Source: s3://data.kl3m.ai/documents/govinfo/USCOURTS/USCOURTS-ca8-04-03632/USCOURTS-ca8-04-03632-0/pdf.json

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

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1

 Pursuant to Federal Rule of Appellate Procedure 43(c)(2), Mike Johanns is

automatically substituted for his predecessor, Ann Veneman, as Secretary of the

Department of Agriculture and appellant in this case.

United States Court of Appeals

FOR THE EIGHTH CIRCUIT

___________

Nos. 04-3629/3632 

___________

Friends of the Boundary Waters *

Wilderness; Sierra Club; Superior *

Wilderness Action Network; American *

Lands Alliance, Minnesota Canoe *

Association, American Canoe *

Association, Minnesotans for *

Responsible Recreation, *

*

Plaintiffs/Appellees, * Appeal from the United States

* District Court for the

v. * District of Minnesota.

*

Dale N. Bosworth, Chief of the United *

States Forest Service; Mike Johanns, * 

Secretary of Agriculture,1

 *

*

Defendants/Appellants, *

________________________________ *

*

Conservationists with Common Sense; *

Ely Outfitters Association; Gunflint *

Trail Outfitters Association; Seagull- *

Saganaga Homeowners Association, *

*

Intervenor Defendants/ *

Appellants. *

___________

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Submitted: September 16, 2005

Filed: February 15, 2006

___________

Before BYE, HEANEY, and COLLOTON, Circuit Judges.

___________

BYE, Circuit Judge.

The defendants and intervenor defendants, collectively referred to as the United

States Forest Service (USFS), appeal the district court’s grant of summary judgment

to the plaintiffs, collectively referred to as the Friends of the Boundary Waters

(Friends). Specifically, the USFS appeals the district court’s ruling the USFS did not

have authority to recalculate the average actual annual motorboat use during 1976-78

within certain lake chains of the Boundary Waters Canoe Area Wilderness (BWCAW)

to include uses improperly excluded from its initial base period calculation. The

USFS also appeals the district court’s alternate finding the recalculation was arbitrary

and capricious. We affirm in part and reverse in part.

I

A

The BWCAW was one of the first wilderness areas recognized under the

Wilderness Act of 1964. 16 U.S.C. §§ 1131-36 & note. As the largest wilderness area

east of the Rocky Mountains and north of Everglades National Park, it comprises

approximately 1,080,300 acres of forest land encompassing over 1,175 lakes

connected by several hundred miles of streams and rivers. See Minnesota v. Block,

660 F.2d 1240, 1247 (8th Cir. 1981). It provides habitat for hundreds of species,

including the gray wolf, pine marten, bald eagle, black bear, moose, and lynx.

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2

 The lakes included Fall Lake, Newton Lake, Moose Lake, Newfound Lake,

Sucker Lake, Snowbank Lake, East Bearskin Lake, South Farm Lake, Trout Lake,

Saganaga Lake, and Basswood Lake. See Block, 660 F.2d at 1246 n.9 (citing

BWCAW Act §4(c)). Motorboat use was phased out on other lakes by 1999. See id.

3

 The “average actual annual motorboat use of the calendar years 1976, 1977,

and 1978,” or base period calculation, establishes the maximum number of permits

USFS may issue. The USFS may establish permit quotas lower than the base period

calculation but may not establish quotas allowing more use than during the base

period.

-3-

The Wilderness Act generally prohibits all motorboat use within wilderness

areas protected by the Act. However, the BWCAW was excepted from this general

prohibition insofar as established motorboat use within the BWCAW and other

motorboat use not undermining the ability to maintain the “primitive character of the

area” were permitted. 16 U.S.C. § 1133(d)(5) (1976). In 1978, however, Congress

reconsidered the BWCAW exception to the Wilderness Act. “[I]n reaction to

threatened deterioration of the wilderness from excessive use,” Congress enacted the

Boundary Waters Canoe Area Wilderness Act, Pub. L. No. 95-495, 92 Stat. 1649

(BWCAW Act). See also Block, 660 F.2d at 1246. 

The BWCAW Act prohibited all motorboat use within the BWCAW except on

specifically enumerated lakes comprising approximately one-quarter of its waters.2

The motorboat use allowed by the BWCAW Act is circumscribed: the Secretary of

Agriculture is directed to establish motorboat quotas restricting use to less than or

equal to the “average actual annual motorboat use of the calendar years 1976, 1977,

and 1978.” BWCAW Act § 4(f).3

 The quota levels are “based on such criteria as the

size and configuration of each lake, and the amount of use on that lake.” Id. In

determining the “average actual annual motorboat use,” motorboat use by “lake

homeowners and their guests and resort owners and their guests on that particular

lake” is not counted. Id.

