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4th Cir.: Federal agencies’ pipeline permissions vacated

Authorizations granted by U.S. Interior Department agencies for the Atlantic Coast Pipeline were arbitrary and capricious, failing to provide required explanations for key aspects of the underlying analysis.


The Atlantic Coast Pipeline is a 600-mile pipeline designed to transport natural gas from Harrison County, West Virginia, to eastern Virginia and North Carolina. Constructing the pipeline would generally require a 125-foot right-of-way for most of the distance, disturbing 11,776 acres of land.

In 2017, the Federal Energy Regulatory Commission issued Atlantic Coast Pipeline LLC a certificate of public convenience and necessity to begin construction, conditional on approval from all required state and other federal authorizations for the project. Two such authorizations come from the Fish & Wildlife Service and from the National Park Service.

Following the Commission’s certificate, the Fish & Wildlife Service issued a biological opinion and incidental take statement authorizing the pipeline to “take” several endangered and threatened species. Soon after, the Park Service issued a right-of-way permit authorizing the pipeline to cross the Blue Ridge Parkway. The Petitioners, which are various environmental groups, challenged both agency actions.

Limitations period

The Petitioners filed their challenges within 95 days and 38 days of the agency decisions, respectively. Atlantic Coast contends that, because these challenges were brought pursuant to the Natural Gas Act, which lacks a statute of limitations, this court should adopt the most analogous state-law limitations period; i.e. the 30-day period applicable to petitions for review of state-agency actions in West Virginia, Virginia, and North Carolina.

However, Congress has already established a four-year default period, at 28 U.S.C. § 1658(a), which applies here regardless of whether the Natural Gas Act or the Administrative Procedure Act governs. Accordingly, both challenges are timely.

Fish & Wildlife permit

Pursuant to the Endangered Species Act, the Fish & Wildlife Service issued an incidental take statement authorizing the pipeline to “take” – i.e. kill, harm, or harass – five species designated as threatened or endangered. Such “take” authorizations are intended to act as a trigger that, when reached, results in an unacceptable level of incidental take. Thus, for an incidental take statement to function as a safe harbor, the Fish & Wildlife Service must set a take limit that can be monitored and enforced.

The Petitioners challenge the take limits set by the Fish & Wildlife Service for five species that will be negatively impacted by the pipeline: the Clubshell mussel, the Rusty Patched Bumble Bee, the Madison Cave Isopod, the Indiana Bat, and the Northern Long-Eared Bat. The Fish & Wildlife Service declined to set numeric take limits for these five species, instead using “habitat surrogates” that define take by the amount of adversely affected habitat rather than the number of individuals harassed or killed.

The Fish & Wildlife Service has explained that habitat surrogates are often more practical and meaningful. But although the Fish & Wildlife Service is not required to set a numeric limit, it can only use a habitat surrogate if it demonstrates a causal link between the species and the delineated habitat, shows that setting a numerical limit is not practical, and sets a clear standard for determining when incidental take is exceeded.

The Petitioners argue that the Fish & Wildlife Service did not establish that a numeric take limit was impractical; it did not establish a causal link between the pipeline and the habitat selected for some of the species; and the surrogate limits adopted are unenforceable because they set the vague take limits of a “small percent” or a “majority” of individuals. This court agrees.

The Fish & Wildlife Service claims that some numeric limits were not possible because either it lacked current survey information about many of the species or Atlantic Coast had not completed the necessary surveys. The Fish & Wildlife Service cannot escape its statutory and regulatory obligations by not obtaining accurate scientific information. The agency’s statement that it and Atlantic Coast have not actually done the surveys does not “establish the numerical measure’s impracticality.”

Also contrary to the Fish & Wildlife Service’s contentions, the statute does not require that a consultation must be completed within 90 days. In fact, Congress expressly contemplated that FSW might need more than 90 days and provided for an extended time period if needed. Moreover, the statute does not foreclose the development of additional data to inform consultation. Therefore, lack of time is not a proper basis to conclude that establishing a numerical limit is impractical.

Because the Fish & Wildlife Service failed to create proper habitat surrogates, failed to explain why numeric limits are not practical, and failed to create enforceable take limits for the five identified species, their take limits are arbitrary and capricious. Thus, the incidental take statement must be vacated.

Park Service permit

Standing to sue. By their members, the petitioning environmental groups have met the requirements to challenge the Park Service’s permit authorizing the pipeline to cross the Blue Ridge Parkway. The members variously visit the Three Ridges overlook on a regular basis, enjoy its views, and/or own property near the Parkway. Because the pipeline as planned would prevent the members from enjoying the full beauty of the Parkway and the overlook, they have established injury in fact.

