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Delaware Riverkeeper Network v. United States Army Corps of En, 17-1506 (2017)

Court: Court of Appeals for the Third Circuit Number: 17-1506 Visitors: 6
Filed: Aug. 23, 2017
Latest Update: Mar. 03, 2020
Summary: PRECEDENTIAL UNITED STATES COURT OF APPEALS FOR THE THIRD CIRCUIT _ No. 17-1506 _ DELAWARE RIVERKEEPER NETWORK; MAYA VAN ROSSUM, the Delaware Riverkeeper, Petitioners v. UNITED STATES ARMY CORPS OF ENGINEERS, Respondent Tennessee Gas Pipeline Co., Intervenor _ On Petition for Review from the United States Army Corps of Engineers CENAP-OP-R-2015-0802-65 Argued July 13, 2017 Before: SMITH, Chief Judge, NYGAARD, and FUENTES, Circuit Judges (Filed: August 23, 2017) Aaron J. Stemplewicz [ARGUED] De
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                                 PRECEDENTIAL


    UNITED STATES COURT OF APPEALS
         FOR THE THIRD CIRCUIT
              _____________

                  No. 17-1506
                 _____________

  DELAWARE RIVERKEEPER NETWORK;
MAYA VAN ROSSUM, the Delaware Riverkeeper,
                                  Petitioners

                        v.

UNITED STATES ARMY CORPS OF ENGINEERS,
                               Respondent

           Tennessee Gas Pipeline Co.,
                                    Intervenor
                _____________

On Petition for Review from the United States Army
                 Corps of Engineers
           CENAP-OP-R-2015-0802-65

              Argued July 13, 2017

  Before: SMITH, Chief Judge, NYGAARD, and
           FUENTES, Circuit Judges
                (Filed: August 23, 2017)


Aaron J. Stemplewicz                  [ARGUED]
Delaware Riverkeeper Network
925 Canal Street
Suite 3701
Bristol, PA 19007
       Counsel for Petitioners

Varu Chilakamarri                   [ARGUED]
United States Department of Justice
Environment & Natural Resources Division
P.O. Box 7415
Washington, DC 20044

Michael T. Gray
United States Department of Justice
Army Corps of Engineers
701 San Marco Boulevard
Jacksonville, FL 32207

David C. Shilton
United States Department of Justice
Environment & Natural Resources Division
P.O. Box 23795
L’Enfant Plaza Station
Washington, DC 20026
                           2
      Counsel for Respondent

Pamela S. Goodwin
Saul Ewing
650 College Road East
Suite 4000
Princeton, NJ 08540

Patrick F. Nugent
John F. Stoviak                     [ARGUED]
Saul Ewing
1500 Market Street
Centre Square West, 38th Floor
Philadelphia, PA 19102

Elizabeth U. Witmer
Saul Ewing
1200 Liberty Ridge Drive
Wayne, PA 19087
      Counsel for Intervenor Respondent

                  ________________

             OPINION OF THE COURT
                ________________

SMITH, Chief Judge.


                           3
    Tennessee Gas Pipeline Co. (“Tennessee Gas”)
submitted applications to several federal and state
agencies seeking approval to build an interstate pipeline
project. One such agency is the United States Army Corps
of Engineers, 1 which administers certain provisions of the
Clean Water Act. The Corps issued a permit approving the
project. The petitioners, Maya van Rossum and Delaware
Riverkeeper Network (collectively, “Riverkeeper”),
challenge that decision on the ground that the Corps acted
arbitrarily and capriciously by rejecting a “compression”
alternative.

    We conclude that the Corps considered the
compression alternative but rejected it for reasons
supported by the record. While the compression
alternative would disturb less land, its impact would be
mostly permanent. The pipeline project would disturb
more land, but its impact would be mostly temporary. In
making a policy choice between those environmental
tradeoffs, the agency’s discretion was at its apex. We will
therefore deny the petition for review.




   1
      A companion case addresses challenges to the
Pennsylvania Department of Environmental Protection,
which granted a permit under state law approving the
pipeline project. See Del. Riverkeeper Network v. Sec’y
Pa. Dep’t of Envtl. Prot., No. 17-1533 (3d Cir. 2017).
                            4
                             I

                            A
   At issue is the Orion Project—12.9 miles of pipeline
looping2 that would transport an additional 135,000
dekatherms per day of natural gas through Pennsylvania.
Approximately 99.5% of the new pipeline would run
alongside existing pipelines. According to Riverkeeper,
construction will lead to deforestation, destruction of
wetland habitats, and other forms of environmental
damage. Riverkeeper asserts that such damage can be
avoided by building or upgrading a compressor station.
“Compressor stations . . . us[e] gas- and electric-powered
turbines to increase the pressure and rate of flow at given
points along the pipeline’s route.” Del. Riverkeeper

   2
     “Installation of ‘looping’ along a pipeline involves
the construction of ‘additional sections of pipe, laid
parallel to portions of the existing pipe, which empty into
the existing pipe at both ends of the loop pipeline.’”
Algonquin Gas Transmission Co. v. F.E.R.C., 
948 F.2d 1305
, 1309 n.4 (D.C. Cir. 1991) (further internal quotation
marks omitted) (quoting ANR Pipeline Co. v. F.E.R.C.,
771 F.2d 507
, 510 (D.C. Cir. 1985)); see also Del.
Riverkeeper Network v. Sec’y Pa. Dep’t of Envtl. Prot., 
833 F.3d 360
, 369 (3d Cir. 2016) (“‘Loops’ are sections of pipe
connected to the main pipeline system that reduce the loss
of gas pressure and increase the flow efficiency of the
system.”).
                            5
Network v. Sec’y Pa. Dep’t of Envtl. Prot., 
833 F.3d 360
,
369 (3d Cir. 2016). Building or upgrading a compressor
station would increase the amount of natural gas
transported through existing pipelines and thus avoid any
need to build pipeline looping.3

