Opinion ID: 3030641
Heading Depth: 3
Heading Rank: 1

Heading: Convincing Statement of Reasons

Text: In granting the 1996 permit, the Corps made a finding of no significant impact: Performance of this work, in accordance with the standard conditions of the permit, will not significantly affect the quality of the human environment. Further, [the Corps has] determined that the issuance of this particular permit is a Federal action not having a significant impact on the environment. [The Corps has] thus concluded that the preparation of a formal Environmental Impact Statement is not required. This finding fails to provide any reason, let alone a convincing one, why the Corps refrained from preparing an EIS. The only portion of the 1996 permit that might be considered a statement of reasons—if construed quite liberally—is the Corps’ discussion of the FWS’ concern about the cumulative impact of the pier extension. We conclude, however, that this neither qualifies as a statement of reasons nor convinces us that a comprehensive environmental impact report was unnecessary. [12] The Corps recounted the concerns that the FWS raised, namely increased tanker traffic that would raise the risk of an oil spill, and BP’s response to those concerns in the text of the 1996 permit. The Corps then concluded: The new pier also should reduce the chance of oil spills during bunkering of tankers at dock, as the 2520 OCEAN ADVOCATES v. U.S. ARMY CORPS OF ENG’RS ships will be surrounded with containment booms while moored at the dock. The project will also reduce turnaround time for tankers at anchorage, thus reducing the chance for oil spills while at anchor. The Corps concludes that the proposed facility should result in a reduction in the chances for oil spills. We find this determination unsatisfactory, even if it could be interpreted as a statement of reasons obviating the need for an EIS. First, the Corps never explicitly adopted the claim that the project could result in an increase in tanker traffic, leaving us to guess whether it took a hard look at, or even considered, this obvious potential impact. Second, the Corps notes in its summation of BP’s arguments that the dock “will not lead to an increase in the [BP] refinery capacity, as the refinery is already working at maximum capacity.” This statement cannot possibly qualify as a fully informed and well-reasoned basis for failing to give more careful attention to the potential for increased traffic. BP alleged that its refinery was operating “at capacity,” but the Corps never explicitly adopted or relied on this contention, and OA later disproved this claim when it sought to reopen the permit. A patently inaccurate factual contention can never support an agency’s determination that a project will have “no significant impact” on the environment. Third, the Corp relied wholly on BP’s claims that the project would reduce oil spills because of containment booms and reduced anchoring time to conclude that the dock extension would decrease the potential for an oil spill. This claim alone, without a reasoned evaluation of the potential for increased traffic, which is at least in part due to the Corps’ erroneous conclusion that the refinery was operating at full capacity, does not inspire any confidence that the Corps took the hard look that we require. [13] The permit extension granted in 2000 proves equally deficient. Again, the Corps made a finding of no significant impact: OCEAN ADVOCATES v. U.S. ARMY CORPS OF ENG’RS 2521 [The Corps has] determined that performance of the work, as revised and extended in accordance with the conditions of the permit, will not significantly affect the quality of the human environment. Further, [the Corps has] determined that the revision and extension of this particular permit is a Federal action not having a significant impact on the environment and thus [has] concluded that the preparation of a formal Environmental Impact Statement is not required. Here, too, the Corps failed to provide any reason why an EIS was unnecessary. As before, even a generous reading of the rest of the permitting decision as a statement of reasons supporting the Corps’ decision not to prepare an EIS, fails to convince us that the Corps took the obligatory hard look. In discussing OA’s concern that the project would have adverse cumulative effects on the Cherry Point area, the Corps reasoned: In the original permit review for the [BP] project, the Corps made a determination of no significant impact and determined that an EIS was not necessary. [The Corps has] again reviewed possible cumulative impacts of this project and again determined that an EIS is not necessary to review those cumulative impacts. Before coming to this conclusion, the Corps cited to a Biological Evaluation (BE) that BP had prepared, which found that the dock extension would not increase vessel traffic, and a letter from BP stating that only market forces, and not the additional pier, would increase total vessel traffic. The permitting decision includes absolutely no discussion about the tenability or reasonableness of BP’s self-serving claims that the dock extension would not increase vessel traffic. While the designation of Cherry Point as an aquatic reserve—an action that 2522 OCEAN ADVOCATES