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4

 Only five of these lakes are located at least partially within the BWCAW and

still allow motorboat use: Moose, Newfound, Sucker, Saganaga, and South Farm

Lakes.

-4-

The BWCAW Act was passed to ensure the BWCAW’s wilderness character

would be preserved. See Block, 660 F.2d at 1250 (“Congress passed the BWCAW

Act with the clear intent of insuring that the area would remain as a wilderness and

could be enjoyed as such.”). Limiting motorboat use is integral to preserving the

wilderness values and primitive character of the area. See United States v. Gotchnik,

57 F. Supp. 2d 798, 804 (D. Minn. 1999), aff’d, 222 F.3d 506 (8th Cir. 2000). 

B

In 1981, the USFS initially calculated the “average actual annual motorboat

use.” In doing so, the USFS considered computer data and analyses, wilderness

permit data, records of motorboat use during 1976-78, public comments, and

interviews. For three chains of lakes–the Moose Lake Chain, the Saganaga Lake

Chain, and the Farm Lake Chain–the USFS deemed use by home and resort owners

(as well as their guests) within the lake chain encompassing their property to be

exempt from the base period use calculation. The USFS determined the Moose Lake

Chain encompassed Moose, Sucker, Newfound, and Birch Lakes; the Saganaga Lake

Chain included Saganaga Lake, Seagull River, and Gull Lake; and the Farm Lake

Chain included White Iron, Farm, Garden, and South Farm Lakes.4

 Accordingly, the

USFS concluded motorboat use by homeowners, resort owners, and their guests did

not affect the base period use calculation or quota system and did not require permits

when such use was limited to their lake chain. The USFS calculated the base period

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5

 This includes 837 for Moose Lake Chain, 345 for Farm Lake Chain, and 2,023

for Saganaga Lake Chain. 

6

 This figure is lower than seventy-five percent of the base period use

calculation because it also reflects the reduction in permits resulting from phase outs

of motorboat use on various lakes within the lake chains.

-5-

day use – as opposed to overnight use – as 14,925 day trips for the BWCAW. The

base period use calculated for the three lake chains at issue was 3,205 day trips.5

In 1993, the USFS determined allowing motorboat use to the maximum extent

possible under the statute was “strain[ing] the wilderness environment and [was]

tending to degrade the intended primitive and unconfined recreation experience” of

the BWCAW. It therefore established the Boundary Waters Canoe Area Wilderness

Management Plan and Implementation Schedule of 1993 (1993 BWCA Plan) to set

the motorboat day-use quotas at approximately seventy-five percent of the base period

use calculation. The motorboat day-use permit quota was set at 7,902 permits for the

entire BWACW. The day-use permit quota for the three lake chains was set at 2,376

day-use permits.6

 One day-use permit can accommodate a group of up to four boats

or multiple trips in one day. Admin. R. (A.R.) Exh. 14, at 82.

In 1999, this court concluded the USFS’s interpretation that homeowner, resort,

and guest lake chain use did not require a permit was contrary to the plain language

of the BWCAW Act. Friends of the Boundary Waters Wilderness v. Dombeck, 164

F.3d 1115, 1124-25 (8th Cir. 1999). The court concluded the term “particular lake”

in the BWCAW Act did not mean a lake chain but referred to each individually-named

lake. Id. Accordingly, Dombeck held use by homeowners, resort owners, and their

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7

 For purposes of this opinion, any lake adjoining the property owned by a

homeowner or resort on which use by a homeowner, resort, or guest is considered

exempt under Dombeck shall be referred to as the “particular lake” or “adjoining

lake.” Use on any other lake within a lake chain encompassing such “particular lake”

shall be referred to as “non-exempt lake chain use.”

8

 This is an increase of 5,830, or 3,045 for the Moose Lake Chain; 1,393 for the

Saganaga Lake Chain; and 1,392 for the Farm Lake Chain. 

9

 This constitutes an increase of 4,516, or a 290% increase over the previously

calculated 1993 quota levels for the three lake chains. The resulting quotas are: 2,895

for the Moose Lake Chain; 2,653 for the Saganaga Lake Chain; and 1,344 for the

Farm Lake Chain.