   Contrary to Riverkeeper’s concerns, the agencies
concluded that the Orion Project would result in
“minimal” and “temporary” environmental impact. Of the
12.9 miles of pipeline looping, fewer than 2 miles would
cross wetlands or waterbodies. The pipeline would be
buried 2–3 feet beneath the ground, and all disturbed areas
would be restored to their original elevations and contours
with no net loss of wetlands. However, nearly five acres of
forested wetlands would be de-forested and converted into
emergent wetlands. The compression alternative, by
contrast, would require constructing one or more
permanent fixtures—causing permanent deforestation as
well as light, air, sound, and greenhouse gas pollution.




   3
      The parties focus primarily on building one or more
new compressor stations rather than upgrading an existing
station. See JA 2010 (“[U]pgrades to existing compressor
stations, without looping, did not offer the same reliability
and flexibility on the system.”). We focus our analysis
accordingly.
                             6
   With that initial background in mind, we next set forth
a brief overview of the administrative scheme and then
describe how that process unfolded in this case.
                            B

   Under the Natural Gas Act of 1938, the Federal Energy
Regulatory Commission (“FERC”) is the “lead agency”
for evaluating interstate pipeline projects. 15 U.S.C.
§ 717n(b). As part of that role, FERC performs a technical
environmental analysis pursuant to the National
Environmental Policy Act (“NEPA”). 
Id. NEPA requires
FERC to take a “hard look” at the
environmental impact of the proposed project. Robertson
v. Methow Valley Citizens Council, 
490 U.S. 332
, 350
(1989). If the project involves a “major Federal action”
that would “significantly affect[] the quality of the human
environment,” FERC must prepare a detailed
Environmental Impact Statement. 42 U.S.C. § 4332(C).
Otherwise, FERC need only prepare a concise
Environmental Assessment. 40 C.F.R. §§ 1501.3, 1501.4,
1508.13.
   As a condition of FERC’s approval, the applicant is
required to obtain any additional state or federal licenses
required by law. For example, because the Orion Project
would discharge “dredged or fill material” into the “waters
of the United States,” Tennessee Gas was required to

                            7
obtain a permit under Section 404 of the Clean Water Act.
33 U.S.C. §§ 1344(a), 1362(7).

    The United States Army Corps of Engineers reviews
applications for Section 404 permits. In doing so, the
Corps applies the so-called Section 404 Guidelines (“the
Guidelines”) issued by the Environmental Protection
Agency. See 33 C.F.R. § 320.4. See generally Coeur
Alaska, Inc. v. Se. Alaska Conservation Council, 
557 U.S. 261
(2009). Among other things, the Corps may not issue
a permit where there is a “practicable alternative” with less
adverse impact on the aquatic ecosystem, “so long as the
alternative does not have other significant adverse
environmental consequences.” 40 C.F.R. § 230.10(a).
    In performing its alternatives analysis, the Corps may
rely on the environmental report prepared by FERC
pursuant to NEPA. The agencies memorialized their
cooperative relationship in a 2005 Memorandum of
Understanding, which states that the Corps will “use the
FERC record to the maximum extent practicable and as
allowed by law . . . . [T]he Corps will give deference, to
the maximum extent allowed by law, to the project
purpose, project need, and project alternatives that FERC
determines to be appropriate for the project.” JA 39. 4


   4
    The Memorandum of Understanding between FERC
and the Corps supplements an Interagency Agreement
between FERC and nine other federal agencies pursuant to
                             8
                            C

    1. Tennessee Gas’s application. On October 9, 2015,
Tennessee Gas submitted an application to FERC for
approval of the Orion Project. Its application included an
Environmental Report, which discussed and rejected
compression alternatives. Tennessee Gas explained that
building compressor stations would require Tennessee Gas
“to obtain approximately 40-acres per site (total of 80
acres).” JA 408. Building compressor stations would also
require “permanent vegetation clearing from the area in
order to install permanent access roads, fencing, buildings
and other appurtenance equipment,” and would create
“light pollution and noise impacts and may also become a
source of [greenhouse gas] emissions.” 
Id. But with
the
Orion Project, “the new [right-of-way] will be allowed to
re-vegetate to minimize and mitigate possible
environmental impacts.” 
Id. The report
further concluded
that the “compression alternative would result in higher
Project operating and fuel costs.” 
Id. 2. Public
notice. On December 3, 2015, FERC issued a
Notice of Intent and solicited public comments regarding
the Orion Project. FERC specifically requested comments
on “reasonable alternatives.” JA 560. On June 10, 2016,



Executive Order 13212 (“Actions to Expedite Energy
Related Projects,” May 18, 2001).
                            9
the Corps issued its own public notice of the Section 404
permit application.

