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DEIDRE G. DUNCAN DIRECT DIAL: 202 • 955 • 1919 EMAIL: dduncan@hunton.com FILE NO: 29142.080061

March 30, 2015

The Honorable Jo-Ellen Darcy Assistant Secretary of the Army, Civil Works Department of the Army 108 Army Pentagon Washington, DC 20310 Re: Implementation of National Marine Fisheries Service Biological Opinion on U.S.

Army Corps of Engineers’ Nationwide Permit Program Dear Assistant Secretary Darcy: We submit this letter on behalf of the American Gas Association (AGA), American Petroleum Institute (API), Edison Electric Institute (EEI), Interstate Natural Gas Association of America (INGAA), and Utility Water Act Group (UWAG). These organizations represent a large cross-section of the nation’s energy and infrastructure sectors. These sectors rely on nationwide permits (NWPs) issued under the Clean Water Act (CWA) for their operations, maintenance, and new construction. We are writing to identify serious deficiencies in the National Marine Fisheries Service (NMFS) Biological Opinion (BiOp) on the U.S. Army Corps of Engineers’ (Corps) Nationwide Permit Program (November 2014) (hereinafter, 2014 BiOp), and to raise several important concerns about the Corps’ implementation of the NMFS BiOp. Specifically, we request:

An opportunity for public comment on any implementation guidance to Corps Districts;

Clarification of circumstances in which a pre-construction notification (PCN) may be required for NWPs 12, 13, 14, and 36, in connection with the addition of impervious surface cover to waters of the U.S.;

The addition of exemptions from any new impervious surface PCN requirements for de minimis amounts of impervious surface cover added and for instances where the proposed activities result in a net neutral or reduced impact on overall impervious surface cover;

Adequate opportunity for and consideration of public comments on the rulemaking for NWPs 12, 13, 14, and 36;

The Honorable Jo-Ellen Darcy March 30, 3015 Page 2

That the Corps evaluate the validity or benefit of the measures identified in the 2014 BiOp, provide the public with an opportunity to comment on those measures, and confirm that it has not prejudged the outcome of any NWP-related rulemaking; and

That the Corps avoid unnecessary disruption or burdens on the important public and commercial activities that use NWPs by taking a circumspect and judicious approach to adding any new restrictions or requirements in the 2017 NWPs.

I. Corps and NMFS ESA Section 7 Consultation on NWP Reissuance

The Corps reissued the NWPs on February 13, 2012, and they went into effect on March 19, 2012. On February 15, 2012, NMFS issued a programmatic BiOp on the Corps’ overall NWP program (hereinafter, 2012 BiOp). Although the NWP “program” is not a discrete agency action subject to consultation, NMFS proceeded to issue a biological opinion on the program and to make a finding that the program was not adequately structured to “ensure against jeopardy.” This finding was itself improper: a biological opinion must determine whether an action is likely to cause jeopardy, not whether a program is structured to prevent jeopardy. Nonetheless, the Corps requested reinitiation of consultation with NMFS. In an October 2012 letter to NMFS, the Corps clarified that reissuance of the NWPs had “no effect” on listed species and did not require consultation under section 7 of the Endangered Species Act (ESA), but agreed to continue consultation with NMFS on a “voluntary basis.” On December 14, 2012, a coalition including the undersigned organizations submitted a letter to NMFS, identifying numerous and substantial deficiencies and inaccuracies in the 2012 BiOp.1 In particular, the 2012 BiOp suffered from a serious misunderstanding of the Corps’ NWP program; failed to make a finding that jeopardy or adverse modification is “likely” or provide a factual basis for an affirmative jeopardy or adverse modification finding as required by the ESA and applicable regulations; and failed to comply with regulatory requirements. NMFS issued a new BiOp on the NWP program on November 24, 2014. The 2014 BiOp concludes that, with the implementation of certain new protective measures agreed to by the Corps, as well as the other existing protections of the NWP program, the NWP program is not likely to jeopardize the continued existence of listed species or destroy or adversely modify critical habitat. The new 2014 BiOp replaces the prior 2012 BiOp. Unfortunately, the 2014 BiOp does not address many of the concerns raised in our December 2012 letter. We are equally, if not more, concerned about the flaws in the new 2014 BiOp and the Corps’ planned approach for implementing the 2014 BiOp.