-6-

guests is exempted from a permit requirement only when such use is limited to the

lake adjoining the owners’ properties. Use on any other lake requires a permit.7

Because the USFS did not include homeowner, resort, or guest non-exempt lake

chain use when initially calculating the base period use, the quotas established by the

USFS did not account for non-exempt lake chain use. Given the fixed quotas, the

Dombeck ruling increased demand for permits as homeowners, resorts, and guests

were required to obtain permits for non-exempt lake chain use. In 2002, the USFS

responded to this increased demand by recalculating the base period use and

correlated quotas to include non-exempt lake chain use. The recalculated base period

use figures for the entire BWCAW establish a maximum quota of 15,999 day-use

permits.8

 The USFS applied the 1993 BWCA Plan to establish quotas at seventy-five

percent of the recalculated base period use. Accordingly, pursuant to the 1993 BWCA

Plan, the recalculated total quota for the three lake chains at issue is 6,892 day-use

permits.9

Friends challenged the recalculated base period use figure, arguing the USFS

lacks authority to recalculate the base period use and the recalculation was arbitrary

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and capricious. Friends also challenged USFS’s recalculated quotas as exceeding the

base period use in violation of the BWCAW Act. The district court agreed with

Friends, ruling at summary judgment the USFS was without authority to recalculate

the base period use and the recalculation was arbitrary and capricious. The district

court did not reach Friends’ challenges to the quotas established by the USFS.

II

A

We review de novo a district court’s grant of summary judgment, applying the

same legal standards used by the district court. Voyageurs Nat’l Park Ass’n v.

Norton, 381 F.3d 759, 763 (8th Cir. 2004). Summary judgment is proper when there

is “no genuine issue as to any material fact and the moving party is entitled to

judgment as a matter of law.” Fed. R. Civ. P. 56(c); Employers Mut. Cas. Co. v.

Wendland, 351 F.3d 890, 893 (8th Cir. 2003). “We may affirm the district court’s

grant of summary judgment on any ground supported by the record.” Woods v.

DaimlerChrysler Corp., 409 F.3d 984, 990 (8th Cir. 2005).

We view the evidence and all reasonable inferences drawn therefrom in the

light most favorable to the nonmoving party. In re Derailment Cases, 416 F.3d 787,

792 (8th Cir. 2005). An issue of fact is genuine when a “reasonable jury could return

a verdict for the nonmoving party.” Anderson v. Liberty Lobby, Inc., 477 U.S. 242,

248 (1986). However, “[t]he nonmoving party may not rest on mere allegations or

denials, but must show a genuine issue of material fact (or that the movant is not

entitled to judgment).” Wenzel v. Mo.-Am. Water Co., 404 F.3d 1038, 1039 (8th Cir.

2005) (internal quotation omitted).

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B

Judicial review of federal agency administrative decisions is, unless expressly

stated otherwise, governed by the Administrative Procedures Act (APA). 5 U.S.C.

§ 706; In re Sac & Fox Tribe of Miss. in Ia./Meskwaki Casino Litig., 340 F.3d 749,

755 (8th Cir. 2003). Under the APA, an agency administrative decision may be set

aside only if it is “arbitrary, capricious, and an abuse of discretion, or otherwise not

in accordance with law,” 5 U.S.C. § 706(2)(A), “in excess of statutory . . . authority,”

id. § 706(2)(C), or “without observance of procedure required by law.” Id.

§ 706(2)(D). However, we are “not obliged to stand aside and rubberstamp [the

district court’s] affirmance of administrative decisions that [we] deem inconsistent

with a statutory mandate or that frustrate the congressional policy underlying a

statute.” Nat’l Labor Relations Bd. v. Brown, 380 U.S. 278, 291 (1965).

“When reviewing an agency’s construction of a statute, the court first considers

whether the intent of Congress is clear; if so, the court’s inquiry is over, ‘for the court,

as well as the agency, must give effect to the unambiguously expressed intent of

Congress.’” Dombeck, 164 F.3d at 1121 (quoting Chevron U.S.A. Inc. v. Natural Res.

Def. Council, 467 U.S. 837, 842-43 (1984)); see also Cuadra v. Gonzales, 417 F.3d

947, 950 (8th Cir. 2005).

Where Congress has explicitly or implicitly left a gap in a statute to be filled by

a particular agency, the agency’s interpretations of the statute having the force of law

are entitled to substantial deference under Chevron. United States v. Mead Corp., 533

U.S. 218, 230 (2001). Chevron deference requires courts to give “considerable weight

. . . to an executive department’s construction of a statutory scheme it is entrusted to

administer.” Chevron, 467 U.S. at 844. This considerable weight has been interpreted

by the Eighth Circuit to mean controlling weight unless “arbitrary, capricious, or

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manifestly contrary to the statute.” In re Old Fashioned Enters., Inc., 236 F.3d 422,

425 (8th Cir. 2001). 

