The Ninth Circuit Court of Appeals has ordered the U.S. Department of the Interior to reconsider its environmental evaluation of a 678-mile natural gas pipeline. Ctr. for Biological Diversity v. U.S. Bureau of Land Management, No. 10-72356 (9th Cir. 10/22/12). At issue was the Bureau of Land Management’s (BLM’s) decision to authorize the Ruby Pipeline, which would place a 42-inch natural gas pipeline from Wyoming to Oregon.

As required by the Endangered Species Act (ESA), the Fish and Wildlife Service (FWS) issued a biological opinion and incidental take statement which concluded that while the construction and operation of the pipeline “would adversely affect” endangered and threatened fish, it “would not jeopardize these species or adversely modify their critical habitat.” Relying on that opinion, BLM approved the pipeline. Plaintiffs challenged the governmental action, claiming in part that the agencies improperly considered protective measures that were not enforceable under the ESA and did not account for “the potential impacts of withdrawing 337.8-million gallons of groundwater from sixty-four wells along the pipeline.”

Because construction would involve 209 water bodies that fall within or connect to critical habitat for listed species, Ruby Pipeline, LLC (Ruby) negotiated an agreement for a conservation action plan to reduce the net impact to the endangered species. Ultimately, the action plan was not, as FWS originally suggested, included in the Federal Energy Regulatory Commission (FERC) filings. It became instead the subject of a letter of commitment that specifically provided, “This Plan is not part of the FERC proposed action for ESA consultation and also is separate from, and in addition to, any reasonable and prudent measures developed as part of the Section 7 consultation with the [FWS] for the Project.” Although BLM and FERC could impose “potentially stiff consequences” if Ruby did not implement the plan, FWS could not directly enforce those requirements under the ESA.

The FWS biological opinion relied in part on the plan to conclude that the project would not jeopardize the continued existence of the listed fish or adversely modify critical habitat. The court found that FWS’s inability to enforce the plan meant that it could not form part of the biological opinion and articulated what the court characterized as new law: “We now hold what was implicit in Marsh and Selkirk and is dictated by the statutory scheme: a conservation agreement entered into by the action agency to mitigate the impact of a contemplated action on listed species must be enforceable under the ESA to factor into the FWS’s ‘biological opinion as to whether [an] action, taken together with cumulative effects, is likely to jeopardize the continued existence of listed species or result in the destruction or adverse modification of critical habitat.’” Because the biological opinion relied on the unenforceable plan, the court ruled that it was arbitrary and capricious.

The court also faulted the government agencies on a second ground. “Although Ruby proposed to use both groundwater and surface water for hydrostatic testing and dust abatement, the Biological Opinion discussed only the likely impacts of surface water withdrawals on listed fish species. It did not address what effects, if any the groundwater withdrawals would likely have.” No other information about geological formations to be used, well depths or other factors is reflected in the court’s opinion. Noting that surface and groundwater may be interconnected, the court held that FWS had not properly assessed whether the groundwater use may harm the listed species by affecting flows in critical habitat.

Because the court found the biological opinion defective and BLM’s reliance on the defective opinion violated its “duty to ensure that its authorization of the Project would not jeopardize the survival of the nine listed fish or adversely modify the species’ critical habitat,” the court vacated and remanded the agency actions.