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The Regents of University of California v. Federal Emergency Management Agency

United States District Court, N.D. California, San Francisco Division

December 20, 2019

THE REGENTS OF THE UNIVERSITY OF CALIFORNIA, Plaintiff,
v.
FEDERAL EMERGENCY MANAGEMENT AGENCY, et al., Defendants.

          ORDER GRANTING MOTIONS TO DISMISS CASE AS MOOT RE: ECF NOS. 120, 123-125, 127

          LAUREL BEELER, UNITED STATES MAGISTRATE JUDGE

         INTRODUCTION

         In 2005, the Regents of the University of California submitted two applications to the California Governor's Office of Emergency Services (“Cal OES”) for grant funding from the Federal Emergency Management Agency (“FEMA”) to mitigate the risk of wildfires in the East Bay Hills. The funding was for two areas: a 42.8-acre area in Claremont Canyon and a 56.3-acre area in Strawberry Canyon. The forest in those areas has an “understory”[1] of native trees and shrubs growing beneath an “overstory”[2] canopy of non-native trees, particularly eucalyptus trees, that are vulnerable to fire. The University's project would eradicate the non-native overstory by cutting down all of the non-native trees (including all eucalyptus, Monterey pine, and acacia trees) to convert the area into a forest of native California species that would be more resistant to fire.

         FEMA conducted an environmental review under the National Environmental Policy Act (“NEPA”). Among other things, FEMA consulted with the U.S. Fish and Wildlife Service. The Fish and Wildlife Service issued a Biological Opinion that the project might have short-term adverse effects on the Alameda whipsnake, which is listed as threatened under the Endangered Species Act, and would also have long-term benefits by eradicating eucalyptus trees (which are unsuitable for the whipsnake), thereby creating new habitat areas for the whipsnake. The Fish and Wildlife Service issued an “incidental-take statement” (or “incidental-take permit”) authorizing the University to engage in limited “incidental take” (meaning, harassment, injury, or death) of the whipsnake and other listed species in connection with the project.

         In 2014, FEMA issued a final Environmental Impact Statement documenting its environmental review. FEMA, in conjunction with the University, modified the project to implement a “unified methodology”: (1) for 22.1 of the 99.1 total acres at issue, the University would emphasize “thinning” the understory (by removing shrubs and low tree branches) instead of cutting down the non-native-tree overstory, and (2) for the remaining acres, the University would implement its plan to cut down non-native trees. In 2015, FEMA granted $573, 828 in funding to the University for the project.

         A non-profit organization called the Hills Conservation Network (“HCN”) filed several suits to block the project. HCN contended that the University's plan to cut down non-native trees (and spread wood chips from those trees at the project sites) would increase, not decrease, fire risk. Instead, HCN said that removing understory vegetation, not cutting down the overstory, was a better and more cost-effective way to mitigate fire risk. HCN argued that FEMA should have required that approach for the entire project area.

         HCN first sued FEMA, the director of Cal OES, and the University (among other defendants) in federal court, alleging that FEMA violated NEPA by not adequately considering HCN's alternative as part of its environmental review of the University's project. Hills Conservation Network v. FEMA, No. 3:15-cv-01057-LB (N.D. Cal. filed Mar. 6, 2015) (Federal HCN). In September 2016, FEMA and Cal OES settled the Federal HCN lawsuit, over the University's objections, by agreeing to rescind the grants for the University's project.

         HCN also sued the University in state court, alleging that the University violated the California Environmental Quality Act (“CEQA”) by not adequately conducting its own environmental review of its project. Hills Conservation Network, Inc. v. Regents of the Univ. of Cal., No. RG16823477 (Cal. Super. Ct. Alameda Cty. filed July 15, 2016) (State HCN). In October 2016, the state court enjoined the University's project on the ground that HCN had a likelihood of success on the merits of its claim that the University violated CEQA.

         In February 2017, the University rescinded its approval for its original project - which allowed it to stipulate to dismissal of the State HCN lawsuit on the ground that it was “potentially moot.” The University moved forward instead with a “Revised Project, ” funded by a $3, 621, 000 grant from the California Department of Forestry and Fire Protection (“Cal Fire”). The Revised Project involves selective thinning and understory removal throughout the area covered by the FEMA project (among other areas) and not cutting down non-native trees and removing the overstory canopy as its original project had called for. The University is pursuing a full environmental review of the Revised Project for CEQA compliance.

         In June 2017, the University filed this lawsuit against FEMA, Cal OES, and several FEMA and Cal OES officials. The University claims that FEMA's decision to terminate the grants for its original Claremont Canyon and Strawberry Canyon project (1) failed to comply with the regulations under the Robert T. Stafford Disaster Relief and Emergency Assistance Act (“Stafford Act”) and thus violated the Administrative Procedure Act (“APA”), (2) was arbitrary and capricious and thus violated the APA, and (3) failed to comply with the procedural and substantive requirements of NEPA. HCN intervened as an additional defendant. Another FEMA grant recipient (that retained grant funding) - the East Bay Regional Park District (“Park District”) - also intervened as an additional defendant.