Even where an agency is accorded deference, the “agency must provide a

satisfactory explanation for its actions based on relevant data.” Niobrara River Ranch,

L.L.C. v. Huber, 373 F.3d 881, 884 (8th Cir. 2004). This requires an analysis of

whether the decision was “based upon consideration of the relevant factors and

whether there has been a clear error of judgment.” Citizens to Preserve Overton Park,

Inc. v. Volpe, 401 U.S. 402, 416 (1971). If an agency’s decision to which deference

is afforded may be supported on any rational basis, we must uphold it. Voyageurs

Nat’l Park Ass’n, 381 F.3d at 763; Sw. Bell Tel. Co. v. Fed. Comm. Comm’n, 153

F.3d 523, 554 (8th Cir. 1998) (“If an agency . . . does not attempt either to close itself

off from informed opinion or to extend its reach beyond the scope of permissible

authority, then it is our duty to accept that judgment if it is rational and not

unreasonable.”). Therefore, even if the agency’s underlying data are flawed,

substantial deference requires the ruling be reversed only if “‘there is a significant

chance that but for the errors the agency might have reached a different result.’” Cent.

S.D. Co-op. Grazing Dist. v. Sec’y of the United States Dep’t of Ag., 266 F.3d 889,

899 (8th Cir. 2001) (quoting Dombeck, 164 F.3d at 1129).

Because an agency’s choice of methodology is typically borne out of the

agency’s expertise, we defer to an agency’s choice of methodology so long as it is not

arbitrary or without foundation. See Dombeck, 164 F.3d at 1130 (citing Minn. Pub.

Interest Res. Group v. Butz, 541 F.2d 1292, 1302 (8th Cir. 1976)). A decision is

arbitrary or capricious if 

the agency relied on factors which Congress has not intended it to

consider, entirely failed to consider an important aspect of the problem,

offered an explanation for its decision that runs contrary to the evidence

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before the agency, or is so implausible that it could not be ascribed to a

difference in view or the product of agency expertise. 

Motor Vehicle Mfrs. Ass’n v. State Farm Mut. Auto. Ins. Co., 463 U.S. 29, 43 (1983).

III

A

The USFS appeals the district court’s ruling it had no authority to recalculate

the base period use. The USFS argues Dombeck requires the USFS to recalculate the

base period use to ensure Congress’s intent in passing the BWCAW Act is fulfilled.

The USFS interprets the BWCAW Act to give it the authority to correct a major error

in its initial base period calculation made evident by a court ruling. Friends argues

Dombeck does not require the USFS to recalculate the base period use and also argues

that any recalculation of the base period use calculation effectively undermines the

fixed nature of the quota maximum. 

The USFS’s interpretation of Dombeck is not entitled to deference. See Ass’n

of Civilian Technicians v. Fed. Labor Rel. Auth., 353 F.3d 46, 50 (D.C. Cir. 2004);

Donovan v. Anheuser-Busch, Inc., 666 F.2d 315, 326 (8th Cir. 1981). We agree with

Friends Dombeck does not mandate the USFS to recalculate the base period use, since

its holding was limited to requiring a permit for homeowners and resorts when they

engage in non-exempt lake chain use. Dombeck, 164 F.3d at 1124-25. However, our

analysis does not end there. The USFS also interprets the BWCAW Act as

authorizing it to recalculate the base period use. Accordingly, we must analyze this

agency interpretation for reasonableness.

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In determining whether to afford deference to the USFS’s interpretation of the

BWCAW Act, we must first determine whether the congressional intent is clear.

Specifically, we must determine whether Congress intended the USFS to have the

authority to recalculate the statutory cap based upon legal error. See Chevron, 467

U.S. at 842-43.

The BWCAW Act prohibits the use of motorboats within the BWCA except as

specifically authorized by the Act. BWCAW Act § 4(c), 92 Stat. at 1650. The Act

does not directly address whether the USFS has authority to recalculate the “average

actual annual motorboat use of the calendar years 1976, 1977, and 1978 for each

lake.” We have not been directed to any legislative history materials directly

addressing the issue. 

Agencies given the authority to promulgate a quota are presumed to have the

authority to adjust that quota. See United Gas Improvement Co. v. Callery Props.,

Inc., 382 U.S. 223, 229 (1965) (“An agency, like a court, can undo what is wrongfully

done by virtue of its order.”); see also Regions Hosp. v. Shalala, 522 U.S. 448, 457-58

(1998) (concluding an agency decision to recalculate a base amount in a fixed

reimbursement system to prevent the distortion of future reimbursements was

reasonable); Dun & Bradstreet Corp. Found. v. United States Postal Serv., 946 F.2d

189, 193 (2d Cir. 1991) (“It is widely accepted that an agency may, on its own

initiative, reconsider its interim or even its final decisions, regardless of whether the

applicable statute and agency regulations expressly provide for such review.”);.

