Source: s3://data.kl3m.ai/documents/govinfo/USCOURTS/USCOURTS-caDC-01-05247/USCOURTS-caDC-01-05247-0/pdf.json

Nature of Suit Code: 893
Nature of Suit: Environmental Matters
Cause of Action: 

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United States Court of Appeals

FOR THE DISTRICT OF COLUMBIA CIRCUIT

Argued May 7, 2002 Decided July 2, 2002

No. 01-5247

John E. Gerber, III and

Defenders of Wildlife,

Appellants

v.

Gale A. Norton, Secretary,

Department of the Interior, et al.,

Appellees

Appeal from the United States District Court

for the District of Columbia

(No. 99cv02374)

Eric R. Glitzenstein argued the cause for appellants. With

him on the briefs was Katherine A. Meyer. Jonathan R.

Lovvorn entered an appearance.

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Kathryn E. Kovacs, Attorney, U.S. Department of Justice,

argued the cause for appellees Gale A. Norton, et al. With

her on the brief was M. Alice Thurston, Attorney.

Lawrence R. Liebesman and Rafe Petersen were on the

brief for appellee Winchester Creek Limited Partnership.

Before: Edwards, Henderson, and Garland, Circuit

Judges.

Opinion for the Court filed by Circuit Judge Garland.

Garland, Circuit Judge: This case involves a challenge to a

decision by the Fish and Wildlife Service to issue a permit

authorizing the otherwise unlawful "taking" of the endangered Delmarva fox squirrel in connection with a proposed

residential development. Appellants contend that the Service

violated the Endangered Species Act (ESA) because it did not

allow public comment on a key component of the developer's

permit application, and because it did not make the statutorily required finding that the developer's plan reduced the

impact of the taking to the maximum extent practicable.

Because appellants are correct on both counts, we reverse the

district court's grant of summary judgment against appellants

and order the case remanded for further consideration by the

Service.

I

Section 9 of the ESA makes it unlawful to "take" any

endangered species. 16 U.S.C. s 1538(a)(1)(B). A species is

"endangered" if it "is in danger of extinction throughout all or

a significant portion of its range." Id. s 1532(6). The statute

defines "take" as "to harass, harm, pursue, hunt, shoot,

wound, kill, trap, capture, or collect, or to attempt to engage

in any such conduct." Id. s 1532(19). The Service's regulations further define "harm" to include "significant habitat

modification or degradation where it actually kills or injures

wildlife by significantly impairing essential behavioral patterns, including breeding, feeding or sheltering." 50 C.F.R.

s 17.3.

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Section 10 of the ESA creates an exception to the general

ban on taking. Under that section, the Service may issue a

permit allowing "any taking otherwise prohibited by section

1538(a)(1)(B) of this title if such taking is incidental to, and

not the purpose of, the carrying out of an otherwise lawful

activity." 16 U.S.C. s 1539(a)(1)(B). Several conditions must

be met prior to the grant of an incidental take permit. The

applicant for the permit must submit a conservation plan,

known as a "Habitat Conservation Plan" or "HCP," that

describes:

(i) the impact which will likely result from such taking;

(ii) what steps the applicant will take to minimize and

mitigate such impacts ...; (iii) what alternative actions

to such taking the applicant considered and the reasons

why such alternatives are not being utilized; and (iv)

such other measures that the Secretary may require as

being necessary or appropriate for purposes of the plan.

Id. s 1539(a)(2)(A). The Service must publish notice of the

permit application in the Federal Register, and "[i]nformation

received by the [Service] as part of [the] application shall be

available to the public as a matter of public record at every

stage of the proceeding." Id. s 1539(c). The Service also

must provide an "opportunity for public comment" on the

application and related conservation plan. Id.

s 1539(a)(2)(B). Finally, before issuing the permit the Service must make certain specified findings. These include

findings that the taking will be incidental, that it "will not

appreciably reduce the likelihood of the survival and recovery

of the species in the wild," and, most relevant here, that "the

applicant will, to the maximum extent practicable, minimize

and mitigate the impacts of such taking." Id.

Appellants John E. Gerber, III and Defenders of Wildlife

(hereinafter Defenders) challenge the issuance of an incidental take permit to the Winchester Creek Limited Partnership.1 The permit authorizes the incidental taking of Delmar-

__________

1 Gerber is a wildlife biologist who resides near Winchester's

proposed development. He has "enjoyed seeing fox squirrels [in

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va fox squirrels on a residential community development site

owned by Winchester. The site, known as Home Port, is

located in Queen Anne's County, Maryland, on the Eastern

Shore of the Chesapeake Bay. It is "one of the last natural

habitats" for the Delmarva fox squirrel, which has been listed

as an endangered species since 1967. Gerber v. Babbitt, 146

F. Supp. 2d 1, 3 (D.D.C. 2001); see Final Environmental

Assessment (EA) at 2 (J.A. at 649). According to the Service,

residential developments may harm fox squirrels by fragmenting and degrading their habitat, disrupting their normal

behavior patterns, increasing their risk of being struck by

vehicles, and exposing them to attacks from pets. See Draft

HCP at 23-28 (J.A. at 411-16).

