TESTIMONY OF CRAIG MANSON, ASSISTANT SECRETARY FOR FISH AND WILDLIFE AND PARKS, DEPARTMENT OF THE INTERIOR, BEFORE THE HOUSE RESOURCES COMMITTEE, REGARDING H.R. 2933, THE CRITICAL HABITAT REFORM ACT OF 2003

April 28, 2004

Mr. Chairman, I appreciate this opportunity to testify today on H.R. 2933, the “Critical Habitat Reform Act of 2003.”

Let me begin by saying that we are committed to achieving the primary purpose of the Endangered Species Act (ESA or Act) – the recovery of threatened and endangered species – and to improving the efficiency and effectiveness of the Act. We believe that conservation of habitat is vitally important to successful recovery and delisting of species.

As discussed in more detail below, the U.S. Fish and Wildlife Service’s (Service) efforts to carry out the ESA’s requirement of designating critical habitat have been a source of controversy and challenge for many years. As the Clinton Administration noted several years ago, in more than 30 years of implementing the Act, the Service had found that designation of official critical habitat provided little additional protection to most listed species, while consuming significant amounts of scarce conservation resources. The Department of the Interior (Department), Congress, and interested parties must work together to determine how to get the most value for species conservation out of available federal resources. With this in mind, we appreciate the opportunity to comment on H.R. 2933. We believe that the legislation is a step in the right direction, and would like to continue to work with the Committee on any proposed amendments to the ESA concerning the designation of critical habitat.

Background

For well over a decade, the Service has been embroiled in a relentless cycle of litigation over its implementation of the listing and critical habitat provisions of the Act. The Service now faces a Section 4 program in chaos due not to agency inertia or neglect, but to a lack of scientific or management discretion to focus available resources on the listing actions that provide the greatest benefit to those species in greatest need of conservation. The keystone of this situation is critical habitat.

The Service has characterized the designation of critical habitat as required under the Act as the most costly and least effective class of regulatory actions undertaken by the Service. It is often counterproductive and can result in negative public sentiment to the designation. This negative public sentiment is fueled by inaccuracies in the initial area designated when we must act with inadequate information to meet deadlines and because there is often a misconception among the public that, if an area is outside of the designated critical habitat, it is of no value to the species. On the other hand, the designation of critical habitat imposes often burdensome requirements on federal agencies and landowners, or is perceived by them as doing so, and the designation process can create significant economic and social turmoil.

For these reasons, for many years the Service often found designation of critical habitat to be “not prudent,” and did not designate it for most listed species; this approach was formalized during the previous administration. However, the legislative history is clear that Congress intended such findings to be limited to exceptional circumstances. In the late 1990s, some critics began challenging these “not prudent” findings in court; those successes led to a flood of additional suits which continue to this day. These lawsuits have subjected the Service to an ever-increasing series of court orders and court-approved settlement agreements, compliance with which now consumes nearly the entire listing program budget. This leaves the Service with little ability to prioritize its activities to direct resources to listing program actions that would provide the greatest conservation benefit to those species in need of attention. The previous Administration recognized this when it said that lawsuits which force the Service to designate critical habitat necessitate the diversion of scarce Federal resources from imperiled but unlisted species which do not yet benefit from the protections of the ESA.

The accelerated schedules of court-ordered designations have left the Service with limited ability to take additional time for review of comments and information to ensure the rule has addressed all the pertinent issues before making decisions on listing and critical habitat proposals, due to the risks associated with noncompliance with judicially imposed deadlines. This in turn fosters a second round of litigation in which those who will suffer adverse impacts from these decisions challenge them. This cycle of litigation appears endless, is very expensive, and in the final analysis provides relatively little additional protection to listed species.

Extensive litigation has shown that the courts cannot be expected to provide either relief or an answer, because they are equally constrained by the strict language of the Act. The Department of Justice has defended these lawsuits and sought to secure relief from the courts to allow the Service to regain the ability to prioritize the listing program according to biological need. Almost universally, the courts have declined to grant that relief.

In 2001, a federal district judge, in Center for Biological Diversity v. Norton, No. CIV 01-0258 PK/RLP (ACE), observed that “the Secretary is caught in a quandary” in trying to “fulfill the myriad of mandatory [ESA] duties.” The judge opined that “[m]ore lawsuits will inevitably follow” unless, among other things, the Service regains its discretion to prioritize its workload. The judge suggested that a legislative solution is necessary; otherwise “tax dollars will be spent not on protecting species, but on fighting losing battle after losing battle in court.”

Other courts have agreed with this assessment. Simply put, the listing and critical habitat program is now operated in a “first to the courthouse” mode, with each new court order or settlement taking its place at the end of an ever-lengthening line. We are no longer operating under a rational system that allows us to prioritize resources to address the most significant biological needs. I should note that it is as a direct result of this litigation that we have had to request a critical habitat listing subcap in our appropriations request the last several fiscal years in order to protect the funding for other ESA programs.
At this point, compliance with existing court orders and court-approved settlement agreements will likely require funding into fiscal year 2007.

