White House Chief of Staff Orders Freezing of Pending Regulations

On January 20, 2017, Reince Priebus, the White House Chief of Staff and Assistant to the President, issued a memorandum to the heads of all executive departments and agencies ordering them to freeze the processing of all regulations.  The stated intent of this action is to ensure that “the President’s appointees or designees have the opportunity to review any new or pending regulations.”  At the outset, the memo states that, with the exception of regulations addressing any “emergency situations” or “urgent circumstances relating to health, safety, financial, or national security matters” and those subject to statutory or judicial deadlines, no regulations are to be sent to the Office of the Federal Register (“OFR”) until they have been reviewed and approved by an agency or department head appointed by President Trump and vetted with the Office of Management and Budget Director. In addition, new or pending regulations that have been already been sent to the OFR, but not yet published, should be withdrawn (consistent with OFR procedures).

While on its face, this memo appears to only affect those regulations that are currently under review and have not yet been published as final in the Federal Register, it is clear that the intention is to allow the new administration to re-evaluate final rules that have not yet taken effect and possibly even those that have.   For those regulations that have been published in the Federal Register, but have not yet taken effect, the memo orders the agencies to temporarily postpone their effective date for 60 days from January 20th (not from the published effective date), for the stated purpose of “reviewing questions of fact, law, and policy.”  Further, the memo states that in instances where it is permissible, the agencies should consider proposing a notice-and-comment period that extends beyond the 60-day moratorium.

Relying on the Regulatory Planning and Review Executive Order (“E.O.”) 12866 issued in 1993 by President Clinton, as well as E.O. 13422 (which amended E.O. 12866 to include, among other things, the definition of agency “guidance”) issued by President Bush in 2007, the memo employs a broad definition of the term “regulation.”  In other words, the memo purports to require the review and consideration of any instrument, including guidance documents, memoranda and opinions that have a “binding” regulatory effect or would otherwise influence the interpretation of law by an agency.

While not plainly stated in the memo, the regulatory freeze may allow the incoming administration to identify already finalized regulations and potentially refer those to Congress for disapproval utilizing the Congressional Review Act (“CRA”) of 1996.  Under the CRA, Congress can “disapprove” a regulation issued as a final rule by a federal agency by issuing a joint “disapproval resolution” within 60 legislative days of the regulation being referred to Congress.  While the CRA has been rarely utilized, most notably due to the level of effort needed to pass each resolution and because of the threat of Presidential veto, it is likely to be utilized in this instance, in part because efforts are underway to streamline the process (e.g. H.R. 21 (“Midnight Rules Relief Act of 2017”) would allow the “bundling” of multiple regulations into a single joint resolution) and the same party controls both the Legislative and the Executive branches.

The potential effect of the memo is broadly sweeping, with numerous rules issued by the U.S. Fish and Wildlife Service, National Marine Fisheries Service, and other agencies, particularly in areas relating to endangered species likely to be reviewed and considered for their effects on the regulated communities. For example, on January 25, 2017, the wildlife agencies announced that they would be delaying the effective date for revisions to the Regulations for Candidate Conservation Agreements with Assurances from January 26th to March 21st.  What is certain is that many of the regulations developed at the end of the Obama administration are unlikely to survive this process.

NMFS Publishes Cook Inlet Beluga Whale Recovery Plan

On January 5, 2017, the National Marine Fisheries Service (NMFS) published notice of the availability of the final Recovery Plan for the Cook Inlet Beluga Whale (Delphinapterus leucas).  The Endangered Species Act (ESA) requires the preparation and implementation of recovery plans for all listed species, unless the Secretary of Commerce determines that doing so does not promote the recovery of the species.  NMFS listed the Cook Inlet distinct population segment (DPS) of beluga whale (CI beluga) as endangered under the ESA in 2008 and designated critical habitat in 2011.