In 1997, Winchester asked the Service whether its development would result in the taking of fox squirrels and whether

it should apply for a permit. The Service responded that, as

long as speed limits and leash laws were enforced in the area

of the project, a taking would probably not occur and hence

no permit was necessary. Defenders promptly filed a lawsuit

alleging that, in determining that Winchester did not need a

permit, the Service had violated the ESA, the National Environmental Policy Act (NEPA), 42 U.S.C. s 4321 et seq., and

the Administrative Procedure Act (APA), 5 U.S.C. s 706.

The Service reconsidered its position and, after conducting an

"in-depth review of the scientific literature," advised Winchester that the Home Port development would likely take fox

squirrels, speed limits and leash laws notwithstanding. Letter from Fish and Wildlife Service (FWS) to Winchester at 1-

2 (May 22, 1998) (J.A. at 289-90). In light of the Service's

shift in position, Defenders agreed to dismiss their lawsuit.

The dismissal was subject to a joint stipulation that the

Service would publish notice of the "availability of a draft

'habitat conservation plan' ('HCP') and application for a[n]

'incidental take permit' ('ITP') for the proposed Homeport on

__________

the area] ... and will continue to enjoy viewing them as long as

they are here." Gerber Aff. p 4 (J.A. at 27). Defenders of Wildlife

is a national conservation organization with members who similarly

"enjoy observing and studying the fox squirrel." Pls.' Second Am.

Compl. p 4 (J.A. at 73).

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Winchester Creek residential development project," and that

it would mail Defenders a "courtesy copy of the draft HCP,

ITP application, and NEPA documentation." Joint Stipulation p 1 (J.A. at 107-08).

On December 31, 1998, the Service issued the required

Federal Register notice announcing the receipt of Winchester's application for a permit. The notice stated that persons

"wishing to review the permit application, HCP, EA, and IA

[Implementing Agreement] may obtain a copy by writing the

Service's Chesapeake Bay Field Office." Notice of Availability and Receipt of Application, 63 Fed. Reg. 72,321, 72,321

(Dec. 31, 1998). It also stated that "[d]ocuments will be

available for public inspection by written request" to that

office. Id. The draft Environmental Assessment explained

that Winchester planned to designate another "31-acre forested parcel in Queen Anne's County ... for an off-site

conservation easement to compensate in part for [the] take of

[fox squirrels] at Home Port." Draft EA at 53 (J.A. at 517).

In accordance with the stipulation entered into as a condition

of dismissing the earlier lawsuit, the Service mailed Defenders copies of Winchester's permit application and accompanying draft HCP. That material, however, did not include a

map of, or otherwise specify the location of, the proposed 31-

acre mitigation site. Nor was that omission limited to the

package sent to Defenders; the map was absent from all

public distributions made by the agency.

Prior to publication of the Federal Register notice, Defenders had submitted a Freedom of Information Act (FOIA)

request to the Service for "[a]ny and all documents that

relate to or in anyway pertain to the Homeport on Winchester Creek development" or "to the conservation of the endangered Delmarva fox squirrel." FOIA Request at 1 (J.A. at

550).2 After the notice was issued and Defenders received

copies of the application and HCP, the Service responded to

Defender's FOIA request. It advised that, while "the public

__________

2 The Service's HCP Handbook states that interested persons

may request permit-related documents under FOIA. See HCP

Handbook at 6-22 to 6-23 (J.A. at 850-51).

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review documents ... were released to you on December 23,

1998," other documents were "subject to withholding." Letter from FWS to Defenders at 1 (Jan. 8, 1999) (J.A. at 552).

Thereafter, Defenders filed extensive comments on Winchester's permit application. They maintained, however, that

they could not evaluate the suitability of the mitigation site as

fox squirrel habitat--and hence could not evaluate the overall

impact of Winchester's application--without knowing the

site's location. See Defenders' Comments at 7 (J.A. at 764).

They requested the location information, as well as a 30-day

extension of the comment period to address that information.

See id. at 7, 12 (J.A. at 764, 769).

