Ninth Circuit upholds critical habitat analysis, both on meaning of "occupied" habitat and on economic baseline analysis
Arizona Cattle Growers Ass’n v. Salazar, No. 08-15810, 606 F.3d 1160, 2010 WL 2220036 (9th Cir., June 4, 2010)(Fletcher, Canby and Graber, Circuit Judges).
SUMMARY: Arizona Cattle Growers' Association (“Arizona Cattle”) appeals from the district court's grant of summary judgment rejecting its challenge to the United States Fish and Wildlife Service's (“FWS”) designation of critical habitat for the Mexican Spotted Owl. Arizona Cattle argues that the FWS unlawfully designated areas containing no owls as “occupied” habitat and that the FWS calculated the economic impacts of the designation by applying an impermissible “baseline” approach. We find no fault with the FWS's designation of habitat for the Mexican Spotted Owl. The FWS did not impermissibly treat unoccupied areas as “occupied,” and we hold that it permissibly applied the baseline approach in analyzing the economic impact of the critical habitat designation.
KEITHINKING: The case contains a greatest hits collection of citations to Ninth Circuit ESA case law, and ultimately, creates a clear conflict between the 9th and 10th Circuits. The strong potential exists for a Petition for Writ of Certiorari to the U.S. Supreme Court...
BACKGROUND: In 1993 the Mexican Spotted Owl (photo above from Zion National Park) was listed as a threatened species under the Endangered Species Act (“ESA”). The listing decision prompted a series of lawsuits alternately seeking to compel the FWS to designate critical habitat for the owl and, following the FWS's designation of habitat, attacking that designation… In 2004 the FWS designated approximately 8.6 million acres of critical habitat. It is this designation, the 2004 Final Rule, that Arizona Cattle challenges in the current action… The 2004 Final Rule concluded that all of the designated habitat was occupied by the owl.
ESA DEFINITION OF OCCUPIED. The ESA defines a species' critical habitat as (i) the specific areas within the geographical area occupied by the species, at the time it is listed ..., on which are found those physical or biological features (I) essential to the conservation of the species and (II) which may require special management considerations or protection; and (ii) specific areas outside the geographical area occupied by the species at the time it is listed ..., upon a determination by the Secretary that such areas are essential for the conservation of the species. 16 U.S.C. § 1532(5)(A). The statute thus differentiates between “occupied” and “unoccupied” areas.
EXCERPT RE: MEANING OF OCCUPIED. We first consider whether the owl “occupied” the designated areas, as defined by the ESA. We conclude that the FWS permissibly interpreted the word “occupied” in the ESA to include areas where the owl was likely to be present and that, applying this definition, the FWS designated only “occupied” areas… It is useful to unpack this inquiry into two components: uncertainty and frequency. Uncertainty is a factor when the FWS has reason to believe that owls are present in a given area, but lacks conclusive proof of their presence. Frequency is a factor when owls are shown to have only an intermittent presence in a given area … We have ample guidance on the “uncertainty” issue. The ESA provides that the agency must determine critical habitat using the “best scientific data available.” 16 U.S.C. § 1533(b)(2); see also id. § 1533(b)(6)(C)(ii). This standard does not require that the FWS act only when it can justify its decision with absolute confidence. See, e.g., Pub. Citizen Health Research Group v. U.S. DOL, 557 F.3d 165, 176 (3d Cir.2009); Greenpeace Action v. Franklin, 982 F.2d 1342, 1354-55 (9th Cir.1992). Although the FWS cannot act on pure speculation or contrary to the evidence, the ESA accepts agency decisions in the face of uncertainty. Compare Ariz. Cattle Growers' Ass'n v. U.S. Fish & Wildlife, 273 F.3d 1229, 1244 (9th Cir.2001), with Sw. Ctr. for Biological Diversity v. Babbitt, 215 F.3d 58, 60-61 (D.C.Cir.2000). Turning to the “frequency” component, Arizona Cattle asserts that the word “occupied” is unambiguous and must be interpreted narrowly to mean areas that the species “resides in.” … We cannot agree that “occupied” has an unambiguous, plain meaning as Arizona Cattle suggests. The word “occupied,” standing alone, does not provide a clear standard for how frequently a species must use an area before the agency can designate it as critical habitat. Cf. Amoco Prod. Co. v. Vill. of Gambell, 480 U.S. 531, 548 n. 14 (1987) (explaining that there is “clearly” no plain meaning to the phrase “public lands which are actually occupied”).