    3. FERC’s draft Environmental Assessment. In July
2016, FERC circulated a non-public draft Environmental
Assessment to the Corps for internal comment. The draft
specifically considered and rejected a possible
compression alternative, as conveyed in a detailed chart.
While the draft Environmental Assessment concluded that
compression would be “technically feasible,” its
“economic efficiency” would be “lower” and it would
“require permanent land use conversion” and present a
new source of light, air emissions, and noise. JA 212. The
draft characterized compression’s environmental impact
as “different,” “comparable,” and “possibly lower” than
the Orion Project. But ultimately, the draft concluded that
the aboveground footprint of building a compression
station is “permanent,” whereas “the bulk of the Project
impacts are temporary (such as waterbody crossings) or
adjacent to the existing right-of-way.” 
Id. 4. Final
Environmental Assessment. On August 23,
2016, FERC published its Environmental Assessment for
public comments—requesting that comments “focus on
the potential environmental effects, reasonable
alternatives, and measures to lessen or avoid
environmental impacts.” JA 239. For reasons that are not
clear from the record, the final Environmental Assessment
omitted the draft’s analysis of the compression alternative.
The final assessment did, nonetheless, recommend a
                            10
“finding of no significant impact” because the Orion
Project’s “impacts on waterbodies and wetlands would be
minor and temporary.” JA 340, 274, 278.
    5. Public Comments. Before the publication of the
Environmental Assessment, “[n]one of the environmental
comments received on the Orion Project identified specific
alternatives to the proposed looping segments.” JA 335.
After publication, groups including Riverkeeper
commented on alternatives but never specifically
addressed compression.

   The Corps received no public comments and received
no requests for a public hearing.
    6. FERC Order Issuing a Certificate. On February 2,
2017, FERC published its Order Issuing a Certificate,
approving the Orion Project and issuing a “certificate of
public convenience and necessity.” 15 U.S.C. § 717f(c).
FERC explained that it “evaluated alternatives to the
Orion Project to determine whether they would be
reasonable and environmentally preferable to the proposed
project,” and “affirm[ed] the conclusion in the
[Environmental Assessment] that no reasonable
alternative would result in significantly less environmental
impacts and accomplish the project’s objective.” JA 635.

   The Order also noted that “[w]hile Delaware
Riverkeeper presents general alternatives that would
potentially result in less impact, Tennessee’s application
                            11
and its response to Delaware Riverkeeper’s comments
provide further evidence that the Orion Project could not
be satisfied by relying on other transportation systems or
looping, compression, and route alternatives along
Tennessee’s own system.” JA 635 (emphasis added).
   7. Corps Considers and Issues a Section 404 Permit.
Concurrently with the FERC process, the Corps reviewed
Tennessee Gas’s application for a Section 404 permit. The
Corps issued its permit on the same date as FERC’s order,
February 2, 2017. The Corps incorporated the
Environmental Assessment into its findings—concluding
that the water impacts would be “temporary in nature” and
the project would have a “[n]egligible effect.” JA 432–34.
The Corps further concluded that “there are no reasonable
or practicable alternatives” for which there would be no
“significant adverse environmental effects,” and that the
Orion Project complies with the Guidelines. JA 445–46,
438. Construction was authorized to begin on March 15,
2017.
    8. Litigation. Riverkeeper filed this petition on March
10, 2017. Tennessee Gas filed a motion to intervene, which
the Court granted on March 17, 2017. On April 7, 2017,
this Court denied Riverkeeper’s emergency motion for a
stay. On April 26, 2017, this Court granted Riverkeeper’s
motion to expedite the case.



                            12
                              II

   We have jurisdiction to review this petition under the
Natural Gas Act. Where an interstate pipeline project is
proposed for construction, see 15 U.S.C. § 717f, we have
“original and exclusive jurisdiction over any civil action
for the review of an order or action of a Federal agency
(other than [FERC]) . . . acting pursuant to Federal law to
issue . . . any permit, license, concurrence, or approval . . .
required under Federal law,” 15 U.S.C. § 717r(d)(1).

     We review for arbitrary or capricious agency action. 5
U.S.C. § 706(2)(A). Under that standard, an agency must
“examine the relevant data and articulate a satisfactory
explanation for its action including a ‘rational connection
between the facts found and the choice made.’” Motor
Vehicle Mfrs. Ass’n of U.S. v. State Farm Mut. Auto. Ins.
Co., 
463 U.S. 29
, 43 (1983) (quoting Burlington Truck
Lines v. United States, 
371 U.S. 156
, 168 (1962)). “We will
. . . ‘uphold a decision of less than ideal clarity if the
agency’s path may reasonably be discerned.’” 
Id. (quoting Bowman
Transp., Inc. v. Arkansas-Best Freight Sys., Inc.,
419 U.S. 281
, 286 (1974)).

                              III
    Before reaching the merits, we must first address
whether Riverkeeper waived (or forfeited) its claims. We
conclude that it did not. Although Riverkeeper failed to
raise the compression alternative in its comments,
                              13
compression was otherwise brought to the agency’s
attention. Furthermore, Riverkeeper’s failure to raise
arguments before FERC does not waive its objections to a
decision by the Corps.

