83 FR 36469 - Endangered and Threatened Wildlife and Plants; Endangered Species Act Compensatory Mitigation Policy

DEPARTMENT OF THE INTERIOR
Fish and Wildlife Service

Federal Register Volume 83, Issue 146 (July 30, 2018)

We, the U.S. Fish and Wildlife Service (Service), announce we are withdrawing the Endangered Species Act (ESA) Compensatory Mitigation Policy, published December 27, 2016 (ESA-CMP). In our document of November 6, 2017 we requested additional public comments regarding the policy's overall mitigation planning goal of net conservation gain. We are now withdrawing this policy. The Service does not have authority to require ``net conservation gain'' under the ESA, and the policy is inconsistent with current Executive branch policy. Except as otherwise specified, all policies or guidance documents that were superseded by ESA-CMP are reinstated.

[Federal Register Volume 83, Number 146 (Monday, July 30, 2018)]
[Rules and Regulations]
[Pages 36469-36472]
From the Federal Register Online  [www.thefederalregister.org]
[FR Doc No: 2018-16171]


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DEPARTMENT OF THE INTERIOR

Fish and Wildlife Service

50 CFR Chapter I

[Docket No. FWS-HQ-ES-2015-0165; FXES11140900000-178; FF09E33000]


Endangered and Threatened Wildlife and Plants; Endangered Species 
Act Compensatory Mitigation Policy

AGENCY: Fish and Wildlife Service, Interior.

ACTION: Policy; withdrawal.

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SUMMARY: We, the U.S. Fish and Wildlife Service (Service), announce we 
are withdrawing the Endangered Species Act (ESA) Compensatory 
Mitigation Policy, published December 27, 2016 (ESA-CMP). In our 
document of November 6, 2017 we requested additional public comments 
regarding the policy's overall mitigation planning goal of net 
conservation gain. We are now withdrawing this policy. The Service does 
not have authority to require ``net conservation gain'' under the ESA, 
and the policy is inconsistent with current Executive branch policy. 
Except as otherwise specified, all policies or guidance documents that 
were superseded by ESA-CMP are reinstated.

DATES: Withdrawal effective on July 30, 2018.

ADDRESSES: Comments and materials received, as well as supporting 
documentation, are available on the internet at http://www.regulations.gov at Docket Number FWS-HQ-ES-2015-0165.

FOR FURTHER INFORMATION CONTACT: Craig Aubrey, U.S. Fish and Wildlife 
Service, Division of Environmental Review, 5275 Leesburg Pike, Falls 
Church, VA 22041-3803, telephone 703-358-2442.

SUPPLEMENTARY INFORMATION: The ESA-CMP (81 FR 95316, December 27, 2016) 
was developed to ensure consistency with existing directives in effect 
at the time of issuance, including former President Obama's Memorandum 
on Mitigating Impacts on Natural Resources From Development and 
Encouraging Related Private Investment (November 3, 2015). Under the 
memorandum, all Federal mitigation policies were directed to clearly 
set a net-benefit goal or, at minimum, a no-net-loss goal for natural 
resources, wherever doing so is allowed by existing statutory authority 
and is consistent with agency mission and established natural resource 
objectives. The Presidential Memorandum was subsequently rescinded by 
Executive Order 13783, ``Promoting Energy Independence and Economic 
Growth'' (March 28, 2017).
    The ESA-CMP also described its consistency with the Secretary of 
the Interior's Order 3330 on Improving Mitigation Policies and 
Practices of the Department of the Interior (October 31, 2013), which 
established a Department-wide mitigation strategy to ensure consistency 
and efficiency in the review and permitting of infrastructure-
development projects and in conserving natural and cultural resources. 
The Secretary's Order was subsequently revoked by Secretary of the 
Interior's Order 3349 on American Energy Independence (March 29, 2017). 
It directed Department of the Interior bureaus to reexamine mitigation 
policies and practices to better balance conservation strategies and 
policies with job creation for American families.
    In light of the revocation of the 2015 Presidential Memorandum and 
Secretary's Order 3330, on November 6, 2017, the Service requested 
comment on the ESA-CMP, along with the Service-Wide Mitigation Policy 
(81 FR 83440, November 21, 2016), specifically ``regarding whether to 
retain or remove net conservation gain as a mitigation planning goal 
within our mitigation policies.'' Mitigation Policies of the U.S. Fish 
and Wildlife Service; Request for Comment (82 FR 51382, 51383, November 
6, 2017). The comment period for this request ended on January 5, 2018.
    Under Supreme Court precedent, the Takings Clause of the Fifth 
Amendment of the United States Constitution limits the ability of 
government to require monetary exactions as a condition of permitting 
private activities, particularly private activities on private 
property. In Koontz v. St. Johns River Water Management District, 570 
U.S. 595 (2013), the Supreme Court held that a proposal to fund offsite 
mitigation proposed by the State of Florida as a condition of granting 
a land-use permit must satisfy the test established in Nollan v. 
California Coastal Commission, 483 U.S. 825 (1987), and Dolan v. City 
of Tigard, 512 U.S. 374 (1994). Specifically, ``a unit of government 
may not condition the approval of a land-use permit on the owner's 
relinquishment of a portion of his property unless there is a `nexus' 
and `rough proportionality' between the government's demand and the 
effects of the proposed land use.'' Id. at 599. Compensatory mitigation 
raises serious questions of whether there is a sufficient nexus between 
the potential harm and the proposed remedy to satisfy constitutional 
muster.
    Further, because by definition compensatory mitigation does not 
directly avoid or minimize the anticipated harm, its application is 
particularly ripe for abuse. At times the nexus between a proposed 
undertaking and compensatory mitigation requirements is far from clear. 
These concerns are particularly acute when coupled with a net 
conservation gain goal, which necessarily seeks to go beyond mitigating 
actual or anticipated harm to forcing participants to pay to address 
harms they, by definition, did not cause.
    In light of the change in national policy reflected in Executive 
Order

