Opinion
6:20-cv-00345-MK
08-29-2023
MATTHEW JAMES SMITH; PAUL CALLEN; DARREN PARKER; LYNN WARNER; KATHY POWELL; ANN CORKERY; ALLAN D. CLACK; KEVIN CORKERY; and JBC RANCH PROPERTIES, LLC, Plaintiffs, v. TUMALO IRRIGATION DISTRICT; RONALD ALVARADO; and NATURAL RESOURCES CONSERVATION SERVICE, Defendants.
FINDINGS AND RECOMMENDATION
MUSTAFA T. KASUBHAI (HE / HIM) UNITED STATES MAGISTRATE JUDGE
Plaintiffs Matthew Smith, Paul Callen, Darren Parker, Lynn Warner, Kathy Powell, Ann Corkery, Allan Clark, Kevin Corkery, and JBC Ranch Properties, LLC (collectively, “Plaintiffs”) filed this action against the Tumalo Irrigation District, Ronald Alvarado, and the Natural
Resources Conservation Service alleging violations of the National Environmental Policy Act (“NEPA”) and the Watershed Protection and Flood Prevention Act (“Watershed Protection Act”). Before the Court are cross motions for summary judgment filed by Ronald Alvarado and the Natural Resources Conservation Service (“Federal Defendants”) (ECF No. 112) and Plaintiffs (ECF No. 115) on Plaintiffs' federal claims. For the reasons below, the Federal Defendants' motion should be granted. Plaintiff's motion should be denied.
PROCEDURAL BACKGROUND
Plaintiffs are property owners challenging an irrigation project approved by the Federal Defendants and to be implemented by Tumalo Irrigation District (the “District”). Plaintiffs previously alleged state law claims of impermissible expansion of an easement and private nuisance against the District, but the Court dismissed these claims on September 29, 2022 after the District moved for summary judgment. ECF No. 102. At issue in the present motions are Plaintiffs' remaining federal claims of NEPA violations and violations of the Watershed Protection Act.
BACKGROUND
In 2018, the Natural Resources Conservation Service (“NRCS”) reached a final agency decision to implement the Tumalo Irrigation District Irrigation Modernization Project (the “Project”). The stated purpose of the Project was to update antiquated and inefficient open-canal irrigation waterways to eliminate seepage water loss in the District's system, improve water delivery, benefit fish and aquatic habitat, and improve public safety. The Project was cosponsored by the District and the Deschutes Basin Board of Control.
A draft Environmental Assessment (“DEA”) for the Project was published for comment on April 16, 2018. AR 1399. NRCS considered 12 alternatives to the Project alternative but eliminated nine of them. The final agency decision to implement the Project was predicated upon Defendants' approval of a Project Environmental Assessment (“EA”) and a Finding of No Significant Impact (“FONSI”). Second Amended Complaint (“SAC”), ECF No. 62 at ¶¶ 13-14.
Plaintiffs own private property parcels that are burdened by the District's easements and rights-of-way. SAC at ¶ 4. They allege that if the Project moves forward, their property will suffer significant economic devaluation. SAC at ¶ 5. Plaintiffs therefore allege that their economic interests will be adversely affected and irreparably injured by the Project, and that the Project will eliminate certain benefits enjoyed by Plaintiffs. Id. at ¶¶ 5, 12. Plaintiffs' claims turn on the assertion that the approval process for the EA was deficient and that Defendants acted arbitrarily and capriciously, abused their discretion, and acted in excess of their statutory authority in contravention of the Administrative Procedures Act (“APA”), 5 U.S.C. 706(2)(a) and (c). SAC at ¶ 23. Plaintiffs allege that the EA failed to meet the requirements of the Watershed Protection and Flood Prevention Act because the Project failed to provide an adequate cost-benefit analysis and because the Project allows for hydroelectric power development. SAC at ¶¶ 26-27.
