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Kentuckians for Commonwealth v. United States Army Corps of Eng'rs

United States District Court, W.D. Kentucky

August 23, 2013


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For Kentuckians for the Commonwealth, Sierra Club, Plaintiffs: Jennifer C. Chavez, Neil E. Gormley, LEAD ATTORNEYS, Earthjustice, Washington, DC; Stephen A. Sanders, LEAD ATTORNEY, Appalachian Citizens' Law Center, Inc., Whitesburg, KY; J. Michael Becher, Appalachian Mtn Advocates, Lewisburg, WV.

For United States Army Corps of Engineers, Thomas P. Bostick, Luke T. Leonard, Defendants: Brady Miller, LEAD ATTORNEY, U.S. Attorney Office - Louisville, Louisville, KY; Paul Cirino, Ruth Ann Storey, LEAD ATTORNEYS, U.S. Department of Justice - Environment & Natural Resources, Washington, DC.

For Leeco, Inc., Intervenor Defendant: Kevin M. McGuire, LEAD ATTORNEY, Laura P. Hoffman, Jackson Kelly, PLLC - Lexington, Lexington, KY; Robert G. McLusky, LEAD ATTORNEY, Jackson Kelly, PLLC - Charleston, Charleston, WV.


Thomas B. Russell, Senior United States District Judge.

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Plaintiffs, Kentuckians for the Commonwealth (" KFTC" ) and the Sierra Club, brought this action seeking a declaration that the U.S. Army Corps of Engineers (" the Corps" ) violated the Clean Water Act (" CWA" ) and the National Environmental Policy Act (" NEPA" ) in issuing a permit to Leeco, Inc. (" Leeco" ), authorizing the corporation to mine-through and fill several unnamed tributaries of Stacy Branch and Yellow Creek. Plaintiffs request injunctive relief and seek judicial review of the agency's decision under the Administrative Procedure Act (" APA" ).

Currently before the Court are a series of cross motions for partial summary judgment. First, Plaintiffs filed their Motion for Partial Summary Judgment on January 28, 2013, as to their human health effects claims in Counts I, II, and III. (DN 21.) Defendants responded with their own Motions for Partial Summary Judgment, (DN 33 & 34), to which Plaintiffs filed a combined response. (DN 40.) Defendants have replied. (DN 44 & 45.) Upon leave from the Court, Plaintiffs have also filed a surreply. (DN 54.)

Thereafter, the Court requested expedited briefing as to Plaintiffs' water quality claims in Count IV of their Complaint. Plaintiffs filed their Motion for Partial Summary Judgment on July 8, 2013. (DN 62.) Defendants responded with their own combined Motions for Partial Summary Judgment and responses, (DN 66 & 68), to which Plaintiffs filed a combined reply. (DN 69.) These matters are now ripe for adjudication.

For the following reasons, Plaintiffs' Motion as to Counts I, II, and III (DN 21) and as to Count IV (DN 62) are DENIED and Defendants' Motions (DN 33, 34, 66 & 68)) are GRANTED.


Surface mining entails the excavation of rock to expose and remove coal seams. Once the coal is extracted, as much as possible of the excavated rock (called " spoil" ) is returned to the mine site in an attempt to restore natural ground contour. However, because the loosening of the rock and soil and incorporation of air causes the spoil to " swell" to occupy more volume, much cannot be returned to the area where it was blasted. Rather, the spoil is placed in " fills" located in adjacent hollows (" hollow fills" or " valley fills" ) that, due to the landscape of the Central Appalachian

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region, often contain headwater streams. As discussed in further detail below, surface mining laws require that the drainage from both hollow fills and " mine through" areas pass through sediment control ponds or structures before being discharged into downstream waters. Each of these activities is subject to a series of overlapping permits and certifications involving both federal and state agencies, one of which is at issue here.

Plaintiffs initiated this challenge in October 17, 2012, after the Corps' Louisville District Office issued Permit No. LRL-2007-217 (" the Permit" ) and its accompanying Permit Evaluation and Decision Document (" Decision" or " Decision Document" ) to Intervening Defendant Leeco, pursuant to Section 404(a) of the CWA, 33 U.S.C. § 1344(a). The Permit authorizes Leeco to discharge fill materials into streams that qualify as " waters of the United States" under the CWA and accompanying regulations. The discharges relate to Leeco's plan to construct one hollow fill, one sediment control pond, and various " mine throughs" on unnamed tributaries of Stacy Branch and Yellow Creek of Carr Creek, located in Knott and Perry Counties, Kentucky, as part of its nearby surface coal mining operations.