Photo: NOAA Fisheries

Approximately 340 CI beluga remained in 2014, down from a high of nearly 1300 in 1979.  The Cook Inlet is a semi-enclosed tidal estuary in southcentral Alaska; CI beluga are the most reproductively and demographically isolated of all the Alaskan beluga whales.  As such, CI beluga are highly susceptible to stochastic events.

The Recovery Plan acknowledges that the reasons for the CI beluga’s decline are not well understood.  In order to focus efforts and resources on actions that are more likely to benefit CI beluga recovery, the Recovery Plan identifies ten potential threat types and rates their overall relative concern to CI beluga.  The Plan focuses recovery efforts on threats identified as of medium or high relative concern including catastrophic events (e.g., natural disasters; spills; mass strandings), cumulative effects of multiple stressors, noise, disease agents (e.g., pathogens, parasites, and harmful algal blooms), habitat loss or degradation, reduction in prey, and unauthorized take.  Threats of low relative concern that will be reassessed from time to time include pollution, predation, and subsistence hunting.

The Recovery Plan specifies a minimum population size of 520 individuals to downlist CI beluga from endangered to threatened and 840 individuals to delist.  Recommended recovery actions include research, monitoring, education/outreach efforts, and threat management, such as evaluating the effect of prey abundance on the DPS’s fitness.

Texas Cactus and Three Other Species Proposed for Downlisting or Delisting by U.S. Fish and Wildlife Service

On December 28, 2016, the U.S. Fish and Wildlife Service (Service) published a proposed rule to reclassify the Tobusch fishhook cactus (Sclerocactus brevihamatus ssp. tobuschii), downlisting the species from endangered to threatened under the Endangered Species Act (ESA).  The Service concluded that, while the Cactus is not in danger of extinction, it is likely to become endangered in the foreseeable future.  This proposed rule and the accompanying 12-month finding were precipitated by the same ESA petition, citizen suit, and settlement agreement that compelled the Service’s recent 12-month finding and proposed rule delisting the black-capped vireo.

The cactus is a diminutive plant endemic to the Edwards Plateau of Central Texas. When listed as endangered in 1979, only four sites were known (two of which had been destroyed by floods) and fewer than 200 individuals were observed.  Since then, the Service has learned that the riparian sites originally identified were atypical, and a great number of populations have been documented in upland sites.  Populations of the species have been confirmed in 105 areas and include over 3,000 individuals.  Based on modeling, the Service estimates a total population of about 480,000 individuals.  Other reasons underlying the species’ original listing (habitat destruction, altered stream flows, and illegal collection) are now considered to have minimal impact on the species.  Yet—due to continued threats from the demographic and genetic consequences of small population sizes and geographic isolation, insect parasitism, feral hog depredation, changes in wildfire cycles and vegetation, and unknown long-term effects of land use changes and climate change—the Service concluded that the species warrants continued listing under the ESA as threatened.  The comment period for the proposed rule downlisting the cactus runs through February 27, 2017.

On January 6, 2017, the Service reached 12-month findings and issued proposed rules for three additional species—lesser long-nosed bat (Leptonycteris curasoae yerbabuenae) (proposed delisting), Kuenzler hedgehog cactus (Echinocereus fendleri var. kuenzleri) (proposed downlisting), and gypsum wild-buckwheat (Eriogonum gypsophilum) (proposed delisting).  Each of these species was included in the same 2016 settlement agreement that drove the Service’s 12-month findings and proposed rules for the Tobusch fishhook cactus and the black-capped vireo.

U.S. Fish & Wildlife Finalizes First-Ever ESA Compensatory Mitigation Policy

On December 27, 2016, the U.S. Fish & Wildlife Service (FWS) issued its final Endangered Species Act (ESA) Compensatory Mitigation Policy (Policy) – the first policy to comprehensively address compensatory mitigation under the ESA.  The Policy applies to all forms of compensatory mitigation involving ESA compliance required or recommended by FWS, including conservation banks, in-lieu fee programs, permittee-responsible mitigation, and other third-party mitigation mechanisms.  It is a step-down policy addressing the compensatory mitigation component of the mitigation hierarchy, as defined in FWS’s revised and final Mitigation Policy (Nov. 21, 2016) (as reported here), which compensates for or offsets “unavoidable impacts after all appropriate and practicable avoidance and minimization measures have been applied.”