STANDARD OF REVIEW
Summary judgment is appropriate if the pleadings, depositions, answers to interrogatories, affidavits, and admissions on file, if any, show “that there is no genuine dispute as to any material fact and the [moving party] is entitled to judgment as a matter of law.” Fed.R.Civ.P. 56(a). Substantive law on an issue determines the materiality of a fact. T.W. Elec. Servs., Inc. v. Pac. Elec. Contractors Ass'n, 809 F.2d 626, 630 (9th Cir. 1987). Whether the evidence is such that a reasonable jury could return a verdict for the nonmoving party determines the authenticity of the dispute. Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 248 (1986).
The moving party has the burden of establishing the absence of a genuine issue of material fact. Celotex Corp. v. Catrett, 477 U.S. 317, 323 (1986). If the moving party shows the absence of a genuine issue of material fact, the nonmoving party must go beyond the pleadings and identify facts which show a genuine issue for trial. Id. at 324.
Special rules of construction apply when evaluating a summary judgment motion: (1) all reasonable doubts as to the existence of genuine issues of material fact should be resolved against the moving party; and (2) all inferences to be drawn from the underlying facts must be viewed in the light most favorable to the nonmoving party. T.W. Elec., 809 F.2d at 630.
DISCUSSION
The parties argue that they are each entitled to summary judgment on Plaintiffs' NEPA and Watershed Protection Act claims. For the reasons below, the Federal Defendants' motion for summary judgment should be granted.
I. NEPA Claims
Both Plaintiffs and the Federal Defendants argue that they are entitled to summary judgment on Plaintiffs' NEPA claim. Plaintiffs' First Claim for Relief (“NEPA claim”) alleges that the Federal Defendants violated NEPA because they approved an Environmental Assessment that “failed to consider a reasonable range of alternatives, including alternatives that would have accomplished the goal of improving water conservation and delivery efficiency without destroying the environmental character, functionality, and economic value of Plaintiffs' properties.” SAC at ¶ 19. The NEPA claim also alleges that the Federal Defendants failed to adequately consider other factors such as the cost of property devaluation; exceeded their statutory authority under the Watershed Protection Act by improperly considering power-costsaving benefits to private parties; and failed to consider the cumulative effects of the Project. Id. at ¶¶ 20-22. Plaintiffs allege that the Federal Defendants acted arbitrarily and capriciously, abused their discretion, and exceeded their statutory authority in contravention of the Administrative Procedures Act (“APA”), 5. U.S.C. §§ 706(2)(a) & (c).
The Federal Defendants argue that summary judgment is appropriate on Plaintiffs' NEPA claims because (1) the NRCS considered a reasonable range of alternatives; and (2) NRCS properly analyzed cumulative effects of the Project; (3) Plaintiffs' cost-benefit claim is unsupported; and (4) NRCS properly recognized a public safety risk from open irrigation channels. In addition to challenging Defendants' arguments, Plaintiffs argue that Defendants improperly narrowed the EA's purpose and need statement to predetermine the outcome of the analysis and to avoid public comment.
A. Reasonable Range of Alternatives
Plaintiffs allege that the Federal Defendants violated NEPA because they approved an Environmental Assessment (“EA”) that “failed to consider a reasonable range of alternatives, including alternatives that would have accomplished the goal of improving water conservation and delivery efficiency without destroying the environmental character, functionality, and economic value of Plaintiffs' properties.” SAC at ¶ 19. NEPA provides that the NRCS must include “a brief discussion[] ... of alternatives” in an EA. 40 C.F.R. § 1508.9. “The range of alternatives that an agency must consider under NEPA is based on the purpose and need of the proposed agency action.” Audubon Society of Portland v. Haaland, 40 F.4th 967, 981 (9th Cir. 2022). The Court reviews an allegations that an agency's review of NEPA alternatives is “arbitrary and capricious” under a “rule of reason” standard that requires an agency to set forth only those alternatives necessary to permit a reasoned choice. Presidio Golf Club v. Nat'l Park Service, 155 F.3d 1153, 1160 (9th Cir. 1998).