On February 7, 2007, Leeco filed its original application for a permit under CWA § 404 to discharge fill material into the waters of the United States. Leeco's original proposal sought to construct six hollow fills and six sediment control ponds in various unnamed tributaries of Carr Creek. The proposed construction involved discharges into 22,761 linear feet of stream. As part of its application, Leeco submitted the Kentucky Division of Mine Permits' (" KDMP" ) authorization of the mine.

The Corps issued public notice for Leeco's application on April 17, 2007, with a comment period extending through May 16, 2007. During this time period, Margaret Janes, on behalf of various environmental groups, submitted comments objecting to issuance of the permit. Leeco subsequently advised the Corps that it intended to supplement its application on various issues, including avoidance and minimization, water monitoring, and mitigation.

Then, on June 11, 2009, the Department of the Army, the Environmental Protection Agency (" EPA" ), and the U.S. Department of the Interior (" DOI" ) entered into a Memorandum of Understanding (" MOU" ) announcing the implementation of an interagency plan to reduce the harmful environmental consequences of surface coal mining in Appalachia. One of the elements of this plan was an " enhanced coordination process" regarding Section 404 permit applications for certain Appalachian surface coal mining activities submitted prior to the MOU's execution. [1] Leeco's application was one that was recommended for additional coordination and review.

Accordingly, a 60-day formal coordination period began in September 2010 and was extended several times by mutual agreement. During the coordination period, the EPA advised the Corps that, based on its review of Leeco's permit application, it had " significant concerns" in five areas, including the avoidance and minimization of adverse environmental impacts, water quality monitoring, mitigation, and fill placement optimization. (EPA Letter 10/22/2010, Ex. D, DN 34-5.) The fifth,

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titled " NEPA and Environmental Justice issues," addressed the EPA's concerns that " the proposed project may have significant human health impacts on the surrounding communities, all of which are low-income communities." ( Id. ) The EPA outlined its concerns in further detail in a subsequent communication with the Corps. (EPA Letter 12/14/2010, Ex. E, DN 34-6.)

After engaging in this coordination process, Leeco submitted a revised permit application on July 19, 2011. The revised configuration proposed construction of a single, large hollow fill and sediment pond. The new design would " impact" --Defendants' term--or " destroy" --Plaintiffs' term--a total stream length of 18,268 linear feet, or 3.5 miles, reducing the original proposal's impact by 4,593 linear feet. As mitigation, Leeco proposed to pay $752,047.50 to the Kentucky Department of Fish and Wildlife Stream and Mitigation Trust Fund for restoration projects in the vicinity of the project area. Leeco also agreed to restore 3,617 linear feet of streams at the Spring Branch Mitigation Site in Wolfe County, Kentucky. The revised application also included a Compensatory Mitigation Plan (" CMP" ) for the Spring Branch site, which describes the location, goals and objectives, performance standards, and monitoring plan for the mitigation project.

Due to the revisions, the Corps issued an addendum to the Public Notice on August 5, 2011, with a comment period extending through August 19, 2011. On behalf of Sierra Club, Margaret Janes submitted comments objecting to the proposal (" August Comments" ). The August Comments quoted excerpts from three studies that " have shown that coal mining has significant, negative impacts on the health of those living in the coal fields" and cited the portion of the EPA's October 22, 2010, letter discussing NEPA and environmental justice issues. (Janes Comments 8-8-11, Ex. C, 58-59, DN 21-3.) On November 11, 2011, Sierra Club submitted supplemental comments that, in addition to the previous information in the August Comments, included another study linking increased birth defects to mining activities. (Janes 11-11-11 Comments, Ex. G, 9-10, DN 21-7.) The comments also contained a number of sections dedicated to mitigation issues. ( Id. at 31-51, 59-62.) On February 15, 2012, at the Corps' request, Leeco submitted a response to the Sierra Club's comments.

On April 3, 2012, the EPA informed the Corps it had no further concerns regarding the proposed project. On May 25, 2012, the Corps completed its review. In its decision, the Corps found awarding the permit would " not significantly affect the quality of the human environment" and that, therefore, no environmental impact statement was required under the NEPA. (Permit Evaluation and Decision Document, 52, DN 28-2.) The permit went into effect on July 26, 2012.

