Final Rules Ramping Up Endangered Species Act Regulations Now in Effect

TAKEAWAYS

• The rules address the listing process for critical species and habitat designations, as well as protections for threatened species.
• In a reversal, the rules also revise the ESA Section 7 interagency consultation process and open the door for mitigation requirements.

On April 5, 2024, the U.S. Fish and Wildlife Service (USFWS) and the National Oceanic and Atmospheric Administration’s National Marine Fisheries Service (NMFS) (together, the Services) published three final rules that implement substantial changes to the Endangered Species Act (ESA). The long-awaited rules, which expand species conservation in the wake of loosened restrictions under the prior administration, address (1) the listing process for species and critical habitat designations; (2) protections for threatened species; and (3) the ESA Section 7 interagency consultation process.

The new rules went into effect on May 6, 2024, and are codified in 50 C.F.R. pt. 424, 50 C.F.R. pt. 402, and 50 C.F.R. pt. 17. The most significant changes, and the most likely to garner legal challenges, include (1) revisions to ESA regulations allowing the Services to impose compensatory mitigation obligations in the process of interagency consulting, and (2) revisions to the way critical habitats are designated.

Section 4 Listings and Critical Habitat Determinations (50 C.F.R. pt. 424)
The Services revised the implementing regulations for ESA Section 4 relating to the determination of threatened and endangered species and critical habitat designations in 89 Fed. Reg. 24,300. Particularly, the revisions focus on the procedures and criteria used for listing, delisting and reclassifying species listed on the Lists of Endangered and Threatened Wildlife and Plants and critical habitat designations. Broadly, each of the changes increases the Services’ leeway to designate species as endangered and to designate critical habitat areas.

Most importantly for critical habitat designations, the rule revised 50 C.F.R. § 424.12, “Criteria for Designating Critical Habitat,” to remove a limitation on the ability to designate critical habitat. The limitation, which was imposed in 2019, identified circumstances under which the Services may decide it is not prudent to designate critical habitat. 88 Fed. Reg. 50,764, 40,768. Ultimately, the Services concluded that the 2019 revision was not consistent with the ESA and that the 2019 rule had been interpreted by the public as allowing the Services to decline designation of critical habitat for species under threat of climate change. Eliminating this limitation will give the Services greater leeway to designate land as critical habitat.

The rule also revised § 424.12(b)(2) to address unoccupied critical habitat designations, which would refer to specific areas not within the geographical area the species occupies at the time it is listed under the ESA. 88 Fed. Reg. at 40,768 (finalized in 89 Fed. Reg. 24,300). The ESA distinguishes between occupied and unoccupied areas in its “critical habitat” definition. This rulemaking changed the standard for determining whether unoccupied areas are considered critical habitat. Particularly, the revision lays out a logical approach for identifying unoccupied critical habitat using the best scientific data available. 88 Fed. Reg. at 40,769. The revision also removed a sentence added in 2019 providing “that the Secretary ‘will only consider’ unoccupied areas to be essential where a critical habitat designation limited to occupied areas would be inadequate to ensure the conservation of the species.” 88 Fed. Reg. at 40,769 (finalized in 89 Fed. Reg. 24,300). Finally, the final rule strikes the requirement for the secretary to determine “with reasonable certainty” that the area will support the conservation of the relevant species and that the area contains at least one physical or biological feature that is considered essential to conserve the species. 88 Fed. Reg. at 40,769. Therefore, this revision deemphasizes the sequencing that the Services previously used whereby it would first determine that occupied habitat is inadequate to conserve the species before considering the designation of unoccupied habitat as critical. Ultimately, because these changes have pushed off substantive decisions to specific designations of critical habitat, litigation over individual critical habitat designations is likely, especially in light of the trend of the Services designating large, state-sized areas of critical habitat.

In a major shift for the listing of endangered species, the revised rule interprets the definition of “threatened species.” Threatened species are those that are likely to become endangered in the “foreseeable future.” 16 U.S.C. § 1532(2). This final rule clarified the definition of “foreseeable future” to extend “as far into the future as the Services can make reasonably reliable predictions.” 89 Fed. Reg. at 24,301. The Services noted that they would continue to follow their preexisting framework for determining the extent of the foreseeable future.

The rule also revised 50 C.F.R. § 424.11(e), regarding delisting of endangered species, to state that a species may be delisted if, after considering the standards and factors set forth in the regulations, the best commercial and scientific data available demonstrates that: “(1) [t]he species is extinct; (2) [t]he species has recovered to the point at which it no longer meets the definition of an endangered species or a threatened species; (3) [n]ew information that has become available since the original listing decision shows the listed entity does not meet the definition of an endangered species or a threatened species; or (4) [n]ew information that has become available since the original listing decision” demonstrates that the entity listed does not comply with the definition of “species.” 89 Fed. Reg. at 24,303. These revisions, however, are not likely to substantially change delisting efforts.