The members’ injuries as alleged are fairly traceable to, or cause by, the Park Service’s right-of-way decision. Authorizing the pipeline to cross the Parkway near the Overlook created the need for the nearby construction and maintenance corridor that would diminish the Parkway’s scenic value. Thus, the Park Service enabled and virtually ensured the alleged harm to the Parkway’s aesthetic value. And granting the requested relief would mitigate, if not eliminate, the alleged harm.

Deference. Only an agency interpretation that carries the force of law is eligible for Chevron deference. This case concerns the scope of authority granted by 16 U.S.C. § 460a-3 and -8 and the effect, if any of the Mineral Leasing Act on those two provisions. In its permit decision, the Park Service interpreted only
§ 460a-8, so no other “interpretation” exists merit deference.

As to § 460a-8, the right-of-way permit lacks virtually all of the procedural hallmarks of a legislative-type determination that might merit deference. The permit has no precedential value and is no more than an agreement between signatories. Further, there is no indication of an adversarial or deliberative process undergirding the decision. Thus, the right-of-way permit cannot be fairly characterized as the exercise of a congressionally delegated legislative function, and Chevron does not apply.

The right-of-way also is not entitled to Skidmore respect. The Park Service’s invocation of § 460a-8 is a one-sentence recitation of statutory text without any accompanying explanation. And because the agency makes no effort to specifically apply the provision to natural gas pipelines or to evaluate contrary arguments, its interpretation wholly lacks explanatory and persuasive power. Accordingly, the court interprets the relevant statutory provisions de novo.

Pipeline rights-of-way. The Mineral Leasing Act creates a separate scheme for regulating pipeline crossings on non-park lands, and it does not diminish the Park Service’s authority to manage the National Park System. Thus, it neither authorizes nor precludes grants of rights-of-way across lands in the park system.

Turning to the scope of authority conferred by the Blue Ridge Parkway Organic Act, the court concludes that
§ 460a-8 applies only to a specific extension of the Parkway that is not at issue here (a never-constructed southern extension to the Parkway).

Parkway purposes. Even if the Park Service could instead grant oil and gas rights-of-way through Parkways property under § 460a-3, it has acted arbitrarily and capriciously by failing to explain why Atlantic Coast’s pipeline is not inconsistent with parkway purposes.

The Parkway’s specific purposes are to connect national parks by way of a national rural parkway passing through scenic landscapes, conserve the scenery and preserve the natural and cultural resources of the Parkway’s designed and natural areas, provide for public enjoyment and understanding of the natural resources and cultural heritage of the central and southern Appalachian Mountains, and provide opportunities for high-quality scenic and recreational experiences along the Parkway and in the corridor through which it passes.

The right-of-way permit in this case would violate the Organic Act if not accompanied by a valid agency determination that the pipeline is not inconsistent with those purposes. Here, the agency decision is not accompanied by any explanation, let alone a satisfactory one. This lack of explanation is particularly troubling given evidence that the pipeline is inconsistent with and in derogation of the Parkway’s purposes. A visual impact study that the Park Service oversaw specifically concluded as much. The permit neither mentions this detrimental effect nor the efficacy of any mitigating steps.

Nor does the Park Service decision address whether the drilling required to install the pipeline will remain consistent with Parkway purposes should the proposed drilling method fail. In the event of failure, Atlantic Coast must resort to its contingency plan of using the “direct pipe” method, which is expected to intensify the disruptive effects of the pipeline and impact additional observation areas. At numerous points, the permit appears to acknowledge the possibility of spills and fires, but it does not consider whether inviting such risks into the National Park System is consistent with the agency’s conservation mission.

Compounding these omissions are elemental errors in what the Park Service does say. In addition to invoking an inapplicable statutory provision as the source of its authority, its permit also cites an inapplicable set of regulations. The regulations codified at 36 C.F.R. Part 14 were promulgated under a statutory scheme for electric utilities, telecommunications lines, and water conduits — not gas pipelines.

The collective weight of these errors and omissions supports a firm conviction that the Park Service has not applied its considered expertise to the exercise of its delegated authority. Accordingly, we hold that its permit decision is arbitrary and capricious.


Because the Fish & Wildlife Service and the Park Service have both granted authorizations in contravention of their respective statutory requirements, the correct remedy is to vacate the incidental take statement and the right-of-way permit, respectively.

While 15 U.S.C. § 717r(d)(3) applies only to an agency action that would prevent the construction of a natural gas facility, here the agency decisions do the opposite by enabling pipeline construction. Thus, § 717r(d)(3) is inapplicable. Accordingly, the Natural Gas Act’s judicial-review provision does not modify the Administrative Procedure Act’s default rule, which empowers this court to “hold unlawful and set aside any agency action.”

Sierra Club v. U.S. Dep’t of the Interior, Case No. 018-1082, Aug. 6, 2018. 4th Cir. (Gregory), from U.S. FWS. Austin Donald Gerken Jr. for Petitioners; Avi Kupfer for Respondents. VLW No. 018-2-168, 62 pp.