UT Law | Energy Center

Texas is entering the third year of a drought that threatens to be worse than the 1950s’ drought of record. Across the state, the reservoirs that supply our towns and support industrial and agricultural demands are at alarmingly low levels, with no relief in sight.

The Texas Legislature is poised to create a fund to help finance conservation measures and new water infrastructure, an important step toward implementing the state’s water plan and ensuring that the water needs of the state’s growing population are met. The fund is the Legislature’s response to the economic impacts of the current water shortages: impacts on agriculture, recreation, and business.

But the drought has exacted a toll on the natural environment, too, causing harm to native plants and wildlife that is difficult to quantify.  The shortage of rainfall has caused disruptions in the normal food chain, affecting everything from bats and birds to squirrels, raccoons, and white-tailed deer.

For the most part, impacts to wildlife take a back seat in the public’s mind to the ramifications for humans if the drought persists. But the interests of humans and wildlife often intersect and can sometimes collide, a point brought home by a federal court’s March 11 order to the Texas Commission on Environmental Quality to stop issuing water permits in the Guadalupe River in order to protect an endangered species on the Texas coast, the Whooping Crane.

On its face, the lawsuit appears to be yet another clash of endangered species versus humans, a Texas version of the spotted owl debate of the 1990s, or perhaps the latest example of federal impingement on Texas’s power to regulate its own natural resources. But, not surprisingly, the truth is more complicated. The reality is that the lawsuit was a last ditch effort to ensure that the Whooping Crane and the beautiful, resilient, finely tuned coastal ecosystem on which it depends can survive over the long run, even as the state grapples with the difficulty of meeting humans’ water needs during times of drought. The remedy ordered by the judge – that the state stop issuing permits to water users until it formulates a plan to protect the bird – is a common sense approach that should lead to a balanced state water permitting program.

The Whooping Crane is a majestic creature, the tallest crane species in North America and the rarest crane in the world. It is also an Endangered Species Act success story. In the 1940s there were fewer than 15 individual Whooping Cranes left in the world. Today, the population is estimated to be more than 500, with the world’s only self-sustaining wild population wintering in south Texas in and around Aransas National Wildlife Refuge.  The Whooping Crane feeds on wolf berries and blue crabs, both of which suffer when San Antonio Bay becomes too salty, the result of inadequate freshwater flows into the bay.  In 2009, scientists from the U.S. Fish and Wildlife Service, which manages the Refuge, noticed that Whooping Cranes were dying and appeared to be malnourished. They concluded that the birds’ food sources were literally drying up and that the only way to ensure their long term survival was to get more fresh water into the bay.

The Aransas Project, or “TAP,” was formed by conservationists, business owners, and landowners concerned about the Whooping Crane and determined to convince TCEQ to allow more water to flow down the Guadalupe River and reach the bay.  They applied for a water permit with the intention of keeping the water they were allocated in the river, rather than pumping or diverting it, but the agency rejected the application.  As a last resort, they brought suit under the  the federal Endangered Species Act, alleging that TCEQ was causing harm to the Whooping Crane by failing to ensure that sufficient freshwater reached the coast to maintain the crane’s food supply.

In December 2011, there was an 8-day trial during which the judge heard evidence from all the parties about all aspects of the case, including the Whooping Crane’s food requirements, the number of birds that live in Texas, and the State’s water permitting program and its ability to manage flows in the Guadalupe.  The State and intervenors Guadalupe-Blanco River Authority and the San Antonio River Authority argued that a state law passed in 2009 set up a process by which the state would determine what flows are necessary to protect the state’s rivers, which precluded the need for federal action. But the court found a gaping hole in the state’s position:  the state program on its face does not apply to existing water permits, only to new permits. Because the vast majority of water in Texas rivers and streams has been appropriated to water users already, it would be difficult, if not impossible, to secure sufficient flows to protect the Whooping Crane by relying solely on permit conditions in future permits. The court ruled in favor of the plaintiffs in the case and ordered TCEQ to devise a plan to protect the crane.

The Endangered Species Act contains a provision called an incidental take permit that authorizes otherwise lawful activities that cause harm to endangered species. To obtain a permit, a person (or state agency, as in this case) must prepare a “habitat conservation plan” to demonstrate that harm to the species will be minimized and mitigated “to the maximum extent practicable.”  In this case, the U.S. Fish and Wildlife Service has pledged to work with TCEQ to develop a plan to protect the Whooping Crane and its habitat in the course of administering the state’s water permitting program. The habitat conservation plan will fill the hole in the state’s program and provide an important safety net for the crane.  Rather than resisting all federal involvement, TCEQ should cooperate with the Fish and Wildlife Service and figure out a creative way to ensure the long-term survival of this glorious denizen of the Texas coast.

