CHAPTER 8 SURFACE MANAGEMENT AGENCIES REGULATORY UPDATE

• Jurisdiction: United States

Natural Resources and Environmental Administrative Law and Procedure II
(Sep 2004)
CHAPTER 8
SURFACE MANAGEMENT AGENCIES REGULATORY UPDATE
Paul B. Smyth ¹
Acting Associate Solicitor
Division of Land and Water Resources, Office of the Solicitor
United States Deportment of the Interior
Washington, D.C.

Paul B. Smyth is the Acting Associate Solicitor for the Division of Land and Water Resources, in the Department of the Interior's Office of the Solicitor in Washington, D.C. He has served in many other legal capacities at Interior, including serving as Acting Director of Interior's Office of Hearings and Appeals from 1993-94 and serving as counsel to the Department's Energy Task Group that helped to develop Secretary Norton's recommendations to the National Energy Policy Report (May 2001). Mr. Smyth has practiced law for over twenty-nine years and has broad experience in natural resources, energy and environmental law.

Mr. Smyth is formerly a Trustee of the Rocky Mountain Mineral Law Foundation and served for four years as Budget Officer of the ABA's Section of Natural Resources, Energy, and Environmental Law. He also was a Section Council Member and a member of the editorial board for the Section's Natural Resources & Environment magazine, serving as Executive Editor from 1989-91. He was the Chair of the Environmental Law Journal Committee of the ABA's Section of Environment, Energy and Resources through August 2003. He was an adjunct faculty member at George Washington University School of Law from 1997-2000. Mr. Smyth now serves as a board member of EcoVoce, a non-profit corporation whose purpose is to increase environmental awareness through vocal concerts.

Mr. Smyth graduated from Boston College Law School in 1974 and Trinity College in 1971.

Mr. Smyth, in a reverse-bonus deal, starred with the 2000 Boston Red Sox Fantasy Team in Ft. Myers, FL, batting .391.

Table of Contents

I. Introduction

II. Administrative Developments - Public Land Management

A. Recordable Disclaimers of Interest in Land

1. Revised Statute (R.S.) 2477

2. Section 315 of FLPMA

3. 1984 Regulations

4. 2003 Amended Rule

5. Black River Navigability Determination

6. MOU with the State of Utah

7. State of Utah and Juab County Application for the Weiss Highway

B. Grazing Regulations

C. Recreation Regulations

D. Healthy Forests Initiative

1. USDA/DOI Categorical Exclusions under NEPA for Hazardous Fuels Reduction Activities and Rehabilitation Activities

2. BLM and Office of Hearings and Appeals (OHA) Rules

3. Joint Counterpart Endangered Species Act (ESA) Section 7 Consultation Regulations

4. Guidance for Implementing Streamlined Section 7 Programmatic Consultation on Fuels Treatment Projects

5. The Healthy Forests Initiative and Healthy Forests Restoration Act Interim Field Guide

6. Stewardship Contracting

7. Memorandum of Understanding on Policy Principles for Woody Biomass Utilization For Restoration and Fuel Treatments on Forests, Woodlands, and Rangelands

8. Guidance for Environmental Assessments for Healthy Forest Projects

E. BLM's Proposed Rule on Cooperating Agency Role in Developing BLM Land Use Plans

F. BLM's Cost Recovery Rights-of-Way Regulations

III. Administrative Developments -- Onshore Minerals, Mining and Oil and Gas Development

A. BLM's Final Rule on Maintenance Fees

B. BLM's Instruction Memorandum on Best Management Practices - Oil and Gas

C. BLM's Onshore Oil and Gas Order # 1

D. BLM's Proposed Oil Shale Lease Form

E. OSM's AML Reclamation Fees Preliminary Final Rule

F. Mill Site Opinion

G. Mill Site Regulation

H. Implementation Guidance on Mineral Policy Center v. Norton

IV. Administrative Developments - Royalty Valuation Rules

A. MMS' Deep Gas Royalty Regulations

B. 2004 Federal Crude Oil Royalty Valuation Amendments

C. July 2004 Proposed Gas Valuation Regulations

V. Significant Public Land Management Cases

A. Judicial Review under APA - Norton v. Southern Utah Wilderness Alliance (Supreme Court)

B. Significant Litigation Involving R.S. 2477

1. Southwest Four Wheel Drive Ass'n v. BLM

2. Southern Utah Wilderness Alliance v. BLM

3. Board of County Commissioners of Sublette County v. Norton

C. Water Ditch Rights

1. Western Watersheds Project v. Matejko

2. Forest Guardians v. U.S. Forest Service

D. National Monument Litigation

1. Mountain States Legal Foundation v. Bush and Tulare County v. Bush

2. Utah Association of Counties and Mountain States Legal Foundation v. Bush

VI. Significant Cases Involving Onshore Minerals, Mining and Oil & Gas Development

A.. Southern Utah Wilderness Alliance v. Norton (seismic project)

