/or participating in studies.
  • Assess pre-listing conservation measures to avoid listing.
  • Know the listed species in the project areas.
  • Know the people at U.S. Fish and Wildlife in the project area.

If companies are prepared to address ESA issues early in the process and engage with the relevant agencies, they are more likely to obtain a favorable outcome, potentially minimize costs, and ensure a good foundation for any subsequent administrative action or litigation.

Keywords: energy litigation, Endangered Species Act, ESA, Fish and Wildlife Service, section 7, environmental litigation

Michael Oropallo is a partner at Hiscock & Barclay in Syracuse, New York.

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