         The parties all filed dispositive cross-motions. The University moved for summary judgment, arguing that FEMA's actions in terminating the grants for its original project violated the APA and NEPA.[3] FEMA moved to dismiss, arguing that (1) the University lacks standing because there is no causation or redressability, (2) the case is moot because the University itself rescinded its approval for the FEMA project and is now pursuing the Revised Project, and (3) its sovereign immunity bars the University's claims.[4] FEMA also cross-moved for summary judgment on the grounds that (1) it legally terminated the grants because Cal OES (the main grant recipient) consented to the termination and the University (as a subgrantee) does not need to consent and (2) it complied with the APA and NEPA when it terminated the grants.[5] HCN joined in FEMA's motions.[6] The Director of Cal OES[7] (1) moved to dismiss, arguing that the Eleventh Amendment bars the University's claims against him, and (2) cross-moved for summary judgment, arguing, like FEMA, that their mutual consent to terminate the grants was lawful.[8], [9] The Park District cross-moved for summary judgment on the ground that this case should not alter or vacate FEMA's grant funding for the Park District's project.[10]

         The court dismisses the case as moot. The University affirmatively rescinded its approval for the FEMA project to cut down the non-native-tree overstory and now is implementing a Cal Fire-funded Revised Project to thin the forest and remove understory. FEMA's grants and the related items (e.g., the incidental-take statement) were for the FEMA project and cannot be transferred to the Revised Project. Consequently, a court order finding that FEMA erred in rescinding the University's grants for the original project would not afford the University any effective relief because the University is instead pursuing the Revised Project. This mooted the State HCN lawsuit, and it moots this lawsuit too.

         STATEMENT

         1. Statutory, Regulatory, and Administrative Background

         1.1 FEMA Grant Programs

         Under the Stafford Act, FEMA administers numerous grant programs, including the Pre-Disaster Mitigation Program authorized by 42 U.S.C. § 5133 and the Hazard Mitigation Grant Program authorized by 42 U.S.C. § 5170c.

         The Pre-Disaster Mitigation Program was established “to provide technical and financial assistance to States and local governments to assist in the implementation of predisaster hazard mitigation measures that are cost-effective and are designed to reduce injuries, loss of life, and damage and destruction of property, including damage to critical services and facilities under the jurisdiction of the States or local governments.” 42 U.S.C. § 5133(b). The Hazard Mitigation Grant Program allows for federal funding when authorized under a presidential declaration that a major disaster exists. 42 U.S.C. §§ 5170, 5170c.

         According to FEMA guidance, states, territories, and federally recognized tribes (including the emergency-management agencies or similar offices of states, territories, and federally recognized tribes) are eligible to be “Applicants” to the Pre-Disaster Mitigation Program and the Hazard Mitigation Grant Program.[11] (Cal OES is the Applicant to FEMA for the state of California.[12]) Entities that are not states, territories, or federally recognized tribes cannot be Applicants, but they can submit subapplications for FEMA assistance to their Applicant state, territory, or federally recognized tribe.[13] Applicants are responsible for soliciting subapplications from eligible subapplicants and assisting in the preparation of, reviewing, and submitting eligible, complete applications to FEMA.[14]

         If FEMA awards grant funding, the Applicant then becomes both the “Recipient” of the grant funds and a “pass-through entity.” 2 C.F.R. § 200.86 (“Recipient means a non-Federal entity that receives a Federal award directly from a Federal awarding agency to carry out an activity under a Federal program. The term recipient does not include subrecipients.”); 2 C.F.R. § 200.74 (“Pass-through entity means a non-Federal entity that provides a subaward to a subrecipient to carry out part of a Federal program.”).[15] Pass-through entities are accountable for the use of the funds and are responsible for administering the grant, for complying with program requirements and all other applicable laws and regulations, and for financial management of the program and for overseeing all approved projects.[16] Subapplicants, in turn, become “Subrecipients.” 2 C.F.R. § 200.93 (“Subrecipient means a non-Federal entity that receives a subaward from a pass-through entity to carry out part of a Federal program; but does not include an individual that is a beneficiary of such program. A subrecipient may also be a recipient of other Federal awards directly from a Federal awarding agency.”).[17] Subrecipients are responsible for managing their subawards and for complying with program requirements and all other applicable laws and regulations.[18]

         Federal regulations provide that grant funding may be terminated in whole or in part “[b]y the Federal awarding agency or pass-through entity with the consent of the non-Federal entity, in which case the two parties must agree upon the termination conditions, including the effective date and, in the case of partial termination, the portion to be terminated[.]” 2 C.F.R. § 200.339(a)(3).[19]

         The Stafford Act provides that “[t]he Federal Government shall not be liable for any claim based upon the exercise or performance of or the failure to exercise or perform a discretionary function or duty on the part of a Federal agency or an employee of the Federal Government in carrying out the provisions of this chapter.” 42 U.S.C. § 5148.

         1.2 The National Environmental Policy Act

         Under NEPA, federal agencies generally are required to prepare an Environmental Impact Statement (“EIS”) for “major Federal actions significantly affecting the quality of the human environment[.]” 42 U.S.C. § 4332(c).[20] Federal agencies must rigorously explore and objectively evaluate all reasonable alternatives (including the alternative of “no action”) and devote “substantial treatment” to each alternative considered in detail. 40 C.F.R. § 1502.14. Federal agencies must prepare draft Environmental Impact Statements concurrently with and integrated with environmental-impact analyses and related surveys and studies required by other federal statutes, including the Endangered Species Act. 40 C.F.R. § 1502.25(a).

         “‘NEPA does not provide substantive protections, only procedural ones[.]'” Friends of the Santa Clara River v. U.S. Army Corps of Eng'rs, 887 F.3d 906, 913 (9th Cir. 2018) (quoting Conservation Cong. v. Finley, 774 F.3d 611, 615 (9th Cir. 2014)). “Although a court must ‘insure that the agency has taken a hard look at environmental consequences,' a court cannot ‘interject itself within the area of discretion of the executive as to the choice of the action to be taken.'” Id. (quoting Kleppe v. Sierra Club, 427 U.S. 390, 410 n.21 (1976)). As another court in this district observed, “[o]nce the agency does the required hard look, it is free to choose to proceed with action that will have an adverse impact on the environment, at least insofar as NEPA is concerned, the idea being that if we are going to destroy the environment, we should do so with ou[r] eyes wide open and not by accident.” Bair v. Cal. State Dep't of Transp., 867 F.Supp.2d 1058, 1065 (N.D. Cal. 2012).