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13783 and Secretary's Order 3349, the comments received by the Service, 
and concerns regarding the legal and policy implications of a net 
conservation gain goal, the Service has concluded that it is no longer 
appropriate to retain a net conservation gain standard in the Service's 
overall mitigation planning goal within the ESA-CMP. Because the net 
conservation gain standard is so prevalent throughout the ESA-CMP, the 
Service is implementing this conclusion by withdrawing it.

Summary of Comments and Responses

    Executive Order 13783--``Promoting Energy Independence and Economic 
Growth'' (March 28, 2017)--rescinded the Presidential Memorandum on 
Mitigating Impacts on Natural Resources from Development and 
Encouraging Related Private Investment. The Secretary of the Interior 
subsequently issued Secretarial Order 3349 on American Energy 
Independence (March 29, 2017), which directed Department of the 
Interior (DOI) bureaus to reexamine mitigation policies and practices 
to better balance conservation strategies and policies with job 
creation for American families. Pursuant to Secretarial Order 3349, we 
published a notice on November 6, 2017 (82 FR 51382) requesting 
additional public comments specifically addressing the advisability of 
retaining or removing references to net conservation gain as a 
mitigation planning goal within our mitigation policies. In addition, 
in carrying out Executive Order 13777, ``Enforcing the Regulatory 
Reform Agenda,'' DOI published a document with the title ``Regulatory 
Reform'' in the Federal Register of June 22, 2017 (82 FR 28429). The 
document requested public comment on how DOI can improve implementation 
of regulatory reform initiatives and policies and identify regulations 
for repeal, replacement, or modification. This notice addresses 
comments that DOI has received in response to the regulatory reform 
docket that relates to the Service's use of mitigation.
    During the combined comment periods, for the ESA-CMP we received 
approximately 335 public comment letters, including comments from 
Federal, State, and local government entities; industry; trade 
associations; conservation organizations; nongovernmental 
organizations; private citizens; and others. The range of comments 
varied from those that provided general statements of support or 
opposition to the draft and final 2016 ESA-CMP, to those that provided 
extensive comments and information supporting or opposing the draft and 
final 2016 ESA-CMP.
    We considered all of the comments we received in the comment period 
beginning November 6, 2017 (82 FR 51382), and following the DOI's 
``Regulatory Reform'' Federal Register announcement (June 22, 2017, 82 
FR 28429); we respond to the substantive comments below.

