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National Association of Home Builders v. United States Environmental Protection Agency

United States District Court, District Circuit

July 26, 2013




The National Association of Home Builders and its member associations, Southern Arizona Home Builders Association ("SAHBA") and Home Builders Association of Central Arizona ("HBACA") (collectively "NAHB"), have filed suit on behalf of themselves and their members, seeking judicial review under the Administrative Procedure Act ("APA"), 5 U.S.C. §§ 701 et seq., of a determination by the U.S. Environmental Protection Agency ("EPA") and the U.S. Army Corps of Engineers ("Corps") that portions of the Santa Cruz River are traditional navigable waters ("TNWs") under the Clean Water Act ("CWA"), 33 U.S.C. §§ 1251 et seq. Defendants move to dismiss for lack of subject matter jurisdiction or, in the alternative, for failure to state a claim. For the reasons stated below, the Court will grant defendants' motion.


Plaintiffs originally brought suit on March 23, 2009, alleging that the EPA and the Corps violated the APA in determining in 2008 that two reaches of the Santa Cruz River are TNWs.[2] See Nat'l Ass'n of Home Builders v. U.S. EPA (" NAHB I "), 731 F.Supp.2d 50, 52-53 (D.D.C. 2010). The district court dismissed the complaint on the grounds that the CWA precludes "pre-enforcement review" of agency actions taken under its authority. Id. at 55. The Court wrote,

the CWA precludes judicial review of a TNW determination until the EPA or the Corps decides to bring an enforcement action against a particular party, or the Corps issues an adverse permitting decision, at which time the aggrieved party will be able to challenge the basis for asserting federal jurisdiction over waters on its property, including the TNW determination underlying the assertion of that jurisdiction.

Id. [3]

The Court of Appeals affirmed the district court's dismissal on the alternative ground that plaintiffs lacked Article III standing to challenge the TNW Determination.[4] See Nat'l Ass'n of Home Builders v. EPA (" NAHB II "), 667 F.3d 6, 10 n.5, 16 (D.C. Cir. 2011). The Court of Appeals held that NAHB had not demonstrated organizational standing "[b]ecause [it] has not asserted the alleged violation perceptibly impaired' a non-abstract interest." Id. at 12. It also held that NAHB had failed to demonstrate representational standing on behalf of its members because "it has neither sufficiently alleged nor persuasively demonstrated any threat of injury in fact to any of its members that is fairly traceable' to the TNW Determination." Id. at 13. The Court explained that the TNW Determination only established that the two reaches of the Santa Cruz River could be subject to CWA jurisdiction, not whether any other particular "watercourse" is "jurisdictional and therefore subject to the CWA's permit requirements." Id. It held,

Unless and until [an individual site-specific] jurisdictional determination applies the TNW Determination to particular property (and its watercourses) and finds a sufficient nexus - or the Agencies use the TNW Determination in an enforcement action against a party discharging without a permit - the owner or developer of the property suffers no incremental injury in fact from the TNW Determination and any challenge to it is therefore premature.

Id. The Court added "[i]n the meanwhile, [NAHB's] members face only the possibility of regulation, as they did before the TNW Determination: Any watercourse on their property may (or may not) turn out to be subject to CWA dredging permit requirements because of a nexus (or not) with the two Santa Cruz reaches." Id. (emphasis in original). The Court also indicated that "[w]ithout an additional allegation that the TNW substantially increased the risk of regulation or enforcement relating to particular property, we have no basis to conclude [that] the TNW caused a concrete and particularized' and actual or imminent' threat to any landowner, let alone any particular NAHB member." Id. at 14.

Finally, the Court held that NAHB's claim that it had "procedural standing to challenge the Agencies' failure to provide notice and an opportunity to submit comments pursuant to the APA" likewise failed because of the absence of an imminent injury-in-fact. Id. at 15. NAHB's petition for rehearing en banc was denied on March 8, 2012. See id. at 6.