    Challenges to agency action under NEPA are subject to
a prudential waiver rule. Before bringing their NEPA
challenges in court, parties must “structure their
participation” in the administrative process “so that it . . .
alerts the agency to the [parties’] position and contentions,
in order to allow the agency to give the issue meaningful
consideration.” Dep’t of Transp. v. Pub. Citizen, 
541 U.S. 752
, 764 (2004) (alteration in original) (internal quotation
marks omitted) (quoting Vt. Yankee Nuclear Power Corp.
v. Nat. Resources Def. Council, Inc., 
435 U.S. 519
, 553
(1978)). Under that standard, a challenger who claims that
an agency failed to consider an environmentally preferable
alternative must generally raise that alternative in its
comments. 
Id. at 764–65.
   Courts have recognized two exceptions to the
prudential waiver rule. “First, commenters need not point
out an environmental assessment’s flaw if it is ‘obvious.’
Second, a commenter does not waive an issue if it is
otherwise brought to the agency’s attention.” Sierra Club,




                             14
Inc. v. Bostick, 
787 F.3d 1043
, 1048 (10th Cir. 2015)
(citation omitted) (quoting Pub. 
Citizen, 541 U.S. at 765
).5

   In this case, Riverkeeper actively participated in the
administrative process but never raised what has now
become its central argument—that compression is a
legally mandated alternative. According to the Corps and
Tennessee Gas, Riverkeeper was required to raise that
objection before FERC. We need not address whether the
prudential waiver rule applies in this case where
Riverkeeper brought challenges under the Clean Water Act
only, not NEPA. And even if the rule did apply,
Riverkeeper has not waived its claims for two reasons.

    First, the compression alternative was “otherwise
brought to the agency’s attention.” 
Bostick, 787 F.3d at 1048
. Tennessee Gas addressed the compression
alternative in its initial application to FERC and in its
follow-on application to the Corps. And as described
below, the Corps considered and rejected the compression
alternative. It did so for substantially the same reasons set
forth in Tennessee Gas’s application. The compression

   5
     The Ninth Circuit treats these two exceptions as one.
See Barnes v. U.S. Dep’t of Transp., 
655 F.3d 1124
, 1132
(9th Cir. 2011) (“This court has interpreted the ‘so
obvious’ standard as requiring that the agency have
independent knowledge of the issues that concern
petitioners.”). But whether there is one exception or two,
in either case, an exception applies here.
                             15
alternative is thus fair game for litigation and cannot come
as a surprise to the Corps.

    The Corps objects that “the general idea” of
compression may have been before it, but not
Riverkeeper’s “particular alternative.” Resp. Br. 21. But
the crux of Riverkeeper’s argument—that compression
would have a smaller environmental impact—does not
rely on any specific implementation of the compression
alternative that was never presented to the agency. 6 See
Beverly Hills Unified Sch. Dist. v. Fed. Transit Admin., No.
12-cv-9861, 
2016 WL 4650428
, at *76 (C.D. Cal. Feb. 1,
2016). Riverkeeper’s basic argument was considered (and
responded to) in Tennessee Gas’s application, JA 408, and
was further discussed in FERC’s draft Environmental
Assessment, see JA 212 (characterizing compression’s
environmental impact as “different,” “comparable,” and
“possibly lower”). Because the Corps “had independent
knowledge of the very issue that concerns [petitioner] in
this case, . . . ‘there is no need for a commentator to point
them out specifically in order to preserve its ability to
challenge a proposed action.’” 'Ilio'ulaokalani Coal. v.



   6
      Riverkeeper does dispute Tennessee Gas’s position
that two compressor stations would be needed to fulfill the
project’s purpose. According to Riverkeeper, only one
new station would be required. But as explained below,
that dispute is not ultimately material to our conclusion.
                             16
Rumsfeld, 
464 F.3d 1083
, 1093 (9th Cir. 2006) (quoting
Pub. 
Citizen, 541 U.S. at 765
).

   Second, the Corps’ process made it impracticable for
Riverkeeper to lodge its objections with the Corps. The
Corps opened its thirty-day comment period on June 10,
2016, but FERC did not publicly release its Environmental
Assessment until August 23, 2016—after the expiration of
the Corps’ comment period. Any deficiencies with the
Environmental Assessment for purposes of the Clean
Water Act thus could not have been addressed to the Corps
by comment.

    To be sure, Riverkeeper had every opportunity to object
before FERC. It never did, including in its petition for
rehearing filed February 14, 2017, most likely waiving its
right to challenge FERC’s treatment of the compression
alternative in court. See 15 U.S.C. § 717r(b). For that
reason, Tennessee Gas characterizes this action against the
Corps as a “disingenuous[]” collateral attack against
FERC. Intervenor Br. 19.
   Certainly Riverkeeper could have raised its objections
with FERC, and FERC might have communicated those
objections to the Corps. But notwithstanding the agencies’
cooperative relationship, each must fulfill independent
legal responsibilities. In particular, FERC’s analysis under
NEPA is substantively different than the Corps’ analysis
under the Clean Water Act. See Utahns for Better Transp.
v. U.S. Dep’t of Transp., 
305 F.3d 1152
, 1186 (10th Cir.
                            17
2002), as modified on reh’g, 
319 F.3d 1207
(10th Cir.
2003) (noting that, unlike the Clean Water Act, “NEPA
does not require the selection of the least damaging
practicable alternative”). For that reason, an
Environmental Assessment might be sufficient for
purposes of NEPA but not for purposes of the Clean Water
Act. The Guidelines contemplate that possibility and
require the Corps to “supplement [deficient] NEPA
documents with . . . additional information.” 40 C.F.R.
§ 230.10(a)(4). Thus, a party might have a viable objection
before the Corps but not before FERC. At bottom, the
Corps and Tennessee Gas ask us to ignore Riverkeeper’s
arguments because those arguments were not raised before
a different agency administering a different statute. We
decline to do so.

    Even if the prudential waiver rule applies in this case,
we conclude that Riverkeeper did not waive its arguments.
The compression alternative was brought to the Corps’
attention, and Riverkeeper was not required to present its
Corps-specific objections to FERC. We proceed, then, to
the merits.
                            IV

    Riverkeeper argues that the Corps’ decision to issue a
Section 404 permit was arbitrary and capricious for three
reasons: (1) the Corps adopted an irrationally narrow
definition of the project’s “basic purpose”; (2) the Corps
failed to consider the compression alternative; and (3) the
                            18
Corps improperly rejected the compression alternative.
We reject each argument in turn.