The Policy advances and implements a shift from a project-by-project to a landscape-scale approach to mitigation as directed in the Presidential memorandum, “Mitigating Impacts on Natural Resources From Development and Encouraging Related Private Investment” (Nov. 3, 2015).  The Policy further implements the mitigation goal, established in the Presidential memorandum and FWS’s Mitigation Policy, of a net gain or, at a minimum, no net loss, in sensitive natural resources (i.e., listed, proposed, at-risk species, and their habitats), consistent with FWS’s and action agencies’ authorities and responsibilities, as applicable, under the ESA.  As many commenters noted, the mitigation goal of “net gain/no net loss” in the status of species’ conservation is not required under sections 7 or 10 of the ESA.  However, nothing in the ESA precludes FWS from adopting such “enhanced” mitigation goals and recommending mitigation plans accordingly.  Project proponents who implement compensatory mitigation developed to achieve FWS’s enhanced mitigation standard are expected to enjoy such benefits as greater future regulatory certainty and expedited permit processes.

It is a long-held tenet of conservation planning that landscape-level approaches to mitigation can achieve greater conservation benefits by encouraging private investment in compensatory mitigation, thus leveraging economies of scale and incentivizing advance mitigation.  The Policy encourages market-based approaches to mitigation with a preference for conservation banking that consolidates compensatory mitigation on larger landscapes.  According to FWS, the benefits of a comprehensive landscape-level, market-based approach to compensatory mitigation include standardization and greater consistency and transparency in implementation in the ESA, as well as regulatory flexibility and predictability for the regulated community.

Comment Period Open on City of San Diego Vernal Pool HCP

On December 23, 2016, the U.S. Fish and Wildlife Service published a notice of availability and request for public comment in the Federal Register with respect to the draft Environmental Impact Report/Statement (EIR/S) for the City of San Diego Vernal Pool Habitat Conservation Plan (VPHCP).  Comments are due by February 21, 2017.  The species covered by the VPHCP were previously covered by the San Diego Multiple Species Conservation Program, but the portion of that Plan providing coverage for vernal pool species was struck down by the United States District Court for the Southern District of California.  Center for Biological Diversity v. Bartel, 470 F. Supp. 2d 1118 (2006).

The Federal Register notice explains that “[t]he purpose of issuing an ITP to the City would be to permit incidental take of the covered species resulting from local development authorized by the City and conditioned on the City’s minimization and mitigation of the impacts of such take in accordance with an approved VPHCP.”  The alternatives to issuance of an incidental take permit being considered in the EIR/S are no action (i.e., not issuing the permit) and an expanded conservation alternative that provides greater benefits for the covered species.  The covered species are the San Diego fairy shrimp (Branchinecta sandiegonensis), Riverside fairy shrimp (Streptocephalus woottoni), San Diego button celery (Eryngium aristulatum var. parishii), spreading navarretia (Navarretia fossalis), San Diego mesa mint (Pogogyne abramsii), California Orcutt grass (Orcuttia californica), and Otay mesa mint (Pogogyne nudiuscula).

