California Trout (CalTrout), an environmental group, brought suit challenging the decision of the U.S. Army Corps of Engineers (Corps) to grant a Clean Water Act (CWA) section 404 permit sought by the Stockton East Water District (SEWD) to discharge fill material into 4.18 acres of federally controlled wetland as a result of building a diversion facility at Rock Creek. This activity was a small part of a larger privately funded forty-one-mile-long project to divert water from the StanislausRiver in the Central Valley of California. Since the Corps had determined that its jurisdiction did not extend to the rest of the project, it looked only at the environmental impacts of the fill project, and having determined that the environmental impacts were not significant, decided that an environmental impact statement (EIS) was not required. CalTrout argued that the scope of review should have included the entire project. When the district court granted summary judgment in favor of the Corps and SEWD, CalTrout appealed.
On appeal, CalTrout contended that the Corps violated the National Environmental Policy Act (NEPA) and the CWA by limiting the scope of its permit review only to the discharge project, instead of considering the entire project's environmental effects on fisheries downstream in the StanislausRiver. CalTrout reasoned that because the nonfederal portions of the project were dependent upon the completion of the Rock Creek facility, the entire project constituted a single federal action, and thus the scope of review should have covered the entire project.
The court of appeals held that arbitrary and capricious was the appropriate standard in reviewing the Corps's decision to limit its scope of review to the fill project and not issue an EIS. The court would only overturn the decision of the Corps if the Corps had committed a "clear error of judgment."
First, the court considered whether the Corps had violated NEPA by not extending its scope of review to the entire project. Adopting the reasoning of a case with a similar factual setting,[1] the court held that Corps had properly limited its scope of review to the fill project because another federal agency, the U.S. Bureau of Reclamation (BOR), had the contractual right and statutory obligation to curtail SEWD's contractual allocations of water as necessary to protect the needs of the fisheries. BOR controls New Melones Reservoir, which is the source of the water to be diverted. The Corps, on the other hand, had no jurisdiction over how much water would be diverted for the use of SEWD. Moreover, BOR had already fulfilled NEPA's mandate by preparing an EIS "to the fullest extent required by NEPA." Since BOR had already completed several studies regarding the SEWD project and its effect on the fisheries downstream, the court reasoned it would be nonsensical to require the Corps to duplicate these efforts.
Next, the court considered whether the Corps had, as charged by CalTrout, violated the CWA by failing to consider the views of the U.S. Fish and Wildlife Service, the National Marine Fisheries Service, and state fish and game officials. The court found that the Corps considered, as required, these agencies' initial concerns, addressed them, and explained why it found them unpersuasive. Also, the court found that CalTrout had exaggerated the level of interagency disagreement; the U.S. Fish and Wildlife Service eventually agreed that the Corps should limit its review to the effects of the fill, and neither the Environmental Protection Agency nor the National Marine Fisheries Service administratively challenged the Corps's scope of review.
The court held that CalTrout had failed to show that the Corps's action in issuing the permit to SEWD under the CWA was arbitrary, capricious, an abuse of discretion, or otherwise not in accordance with the law. Therefore, the district court's granting of summary judgment to the Corps and SEWD was affirmed.