                             A

    First, Riverkeeper argues that the Corps adopted an
irrationally narrow definition of the project’s “basic
purpose,” precluding alternatives like compression. We
reject this argument for two reasons. First, Riverkeeper
conflates the separate roles played by a project’s “basic
purpose” and “overall purpose.” Second, any error arising
from the project’s definition is harmless.

   Under the Guidelines, the Corps is required to conduct
an alternatives analysis. But what counts as an alternative?
To determine that, the agency looks to the range of projects
that could achieve the same goal as the proposed project.
“An alternative is practicable if it is available and capable
of being done after taking into consideration cost, existing
technology, and logistics in light of overall project
purposes.” 40 C.F.R. § 230.10(a)(2) (emphasis added).
    Erroneously defining the “overall project purpose” can
be consequential. If it is defined too narrowly, the Corps
might arbitrarily constrict the universe of viable
alternatives. See Jones v. Nat'l Marine Fisheries Serv., 
741 F.3d 989
, 1002 (9th Cir. 2013) (“[T]he Corps may not
manipulate the project purpose so as to exclude alternative
sites . . . .”); Sylvester v. U.S. Army Corps of Eng’rs, 
882 F.2d 407
, 409 (9th Cir. 1989) (“Obviously, an applicant
                             19
cannot define a project in order to preclude the existence
of any alternative sites and thus make what is practicable
appear impracticable.”).
    Separately, the Corps is required to determine whether
a project is “water dependent.” 40 C.F.R. § 230.10(a)(3).
For that, the Corps evaluates whether the project
“require[s] access or proximity to or sit[s] within the
special aquatic site in question to fulfill its basic purpose.”
Id. (emphasis added).
We will return to water dependency
in a later section. For now, it is enough to understand that
the basic purpose (for determining water dependency) is
distinct from the overall purpose (for determining
practicable alternatives).
    In this case, FERC and the Corps 7 adopted the
following definitions:

   • Overall project purpose: “to increase natural gas
     transportation in order to respond to the needs of
     three contracted shippers.”




   7
     Under the regulatory scheme, FERC defines the
project’s basic and overall purposes. Then, pursuant to the
Memorandum of Understanding, “the Corps will give
deference, to the maximum extent allowed by law, to the
project purpose.” JA 39.
                              20
   • Basic project purpose: “to construct natural gas
     pipeline loops.”
JA 430–31. Riverkeeper argues that the Corps adopted too
narrow a definition of the project’s basic purpose. By
limiting the definition to “pipeline loops,” Riverkeeper
argues, the Corps excluded alternatives like compression.
In Riverkeeper’s view, the Corps could reject compression
because it would not constitute an alternative method of
achieving the project’s basic purpose, “construct[ing]
natural gas pipeline loops.” JA 431.
    But as described above, the project’s basic purpose
does not delimit the agency’s alternatives analysis. The
overall purpose does. See All. For Legal Action v. U.S.
Army Corps of Eng’rs, 
314 F. Supp. 2d 534
, 548
(M.D.N.C. 2004) (“Once the Corps determines the water
dependency of a project, it no longer considers the basic
project purpose but analyzes practicable alternatives in
light of overall project purposes.” (internal quotation
marks omitted)). Here, the overall purpose was not
defined in such a way as to exclude the compression
alternative. Compression could very well be an alternative
method of “increase[ing] natural gas transportation,” JA
430, provided it also satisfied the other regulatory
requirements. See Gouger v. U.S. Army Corps of Eng’rs,
779 F. Supp. 2d 588
, 606 (S.D. Tex. 2011) (collecting
cases, and observing that “an ‘overly narrow’ project
purpose is a rare occurrence”).

                           21
    But even assuming, arguendo, that the agency
erroneously defined the project’s basic purpose, such an
error does not categorically compel us to reverse the
agency’s permitting decision. “[T]he Administrative
Procedure Act (APA) directs us to take account of ‘the rule
of prejudicial error.’ In other words, we apply a ‘harmless
error’ analysis to any administrative action we review[.]”
Del. 
Riverkeeper, 833 F.3d at 377
(footnotes omitted). As
described below, the Corps considered the compression
alternative. Furthermore, the Corps did not reject the
compression alternative on the ground that it could not
achieve the project’s basic purpose.

    Both in principle and in practice, the project’s “basic
purpose” did not arbitrarily constrain the Corps’
alternatives analysis. We therefore reject Riverkeeper’s
first argument.
                            B

   Riverkeeper next argues that the Corps failed to
consider the compression alternative. 8 We reject that
argument. Despite being omitted from FERC’s
Environmental Assessment, compression was evaluated in

   8
    Riverkeeper abandoned this argument. See Transcript
of Oral Argument at 13:3–5 (“It did review it. Yes, no
doubt that they did review the compression alternative.”).
We will still briefly address it in the interest of
thoroughness.
                            22
Tennessee Gas’s application and expressly referenced in
the Corps’ findings.

