A Big Win for Endangered Species, Texas and Real Conservation: a Big Loss for Lawsuit-based Conservation

Commentary

A Big Win for Endangered Species, Texas and Real Conservation: a Big Loss for Lawsuit-based Conservation

Due to a court decision Tuesday, the dunes sagebrush lizard, which lives in eastern New Mexico and western Texas, and the people and businesses of Texas, all face a brighter future. Fortunately for the lizard, the U.S. District Court for the District of Columbia found in favor of the U.S. Fish and Wildlife Service’s 2012 decision not to list it under the Endangered Species Act and against a lawsuit brought by the Center for Biological Diversity and Defenders of Wildlife seeking to reverse the agency’s decision (Case 1:13-cv-00919-RC, Documents 48 & 49, Filed 09/30/14). While the case was originally brought against the Department of Interior, in August 2013 the Texas Comptroller of Public Accounts was granted intervenor status, followed by several oil and gas trade associations in October 2013-American Petroleum Institute, the Independent Petroleum Association of America, the New Mexico Oil and Gas Association, the Permian Basin Petroleum Association, and the Texas Oil & Gas Association-because of their involvement with a conservation plan for the dunes sagebrush lizard that was initiated and coordinated through the Comptroller’s office (which will be discussed below) and which played a critical role in the Fish and Wildlife Service’s decision not to list.

More broadly, the court’s decision is a vindication of the approach taken by Texas Comptroller’s office over the past several years to find creative solutions to endangered species issues, which are often complex, conflict-ridden, and involve a dizzying array of public and private sector interests-all of which are trying to cope with the country’s most powerful environmental law. Don Barry, a longtime senior official at the Interior Department and various environmental groups, including his current job at Defenders of Wildlife, famously stated to the New York Times “The Endangered Species Act is the pit bull of environmental laws.” He characterized the Act in this way because “It’s short, compact and has a hell of a set of teeth. Because of its teeth, the act can force people to make the kind of tough political decisions they wouldn’t normally make.” The Act is also so powerful because of its unprecedented ability to stop economic activity and supersede just about any state or federal law.

A law that is so strong and has such a fearsome bite requires a firm guiding hand, lest the “pit bull” get off its leash. The Texas Comptroller’s office has been very effective in taking on this role, which is centered on striking a balance between endangered species protection and economic activity through a more proactive approach to finding creative solutions to the often-intimidating Endangered Species Act. Striking this balance is of considerable concern for states because they are at the intersection of maintaining their economic and environmental well-being and the requirements of federal Endangered Species Act.

As for the conservation of the dunes sagebrush lizard, at first glance it seems counterintuitive that the lizard would be better off not being listed under the Endangered Species Act because the point of the Act is to protect, not harm species. But the aspect of the Endangered Species Act many are not aware of is how the Act’s fearsome penalties discourage landowners from engaging in conservation efforts, which ultimately harms species. This is especially the case for species like the dunes sagebrush lizard that depend on private land for much of their habitat. In the lizard’s case about 46% of its habitat is privately owned.

A bit of background provides context for Tuesday’s court decision. In 2010 the U.S. Fish and Wildlife Service proposed to list the dunes sagebrush lizard under the Endangered Species Act. This caused a great deal of concern in large part because the lizard’s 745,000-acre range is in the Permian Basin, which produces 15% of U.S. oil and 5% of U.S. natural gas. In addition, the lizard’s habitat (73% of which is in New Mexico and 27% in Texas) overlays land used by the agriculture industry. The regulated community was very worried that if the lizard were listed the Endangered Species Act’s regulations could seriously impact their operations and impose substantial costs.

Yet starting in 2008 conservation efforts were under way for the lizard. About 95% of the lizard’s New Mexico habitat is covered by some sort of conservation agreement that limits oil and gas exploration, exploitation and transportation, prevents habitat fragmentation, and improves habitat quality.

Meanwhile, Texas, though its innovative and proactive approach to imperiled species conservation, undertook a couple of efforts, including surveys to determine if the lizard merited listing. When Fish and Wildlife proposed to list the lizard in 2010, there were only 3 known populations in Texas. Subsequently, the Texas Comptroller’s office provided funds for surveys in 2011 by a Texas A&M University professor who is a leading authority on the lizard that found an additional 28 populations. But in order to conduct these surveys on private lands, which is where the lizard is found in Texas, researchers had to sign confidentiality agreements with landowners. These agreements had the force of state law and were made possible through a provision in Texas Government Code passed in 2011 as part of the larger effort led by the Comptroller’s office to help the state become more involved in and proactive about Endangered Species Act issues.