v. U.S. ARMY CORPS OF ENG’RS prohibited additional terminals in the area—necessarily reduces the future cumulative impact from all projects in the area, the Corps still failed to demonstrate in the 2000 permit extension that it critically evaluated the potential increase in tanker traffic from the dock extension alone. Common sense suggests that BP may have hoped that its sizable investment in the dock would facilitate its ability to handle a greater number of tankers a day, thereby increasing tanker traffic to the facility. The Corps’ failure to look through BP’s claims that it wanted only to increase its efficiency in handling existing congestion and its consequent failure to consider increased vessel traffic as a likely result of the project is unreasonable and insufficiently explained. Given evidence of increasing tanker traffic throughout the 1990s and BP’s admission that demand for refined product may increase considerably, the Corps at a minimum should have analyzed and evaluated BP’s claims that vessel traffic would not increase. B. Substantial Question as to a “Significant” Impact on the Environment OA has raised a substantial question as to the dock extension’s potential significant impact on the environment. As just discussed, the Corps did not consider the potential for increased tanker traffic when it granted the 1996 permit, other than to mention—erroneously—in its recitation of BP’s contentions that the dock extension would not result in increased tanker traffic because the refinery was operating at maximum capacity. The 2000 permit extension decision did not revisit this omission, instead relying exclusively on BP’s expedient assertion that the project would not increase tanker traffic. [14] Without even considering the factors outlined by the Council on Environmental Quality, OA has raised a substantial question about the intensity of the impact that increased tanker traffic would have on Puget Sound; in fact, the “severity of the impact” would be unquestionably severe. The Corps ignored record evidence that the dock could not handle much OCEAN ADVOCATES v. U.S. ARMY CORPS OF ENG’RS 2523 additional traffic. In its 1992 permit application, BP noted that the use of the pier increased incrementally since the mid1980s and that the pier was operating at seventy-four percent of its capacity, a figure it termed “a very high utilization rate that is considered close to, if not maximum practical utilization.” In addition, a report that BP commissioned from an outside consultant expected “marine traffic, especially tanker traffic” to increase upon project completion. Because the new platform would double the berthing capacity of the dock, this factor also would contribute to an increase in the number of vessels able to and actually accessing the refinery. When added to the other traffic demands on the Cherry Point area, the cumulation of tanker traffic may well have a significant impact on the environment, and OA has raised a substantial question about this effect. Since BP applied for the permit in 1992, its traffic has increased. Between 1995 and 1999, the refinery’s throughput increased by 672,000 gallons per day on average. Tanker traffic accessing the BP refinery cannot continue to increase ad infinitum, especially if the dock was operating at or near capacity in 1992. This record evidence raises a substantial question as to whether the dock extension will result in increased tanker traffic. We agree with the Corps and BP that market forces also would increase tanker traffic to the BP facility. The dock extension, however, also increases the facility’s ability to handle increased tanker traffic. Were the dock extension never constructed, BP could handle some additional tanker traffic caused by increasing market demands. With the dock extension, though, the BP facility can handle even greater increases in traffic, should market forces dictate such increases. Because a “reasonably close causal relationship” exists between the Corps’ issuance of the permit, the environmental effect of increased vessel traffic, and the attendant increased risk of oil spills, the Corps had a duty to explore this relationship further in an EIS. Public Citizen v. Dep’t of Transp., 124 2524 OCEAN ADVOCATES v. U.S. ARMY CORPS OF ENG’RS S.Ct. 2204, 2215 (Jun. 7, 2004) (quoting Metro. Edison Co. v. People Against Nuclear Energy, 460 U.S. 766, 774 (1983)). Increased tanker traffic elevates the risk of oil spills—an undeniable and patently apparent risk of harm to Puget Sound. An oil spill could destroy and disrupt ecosystems and kill or injure critical numbers of threatened and endangered species that live, and thrive, in the Cherry Point Region. The Corps failed to appreciate that the permitted activity would lead to increased tanker traffic, an error about the fundamental nature and severity of the impact that the dock extension would have. The obvious severity of the impact that increased tanker traffic poses is enough to warrant reversal on OA’s NEPA claim. Were we unconvinced, however, some of the Council on Environmental Quality factors also demonstrate the significance of increased tanker traffic on this ecologically sensitive area, particularly cumulative significant impacts and uncertain environmental impacts.