The BWCAW Act creates a gap which must be filled by the USFS (or, more

precisely, by the Secretary of Agriculture): the determination of the “average actual

motorboat use of the calendar years 1976, 1977, and 1978.” The USFS is given no

significant direction regarding this calculation. See Dombeck, 164 F.3d at 1122.

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Accordingly, the statute is silent on the issue and we must accord the USFS deference

to its interpretation of the statute.

USFS’s interpretation that the BWCAW Act allows it to recalculate the base

period use to correct a major error made manifest by court opinion is reasonable and

not contrary to the purposes of the BWCAW Act. The USFS recalculated the base

period use as a means of addressing the increased permit demand after the Dombeck

ruling. The purpose of the BWCAW Act is to protect the wilderness values of the

BWCAW while maintaining limited motorized access not inconsistent with those

values. See Dombeck, 164 F.3d at 1122-23. Indeed, the purpose of the BWCAW Act

is to establish a maximum level of motorboat use based upon use patterns in 1976-78.

The USFS recalculation, if performed accurately, would not result in a base period use

calculation higher than the “average actual annual motorboat use of the calendar years

1976, 1977, and 1978.” Rather, if performed accurately, it would produce the actual

use figure contemplated by the legislature in passing the BWCAW Act. The USFS

therefore acted reasonably and not contrary to the purposes of the statute when it

recalculated the base period use to include uses previously excluded because of

significant legal error made apparent by a court ruling. As such, the USFS’s

reasonable interpretation must be upheld whether afforded deference under Skidmore

v. Swift & Co., 323 U.S. 134, 139-40 (1944), or Chevron. Accordingly, the judgment

of the district court as to the issue of the USFS’s authority to recalculate the base

period use is reversed.

B

Having determined the USFS has authority to recalculate the base period use

to correct a significant legal error made manifest by court order, we now must

determine whether the USFS recalculated the base period homeowner and resort use

arbitrarily, capriciously, or in a manner contrary to its statutory authority. 

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The USFS claims “the specific means of implementing motorboat use quotas

is left to the discretion of the Secretary.” Appellants’ Reply at 7 (citing Dombeck, 164

F.3d at 1121). The USFS also argues because “[t]he methodology was tailored to the

USFS’s knowledge of, and the best available information regarding, varying patterns

of motorboat use within the three lake-chains, . . . that methodology is entitled to

deference.” Appellants’ Br. at 31.

While the methodology used by an agency is generally entitled to deference,

this is only true where the methodology is not arbitrary, without foundation, or “so

implausible that it could not be ascribed to a difference in view or the product of

agency expertise.” See Dombeck, 164 F.3d at 1130; State Farm Mut. Auto. Ins. Co.,

463 U.S. at 43. It is our view that some of the data relied upon and calculations

performed by the USFS are so unreliable or inadequately explained as to make

reliance on them arbitrary and capricious.

The USFS, in recalculating the base period use, sought to determine the amount

of non-exempt lake chain use. To do this, the USFS first estimated total homeowner

and resort lake chain use. The USFS then estimated what percentage of such use was

non-exempt lake chain use. Because the USFS relied upon different data and

methodologies for each lake chain recalculation, we analyze the USFS’s calculations

with respect to each lake chain separately.

1

We begin by analyzing the recalculated base period use on Moose Lake Chain.

We conclude the USFS recalculated the Moose Lake Chain base period use in an

arbitrary and capricious manner.

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In calculating what percentage of use during the base period was non-exempt

lake chain use, the USFS relied upon deficient homeowner and resort owner surveys.

The USFS acknowledges the surveys were not conducted in a statistically valid

manner. However, it claims the surveys were adequate for the purposes for which

they were used: to supplement other data or to reduce use estimates from other data

sources. Accordingly, we must determine whether the USFS’s reliance upon the

survey results was reasonable. We conclude it was not.

