The Tenth Circuit Court of Appeals has upheld a U.S. Army Corps of Engineers (Corps) permit for a Burlington Northern Santa Fe Railway (BNSF ) rail yard in Gardner, Kansas, against claims that the permit violated the National Environmental Policy Act (NE PA) and Clean Water Act (CW A). Hillsdale Envtl. Loss Prevention, Inc. v. Corps, No. 11-3210 (10th Cir. 11/28/12). The Corps issued its permit to allow earth-moving operations to fill streams and wetlands at the site.

The Corps determined that the Gardner site was the least environmentally damaging alternative for the expanded intermodal yard, as required by the CW A, relying in part on BNSF ’s express needs, including proximity to existing railroads and a distance not greater than 30 miles from an existing, now-undersized BNSF yard in Kansas City. The Corps also prepared an environmental assessment (EA) and issued a finding of no significant impact (FONSI ) for the permit.

Although the permit contemplated impacts to 17,302 linear feet of streams and 4.61 acres of wetlands, BNSF agreed to reroute 9,100 linear feet of streams, create 7.18 acres of wetlands and restore a large, degraded wetland on the site. The EA assessed potential air quality impacts from the proposed facility using a BNSF analysis prepared with oversight and input from federal and state regulators. Operational air emissions were found to have no significant impact, in part because without the new rail yard, emissions from trucking operations handling freight would increase. The Corps found that the only potentially significant air impact would be from fugitive dust. The Kansas Department of Health and Environment (KDHE ) and BNSF entered into an agreement requiring BNSF to monitor and control dust emissions, and the Corps determined that this eliminated fugitive dust as a concern for the EA’s purposes.

Relying on the FONSI , the Corps issued the permit, and plaintiffs sued, challenging the Corps’s CW A compliance and the ES A. The district court upheld the Corps permit, and plaintiffs filed an appeal to the Tenth Circuit, at the same time seeking an injunction against construction pending appeal, which the Tenth Circuit denied. Construction proceeded, and the Corps filed a motion asserting that the case was moot because the rail yard was 65 percent complete.

The court found that the NE PA case was neither constitutionally nor prudentially moot, because “if we find the Corps’s environmental assessment was defective and remand for further analysis, new information revealed by that analysis could motivate the Corps to revise its decision by, for example, requiring additional mitigation.” It concluded that the case for mootness was closer on the CW A claims because essentially all the regulated waters had already been filled, but did not decide the issue, since the plaintiffs’ claims failed on the merits.

The Tenth Circuit upheld the Corps’s alternative site analysis under the CW A, finding that the Corps had adequately explained the reason each potential alternative site was unacceptable. The court also found that the Corps appropriately assessed the validity of each of BNSF ’s site criteria, although plaintiffs had claimed that the Corps should have required greater justification from BNSF for each criterion. The court upheld the Corps’s NE PA analysis as to fugitive air emissions, concluding that the Corps had appropriately determined that the KDHE and BNSF agreement adequately addressed those emissions. It also upheld the Corps’s NE PA assessment of other potential air impacts against several challenges. For example, the plaintiffs sought to force the Corps to use a California modeling methodology that it had used in the past. The court, however, found that the Corps’s use of the California method for projects in California and different methods elsewhere was rational.

The court also upheld the Corps’s conclusion that impacts to surface and ground water were not significant and did not require an environmental impact statement. In particular, the court found persuasive the Corps’s reasons for concluding that groundwater risks were minimal—that is, “the project area will mostly be paved or impervious, there will be no underground storage tanks onsite, and the project area consists of clay soil, which has a low hydraulic conductivity.”