         “‘Because NEPA does not provide for a private right of action, plaintiffs challenging an agency action based on NEPA must do so under the Administrative Procedure Act[.]'” Nuclear Info. and Res. Serv. v. Nuclear Regulatory Comm'n, 457 F.3d 941, 950 (9th Cir. 2006) (quoting Ashley Creek Phosphate Co. v. Norton, 420 F.3d 934, 939 (9th Cir. 2005)).

         1.3 The California Environmental Quality Act

         Under CEQA, public agencies within the state of California, such as the University, are required to “prepare, or cause to be prepared by contract, and certify the completion of, an environmental impact report on any project which they propose to carry out or approve that may have a significant effect on the environment.” Cal. Pub. Res. Code §§ 21100(a), 21151(a). An Environmental Impact Report (“EIR”) must describe a range of reasonable alternatives (including the alternative of “no project”), must evaluate the comparative merits of the alternatives, and must include sufficient information about each alternative to allow “meaningful evaluation, analysis, and comparison with the proposed project.” Cal. Code Regs. tit. 14, § 15126.6. Once an Environmental Impact Report has been prepared for a project, a subsequent or supplemental Environmental Impact Report is required if substantial changes are proposed to the project or the circumstances under which the project is being undertaken (or other new information arises) that will require major revisions of the Environmental Impact Report. Cal. Pub. Res. Code § 21166. If the agency decides to prepare an addendum to a previously certified Environmental Impact Report, as opposed to a subsequent Environmental Impact Report, it must provide a brief explanation of its decision not to prepare a subsequent Environmental Impact Report, supported by substantial evidence. Cal. Code Regs. tit. 14, § 15164(e).

         CEQA differs from NEPA in that while both acts impose procedural requirements of preparing environmental-impact reports, CEQA (unlike NEPA) also contains “‘a substantive mandate that public agencies refrain from approving projects for which there are feasible alternatives or mitigation measures.'” Friends of the Santa Clara River, 887 F.3d at 914 n.5 (quoting Mountain Lion Found v. Fish and Game Comm'n, 16 Cal.4th 105, 134 (1997)).

         “[C]itizens have standing to bring suits to enforce CEQA.” Town of Atherton v. Cal. HighSpeed Rail Auth., 228 Cal.App.4th 314, 340 (2014) (citing Rialto Citizens for Responsible Growth v. City of Rialto, 208 Cal.App.4th 899, 912-16 (2012)).

         1.4 The Endangered Species Act

         Section 9 of the Endangered Species Act prohibits the “take”[21] of any listed endangered species of fish or wildlife. 16 U.S.C. § 1538. “Notwithstanding that prohibition, private parties . . . may obtain authorization for ‘incidental take' of listed species in two ways: (1) through Section 7, for projects authorized, funded, or carried out by a federal agency; or (2) through Section 10, for projects carried out entirely by the private party.” Defenders of Wildlife v. U.S. Fish and Wildlife Serv., No. 16-CV-01993-LHK, 2016 WL 4382604, at *1 (N.D. Cal. Aug. 17, 2016); accord Ramsey v. Kantor, 96 F.3d 434, 439 (9th Cir. 1996).

         “Specifically, Section 7(a)(2) governs federal agency actions in which ‘there is discretionary Federal involvement or control.'” Defenders of Wildlife, 2016 WL 4382604, at *1 (citing 50 C.F.R. § 402.03). “Under Section 7, a federal agency must ‘insure that any action authorized, funded, or carried out by such agency is not likely to jeopardize the continued existence of any endangered species or threatened species or result in the destruction or adverse modification of critical habitat of such species.'” Ctr. for Biological Diversity v. Bureau of Land Mgmt., 698 F.3d 1101, 1107 (9th Cir. 2012) (internal brackets and ellipsis omitted) (quoting 16 U.S.C. § 1536(a)(2)). “Before beginning any ‘major construction activities,' agencies must prepare a ‘biological assessment' to determine whether listed species or critical habitat ‘are likely to be adversely affected' by the proposed action.” Id. (quoting 50 C.F.R. § 402.12). “If so, the action agency must formally consult with the appropriate wildlife agency” - the U.S. Fish and Wildlife Service (“FWS”) or, for marine species, the National Marine Fisheries Service - “before undertaking the action.” Id. (citing 50 C.F.R. § 402.14). “During the formal consultation process, the FWS must ‘formulate its biological opinion as to whether the action, taken together with cumulative effects, is likely to jeopardize the continued existence of listed species or result in the destruction or adverse modification of critical habitat.'” Id. (internal brackets omitted) (quoting 50 C.F.R. § 402.14(g)(4)). “If the FWS concludes that jeopardy or adverse modification is likely, then any take resulting from the proposed action is subject to section 9 liability (unless that take is authorized by other provisions of the Act not relevant here).” Id. (citing cases). “If, on the other hand, the FWS concludes in its biological opinion that no jeopardy or adverse modification is likely, but that the project is likely to result only in the ‘incidental take' of members of listed species, then the FWS will provide, along with its biological opinion, an incidental take statement authorizing such takings.” Id. (emphasis removed) (citing 50 C.F.R. § 402.14(i)). “‘Significantly, the Incidental Take Statement functions as a safe harbor provision immunizing persons from Section 9 liability and penalties for takings committed during activities that are otherwise lawful and in compliance with its terms and conditions.'” Id. at 1108 (quoting Ariz. Cattle Growers' Ass'n v. U.S. Fish and Wildlife, 273 F.3d 1229, 1239 (9th Cir. 2001)); see also Defenders of Wildlife, 2016 WL 4382604, at *2 (“In addition, where the agency's action involves authorization or approval of private party conduct, then the private party is also protected from Section 9 by compliance with the agency's incidental take statement.”).