Based upon aerial photographs from 1982, the USFS concluded sixty-two

residences (sixteen of which were resort residences or staff cabins) existed on Moose

Lake during the base period. The survey data relied upon by the USFS was obtained

from a 1999 survey completed by thirteen homeowners on Moose Lake. The USFS

limited its survey to current owners of Moose Lake properties who maintained

ownership since the base period. The survey respondents were aware the survey was

related to the USFS’s recalculation of the base period use. The survey asked two

questions of property owners. The survey asked of 1998 use: “How many days did

you use your stickered motorized watercraft in the BWCAW on Moose, Sucker, and

Newfound [Lakes]?” Of 1978 use, the questionnaire asked: “What percentage of your

motorized watercraft use in the BWCAW was for accessing Basswood, Birch, and/or

Knife [Lakes]?” Only five of the thirteen survey respondents provided answers to the

survey question pertaining to 1978 motorboat use. Those responses varied greatly by

individual. We conclude the survey design and implementation was so inadequate as

to make any reliance upon the data obtained from the survey unreasonable. 

To establish the trustworthiness of a survey, it must be shown: (1) that

a proper “universe” was examined and a representative sample was

chosen; (2) that the persons conducting the survey were experts; (3) that

the data were properly gathered and accurately reported; [and] (4) that

the sample design, the questionnaires, and interviewers, as well as the

respondents, were unaware of the purpose of the survey.

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Lutheran Mut. Life Ins. Co. v. United States, 816 F.2d 376, 378 (8th Cir. 1987).

Although mechanical application of these factors may not be appropriate in every

case, see id., we are of the opinion the uses to which the survey results were put by the

USFS counsel in favor of a more trustworthy survey. 

The design of the survey was flawed for a number of reasons. First, there is no

record evidence the USFS considered various sample populations to determine which

respondents, if any, would provide accurate and representative results. There is no

record evidence the USFS contemplated surveying property owners during the base

period who have since transferred title or conducting other surveys to obtain more

robust survey data. Given the significant variation in the survey responses, we find

it unreasonable for the USFS to rely upon the responses of only five current

homeowners without considering other means, including performing additional

interviews or surveys, to validate the responses. Although the USFS attempts to

justify its reliance by suggesting its approach is similar to statistically valid surveys

involving a small percentage of the total population, this argument lacks merit. There

is a substantial difference between relying upon survey data results from thousands

of responses and relying upon five responses. Indeed, the USFS acknowledges its

survey was not statistically valid. While this does not invalidate the possibility of

using survey data, it cautions the agency to identify the potential weaknesses in the

data and to seek validation of the results obtained through other means or to apply

correction factors to the survey data. See Menorah Med. Ctr. v. Heckler, 768 F.2d

292, 295-96 (8th Cir. 1985) (noting the failure to respond to criticisms that a survey

was untrustworthy makes reliance upon the survey arbitrary and capricious); see also

St. James Hosp. v. Heckler, 760 F.2d 1460, 1467 n.5 (7th Cir. 1985) (“[I]t is an

agency’s duty to establish the statistical validity of the evidence before it prior to

reaching conclusions based upon that evidence.”). 

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Second, neither Basswood nor Knife Lake was considered part of the Moose

Lake Chain in the USFS’s initial base period calculation; the lakes had their own

quotas. Birch Lake is considered part of Moose Lake, but motorized access to Birch

Lake ended in 1984 and the Moose Lake Chain quota was reduced accordingly.

Accordingly, the percentage of motorized use on Basswood, Birch, and Knife lakes

is irrelevant to the recalculation of the base period use on the Moose Lake Chain, as

adjusted for closures to motorized access pursuant to the BWCAW Act. Nevertheless,

based upon answers to the second question, the USFS concluded thirty-one percent

of BWCAW use was located outside the Moose Lake Chain. This conclusion cannot

be reasonably drawn from the survey results because it is dependent upon an incorrect

determination Birch Lake exists outside the Moose Lake Chain. Further, the question

does not consider the possibility use occurred outside the Moose Lake Chain to lakes

other than Basswood, Birch, or Knife. We therefore find the USFS’s conclusion that

thirty-one percent of BWCAW use by Moose Lake Chain resort and home owners was

outside the Moose Lake Chain to be arbitrary and capricious.

Similarly, the USFS’s correlated conclusion sixty-nine percent of BWCAW use

by Moose Lake Chain resort and home owners during the base period was within the

Moose Lake Chain must be re-examined. The conclusion is questionable because,

assuming arguendo the accuracy of the figure, it may not be reasonable to conclude

all use on the Moose Lake Chain was non-exempt lake chain use. The record

evidence clearly establishes some Moose Lake Chain homeowner use was limited to

Moose Lake. A.R. Exh. 61, at 3. The USFS did reduce by thirty-one percent its

estimated actual use figure for the Moose Lake Chain, but that reduction was based

on survey results for use on Bass, Birchwood, and Knife lakes, not based on use of

Moose Lake only. Thus, the USFS’s conclusion all use on the Moose Lake Chain was

non-exempt lake chain use is unsupported by the record.

