On 2 December, the U.S. Ninth Circuit Court of Appeals upheld the right of the State of California to review and disapprove federal offshore oil and gas leases as not "consistent" with California laws to protect the coast and environment. The case was precipitated when former Interior Secretary Bruce Babbitt refused to cancel 36 undeveloped oil leases off the central California coast. The State of California sued, arguing that the development of the leases would damage its coastal waters and fisheries. In the case, State of California v. Gale Norton (Ninth Circuit Court of Appeals, Case No. 01-16637), announced the 2nd, the 3-judge panel upheld a June 2001 lower court decision that the U.S. illegally extended leases over California's objections. The ruling is a major setback for the Bush Administration's efforts to open up the west coast to offshore oil development. Under the California Coastal Management Program, adopted pursuant to the federal Coastal Zone Management Act (CZMA) (16 USC 1451-1565), such a state consistency finding is required before a federal offshore oil lease program can proceed. The Administration sought to judicially strip or limit that state consistency finding authority.
California has long held that development of those 36 leases would not be consistent with state law and would, among other things, jeopardize key marine fisheries (see Sublegals 5:07/01; 5:02/01).
The Bush Administration has proposed canceling and buying back similar old leases offshore Florida (see Sublegals 5:22/02), but refused to consider the same remedy for California. Critics of the Administration claimed President George W. Bush's special deal with Florida was to provide re-election support for his brother, Florida Governor Jeb Bush, in a state where oil development is unpopular (see Sublegals 6:03/01). The issue of opposing federal offshore oil development also became a focal point in California Governor Gray Davis's successful reelection campaign, where Davis ran opposing extension of the federal leases. California has a state moratorium on offshore oil development; however a federal moratorium has to be periodically renewed and is expected to be a point of contention in the incoming 108th Congress and in the Administration's Energy Policy.
In addition to the CZMA consistency issue, the Ninth Circuit upheld the lower U.S. District Court's ruling that the federal Minerals Management Service (MMS) did not do an adequate analysis of the environmental consequences of its offshore development program. The Administration's only available judicial remedy now is an appeal to the U.S. Supreme Court, but so far officials have not indicated whether they will seek higher court review.
An alternative to an appeal of the decision, which sets a binding legal precedent for all western U.S. states within the Ninth Circuit's jurisdiction, may be an effort by the Administration to dilute the "consistency" provision in the CZMA law itself in the next Congress. Such a move, however, would face strong opposition from most coastal states, including those with Republican Governors. For more information on the ruling, see the 3 December Environment New Service article [below]. The case ruling itself can be found at:
SAN FRANCISCO - For a second time, the courts have ruled against federal plans to resume oil and natural gas drilling off the California coast. A three judge panel from a federal appeals court has upheld a lower court ruling that the government illegally extended 36 undeveloped oil leases off the central California coast, effectively blocking the renewal of the decades old leases.
The panel agreed with the state of California and environmental groups who had sued the federal government because of the environmental risks posed by oil drilling. The ruling upholds California's right to review the oil drilling leases under its Coastal Management Plan.
"Today's decision is a victory for all Californians, the environment, and states' rights," said California Governor Gray Davis. "The court's ruling is essentially a big stop sign to Washington. They should take the hint and halt further attempts to exploit California's spectacular coastal resources." In June 2001, U.S. District Judge Claudia Wilken ruled that the federal Minerals Management Service (MMS) failed to comply with the Coastal Zone Management Act, a law that grants states the authority to review federal actions that may affect their coasts. The judge also found that the lease extensions were illegal because the service did not study the environmental consequences of drilling the leases, as required by the National Environmental Policy Act.
The 9th U.S. Circuit Court of Appeals in San Francisco heard the case after the Bush administration appealed Judge Wilken's ruling. On Monday, a panel of judges from the appeals court upheld the lower court ruling in all respects.
"This is a victory for the millions of people who visit, live and work by California's coast," said Drew Caputo, a senior attorney with the Natural Resources Defense Council (NRDC), a national environmental group that joined in California's legal challenge. "After losing twice in federal court, it's time for the Bush administration to stop fighting for more oil drilling and to start protecting California's coast."
The fight over the renewal of the offshore leases has been going on since November 1999, when Governor Davis joined the California Coastal Commission in suing the U.S. Department of Interior. That suit sought to block extensions the federal government had granted oil companies for 36 undeveloped oil leases off the California coast.
The leases were first issued between 17 and 33 years ago, and would have expired more than 12 years ago if the federal government had not renewed them. Much has changed in the intervening years, argued Governor Davis and the Coastal Commission, who held that in granting the extensions, the Interior Department had failed to first analyze the environmental effects of this action under the National Environmental Policy Act.
In a 33 page opinion, the appeals court wrote that the lease extensions "represent a significant decision to extend the life of oil exploration and production off of California's coast, with all of the far reaching effects and perils that go along with offshore oil production." It noted that the 36 leases "are located between the Channel Islands National Marine Sanctuary and the Monterey Bay National Marine Sanctuary, which contain many species that are particularly sensitive to the impacts of spilled oil."
The ruling will allow California to delay the construction of any new offshore oil rigs while the California Coastal Commission studies the potential environmental impacts of renewed drilling on the suspended leases, which cover about 324 square miles of ocean. The federal government may perform its own environmental review, and if the state and federal reviews do not agree, the case may go back to court.
Environmental groups and other coastal states have been watching the California case closely, as it could set a precedent for state jurisdiction over drilling in near shore federal waters.
"This is an important legal victory because it validates the rights of all coastal states to review federal offshore drilling plans," said Richard Charter, a spokesperson for the conservation group Environmental Defense.
A spokeperson for the Interior Department said the agency has not yet decided whether to ask for further review of the decision by all nine members of the Ninth Court of Appeals. The only higher authority that the Bush administration can appeal to is the U.S. Supreme Court.
On Monday, Governor Davis said he was "prepared to take this case all the way to the Supreme Court to defend California's magnificent coastline and its rich ocean resources."
Proposals to reopen California's coast to drilling are also opposed by the state's U.S. Senators, Democrats Barbara Boxer and Dianne Feinstein. Earlier this year, the two Senators drafted legislation with members of Louisiana's Congressional delegation that would swap California's offshore leases for similar tracts off the Louisiana coast, but the Bush administration has not supported the legislation.
"This second court decision in favor of the state of California should send a clear signal to the Bush Administration that they should stop all their efforts to undermine California's strong environmental policies," Senator Boxer said Monday. "With my active support, our state will continue to fight any effort to harm our oceans, our forests, and our air and water quality."
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