2016 Year-End ESA Round-Up

The last few weeks of 2016 involved several activities relating to the Endangered Species Act (ESA), including the following:

  • On December 27, 2016, the U.S. Fish and Wildlife Service (FWS) issued the final ESA Compensatory Mitigation Policy. According to FWS, the new policy addresses permittee-responsible mitigation, conservation banking, in lieu fee programs, and other third-party mitigation mechanisms, and stresses the need to hold all compensatory mitigation mechanisms to equivalent and effective standards.  The Compensatory Mitigation Policy, which we previously reported on here, is a step-down policy developed under FWS’ new Mitigation Policy, an umbrella policy finalized in November 2016.  For further information regarding the Mitigation Policy, please review our e-alert.  We will be providing more in depth analysis of the new Compensatory Mitigation Policy next week, so please check back with us.
  • On December 21, 2016, FWS and the National Marine Fisheries Service (NMFS) issued the final revised Habitat Conservation Planning Handbook, a joint handbook that describes requirements, procedures, and guidance for permit issuance and habitat conservation plan development for incidental take permits under ESA section 10(a)(1)(B). For further details, please review our prior post on the draft handbook revisions.
  • On December 21, 2016, FWS issued a final rule amending the List of Endangered and Threatened Wildlife. Specifically, FWS removed the current species-level listing of the humpback whale (Megaptera novaeangliae), and in its place listed the Cape Verde Islands/Northwest Africa, Western North Pacific, Central America, and Arabian Sea distinct population segments (DPSs) of humpback whale as endangered, and the Mexico DPS as threatened. Humpback whales in the remaining DPSs will no longer be protected under the ESA. The revisions were previously finalized by NMFS and the final rule simply codifies the revisions to the List of Endangered and Threatened Wildlife, found at 50 C.F.R. § 17.11(h).
  • On December 19, 2016, the U.S. District Court for the District of Oregon enjoined a logging project in the Elliott State Forest based on potential harmful impacts to habitat for the marbled murrelet, which is listed as threatened under the ESA. Cascadia Wildlands v. Scott Timber Co., No. 6:16-CV-01710-AA, 2016 WL 7339201 (D. Or. Dec. 19, 2016). Of particular note, the district court found that plaintiff’s 60-day notice (required under the ESA) was not premature, even though it was provided before any specific logging project had been developed for the property.

We wish you the best in 2017. Happy new year from Nossaman LLP.

Fish and Wildlife Service Proposes De-Listing the Black Capped Vireo

On December 15, 2016, the U.S. Fish and Wildlife Service (Service) published a proposed rule to remove the black-capped vireo (Vireo atricapilla) from the list of Endangered and Threatened Species. The Service has concluded that listing is no longer warranted due to the species’ recovery.

The vireo is a small migratory songbird that breeds and nests in south-central Oklahoma, Texas, and the northern states of Mexico, and winters in Mexico’s western coastal states. The species was initially listed as endangered in October 1987 due to various threats, including nest parasitism by brown-headed cowbirds, and loss of habitat due to urbanization, grazing, and removal of vegetation for range improvement. 52 Fed. Reg. 37,420 (Oct. 6, 1987) . The Service completed a five-year status review for the vireo on June 19, 2007, recommending that the vireo be downlisted from endangered to threatened. However, the Service did not downlist the vireo following its 5-year status review. In July of 2012, the Service received a petition to downlist the vireo from endangered to threatened, filed by the Pacific Legal Foundation, Jim Chilton, the New Mexico Cattle Growers’ Association, New Mexico Farm & Livestock Bureau, New Mexico Federal Lands Council, and the Texas Farm Bureau. The Service found that the petition presented substantial information indicating that downlisting was warranted in September of 2013. 78 Fed. Reg. 55,046 (Sept. 9, 2013) . The Service failed to make a timely 12-month finding, and a complaint filed by the Pacific Legal Foundation on behalf of the petitioners on November 20, 2015 sought to compel the Service to make a 12-month finding on the vireo. See New Mexico Cattle Growers’ Association, et al. v. U.S. Department of the Interior, et al., Case No.1:15-cv-01065-PJK-LF (D. N.M.), filed November 20, 2015 .