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10 The USFS argues “[i]t seems unlikely that better results would be obtained

by going back now to the same sources with a different interview form, after years of

litigation and explication of the methodology.” Although the history and prominence

of this litigation within the BWCAW and knowledge of the surveys previously

conducted might affect the reliability of future surveys, this concern neither eliminates

the possibility of estimating base period use through means other than surveys,

additional interviews, or both. Accordingly, such a concern is insufficient to support

the USFS’s reliance upon the flawed survey data.

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Aside from the survey design flaws and the arbitrary conclusions resulting

therefrom, the survey was also performed in a manner to make the results unreliable.

In particular, we find it unreasonable to rely exclusively upon survey results, without

analyzing the potential for bias or adjusting the data based upon any bias found, when

the respondents are aware of the purpose of the survey.10 See Lutheran Mut. Life Ins.

Co., 816 F.2d at 378; Menorah Med. Ctr., 768 F.2d at 295-96; St. James Hosp., 760

F.2d at 1467 n.5. Further, it is unreasonable to rely upon survey responses regarding

behavior twenty years earlier without considering the possibility such responses are

not wholly accurate and either applying correction factors to the responses determined

to be less than wholly accurate or attempting to verify the responses through other

means. We are especially troubled by the USFS’s complete reliance upon the survey

data, without even studying the results for possible inaccuracies, in spite of the fact

only five of the thirteen respondents answered the survey question regarding use

patterns in 1978. 

We agree with the district court that “[o]ne does not need to be a statistician to

apprehend the numerous flaws in this sample.” Friends of the Boundary Waters

Wilderness v. Bosworth, No. Civ. 03-624, 2004 WL 2066848, at *10 (D. Minn. Aug.

26, 2004). Sample size, potential for bias, interviewing techniques, reliability of

extrapolating data, and poor recollection are all relevant factors the agency failed to

properly consider in analyzing the survey results, making the resulting estimates

arbitrary and capricious. We believe these survey deficiencies are so obvious the

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USFS should have considered the potential impact these deficiencies might have on

the trustworthiness of the surveys. Its failure to do so renders reliance upon the survey

results arbitrary and capricious. See Menorah Med. Ctr., 768 F.2d at 295-96. Further,

the survey results did not support the conclusions the USFS drew from them. We

therefore conclude the USFS’s recalculation of non-exempt Moose Lake Chain use

during the base period was arbitrary and capricious. 

2

The USFS non-exempt Saganaga Lake Chain use calculations are also arbitrary

and capricous or otherwise lack foundation. The USFS determined, based primarily

upon Cook County records, there were thirty-four residences on Seagull River and

Gull Lake within the Saganaga Lake Chain in 1976-78. Eight of these residences

were resort residences or resort crew cabins. 

In 1981, the USFS assumed 512 day-use permits were attributable to exempt

use. In its recalculation, the USFS does not use the figure from 1981, but arrives at

a new estimate by relying on USFS records showing an average of fifteen trips per

household per season, multiplying that number by a total of thirty-four homeowners,

and then adding an estimated 883 trips by resort guests. It is unclear whether the

figure 512 applied in 1981 represented use by homeowners only or use by a

combination of homeowners and resort guests. We conclude that before the USFS

may discard the apparent assumption from 1981 that exempt use amounted to 512

day-use permits, it must explain adequately how the 512 figure relates to its current

analysis or why the original figure should be discarded.

Even more troubling is the fact the USFS justifies its recalculation by stating:

“it is unsurprising that the estimated use of Saganaga Lake by the affected parties of

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1,622 is much greater than the number of permits attributed to them because most

exempt users did not get day-use permits.” The USFS points to no record evidence

suggesting the USFS attempted to ascertain what percentage of homeowners or other

exempt users did not obtain day-use permits when traveling either on their particular

lake or when engaged in non-exempt lake chain use. Accordingly, the USFS claim

most “exempt users did not get day-use permits” presently lacks foundation.

The USFS’s recalculated resort non-exempt lake chain use must also be set

aside because it relies upon unreliable and faulty survey data. The USFS validated its

estimate that resort guests and staff used Saganaga Lake six days per week with

interviews of one former resort owner, two current resort owners, and one former

neighbor. Viewing this data in the light most favorable to the USFS, we conclude the

data is insufficiently reliable to justify disregarding, without adequate explanation, its

prior calculation, which was made closer in time to the base period and formed the

basis for the Saganaga Lake Chain quotas for twenty years, that approximately forty

percent of occupied resort sites used Saganaga Lake daily. A.R. Exh. 86, at 25; see

Nat’l Cable & Telecomms. Ass’n v. Brand X Internet Svcs., 125 S. Ct. 2688, 2699

(2005) (holding a reversal of a longstanding agency position requires adequate

justification to avoid being arbitrary and capricious); Good Samaritan Hosp. v.