         “The action agency must . . . reinitiate consultation if the proposed action ‘is subsequently modified in a manner that causes an effect to the listed species or critical habitat that was not considered in the biological opinion.'” Ctr. for Biological Diversity, 698 F.3d at 1108 (quoting 50 C.F.R. § 402.16(c)). “When reinitiation of consultation is required, the original biological opinion loses its validity, as does its accompanying incidental take statement, which then no longer shields the action agency from penalties for takings.” Id. (citing Allen, 476 F.3d at 1037; U.S. Fish and Wildlife Serv & Nat'l Marine Fisheries Serv., Endangered Species Consultation Handbook: Procedures for Conducting Consultation and Conference Activities under Section 7 of the Endangered Species Act 4-23 (1998)).

         “For projects that do not require authorization or funding from a federal agency, Section 10 allows a private party to seek an incidental take permit directly from FWS.” Defenders of Wildlife, 2016 WL 4382604, at *2 (citing 16 U.S.C. § 1539(a)(1)(B)). “To receive a Section 10 permit, the applicant must submit a comprehensive conservation plan that provides for mitigation efforts that minimize the project's future impact on listed species.” Id. (citing 50 C.F.R. § 17.22(b)(1)(iii)). “FWS may issue the permit only after affording the opportunity for public comment on the conservation plan.” Id. (citing 50 C.F.R. § 17.22).

         “If take is not permitted pursuant to Section 10 or a Section 7 consultation, a developer who undertakes activities that result in the take of listed species may be subject to criminal and civil federal enforcement actions, as well as civil citizen suits.” Id. (citing 16 U.S.C. § 1540).

         2. The Subgrant Applications

         FEMA ultimately approved the University's two subgrant applications to perform fire-mitigation work in Claremont Canyon and Strawberry Canyon and also approved two other subgrant applications: one by the City of Oakland and one by the East Bay Regional Park District. The four subgrant applications are as follows.

         2.1 The University's Subgrant Applications

         The University owns approximately 800 acres of land in the East Bay Hills, known as the “Hill Campus.”[22] Cal Fire has prepared fire-hazard-severity mapping that indicates that most of the undeveloped areas in the East Bay Hills are in the “very high fire hazard severity zone, ” which is the zone where wildfire hazards are most severe.[23] Between 1923 and 1992, fifteen major wildfires occurred in the East Bay Hills, including the 1991 Tunnel Fire, which killed 25 people, destroyed more than 3, 000 homes, and caused an estimated $1.5 billion in damage.[24]

         In February 2005, the University submitted two subgrant applications to Cal OES for Pre-Disaster Mitigation grant funding: one for Claremont Canyon[25] and one for Strawberry Canyon.[26] The University set forth its scope of work in its applications:

In the project location, the understory is a rich assembly of native tree and shrub species growing beneath a canopy overwhelmingly comprised of resprouted eucalyptus trees. The eucalyptus reproduces rapidly from nuts and resprouts, increasing the fuel load and density. Additionally, a small percentage of the canopy assemblage comprises exotic acacia species, which also spread rapidly and produce flammable litter. [Monterey Pine, another fire prone exotic tree, is also present in the project area and will be removed in favor of the native, firesafe, trees.[27] The management strategy promotes a forest conversion: the emerging native forest of California Bay, Oak, Maple, Buckeye, Redwood and Hazelnut will be retained and the existing eucalyptus-dominated exotic canopy forest will be eradicated. The native species produce either considerably lesser fuel loads or are most fuel-productive well before the peak of the regional fire season. During the project, the native understory will be protected, while the exotic trees will be removed and their stump cambium chemically treated with herbicide to prevent re-sprouting. Felled eucalyptus[, pine[28] and acacia will be either removed - most will then be chipped - or lopped and scattered or chipped and scattered on the project site. Logs will be placed and retained as a component of the sediment/erosion control measures to be employed and will serve as habitat supporting a variety of wildlife. Protection of the native species, and ongoing management after project completion, will ensure a successful conversion protective of natural and recreational resource values, including but not limited to habitat, hydrology, soils and geology, and air quality. All cut tree stumps shall receive annual follow-up treatment of herbicides (Garlon 4, Stalker) on any emerging stump sprouts, to ensure the permanent elimination of eucalyptus from the project area. Follow up treatment of resprouts will be conducted until 100% resprout suppression is obtained. Additionally, eucalyptus seedlings emerging from the latent seed stock present in the project area will be managed over time to prevent re-colonization of this invasive species. The project duration is anticipated to be [18 - 24 months[29] [24 - 36 months[30], with [12 to 24 weeks[31] [20 to 30 weeks[32] of actual vegetation removal work. Follow-up treatment will occur at least quarterly, and will be conducted as an ongoing maintenance operation beyond the scope of the proposed grant. Follow-up efforts required for successful eradication of all eucalyptus resprouts and seedlings are anticipated to be 7 to 10 years.
. . . .
The outcome of the project will be the complete removal and permanent eradication of the invasive Bluegum Eucalyptus trees, currently numbering over [400[33] [280[34] per acre. These tall, fast growing, invasive, fire-prone trees represent a substantial hazard and extreme fuel load on this interface wildland. The trees will be cut using conventional forestry technologies, and the resulting biomass will be chipped and scattered, recycled, or retained as habitat. The trees will be initially treated with herbicide, then retreated semi-annually until 100% eradication is completed. The non-target trees will be saved and will be encouraged to continue to thrive in the project area, resulting in a much safer and stable vegetation type.[35]

         The University also explained why it viewed its project was the best alternative:

The eradication of the eucalyptus forest - as a goal - is the best method to cost-effectively control the vegetation management problem. Previous efforts have targeted the eucalyptus for removal, but had not eradicated the plant, so the trees grew back rapidly - up to 15 feet per year! The plan to allow the native plant species to succeed the invasive eucalyptus is thought to promote a sustainable, cost-effective approach, that has won broad acceptance from the community, including environmental activists and native plant societies.[36]

         The University addressed how its project would comply with federal laws and executive orders and complement other federal programs:

The work is complementary to efforts of the U.S. Fish and Wildlife Service in its mission to protect the endangered Alameda Whipsnake. Through this project, the potential habitat for this endangered snake will be increased, and the slow destruction of it [sic] remaining habitat, by continual eucalyptus colonization, is effectively halted. The USF&W is supporting similar projects on other nearby lands, having recognize the value of this approach to the recovery of endangered species.[37]

         2.2 The City of Oakland's and the East Bay Regional Park District's Subgrant Applications

         The City of Oakland also submitted a subgrant application to Cal OES for Pre-Disaster Mitigation grant funding.[38] Oakland explained that its proposed project “is a collaboration between the City of Oakland, UC Berkeley, and East Bay Regional Park District[.]”[39] Like the University, Oakland set forth its statement of work as one where “the existing eucalyptus-dominated exotic canopy forest will be eradicated” and the understory of native trees would be preserved.[40]

         The East Bay Regional Park District submitted a separate subgrant application to Cal OES for Hazard Mitigation Grant Program grant funding.[41] The Park District said that it “would reduce fuel loads primarily by promoting conversion of dense scrub, eucalyptus forest, and non-native pine forest to grassland with islands of shrubs. Oak and bay trees would be preserved.”[42]

         3. FEMA's Review of the Subgrant Applications

         FEMA's involvement in the hazardous-fire-risk-reduction projects triggered NEPA requirements.[43] In January 2008, FEMA published a notice of availability for a draft Environmental Assessment on the Strawberry Canyon project area for public comment.[44] The public-involvement process revealed concerns regarding the effectiveness and scope of the proposed vegetation-removal methods, the proposed application of wood chips in portions of the project area, impacts to plant and animal species in the area, and potential cumulative impacts of all projects in the project area.[45] Based on the findings of that Environmental Assessment, and after consulting with the U.S. Department of Homeland Security, the Council on Environmental Quality, Cal OES, and the subapplicants, FEMA decided to prepare an Environmental Impact Statement to address the potential environmental impacts of the projects proposed in the University's, Oakland's, and the Park District's subgrant applications.[46]

         On June 10, 2010, FEMA published in the Federal Register a notice of intent to prepare an Environmental Impact Statement. Hazardous Fire Risk Reduction, East Bay Hills, CA, 75 Fed. Reg. 32, 960 (June 10, 2010).[47] The notice of intent initiated a public scoping period that concluded on October 1, 2010.[48] FEMA conducted two public scoping meetings in August 2010 to solicit input from the public about the environmental topics to be included in the Environmental Impact Statement and the issues to be analyzed in depth.[49]

         On June 11, 2010 and October 15, 2010, FEMA sent participation letters to the U.S. Fish and Wildlife Service and the National Oceanic and Atmospheric Administration Fisheries Services, respectively, to notify them that it would be developing a biological assessment in accordance with the Endangered Species Act to determine whether the proposed action might adversely affect Endangered-Species-Act-listed species and/or their critical habitat.[50] On September 5, 2012, FEMA transmitted its biological assessment to the Fish and Wildlife Service and the Fisheries Service, initiating formal consultation under Section 7(a)(2) of the Endangered Species Act on the proposed hazardous-fire-risk-reduction methods in the proposed and connected project areas.[51]

         On May 3, 2013, FEMA published in the Federal Register a notice of availability of a draft Environmental Impact Statement. Environmental Impact Statements; Notices of Availability, 78 Fed. Reg. 26, 027 (May 3, 2013).[52]

         On May 10, 2013, the Fish and Wildlife Service issued a Biological Opinion for the project.[53]The Opinion described the project as one where “[t]he native understory would be protected while exotic trees would be removed and the cambium and stumps of eucalyptus (Eucalyptus species) and acacia (Acacia species) would be mechanically or chemically treated with herbicide to prevent re-sprouting” and one where the University “would be conducting selective eradication of exotic species (e.g., eucalyptus, Monterey pine, and acacia)[.]”[54] The Opinion addressed the potential effects of the project on three species listed as threatened under the Endangered Species Act - the California red-legged frog (Rana draytonii), the Alameda whipsnake (Masticophis lateralis euryxanthus), and the pallid manzanita (Arctostaphylos pallida) - and the designated critical habitat of one of the three species (the Alameda whipsnake).[55] With respect to the University, the Opinion found that its Claremont Canyon and Strawberry Canyon project would have short-term and temporary adverse effects on, but long-term benefits for, the California red-legged frog and the Alameda whipsnake and their habitats.[56]

         With respect to the California red-legged frog, the Opinion found that the University's project would temporarily displace or possibly injure or kill frogs and have a temporary adverse effect on suitable frog habitat within the action area during work activities.[57] The Opinion also found that the University's project would ultimately provide benefits because removal of eucalyptus and conversion to native plant species would benefit the frog by improving water quality (by removing eucalyptus, which is a source of phytochemicals that impair water quality) and by increasing the amount of time that aquatic habitats within the project area would remain wet.[58]

