United States District Court, District of Columbia
CHRISTOPHER R. COOPER United States District Judge.
Florida counties have challenged a 2014 decision by the
United States Department of Transportation ("DOT")
to allocate up to $1.75 billion in non-taxable private
activity bonds,, or "PABs, " to help finance a
railroad project along the state's eastern coastline.
DOT, the counties allege, failed to comply with the
requirements of the National Environmental Policy Act
("NEPA") and other environmental statutes before
allocating the PABs. After this Court held that the counties
had standing and had stated claims under these statutes, the
project's sponsor- AAF Holdings, Inc.
("AAF")-applied for a new allocation of PABs to
finance a portion of the project that does not affect the
counties, and requested that DOT withdraw the previously
challenged allocation. DOT did so. Defendants now move to
dismiss these cases as moot. For the reasons that follow, the
Court will grant the motions.
history of this railroad project and the litigation it
sparked are discussed extensively in prior opinions by the
Court. See Indian River Cry, v. Rogoff. 201
F.Supp.3d 1, 4 (D.D.C. 2016) (granting in part and denying in
part Defendants' initial motions to dismiss); Indian
River Cty. v. Rogoff. 110 F.Supp.3d 59, 63-66 (D.D.C.
2015) (denying the counties' motions for a preliminary
injunction). What follows is a brief overview of the most
relevant facts that bear on Defendants' present motions
seeks to construct and operate an express railway between
Miami and Orlando. The project is divided into two phases. In
Phase I, which received private funding and is nearing
completion, AAF intends to provide rail service between Miami
and West Palm Beach. The Federal Railroad Administration
("FRA"), an arm of DOT, led a study of the
potential environmental harms of Phase I, which resulted in a
Finding of No Significant Impact. In Phase II, AAF aims to
extend the rail line north from West Palm Beach to Cocoa, and
then inland to Orlando. Phase II of the project runs through
Indian River and Martin Counties, which are located along the
east coast of Florida just north of Palm Beach County.
Phase II, AAF applied for a SI .6 billion loan through the
Railroad Rehabilitation and Improvement Financing program
("RR1F"). RRIF is administered by the FRA, and the
loans it provides are expressly subject to NEPA requirements.
See 49 C.F.R. § 260.5. Under NEPA, a federal agency is
required to prepare an Environmental Impact Statement
("EIS") and a Record of Decision before taking
"major Federal action[ ] significantly affecting the
quality of the human environment." 42 U.S.C. §
4332(2)(C). FRA issued a final EIS in August 2015 but has not
issued a Record of Decision or a decision on AAF's loan
its application for a RRIF loan was pending, AAF also
requested that DOT exempt from federal taxes $1.75 billion in
PABs to finance the remainder of the project, spread over
both phases. PABs are bonds issued by state or local
government agencies to finance projects of public utility, By
statute, DOT may designate up to $1.5 billion in PABs as
tax-exempt nationwide in order to encourage private
development of transportation projects. See 42 U.S.C. §
142(m). DOT provisionally authorized the requested $1.75
billion PAB allocation in December 2014. Indian River
Cty.. 201 F.Supp.3d at 6 (citing Reininger Decl. Ex. F,
Letter from Peter M. Rogoff, Under Secretary of
Transportation, to AAF President Michael Reininger).
River County and Martin County filed separate suits against
DOT, alleging it improperly authorized the PAB allocation
prior to the completion of FRA's then-ongoing NEPA review
for Phase II. See Amend. Compl., Indian River Cty, v. Rogoff,
15-cv-460 (D.D.C. May 4, 2015); Compl., Martin Cty. v.
Dep't of Transp.. 15-cv-632 (D.D.C. Apr. 27, 2015).