Since its listing in 1987, the vireo’s population has increased significantly, with the largest increase in population in Val Verde County, Texas. In addition, the increased usage of prescribed burns significantly increased the amount of suitable breeding habitat in Oklahoma and portions of the species’ range in Texas and Mexico. Management programs have also decreased the rate of brood parasitism by brown-headed cowbirds, and eight habitat conservation plans have been implemented addressing incidental take of vireo. Due to the combination of these factors, the Service determined that the vireo “has recovered so that it no longer meets the definition of endangered or threatened under the [Endangered Species] Act.” The Service will accept comments on the proposed delisting of the vireo for sixty (60) days following publication of its proposed rule.

U.S. Fish and Wildlife Service Issues Annual Candidate Notice

The Candidate Notice of Review is an annual appraisal by the U.S. Fish and Wildlife Service (Service) of plants and animals that are candidates for Endangered Species Act protection.  A “candidate” species is a species for which there is sufficient information to support a proposal for listing as an endangered or threatened species under the Endangered Species Act, but the formal listing determination is delayed because of higher priority listing actions for other species.  The Candidate Notice of Review, among other things, “summarizes the status and threats that [the Service] evaluated in order to determine whether species qualify as candidates, to assign a listing priority number (LPN) to each candidate species, and to determine whether a species should be removed from candidate status.”  In the most recent Candidate Notice of Review, the Service identified 30 candidate species (10 plant and 20 animal species) and changed the listing priority status for one species.  Notably, this represents a substantial reduction in the number of candidate species since the last Candidate Notice of Review was issued in December 2015.  The reductions include 78 species for which the Service published a final listing rule, 18 species for which the Service rescinded the candidate status by publishing a not-warranted finding, and one species for which the Service published a withdrawal of proposed rule.

New Mexico Department of Game and Fish Challenges U.S Fish and Wildlife’s Release of Mexican Wolves

Pending before the U.S. Court of Appeals for the Tenth Circuit is the U.S. Fish and Wildlife Service’s (“Service”) appeal from a district court decision enjoining the Service from releasing Mexican wolves into New Mexico without the requisite state permits. In June 2016, the New Mexico Department of Game and Fish (“Department”) challenged the Service’s intended release of Mexican wolves into an experimental population within the state, without first obtaining the required permits from the Department.  New Mexico moved for a preliminary injunction, which the U.S. District Court for the District of New Mexico granted, after concluding that the Department had shown a likelihood of success on the merits, that it would suffer irreparable injury in the absence of an injunction, and that the balance of harms and the public interest weighed in favor of an injunction.

Oral argument of the appeal is scheduled for January 18, 2017. Notably, eight briefs were filed by amicus curiae in support of the Department, including one by the States of Colorado, Alabama, Alaska, Arizona, Arkansas, Idaho, Kansas, Michigan, Montana, Nebraska, Nevada, New Hampshire, Oklahoma, South Dakota, Texas, Utah, Wisconsin, and Wyoming.

The Mexican gray wolf subspecies (Canis lupus baileyi) has been listed as endangered under the Endangered Species Act (“ESA”) since 1976.  A binational captive-breeding program between the United States and Mexico was established in the late 1970s, with the capture of the last remaining Mexican wolves in the wild.  The captive breeding program originated with seven founding wolves, and has grown to approximately 248 wolves in 55 facilities in the United States and Mexico. In 1998, the Service began releasing surplus wolves from the captive breeding program into the wild.  The wild population – categorized as a non-essential experimental population under the ESA – now contains approximately 100 wolves.

Under New Mexico law, the importation and release of non-domesticated animals, including Mexican wolves, requires a permit from the Department. For activities relating to the population of Mexican wolves that have occurred in New Mexico since the first release in 1998, it has been the Service’s practice to first obtain approval from the Department.

In 2015, the Service applied for the requisite permits in order to import and release wolves into New Mexico. The Department denied the permits for various reasons, including that the Service had not developed a comprehensive, up-to-date management plan regarding the species.  The Service indicated in October 2015 that it intended to move forward with the planned releases, asserting that it did not have to comply with the Department’s permitting requirements.  The Department thereafter sued the Service, alleging the Service violated, among other things, the ESA and the Service’s own regulations.