During the administrative process, NRCS studied a no-action alternative and two action alternatives after eliminating nine additional alternatives. AR 148-68. The NRCS also provided explanation for eliminating the nine alternatives, noting that they would not meet the Project's purpose and need to address the public safety risks from open irrigation waterways. Some of these alternatives were also eliminated due to “feasibility issues” because they required private installation and privately conserved water. AR 0277. Plaintiffs contest the Defendant's rationale regarding feasibility, presenting arguments about the feasibility of the on-farm efficiency alternative. ECF No. 115-1 at 7 (arguing that the on-farm efficiency alternatives, “had they been fully developed, may have more completely met the stated purpose to conserve as much or more of the water lost to seepage than the selected alternative”).
Defendants, however, are not required to show that they chose the best possible alternative to meet a project's stated purpose and need; rather, they are required to show only that their consideration of alternatives constitutes a “reasoned choice.” Presidio Golf Club, 155 F.3d at 1160. Here, the NRCS rejected the on-farm efficiency alternative in part because it would leave open irrigation channels and therefore would therefore not address the public safety purpose of the Project. AR 0145. The Court finds that rejection of the on-farm efficiency alternative reflects a sufficiently reasoned choice. Presidio Golf Club, 155 F.3d at 1160; see also Native Ecosystems, 428 F.3d at 1246 (an EA must provide “an appropriate explanation” for “why an alternative was eliminated”). Therefore, the NRCS's consideration of alternatives was neither arbitrary nor capricious because it met the rule of reason standard set forth by the Ninth Circuit in Presidio. 155 F.3d at 1160; 40 C.F.R. § 1508.9.
B. Improper Narrowing of EA
Plaintiffs contend that the Defendants improperly narrowed the scope of the EA to avoid public comment on plans to use the Project to develop hydroelectric power in violation of NEPA.NEPA does not allow a federal agency to unreasonably narrow an EA's purpose and need statement to predetermine the outcome of the analysis. See Environmental Defense Center v. Bureau of Ocean Energy Management, 36 F. 4th 850, 876 (9th Cir. 2022). In its opposition to Plaintiff's motion for a preliminary injunction, Tumalo Irrigation District indicated that the District's plans include “future installation of low-flow hydroelectric sites within its delivery system.” ECF No. 38 at 10 (citations omitted). Plaintiffs argue that because the public never had the opportunity to comment on the District's plans to develop hydroelectric power with the Project, the Federal Defendants should “re-open the Project for public comment now that it is clear the public was misled and misinformed.” ECF No. 116 at 3.
While Plaintiffs' SAC asserts this claim under the Watershed Protection Act, Plaintiffs' briefing frames the issue of hydroelectric power development as a NEPA violation, and the Court therefore considers it as such. See ECF No. 115-116. Insofar as Plaintiffs assert a claim under the Watershed Protection Act predicated on the improper development of hydroelectric power, Plaintiffs' motion for summary judgment on that claim should be denied for the reasons discussed in this subsection.
As the District's preliminary injunction motion was not before the agency at the time of the contested decision, the information contained therein constitutes “extra-record” material. A reviewing court may consider extra-record materials only: (1) if necessary to determine whether the agency has considered all relevant factors and explained its decision, (2) when the agency has relied on documents not in the record, (3) when supplementing the record is necessary to explain technical terms or complex subject matter, or (4) when plaintiffs make a showing of agency bad faith. Inland Empire Pub. Lands Council v. Glickman, 88 F.3d 697, 703-04 (9th Cir.1996). Exceptions to the normal rule regarding consideration of extra-record materials “only appl[y] to information available at the time, not post-decisional information.” Rock Creek Alliance v. U.S. Fish & Wildlife Serv., 390 F.Supp.2d 993, 1002 (D. Mont. 2005). When considering the Inland Empire factors, post-decision information “may not be advanced as a new rationalization either for sustaining or attacking an agency's decision” because “it inevitably leads the reviewing court to substitute its judgment for that of the agency.” Ctr. for Biological Diversity v. U.S. Fish & Wildlife Serv., 450 F.3d 930, 943 (9th Cir. 2006) (internal citations and quotations omitted); TriValley CARES v. U.S. Dep't. of Energy, 671 F.3d 1113, 1130-31 (9th Cir. 2012).