The dune sagebrush lizard is a light brown, 3-inch long reptile that lives in sand dunes that support low, shrubby shinnery oaks in Southeast New Mexico and West Texas.  The lizard’s habitat overlies a small portion of the Permian Basin, which happens to be the largest onshore oil and gas field in the United States.  For decades, the lizard’s numbers have been in decline, largely because of its sensitivity to the habitat disturbance that accompanies oil and gas development. Indeed, the Endangered Species Coalition has identified the dune sagebrush lizard as one of the top ten species in the U.S. threatened by oil and gas drilling.

The dune sagebrush lizard was identified as a “candidate species” for listing as threatened or endangered by the U.S. Fish and Wildlife Service in 2001. Nine years later, in December 2010, the Service proposed to list the lizard as “endangered,” citing declining numbers and ongoing threats to its survival due to habitat loss. The reaction from the oil and gas industry and Texas agencies like the General Land Office and the Texas Comptroller of Public Accounts was swift and dramatic.  They claimed that the listing would dramatically curtail oil and gas operations and cost hundreds of jobs and millions of dollars of revenue for the state, despite the fact that the lizard occurs on less than 2% of the Permian Basin.

In 2011, the Comptroller of Texas, Susan Combs, formed a multi-stakeholder group to put together a Texas Conservation Plan for the lizard, with the goal of convincing the Fish and Wildlife Service not to finalize the listing. The idea was that Texas landowners would voluntarily commit to a suite of conservation measures over 30 years to avoid and minimize adverse impacts to the lizard in return for an agreement from the Service that, should the species be listed in the future, no additional conservation measures would be imposed on the participating landowners. The agreement, formally called a “candidate conservation agreement with assurances,” or “CCAA,” would be similar to an agreement approved by the Service for landowners and state agencies in New Mexico in 2008. The Texas group drafted a number of management guidelines for landowners, including recommendations to use directional drilling and existing roadways and pipelines to avoid disturbing lizard habitat.

In June 2012, the Service announced that it would not list the dune sagebrush lizard as endangered after all, because of the “unprecedented commitments” to voluntary conservation made by landowners in Texas and New Mexico. The Service said that the threats to the species were no longer as significant as they were believed to be in 2010, citing the fact that over 60% of Texas landowners in the species’ range had signed up to participate in the Texas Conservation Plan and over 80% of the lizard’s habitat in New Mexico would be protected.

On the surface, the decision by the Service not to list the species appears to be a win-win. The species should benefit from measures designed to minimize habitat disturbance and private landowners benefit by avoiding the land use restrictions that accompany listing. The devil is in the details, however. It turns out that, while the CCAA approved by the Service for New Mexico contains clear protections for the lizard such as making prime state-owned habitat ineligible for oil and gas leasing, the Texas plan is much more nebulous. It contains recommendations rather than requirements and gives participating landowners significant discretion. For example, the plan “recommends” that construction and maintenance take place between October and March when the lizard is inactive and suggests that directional drilling be used “when practical” to avoid lizard habitat.

Even more disturbing, the specific provisions of the individual landowner agreements have never been reviewed by the Fish and Wildlife Service, because the State of Texas considers them confidential under state law. The Texas Comptroller’s office has contracted with the Texas Habitat Conservation Foundation to negotiate agreements with individual landowners that are supposed to be in conformance with the overarching CCAA, but none of the agreements have been provided to the Service. Without reviewing the agreements, it is impossible for the Service to assess their adequacy and to monitor the implementation of the CCAA.  Defenders of Wildlife, a national nonprofit conservation organization, released a white paper last week that is highly critical of the Texas Conservation Plan because of these deficiencies.

Voluntary, incentive-based programs to protect endangered species on private land are essential components of the Fish and Wildlife Service’s policy cache.  In Texas, more than 95% of the land is privately-owned and private property rights are cherished by landowners. The goal of  CCAAs – to encourage private property owners to conserve rare species before they need to be listed as endangered – is laudable. Under the umbrella of a CCAA, a landowner can agree to conservation techniques that are compatible with her land uses and beneficial for the covered species. For the program to be credible to the general public, however, the individual agreements with landowners must be based on sound science and available for review by outside experts. The fact that neither the Fish and Wildlife Service nor the general public has access to the Texas agreements threatens to undermine the public’s trust in the program as a whole.