The Service issued its final decision regarding the permit

on April 11, 1999, and issued the permit itself on May 13,

1999. In approving the permit, the Service stated that the

losses of live squirrels and habitat caused by the Home Port

development "need to be mitigated," and that the developer

planned to place "31.40 acres of wooded habitat off-site in a

perpetual environmental easement" as a "conservation measure[ ] designed to mitigate" those losses. Findings and

Recommendations at 13 (J.A. at 750). The Service also

acknowledged that there was a "Reduced Impact Alternative"

to Winchester's plan that "would reduce the likelihood of

take" of fox squirrels by relocating the development's access

road "away from the [squirrels'] forested edge habitat." Final EA at 5 (J.A. at 652). It noted, however, that this

alternative had been "rejected by the applicant" because it

would entail additional costs and would delay the process of

obtaining approval from the Queen Anne's County zoning

department. Id. And although the Service conceded that

the location of the mitigation parcel was "not adequately

defined" in the documentation released to Defenders, Response to Comments at 6 (J.A. at 775), and for the first time

attached a map of the mitigation area to the HCP, see Final

HCP, app. C (J.A. at 639-41), the agency denied Defenders'

request for a 30-day extension of the comment period, see

Response to Comments at 10 (J.A. at 779).

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On July 22, 1999, following the Service's announcement of

its approval of the Home Port permit, Defenders sent the

agency a formal notification of their contention that the

Service had violated the ESA by issuing the permit. Defenders again complained that the agency had "precluded the

public from meaningfully commenting" on the permit application by failing to disclose "the location of the area relied on

for off-site mitigation of the project's adverse effects on

Delmarva Fox Squirrels." Letter from Defenders to FWS at

2 (July 22, 1999) (J.A. at 825). They noted some of the

"drawbacks to the site chosen" that they "would have pointed

out" had they known of the location during the comment

period, restated their objection to the rejection of the Reduced Impact Alternative, and requested a reopening of the

comment period. Id. at 3 (J.A. at 826). The Service denied

Defenders' request, replying that it "cannot find a way to

offer meaningful resolution of your allegations at this time."

Letter from FWS to Defenders (Aug. 26, 1999) (J.A. at 841).

On September 7, 1999, Defenders filed suit against the

Service, alleging (inter alia) that the agency had violated the

ESA and the APA by failing to provide the map during the

comment period, and by stating Winchester's view of the

practicability of the Reduced Impact Alternative rather than

making its own findings. On May 15, 2001, the district court

granted summary judgment in favor of the Service. The

court reasoned that, even if the Service had erred by not

making a map of the mitigation area available for public

comment, the error was harmless. The district court also

ruled that the Service had not failed to find that the Reduced

Impact Alternative was impracticable. See Gerber, 146

F. Supp. 2d at 5.3

II

Defenders appeal the district court's decision regarding

both the map and the impracticability finding. We review the

__________

3 Defenders' complaint alleged other violations of the ESA and

NEPA, which the district court dismissed as well. Defenders have

not appealed those rulings.

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issues de novo, as if the agency's decision "had been appealed

to this court directly." Dr. Pepper/Seven-Up Cos. v. FTC,

991 F.2d 859, 862 (D.C. Cir. 1993). We examine those issues

under the provisions of the APA,4 and our task is to determine whether the agency's decision was made "without observance of procedure required by law," 5 U.S.C. s 706(2)(D),

or whether it was "arbitrary, capricious, an abuse of discretion, or otherwise not in accordance with law," id. s 706(2)(A).

III

Defenders' first contention is that the Service violated

section 10 of the ESA, 16 U.S.C. s 1539, by failing to make

the map of the off-site mitigation area available during the

comment period. We agree with Defenders that the Service

did violate section 10, and further agree that the violation was

not harmless.

A

Although the district court suggested that the Service was

not required to make the map available because there is "no

authority for the proposition that [plaintiffs] were entitled to

know every detail of the HCP," 146 F. Supp. 2d at 4, the

Service abandons that argument on appeal. And rightly so.

Section 10(c) expressly provides that "[i]nformation received

by the [Service] as part of any [incidental take permit]

application shall be available to the public as a matter of

public record at every stage of the proceeding." 16 U.S.C.

s 1539(c). While Winchester apparently did not physically

attach the map to the draft HCP it submitted to the Service,

Appellees' Br. at 16 n.5, there is no dispute that Winchester

did submit the map, that the map was "received by" the

Service, and that it was received "as part of" Winchester's

application for an incidental take permit. Indeed, the Service

expressly made the map part of the final HCP that was

__________

4 See Cabinet Mountains Wilderness v. Peterson, 685 F.2d 678,

685 (D.C. Cir. 1982) ("Since the ESA does not specify a standard of

review, judicial review is governed by section 706 of the Administrative Procedure Act.").

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released after the comment period closed. Final HCP, app.