[15] The impact of an action is severe “if it is reasonable to anticipate a cumulatively significant impact on the environment.” 40 C.F.R. § 1508.27(b)(7). Cumulative impact is the impact on the environment which results from the incremental impact of the action when added to other past, present, and reasonably foreseeable future actions regardless of what agency . . . or person undertakes such other actions. Cumulative impacts can result from individually minor but collectively significant actions taking place over a period of time. Kern, 284 F.3d at 1075 (quoting Churchill County v. Norton, 276 F.3d 1060, 1072 (9th Cir. 2001)). Moreover, in considering cumulative impact, an agency must provide “some quantified or detailed information; . . . [g]eneral statements about OCEAN ADVOCATES v. U.S. ARMY CORPS OF ENG’RS 2525 possible effects and some risk do not constitute a hard look absent a justification regarding why more definitive information could not be provided.” Neighbors of Cuddy Mountain, 137 F.3d at 1379-80 (internal quotation marks omitted). This cumulative analysis “must be more than perfunctory; it must provide ‘a useful analysis of the cumulative impacts of past, present, and future projects.’ ” Kern, 284 F.3d at 1075 (quoting Muckleshoot Indian Tribe v. United States Forest Serv., 177 F.3d 800, 810 (9th Cir. 1999)). If the Corps’ determination of cumulative impact is fully informed and well considered, we should defer to that finding. On the other hand, we “need not forgive a clear error in judgment.” Kern, 284 F.3d at 1075 (internal quotation marks omitted). The question of cumulative impact depends in part on the Cherry Point refinery and two other existing piers in close proximity: an aluminum plant and the Ferndale oil refinery. With these three facilities, not accounting for the dock extension, an average of fifteen large commercial vessels travel in the Strait of Georgia each day. Up to ten small boats also use the Strait daily. At the peak of the fishing season, more than 100 fishing boats also share the same waterways each day. Approximately 600 ships, including large commercial vessels and barges, travel to the Ferndale refinery each year, thirty travel to the aluminum plant, and 200 ships make trips to the BP pier each year. Another terminal, proposed by Gateway Pacific, was to be constructed south of the BP refinery and was expected to increase vessel traffic in the Strait from an average of two large commercial vessel movements per day to three per day. The Corps concluded that the dock extension would not increase the number of crude oil tankers traveling in the Strait of Georgia and that any increase of crude oil tanker traffic would result from market forces, not the dock addition. The Corps based this conclusion on an unsubstantiated letter from BP, claiming that it had many options other than sea travel for transporting crude and refined oil to and from its refinery. 2526 OCEAN ADVOCATES v. U.S. ARMY CORPS OF ENG’RS [16] This finding fails to convince us that the Corps took a “hard look” at the cumulative effects of the project, excludes the requisite quantified or detailed information necessary to support this finding, and neglects to explain why the Corps could not provide better or more specific information. In addition, it was reasonably foreseeable when BP applied for its permit that the dock extension, along with the existing and proposed projects, could lead to cumulatively significant environmental impacts. As mentioned, the Corps did not appreciate the potential effect of increased tanker traffic. The Corps and BP point out that the SLERA found that increased vessel traffic would occur through 2002 regardless of whether the dock extension was built. Because long-term projections were unavailable, the authors of the SLERA “assumed that the pier extension will eventually support an increase in traffic.” Reliance on this report is misplaced because the WSDNR, the author of the SLERA, contacted the Corps to clarify that its report was very narrow in scope, focusing only on the dock extension and not assessing the cumulative