Opinion ID: 1318039
Heading Depth: 2
Heading Rank: 3

Heading: Islander East's Efforts to Secure Water Quality Certification

Text: Islander East first applied to the CTDEP for a water quality certification for its pipeline project on February 13, 2002. See Islander East I, 482 F.3d at 87. The following year, on March 13, 2003, Islander East withdrew that application and substituted a new one incorporating modified offshore construction techniques aimed at reducing the project's environmental impacts. See id. (detailing proposed modifications). The CTDEP nevertheless denied certification on February 5, 2004, concluding that the pipeline project was inconsistent with state water quality standards in at least two respects: (1) the various processes associated with pipeline installation would cause temporary water quality disturbance, permanent change to the benthic substrate [ (the sea floor) ], and negative impacts to the aquata biota, inconsistent with the goal of Connecticut Surface Water Quality Standard No. 1 to restore or maintain the chemical, physical, and biological integrity of surface waters, id. at 95 (internal quotation marks and citations omitted); and (2) backfill discharge would permanently degrade waters in the vicinity of the Thimble Islands, rendering the seabed unsuitable for various shellfish and organisms presently inhabiting the area, which result would be inconsistent with Connecticut Surface Water Quality Standard No. 2 and Connecticut's anti-degradation policy, which requires the maintenance and protection of water quality in high quality waters and protection and maintenance of existing uses in all cases, id. at 100 (internal citations omitted). Islander East challenged the CTDEP denial in a state action filed in the Connecticut Superior Court, see Islander East Pipeline Co., LLC v. Envtl. Prot. Comm'r, No. HHD-CV-04-4022253-S (Conn.Super. Ct., filed June 21, 2004), which it subsequently withdrew.
Islander East's withdrawal of its state challenge and its initial petition for review by this court were prompted by Congress's enactment of the Energy Policy Act of 2005, Pub.L. No. 109-58, 119 Stat. 594. Section 313(b) of the Act amended ง 19 of the NGA to afford United States Courts of Appeals original and exclusive jurisdiction over any civil action for the review of an order or action of a Federal agency . . . or State administrative agency acting pursuant to Federal law to issue, condition, or deny any permit, license, concurrence, or approval . . . required under Federal law for the construction of a natural gas facility. 15 U.S.C. ง 717r(d)(1); see also Islander East I, 482 F.3d at 88 (noting that Islander East's petition for judicial review was filed on same day NGA amendment was signed into law). Following argument, this court, by majority decision, rejected the CTDEP's constitutional and retroactivity challenges to Islander East's first petition. See Islander East I, 482 F.3d at 91, 93. Turning to the merits, the court concluded that the CTDEP's denial of certification was, as a whole, arbitrary and capricious. See id. at 104-05. With respect to the CTDEP's conclusion that the project was inconsistent with Surface Water Quality Standard No. 1, the court observed that the CTDEP had failed both to cite record evidence reasonably supporting its finding of permanent harm to natural habitats and benthic substrate, see id. at 98-99 (noting that cited sources did not support conclusion that sedimentation in pipeline area would result in permanent loss of shellfish habitat), and to address contrary evidence on the point, see, e.g., id. at 97 (noting four reports projecting recovery of shellfish habitat). As for the CTDEP's conclusion that the project was inconsistent with Surface Water Quality Standard No. 2, the court faulted the agency for failing to define the area affected, not acknowledging evidence that engineered backfill could improve shellfish habitat, and relying on negative past experiences with construction projects in the Sound without considering subsequent advances in pipeline construction technology. See id. at 100-04. The court's conclusion that the CTDEP's denial of certification was arbitrary and capricious was reinforced by two further facts: the surprising brevity of the agency's analysis relative to the voluminous and complex record, see id. at 105, [7] and documentary evidence suggesting that the agency had pre-determined to oppose the pipeline project under any circumstances, see id. [8] While the court's independent review of the voluminous administrative record identified some evidence potentially supportive of the CTDEP's conclusion, the majority declined to mine the record for evidence not identified by the agency, id. at 100, noting principles of administrative review instructing that a federal court may not supply a rationale for agency action where the agency has provided none or construct support for an agency's conclusion when the agency has not pointed to evidence on the record favoring its decision, id. at 101 (citing Motor Vehicle Mfrs. Ass'n of the U.S., Inc. v. State Farm Mut. Auto. Ins. Co . ( State Farm ), 463 U.S. 29, 42-43, 103 S.Ct. 2856, 77 L.Ed.2d 443 (1983)). [9] Accordingly, being careful to draw no conclusion as to whether the record evidence obligated the CTDEP to grant Islander East's certification application, we remanded the case to the agency with instructions that it conduct the sort of complete and reasoned review required by law. Id. at 105.
Following remand, the CTDEP reexamined the record and, on December 19, 2006, again denied Islander East's application for a water quality certification. See 2006 Denial. We do not here attempt to outline the numerous findings made and conclusions reached in the agency's 82-page decision because we review many of these in the discussion section of this opinion. We note simply that Islander East promptly petitioned for judicial review, arguing that this second denial was also arbitrary and capricious.