The administrative record before the Court shows that the purpose of the Project approved by Federal Defendants was to modernize the District's irrigation system, reduce water loss, and mitigate risks to public safety. AR 0033, 0074-77. The Federal Defendants accordingly approved of an irrigation project, not a hydroelectric power project. The Court will not consider extra-record materials such as the District's preliminary injunction motion because that evidence is barred from the Court's consideration in this NEPA action. Tri-Valley CARES, 671 F.3d at 1130-31.
C. Analysis of Cumulative Effects
Plaintiffs also allege that the Federal Defendants failed to consider the cumulative effects of the Project. SAC at ¶ 22. As an initial matter, Plaintiffs failed to raise this claim during the NEPA process. Specifically, Plaintiffs Smith and Callen failed to raise concerns about the agency's cumulative effects analysis when they submitted comments on the DEA during the public comment period. When a particular issue is not presented to an agency during the appropriate comment period in the NEPA process, the issue is waived from later litigation. Pub. Citizen, 541 U.S. at 764-65. By failing to raise this claim during the administrative process, Plaintiffs failed to put the NRCS on notice of their concerns regarding the cumulative effects of the Project. See Oregon Nat. Desert Ass'n v. Jewell, 840 F.3d 562, 571-74 (9th Cir. 2016) (failure to make specific arguments about a particular issue during the comment period did not put the agency on notice and that issue was therefore not subject to judicial review).
Nevertheless, the Federal Defendants had an “opportunity to consider the Project's cumulative effects on riparian ecosystems” during the notice and comment period. ECF No. 118 at 3. In the Ninth Circuit, on review of a notice-and-comment proceeding, courts will not invoke the “waiver rule” to dismiss a claim that was not raised during the administrative process “if an agency has had an opportunity to consider the issue.” Portland General Elec. Co. v. Bonneville Power Admin., 501 F.3d 1009, 1024 (9th Cir. 2007). The Court therefore declines to apply the waiver rule to Plaintiffs' cumulative effects claim and finds that the Federal Defendants met their statutory burden to properly analyze the Project's cumulative effects.
NEPA requires that an EA must contain a “brief” discussion of environmental effects. 40 C.F.R. § 1508.9(b). The EA approved by Defendants contains two paragraphs of cumulative effects analysis and concludes that adverse cumulative effects of the Project will be “minimal and localized.” AR 0225. Plaintiffs argue that this brief summary fails to include the requisite “quantified or detailed information” to support the EA's conclusion, citing Center for Community Action and Environmental Justice v. Federal Aviation Administration, 61 F. 4th 633, 644 (9th Cir. 2023). The Court disagrees. The EA's cumulative effects analysis contains sufficient detail to meet the NEPA standard. 40 C.F.R. § 1508.9(b). The EA analysis considers the impacts to localized artificial wetlands created through leakage from the canal and laterals; and notes that the Project would benefit downstream riparian wetlands by protecting streamflow in Crescent Creek and Tumalo Creek. AR 0225. The analysis also notes that effects of the Project would be minor relative to current maintenance and use of agricultural infrastructure in the Project area, as well as livestock grazing and development. The EA also contains a table of quantified effects within the relevant areas that specified how the Project defined the duration of effects. AR 0439-44. The EA thus satisfied NEPA's requirements regarding cumulative environmental effects. 40 C.F.R. § 1508.9(b).