C (J.A. at 639-41). Accordingly, as the Service now concedes,

"[i]n the circumstances presented here, the map of the off-site

mitigation parcel had to be made available to the public,

because it was intended to be part of Winchester's application." Appellees' Br. at 17.

The Service was also required to make the map available

pursuant to section 10(a) of the ESA, which instructs the

agency to provide an "opportunity for public comment, with

respect to a permit application and the related conservation

plan." 16 U.S.C. s 1539(a)(2)(B). That opportunity for comment must be a meaningful opportunity. See American Med.

Ass'n v. Reno, 57 F.3d 1129, 1132-33 (D.C. Cir. 1995); Engine Mfrs. Ass'n v. EPA, 20 F.3d 1177, 1181 (D.C. Cir. 1994);

Connecticut Light & Power Co. v. Nuclear Regulatory

Comm'n, 673 F.2d 525, 530-31 (D.C. Cir. 1982). But as

Defenders quite reasonably complained, they could not meaningfully comment on the mitigation value of the off-site parcel

without knowing its location. See Defenders' Comments at 7

(J.A. at 764) (noting inability to assess the suitability of the

site without knowing, inter alia, whether it was adjacent to

other development areas). And given the Service's conclusion

that the off-site mitigation area was necessary for approval of

the permit,5 there could not have been a meaningful opportunity to comment on the application without a meaningful

opportunity to comment on the site. See Engine Mfrs. Ass'n,

20 F.3d at 1181 ("[T]he Administrative Procedure Act requires the agency to make available to the public, in a form

that allows for meaningful comment, the data the agency used

to develop the proposed rule."). As the agency concedes,

__________

5 See Draft EA at 53 (J.A. at 517) (concluding that the acreage

was "necessary to compensate for the loss of individual [fox squirrels] and reproductive potential" (emphasis added)); Final EA at 26

(J.A. at 702) (stating that the "total mitigation required" included

the "31.40 acre forested parcel" (emphasis added)); Findings and

Recommendations at 13 (J.A. at 750) (stating that the "impacts need

to be mitigated" by measures that include "[p]lacing 31.40 acres of

wooded habitat off-site in a perpetual environmental easement"

(emphasis added)).

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"since the parcel had been identified by Winchester [and]

examined for habitat value by the Service, ... the map

should have been included in the draft HCP." Appellees' Br.

at 17 n.7.

Finally, there is no dispute that disclosure of the map was

also mandated by the stipulation that ended the earlier

lawsuit between the parties. That stipulation required the

Service to mail Defenders a "courtesy copy of the draft HCP,

[permit] application, and NEPA documentation." Joint Stipulation p 1 (J.A. at 108). Since the government concedes that

"the map should have been included in the draft HCP,"

Appellees' Br. at 17 nn.5, 7, the stipulation required the

agency to send the map to Defenders.

Although the Service agrees that it had to make the map

publicly available during the comment period, and that it did

not include a copy with the documents mailed to Defenders

and other requesters, the agency nonetheless insists that it

complied with section 10. It did so, the Service claims, by

having the map available for public inspection at its Chesapeake Bay Field Office. According to the agency, all Defenders had to do was visit the field office; a resident official

would then gladly have produced the map for their personal

inspection.

There is, however, no contemporaneous evidence that the

map was available for inspection at the field office. When

Defenders complained in their comments that the documents

they received did not disclose "the location of the mitigation

site," Defenders' Comments at 7 (J.A. at 764), the Service did

not immediately respond that Defenders should visit the field

office. Instead, the Service "agree[d]" that the "mitigation

site is not adequately defined." Response to Comments at 6

(J.A. at 775). The Service contends that the initial Federal

Register notice announcing the Winchester application "indicated" that the map was available for examination at the

Service's field office. Appellees' Br. at 16. There was,

however, no such indication in the notice. The notice stated

that documents would be mailed to requesters, and that

"[d]ocuments will be available for public inspection" in the

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Chesapeake Bay Field Office. Notice of Availability and

Receipt of Application, 63 Fed. Reg. at 72,321. It did not

suggest that the documents available at the field office would

be different from those available by mail, and certainly not in

such an important respect. Finally, although the Service

submitted a post-complaint affidavit by an Assistant Regional

Endangered Species Coordinator asserting that he would

have provided the map had Defenders "requested the information for the off-site mitigation area in a timely manner,"

Smith Decl. p 6 (J.A. at 34), we will not consider that affidavit.

Upon the Service's motion, the district court issued a protective order denying Defenders' request to conduct "discovery

... to probe the accuracy and veracity of th[at] extra-record

assertion[ ] by defendants' declarant[ ]." Gerber Rule 56(f)

Decl. p 15 (J.A. at 120); see Mem. Order at 1-2 (J.A. at 105-

06); Fed. Defs. Mem. in Supp. of Mot. for Protective Order at

2. It would be extraordinarily unfair to permit the Service to

rely on such a post-complaint factual assertion, and at the

same time allow the agency to deny its opponents the ability

to test the assertion's veracity through discovery.