1 See Letter from American Farm Bureau, et al., to Eric C. Schwaab, Acting U.S. Department of Commerce

Assistant Secretary for Conservation and Management (Dec. 14, 2012), included as Attachment 1.

The Honorable Jo-Ellen Darcy March 30, 3015 Page 3 II. NMFS’ 2014 BiOp and the Corps’ Agreement to Implement the 2014 BiOp Raise

Serious Concerns

The 2014 BiOp, like the 2012 BiOp before it, suffers from a number of legal infirmities. The Corps’ agreement to implement the 2014 BiOp thus raises a number of serious concerns. Many of our concerns were discussed in detail in our December 2012 letter. The following is a summary of some of our major concerns with the 2014 BiOp:

The 2014 BiOp Incorrectly Treats the Overall NWP Program as a Discrete Action Subject to Consultation. Like the 2012 BiOp, the 2014 BiOp wrongly treats the overall NWP program as a discrete “action” properly subject to ESA section 7 consultation. The NWP program is comprised of a variety of components, only some of which could be properly characterized as “actions” when taken.

The 2014 BiOp Incorrectly Treats its Provisions as Mandatory Despite Recognition That Corps Undertook Consultation Voluntarily. The 2014 BiOp recognizes that the Corps “voluntarily” participated in consultation, yet treats the consultation as mandatory by making a “no jeopardy” determination tied to the Corps’ agreement to undertake certain protective measures. If the Corps fails to undertake any of these protective measures, or if certain other circumstances arise (e.g., listing of new species that may be affected), the 2014 BiOp purports to require reinitiation of formal consultation. 2014 BiOp at 357. Thus, despite the fact that the NWP program is not an “action” subject to consultation, and the Corps’ determination that section 7 consultation was voluntary, the 2014 BiOp incorrectly treats its provisions as mandatory, suggests that reinitiation of formal consultation would be required in certain circumstances, and purports to bind the Corps to implement certain protective measures.

The 2014 BiOp Fails to Recognize the Highly Protective ESA Elements of the NWP

Program. Our December 2012 letter discusses in detail the NWP program’s numerous protections for listed species and designated critical habitat. The 2014 BiOp makes a “no jeopardy” determination tied to the Corps’ agreement to undertake certain protective measures, but requiring the Corps to implement these protective measures ignores the extensive protections already provided through the NWP program. For example, the 2014 BiOp provides that the Corps will conduct rulemaking to modify NWPs 12, 13, 14, and 36 to require PCN for proposed activities that add permanent impervious surface cover in waters of the U.S. in watersheds inhabited by listed species and designated critical habitat under NMFS’ jurisdiction, 2014 BiOp at 68, but General Condition (GC) 18 already requires a PCN for a wide range of circumstances in which there is some potential for effects to listed species or critical habitat, such as where listed species or critical habitat “might be affected” or are “in the vicinity” of the project. The BiOp

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provides no demonstration that this new PCN requirement is necessary in light of GC 18, and does not explain why the requirement would not be duplicative and wasteful.

In sum, the NWP “program” is not a discrete agency action subject to consultation, the 2014 BiOp was not necessary, and the 2014 BiOp suffers from numerous deficiencies. The examples provided herein are an illustrative, rather than exhaustive, list. Accordingly, the undersigned organizations have serious concerns with the Corps’ consideration of implementing the BiOp.