The need for landowner confidentiality is understandable given the Endangered Species Act’s strong teeth. The Act has a notorious reputation in large portions of the country because it restricts otherwise normal and legal forms of land and resource use, such as ranching and oil and gas drilling, which penalizes landowners financially for harboring endangered species. Due to fear of suffering financial losses, many landowners refuse to grant access to their property to researchers and regulatory authorities (as I’ve documented in my just-published study on the ESA). This is damaging because accurate data and monitoring are crucially important to conservation, whether for imperiled or more common species.

Surveys for the dunes sagebrush lizard are part of the larger strategy pursued by Texas, led by the office of the Comptroller, to strike a balance between endangered species conservation and economic development and give the state a greater role in Endangered Species Act issues. In 2009, the state legislature passed a bill to create the Interagency Task Force on Economic Growth and Endangered Species, with the Comptroller as the presiding officer, that includes the Department of Agriculture, the Parks and Wildlife Department, the Texas Department of Transportation, and the State Soil and Water Conservation Board. The Task Force has several purposes: help municipalities and regional governmental bodies cope with the often bewildering and intimidating world of the Endangered Species Act through technical assistance; help formulate and implement species conservation initiatives and plans; assess the economic impact of federal, state and local endangered species regulations; and create advisory committees to help the Task Force (a good overview of all of this is available here).

After the successful survey for the dunes sagebrush lizard, in 2013 the Texas Legislature appropriated $5 million, through zero-based budgeting, for the Comptroller, through the Habitat Protection Fund (which is specified under the 2011 Texas Government Code) to contract with state universities for further surveys and research on species that might be listed under the Endangered Species Act. As with all aspects of the endangered species initiative led by the Comptroller’s office, the survey initiative has a robust system of checks and balances to ensure the validity of the process and the research conducted, which includes peer review, third party audits, compliance with state procurement guidelines, conflict of interest provisions, and working groups consisting of state and federal agencies (including the U.S. Fish & Wildlife Service, which oversees implementation of the Endangered Species Act), state universities, trade associations, conservation organizations (including the Environmental Defense Fund), and biologists and scientists from outside of Texas in a further effort to ensure the validity and impartiality of the process.

Another key aspect of Texas’s progressive approach to endangered species issues led by the Comptroller’s office is innovative conservation plans based on the successful voluntary, non-regulatory effort led by the state to conserve the endangered golden-cheeked warbler in the vicinity of the Fort Hood military base in central Texas in the mid-2000s and free-up land for military training that was encumbered by Endangered Species Act protections for the warbler (a good article on it is available here, and Texas A&M University, which helped coordinate the initiative has a very informative website here). In the case of the lizard, the Texas Conservation Plan for the Dunes Sagebrush Lizard is based on a number of provisions, including; a robust scientific process, beneficial and measurable conservation outcomes, participation by a wide range of stakeholders from the state and federal levels, the regulated community, and academia, effective monitoring and oversight by independent third parties, regular reporting on the plan’s progress and implementation, and a highly innovative habitat mitigation mechanism called the Recovery Credit System.

The Texas Conservation Plan, including the Recovery Credit System, for the lizard had to get sign-off from the U.S. Fish and Wildlife Service so the plan was formulated as a Candidate Conservation Agreement with Assurances (CCAA) under the Endangered Species Act’s Habitat Conservation Plan provision. While all this jargon may be confusing, it basically means private landowners are given assurances from the federal government that “they will not be subject to additional restrictions if the species becomes listed under the ESA,” according to the Fish and Wildlife Service. But in order for the Fish and Wildlife Service to approve the CCAA for the dunes sagebrush lizard there needed be an approved permit holder, and the Comptroller volunteered to take on this role (the supporting documents are available here). This, as well as the leadership role played by the Comptroller’s office in endangered species issues in Texas, resulted in criticism from several quarters, including the environmental pressure groups that were plaintiffs in the recently-decided lawsuit. They are unhappy with a state stepping into the arena they have grown accustomed to dominating.

Under the Recovery Credit System, lizard habitat impacted by, for instance, oil and gas operations is mitigated through the purchase of credits from nearby landowners who agree to specified actions to conserve and improve lizard habitat. While habitat mitigation schemes have been around for decades, the Recovery Credit System is cutting-edge for a number of reasons, one of which is that the plan’s very strong scientific, monitoring and governance structures ensure meaningful conservation outcomes and a transparent process for all stakeholders. One of the most remarkable aspects of the System is that the exchange of credits is based on a reverse, or low-bid, auction, which serves to drive down the cost of credits, thereby resulting in more efficient use of scarce resources to conserve endangered species.

