Ninth Circuit Expands "Agency Action" for Endangered Species Act Consultation

On June 1, 2012, the Ninth Circuit issued a decision holding that an agency’s decision not to act constituted “agency action” for purposes of consultation under the Endangered Species Act (“ESA”).  In Karuk Tribe of California v. U.S. Forest Service, 681 F.3d 1006 (9th Cir. 2012), an en banc panel considered the question of whether the U.S. Forest Service (“USFS”) was required to engage in formal Section 7 consultation with the U.S. Fish and Wildlife Service (“USFWS”) or the National Marine Fisheries Service (“NMFS”) (collectively, the “Services”) prior to determining that small-scale recreational mining activities that “may affect” threatened Klamath River coho salmon did not require a full evaluation of impacts.  The en banc panel, overturning prior decisions in the case, held that USFS is required to consult with the Services prior to deciding whether to require a plan of operations.

This decision is largely viewed as an expansion of agency activities subject to ESA Section 7 consultation.  While only directly applicable in the Ninth Circuit, the decision has several potential significant implications:

• Thousands of agency decisions not previously considered to be “agency action” for purposes of Section 7 consultation must now be considered “agency action,” and thus subject to formal Section 7 ESA consultation.  Formal consultation is a time-intensive process involving agency review and preparation of a biological opinion, a process that takes, at a minimum, 135 days.  These decisions largely fall into areas involving mining, water rights and forestry, and will likely significantly delay agency decision-making.
  
  
• This delay will be compounded in light of the Services’ ongoing budgetary restrictions and administrative burden imposed by the fall 2011 settlement between USFWS and environmental organizations that requires USFWS to make listing decisions for hundreds of species on a court-imposed timeline.
  
  
• Due to the potential for significant impacts within and beyond the Ninth Circuit, and apparent conflict with established precedent in the Ninth and other circuits, this case is a prime candidate for U.S. Supreme Court review.

Background

Several small-scale recreational miners who pan for gold by hand, using motorized sluicing or mechanical suction dredging, submitted notices of intent (“NOIs”) to the USFS to exercise their existing mining rights in portions of the Klamath River.  Under the General Mining Law of 1872 and its 1974 implementing regulations, mining activities are broken into three categories:  (1) those that “will not cause” significant disturbances of surface resources, including fisheries and wildlife habitat; (2) those that “might cause” such disturbances; and (3) those that “will likely cause” such disturbances.  The activities at issue here apparently fell into the second category. 

Under the USFS regulations, anyone proposing such activities must submit an NOI to operate that contains information “sufficient to identify the area involved, the nature of the proposed operations, the route of access to the area of operations and the method of transport.”  The USFS district ranger must evaluate the NOI and, within 15 days of receipt, inform the miner whether impacts rise to the level of significance requiring a more detailed plan of operations.  Prior to this case, the USFS had consistently treated review of NOIs as “no action,” given the low potential for impact and the USFS’s limited ability under the mining law to impose restrictions on mining activities.USFS approved each of the four submitted NOIs, indicating that a more detailed evaluation of the mining operations’ impacts were not necessary. 

“Agency Action”

The Ninth Circuit agreed with the Tribe, finding that the USFS “approval” of the NOIs was indeed “agency action” within the meaning of Section 7, and that allowing mining activities that “might cause” disturbance of surface resources was sufficient to meet the ESA standard requiring consultation.  The court found that “there is ‘agency action’ whenever an agency makes an affirmative, discretionary decision about whether, or under what conditions, to allow private activity to proceed” and that here, USFS “made affirmative, discretionary decisions about whether, and under what conditions, to allow mining to proceed under the NOIs.”  Karuk Tribe, 681 F.3d at 1011.

The panel’s dissenting opinion strongly disagreed, noting that the majority’s opinion conflicts with precedent set by the court’s 2006 decision in Western Watersheds Project v. Matejko, 468 F.3d 1099 (9th Cir. 2006).  At issue in Matejko was whether the agency had a duty to consult when it exercised its discretion under water rights authorities not to regulate diversions of water by parties holding vested rights of way.  The court held that the NOI process does not constitute an ESA “agency action” and that “inaction” is not “action” by means of an NOI likely to require ESA consultation under this decision.  Other affirmative, discretionary decisions that take the form of “no further action needed because no impact” are likely to fall under the principle in this case.  The dissent expressed concern about the practical impacts of requiring the significantly higher number of consultations that will result from the majority’s opinion and disagreed with the majority’s interpretation of what should constitute “agency action,” finding that the majority had overreached.

Conclusion

The Ninth Circuit’s opinion increases the types of federal agency decisions that will be considered “agency actions” for purposes of determining whether ESA Section 7 consultation is required.  Decisions previously considered “inaction” may now require formal consultation.  This increased level of regulation will likely result in initial confusion as the courts and agencies determine how to proceed. Increased delays in project start-up times and increased litigation can also be expected.

© 2012 Perkins Coie LLP