ELR Citation: ELR 20874
No(s). s. 87-6275, -6295 (2d Cir. Jun 8, 1988)

The court holds that the Environmental Protection Agency's (EPA's) veto under §404(c) of the Federal Water Pollution Control Act (FWPCA) of a dredge and fill permit was based on a reasonable interpretation of the "availability" of an alternative site under the FWPCA §404(b)(1) guidelines. Plaintiff developer purchased wetland property and sought a permit from the Corps to build a shopping mall. Following the Corps' approval of the permit application, EPA prohibited the proposed development under §404(c) because of the possible adverse effects on wildlife and the availability of a feasible alternative site. The court first holds that EPA's consideration of the availability of other sites when plaintiff entered the market to investigate property in the area, rather than the time at which plaintiff applied for a permit, was not inconsistent with the §404(b)(1) guidelines or past Agency practice. The guidelines' use of the present tense should not be read so narrowly and literally as to create a time-of-application rule. To look only at the time of application would remove the incentive for a developer to search for an alternative when selecting a particular site. Consideration of the time of the applicant's entry into the market is not inconsistent with the past practices of the Corps and EPA, since this precise issue has never arisen before. The court holds that, although EPA's market entry interpretation of the §404(b)(1) guidelines may not be entitled to deference, it was reasonable.

The court holds that EPA's market entry interpretation is specific enough to put the public on notice of when it must consider alternative sites. The court also holds that EPA's application of its interpretation of availability was not fundamentally unfair. EPA did not create a new standard and apply it retroactively to plaintiff; rather, EPA interpreted the existing law to apply it to the unique facts of this case. Moreover, EPA did not unfairly fail to address evidence that plaintiff had entered the market after the alternative site had become unavailable, because the extensive administrative record supports EPA's determination that the other site was still available when plaintiff began to investigate making a purchase. Finally, the court holds that the district court, in upholding EPA's final determination, did not improperly supply a rationale for EPA's decision that the Agency itself did not articulate. The district court reasoned that plaintiff had probably entered the market at a time when the alternate site was still available, since developers usually investigate potential development sites for many months. Although EPA did not use this reasoning as a basis for its determination, the Agency did articulate other reasons in support of its decision.

The dissent would interpret the §404(b)(1) guidelines to require consideration of alternatives existing at the time of the Agency's decision on the application.

[The district court opinion is published at 18 ELR 20001. Briefs submitted to the district court are digested at ELR PEND. LIT. 65941. Briefs submitted to the court of appeals are digested at ELR PEND. LIT. 65996. Related federal decisions are published at 16 ELR 20033 and 20795. A related state case is published at 18 ELR 20118.]

Counsel for Appellants
Albert J. Beveridge III
Beveridge & Diamond
1333 New Hampshire Ave. NW, Washington DC 20036
(202) 828-0200

Counsel for Appellees
Donald A. Carr
Land and Natural Resources Division
Department of Justice, Washington DC 20530
(202) 724-7352

Before Pratt and Miner, JJ