On October 27, 2021, the Biden administration proposed two new rules to roll back its predecessor’s regulatory clarifications involving habitat under the Endangered Species Act (ESA). Under the first proposal, the United States Fish and Wildlife Service (FWS) plans to rescind the Trump administration’s 2018 rule that clarified the process for designating critical habitat for threatened and endangered species under Section 4 of the ESA. Under the second proposal, FWS and the National Marine Fisheries Service (NMFS) plan to rescind the Trump administration’s 2020 regulatory definition of “habitat,” which the Services promulgated to increase consistency in their critical habitat designations. Stakeholders have until November 26, 2021, to submit comments on the proposals.

Critical Habitat Designation

The Trump administration critical habitat rule has been widely supported by the regulated community because it provides much needed regulatory clarity on how FWS designates critical habitat for threatened and endangered species. The rule establishes a process for FWS to consider the impacts of designating critical habitat, allowing the agency to exclude particular areas from the designation in certain circumstances. In particular, FWS must consider the economic and national security impacts of designating areas as critical habitat, and the Service may exclude areas if the benefits of exclusion outweigh the benefits of inclusion. Under the Trump administration’s rule, FWS must conduct this analysis whenever a party presents “credible information” regarding meaningful economic or other relevant impacts supporting excluding an area from a critical habitat designation.

FWS now has found the rule “potentially limits” its role by “potentially giv[ing]” weight to outside parties in excluding areas from a critical habitat designation. Despite FWS retaining the authority to make an exclusion based on the best scientific data available, the agency concluded that the outside information could interfere with its authority. In addition, the Service believes the phrase “credible information” is too vague and could “potentially result[]” in inefficiencies and wasting of FWS resources.

In light of these concerns, FWS is proposing to eliminate the Trump-era exclusion analysis provisions from the Service’s regulations for future critical habitat designations.

Definition of “Habitat”

On December 16, 2020, FWS and NMFS published a final rule adding a much needed regulatory definition for the term “habitat”: “[f]or the purposes of designating critical habitat only, habitat is the abiotic and biotic setting that currently or periodically contains the resources and conditions necessary to support one or more life processes of a species.” FWS adopted the definition in response to the U.S. Supreme Court’s 2018 decision in Weyerhaeuser Co. v. USFWS, which held that an area first must be habitat for a species before it can be eligible for inclusion in a critical habitat designation.

Notwithstanding the Supreme Court’s unanimous ruling, the agencies now believe their definition “inappropriately contrain[s]” their ability to designate critical habitat under the ESA. Of particular note, FWS has signaled a renewed desire to include areas that do not contain the requisite resources and conditions to support a listed species, but could do so in the future after restoration activities or other changes occur. By altogether rescinding the Trump-era “habitat” definition, the agencies once again will be without regulatory guardrails preventing them from designating areas as critical habitat that do not support any life processes of a listed species.

Going Forward

On October 27, 2021, FWS opened a 30-day public comment period that will end on November 26, 2021. Through this rulemaking, FWS will decide whether to remove the Trump administration’s regulatory clarifications. Absent a clear demonstration of legal vulnerability in proceeding, it is a virtual certainty both rules will be rescinded.

We also expect in the near future a similar proposal to rescind portions of the Trump-era Section 4 regulations lifting the blanket 4(d) rule on newly listed threatened species and aspects of the Section 7 consultation regulations, both of which were hard fought victories of the regulated community.

These are developing issues with potentially significant future implications. The importance of defining habitat and designating critical habitat is further heightened with potential ESA listings of pollinator and other species with extremely broad geographic ranges. We will continue to provide any updates of note as they occur.

Beveridge & Diamond’s Infrastructure and Project Development and Permitting practice group helps clients in numerous industries achieve compliance with the ever-changing regulatory landscape thereby reducing cost and risk to operations. Beveridge & Diamond’s Endangered Species and Wildlife Protection practice group provides strategic counseling and compliance advice to project proponents in all industries to minimize the impacts of threatened and endangered species listings and critical habitat designations on our clients’ activities. For more information on this development, please contact the authors.