As with the lizard surveys, a key part of the Recovery Credit System is protecting landowners’ confidentiality because of their fear of the Endangered Species Act. In Texas, landowners’ confidentiality has been protected under state law, which provides a more durable and stronger form of protection than if this were done administratively. This is crucially important because while public officials come and go, landowners often possess their properties for decades, if not longer. Furthermore, landowners are so gun-shy of the Endangered Species Act and suspicious of the U.S. Fish and Wildlife Service, as well as environmental pressure groups that like to use the Act as a club, that landowners’ confidentiality must be protected in meaningful ways if they are expected to participate in endangered species conservation efforts. Overall, the voluntary, non-regulatory nature of the Recovery Credit System, and more broadly the innovative Texas approach to conserving endangered species, is successful precisely because it does not alienate landowners, create anti-conservation incentives, and lead to unproductive, distrustful relationships. In fact, it leads to the opposite of all these problems.

From an institutional perspective, the lead role played by Texas’ Comptroller of Public Accounts has been key because it has permitted a broader, more innovative and flexible approach to endangered species issues than almost certainly would have occurred had a state agency focused solely on environmental issues taken the lead. The Endangered Species Act is a very tricky issue, especially for states, which need to balance many often-competing interests, including economic and financial, environmental, and various levels of government (i.e., municipal, state and federal). The Endangered Species Act’s power and complexity discourages innovation, which is all the more need for states to become more assertive and proactive, as Texas has done. An example of this is that the Texas Comptroller holds the permit issued by the U.S. Fish and Wildlife that made the sagebrush lizard conservation plan pass legal muster, and this is also why the Comptroller was granted lead intervenor status in the lawsuit brought against the Texas Conservation Plan.

The results of the Texas Conservation Plan for the dunes sagebrush lizard have been impressive. Under the plan, 227,385 acres have been enrolled, and a remarkable testament to the plan’s success is how little lizard habitat has been disturbed. Under the plan, 1% of the lizard’s habitat in Texas, or 2,173 acres, is permitted to be disturbed over the plan’s first three years. Yet as of August 2014, two years in to the plan, only 30.6 acres, or 1.4% of the allowable amount (which constitutes 0.014% of Texas’s lizard habitat) has actually been disturbed.

When the federal government decided in 2012 not to list the dunes sagebrush lizard under the Endangered Species Act, it cited the Texas Conservation Plan as a key factor in its decision. Ken Salazar, then-Interior Secretary, said:

“This is a great example of how states and landowners can take early, landscape-level action to protect wildlife habitat before a species is listed under the Endangered Species Act. The voluntary conservation efforts of Texas and New Mexico, oil and gas operators, private landowners and other stakeholders show that we don’t have to choose between energy development and the protection of our land and wildlife – we can do both.”

And Dan Ashe, Director of the U.S. Fish and Wildlife Service stated:

“The states of New Mexico and Texas have worked tirelessly with the Fish and Wildlife Service, the Bureau of Land Management and scores of landowners and operators in the Permian Basin to conserve and protect habitat that supports the dunes sagebrush lizard and many other species. These ongoing efforts will play a key role in ensuring the future of the lizard, while allowing responsible oil and gas development to continue.”

All of this is a real win-win, especially in the increasingly conflict-ridden landscape of the Endangered Species Act. The lizard wins because it gets beneficial and innovative conservation efforts, the regulated community wins because it gets a predictable and affordable process that allows it to stay in business and the cloud of an impending species listing is removed, and there is buy-in at every level of government. This is a huge success story to everyone except the Center for Biological Diversity and Defenders of Wildlife. These groups filed the lawsuit that they lost Tuesday because they contended the New Mexico and Texas conservation plans did not adequately protect the lizard. While the evidence argues otherwise, it is also telling that these groups are not actually involved in the difficult and time-consuming work of making these conservation plans function, much less using their multimillion dollar budgets (Defenders of Wildlife, 2013 revenue, $33.9 million; Center for Biological Diversity, 2013 revenue, $9.3 million) to do some boots-on-the-ground conservation. $43.2 million can buy you a lot of dunes sagebrush lizard habitat.