The counties also allege that DOT violated Section 106 of the
National Historic Preservation Act ("NHPA") and
Section 4(f) of the Department of Transportation Act
("DOTA"), both of which set forth additional
requirements for projects that are subject to federal control
or approval. See Compl., Indian River Cty.,
15-cv-460, ¶ 6. The counties seek declaratory relief
finding the 2014 allocation to be unlawful, as well as
injunctive relief vacating the 2014 allocation and blocking
DOT from issuing any additional PABs to fund Phase II without
first complying with the relevant environmental statutes.
Id. at 44-45. While the cases have not been joined,
the parties noticed them as related and they have proceeded
on parallel tracks. AAF subsequently intervened as a
defendant in both cases. The Court denied Plaintiffs'
motions for a preliminary injunction in May 2015.
August 2016, the Court denied Defendants' motions to
dismiss Plaintiffs' NEPA, NHPA, and DOTA claims. In doing
so, it held that DOT's PAB allocation for the AAF project
qualified as major federal action, thus triggering the
requirements of NEPA, NHPA, and DOTA. See Indian River
Cty.. 201 F.Supp.3d at 20. Several months later, the
counties moved for summary judgment, The Court stayed summary
judgment briefing, however, after Defendants informed the
Court that AAF had asked DOT to withdraw the 2014 PAB
allocation and replace it with a new, smaller allocation that
would only be used to fund Phase I. See DOT's Mem. Supp.
Mot. to Dismiss ("DOT's MTD"). On November 22,
2016, DOT withdrew the 2014 allocation and granted AAF a new
PAB allocation of $600 million. A week later, Defendants
moved to dismiss, arguing that both cases are now moot.
Motions to Dismiss under Rule 12(b)(1)
may move under Federal Rule of Civil Procedure 12(b)(1) to
dismiss an action for lack of subject-matter jurisdiction.
Fed.R.Civ.P. 12(b)(1). Like a motion to dismiss for failure
to state a claim under Federal Rule of Civil Procedure
12(b)(6), the Court must "treat the complaint's
factual allegations as true and afford the plaintiff the
benefit of all inferences that can be derived from the facts
alleged." Jeong Seon Han v. Lynch. 2016 WL
7209628, *4 (D.D.C. Dec. 12, 2016) (internal quotation marks
omitted). But because the Court has an "affirmative
obligation to ensure that it is acting within the scope of
its jurisdictional authority, " Grand Lodge of
Fraternal Order of Policy v. Ashcroft, 185 F.Supp.2d 9,
13 (D.D.C. 2001), the "[p]laintiff[s'] factual
allegations in the complaint. . . will bear closer scrutiny
in resolving a 12(b)(1) motion than in resolving a 12(b)(6)
motion, " Delta Air Lines, Inc. v. Export-Import
Bank of United States. 85 F.Supp.3d 250, 259 (D.D.C.
2015) (quoting 5A Charles A. Wright & Arthur R. Miller,
Federal Practice and Procedure § 1350 (2d ed. 1987)).
Moreover, "unlike with a motion to dismiss under Rule
12(b)(6), the Court 'may consider materials outside the
pleadings in deciding whether to grant a motion to dismiss
for lack of jurisdiction.'" Delta Air
Lines. 85 F.Supp.3d at 259 (quoting Jerome Stevens
Pharms., Inc. v. FDA, 402 F.3d 1249, 1253-1254 (D.C.
motion to dismiss for mootness is properly brought under Rule
12(b)(1) because mootness itself deprives the court of
jurisdiction. See DL v. District of Columbia. 187
F.Supp.3d 1, 5 (D.D.C. 2016) (internal citations omitted).
Federal courts lack jurisdiction to decide moot cases
"because their constitutional authority extends only to
actual cases or controversies." Conservation Force.
Inc. v. Jewell. 733 F.3d 1200, 1204 (D.C. Cir. 2013)
(quoting Iron Arrow Honor Soc'v v. Heckler. 464
U.S. 67, 70 (1983)); see also Worth v. Jackson, 451
F.3d 854, 855 (D.C. Cir. 2006) ("Three inter-related
judicial doctrines-standing, mootness, and ...