On March 14, 2014, the DC District Court issued its ruling in Public Employees for Environmental Responsibility v. Beaudreau, the litigation challenging the regulatory approval of the proposed Cape Wind Project in the Nantucket Sound.
The proposed Cape Wind Project is the first offshore wind project of its kind in the United States, and one of the largest offshore wind projects in the world. The project has faced fierce opposition from local residents, environmental groups, and Native American tribes since the proposal's inception in 2000. The project was required to obtain numerous regulatory approvals and permits from several Federal agencies under numerous environmental and safety laws, and the regulatory processes required to obtain these approvals and permits presented numerous avenues for project opponents to legally challenge the project.
The Ruling
The court granted summary judgment to Defendant Federal agencies on all counts, with the exception of claims against the Fish and Wildlife Service (FWS) and National Marine Fisheries Service (NMFS) regarding each agency's responsibilities under the Endangered Species Act (ESA). In general, the court granted deference to the various agencies in interpreting statutes under their jurisdiction and applied the "arbitrary and capricious standard" in determining the propriety of their decisions and actions. The court found, among other things:
- Section 414 of the Coast Guard and Maritime Transportation Act, a statute that was passed to address the Cape Wind project specifically, required the Commandant of the Coast Guard to issue terms and conditions for navigational safety, and the Secretary of the Interior to include those terms and conditions in the offshore lease. As long as the terms and conditions were reasonably related to the goal of ensuring navigational safety, were otherwise consistent with the Outer Continental Shelf Lands Act, and were supported by substantial evidence, those terms and conditions must be sustained. The actions of the Coast Guard and the Department of the Interior in implementing this provision met these conditions.
- The FWS failed to make an independent determination concerning reasonable and prudent minimization measures as was required under the ESA in issuing its incidental take statements. The agency had discarded potential operational adjustments because it was determined by Bureau of Ocean Energy Management (BOEM) and Cape Wind that such adjustments were not reasonable and prudent, rather than making its own determination independently as was required under the ESA. This issue was remanded to the agency for further action.
- The NMFS must issue an incidental take permit under the ESA even though the agency determined a take was "unlikely." The determination by the NMFS that "a take is not reasonably certain" is not equivalent to a determination that no incidental take would occur. The issue was remanded to the agency for further action.
- There is no violation of the Migratory Bird Treaty Act (MBTA) prohibition against taking of migratory birds without a permit unless and until a taking occurs without a permit. The MBTA does not extend to agency actions that may only "potentially" or "indirectly" result in the taking of a migratory bird.
- The National Historic Preservation Act (NHPA) is a procedural statute that requires an agency to consider the impact of its action on properties and structures eligible for the National Register of Historic Places, but does not require a specific outcome. The BOEM adequately considered the impact of its actions regarding the offshore lease, and this was not changed by a later determination that Nantucket Sound was in fact eligible for inclusion in the Register.
- The National Environmental Policy Act (NEPA) is also a procedural statute that does not require a specific outcome. The BOEM actions related to NEPA were entitled to deference and its challenged actions were not arbitrary or capricious.
Conclusion
Although the court's decision is important to the future of the Cape Wind project, it also has important lessons for all large-scale infrastructure projects. The Cape Wind project and the challenges its developers faced illustrate the difficulties developers, investors, and proponents of any large-scale infrastructure projects will need to address when multiple agencies, parties, resources, and statutes are involved. These challenges include:
- Efficiently coordinating between many state and federal agencies throughout the entire development and approval process;
- Applying numerous laws in differing contexts and in interaction with one another;
- Predicting the types of decisions agencies make and what aspects of a project require the most attention;
- Dealing with legislative and regulatory actions that may impact the project during the pendency of the approval process;
- Anticipating potential criticisms about, and challenges to, the project and addressing such criticisms and challenges as early in the process as possible; and
- Dealing with court challenges to controversial projects.
Venable attorneys have had significant experience working on projects that involve this type of coordination and collaboration. Many members of our Environmental Law Group have held positions within federal and state agencies that permit or approve major infrastructure projects, or have worked on issues before these agencies or on the Hill on behalf of clients involved with the development of major infrastructure projects. Venable's experience coordinating projects involving multiple resources, agencies, and statutes is an essential asset in the development process and can assist clients dealing with challenges like those faced by Cape Wind's proponents. Venable's lawyers are also fully prepared to defend a project in court, if necessary, and have successfully litigated such cases in federal courts around the country.
Click here for a more thorough discussion of the Court's ruling and its implications for other large-scale development projects.