The Service has announced that it will decide whether to list 250 additional candidate species by 2017. Among them are high profile candidates like the lesser prairie chicken, the listing of which would have major impacts on the energy industry in the Great Plains and the West. The pressure is on to find voluntary solutions like the CCAAs for the dune sagebrush lizard that would soften the regulatory blow.  As the Service works with the affected states and groups on alternatives to listing, it is critical that the integrity of the process be protected.  Shielding the individual agreements from the public’s review, as the Texas confidentiality law does, may please property owners, but it will erode the program’s credibility.

On December 28, 1973, President Richard M. Nixon signed the Endangered Species Act into law. Nixon, whose veto of the Clean Water Act had been overridden by Congress a year earlier, said in his signing statement, “Nothing is more priceless and more worthy of preservation than the rich array of animal life with which our country has been blessed. It is a many-faceted treasure, of value to scholars, scientists, and nature lovers alike, and it forms a vital part of the heritage we all share as Americans.” His words echoed Congress’s findings in Section 1 of the ESA that “these species of fish, wildlife and plants are of esthetic, ecological, education, historical, recreational, and scientific value to the Nation and its people.”  Both statements reflected the American public’s strong support for the law that was intended to reverse a decades-long trend of species extinctions. The law had passed the Senate on a voice vote and the House by a vote of 355 – 4.

The ESA is arguably the most powerful environmental law on the books. Over 1,400 animals and plants have been placed on the official threatened and endangered species list by the federal government, a step that triggers the law’s protection. Once listed, activities that would cause the “take” of the species are prohibited, unless authorized by the U.S. Fish and Wildlife Service or NOAA-Fisheries Service.  Take is defined very broadly in the ESA and its implementing regulations as any action that causes harm to an endangered species or its habitat.  Otherwise legal activities ranging from dam construction to housing developments that would go so far as to jeopardize the continued existence of a listed species are prohibited by the ESA.  The act is designed to bring rare species and the ecosystems upon which they depend back from the brink of extinction and promote their full recovery.

Today, almost 40 years after its original passage, the ESA continues to enjoy strong bipartisan support from the public. More than 80% of Americans polled in 2011 expressed support for the law, and more than 90% said it was an important safety net to prevent extinctions.  But despite the overwhelming public sentiment in favor of the ESA, its implementation has been controversial.

The ESA has been used by environmentalists in many parts of the country to slow down (and very occasionally stop) an array of development projects, including dams, subdivisions, wind farms and pipelines.  The mitigation requirements imposed on projects that could affect endangered species can be expensive and time-consuming to put in place. In some places, enforcement of the act by the federal agencies has run headlong into the prior appropriation doctrine, the common law by which the western states regulate the use of surface water by farmers, cities, and industry. The result has been a series of high profile controversies, such as a debate about usage of the Klamath River in Oregon and California, that can rage for years and lead to major changes in the water management framework. Critics claim that the law puts the needs of endangered species ahead of humans, and that it simply costs too much.

Despite the controversy, there is a growing consensus among policy makers, environmentalists, and the regulated community that the law has achieved a great deal over the last four decades. The U.S. Fish and Wildlife Service is celebrating the 40^th anniversary of the ESA this year and touting the law’s important success stories. Though only a small number of listed species have fully recovered, the act has successfully prevented the extinction of hundreds of plants and animals. According to a study published by the Center for Biological Diversity, 93% of listed species are stable or recovering due to the law’s protections. The bald eagle, gray wolf, peregrine falcon, American crocodile, and many others have recovered to the point that they have been down-listed or delisted.

The ESA’s achievements are important and the act’s champions take justifiable pride in the progress that many listed species have made toward recovery. The act is flawed in several fundamental respects, however, and as a result the law has not lived up to the lofty goals articulated by President Nixon and Congress when the law was enacted. One of the most glaring problems with the ESA is its lack of incentives for private landowners to protect endangered species.