Two aspects of the Texas Conservation Plan the Center and Defenders strongly objected to in their court filings (which are available here, along with all court documents from the case) were the confidentiality agreements under which landowners are included in the plan (under a provision known as a Certificate of Inclusion) and the scientific standards underpinning the plan. On the issue of confidentiality, the court stated “Plaintiffs argue that the FWS’s reliance on the Texas Plan was arbitrary and capricious because the Service did not-and could not-review the Certificates of Inclusion detailing conservation measures adopted by each participant, which are confidential under Texas law.” The court added, “Plaintiffs also claim in passing that the Service’s inability to access the Certificates of Inclusion precludes finding any ‘certainty’ in the Texas Plan’s implementation or effectiveness.” On the other side of the issue, according to the court ruling, “Federal Defendants and Intervenor Defendants submit that access to each individual Certificate is unnecessary given that the FWS is fully able to monitor the Texas Plan at an aggregate level.” The court, however, found in favor of the defendants: “Because the Texas Plan had sufficiently clear objectives and enabled regular monitoring, the FWS’s reliance upon the Texas Plan was reasonable, notwithstanding the confidentiality of the Certificates of Inclusion.” As for the science supporting the plan, which the Fish and Wildlife Service used in its decision not to list the lizard, “the Court finds that the FWS’s withdrawal decision rested on ‘the best scientific and commercial data available,’ as required by the ESA.” And the judge stated the environmental pressure group plaintiffs “proffer no scientifically superior data from the administrative record that FWS failed to consider.” All of this was quite a ringing endorsement of the regulatory and scientific validity of not only Texas’ dunes sagebrush lizard conservation plan but more generally of the approach taken by the Texas Comptroller’s office to deal with the Endangered Species Act.

Part of the bigger picture, which the Center for Biological Diversity and Defenders of Wildlife fail to see, is that the Endangered Species Act represents an especially counterproductive approach to endangered species conservation. The reason stems from the Act’s penalty-based approach, which discourages landowners from conserving species, including disclosing the presence of species on their land. Worse, the Act creates very strong incentives for landowners to rid their property of species and habitat. Happily, there are growing numbers of people who understand this, including those in Texas who are leading the way toward a more successful approach to conserving endangered species.

A cornerstone of such an approach consists of protecting landowners from the Endangered Species Act and federal government, as well as finding more of a balance between economic activity and endangered species protection. The reasons for this are disarmingly simple. Landowners control most endangered species habitat in this country. Also, landowners are on the land day-in, day-out, have intimate knowledge of their property, and most of them are proud stewards and outstanding conservationists. Furthermore, if landowners’ property values and livelihoods are threatened by restrictions for endangered species, then landowners will take actions to rid their property of species and the habitat necessary to support these species. So if effective conservation is to occur-as opposed to the type of armchair conservation pressure groups who like to litigate excel at-it must be done with the willing cooperation of landowners. The ongoing successful effort to conserve the dunes sagebrush lizard through Texas’ conservation plan is testament to this.

Some words of wisdom about the dunes sagebrush lizard and endangered species conservation in general are offered by Dr. Benjamin Tuggle, Southwest Regional Director of the U.S. Fish and Wildlife Service (the Southwest Region contains New Mexico and Texas), in an NPR interview:

“Whenever you talk about big gas and oil and you talk about a listed species, particularly a reptile – a little-bitty lizard – there’s always the opportunity for cynicism. There’s always the opportunity to say that big government is coming in and trying to tell us what to do, and being over-officious and regulatory. I think this is a classic example, a monumental example, of when people sit down, talk to one another, communicate what it is that they need to continue the economic development on a landscape, and have an opportunity to listen to what it is that needs to take place on that landscape to protect species of this ilk. When they get together and can reach agreement then it works. So there isn’t this situation where the government is being dictatorial. It very much is a collaborative process that everybody gets something out of. We very much would like to see that take place because it creates less of a polarizing situation between people that are trying to make a living on the landscape and the resources, particularly the species and habitat that are dependent on that same landscape.”

Fortunately for the dunes sagebrush lizard and the state of Texas the U.S. District Court sent a strong message that cutting-edge, state-based conservation plans can survive legal challenge and will be respected under federal law. In a larger sense, the District Court’s ruling is a vindication of the ground-breaking and successful path taken by the Texas Comptroller’s office to chart a path though the political and regulatory minefield that is the Endangered Species Act. The court’s decision also has very important implications for states, landowners, businesses, and non-governmental organizations across the country that are involved in efforts to conserve endangered species with innovative conservation initiatives, especially those initiatives that are designed to keep species from being listed. Hopefully with Tuesday’s court decision more states will feel emboldened and confident to chart their own path forward on the Endangered Species Act. If this happens, we may finally move towards substantive reform of the Act that is more successful for species, states, landowners, federal government, regulated community, and non-governmental groups.

Brian Seasholes is a former research fellow with Reason Foundation.