    Tennessee Gas’s application to the Corps included an
alternatives      analysis    that     explicitly discussed
compression. See JA 69. The Corps’ alternatives analysis
cross-references Tennessee Gas’s application and
expressly identifies compression as one of the alternatives
considered. See JA 438 (“[Tennessee Gas] examined
several alternatives . . . including . . . Compression
Alternatives . . . .”). That statement is sufficient to
persuade us that the Corps in fact considered compression
as part of its alternatives analysis.9

   Riverkeeper objects that FERC’s final Environmental
Assessment never mentioned compression. Indeed, the
final document stated that FERC “did not evaluate any
aboveground facility site alternatives.” JA 335. According
to Riverkeeper, FERC’s failure to address compression
becomes the Corps’ failure as well. Even granting that
FERC had abandoned its analysis of compression, the
Corps did not solely review the contents of FERC’s
Environmental Assessment. See JA 445 (“[T]his office has

   9
     Our conclusion is further supported by FERC’s draft
Environmental Assessment, which specifically analyzed
the compression alternative. See JA 210–12. But because
the draft was not made publicly available and was not
referenced in the Corps’ findings, we do not give it
dispositive weight.
                            23
reviewed all the available information contained in the
Environmental Assessment prepared by FERC dated
August 2016, and supporting documents . . . .” (emphasis
added)); 
id. (“Based on
a review of all information
contained in the application file and extensive
coordination with the applicant [Tennessee Gas]
. . . .”(emphasis added)); see also JA 438 (discussing
Tennessee Gas’s alternatives analysis, and concluding that
“the alternatives analysis carried out . . . was commiserate
[sic] with the level of impact”).

    Accordingly, we conclude that the Corps did not
arbitrarily or capriciously ignore the compression
alternative.
                             C
   We next consider whether the Corps rejected the
compression alternative for rational reasons in accordance
with the applicable law. We conclude that it did.

    According to Riverkeeper, the Corps did not comply
with two regulations when it rejected the compression
alternative. First, Riverkeeper argues that the Corps failed
to make sufficient findings under 40 C.F.R. § 230.10(a).
Second, Riverkeeper argues that the Corps was required to
hold Tennessee Gas to a heightened standard under 40
C.F.R. § 230.10(a)(3) and failed to do so. We address each
argument in turn.

                            24
                              1

    First, Riverkeeper argues that the Corps erroneously
rejected the compression alternative by failing to make
appropriate findings under 40 C.F.R. § 230.10(a). We
reject that argument.
   Under that regulatory provision, “no discharge of
dredged or fill material shall be permitted if there is a [1]
practicable alternative to the proposed discharge [2] which
would have less adverse impact on the aquatic ecosystem,
[3] so long as the alternative does not have other
significant adverse environmental consequences.” 40
C.F.R. § 230.10(a). Riverkeeper argues that the
compression alternative satisfies all three conditions.
    We agree with Riverkeeper that compression meets the
first two prongs, but the Corps properly concluded that
compression would “have other significant adverse
environmental consequences.” 
Id. a. Practicability.
First, the Corps may reject an
alternative if it is not practicable. 
Id. “An alternative
is
practicable if it is available and capable of being done after
taking into consideration cost, existing technology, and
logistics in light of overall project purposes.” 
Id. § 230.10(a)(2).
   The Corps argues that, based on information in
Tennessee Gas’s application and the draft Environmental

                             25
Assessment, compression would result in “higher Project
operating and fuel costs,” JA 408, and would have lower
“economic efficiency” than the Orion Project, JA 211. The
Corps argues that “this information alone would support a
finding that the compression alternative was not
‘practicable’ under the Guidelines.” Resp. Br. 32.

    First, the fact that an alternative might have some
unquantified higher operating cost does not mean the
alternative is not “available” or “capable of being done.”
40 C.F.R. § 230.10(a)(2). More information would be
required to reach that conclusion. Cf. 
Jones, 741 F.3d at 1002
(finding an alternative impracticable because “no
one would seek financing to build a refining facility if it
were not possible to extract a sufficient quantity of
minerals to make the project profitable”).
    Second, while the Corps’ alternatives analysis
discussed the environmental implications of the Orion
Project relative to the alternatives, it never once mentioned
costs or practicability. See JA 438. We are unable to
“supply a reasoned basis for the agency’s action that the
agency itself has not given.” Motor Vehicle 
Mfrs., 463 U.S. at 43
(quoting SEC v. Chenery Corp., 
332 U.S. 194
, 196
(1947)). To be sure, the Corps’ “Conclusion” section
asserts that “there are no reasonable or practicable
alternatives.” JA 446. But the agency did not articulate any
reasoning in support of that conclusion, let alone any
reasoning applicable to compression. The absence of any
reasoning is especially critical in light of FERC’s draft
                             26
Environmental Assessment, which concluded that
building a new compressor station would be practicable.
See JA 212 (“This alternative meets the purpose and need,
[and] is technically feasible.”).

   Accordingly, we cannot uphold the Corps’ decision on
practicability grounds.

   b. Aquatic impacts. Second, an alternative must “have
less adverse impact on the aquatic ecosystem.” 40 C.F.R.
§ 230.10(a). The Corps wisely does not argue this issue.
As the draft Environmental Assessment concludes, the
compression alternative would “eliminate 30 waterbody
crossings . . . and impacts on wetlands.” JA 212.
   c. Overall environmental impact. That brings us to the
final ground that the Corps may rely upon to reject the
compression alternative. Even though compression may
be “a practicable alternative . . . which would have less
adverse impact on aquatic ecosystems,” the Corps
properly concluded that it would “have other significant
adverse environmental consequences.” 40 C.F.R.
§ 230.10(a). Although the Corps’ analysis is not pellucid,
the Corps determined as a practical matter that the
permanent impacts of compression are sufficiently
“significant.”

