Designations and exclusions addressed

The federal Fish and Wildlife Service and National Oceanic and Atmospheric Administration (Services), the two agencies responsible for implementing the Endangered Species Act (ESA), recently took three actions intended to improve and clarify the process of designating areas of critical habitat for listed species and consulting on the effects of federal actions on critical habitat. The actions—two proposals and one draft policy—are described below.

Draft exclusion policy

The draft policy was written to complement an August 28, 2013, rule that included requirements that the Services complete a draft economic analysis and make that analysis available for public comment at the time of publication of a proposed rule to designate critical habitat.

The draft policy relates specifically to ESA Section 4(b)(2), which authorizes the government to designate critical habitat and make subsequent revisions on the basis of the best scientific data available and after considering the economic and national security impacts.

Section 4(b)(2) also indicates that the Services may exclude any area from critical habitat if the Services determine that the benefits of such exclusion outweigh the benefits of specifying the area as part of the critical habitat, unless the available data indicate that an exclusion will result in the extinction of the species of concern.

The Services assert that the ESA provides them with substantial discretion to make critical habitat designations and exclusions.  Specifically, the policy describes how the Services will consider exclusions in light of the following:

• Private or other nonfederal conservation plans and partnerships.  A conservation plan describes actions that minimize and/or mitigate impacts to species and their habitat.  Conservation plans can be developed by private entities with no Service involvement or in partnership with the Services.  In determining whether an exclusion is appropriate, the Services consider factors such as the degree to which the record supports a conclusion that a critical habitat designation would impair benefits expected from the plan or partnership; the extent of public participation in the conservation plan; the degree to which there has been agency review; whether National Environmental Policy Act (NEPA) compliance was required; and the demonstrated implementation and success of the chosen mechanism.
• Private or other nonfederal conservation plans related to ESA Section 10 permits.  Habitat conservation plans (HCPs) for incidental take permits under ESA Section 10(a)(1)(B) provide for partnerships with nonfederal entities to minimize and mitigate impacts to listed species and their habitat.  Candidate conservation agreements with assurances (CCAAs) and safe harbor agreements (SHAs) are voluntary agreements designed to conserve candidate and listed species on nonfederal lands.  In exchange for actions that contribute to conservation, participating property owners are covered by an enhancement of survival permit under Section 10(a)(1)(A), which authorizes incidental take of the covered species that may result from implementation of conservation actions and land uses.  When undertaking a discretional exclusion analysis, the policy states that the Services will also consider areas covered by HCPs, CCAAs, and SHAs provided certain conditions are met (e.g., the party commits to implementing listed actions for the term of the agreement, and the conservation measures undertaken also protect the habitats of similar species).
• Tribal lands.  When undertaking a discretionary exclusion, the Services will always consider exclusions of Tribal lands under Section 4(b)(2) before finalizing a designation of critical habitat and will give great weight to Tribal concerns in analyzing the benefits of exclusion.
• National security.  The Services will always consider for exclusion areas indicated by the Department of Defense (DOD), the Department of Homeland Security (DHS), or other federal agency based on concerns about national security.  However, the policy adds that the Services may not automatically exclude requested areas.  When the DOD, DHS, or another federal agency requests an exclusion from critical habitat for security reasons, it must provide a justification.  Such justification could include demonstration of probable impacts, such as impacts to ongoing border security patrols and surveillance activities because of compliance with the ESA.
• Economic impact.  The Services will use their discretion in determining how to weigh probable economic impacts against conservation value.  For example, if an economic analysis indicates high probable impacts in a proposed critical habitat unit of low conservation value (relative to the remainder of the designation), the Services may consider exclusion of that particular unit.

Defining ‘destruction or adverse modification’

In 1986, the Services established the following definition for “destruction oradverse modification of critical habitat:”  “a direct or indirect alteration that appreciably diminishes the value of critical habitat for both the survival and recovery of a listed species.  Such alterations include, but are not limited to, alterations adversely modifying any of those physical or biological features that were the basis for determining the habitat to be critical.” 

In 2001, the U.S. Court of Appeals for the 5th Circuit ruled that the 1986 regulatory definition exceeded the Services’ discretion.  The court stated that the requirement that both recovery and survival be diminished before adverse modification could be established set too high a threshold.