On October 17, 2012, Plaintiffs filed the present civil action. In Count I of their Complaint, Plaintiffs argue that the Corps failed to take the required " hard look" at environmental impacts under NEPA. In Count II, Plaintiffs argue that the Corps did not consider or prevent adverse effects on human health and welfare as required by the CWA's Section 404(b)(1) Guidelines. Count III alleges that the Corps failed to consider the needs and welfare of the people, in violation of the Corps' public interest review regulations at 33 C.F.R. § 320.4, by refusing to consider or address any potential human health impacts of the Permit. Finally, Count IV asserts that the Corps violated the CWA Section 404(b)(1) Guidelines by issuing a permit that will cause or contribute to violations of water

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quality standards and significant degradation of waters of the United States. Plaintiffs seek a declaration that the Corps' issuance of the Permit violated the APA, CWA, and NEPA; the vacating of the Permit; an injunction prohibiting the Corps from authorizing further discharges of fill material at the project site until the Corps complies with the CWA and NEPA; and attorneys' fees and expenses.

On November 28, 2012, the Court granted Leeco's Motion to Intervene. (DN 9.) On January 28, 2013, Plaintiffs filed their Motion for Partial Summary Judgment with respect to their human health impact claims. In response, on February 26, 2013, both Leeco (DN 33) and the Corps (DN 34) filed their own motions seeking summary judgment on the same claims. Plaintiff also filed a Motion to Consider Evidence outside the Record with respect to their CWA claims under Count IV (DN 28), which the Court denied in a June 12, 2013, Memorandum Opinion and Order. (DN 58.) Thereafter, the Court set an expedited briefing schedule for anticipated cross-motions for partial summary judgment on the remaining count of Plaintiffs' Complaint, which alleges that the Corps violated the CWA Section 404(b)(1) Guidelines by issuing a permit that will cause or contribute to violations of water quality standards and significant degradation of waters of the United States. Those cross-motions since have been filed (DN 62, 66, 69.)


I. Surface Mining Control and Reclamation Act

The Surface Mining Control and Reclamation Act (" SMCRA" ) was enacted to establish " a nationwide program to protect society and the environment from the adverse effects of surface coal mining." 30 U.S.C. § 1202(a). Although Congress acted to protect the environment, it also recognized coal's utility as " an essential source of energy" and sought to balance those dual interests. Id. § 1202(f). SMCRA " utilizes a 'cooperative federalism' approach, allocating responsibility for the regulation of surface coal mining among both state and federal agencies." Bragg v. W.Va. Coal Ass'n, 248 F.3d 275, 288 (4th Cir. 2001). Where a state's regulatory program has been approved by the Secretary of the Interior as satisfying the Act's minimum requirements, the state has " exclusive jurisdiction over the regulation of surface coal mining and reclamation operations" on non-Federal lands. 30 U.S.C. § 1253(a). Thus, any party who engages in surface coal mining must obtain and comply with a permit issued by the state's regulatory authority. [2] Id. § 1256(a). In Kentucky, the federally approved regulatory authority is the Department of Natural Resources, through the KDMP. See Sierra Club v. ICG Hazard, LLC, 2012 WL 4601012, *2 (E.D. Ky. Sept. 28, 2012).

" Regulation of the disposal of excess spoil material from surface coal mining operations is within SMCRA's purview." Ohio Valley Envtl. Coal. v. Aracoma Coal Co., 556 F.3d 177, 189-90 (4th Cir. 2009). SMCRA requires that all excess spoil material from surface mining operations be disposed of " in a controlled manner . . . and in such a way to assure mass stability and to prevent mass movement." 30 U.S.C. § 1265(b)(22)(A). " The Act clearly contemplates that valley

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fills will be used in the disposal process." Aracoma Coal, 556 F.3d at 190 (quoting 30 U.S.C. § 1265(b)(22)(D)).

II. Clean Water Act

Although SMCRA contemplates the use of valley fills, a SMCRA permit alone is insufficient to allow a mine operator to construct a valley fill; mining companies must also obtain certain permits under the CWA. The CWA establishes a comprehensive program " to restore and maintain the chemical, physical, and biological integrity of the Nation's waters." 33 U.S.C. § 1251(a). To achieve this goal, the CWA prohibits the discharge of any " pollutant" into " navigable waters" of the United States without a permit. See 33 U.S.C. § § 1311(a) and 1344(a).