    i. The Corps deemed the environmental impact of
compression too “significant” to endorse. In its
alternatives analysis, Tennessee Gas stated that “adding a
                           27
new (greenfield) compressor station would require
Tennessee [Gas] to obtain approximately 40-acres per
site,” and that construction “would require permanent
vegetation clearing from the area in order to install
permanent access roads, fencing, buildings and other
appurtenance equipment . . . resulting in increased impacts
to the environment.” 
Id. Tennessee Gas
also observed that
“a new (greenfield) compressor station would be an
aboveground facility with light pollution and noise
impacts and may also become a source of [greenhouse gas]
emissions.” 
Id. In contrast
to those permanent
environmental impacts, the land affected by the Orion
Project “will be allowed to re-vegetate to minimize and
mitigate possible environmental impacts.” 
Id. In its
alternatives analysis, the Corps favored the Orion
Project for those same reasons:
      [Tennessee       Gas]     examined     several
      alternatives . . . including . . . Compression
      Alternatives . . . . The preferred alternative
      co-locates the new pipe within the existing
      right of way, thereby avoiding clearing of a
      new greenway. The majority of impacts are
      temporary, and will be restored to minimize
      the resultant impact. Permanent conversion
      in impacts are from one wetland type (PFO or
      PSS) to another wetland type (PEM), and do
      not result in wetlands being converted to
      uplands.
                            28
JA 438. The Corps articulated a clear preference for
temporary environmental impacts, in direct contrast to the
permanent impacts of compression cross-referenced in
Tennessee Gas’s report. The Corps’ conclusion, therefore,
amounts to judgment that permanent environmental
impacts—including those from compression—are
“significant” in this context.

   Riverkeeper objects that the Corps never explicitly
found any impact “significant.” But the omission of that
singular word is not fatal. Even if the agency’s decision is
“of less than ideal clarity,” we will uphold it “if the
agency’s path may reasonably be discerned.’” Motor
Vehicle 
Mfrs., 463 U.S. at 43
(quoting 
Bowman, 419 U.S. at 286
). Here, the agency’s path can reasonably be
discerned: the Corps rejected the compression alternative
on the ground that its permanent impacts—including
permanent de-vegetation of forty to eighty acres of
greenfield and light, noise, and greenhouse gas
emissions—would be significant under 40 C.F.R.
§ 230.10(a).
   ii. The Corps’ finding was not arbitrary or capricious.
Riverkeeper further objects that, even if the Corps
implicitly found the permanent environmental impact of
compression “significant,” that finding was clearly
erroneous. Applying our deferential standard of review,
we reject that argument.


                            29
   According to Riverkeeper, the Orion Project would
result in “long-term impact[s] on forested areas (30 to 50
years to reach preconstruction mature tree size and
densities)” on over 47 acres of forested uplands. JA 282.
Additionally, the project would result in “222.6 more acres
of total disturbed land, over a hundred more acres of
impacts to agricultural lands, nearly 6 more acres of
permanently deforested wetlands, 15 more acres of
impacts to water resources, impact on 65 more wetlands
and 31 more streams, and will traverse 2,100 feet of steep
slopes.” Reply Br. 15. By contrast, light, air, and sound
pollution from compression were never quantified,
according to Riverkeeper.

   The Corps concedes that the Orion Project will disturb
more land. But it is well supported in the record, and
Riverkeeper does not dispute, that the land will be restored
and allowed to revegetate. See JA 664 (“[I]f Tennessee
[Gas] complies with the construction and restoration
methods described . . . the impacts on waterbodies and
wetlands would be minor and temporary.”); JA 665 (“The
required mitigation measures are adequately protective
and will be enforced.”). That regrowth may occur over a
long period of time, but the compression alternative’s
impacts would continue indefinitely. And as for the Orion
Project’s permanent effects on wetlands, those were not
concerning to the Corps based on its expert judgment. See
JA 438 (“Permanent conversion in impacts are from one
wetland type (PFO or PSS) to another wetland type
                            30
(PEM), and do not result in wetlands being converted to
uplands.”).

   When evaluating the significance of certain aquatic
impacts, the Corps is instructed to put “special emphasis
on the persistence and permanence of the effects.” 40
C.F.R. § 230.10(c); see also 
id. § 230.1
(“The guiding
principle should be that degradation or destruction of
special sites may represent an irreversible loss of valuable
aquatic resources.”). We conclude that it was not a clear
error of judgment for the Corps to apply similar reasoning
to other kinds of environmental considerations,
particularly when the Orion Project would not result in any
net loss of wetlands or other aquatic resources.
   Riverkeeper further objects that environmental impacts
of compression cannot be “significant” under the
Guidelines because FERC has found similar projects not
significant under NEPA. See Minisink Residents for Envtl.
Pres. & Safety v. F.E.R.C., 
762 F.3d 97
, 104 (D.C. Cir.
2014). That analogy is unpersuasive because the
requirements of NEPA are different and not at issue here.
    By Riverkeeper’s logic, the Corps could only reject an
alternative as having “other significant adverse
environmental consequences,” 40 C.F.R. § 230.10(a), if
the alternative would also constitute a “major Federal
action[] significantly affecting the quality of the human
environment” under NEPA, 42 U.S.C. § 4332(C).
Riverkeeper’s approach finds no support in any regulation
                            31
or case. It conflates two bodies of law with different text,
authorship,10 and purpose.