The District Court suggested that the Service had intentionally refused to make the map public. "[T]he omission of

the map from [plaintiffs'] courtesy copy appears to have been

deliberate," the court said, because "[t]he mitigation site was

apparently the subject of a pending real estate transaction as

to which the Service had provided Winchester Creek some

assurance of confidentiality." Gerber, 146 F. Supp. 2d at 4

n.2. On June 25, 1998, Winchester advised the Service that it

was ready to fax the agency its mitigation plans. "Prior to

doing so," however, Winchester insisted that it "must have

U.S. Fish & Wildlife Service['s] agreement that [the plans]

will not be released under FOIA." Fax from Winchester to

FWS (2:19 p.m., June 25, 1998) (J.A. at 367). The developer

required this agreement, it explained, because it had not yet

purchased the site and "public knowledge of the need could

... result[ ] in higher costs to Winchester." Id. The Service

responded the same day, assuring Winchester that it concurred "that the materials you are offering to send ...

qualif[y] for exemption under the Freedom of Information

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Act." Letter from FWS to Winchester (June 25, 1998) (J.A.

at 369). Winchester promptly faxed the plans, noting the

agreement that "the location of the proposed site is to be

confidential." Fax from Winchester to FWS (4:06 p.m., June

25, 1998) (J.A. at 362).

We need not determine whether the Service's failure to

disclose the map was in fact deliberate in order to decide the

validity of Defenders' challenge. Whether or not the agency

intentionally kept the map from the public, and whether or

not it would have provided the map had Defenders made the

trip to the field office, we conclude that the map was not

publicly available within the meaning of section 10(c) of the

ESA.6 There is no dispute that, per the stipulation, the

package of documents sent by the Service to Defenders

should have contained the map as part of the permit application and draft HCP. See also HCP Handbook at 6-23 (J.A.

at 851) (stating that the incidental take permit "application

package ... must be provided to all affected interests who

request the package or have a record of significant interest in

the planning program"). Defenders were thus justified in

concluding that, had there been a publicly available map, it

would have been included in the package. Nothing in the

Federal Register served "to disabuse an interested party" of

that reasonable conclusion. MCI Telecomms. Corp. v. FCC,

57 F.3d 1136, 1141 (D.C. Cir. 1995). To the contrary, in

responding to Defenders' FOIA request, the Service advised

Defenders--during the comment period--that while "the public review documents ... were released to you on December

23, 1998," other documents pertaining to the Home Port

development were "subject to withholding under one or more

of the exceptions to FOIA," including the exemption for

__________

6 Cf. MCI Telecomms. Corp. v. FCC, 57 F.3d 1136, 1142 (D.C.

Cir. 1995) ("We need not speculate ... upon the question whether

the Commission intentionally placed its 'notice' in the most obscure

possible place, intriguing though it is; the agency's intent is beside

the point. The question is whether the notice was 'adequate to

afford interested parties a reasonable opportunity to participate in

the rulemaking process.' ").

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"confidential commercial information of the submitter." Letter from FWS to Defenders at 1 (Jan. 8, 1999) (J.A. at 552).

Under these circumstances, Defenders would not reasonably have thought that they could obtain the critically important location map simply by visiting the Service's field office.

Our cases make clear that "an agency may not turn the

provision of notice into a bureaucratic game of hide and

seek." MCI Telecomms. Corp., 57 F.3d at 1142; see Connecticut Light & Power Co., 673 F.2d at 530 ("To allow an agency

to play hunt the peanut with technical information, hiding or

disguising the information that it employs, is to condone a

practice in which the agency treats what should be a genuine

interchange as mere bureaucratic sport."). Whatever the

Service's intention, it plainly misled Defenders and other

interested members of the public into believing that a map of

the mitigation site was not in the public record. It thus

violated the requirement of section 10(c) that it make the

complete permit application "available to the public," as well

as the requirement of section 10(a) that it provide the public

with a meaningful "opportunity to comment" on the application.

B

Having concluded that the Service committed an error, we

next consider whether the error was harmless, as the district

court held. Under the APA, courts must take "due account"

of "the rule of prejudicial error." 5 U.S.C. s 706; see First

Am. Discount Corp. v. CFTC, 222 F.3d 1008, 1015 (D.C. Cir.

2000). To show that error was prejudicial, a plaintiff must

"indicate with 'reasonable specificity' what portions of the

documents it objects to and how it might have responded if

given the opportunity." McLouth Steel Prods. Corp. v.