In short, litigation over critical habitat has hijacked the program. Former Secretary Bruce Babbitt wrote in an op-ed piece in the April 2001 N.Y. Times that, in its struggle to keep up with court orders, the Service has diverted its best scientists and much of its budget for the ESA away from more important tasks like evaluating candidates for listing and providing other protections for species on the brink of extinction. We also believe that available resources could be better spent focusing on those actions that benefit species by providing the protection of the Act to those species that need it, and then pursuing effective conservation of these species through improving the consultation process, the development and implementation of recovery plans, and voluntary partnerships with states and private landowners.

For example, other more significant, and more efficacious, elements of a modern conservation strategy than critical habitat designations might include habitat conservation plans, conservation banking, voluntary agreements with landowners such as through the Service’s Partners for Fish and Wildlife Program, incentive-based actions such as those carried out under the Service’s Landowner Incentive Program, partnerships with states, tribes, and nongovernmental organizations, and private stewardship efforts by individuals and businesses. These programs, which consist of combined private and governmental action, improve the health of our lands, forests, rivers, and other ecosystems. Their implementation provides far greater conservation benefits than the designation of critical habitat while avoiding the regulatory, economic, and social disadvantages of critical habitat designations.

Congress added the strict deadlines to the Act to ensure that listing actions are completed in a timely manner. However, absent some measure to allow for a rational prioritization of the workload based on a consideration of the resources available, those strict deadlines will only worsen the current untenable situation. It cannot be overstated that managing the endangered species program through litigation is ineffective in accomplishing the purposes of the Act.

The Administration’s budget request for FY 2005 provides funding to meet resource protection goals and address the growing listing program litigation-driven workload. The requested increase includes a total of $13.7 million for critical habitat for already listed species. This is an increase of $4.8 million over the FY 2004 funding level. The increased funding will allow the Service to meet its current and anticipated court orders for the designation of critical habitat for already listed species. In this regard, I would note that as of April 26, 2004, there were 76 lawsuits pending or expressly threatened related to critical habitat or other section 4 actions.

Within the Department and the Service, we are taking those limited administrative steps available to us to address these issues. For example, I have directed the Fish and Wildlife Service henceforth to comply strictly with the statutory provisions for designation of critical habitat. This measure, reversing prior practices, will staunch the bleeding off of resources in “deadline” litigation. It is, however, an incomplete and less than sufficient step. That is because it may indeed spark a different form of litigation. These drawbacks remain to be seen and at least in the meantime, the Service will regain some degree of control over its program. Nonetheless, this highlights the need for a specific legislative solution.

We have made other modest changes to cut costs in the critical habitat designation process.

H.R. 2933 Provisions

H.R. 2933 directs that the timing of designation of critical habitat be concurrent with approval of recovery plans, a concept which the previous Administration supported. We recognize that this is one of a number of potential solutions by which Congress could address this difficult problem. The bill makes additional changes to the ESA to facilitate the process of designating critical habitat and potentially provide relief from the current litigation cycle that we have been facing.

It amends section 4(a)(3) of the Act by requiring that designation be practicable, economically feasible, and determinable. In addition, the measure prohibits the designation of an area that is subject to a habitat conservation plan or state or federal land conservation if the Secretary determines that these protections are substantially equivalent to the protection provided by critical habitat designation.

H.R. 2933 also specifies the factors for consideration when conducting an economic impact analysis of critical habitat designation, including the direct, indirect, and cumulative impacts associated with such designation. Additional factors in the economic impact analysis would also include consideration of lost revenues to landowners and Local/State/Federal governments, as well as the costs associated with reports, surveys, and analyses required to be undertaken, as a consequence of a proposed designation, by landowners seeking permits and approvals.

The proposed measure further modifies the content of the required notice for proposed designation to include any municipality having administrative jurisdiction over the area in which the species is believed to occur. In addition, the bill requires the Secretary to maintain, on a publicly accessible internet page of the Department of the Interior, a Geographical Information System map of the proposed designation, including coordinates of the area. Each required notice of the proposed designation shall also include reference to this internet page.

We believe that these provisions are steps in the right direction to address several of the Department’s concerns about the current designation process. We are also pleased that the bill codifies some of the reforms that the Administration has carried out over the past few years. As I have stated before, the Department is committed to working with the Congress to find a solution to the problems associated with critical habitat and other related issues. I want to reiterate that offer here today.

Summary

In sum, the present system for designating critical habitat is broken. The designation process provides little real conservation benefit, consumes enormous agency resources, and imposes social and economic costs. Rational public policy demands serious attention to this issue in order to allow our focus to return to true conservation efforts. We are optimistic that this bill will encourage a meaningful, bipartisan discussion on reforming the designation of critical habitat, and we are prepared to work with the Committee to identify ways to provide necessary legislative relief and ensure that any legislation clearly and efficiently accomplishes its goals.

Mr. Chairman, this concludes my prepared testimony. I would be pleased to respond to any questions you and other members of the Committee might have.