NAHB has now filed a new suit, again challenging under the APA the procedural and substantive validity of the same TNW Determination at issue in NAHB I and NAHB II. ( See Complaint [ECF No. 1] ("Compl.").) Defendants have moved to dismiss on the grounds that (1) NAHB is precluded from relitigating its lack of standing; (2) NAHB still lacks organizational, representational, and procedural standing; (3) the TNW Determination is not "final agency action"; and (4) NAHB's claims are not ripe. ( See Defendants' Motion to Dismiss [ECF No. 12] ("Def. Mot.") at 2-4.) In its opposition, NAHB asserts that it has "followed the guidance provided by the Court of Appeals and tailored its Complaint and supporting declarations to the NAHB [ II ] decision." (Plaintiffs' Opposition [ECF No. 15] ("Pl. Opp.") at 27.) It notes that it has specifically sought to address the "increased risk of regulation, " "changes to the manner of regulation, " and "types of watercourses on property of members now subject to regulation" resulting from the TNW Determination, based on the Court of Appeals' analysis of the shortcomings in its 2009 filings. ( Id. ) NAHB has also filed declarations from three association members who own land within the Santa Cruz River watershed and who claim injuries resulting from the TNW Determination. ( See id. at 1; Declaration of Albert LeCocq [ECF No. 16] ("LeCocq Decl."); Declaration of Larry Kreis [ECF No. 17] ("Kreis Decl."); Declaration of Jerry DeGrazia [ECF No. 18] ("DeGrazia Decl.").)

It is important to note that none of the facts on the ground have changed between 2009 and the present date. The only difference is that in response to the motion to dismiss the 2009 case, NAHB submitted declarations from Thomas Ward, NAHB Vice President for Litigation and Legal Services, and Jessica Whyde, SAHBA President, whereas in response to the instant motion, it has submitted declarations from three NAHB and SAHBA members - Albert LeCocq, Larry Kreis, and Jerry DeGrazia - each of whom owns and seeks to develop land in proximity to the two Santa Cruz reaches.

NAHB's new litigation strategy is informed by the Court of Appeals' holding that the previous declarations "f[e]ll short of establishing certainly impending dangers for any particular member of the petitioners' associations." NAHB II, 667 F.3d at 15 (quoting Am. Chem. Council v. Dep't of Transp., 468 F.3d 810, 819 (D.C. Cir. 2006)). In particular, the Circuit Court highlighted Ward's statement, "I am personally aware of NAHB members that recently applied for and received authorization to discharge stormwater under CWA Section 402 in connection with construction activities on lands within the Santa Cruz River watershed and where the receiving water was identified as the Santa Cruz River." (Def. Mot., Ex. 2, Feb. 3, 2010 Declaration of Thomas Ward, Vice President of Litigation and Legal Services for NAHB [ECF No. 12-2] ¶ 9.) The Court found this statement inadequate because "the declarant fails to explain whether the TNW Determination motivated the landowner to seek an application for a permit or how the relief NAHB seeks - declaratory and injunctive relief - would remedy the past injuries the members may have already incurred in applying for the permits." NAHB II, 667 F.3d at 14 (emphasis in original).

The Court also highlighted Whyde's statement, "I have personal knowledge of at least one SAHBA member that owns land within the Santa Cruz River watershed and is applying for a Clean Water Act permit in connection with development activities on its land." (Def. Mot., Ex. 3, Feb. 3, 2010 Declaration of Jessica D. Whyde, President of SAHBA [ECF No. 12-3] ¶ 11.) The Court faulted that declaration for failing to explain "why the member's decision to apply is directly traceable to the TNW Determination;" for saying "nothing about the property, the watercourse affected by the landowner's project or the greater likelihood of regulation, if any, after than before the TNW Determination;" and for failing to assert "that any member plans in fact to discharge contaminants into a likely jurisdictional watercourse anytime soon." NAHB II, 667 F.3d at 15. Through the declarations from LeCocq, Kreis, and DeGrazia, NAHB now attempts to remedy the deficiencies identified by the Court of Appeals. Although the declarations fill some of the gaps, they still fail to satisfy the Court of Appeals' clear directive that standing will only be found when NAHB demonstrates that the TNW has been used as the basis for a site-specific jurisdictional determination ("JD") or enforcement action. See id. at 13.



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