         With respect to the Alameda whipsnake, the Opinion noted that the University's initial treatment activities “would be limited to areas unsuitable for Alameda whipsnakes such as eucalyptus and other non-native forests. Therefore, no suitable Alameda whipsnake habitat would be disturbed during UCB's initial treatment activities.”[59] The Opinion found that the University's project might temporarily displace or possibly injure or kill whipsnakes living in habitats adjacent to the University's project sites.[60] The Opinion also found that the University's project would ultimately provide benefits because eucalyptus and other non-native forests are unsuitable for the whipsnake and the University's eradicating non-native trees would create new habitat areas for the whipsnake, including 32.9 acres of non-native forests that would be converted into “core scrub habitat” for the whipsnake.[61] By contrast, the Opinion found that the Park District's project to thin the eucalyptus forest would not significantly increase the whipsnake's core scrub habitat because 50% of the eucalyptus canopy cover would still be retained.[62] The Opinion found that the Park District's project to thin shrubs also would result in the permanent loss of core scrub habitat for the whipsnake.[63]

         The Opinion concluded that the project was not likely to jeopardize the continued existence of the California red-legged frog and the Alameda whipsnake in part because the University's removal of non-native trees would expand and improve the species' habitats.[64]

         The Opinion included an incidental-take statement that permitted limited harassment, injury, mortality, and capture of California red-legged frogs and Alameda whipsnakes in the Claremont Canyon and Strawberry Canyon project areas.[65] The Opinion recommended that, among other things, “FEMA, UCB [University of California Berkeley], and EBRPD [East Bay Regional Park District] should promote the eradication of non-native eucalyptus, Monterey pine, Monterey cypress, and French broom within and near suitable habitat for the Alameda whipsnake and the Presidio clarkia.”[66] The Fish and Wildlife Service said that the Opinion concluded its formal consultation with FEMA but noted that reinitiation of formal consultation would be required if, among other things, “the agency action is subsequently modified in a manner that causes an effect to the listed species or critical habitat that was not considered in this biological opinion.”[67]

         FEMA held three public meetings near the project area and received over 13, 000 comments on its draft Environmental Impact Statement.[68] After review and consideration of the comments, FEMA completed a Final Environmental Impact Statement. On December 5, 2014, FEMA published in the Federal Register a notice of availability of the Final Environmental Impact Statement. Environmental Impact Statements; Notice of Availability, 79 Fed. Reg. 72, 172 (Dec. 5, 2014).

         Among other things, in response to a number of public comments on the draft Environmental Impact Statement, FEMA, in coordination with the University and the other subapplicants, modified the proposed vegetation management for several project areas in the University's and Oakland's subapplications to implement a “unified methodology” more consistent with the Park District's approach of selective removal and thinning of trees in some areas.[69] With respect to the University's subapplications, the “unified methodology” would be applied to a 9.7-acre subarea of the 42.8-acre Claremont Canyon project area and three subareas totaling 12.4 acres of the 56.3-acre Strawberry Canyon project area.[70] In these areas, under the “unified methodology, ” there would be a greater emphasis on “thinning” rather than “complete removal” in order to achieve the fire-risk-reduction goals.[71] In the Claremont Canyon project area, the focus would be to remove tall trees, especially near the ridge top, reducing the volume of dead fuel on the ground and in tree canopies.[72] In thinned locations, understory vegetation and woody material would be removed, and the remaining trees would be limbed to a minimum height of ten feet.[73] In the Strawberry Canyon project area, instead of complete removal of all eucalyptus trees within the first two years, the focus would be to reduce fire fuels within 100 feet of structures.[74] In these subareas, the lower branches of all trees would be limbed to a minimum height of eight feet, and the understory vegetation would be removed.[75] Shrubs would be thinned to a minimum spacing of six feet.[76]Eucalyptus trees would remain, at an average spacing of 35 feet, with a clear understory.[77] Tall trees prone to torching would be removed, and no understory would remain near trees that were retained.[78]

         The Final Environmental Impact Statement reported that:

Based on the wildfire hazard characteristics of the East Bay Hills and the Miller/Knox Regional Shoreline, FEMA concluded that a need exists to reduce hazardous fire risk to people and structures in these areas. FEMA proposes to address this need by providing financial assistance to the subapplicants through the PDM and HMGP programs for long-term, cost-effective fuel reduction measures to reduce risk of loss of life and damage to vulnerable structures from wildfire.[79]

         On February 26, 2015, FEMA issued a 26-page Record of Decision documenting its review process and its decision to fund the University's subgrant applications, Oakland's subgrant application in part, and the Park District's subgrant application.[80]

         On March 27, 2015, FEMA sent letters to Cal OES notifying Cal OES that it was approving $291, 000 in grant funding for the University's Claremont Canyon project, [81] $282, 828 in grant funding for the University's Strawberry Canyon project, [82] $3, 000, 000 in grant funding for Oakland's project, [83] and $2, 268, 908 in grant funding for the Park District's project.[84] Each letter stated in part that:

Any change to the approved statement of work (SOW) requires prior approval from FEMA. The National Environmental Policy Act (NEPA) stipulates that additions or amendments to the SOW shall be reviewed by all state and federal agencies participating in the NEPA process. NEPA sign-off for all SOW additions or amendments is required before the revised SOW can be approved by FEMA or implemented by the [] Subgrantee.
We will work closely with you and your staff to ensure the success of the project. FEMA's goal is for all approved projects to begin immediately and to be completed within the timeframes specified in the project sub-application. Please be aware that this project and future projects may be disallowed for non-performance, or for violation of any federal, state, or local environmental law or regulation.[85]

         On April 3, 2015, Cal OES sent letters to the University, Oakland, and the Park District notifying them of the approvals.[86]

         4. Challenges to the University's Project

         Two sets of plaintiffs - (1) a non-profit organization called the Hills Conservation Network and (2) a non-profit organization called SPRAWLDEF (Sustainability, Parks, Recycling and Wildlife Legal Defense Fund), together with the environmental organization the Sierra Club[87] - filed suits to block the University's Claremont Canyon and Strawberry Canyon project (among other projects) from going forward. Broadly speaking, SPRAWLDEF argued in favor of the University's original plan of non-native-tree eradication and overstory removal, whereas HCN argued in favor of changing the entire plan to one focusing on selective thinning and understory removal. Both SPRAWLDEF and HCN objected to FEMA's change to a “unified methodology” approach - SPRAWLDEF because the “unified methodology” change went too far, and HCN because it did not go far enough.