More than half of the listed species in the United States occur entirely on private land. In states like Texas with little public land, virtually all listed species occur on private land.  The ESA prohibits the take of listed species regardless of where they are found, which means that private landowners with endangered species on their property can be prosecuted if they clear timber, mow prairie grass, or dam a creek without approval from the federal government. The penalties for violating the ESA are stiff:  up to $25,000 – $50,000 fine per violation and possible criminal penalties. Private landowners have no incentive to conserve rare species on their property by enhancing or expanding their habitats. To the contrary, they have every incentive to prevent endangered species from inhabiting their land in the first place, or from expanding if they are already present, because their presence is likely to lead to restrictions on what they can legally do with their property.

During the Clinton Administration, Interior Secretary Bruce Babbitt promulgated several policies designed to address the ESA’s disincentives for private landowners. The safe harbor policy and regulations that set up “candidate conservation agreements with assurances” were designed to remove the ESA’s disincentives by giving private landowners flexibility with respect to managing their land in return for commitments to enhance the quality of the habitat they owned. The Clinton Administration also issued a policy designed to promote conservation banking, a mechanism by which private landowners can actually profit from creating and maintaining habitat for endangered species. Today, some 2 million acres of private land are being managed under safe harbor agreements and more than 40 conservation banks in 10 states are up and running.

Those are impressive numbers, but a huge amount of work remains to be done. To date, the Obama Administration has failed to put forth any new initiatives to encourage habitat conservation on private lands, and has dragged its feet on approving conservation banks and safe harbor agreements. During the depths of the Great Recession, construction projects were stopped or slowed in many parts of the country, giving rare species on private land a temporary respite from habitat destruction. With the resurgence of economic activity and housing starts, however, pressure on sensitive habitats is certain to increase. It imperative that the Administration use the tools available and expand the list of possible incentives to encourage conservation of habitat on private land. Doing so will ensure that the ESA continues to rack up success stories for another 40 years.

As Congress considers whether to extend the production tax credit for wind energy in the context of “fiscal cliff” negotiations, environmentalists are lobbying vigorously, arguing that the PTC creates green jobs and supports strong communities.  A casual observer might conclude that enviros are always in favor of wind development, because wind produces electricity with no air pollution and does not contribute to global warming. The real story is more complicated, though. The reality is that decisions about where wind farms should be sited have often proven contentious, pitting environmentalists against state and local governments and the wind industry in particular locations.

Wind turbines produce no greenhouse gases, but they can cause significant harm to migratory birds, bats, and certain endangered species.  The harm is caused when the birds and bats fly into spinning blades, or when the construction of roads and turbines disturb nesting and roosting habitat on the ground.  In Altamont Pass, California, one of the largest wind farms in the United States has caused the death of thousands of hawks, golden eagles, and other raptors. In the Appalachian Mountains, wind turbines have killed thousands of bats, some of which are rare or endangered species.  Compared to other sources of bat and bird mortality – hunting, flying into buildings, and even cats, for example – the wind turbines are relatively benign. Scientists estimate that wind power may cause the death of as many as 2 million birds/year, whereas buildings may kill some 900 million/year. Nevertheless, especially for endangered species, wind turbines are considered to be a significant problem, a “stressor” for the species that should be mitigated.

The federal Endangered Species Act (ESA) prohibits any person from “taking” an endangered species. The statute defines “take” broadly as “to harass, harm, pursue, hunt, shoot, wound, kill, trap, capture, or collect, or to attempt to engage in such conduct.” “Harm” includes modification or degradation of habitat that results in death or injury to an endangered species.  The take prohibition is absolute, unless the person who caused the take has obtained a permit from the U.S. Fish and Wildlife Service (USFWS).  Violators are potentially subject to civil and criminal penalties. In 2009, the power of the prohibition on take was made clear in a case called Animal Welfare Institute v. Beech Ridge Energy, LLC, in which the federal district court in Maryland enjoined construction of a wind farm pending issuance of a permit from the Service, because of impacts to the endangered Indiana bat. The court based its holding on evidence that construction and operation of the wind farm was likely to harm the Indiana bat.

There have been several citizen suits filed challenging wind farms under the ESA.  In addition to the Beech Ridge case, the Sierra Club and other organizations filed suit in February 2012 against USFWS and the Bureau of Land Management challenging a “no effect” finding with respect to endangered species, which was issued in association with construction of an access road across BLM land to the North Sky River wind project in California.  In May 2012, environmentalists filed a challenge to the Echanis wind project in Southeast Oregon. In addition, there has been litigation over the Altamont Pass Wind Project.