D. Cost-Benefit Claim
Plaintiffs' claim also alleges that the Federal Defendants failed to consider “the cost of property devaluation” and the “risk of unsecured funding” for the Project in violation of NEPA. As this Court previously noted, however, there is no NEPA precedent requiring an agency to calculate or monetize costs and benefits in an EA. See ECF 50 at 9. In the Court's Opinion denying Plaintiff's motion for a preliminary injunction, the Court noted that it was unnecessary for the EA to include a “formal and mathematically expressed cost-benefit analysis.” ECF No. 50 at 9, citing Trout Unlimited v. Morton, 509 F.2d 1276, 1282 (9th Cir. 1974). As the Court explained:
.. .NEPA was enacted to protect the environment, not a party's economic interest. See, e.g., Nv. Land Action Ass'n v. U.S. Forest Serv., 8 F.3d 713, 716 (9th Cir. 1993) (“The purpose of NEPA is to protect the environment, not the economic interests of those adversely affected by agency decisions.”). As a result, it was unnecessary for the EA to include a cost-benefit analysis.Id. Because NEPA does not require Defendants to include a cost-benefit analysis in the EA, Defendants' motion for summary judgment should be granted on Plaintiffs' cost-benefit claim.
E. Public Safety Risks
Plaintiffs' NEPA claim also challenges the need to address a public safety risk from open irrigation channels. See SAC at ¶ 18 (referring to public safety concerns as part of “a suite of sham justifications”). The EA must include a brief discussion of the need for a proposal. 40 C.F.R. § 1508.9(b). In the Ninth Circuit, agencies are given “considerable discretion to define a project's purpose and need.” Alaska Survival v. Surface Transp. Bd., 705 F.3d 1073, 1084 (9th Cir. 2013) (citations omitted). Here, the EA identified the mitigation or elimination of drowning risks from open irrigation channels as a project need. AR 0076. Despite Plaintiff's allegations, the EA's identification of public safety risks is supported by substantial evidence, including a central Oregon newspaper article cited in the administrative record noting concerns over safety of urban canals and reporting on a boy's death by drowning. AR 0106, 0258. The EA confirmed that the Project would eliminate any drowning risk from open irrigation channels, providing a public safety benefit. AR 0182. On this record, the EA's public safety rationale was based on a public need and supported by substantial evidence in the record. Monjaraz-Munoz v. I.N.S., 327 F.3d 892, 895 (9th Cir. 2003) (An agency's factual findings are reviewed for substantial evidence, under which a court must “uphold the [agency's] findings unless the evidence presented would compel a reasonable finder of fact to reach a contrary result”) (internal quotations omitted).
For these reasons, Defendants' motion for summary judgment on Plaintiffs' NEPA claims should be granted. Plaintiffs' motion for summary judgment on these claims should accordingly be denied.
II. Watershed Protection and Flood Prevention Act
Plaintiffs and the Federal Defendants also argue that they are entitled to summary judgment on Plaintiffs' Second Claim for Relief. Plaintiffs' Second Claim for Relief alleges that the cost-benefit analysis set forth in the EA failed to meet the requirements of the Watershed Protection and Flood Prevention Act (“Watershed Protection Act”), and that the Project allowed hydroelectric power development, also in contravention of the Watershed Protection Act. Plaintiffs allege that the Federal Defendants thus acted arbitrarily and capriciously, abused their discretion, and exceeded their statutory authority in contravention of the APA, 5 U.S.C. §§ 706(2)(a) & (c).
The Federal Defendants argue that summary judgment is appropriate on Plaintiffs' Watershed Protection Act claims because the EA cost-benefit analysis met the requirements of the Act. In their Motion for Summary Judgment, Plaintiffs contest these allegations and also argue that the Federal Defendants violated the Watershed Protection Act because the Project was ineligible for federal funding under 7 C.F.R. 622.11(a)(6). ECF No. 115-1 at 14-15.
A. 7 C.F.R. 622.11(a)(6) Claim
Plaintiffs argue that the Federal Defendants violated the Watershed Protection Act because the Project was ineligible for federal funding. 7 C.F.R. 622.11(a)(6), promulgated under the Act, provides six eligibility criteria for watershed projects to receive federal assistance. Plaintiffs argue that the Federal Defendants “exceeded their authority by funding the Project with [Watershed Protection Act] funds,” because such funding is eligible only if the Project “[c]annot be installed by individual or collective landowners under alternative cost-sharing assistance.” ECF No. 115-1 at 15, citing 7 C.F.R. 622.11(a)(6).
