Federal Court Ruling to Impact Projects Seeking Nationwide Permit 12

A frequently used nationwide permit (NWP) for utility line project development in wetland areas was revoked by a federal court on April 15. The ramifications of this ruling will be felt most heavily by U.S. pipeline companies, utilities, engineers, builders, land developers and other construction companies. Without the NWP 12, projects may require unique solutions to avoid schedule delays. (Updated ruling, July 2020)

The impetus of this was Northern Plains Resource Council v. U.S. Army Corps of Engineers, heard in the District Court of Montana concerning the Keystone XL Oil Pipeline. The court determined that the U.S. Army Corps of Engineers (USACE) did not adequately verify that the pipeline would not adversely affect endangered species. It also determined that the process for evaluating potential impacts to protected species as part of the NWP 12 evaluation was flawed due to the requirement for the applicant to self-determine potential for impacts (General Condition 18).

The court vacated NWP 12 and remanded it to the USACE to comply with the Endangered Species Act (ESA). The USACE must now verify that the cumulative effects of the thousands of uses of NWP 12 will not adversely affect endangered species. USACE has now directed all districts to immediately cease authorization of projects under of NWP 12.

The removal of this heavily utilized NWP may have far-reaching effects across a range of industries. Although the USACE will likely challenge the ruling’s applicability to the entire country and will attempt to restrict the vacating of NWP 12 to only the District of Montana, questions remain around whether the ruling could impact projects retroactively as well. At a time when owners are already challenged by the coronavirus pandemic, utility line projects will be further disrupted while NWP 12 is unavailable for use. Until regulatory guidance is finalized, here are a few options to consider while navigating uncertain permitting conditions:

• Seek alternative nationwide permits. One of the simplest approaches is to obtain a different NWP that would also apply to your project. Some common viable substitutions include: NWP 3 –  maintenance, 14 –  linear transportation projects, 18 – minor discharges, 25 – structural discharges, 33 – temporary construction access and dewatering and 51 –  land-based renewable energy. Projects would still need to meet the conditions required for the NWP and comply with the ESA. It is important to watch how the NWPs continue to be used as this ruling potentially opens the door for similar challenges to other NWPs, since all of the NWPs were issued in 2017 without formal consultation under Section 7 of the ESA. 
• Utilize individual permits. Another option for projects is to go through the individual permit (IP) process. Although an IP traditionally takes longer than an NWP, it includes the ESA review that is being challenged and would therefore be protected from the current judicial disputes. Another barrier related to the IP process is that it opens the project up to public scrutiny though the public notice requirement. Diligent coordination of the design, timing and location of project activities enhances a project’s chance of navigating the USACE permitting process successfully.

The interplay between engineering, environmental permitting and construction is complicated on any project. These challenges are only escalated with the uncertainty in NWPs and increased scrutiny by the federal courts. Every project will require unique and creative solutions to keep projects on track and within regulation and industries will need to stay on top of the changing regulatory environment.

Wetland scientists with extensive permitting experience can help your project navigate the latest federal, state and local requirements regarding wetlands and other waters.