Thomas, 838 F.2d 1317, 1323-24 (D.C. Cir. 1988) (quoting

Small Refiner Lead Phase-Down Task Force v. EPA, 705

F.2d 506, 540-41 (D.C. Cir. 1983)). Defenders have met that

requirement to an extent we have rarely seen in APA cases,

and have demonstrated as well as any plaintiffs could that

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they suffered prejudice from the agency's failure to provide

an opportunity for public comment.

As we have just held, it is clear that the map of the off-site

mitigation area was indispensable if Defenders were to have a

meaningful opportunity to comment on Winchester's permit

application. When they finally did obtain the map, Defenders

specified at least three serious problems that suggested the

site would not provide adequate mitigation for the taking that

would occur at Home Port. In their pre-complaint letter,

Defenders stated that if they had known of the site's location,

they would have pointed out, inter alia, that "the site is

bordered on the west by a road (Sportsm[an] Neck Road)

that serves approximately 75 homes, ... thus raising questions about the survivability of any [fox squirrels] who do

manage to occupy the site." Letter from Defenders to FWS

at 3 (July 22, 1999) (J.A. at 826). In their post-complaint

filings, Defenders further contended that the site borders

another residential subdivision (Mainbrace) that is currently

under development, a circumstance--like the road--that

would expose the fox squirrels to domestic pets and automobile traffic, thus casting further doubt on the suitability of the

mitigation site as a refuge. They also charged that the

mitigation site was already protected by an open-space covenant, and hence that its designation by Winchester would not

add any new protection for the fox squirrels. See Gerber Aff.

p 15 (J.A. at 30).

Although the district court held that "plaintiffs have not

shown that they would have offered any additional commentary if they had been shown the map," 146 F. Supp. 2d at 4,

the Service does not seriously dispute that Defenders have

satisfied the specification requirement. Instead, the agency

contends that, even without benefit of comments from Defenders, it "knew about the potential for development adjacent to the mitigation" site and was "aware of the location of

Sportsman Neck Road" when it decided to grant the permit.

Appellees' Br. at 23-24. In support of this contention, the

Service principally relies on two documents: a discussion of

the adjacent Mainbrace subdivision submitted by Winchester

and a map of the mitigation site. Id. (citing J.A. at 375-82).

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Neither is sufficient to overcome Defenders' showing of prejudice.

First, we are not at all convinced from these citations that

the Service did "know" of the three problems that Defenders

have identified with respect to the mitigation site. Having

Winchester's view that "significant development" on the

Mainbrace parcel was "unlikely" was hardly the same as

having Defenders' view, as the developer understandably

downplayed the potential for development in the area of the

mitigation site. See Letter from Winchester to FWS at 1

(July 28, 1998) (J.A. at 377). The Winchester submission did

not even mention Sportsman Neck Road, so the most the

Service can say about that problem is that it was "aware of

the location" because it had a map on which the road was

included. Needless to say, however, possessing a map that

shows the physical location of a road is not the same thing as

knowing the problems that the road may pose. Finally, at

oral argument the Service conceded that there was no precomplaint document of any kind that could have drawn the

Service's attention to the third problem identified by Defenders: the fact that an open-space covenant already existed on

the mitigation site, thus drawing into question whether placing a conservation easement on the site added anything to

existing protections for fox squirrels.

Second, "knowing" is not, in any event, the same as actually

considering the problems raised by Defenders. The Service

cannot point to any discussion in the agency's own decisional

documents that addresses any of the three problems plaintiffs

highlighted. The best the agency can muster is a memorandum to the file, dated more than four months after Defenders

filed their complaint, collecting documentation purportedly

showing that the Mainbrace subdivision and Sportsman Neck

Road "were ... considered during the development and

review of the off-site mitigation package." Mem. to File at 1

(Jan. 31, 2000) (J.A. at 890); see also Letter from FWS to

Defenders at 2 (Feb. 4, 2000) (J.A. at 924) (post-complaint

letter asserting that the agency "was aware of the Mainbrace

development" and "considered" impacts from existing roads

during the decisionmaking process). But the only preUSCA Case #01-5247 Document #686701 Filed: 07/02/2002 Page 15 of 20
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complaint documents cited in the memorandum that address

those points were prepared or submitted by the developer,

not by the agency, and so have the same self-interest deficiency noted above.

The Service also contends that any error it may have made

by not providing a meaningful opportunity for comment prior

to approval of the permit was rendered harmless by the fact

that, after hearing Defenders' post-decision comments, the

agency "reaffirmed its decision." Appellees' Br. at 22. The

only pre-complaint evidence of such a reaffirmation cited by

the Service is its August 26, 1999 response to Defenders'

formal notification that the Service had violated the ESA.

