The opinion of the court was delivered by: ROBERTSON
1. USFS interpretation of its own regulations
Plaintiffs' first argument is that the USFS interpretation of its own regulations is unreasonable.
This argument can succeed only if "the agency's interpretation . . . is plainly erroneous or inconsistent with the regulation." Thomas Jefferson University v. Shalala, 512 U.S. 504, 512, 129 L. Ed. 2d 405, 114 S. Ct. 2381 (1994) (internal quotations and citations omitted). Moreover, to set aside an agency action under the APA, a reviewing court must find that the action is "arbitrary, capricious, an abuse of discretion, or otherwise not in accordance with law." 5 U.S.C. § 706(2)(A). Given the requirements for substantial deference, I cannot set aside the USFS interpretation of the regulation in this case.
The regulation at issue, 36 C.F.R. § 228.102, was promulgated by USFS in 1990 to clarify the roles of the several federal agencies involved in the oil and gas leasing process.
The parties' disagreement arises out of subsection (e) of the regulation, which reads:
(e) Leasing decisions for specific lands. At such time as specific lands are being considered for leasing, the Regional Forester shall review the area or Forest-wide leasing decision and shall authorize the Bureau of Land Management to offer specific lands for lease subject to:
(1) Verifying that oil and gas leasing of the specific lands has been adequately addressed in a NEPA document, and is consistent with the Forest land and resource management plan. If NEPA has not been adequately addressed, or if there is significant new information or circumstances as defined by 40 CFR 1502.9 requiring further environmental analysis, additional environment analysis shall be done before a leasing decision for specific lands will be made. If there is inconsistency with the Forest land and resource management plan, no authorization for leasing shall be given unless the plan is amended or revised.
(2) Ensuring that conditions of surface occupancy identified in § 228.102(c)(1) are properly included as stipulations in resulting leases.
(3) Determining that operations and development could be allowed somewhere on each proposed lease, except where stipulations will prohibit all surface occupancy.
Plaintiffs argue that the USFS interpretation of this subsection, which employs an internal, non-public validation and verification process after authorizations have been issued for the leasing of specific lands, arbitrarily reads out the last two sentences of subsection (e)(1). Plaintiffs submit that those sentences unambiguously require USFS to make the three findings required by subsection (e) before authorizing the Bureau of Land Management ("BLM") to offer specific lands for lease.
2. Evaluation of the USFS procedure under NEPA
Plaintiffs' second argument is that the procedure prescribed by the regulations -- at least as interpreted by USFS -- must be disapproved because it is inconsistent with NEPA.
Where an agency action violates a controlling federal statute, that action of course must be struck down regardless of whether the agency is reasonably implementing its own regulations.
Plaintiffs' NEPA argument proceeds from the fact that the USFS authorization for 950,000 acres of the Shoshone to be leased, nearly half with conditions permitting surface occupancy, commits those lands to be leased. Plaintiffs object that there will be no opportunity for further public comment and that, when the land is later divided into parcels and leased, there will be no opportunity for public comment or appeal of the adequacy of environmental review as to any individual parcel until after a lease has been executed. They argue that such leases "irretrievably commit" specific parcels of land to oil and gas development in violation of clear precedent requiring ...