III. The Corps Should Consider These Five Recommendations for Implementation of

the 2014 BiOp

The undersigned organizations also have serious concerns regarding the specific approaches that the Corps may take to implement the 2014 BiOp. The following are some of our major concerns, including, as appropriate, recommendations for implementation of the 2014 BiOp:

The Public Should Have The Opportunity to Provide Input on All Implementation Guidance. We understand that the Corps anticipates developing separate guidance documents for implementing the different protective measures identified in the 2014 BiOp. It is critical that the Corps solicit public input on the proposed language of these guidance documents. Allowing for public comment benefits the Corps’ regulatory program – and the regulated community – by providing a mechanism to better understand and discuss how the guidance documents will practically affect the NWP permitting process. Moreover, public involvement is critical because these guidance documents are likely to have implications beyond the NWP program. For example, the Corps committed to issue guidance on conducting cumulative effects analyses for the purposes of the National Environmental Policy Act (NEPA), CWA Section 404(b)(1) Guidelines, and the ESA. 2014 BiOp at 67. The language in the 2014 BiOp suggests that this guidance will be used by the Corps not just for the NWP program, but in all types of Corps permitting. Such a major change to the Corps’ regulatory program should be subject to public review and comment.

The Corps Should Clarify Circumstances in Which the PCN Requirement Does Not Apply to NWPs 12, 13, 14, and 36. The Corps has committed to conduct a rulemaking to modify NWPs 12, 13, 14, and 36 to require PCN for activities that add impervious surface cover2 in waters of the U.S. in watersheds inhabited by listed species and designated critical habitat under NMFS’ jurisdiction. We understand that this PCN

2 The 2014 BiOp relies on a National Research Council definition of “impervious surface,” which defines

the term as “a hard surface area which either prevents or retards the entry of water into the soil. Common impervious surfaces include roof tops, walkways, patios, driveways, parking lots or storage areas, concrete or asphalt paving, gravel roads, packed earthen materials, and oiled surfaces.” 2014 BiOp at 269.

The Honorable Jo-Ellen Darcy March 30, 3015 Page 5

requirement is limited to impervious surface cover added by the permanent placement of fill material into waters of the U.S. In any proposed rulemaking, we request that the Corps clarify circumstances in which the PCN requirement does not apply. It would not include, for example, impervious surface added to uplands, or impervious surface cover added by temporary fill for construction of a pipeline. Nor would a wood support pole be considered to be an addition of impervious surface cover. It is important for prospective permittees and District staff that the Corps clarify what activities will trigger the new PCN requirement.

The Corps Should Provide a De Minimis Exception to the PCN Requirement for NWPs 12, 13, 14, and 36. We understand that the Corps intends to treat the addition of any permanent surface cover (even a square inch) to waters of the U.S. as triggering the PCN requirement. This would mean that even a de minimis addition of permanent impervious surface cover would trigger the PCN requirement for NWPs 12, 13, 14, and 36. Requiring PCN for a de minimis addition of impervious surface cover will substantially increase burdens for NWP permittees and for the District staff. It will slow the NWP approval process without providing commensurate benefits for protection of listed species and designated critical habitat. Indeed, there may be little utility in using NWPs 12, 13, 14, and 36 if even a de minimis addition of impervious surface cover triggers the costly and burdensome PCN requirement. Accordingly, we request that the Corps consider providing a de minimis exception to this PCN requirement.

The Corps Should Provide An Exception to the PCN Requirement Where There Is a Net Neutral or Reduced Impact on Overall Impervious Surface Cover in Waters of the U.S. Again, it is problematic that the Corps would view any addition of impervious surface cover as triggering the PCN requirement for NWPs 12, 13, 14, and 36. There may be instances, for example, where an activity would add some amount of impervious surface cover, but the prospective permittee plans to perform mitigation such that the proposed activity would result in a net neutral or reduced impact on overall impervious surface cover. In those instances, proposed mitigation could offset the addition of impervious surface cover and eliminate the need for a PCN. We recommend that the Corps provide an exception to the PCN requirement for NWPs 12, 13, 14, and 36 where there is a net neutral or reduced impact on overall impervious surface cover.

The Agencies May Not Prejudge the Outcome of Rulemaking on NWPs 12, 13, 14, and 36. Through this ESA section 7 consultation process and, going forward, the threat of “requiring” a reinitiated consultation on that program if the Corps fails to implement the identified protective measures, NMFS is exercising inappropriate influence over and driving a Corps CWA regulatory program. Equally concerning is the Corps’ commitment to make burdensome, uncertain, and unnecessary rulemaking changes without public involvement and prior to public notice and comment. In particular, NMFS