That document, however, does not respond to or even mention the substantive concerns raised by Defenders; it merely

asserts, without elaboration, that "it is our opinion that we

acted with proper process and within the law." Letter from

FWS to Defenders (Aug. 26, 1999) (J.A. at 841). It is

therefore insufficient to sustain the agency's decision. See

Appalachian Power Co. v. EPA, 249 F.3d 1032, 1059 (D.C.

Cir. 2001) ("This Court is obligated to overturn a rulemaking

as arbitrary and capricious where the [agency] has failed to

respond to specific challenges that are sufficiently central to

its decision." (internal quotation marks omitted)); see also

Baltimore Gas & Elec. Co. v. United States, 817 F.2d 108, 116

(D.C. Cir. 1987).

The Service is therefore left with the argument that its

procedural error was harmless because, after Defenders filed

their complaint and elaborated on their concerns, the agency

nonetheless concluded that it would not have changed its

decision had it known of those concerns at the time it issued

the permit. See Appellees' Br. at 22; Pennington Decl. pp 8-

13 (J.A. at 38-40) (post-complaint declaration of assistant field

office supervisor); Letter from FWS to Defenders at 1-2

(Feb. 4, 2000) (J.A. at 923-24) (post-complaint letter from

field office supervisor). We do not generally give credence to

such post hoc rationalizations, but rather "consider only the

regulatory rationale actually offered by the agency during the

development of the regulation." Grand Canyon Air Tour

Coalition v. FAA, 154 F.3d 455, 469 (D.C. Cir. 1998); see

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Burlington Truck Lines, Inc. v. United States, 371 U.S. 156,

168 (1962). That rule is particularly appropriate in a case like

this, because the alternative is to create a regulatory Catch22: If plaintiffs fail to detail the issues upon which they would

have commented, they lose their challenge for failure to

satisfy the "reasonable specificity" requirement of the harmless error rule; but if plaintiffs do specify what they would

have said, the agency may simply thank them for their

specificity and announce that it has nonetheless reached the

same conclusion. Such an approach would eviscerate the

ESA's notice requirements, and we therefore cannot condone

it. Cf. Sugar Cane Growers Coop. v. Veneman, 289 F.3d 89,

96 (D.C. Cir. 2002). In this case, appellants "have presented

enough to show that on remand they can mount a credible

challenge to the [issuance of the permit] and were thus

prejudiced by the absence of an opportunity to do so before"

the agency issued the permit. Utility Solid Waste Activities

Group v. EPA, 236 F.3d 749, 755 (D.C. Cir. 2001). That is all

that is required to defeat the Service's claim of harmless

error.7

We conclude that the Service violated the ESA by failing to

inform Defenders of the location of the mitigation site, and

that the violation was not harmless. At the same time, we

__________

7 The principal harmless error cases cited by the Service and

the district court are not to the contrary. In Steel Manufacturers

Ass'n v. EPA, we held that "petitioners' lack of opportunity to

comment on one of the agency's rationales for setting" a zinc

standard was harmless error "because EPA had adequate and

independent grounds" for setting the standard. 27 F.3d 642, 649

(D.C. Cir. 1994) (emphasis added). In Chemical Manufacturers

Ass'n v. EPA, the Fifth Circuit held that EPA's failure to publish

certain data was harmless because, even without that data, the

petitioner "was fully able to make" the challenge that it wanted to

make to an EPA effluent limitation. 870 F.2d 177, 202, clarified,

885 F.2d 252 (5th Cir. 1989). In the instant case, the Service does

not offer a ground independent of the mitigating value of the

designated site that would have justified issuance of the incidental

take permit, and Defenders were not able to challenge the value of

that site without knowing its location.

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cannot fail to note that the Service could easily have avoided

the prolonged litigation that has transpired over this issue.

All it had to do was grant Defenders' reasonable request for a

30-day extension to comment on a map that the agency

concedes should have been included in the draft HCP from

the outset.

IV

Defenders' second contention is that the issuance of the

incidental take permit violated section 10 of the ESA because

the Service failed to find that the developer would minimize

the impacts of the taking "to the maximum extent practicable." 16 U.S.C. s 1539(a)(2)(B). It is plain on the face of the

statute that it is the Service (as delegatee of the Secretary of

the Interior) that must make this finding. See id. (providing

that a permit shall issue "[i]f the Secretary finds," inter alia,

that "the applicant will, to the maximum extent practicable,

minimize and mitigate the impacts of such taking"). Indeed,

the agency's own handbook so states. See HCP Handbook at

7-3 (J.A. at 852) (declaring that, while "[t]he applicant decides

during the HCP development phase what measures to include

in the HCP ..., the Service[ ] ultimately decide[s], at the

conclusion of the permit application processing phase, whether the mitigation program proposed by the applicant has

satisfied this statutory issuance criterion") (emphasis in original). Accordingly, both parties agree that, before issuing the

permit, the Service was obliged to find independently that no

practicable alternative to Winchester's development plan

would minimize the taking of fox squirrels.