Blanket Rule Reinstatement for Threatened Species (50 C.F.R. pt. 17)
Another of the rules reinstates the “blanket 4(d) rule,” providing that threatened species receive the same protections as endangered species. The final rulemaking in 89 Fed. Reg. 23,919 revised 50 C.F.R. pt.17, and thus expands protections for threatened wildlife and plant species that have been newly listed pursuant to Section 4(d) of the ESA, consistent with the blanket protections that were in place prior to their repeal in 2019. 89 Fed. Reg. at 23,920.

Specifically, the two blanket rules, one for plants and one for animals, provide that it is illegal for a person subject to U.S. jurisdiction to:

(1) take endangered fish and wildlife within the United States or possess, sell, transport, carry or deliver any such fish or wildlife that has been illegally taken;

(2) remove and reduce to possession, destroy or maliciously damage any plants under federal jurisdiction, or to remove, dig up, damage, cut or destroy plants knowingly in violation of state laws or regulations; and

(3) import or export any endangered fish, wildlife or plants, or deliver, receive, transport, ship or carry in interstate or foreign commerce any such species in the course of a commercial activity, or sell the species in interstate or foreign commerce.

89 Fed. Reg. at 23,920. These blanket rules are subject to several exceptions. However, overall, the blanket rule provides for a streamlined process of endangered species protection and ensures that there are no gaps in protection. 89 Fed. Reg. at 23,921. The blanket rule also means the Services will be less likely to issue tailored rules for threatened species under 4(d).

Notably, the revisions also extended to federally recognized tribes certain exceptions to threatened species prohibitions that are currently provided to agents and employees of the Services and state and federal agencies to aid, dispose of or salvage threatened species. 89 Fed. Reg. at 23,921.

Revisions to Section 7 Consultation Regulations (50 C.F.R. pt. 402)
ESA Section 7 requires federal agencies to consult with the Services to ensure those agencies’ actions do not jeopardize the continued existence of any listed species or cause destruction to critical habitat. Previously, when proposed federal actions may adversely impact a critical habitat or listed species, the Services would consult and issue a biological opinion or, if take is likely to occur, an incidental take statement that allows a take so long as “reasonable and prudent measures” (RPMs) to minimize impacts from the incidental take are implemented. The Services’ position had been that Section 7 of the ESA requires take levels to be minimized, and that it was not appropriate to require mitigation for incidental take impacts.

The final rule, however, does a complete reversal of the Services’ longstanding position that mitigation cannot be required in Section 7 consultations by making two foundational changes: (1) the Services expand the purpose of the RPMs to include offsetting impacts resulting from the take as opposed to minimizing the take, and (2) the Services change the scope of RPMs to include onsite and offsite offsets or mitigation. 88 Fed. Reg. at 40,758.

More specifically, this rulemaking amended 50 C.F.R. § 402 to clarify that the Services may consider, for inclusion as RPMs, measures offsetting remaining incidental take impacts that cannot be avoided. 88 Fed. Reg. at 40,758. The additional measures are not an alternative to RPMs reducing or avoiding incidental take, but instead address residual impacts that remain after measures are applied to avoid incidental take. Id. at 40,759. The Services added that priority should be given to RPMs that reduce or avoid the anticipated future incidental take in the area. Id. at 40,759. This provision may, for the first time, require applicants for federal authorizations to complete compensatory mitigation (offsets) as part of the consultation process. The Services did not provide specifics on how the compensatory mitigation will be imposed but have indicated their intent to update their Consultation Handbook to provide additional guidance. Id. at 40,759.

Of the three new rules, this revision is the most certain to be the subject of legal challenges, as it is a significant departure from prior regulations, and some commentators have cited its facial inconsistency with the plain language of the ESA, which specifies in Section 7 only that RPMs are necessary to minimize impacts. By contrast, ESA Section 10 requires that incidental take permit applicants must “minimize and mitigate” the impacts of takings. Furthermore, it will likely impose significant additional financial and administrative burdens on applicants for federal authorizations.

Path Forward
Considerable uncertainty still remains about implementation of these final rules. However, the Services have indicated that they will release an updated ESA Consultation Handbook to provide much-needed clarity, guidance and specific examples of how the Services expect these rules to be implemented, and further discussion of the definitions of key terms. A public comment period will be provided on the updated Handbook, which is expected to be published imminently.

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