Endangered Species Law & Policy

The Fifth Amendment to the U.S. Constitution states, in part, “nor shall private property be taken for public use, without just compensation.” The federal Endangered Species Act deals with a different type of “taking.” Section 9 of the Endangered Species Act generally prohibits any person from “taking” any species of fish or wildlife listed as endangered. 16 U.S.C § 1538. This is a general prohibition, because if a project involves a federal permit or approval, a federal resource agency can prepare a biological opinion under Section 7 of the Endangered Species Act and issue an incidental take statement authorizing the take of the species under certain conditions. 16 U.S.C. § 1536. If a project does not involve a federal permit or approval, the project proponent can submit an application under Section 10 of the Endangered Species Act and seek an incidental take permit authorizing the take of the species under certain conditions. 16 U.S.C. § 1539.

In United Water Conservation District v. United States, the U.S. Court of Appeals for the Federal Circuit recently addressed whether precluding a California water conservation district from diverting water from a river to protect an endangered species of fish is a physical taking or regulatory taking under the Fifth Amendment to the U.S. Constitution. The distinction is important, because a regulatory takings claim is not ripe until the government entity issues a final decision regarding the application of the regulation, in this case the Endangered Species Act. In contrast, a physical takings claim is immediately ripe.

Summary of Key Facts and Procedural History

United Water Conservation District (United Water) had a license and permit providing it with the right to appropriate and divert up to 144,630 acre-feet of water per year from the Santa Clara River in California for United Water’s beneficial use. In 1997, the National Marine Fisheries Service listed a fish species that resides in the Santa Clara River as endangered. Approximately two decades later, the National Marine Fisheries Service sent United Water a letter stating that its current operations were resulting in take of the endangered species, and directing United Water to implement measures that would reduce United Water’s diversion of water from the Santa Clara River by at least 49,800 acre-feet per year. In response, United Water filed a complaint in the U.S. Court of Federal Claims against the United States, alleging that the action by the National Marine Fisheries Service resulted in a physical taking requiring just compensation under the Fifth Amendment. The Court of Federal Claims held that United Water’s claim was appropriately characterized as a regulatory takings claim, not a physical takings claim, and because United Water had not sought an incidental take permit under Section 10 of the Endangered Species Act its regulatory takings claim was not ripe.

The Federal Circuit’s Decision

In a highly fact specific decision, the U.S. Court of Appeals for the Federal Circuit affirmed the dismissal of United Water’s action. The Federal Circuit found that because United Water only had an appropriative water right as opposed to a riparian water right, and because United Water was merely required to avoid diverting water from the river as opposed to cutting off all access to water or forcing United Water to return water that had already been diverted, the taking claim was appropriately characterized as regulatory in nature. Further, because United Water had not been denied an incidental take permit under Section 10 of the Endangered Species Act, United Water had not obtained a final decision regarding the application of the Endangered Species Act, and therefore its regulatory takings claim was not ripe.  

Takeaways

While the overall impact of the Federal Circuit’s decision is somewhat limited by the specific facts of the case, it has potentially large ramifications for water agencies in California, particularly those that divert water from water bodies (e.g., rivers, streams, lakes) that provide habitat for species listed under the Endangered Species Act. Further, given the very real impact to United Water, one could reasonably anticipate that United Water would seek en banc review or even file a petition of writ of certiorari with the U.S. Supreme Court.