effects of multiple projects. Even if the SLERA considered the cumulative impact of other projects in the area, its vague and uncertain analysis of increased tanker traffic cannot qualify as quantified or detailed information. In granting the permit in 1995, the Corps concluded that neither construction nor operation of the proposed project would produce oil pollution because the chance of accidental oil spills already existed before the dock addition. Moreover, the dock would include high-tech spill containment booms, and the more efficient operation of the dock would lessen the chance of oil spills by reducing the time vessels wait to dock and allowing refueling at the dock. The Corps found that there would be “a decrease in the chances of oil spills while tankers are moored at docks,” but made no finding about the risk of oil spills while tankers traveled to those docks. The Corps did not provide any reason for ignoring the potential increase in OCEAN ADVOCATES v. U.S. ARMY CORPS OF ENG’RS 2527 tanker traffic or declining to weigh the risk of oil spills while traveling against the reduced risk of a spill while docked. The Corps failed to consider how an increase in tanker traffic might reduce, or even outweigh, the alleged benefits of the new dock. This comparison would provide crucial information for assessing cumulative impacts accurately. In granting summary judgment for the Corps and BP on OA’s environmental claims, the district court found that NEPA did not require an EIS because the pier extension was intended to alleviate existing tanker traffic, which would increase due to market forces with or without the extension. To reach this decision, the district court erroneously determined that the intent of the dock extension was to deal with existing traffic and analogized to our decisions in Morongo Band of Mission Indians v. FAA, 161 F.3d 569 (9th Cir. 1998), and Seattle Community Council Federation v. FAA, 961 F.2d 829 (9th Cir. 1992), where the purpose of the proposed project was to increase efficiency and safety. Ocean Advocates, 167 F. Supp. 2d at 1212-13. Here, however, neither the Corps nor BP has proven that the purpose of the pier extension is primarily to increase efficiency and safety. Instead, the 1996 permit states that the “Need and Purpose” of the project is to “expand a petroleum product loading/ unloading facility.” Neither the 2000 amended permitting decision nor BP’s form application for a permit indicates that the central purpose of the project is to increase safety or efficiency. Morongo and Seattle Community Council Federation are also distinguishable because neither case dealt with any change in ground capacity. In both cases, the increased flight volume was a function of new routes into the same airport terminal, whereas in this case whatever increase in tanker traffic may occur results from the expansion of the pier itself. Finally, our cases applying a “growth-inducing” analysis to highway construction projects do not require a different result. In City-of-Carmel-By-The-Sea v. U.S. Department of Transportation, 123 F.3d 1142 (9th Cir. 1997), we held that 2528 OCEAN ADVOCATES v. U.S. ARMY CORPS OF ENG’RS a proposal to build a new bridge, two new interchanges, and to widen an intersecting road was necessitated by existing development and did not require further analysis in the EIS because whatever growth may occur was already accounted for and analyzed by local officials planning documents. Id. at 1162-63. Here, by contrast, even if we found that the pier expansion was necessitated by existing development, the foreseeable growth in tanker traffic has not been accounted for in any other planning documents. [17] The Corps’ findings about cumulative impacts were perfunctory and conclusory and do not provide a helpful analysis of past, present, and future projects. See Kern, 284 F.3d at 1075. OA has raised a substantial question as to whether the pier addition would result in cumulatively significant negative environmental impacts, and the Corps clearly erred in not providing responsive quantified or detailed information.