EXCERPT RE: APPLICATION OF OCCUPIED. After a thorough review of the record we find that the FWS did not arbitrarily and capriciously treat unoccupied areas as occupied. We reiterate that when an agency is acting within its expertise to make a scientific determination “a reviewing court must generally be at its most deferential.” Balt. Gas & Elec. Co. v. NRDC, 462 U.S. 87, 103 (1983); Lands Council v. McNair, 537 F.3d 981, 993 (9th Cir.2008) (en banc), abrogated in part on other grounds by Winter v. NRDC, 129 S.Ct. 365 (2008). The FWS took, as a starting point for its 2004 designation, the three types of habitat management areas that it developed in the 1995 Recovery Plan. Simply by virtue of the definitions of these habitat management types, there is a direct link between the designated territory and owl occupancy… we note significant record support for owl occupancy of these areas in the form of studies correlating the habitat characteristics of protected and restricted areas with owl presence. Cf. Gifford Pinchot, 378 F.3d at 1066; cf also Envtl. Prot. Info. Ctr. v. U.S. Forest Serv., 451 F.3d 1005, 1017 (9th Cir.2006) (rather than counting individual animals, an agency may in appropriate cases use habitat as a proxy). Even more significant is the fact that the FWS excluded areas with evidence of few or no owls. The 2004 Final Rule explains that the FWS “did not designate some areas that are known to have widely scattered owl sites, low owl population densities, and/or marginal habitat quality.” We find this statement supported by record evidence explaining the FWS's decision to exclude several areas due to an absence of owls… The FWS was not attempting to designate areas devoid of owls as “occupied” in the 2004 Final Rule. Although seeming inconsistencies between the FWS's decisions may shed light on the agency's process, and changes from past positions that are unsupported by evidence are unlawful, ultimately it is the 2004 Final Rule that is before the court and our inquiry is whether the FWS exceeded its authority or deviated from the evidence. See Nat'l Ass'n of Home Builders, 551 U.S. at 658-59; Wetlands Action, 222 F.3d at 1122 n. 8. The FWS's analysis solidly demonstrates the connection between the designated areas and owl occupancy, notwithstanding that the agency previously adopted an unnecessarily restrictive view of the areas the owl occupied as limited to known nesting sites. The agency's approach in the 2004 Final Rule was supported by the evidence and within permissible bounds.
EXCERPT RE: ECONOMIC ANALYSIS. Arizona Cattle challenges the FWS's analysis of the economic impacts of the critical habitat designation. In contrast to the listing decision, under the ESA the agency may designate critical habitat only after considering the economic impact of the designation on any particular area. Id. § 1533(b)(2)… For the reasons expressed below, we find no fault with the agency's economic analysis. The parties agree that the FWS applied the “baseline” approach to the economic analysis. Under this approach, any economic impacts of protecting the owl that will occur regardless of the critical habitat designation-in particular, the burdens imposed by listing the owl-are treated as part of the regulatory “baseline” and are not factored into the economic analysis of the effects of the critical habitat designation. Arizona Cattle, relying on the Tenth Circuit's decision in New Mexico Cattle Growers Association, argues that this was error and that the FWS was required to apply a “co-extensive” approach to the economic analysis. Under the co-extensive approach, the agency must ignore the protection of a species that results from the listing decision in considering whether to designate an area as critical habitat. Any economic burden that designating an area would cause must be counted in the economic analysis, even if the same burden is already imposed by listing the species and, therefore, would exist even if the area were not designated… We therefore reject the Tenth Circuit's approach in New Mexico Cattle Growers Association as relying on a faulty premise and hold that the FWS may employ the baseline approach in analyzing the critical habitat designation. The baseline approach is, if anything, more logical than the co-extensive approach. The very notion of conducting a cost/benefit analysis is undercut by incorporating in that analysis costs that will exist regardless of the decision made… Congress has directed the FWS to list species, and thus impose a regulatory burden, without consideration of the costs of doing so. See 16 U.S.C. § 1533(a); N.M. Cattle Growers, 248 F.3d at 1282. It would be strange to conclude that Congress intended the FWS to consider costs at the critical habitat phase that the agency was barred from considering at the listing phase where, as a result, the analysis would bear little relationship to reality.