Home Builders & EPA Prevail In Supreme Ct. CWA/ESA Ruling

Jun 25: The U.S. Supreme Court, in a split 5-4 decision, has decided two consolidated cases -- National Association of Home Builders v. Defenders of Wildlife (No. 06-340) and Environmental Protection Agency v. Defenders of Wildlife et al. (No. 06–549). The majority decision is in favor of the arguments of U.S. EPA and the National Association of Home Builders (NAHB). The cases were on appeal from the U.S. Court of Appeals, Ninth Circuit and involve competing provisions of the Clean Water Act (CWA) and the Endangered Species Act (ESA). Judge Alito delivered the opinion of the Court, in which Roberts, Scalia, Kennedy, and Thomas, joined. Justice Stevens, filed a dissenting opinion, in which Souter, Ginsburg, and Breyer joined. Justice Breyer filed a separate dissenting opinion.

As explained by the majority, these cases concern the interplay between two Federal environmental statutes. Section 402(b) of the CWA requires that U.S. EPA transfer certain permitting powers to state authorities upon an application and a showing that nine specified criteria have been met. Section 7(a)(2) of the ESA of 1973 provides that a Federal agency must consult with agencies designated by the Secretaries of Commerce and the Interior in order to "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." The question presented is whether §7(a)(2) effectively operates as a tenth criterion on which the transfer of permitting power under the first statute must be conditioned. The majority opinion said, "We conclude that it does not. The transfer of permitting authority to state authorities -- who will exercise that authority under continuing federal oversight to ensure compliance with relevant mandates of the Endangered Species Act and other federal environmental protection statutes -- was proper. We therefore reverse the judgment of the United States Court of Appeals for the Ninth Circuit."

Under Federal law, a state may take over the CWA pollution permitting program in its state from the Federal EPA) if it applies to do so and meets the applicable standards. The case concerned Arizona’s application to run the CWA program in Arizona. In its August 22, 2005, 2-1 split opinion [See WIMS 8/29/05] the Ninth Circuit had said the case, "...largely boils down to consideration of one fundamental issue: Does the Endangered Species Act authorize -- indeed, require -- the EPA to consider the impact on endangered and threatened species and their habitat when it decides whether to transfer water pollution permitting authority to state governments?" The Ninth Circuit ruled that, EPA did have the authority to consider jeopardy to listed species in making the transfer decision, and erred in determining otherwise," and said EPA’s decision was "arbitrary and capricious."

In his dissenting opinion, Justice Stevens indicates, "These cases present a problem of conflicting 'shalls...' When faced with competing statutory mandates, it is our duty to give full effect to both if at all possible... The Court [majority opinion] fails at this task. Its opinion unsuccessfully tries to reconcile the CWA and ESA by relying on a federal regulation... which it reads as limiting the reach of §7(a)(2) to only discretionary federal actions... Not only is this reading inconsistent with the text and history of §402.03, but it is fundamentally inconsistent with the ESA itself."

In a release, NAHB President Brian Catalde said, “This decision recognizes that we must always maintain a balance when we look at environmental regulations. We can’t say that the Endangered Species Act is an ‘uber-statute’ that should slow down regulatory decisions under the Clean Water Act even as we recognize that both laws concern issues that are vital to preserving this earth for the next generation. This decision also tells us that the U.S. Supreme Court is helping to preserve housing affordability by striking down efforts at unnecessary, duplicative regulation. Congress created the Clean Water Act to prevent, reduce and eliminate pollution. But it’s the Clean Water Act, not the Arid Desert Act. There is no logic to twisting a program designed to protect the waters of the United States to give special considerations to species that have no relation to that water.”

In a statement from Rodger Schlickeisen, President of Defenders of Wildlife he said the decision limits, "...the obligation of federal agencies under the Endangered Species Act to ensure that their actions do not jeopardize imperiled species. The majority held that the Endangered Species Act’s duty to consult applies only to discretionary actions. Today’s decision, while unfortunate, should apply only to a very narrow category of actions by federal agencies -- actions compelled by the terms of another federal law -- and should not be read as a broad abrogation of the authority of the Endangered Species Act. We are very disappointed with the majority’s interpretation of the Endangered Species Act, which we think ignores the clear intention of Congress when they enacted the Endangered Species Act. The Act was intended by Congress as a clear, independent mandate for all federal agencies to ensure that their actions do not jeopardize endangered species or destroy their critical habitat."

Access the Supreme Court decision, the Syllabus and the dissenting opinions (click here). Access the Supreme Court Docket for the case (click here). Access the complete Ninth Circuit opinion (click here). Access a release from NAHB (click here). Access a release from Defenders (click here). [*Water, *Wildlife]