B. Pennaco Energy, Inc. v. United States

C. Wyoming Outdoor Council v. Bosworth

D. Northern Plains Resource Council v. BLM

E. Bedroc v. United States (Supreme Court)

F. Mineral Policy Center v. Norton

G. CEMEX v. County of Los Angeles

VII. Significant Litigation Involving Land Exchanges

A. Western Land Exchange Project v. BLM (Lincoln County land exchange)

B. Desert Citizen Against Pollution v. Gold Fields (challenge to land exchange appraisal)

I. Introduction

The Department of the Interior undertook a number of regulatory and policy initiatives this past year. Some regulatory developments, like BLM's proposed revisions to land use plan regulations, authorize the use of cooperating agency status in the land use planning process reflecting recognition of the importance of working collaboratively, whenever possible and appropriate, with other federal agencies, state and local governments and Indian tribes. Others, like MMS' proposed and final royalty valuation changes amend the basis for valuing crude oil not sold at arm's length, adjust calculations for certain costs, and provide incentives for the exploration and development of deep gas formation to help moderate natural gas supply and price fluctuations. The use of recordable disclaimers is providing certainty by clearing land titles, and regulatory processes under the President's Healthy Forests Initiative are reducing the risk of catastrophic wildfires by restoring forest health.

Additional impacts to the practice of administrative, public lands, mineral and mining law reverberated from the Judicial Branch this past year. From federal district courts to the highest Court, judicial decisions have upheld, clarified and questioned a vast spectrum of natural resource policies and practices at the Department. On June 14, 2004, the Supreme Court ruled in favor of the Department of the Interior on all issues in the important public land management case, Norton v. Southern Utah Wilderness Alliance. ² Earlier this year, the Supreme Court also interpreted a 1919 land-grant statute and left in place the designation of seven National Monuments. The designation of an eighth -- the Grand Staircase-Escalante National Monument -- also was upheld in a long-awaited decision of the U.S. District Court in Utah. This paper highlights these and other important developments in public lands law.

II. Administrative Developments -- Public Land Management

A. Recordable Disclaimers of Interest in Land

Recently, the Department of the Interior utilized the administrative process under the revised recordable disclaimer of interest rules, at 43 C.F.R. Part 1864, to remove a cloud on title to submerged lands in Alaska. Currently, the Department is in the process of utilizing this same process, along with the principles set forth in an MOU with the State of Utah, to determine whether to issue a recordable disclaimer of interest for an R.S. 2477 right-of-way claim in Utah.

1. Revised Statutes (R.S.) 2477

R.S. 2477 was adopted by Congress in 1866 to grant rights-of-way for the construction of highways across public lands not reserved for public uses. In 1976, section 706(a) of FLPMA, 43 U.S.C. § 1701 et seq., repealed R.S. 2477, yet did not terminate the valid rights-of-way established under R.S. 2477 prior to its repeal. ³ The repeal did not provide any time limitation on filing claims for pre-1976 rights-of-way. ⁴

2. Section 315 of FLPMA

Section 315 of FLPMA authorizes the Secretary of the Interior, through a delegation of authority to BLM, to issue a disclaimer of interest in any lands in any form suitable for recording, when the disclaimer will help remove a cloud on the title of such lands and where the Secretary determines that a record interest of the United States in such lands has terminated by operation of law or is otherwise invalid.

3. 1984 Regulations

In 1984, BLM adopted regulations implementing section 315 of FLPMA to set up a process by which disclaimers of interest could be issued. ⁵

4. 2003 Amended Rule

On January 6, 2003, BLM published a final rule that amended its 1984 regulations on recordable disclaimers. ⁶ The rule implements the Secretary of the Interior's authority under section 315 of FLPMA. It does not expand the kinds of circumstances in which a disclaimer could be issued or create any new rights under R.S. 2477. However, the 2003 rule is more consistent with both section 315 of FLPMA (removes certain restrictions that are not required by the statute) and with the Quiet Title Act ⁷ (exempts states from a 12-year statute of limitations). The rule also removes the regulatory requirement that an applicant for a disclaimer of interest be a "present owner of record" and specifies that BLM will not issue a disclaimer of interest over the valid objection of another land managing agency with jurisdiction over the affected lands.

5. Black River Navigability Determination

On October 23, 2003, Assistant Secretary Rebecca Watson granted the State of Alaska's application for a recordable disclaimer of interest for submerged lands underlying navigable portions of the Black River which flows within the external boundaries of the Yukon Flats National Wildlife Refuge. In processing the application, BLM evaluated its own information about the Black River, as well...