A. Authority To Include Net Conservation Gain or No Net Loss Under the 
ESA

    Comment (1): One commenter stated there were constitutional limits 
on requiring mitigation, referencing the Koontz v. St. Johns River 
Water Management District case decided by the U.S. Supreme Court, 570 
U.S. 595 (2013). This commenter noted that any compensatory mitigation 
measures must have an essential nexus with the proposed impacts and be 
roughly proportional, or have a reasonable relationship between the 
permit conditions required and the impacts of the proposed development 
being addressed by those permit conditions.
    Response: The Service agrees that the Koontz case, as well as 
predecessor cases including, but not limited to, Nollan v. California 
Coastal Commission, 483 U.S. 825 (1987), and Dolan v. City of Tigard, 
512 U.S. 374 (1994), raise serious constitutional concerns about the 
viability of some elements of compensatory-mitigation programs. These 
concerns are particularly acute for offsite compensatory-mitigation 
programs and programs that seek a net conservation gain. Offsite 
compensatory-mitigation programs raise concerns regarding an 
appropriate nexus between the anticipated impact and the mitigation 
requirement. As mitigation moves further away from the direct impacts 
of a project, the risk that the connection between required 
compensation and the initial project becomes more attenuated increases. 
Further, by seeking to err on the side of mitigating above and beyond 
the impacts of the specific project at issue, the net conservation gain 
standard raises inherent concerns about proportionality, as well as the 
appropriate nexus between project impacts and mitigation methods, 
particularly where mitigation is in essence being used to rectify past, 
unrelated harms. We, like all agencies, must implement our authorities 
consistent with any applicable case law as appropriate. Consideration 
of the Constitutional standard set forth in Koontz is one reason, 
though not the only reason, that the Service is withdrawing its 
previous Mitigation Policy and ESA-CMP. In light of the Koontz case and 
any other relevant court decisions, the Service, in using its previous 
guidance (e.g., 2003 guidance on the establishment, use, and operation 
of conservation banks (68 FR 24753, May 8, 2003) and 2008 recovery 
crediting guidance (73 FR 44761, July 31, 2008)), will make sure that 
any statutorily authorized mitigation measures will have a clear 
connection (i.e., have an essential nexus) and be commensurate (i.e., 
have rough proportionality) to the impact of the project or action 
under consideration.
    Comment (2): Many commenters addressed the mitigation planning goal 
of improving (i.e., a net gain) or, at minimum, maintaining (i.e., no 
net loss) the current status of affected resources. A number of 
commenters supported the goal while a number of commenters opposed the 
inclusion of a net conservation gain. Of commenters opposed to net 
conservation gain, their specific reasons included:
    (a) The Service lacks the statutory authority to implement the net 
conservation gain goal for mitigation planning;
    (b) the net conservation gain goal imposes a new standard for 
mitigation and that mitigation requirements should be commensurate with 
the level of impacts;
    (c) concern about the costs associated with achieving net 
conservation gain;
    (d) questions about the ability to achieve net conservation gain 
and how it would be measured;
    (e) the ESA-CMP does not provide the methodology to assess or 
measure the net conservation gain; and
    (f) net conservation gain is incompatible with the standards of ESA 
sections 7 and 10.
    Also, several commenters asserted that a mitigation planning goal 
of no net loss is inconsistent with the ESA and exceeds our authorities 
under the ESA.
    Response: The ESA requires neither ``net conservation benefit'' nor 
``no net loss,'' and the Service has not previous required a ``net 
benefit'' nor ``no net loss'' while implementing the ESA. Under the 
ESA, the standard for section 7 is that a ``Federal agency shall, in 
consultation with and with the assistance of the Secretary, insure that 
any action . . . is not likely to jeopardize the continued existence of 
any endangered species or threatened species or result in the 
destruction or adverse modification of habitat.'' (Sec.  7(a)(2)); 
under section 10 the requirement is ``to the maximum extent 
practicable, minimize and mitigate the impacts of such taking'' (Sec.  
10(a)(2)(B)(ii)). As one court has

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noted, ``[t]he words `maximum extent practicable' signify that the 
applicant may do something less than fully minimize and mitigate the 
impacts of the take where to do more would not be practicable. 
Moreover, the statutory language does not suggest that an applicant 
must ever do more than mitigate the effect of its take of species.'' 
National Wildlife Federation v. Norton, 306 F. Supp. 2d 920, 928 (E.D. 
Cal. 2004); see also Union Neighbors United, Inc. v. Jewell, 831 F.3d 
564 (D.C. Cir. 2016) (holding that the obligation to minimize and 
mitigate to the maximum extent practicable was satisfied by a plan that 
the Service found to fully offset the impact of the proposed taking). 
Since what is ``practicable'' may not fully offset proposed take, the 
``maximum extent practicable'' standard is inconsistent with both a 
general net conservation gain and no-net-loss mitigation objective. 
Nothing in the ESA requires that the Service apply a net conservation 
gain or no net loss standard.
    Those commenters supporting the goal generally asserted, among 
other points, that the Service has the authority to require 
compensatory mitigation, found the measures to be clear, and thought 
the policy encouraged consistent implementation. While we appreciate 
these comments, for the reasons described above, we are not persuaded.
    As noted above, because the concepts of ``net conservation gain'' 
and ``no net loss'' were central to and embedded throughout the 
policies, modifying the policies would likely have caused significant 
confusion. This fact, together with the more recently issued Executive 
and Secretarial Orders that questioned ``net gain,'' lead to our 
decision here to withdraw the ESA-CMP.