         4.1 The Federal HCN and SPRAWLDEF Lawsuits

         4.1.1 Filing the lawsuits

         On March 6, 2015, HCN sued (1) FEMA and its acting regional administrator, (2) the director of Cal OES, (3) the University, (4) Oakland, and (5) the Park District.[88] The case was assigned to this court. HCN opposed the University's and Oakland's plan to eradicate non-native tree species and instead favored an alternative to “apply selective thinning” to the project area, removing underbrush and lower limbs of trees but otherwise leaving large trees (including non-native eucalyptus trees) in place.[89] HCN alleged that FEMA (1) violated NEPA and the APA by failing to adequately respond to HCN and its alternative proposals and (2) additionally violated NEPA and the APA by changing a portion of the project from the University's and Oakland's original proposal to eradicate non-native tree species to the “unified methodology” without circulating that change to the project as a supplemental Environmental Impact Statement.[90] HCN asked the court to enjoin FEMA's issuance of any funds for the projects and to enjoin any ground-disturbing activities by the subapplicants (including the University) that would be funded by FEMA's grant.[91]

         On May 26, 2015, SPRAWLDEF sued FEMA and its acting regional administrator.[92] The case was assigned to this court as related to the Federal HCN lawsuit. On August 20, 2015, SPRAWLDEF filed an amended complaint adding the University, Oakland, and the Park District as additional defendants.[93] SPRAWLDEF alleged that FEMA violated NEPA and the APA by changing a portion of the project from the University's and Oakland's original proposal to eradicate non-native tree species to the “unified methodology.”[94] In contrast to HCN, which advocated in favor of thinning and against wholesale eradication of non-native trees, SPRAWLDEF emphasized that the Fish and Wildlife Service's Biological Opinion required eucalyptus and pine removal (as opposed to merely thinning) to foster native scrub species with more manageable fire behavior and fuel characteristics and to promote the habitat of the Alameda whipsnake.[95] SPRAWLDEF asked the court to declare FEMA's Record of Decision and its Final Environmental Impact Statement to be violations of NEPA and to enjoin FEMA's grant funding until the Environmental Impact Statement was corrected.[96]

         4.1.2 Moving for summary judgment

         On March 1, 2016, HCN moved for summary judgment in the Federal HCN lawsuit. Among other things, HCN argued that FEMA's Environmental Impact Statement analyzed only two alternatives - the proposed project and the alternative of no action - without analyzing HCN's selective-thinning proposal.[97] HCN argued that the fact that FEMA adopted the “unified methodology” for a portion of the project showed that selective thinning was feasible and argued that FEMA's change was insufficient because the “unified methodology” begins with thinning but then follows up with eradication of non-native trees four to five years later, and hence the eradication is only delayed, not prevented.[98]

         On April 18, 2016, the Federal HCN defendants (including the University) opposed HCN's motion and cross-moved for summary judgment. Among other things, the University argued that:

[HCN]'s demand for across-the-board adoption of selective thinning ignores the greater erosion impacts that would result from implementing that method in heavily sloped areas. FEMA reasonably concluded that overstory removal was the appropriate methodology to apply where severe slope and other accessibility limitations would prevent the greater levels of long-term maintenance required by the selective thinning approach.
. . . .
“UC's land is not configured or improved to facilitate labor-intensive ground fuel removal, and any such efforts would be expensive, dangerous to workers and disruptive to faunal habitats, particularly those of the Alameda Whipsnake.”[99]

         On March 28, 2016, SPRAWLDEF moved for summary judgment in the SPRAWLDEF lawsuit. Among other things, SPRAWLDEF argued that “[a] Biological Opinion produced by the U.S. Fish & Wildlife Service makes clear that removal of the eucalyptus overstory and native species restoration is required not only to prevent long-term fire hazard and save public funds, but also to compensate for habitat impacts to several endangered species by restoring their native environment.”[100] It also argued that FEMA's adoption of “the vague ‘unified methodology' that appears to adopt thinning instead of native restoration in arbitrarily selected location” increased fire risk and harm to endangered species.[101] It argued that the Biological Opinion stated that “‘the [U.S. Fish and Wildlife] Service does not believe that any suitable Alameda whipsnake habitat will be created where eucalyptus forest is only thinned.'”[102]

         On April 18, 2016, the SPRAWLDEF defendants (including the University) opposed SPRAWLDEF's motion and cross-moved for summary judgment. Among other things, the University argued that even under the “unified methodology, ” it “remain[ed] obligated to create significant amounts of suitable habitat for the Alameda whipsnake: 167.9 acres, including 32.9 acres of core scrub habitat.”[103] In its reply, SPRAWLDEF continued to object to the “unified methodology, ” arguing that “FEMA arbitrarily and unreasonably required eucalyptus ‘thinning' in the four critical UCB-Oakland subareas only to placate HCN. Never satisfied, HCN now wants FEMA to apply the useless thinning projectwide. This was not a ‘technical decision' of FEMA's ‘experts.' It is not ‘risk balancing and scientific judgment.'”[104] Among other things, SPRAWLDEF argued that the “unified methodology” thinning approach was inconsistent with the Biological Opinion, which “was predicated completely upon the overstory removal so that the native understory, and its habitat, could be restored.”[105] SPRAWLDEF noted that FEMA, in its opposition to HCN's motion for summary judgment, argued that “[o]nly complete overstory removal results in the creation of habitat for the whipsnake.”[106]

         4.1.3 Settling the Federal HCN lawsuit and terminating the grants for the University's Claremont Canyon and Strawberry Canyon project