Where the environmental effects of a proposed action are highly uncertain or involve unique or unknown risks, an agency must prepare an EIS. 40 C.F.R. § 1508.27(b)(5); Nat’l Parks, 241 F.3d at 731-32. “Preparation of an EIS is mandated where uncertainty may be resolved by further collection of data or where the collection of such data may prevent ‘speculation on potential . . . effects. The purpose of an EIS is to obviate the need for speculation . . . .’ ” Nat’l Parks, 241 F.3d at 732 (quoting Sierra Club v. United States Forest Serv., 843 F.2d 1190, 1195 (9th Cir. 1998)) (citation omitted) (alteration in original). The amount that tanker traffic might increase in relation to the dock extension was largely unknown. Presumably, data collection or projection analysis could have determined the likely increase in tanker traffic, considering market forces, the dock extension, and the cumulative impact of the existing and pending facilities in the area. No such analysis is evident in OCEAN ADVOCATES v. U.S. ARMY CORPS OF ENG’RS 2529 the EA, nor is there a “ ‘justification regarding why more definitive information could not be provided.’ ” Blue Mountains, 161 F.3d at 1213 (quoting Neighbors of Cuddy Mountain, 137 F.3d at 1380). The Corps’ “lack of knowledge does not excuse the preparation of an EIS; rather it requires [the Corps] to do the necessary work to obtain it.” Nat’l Parks, 241 F.3d at 733. Concluding that a general risk, but not one attendant to the pier, exists, does not qualify as a hard look that would allow the Corps to skirt preparing an EIS. Our recent decision in Public Citizen supports this holding. 316 F.3d at 1024-26. That case involved various Department of Transportation (DOT) regulations that would allow Mexican trucks to operate in the United States pursuant to NAFTA. Id. at 1009. We held that while all the parties had reason to believe that increased traffic would occur, the EA did not explore the reasons for the additional traffic, for example, whether the proposed agency action or a different cause would prompt an increase in traffic. Id. at 1025. DOT argued that any increases in traffic would depend on international trade agreements, not on the regulations, just as BP and the Corps maintain that increased tanker traffic depends only on market forces and not the additional pier. Id. DOT also argued that the proposed regulation likely would decrease air pollution, while BP and the Corps insist that the pier extension will reduce the risk of oil spills. Id. We rejected both arguments. [18] The Corps’ position was based entirely on BP’s unsupported assertions, and the record reflects no convincing reason for the Corps’ decision. The Corps should have realized that uncertainty surrounded the potential for increased traffic based on the undetermined additional berthing capacity at the BP refinery, the magnitude of this change and its relationship to the increased risk of oil spills, and unknown, long-term projections for increased traffic and the risk of an oil spill. OA has raised a substantial question about these uncertainties, and the Corps acted arbitrarily and capriciously in failing to gather this quantifiable data. 2530 OCEAN ADVOCATES v. U.S. ARMY CORPS OF ENG’RS C. Remedy The fact that BP has completed construction of the dock extension does not alter our conclusion, as we can fashion an appropriate remedy. OA asks us to “order the corps to prepare an EIS that takes a ‘hard look’ at the direct, indirect, and cumulative impacts from any reasonably foreseeable increase in vessel traffic resulting from the facility.” In addition, OA seeks injunctive relief, suggesting that we “direct the district court to issue an injunction freezing any vessel traffic to and from the facility at pre-2000 levels pending completion of the NEPA process.” While NEPA is a procedural statute designed to avoid substantive environmental harms before they take place, and while the new platform is now fully functioning, OA challenges only the operation of the new platform and not its construction. OA conceded at oral argument that it did not seek destruction of the dock extension, but rather, sought a serious inquiry by the Corps into the extent to which the platform’s operation would increase vessel traffic. [19] Although construction of the dock extension is now complete, the Corps may impose conditions on the operation of permitted terminals at any time “to satisfy legal requirements or to otherwise satisfy the public interest.” 33 C.F.R. § 325.4(a); see also id. § 325.6(b). If, for example, the Corps determined on remand that the operation of the dock may result in significant degradation of the environment, the Corps could impose restrictions on the operation of the dock or require other mitigating measures. Thus, requiring an EIS would remedy OA’s harm. We decline to reach a decision on injunctive relief. Instead, we remand to the district court to consider this question in the first instance, including whether OA has made the requisite showing for injunctive relief, what harm BP may suffer under an injunction, and the impact of such an injunction on the public. OCEAN ADVOCATES v. U.S. ARMY CORPS OF ENG’RS 2531