The court stated that the definition actually established a standard that would trigger an adverse modification determination only if the “survival” of the species was diminished while ignoring the role critical habitat plays in the recovery of species.  In 2004, the 9th Circuit Court of Appeals agreed that the regulatory definition was invalid. 

After considering relevant case law and their experience in applying the destruction or adverse modificationstandard over the last 3 decades, the Services are proposing to amend the definition to more “explicitly tie the definition to the stated purpose of the Act and more clearly contrast the definitions of destruction or adverse modification and jeopardize the continued existence of.” 

Accordingly, the Services propose the following definition:

“Destruction or adverse modification means a direct or indirect alteration that appreciably diminishes the conservation value of critical habitat for listed species.  Such alterations may include, but are not limited to, effects that preclude or significantly delay the development of the physical or biological features that support the life-history needs of the species for recovery.”

The key new phrase in the proposed definition is “conservation value,” which places more emphasis on the recovery of species through the conservation of critical habitat rather than on simple survival of a species. 

“Specifically, the term ‘conservation value’ is intended to capture the role that critical habitat should play for the recovery of listed species,” state the Services.  “We believe by focusing on the conservation value of critical habitat, which also necessarily includes attributes critical to a specie’s survival, this definition will be consistent with the Fifth and Ninth Circuit Court of Appeals decisions.  The Services note that ‘value’ within ‘conservation value’ refers to its utility or importance.  It does not refer to a quantified value.”

In the preamble to the proposal, the Services also address the meaning of “appreciably diminish.”  Prior guidance relied on the definition of appreciable as “noticeable” or “measurable.”  The Services find this definition simplistic because diminishment of conservation value cannot always be noticed or recognized.  The Services now propose to define the term to mean to “recognize the quality, significance, or magnitude” or to “grasp the nature, worth, quality, or significance.” 

“The relevant question, then, becomes whether we can recognize the quality, significance, or magnitude of the diminishment,” state the Services.  “In other words, is there a diminishment to the value of the critical habitat that has some relevance because we can recognize or grasp the quality, significance, magnitude, or worth of the diminishment in a way that affects the conservation value of the critical habitat.”

This definition is a key element in consultations the Services must conduct with other federal agencies.  The consultation provision requires that agencies ensure that any action they authorize, fund, or carry out is “not likely to jeopardize the continued existence of any [listed] species or result in the destruction or adverse modification of [critical habitat].”

Designating critical habitat

According to the Services, the proposed changes to regulations governing the designation of critical habitat will better describe the scope and purpose of critical habitat and clarify the criteria for the designation.

This proposed rule would also revise the Services’ regulations to be consistent with statutory amendments made in 2004, which made certain DOD lands ineligible for designation as critical habitat. The proposed changes include the following:

• Specifying that critical habitat will be proposed and finalized “to the extent prudent and determinable … concurrent with issuing proposed and final [species] listings.”
• Adding examples of factors the Services may consider in determining whether a designation would not be beneficial to the species; for example, “The biological needs of the species are not sufficiently well known to identify any area that meets the definition of critical habitat.”
• Removal of the term “primary constituent elements” from the regulations.  The Services adopted the term, which does not exist in the ESA and which has been used to describe features in specific areas that are important to species.  But its coexistence with “physical or biological features,” a term that is used in the ESA, has proved confusing.  The proposal would replace the added term with the statutory term.
• Clarification that the Services cannot and need not make critical habitat determinations at an “infinitely fine scale.” Thus, the Services need not determine that each square inch, yard, acre, or even mile independently meets the definition of “critical habitat.” 
• A requirement that the Services consider whether physical or biological features essential to the conservation of the species require special management. 
• A change to allow the Services to designate areas unoccupied by the species as critical habitat before consideration of occupied areas is exhausted.  The Services must still find that the unoccupied areas are essential for the conservation of the species.
• Codification of the principle that the designation of critical habitat for species listed before 1978 is at the discretion of the Services.  The definition of critical habitat was added to the ESA in 1978; it provided that the Services may but were not required to establish critical habitat for species already listed by the date of the 1978 amendments.
• A new paragraph would codify the 2004 amendments to the ESA, which prohibit the Services from designating as critical habitat lands or other geographic areas owned or controlled by the DOD or designated for its use if those lands are subject to an integrated natural resources management plan and if the Services determine in writing that such plan provides a benefit to the species for which critical habitat is being designated.

The proposals and draft policy were published in the May 12, 2014, FR.

William C. Schillaci
BSchillaci@blr.com