We cannot conclude that the Service independently made

such a finding. To the contrary, the Service found, both in its

draft and final Environmental Assessment, that there was a

"Reduced Impact Alternative" that "would reduce the likelihood of take" of fox squirrels: relocating the Home Port

project's access road away from the squirrels' habitat. Draft

EA at 5 (J.A. at 467); Final EA at 5 (J.A. at 652). According

to the Service, this alternative would have reduced the number of animals killed or injured by automobiles, "the leading

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cause of fox squirrel 'takes.' " Gerber, 146 F. Supp. 2d at 3;

see Appellees' Br. at 27. Indeed, the developer itself acknowledged that this alternative "would greatly reduce take

of [fox squirrels] by providing an adequate buffer from the

wood's edge to existing structures." Draft HCP at 56 (J.A. at

444). Accordingly, the Service expressly "requested a modification to the applicant[']s design plan which would provide for

a relocation (or shift) of the right-of-way entrance road ...

away from the ... forested edge habitat." Draft EA at 5

(J.A. at 467); Final EA at 5 (J.A. at 652).

Winchester, however, rejected the requested alternative,

and the Service nonetheless issued the permit. Given the

Service's finding that moving the road would reduce the

taking of squirrels, the agency could not have issued the

permit consistent with section 10(a) without making a finding

that the Reduced Impact Alternative was impracticable. But

there is no evidence in the record that the Service ever made

such a finding. It did repeatedly observe that the developer

had rejected the alternative. See Final EA at 5 (J.A. at 652)

(stating that "[t]his alternative was rejected by the applicant"); Draft EA at 5 (J.A. at 467) (same). And it noted that

Winchester did so out of concern that changing the design

would entail additional costs and delay the process of obtaining approval from the county zoning department. See Final

EA at 5 (J.A. at 652). But the Service was careful to state

that these were the developer's views. Id. Indeed, the

agency's decisional documents do not contain any analysis

whatsoever as to whether implementation of the Reduced

Impact Alternative would actually result in additional costs

and delay, or whether the magnitude of such costs or delay

would render the alternative impracticable. To the contrary,

the Service declared that "no supporting economic analysis

was sought or considered." Response to Comments at 6 (J.A.

at 775).

When a statute requires an agency to make a finding as a

prerequisite to action, it must do so. Merely "[r]eferencing a

requirement is not the same as complying with that requirement." Sugar Cane Growers Coop., 289 F.3d at 97. And

"[s]tating that a factor was considered"--or found--"is not a

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substitute for considering" or finding it. Getty v. Federal

Savings & Loan Ins. Corp., 805 F.2d 1050, 1055 (D.C. Cir.

1986); see id. at 1057 (holding that a "conclusory recitation"

failed to satisfy a statutory requirement that the agency

"consider" a specified factor). Nor may the agency delegate

its responsibility to the regulated party. See State of Idaho

v. ICC, 35 F.3d 585, 596 (D.C. Cir. 1994) (holding that the

ICC failed to meet its responsibilities under NEPA by "deferr[ing] not only to the judgments of other agencies, but also

to that of Union Pacific, the licensee"); Illinois Commerce

Comm'n v. ICC, 848 F.2d 1246, 1259 (D.C. Cir. 1988) (holding

that the agency "may not delegate to parties and intervenors

its own responsibility to independently investigate and assess

the environmental impact of the proposal before it"). Because the Service did not make the independent finding

required by the ESA as a prerequisite to issuance of an

incidental take permit, issuance of the permit violated the

statute.

V

In the course of approving the incidental take permit for

the Home Port development, the Fish and Wildlife Service

violated two requirements of the ESA. It did not make

available for public comment critical information received in

connection with Winchester's permit application. See 16

U.S.C. s 1539(a)(2)(B), (c). And it did not make the statutorily mandated finding that the developer's plan would minimize the negative impact on the endangered Delmarva fox

squirrel to the maximum extent practicable. See id.

s 1539(a)(2)(B)(ii). As a consequence, the Service issued the

permit "without observance of procedure required by law," 5

U.S.C. s 706(2)(D), and acted "otherwise not in accordance

with law," id. s 706(2)(A). We therefore reverse the district

court's grant of summary judgment, and remand to the

district court with instructions to remand to the agency for

further proceedings. See Sugar Cane Growers Coop., 289

F.3d at 98.

So ordered.

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