         On July 19, 2016, FEMA and Cal OES met with representatives of the University and advised that FEMA was considering terminating the grants with respect to the University's Claremont Canyon and Strawberry Canyon project.[107]

         On August 1, 2016, FEMA, joined by HCN and the director of Cal OES, moved to vacate the summary-judgment hearing in the Federal HCN lawsuit because “HCN, FEMA, and Cal OES have been engaged in productive settlement negotiations that will fully resolve the claims in this litigation and lead to dismissal of the case.”[108]

         On August 8, 2016, HCN, FEMA, and Cal OES filed a joint reply clarifying that they had reached a settlement framework whereby FEMA would terminate the grants for the University's and Oakland's projects.[109] HCN had agreed to the settlement, Cal OES was recommending it, and FEMA staff was recommending it to its senior management and to the Department of Justice.[110]

         By August 23, 2016, HCN, FEMA, Cal OES, and the Park District had drafted a formal settlement agreement, [111] and HCN and Cal OES had signed it.[112] The settlement agreement provided in relevant part that:

WHEREAS, HCN filed this action (“Action”) on March 6, 2015, challenging FEMA's February 2015 “Hazardous Fire Risk Reduction Record of Decision” (“ROD”), the related November 2014 Final Environmental Impact Statement, and the subsequent approval of grant funding for four grants alleging violations of the National Environmental Policy Act (“NEPA”), and FEMA regulations;
WHEREAS, defendants deny the allegations in the complaint and deny that any violations of NEPA or any other law occurred;
WHEREAS, the Parties believe it is in the best interest of the public, the Parties; and judicial economy to compromise and settle the issues in this Action;
NOW, THEREFORE, in consideration of the promises and covenants contained in this Stipulated Settlement Agreement (“Agreement”), the Parties agree to settle all claims and causes of action arising in or related to this Action as follows:
1. Termination of Grants:
a. Within fourteen (14) days of the effective date of this Agreement, FEMA and Cal OES (“Agencies”) will terminate the grants to the University of California (“UCB”) (PDMC-PJ-09-CA-2005-003; PDMC-PJ-09-CA-2005-011).
b. Within fourteen (14) days of the effective date of this Agreement, the Agencies will terminate the grant to the City of Oakland (“Oakland”) (PDMC-PJ-09-CA- 2006-004) except as it applies to the following three East Bay Regional Park District “(Park District”) [sic] Projects: Tilden-Grizzly, Sibley Triangle and Island, and Claremont Canyon-Stonewall (the “2006-04 Projects”).
c. The Parties agree that the grant to the Park District (HMCP #1731-16- 34R) will remain in full force and effect.
d. As to the part of the Oakland grant related to the Park District's 2006-04 Projects, the Agencies intend to make the Park District the subgrantee as to the funds to be allocated to those 2006-04 Projects. The Parties agree this part of the grant will remain in full force and effect. HCN agrees not to challenge the action to designate the Park District as the subgrantee or the reallocation of funds from the Oakland grant (PDMC-PJ-09-CA- 2006-004) to the Park District to implement projects from the Park District's Fire Hazard and Resource Management Plan.
2. Withdrawal of Project Decision:
a. FEMA will withdraw the parts of the February 2015 “Hazardous Fire Risk Reduction Record of Decision” (“ROD”) that relate to the UCB and Oakland projects. FEMA intends to issue public notice of its action withdrawing these parts of the ROD.
b. The Parties agree that the remainder of the ROD will remain in full force and effect.[113]

         On August 30, 2016, having heard that FEMA was considering not funding the University's Claremont Canyon or Strawberry Canyon project, a representative of the Fish and Wildlife Service sent an email that copied University representatives to advise that:

If FEMA decides not to fund the UC-Berkeley grants, then there no longer is a Federal nexus under Section 7 of the Endangered Species Act, and the biological opinion and associated incidental take permit for the UC-Berkeley fuels/vegetation management activities are no longer valid. In that case without a Federal nexus, UC-Berkeley would need to receive incidental take coverage through Section 10 of the Endangered Species Act (i.e., through developing a Habitat Conservation Plan (HCP)). UC-Berkeley should not start the fuels/vegetation management activities until they have a valid incidental take permit.[114]

         On September 1, 2016, the parties in Federal HCN reported to the court that HCN, FEMA, Cal OES, and the Park District had reached agreement on the terms of a settlement and memorialized those terms in a final document and a related request for dismissal.[115] The parties reported that (1) HCN and Cal OES had approved the settlement, (2) Park District staff were recommending approval to the Park District Board and that the Board would decide whether to join the settlement by September 6, (3) FEMA had recommended approval to the Department of Justice and that it expected to have a decision by September 28, and (4) the University opposed the proposal to terminate its grant funding.[116]

         On September 6, 2016, FEMA sent two letters to Cal OES (one relating to the Claremont Canyon subgrant and one relating to the Strawberry Canyon subgrant) stating that:

This letter is to inform you that the above Pre-Disaster Mitigation (PDM) grant is hereby terminated. This decision is the result of an agreement between FEMA and Cal OES to terminate the grant, pursuant to 2 C.F.R. §200.339(a)(3). As of today's date, no federal action is associated with these projects and therefore the Incidental Take Statement no longer covers the activities proposed for funding by this grant.[117]

         On September 7, 2016, Cal OES sent two letters to the University stating that the Claremont Canyon and Strawberry Canyon subgrants had been terminated “based on the agreement between FEMA and Cal OES to terminate the subaward pursuant to 2 C.F.R. 200.339(a)(3)” and enclosing FEMA's termination letters.[118] (Counsel for the University sent two letters to FEMA and Cal OES in response stating that “the purported termination of the PDM grant is invalid and illegal” and that “the University respectfully requests that ...


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