Even organizations that strongly support wind power stress the importance of proper siting of wind farms, in order to minimize impacts on wildlife.  The American Bird Conservancy, for example, has announced a campaign to achieve a mandatory permitting system for wind farms, in order to reduce their impact on migratory birds. On June 26, 2012 American Bird Conservancy (ABC) filed suit in the federal district court for the District of Columbia to compel USFWS to produce monitoring data related to a number of wind farms across the country, which ABC had requested pursuant to the federal Freedom of Information Act.

A coalition of wind companies is working on two large-scale, multi-state habitat conservation plans to protect birds and bats from mortality and mitigate unavoidable harm through habitat protection and offsets. If approved by the USFWS, the plans will be a practical means of avoiding liability under the ESA and ensuring the long-term conservation of the rare species. These landscape scale plans are a practical solution to conservation that will work for the wind industry and the environmental community, and that should settle any question about whether wind energy is truly “green.”

On May 2, 1996 in Austin, Texas, Nancy Kaufman, the regional director of the U.S. Fish and Wildlife Service, signed the permit that created the first urban habitat conservation plan in the United States.  The Balcones Canyonlands Conservation Plan (BCCP) was the product of a decade of negotiations among environmentalists, biologists, developers, business interests, and government officials. They haggled over the amount of land to be protected, mechanisms for funding land acquisition, and the public’s right to access the land that would be set aside.  On May 2, environmental protesters gathered outside the gate to the ranch where the permit signing ceremony was held, opposed to the “sell out to developers” that they were convinced the BCCP represented. In the end, the plan was a compromise – not as much land would be protected as the environmental community argued was necessary to protect the species, but developers would contribute funding to help pay for it.  After she signed the permit, Kaufman held it up and said, “It looks like it’s made out of paper, but it’s really made out of blood, sweat, and tears.”

Sixteen years after the BCCP was established, it’s clear that the compromises were worth it and the plan’s naysayers were wrong.  The plan has been an impressive success.  More than 30,400 acres have been permanently set aside and the preserve sits like an emerald in a landscape setting dominated by suburban development. Thousands of school children visit the preserve every year, researchers study the rare species that occupy it, and Austin residents and visitors hike in a wilderness located only a few miles from downtown.

The plan called for protection of at least 30,428 acres of prime habitat for two songbirds and six invertebrate species that had been listed by the federal government as “endangered.” The preserve was to be established in some of the most desirable real estate in Texas: rolling, oak-covered hills atop which one had an unobstructed view of the Texas Hill Country.  In return for conserving the preserve land, the City of Austin and Travis County would receive permission from the federal government to allow land clearing and development to take place in other areas where the endangered species would be impacted, thereby truncating what had been a lengthy and expensive permitting process for developers. Until the BCCP, developers were required to obtain endangered species permits from the U.S. Fish and Wildlife Service directly, a process that could take a year or more. A link to the Travis County website that describes the BCCP compliance process is here.

Acquisition of the preserve land has been a slow, painstaking process. City of Austin voters approved a $22 million bond in 1992 to buy land, but Travis County voters rejected a $48 million bond proposal a year later, leaving the county with no source of funding for the land acquisition it was obligated to complete under the permit terms.  In the early days of the plan, the “participation certificates” that developers were supposed to buy prior to building in the permit area sold slowly, with the result that only limited funds were available for land purchases. Undeterred, Travis County officials applied for and received over $80 million of federal grant funds over a ten year period and set up a tax increment financing structure in the western part of the county to provide monies for land acquisition and preserve management.

Earlier this year, Travis County acquired a parcel of land for the preserve that pushed the total number of acres to 30,444, more than the BCCP permit required. The milestone passed quietly, with no public celebration, no national dignitaries in town to mark the event.  County officials point out that work remains to be done – several extraordinary caves that were identified in the plan have not yet been acquired, for example – but the achievement is remarkable nonetheless. In one of the fastest growing cities in the United States, located in a state known for its devotion to private property rights and opposition to land use controls, a diverse range of interests was able to forge an agreement to protect the region’s natural heritage. The result is a testament to the power of collaboration and the importance of a long-term vision.  In an interview given to Smart Money magazine in 1996, former Interior Secretary Bruce Babbitt said about the BCCP, “Give the plan 20 years and it will prove to be a monumental success story.”  It’s been sixteen years; he was right.

Photo from Travis County BCCP page:

Photo from Balcones Canyonlands National Wildlife Refuge Homepage: (golden-cheeked warbler):