CHAPTER 8 PROCESS AND PRACTICE TIPS FOR U.S. ARMY CORPS OF ENGINEERS ADMINISTRATIVE APPEALS

• Jurisdiction: United States

Challenging and Defending Federal Natural Resource Agency Decisions
(Sep 2016)
CHAPTER 8
PROCESS AND PRACTICE TIPS FOR U.S. ARMY CORPS OF ENGINEERS ADMINISTRATIVE APPEALS
Aaron C. Courtney
Partner
Stoel Rives LLP
Portland, OR
Olivier Jamin
Lewis & Clark Law School
Portland, OR
Joan E. Drake
Presented By
Shareholder
Modrall Sperling LLP
Albuquerque, NM

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AARON C. COURTNEY is a partner practicing in the Environment, Land Use and Natural Resources group of Stoel Rives LLP in Portland, Oregon. He represents energy, municipal, industrial, agricultural, and developer clients on compliance, permitting, and litigation issues under the Clean Water Act (CWA) (with a particular emphasis on Section 404 and Section 10 permitting), the Endangered Species Act (ESA), the National Environmental Policy Act (NEPA), the Federal Land Policy and Management Act (FLPMA) (focusing on Bureau of Land Management rights-of-way authorizations), and federal and state clean-up laws. Aaron's energy infrastructure work focuses on linear project development (transmission and pipeline) and renewable energy generation project permitting (wind and solar). Aaron also has extensive experience representing clients in formulating mitigation strategies to facilitate such permitting, as well as advising clients in the development of natural resource mitigation banks. His public sector work includes representing numerous public wastewater treatment entities on water quality and distribution matters. He also applies his extensive practical skills in conducting environmental due diligence in support of major mergers and acquisitions matters, (a course he teaches as an adjunct faculty member at Lewis and Clark Law School).

JOAN E. DRAKE is a lawyer with Modrall Sperling in Albuquerque, New Mexico. Joan assists clients with regulatory compliance, litigation strategy, and defense of Section 404 Clean Water Act permits, including Nationwide and Individual Permits, as well as compliance with NEPA and related environmental laws, including the Endangered Species Act and National Historic Preservation Act. Prior to her legal career, Joan was an environmental regulatory specialist with the U.S. Army Corps of Engineers in Los Angeles and New England, focusing on large and controversial civil works and regulatory projects and enforcement matters. Joan offers the unique perspective of both a seasoned regulator and a knowledgeable lawyer.

TABLE OF CONTENTS

I. Introduction

II. Overview Of The Administrative Appeals Process

A. Administrative Appeals Process For Permit Denials, Proffered Permits, And Approved JDs

B. The Review Process

III. A Closer Look At The Appeal Process: What Do The Numbers Tell?

A. Case Studies Of Four Divisions

1. The Great Lakes and Ohio River and South Atlantic Divisions

2. The Mississippi Valley and Southwestern Divisions

B. Putting The Numbers Together

C. A Sample Of Administrative Appeal Decisions

IV. A Review Of Recent Judicial Decisions With Potential Implications On The Corps' Administrative Appeals Process

A. AJDs are now "final agency actions"

B. Another Type Of Final Agency Action: Compliance Orders

C. The Corps' Ability To Narrow The Scope Of Its Permitting Authority

D. The Corps' Preference For Utilizing NWPs

V. Conclusion

An Analysis of the U.S. Corps of Engineers Administrative Appeals Process: Crafted With Good Intentions, Encumbered by Its Own Implementation, But Potentially Headed Towards a Brighter Future

I. Introduction

The Clean Water Act ("CWA") expressly prohibits the discharge of pollutants into the nation's waterways without a permit.¹ Section 404 of the CWA further prohibits the discharge of dredged or fill material in waters of the U.S., (e.g., streams and rivers and wetlands with a nexus thereto), absent a permit from the U.S. Army Corps of Engineers ("Corps").² Often implemented in tandem by the Corps for projects impacting waters formally deemed navigable by the agency, Section 10 of the Rivers and Harbors Act ("RHA") prohibits any activity that could affect the course or condition of such a waterway absent authorization from the Corps.³