The CWA authorizes the discharge of pollutants into U.S. waters through two permit programs. First, a mine operator must obtain a National Pollutant Discharge Elimination System (" NPDES" ) permit under CWA § 402, which authorizes discharges of pollutants from a point source within the mining operation, such as a sediment pond, into navigable waters. Id. § § 1342; 1362(12). Second, and more importantly for the purposes of this litigation, to dispose of excess spoil in jurisdictional waters, a surface mining company must obtain a CWA § 404 permit from the Corps. [3] Section 404 permits allow " the discharge of dredged or fill material into the navigable waters at specified disposal sites." Id. § 1344(a).

In issuing § 404 permits, the Corps must comply with the § 404(b)(1) Guidelines (" Guidelines" ), which are promulgated by the EPA pursuant to 33 U.S.C. § 1344(b)(1), and incorporated by the Corps into its own regulations. See 40 C.F.R. pt. 230 and 33 C.F.R. § 320.2(f). The Guidelines provide that the Corps may not permit discharges that " will cause or contribute to significant degradation of the waters of the United States." 40 C.F.R. § 230.10(c). Under the Guidelines, a discharge contributes to significant degradation if it has " [s]ignificantly adverse effects" on human health or welfare; life stages of aquatic life and other wildlife dependent on aquatic ecosystems; aquatic ecosystem diversity, productivity, and stability; or recreational, aesthetic, and economic values. Id.

In addition to complying with the § 404(b)(1) Guidelines, the Corps must also conduct a public interest review, balancing the " benefits which reasonably may be expected to accrue from the proposal" against " its reasonably foreseeable detriments." 33 C.F.R. § 320.4(a)(1). Part of this public interest review incorporates consideration of the general " needs and welfare of the people." Id. Where a permit complies with the Guidelines and meets other applicable criteria, the Corps will grant a permit " unless the district engineer determines that it would be contrary to the public interest." Id.

On March 31, 2008, the EPA and the Corps issued revised regulations governing compensatory mitigation for authorized impacts to wetlands, streams, and other waters of the United States under CWA Section 404, 33 U.S.C. § 1344 (" 2008 Mitigation Regulations" ). These regulations are designed to improve the effectiveness of compensatory mitigation to replace lost aquatic resources functions and area, expand public participation in compensatory decision making, and increase the efficiency and predictability of the mitigation project

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review process. 33 C.F.R. Pt. 332; 40 C.F.R. § § 230.91-98. These regulations apply to applications received after April 10, 2008. 73 Fed. Reg. 19594. (Apr. 10, 2008) (" This final rule will apply to permit applications received after the effective date of this rule . . . ." ).

III. National Environmental Policy Act

In addition to compliance with the CWA, NEPA places additional requirements on the Corps when considering a § 404 permit application. Congress enacted NEPA to " promote efforts which will prevent or eliminate damage to the environment and biosphere and stimulate the health and welfare of man." 42 U.S.C. § 4321. NEPA achieves this purpose " through a set of 'actionforcing' procedures that require that agencies take a 'hard look' at environmental consequences" when contemplating agency action. Robertson v. Methow Valley Citizens Council, 490 U.S. 332, 350, 109 S.Ct. 1835, 104 L.Ed.2d 351 (1989). NEPA is a procedural statute, not a substantive one. Id. (citations omitted) (" Although [NEPA] procedures are almost certain to affect the agency's substantive decision, it is now well settled that NEPA itself does not mandate particular results, but simply prescribes the necessary process." ). Thus, agency action that produces adverse environmental effects may still be NEPA-compliant so long as the agency considered the adverse effects and determined that competing policy values outweigh those costs. Id.

NEPA requires that federal agencies prepare a " detailed statement," known as an Environmental Impact Statement (" EIS" ), for " major Federal actions significantly affecting the quality of the human environment." 42 U.S.C. § 4332(2)(C). Whether an action's effects are significant is determined by evaluating both the context of the action and the intensity, or severity, of the impact. 40 C.F.R. § 1508.27. " When, as in this case, the agency determines that it is not clear whether the license application requires an environmental impact statement, the regulations direct the agency preliminarily to prepare an environmental assessment," or EA. Save Our Cumberland Mountains v. Kempthorne, 453 F.3d 334, 339 (6th Cir. 2006) (internal quotation marks omitted) (citing 40 C.F.R. ยง 1501.4(b)). Based on the EA, the agency either determines an EIS is required or, as the Corps did here, " instead may issue a finding of no significant impact [(" FONSI" )]--a document by a Federal agency briefly presenting the reasons why an action . . . will not have a significant effect ...

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