Shalala, 508 U.S. 402, 417 (1993) (providing considerably less deference to agency

reversals of position than to longstanding agency views). For the reasons stated

above, we conclude the USFS’s recalculation of homeowner and resort non-exempt

Saganaga Lake Chain use was arbitrary and capricious.

3

The USFS’s recalculated base period use for the Farm Lake Chain is similarly

arbitrary and capricious and must be set aside. Although the USFS claims it

“considered use patterns particular to home and resort owners in the different lake

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areas in making its estimates,” the USFS did not adequately explain its extrapolation

of Moose Lake Chain use data to the Farm Lake Chain. Indeed, the record establishes

South Farm Lake was fished approximately one fourth as often as Moose Lake. A.R.

Tab C.

Further, it is unclear from the record whether Farm Lake Chain homeowners

located outside the BWCAW (only South Farm Lake is located within the BWCAW)

were included in the USFS’s initial base period use calculation for the Farm Lake

Chain. That is, we cannot determine from the record whether the USFS, in its initial

calculation, considered Farm Lake Chain homeowners located outside the BWCAW

exempt from the quota system. 

Similarly, the USFS’s recalculation of non-exempt resort Farm Lake Chain use

is arbitrary and capricious. The USFS concluded resorts in the Farm Lake Chain were

not entirely focused on BWCAW use. Accordingly, the USFS interviewed three

resorts and extrapolated the results obtained to the four resorts having exempt permits

in 1998. The three interviewed resorts had capacities of 4 rental units, 12 rental units,

and 13 rental units, and estimated motorboat use per week of 2 days, 7 days, and 39

days, respectively. 

The complete reliance upon such limited survey data to determine resort use on

the Farm Lake Chain, without study to determine the reliability of the results obtained,

is arbitrary and capricious. Given the wide variety of responses, we find it troubling

the USFS did not interview the fourth resort regarding its use of South Farm Lake or

attempt to validate the responses in any way. For the foregoing reasons, we conclude

the USFS’s recalculation of the base period motorboat use within the Farm Lake

Chain was arbitrary and capricious. 

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Because we conclude the USFS recalculated the base period homeowner and

resort motorboat use on the Moose, Saganaga, and Farm Lake Chains in an arbitrary

and capricious manner, we affirm the district court on these issues.

C

Friends also challenges the USFS’s recalculation of the towboat quotas. The

towboat quotas are separate from the homeowner and resort motorboat quotas, though

total motorboat use by homeowners, resorts, their guests, and towboats cannot exceed

the base period use. See Dombeck, 164 F.3d at 1121-22. The USFS has the

responsibility of allocating motorboat use among homeowners, resorts, guests, and

towboats in a manner consistent with the BWCAW Act. Currently, the towboat quota

occupies the space between the maximum homeowner and resort quota and the base

period quota maximum. See A.R. Exh. 47, at 63. That is, towboats are allowed to the

extent their use, when added to the homeowner, resort, and guest use, does not exceed

the base period use. 

The record is not clear as to whether towboats were included in the original

base period use. See A.R. Exh. 53, at 2; A.R. Exh. 81, at 3. The USFS must explain

adequately why it concludes towboat use was exempted or otherwise not counted

during the 1981 calculation of actual use before it undertakes any future recalculation

of towboat use.

D

Although the district court did not reach this issue, both parties agree judicial

economy is best served by our ruling on the USFS’s adjusted motorboat quotas based

upon its recalculated base period use. We agree there is no need to remand this issue

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to the district court for initial determination. Having determined the USFS improperly

recalculated the base period use, we conclude the USFS must recalculate the quotas

consistent with BWCAW Act and the views expressed herein.

IV

We reverse the district court insofar as we conclude the USFS has authority to

recalculate the base period use to correct a significant legal error made manifest by the

Dombeck ruling. We affirm the district court by concluding the USFS’s homeowner

and resort non-exempt lake chain use recalculation for the Moose, Saganaga, and

Farm Lake Chains was arbitrary and capricious. We remand to the district court with

directions to remand to the USFS for a recalculation of the base period use and

motorboat quotas consistent with the BWCAW Act and the opinion. The agency

should do so at the earliest practicable time and include the Friends, Conservationists

with Common Sense, and other affected parties in the rule-making process.

______________________________

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