Although the CWA and the RHA does not explicitly provide for an administrative process to review the actions of the Corps in administrating the permitting programs, the Corps published a final rule in 2000 establishing "an administrative appeals process that is independent, objective, fair, prompt, and efficient."⁴ The enactment of these regulations was the result of a seven-year process started under President Clinton. Shortly after coming into office in 1993, the Clinton Administration convened an interagency working group to address concerns and issues with federal wetlands policy.⁵ Gathering comments from States, tribes, developers, farmers, environmentalists, Congress, and scientists, the working group developed a comprehensive plan to emphasize wetlands protection, while making wetlands regulations more fair and flexible. The plan was issued on August 24, 1993 and aimed at improving federal wetlands policy through various means, including streamlining wetlands permitting programs.⁶ One important aspect of the plan was the development of an administrative appeals process for Section 404 jurisdictional determinations and permit denials, to be implemented after public rulemaking. On July 19, 1995, the Corps published a notice in the Federal Register of a proposal to establish the appeal process, which expired on September 5, 1995.⁷ The Corps then addressed the issues raised in comments submitted and made changes to the proposed rule. In Fiscal Years 1995 to 1999 the President's budgets have included money to implement an administrative appeals process for permit denials

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and jurisdiction determinations, which was finalized in 2000, about seven years after the Clinton Administration started engaging in this process.⁸

Under the regulations, landowners and permit applicants can appeal jurisdictional determinations ("JDs") or written denials of individual permit applications with prejudice. An applicant can also object to the terms and conditions of an individual permit.⁹ Noteworthy, the appeal process is not available to third parties.¹⁰

The Corps considered but ultimately rejected including in the appeal process review issues such as "the assertion of discretionary authority, issuance of cease and desist orders, special conditions, denial without prejudice of a permit application, and delays in the evaluation of a permit application."¹¹ The Corps decided not to include these issues in the appeal process because many are preliminary in nature, and they were concerned that the administrative record would be incomplete, thus preventing meaningful review.

Although the Corps had additional concerns that an expansive appeal process would result in a serious burden on the Corps, since the process' inception, fewer than 1 percent of individual permit and JDs end up being appealed.¹² Further, as discussed in this article, the number of appeals could drop even further as a result of the recent federal court opinions, including most notably the Supreme Court's decision in U.S. Army Corps of Engineers v. Hawkes Co.,¹³ which held that an approved JD constitutes a final agency action immediately appealable in federal court under the Administrative Procedure Act ("APA"), thus obviating the need for appellants to first go through the administrative appeals process before seeking judicial review.

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As outlined below, when the Corps makes a decision at the District level,¹⁴ the person to whom the decision is directed receives a notice providing the possibility to appeal, a fact sheet describing the process, and a form that the person can use to appeal the decision.¹⁵ The permit applicant or landowner must then file a request for appeal ("RFA") within 60 days of the notice.¹⁶ The Division engineer in charge of overseeing the appeal reviews the RFA and notifies the appellant within 30 days whether the RFA is acceptable or not. If it is incomplete, the appellant will have an opportunity to revise it. If it is acceptable, the Division engineer must issue a final decision in writing within 90 days after the permit applicant or landowner files an appeal.¹⁷ Ultimately, the Division engineer will either uphold the District decision or remand the decision to the District with instructions on how to correct any procedural error or how to reconsider parts of the decision that were not supported by the evidence in the record.¹⁸ Finally, in practice, these timelines are often exceeded and vary depending on the Division involved.¹⁹

This article aims at providing an overview of the Corps' administrative process, including the way appeals are being disposed of, statistics on delays and success rates, and circumstances that can help or undermine an appeal. A good understanding of the administrative appeals process, and how to frame a RFA, can sometimes be essential, as this process is often a prerequisite to judicial review in federal court.²⁰ The first section of this article will provide a brief overview of the administrative appeals process as provided for in the regulations. The second section will then provide a more in-depth analysis of how appeals are actually dealt with, and the hurdles that appellants face in the process. The third section will review the most significant cases involving the Corps' administrative appeals process and analyze how they will affect the appeal process moving forward.

II. Overview Of The Administrative Appeals Process

In general, the Section 404 permitting process begins with a JD to ensure that the area that might be impacted in question meets the definition of "waters of the United States." If the Corps finds that it has jurisdiction over the area, the applicant must submit an application to the District engineer for that region. Once in possession of a permit application, the Corps...