As a threshold matter, Plaintiffs failed to raise any such concerns during the public comment period or in their operative complaint. See SAC at ¶¶ 24-28 (Plaintiffs' Second Claim for Relief under the Watershed Protection Act). The Court will not grant summary judgment on a claim that does not appear in the operative complaint. See, e.g., Wasco Products v. Southwall Technologies, Inc., 435 F.3d 989, 992 (9th Cir. 2006); Navajo Nation v. U.S. Forest Servs., 535 F.3d 1058 (9th Cir. 2008) (declining to reach the merits of a claim because it was not properly pled in the operative complaint). Plaintiffs' motion for summary judgment on this claim should therefore be denied.
Insofar as Plaintiffs have raised arguments about the Project's eligibility for federal funding under the Watershed Protection Act, these allegations have not been stated in either the Complaint (ECF No. 1) or in the SAC. Plaintiffs concede this point in their Reply. ECF No. 118 at 9.
As to Plaintiffs' assertion that the Project goals could have been met through efforts of individual or collective landowners, this Court previously noted that it would be “infeasible” for landowners to install the project. ECF No. 50 at 11. Further, as this Court also noted in its Order denying Plaintiffs' motion for a preliminary injunction, there is nothing in 7 C.F.R. 622.11(a)(6) requiring an agency to make formal findings about funding eligibility. ECF No. 50 at 11.
B. Cost-Benefit Claim
Plaintiffs' Second Claim for Relief alleges that the cost-benefit analysis set forth in the EA failed to meet the requirements of the Watershed Protection Act. In their Motion for Summary Judgment, Plaintiffs assert that the EA “fabricated the cost-benefit analysis by ignoring the Project's actual costs and overinflating the Project's actual benefits.” ECF No. 1151, at 16. Like their claim regarding funding eligibility under 7 C.F.R. 622.11(a)(6), Plaintiffs failed to raise any claim based on the Project's cost-benefit analysis during the administrative process prior to the Federal Defendants' adoption of the EA. See Pub. Citizen, 541 U.S. at 76365 (2004) (A party forfeits arguments that are not raised during an agency's administrative process). Nevertheless, the Federal Defendants considered the costs and benefits of the project during the notice and comment period. Because the agency had an opportunity to consider the issue, Plaintiffs' cost-benefit claim is not barred by administrative waiver. Portland General Elec. Co., 501 F.3d at 1024.
The Watershed Protection Act requires that the agency determine that a project's “benefits exceed the costs.” 16 U.S.C. § 1005(1). Pursuant to the Watershed Protection Act, Defendants published a National Economic Development Analysis (“NED analysis”) in addition to the EA that “evaluates the costs and benefits” of the Project. AR 0348-85. In the NED analysis, the agency explained its rational cost-benefit methodology and findings, and the Court finds no reason to disturb this analysis. See California v. Becerra, 950 F.3d 1067, 1096 (9th Cir. 2020) (en banc) (courts defer to the agency's expertise in interpreting the record and its predictive judgment on relevant questions). The Court therefore finds that Defendants' motion for summary judgment should be granted on Plaintiffs' Second Claim for Relief.
RECOMMENDATION
For the reasons above, the Federal Defendants' motion for summary judgment (ECF No. 112) should be GRANTED. Plaintiffs' motion for partial summary judgment (ECF No. 115) should be DENIED. Plaintiffs' federal claims should be dismissed.
This recommendation is not an order that is immediately appealable to the Ninth Circuit Court of Appeals. Any notice of appeal pursuant to Federal Rule of Appellate Procedure 4(a)(1) should not be filed until entry of the district court's judgment or appealable order. The Findings and Recommendation will be referred to a district judge. Objections to this Findings and Recommendation, if any, are due fourteen (14) days from today's date. See Fed.R.Civ.P. 72. Failure to file objections within the specified time may waive the right to appeal the district court's order. Martinez v. Ylst, 951 F.2d 1153, 1157 (9th Cir. 1991).