B. Landscape-Scale Approach

    Comment (3): Several commenters described their concerns with the 
implications of the ESA-CMP's landscape-scale approach including:
    (a) There is no statutory authority for taking a landscape-scale 
approach;
    (b) Including a landscape-scale approach would lead to the Service 
seeking mitigation for impacts beyond a project under review, including 
impacts that happened in the past or in unrelated locations;
    (c) A general concern that a landscape-scale approach would mean 
Federal overreach, including disregard for the plans, processes, and 
resource interests of States, Tribes, and local governments.
    Response: We agree with commenters that proponents' and action 
agencies' responsibilities include the provisions of relevant 
authorities and that those responsibilities do not extend to impacts 
unrelated to their action. Requiring mitigation to impacts unrelated to 
a proponent's action would likely conflict with the ``essential nexus'' 
required under Koontz for property development (see Comment 1 above). 
Accordingly, any effort to apply a landscape-scale approach to 
mitigation must ensure that there is an essential nexus between the 
proposed activity and the contemplated mitigation and that mitigation 
is not being imposed to correct for past impacts by other actors.

C. Authority To Include Candidate or At-Risk Species

    Comment (4): Several commenters stated that the Service has no 
statutory authority under the ESA to include candidate or at-risk 
species in compensatory-mitigation mechanisms.
    Response: The commenter is correct that the Service cannot require 
the inclusion of compensatory mitigation for impacts to at-risk and 
candidate species. Including candidate or other at-risk species in 
mitigation would be voluntary on the part of the Federal agency or 
applicant, which may, if the species is listed, streamline future 
reinitiation of consultation or amendments to habitat conservation 
plans (HCPs). Under section 10 of the ESA, although the applicant 
voluntarily develops its HCPs in consultation with the Service, the 
applicant ultimately decides which candidate or non-listed at-risk 
species it desires to include in its HCP. Many applicants voluntarily 
include at-risk species in their HCPs to receive ``no surprises'' 
assurances and preclude the need to amend the associated incidental 
take permit, should the species become listed in the future. This is 
consistent with ESA goals of recovering listed species and, ideally, 
avoiding the need to list species because threats to them have been 
addressed. Furthermore, applicants may include candidate or other at-
risk species to address State or other local requirements (e.g., 
California's Natural Community Conservation Planning Act). But in all 
cases, considerations of non-ESA-listed species are voluntary on the 
part of the Federal agency or applicant.
National Environmental Policy Act (NEPA)
    We have analyzed the withdrawal of this policy in accordance with 
the criteria of the National Environmental Policy Act, as amended 
(NEPA) (42 U.S.C. 4332(c)), the Council on Environmental Quality's 
Regulations for Implementing the Procedural Provisions of NEPA (40 CFR 
parts 1500-1508), and the Department of the Interior's NEPA procedures 
(516 DM 2 and 8; 43 CFR part 46). Issuance of policies, directives, 
regulations, and guidelines that are of an administrative, financial, 
legal, technical, or procedural nature, or whose environmental effects 
are too broad, speculative, or conjectural to lend themselves to 
meaningful analysis and will later be subject to the NEPA process, 
either collectively or case-by-case may be categorically excluded under 
NEPA (43 CFR 46.210(i)). We have determined that a categorical 
exclusion applies to withdrawing this policy.
Paperwork Reduction Act of 1995
    This policy withdrawal does not contain any new collections of 
information that require approval by the Office of Management and 
Budget (OMB) under the Paperwork Reduction Act of 1995 (44 U.S.C. 3501 
et seq.). OMB has reviewed and approved the information collection 
requirements for applications for incidental take permits, annual 
reports, and notifications of incidental take for native endangered and 
threatened species for safe harbor agreements, candidate conservation 
agreements with assurances, and habitat conservation plans under OMB 
Control Number 1018-0094, which expires on March 31, 2019. We may not 
conduct or sponsor and a person is not required to respond to a 
collection of information unless it displays a currently valid OMB 
control number.
Government-to-Government Relationship With Tribes
    In accordance with the President's memorandum of April 29, 1994, 
``Government-to-Government Relations with Native American Tribal 
Governments'' (59 FR 22951), Executive Order 13175 ``Consultation and 
Coordination with Indian Tribal Governments,'' and the Department of 
the Interior Manual at 512 DM 2, we have considered possible effects on 
federally recognized Indian tribes and have determined that there are 
no potential adverse effects of withdrawing this policy. Our intent 
with withdrawing these policies is to reduce confusion of mitigation 
programs, projects, and measures, including those taken on Tribal 
lands. We will work with Tribes as applicants proposing mitigation as 
part of proposed actions and with Tribes as mitigation sponsors.

Authority

    The multiple authorities for this action include the: Endangered 
Species

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Act of 1973, as amended (16 U.S.C. 1531 et seq.); Fish and Wildlife 
Coordination Act, as amended, (16 U.S.C. 661-667(e)); and National 
Environmental Policy Act (42 U.S.C. 4371 et seq.).

    Dated: July 24, 2018.
Gregory J. Sheehan,
Principal Deputy Director, U.S. Fish and Wildlife Service.
[FR Doc. 2018-16171 Filed 7-27-18; 8:45 am]
 BILLING CODE 4333-15-P