   For example, finding significance under NEPA triggers
a duty to prepare a full Environmental Impact Statement
rather than a concise Environmental Assessment. See
Lower Alloways Creek Twp. v. Pub. Serv. Elec. & Gas Co.,
687 F.2d 732
, 740 (3d Cir. 1982). If we were to adopt this
definition of significance, the Guidelines would fail to
address situations where an alternative’s impact would be
significant enough to be substantially worse for the
environment than the proposed project, but would not be

   10
        The Guidelines are promulgated by the
Environmental Protection Agency, whereas NEPA’s
implementing regulations are promulgated by the Council
on Environmental Quality. For purposes of NEPA,
“significantly” is defined by regulation. See 40 C.F.R.
§ 1508.27. Riverkeeper does not, and cannot, argue that
the same definition is controlling here. To the contrary, the
Corps acted consistently with the understanding of
significance expounded elsewhere in the Guidelines. See,
e.g., 40 C.F.R. § 230.3(o)(3)(v) (“For an effect to
be significant, it must be more than speculative or
insubstantial.”); 40 C.F.R. § 230.10(c) (“Findings
of significant degradation . . . shall be based upon
appropriate factual determinations, . . . with special
emphasis on the persistence and permanence of the
effects.”).
                             32
significant enough to constitute a “major Federal
action[].” 42 U.S.C. § 4332(C). Nothing in § 230.10(a)
requires the Corps to insist on such an alternative.
   Even under NEPA, determining significance is more art
than science. “By adding the word ‘significantly,’ . . .
Congress apparently was willing to depend primarily upon
the agency’s good faith determination as to what conduct
would be sufficiently serious from an ecological
standpoint to require use of the full-scale procedure.” Pub.
Citizen v. Nat'l Highway Traffic Safety Admin., 
848 F.2d 256
, 266 (D.C. Cir. 1988) (quoting Hanly v. Kleindienst,
471 F.2d 823
, 830 (2d Cir. 1972)). Here, the Corps acted
consistently with that understanding: it made a “good faith
determination” that the permanent environmental
consequences of certain alternatives, including
compression, “would be sufficiently serious from an
ecological standpoint” to prefer the Orion Project. 
Id. Accordingly, the
Corps’ finding that the compression
alternative had other significant adverse impacts on the
environment, precluding its selection, was not arbitrary or
capricious based on the record before us.

                             2
    Riverkeeper’s final argument is that the Corps erred by
failing to conduct a water-dependency analysis and by
failing to hold Tennessee Gas to a heightened standard
applicable to non-water-dependent projects. While the
                            33
Corps did not make an explicit water-dependency finding,
its failure to do so was harmless because the Corps took
an appropriately hard look at the project alternatives.
   As described above, a project is water dependent if it
“require[s] access or proximity to or sit[s] within the
special aquatic site in question to fulfill its basic purpose.”
40 C.F.R. § 230.10(a)(3). “Examples of water dependent
projects include, but are not limited to, dams, marinas,
mooring facilities, and docks. The basic purpose of these
projects is to provide access to the water.” Sierra Club v.
Van Antwerp, 
709 F. Supp. 2d 1254
, 1261 (S.D. Fla. 2009)
(quoting Army Corps of Engineers Standard Operating
Procedures for the Regulatory Program (Oct. 15, 1999)),
aff’d, 362 F. App’x 100 (11th Cir. 2010).
    If the project is not water dependent, “practicable
alternatives that do not involve special aquatic sites are
presumed to be available, unless clearly demonstrated
otherwise.” 40 C.F.R. § 230.10(a)(3). The applicant can
“clearly demonstrate[] otherwise,” 
id., by putting
forward
“detailed, clear and convincing” information showing that
non-aquatic alternatives are unavailable, Utahns for Better
Transp., 305 F.3d at 1186
. “This does not require a specific
level of detail to rebut the presumption, but only record
evidence the agency took a hard look at the proposals and
reached a meaningful conclusion based on the evidence.”
Hillsdale Envtl. Loss Prevention, Inc. v. U.S. Army Corps
of Eng’rs, 
702 F.3d 1156
, 1168 (10th Cir. 2012).

                              34
   Here, Riverkeeper is correct that the Corps did not
make any finding regarding water dependency. But that
was harmless error. Assuming that the Orion Project is not
water dependent, and assuming that Tennessee Gas was
required to overcome a heightened burden, the Corps’
determination was still sufficient. Based on Tennessee
Gas’s environmental report, combined with the Corps’
concern with permanent environmental impacts, we
conclude that the Corps “took a hard look at the proposals
and reached a meaningful conclusion based on the
evidence.” 
Hillsdale, 702 F.3d at 1168
.
    To be sure, the Corps did not conduct a detailed
analysis of the compression alternative. But under the
principle of commensurate review, it was not required to
do so. “Although all requirements in § 230.10 must be
met, the compliance evaluation procedures will vary to
reflect the seriousness of the potential for adverse impacts
on the aquatic ecosystems posed by specific dredged or fill
material discharge activities.” 40 C.F.R. § 230.10; see also
id. § 230.6(a).
The Corps explicitly endorsed Tennessee
Gas’s analysis under that rubric: “Based upon the level of
impact to aquatic resources, it was determined that the
alternatives analysis carried out in order to avoid aquatic
resource impacts was commiserate [sic] with the level of
impact.” JA 438.

   Thus, we conclude that the Corps acted in accordance
with the applicable regulations when it rejected the
compression alternative.
                            35
                            V

    For the foregoing reasons, we will uphold the decision
of the Corps and deny the petition for review.




                           36

Source:  CourtListener

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