[Senate Hearing 108-356]
[From the U.S. Government Publishing Office]



                                                        S. Hrg. 108-356

 ENDANGERED SPECIES ACT: REVIEW OF THE CONSULTATION PROCESS REQUIRED BY
                               SECTION 7

=======================================================================

                                HEARING

                               before the

                      SUBCOMMITTEE ON FISHERIES, 
                          WILDLIFE, AND WATER

                                 OF THE

                              COMMITTEE ON
                      ENVIRONMENT AND PUBLIC WORKS
                          UNITED STATES SENATE

                      ONE HUNDRED EIGHTH CONGRESS

                             FIRST SESSION

                                   ON


 AN EXAMINATION OF THE CONSULTING PROCESS REQUIRED BY SECTION 7 OF THE 
                         ENDANGERED SPECIES ACT


                               __________

                             JUNE 25, 2003


                               __________


  Printed for the use of the Committee on Environment and Public Works



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               COMMITTEE ON ENVIRONMENT AND PUBLIC WORKS

                      one hundred eighth congress
                             first session

                  JAMES M. INHOFE, Oklahoma, Chairman
JOHN W. WARNER, Virginia             JAMES M. JEFFORDS, Vermont
CHRISTOPHER S. BOND, Missouri        MAX BAUCUS, Montana
GEORGE V. VOINOVICH, Ohio            HARRY REID, Nevada
MICHAEL D. CRAPO, Idaho              BOB GRAHAM, Florida
LINCOLN CHAFEE, Rhode Island         JOSEPH I. LIEBERMAN, Connecticut
JOHN CORNYN, Texas                   BARBARA BOXER, California
LISA MURKOWSKI, Alaska               RON WYDEN, Oregon
CRAIG THOMAS, Wyoming                THOMAS R. CARPER, Delaware
WAYNE ALLARD, Colorado               HILLARY RODHAM CLINTON, New York

                Andrew Wheeler, Majority Staff Director
                 Ken Connolly, Minority Staff Director
                                 ------                                

             Subcommittee on Fisheries, Wildlife, and Water

                   MICHAEL D. CRAPO, Idaho, Chairman
JOHN W. WARNER, Virginia             BOB GRAHAM, Florida
LISA MURKOWSKI, Alaska               MAX BAUCUS, Montana
CRAIG THOMAS, Wyoming                RON WYDEN, Oregon
WAYNE ALLARD, Colorado               HILLARY RODHAM CLINTON, New York

                                  (ii)

  
                            C O N T E N T S

                              ----------                              
                                                                   Page

                             JUNE 25, 2003
                           OPENING STATEMENTS

Baucus, Hon. Max, U.S. Senator from the State of Montana.........    33
Crapo, Hon. Michael D., U.S. Senator from the State of Idaho.....     1
Inhofe, Hon. James M.,U.S. Senator from the State of Oklahoma....     3
Murkowski, Hon. Lisa, U.S. Senator from the State of Alaska......     8

                               WITNESSES

Chilton, Jim, Arizona Rancher, on behalf of the Public Lands 
  Council and the National Cattlemen's Beef Association..........    26
    Prepared statement...........................................    99
Domenici, Hon. Pete V., U.S. Senator from the State of New Mexico     3
    Prepared statement...........................................    34
Glen, Alan M., Counsel, Smith, Robertson, Elliott, and Glen......    20
    Prepared statement...........................................    43
Hill, Barry, Director, Natural Resources and Environment, U.S. 
  General Accounting Office. Accompanied by: Trish McClure, 
  Deputy Director, Office of Natural Resources and Environment, 
  U.S. General Accounting Office.................................    10
    Prepared statement...........................................    36
Horn, Patricia, Vice President and General Counsel, OGE Enogex 
  Inc............................................................    24
    Prepared statement...........................................    96
Kostyack, John, Senior Counsel, National Wildlife Federation.....    22
    Prepared statement...........................................    92
Snape, William, Vice President and Chief Counsel, Defenders of 
  Wildlife.......................................................    28
    Prepared statement...........................................   102

                          ADDITIONAL MATERIAL

Dieker, Richard, President, Yakima Basin Joint Board.............   105

 
ENDANGERED SPECIES ACT: REVIEW OF THE CONSULTATION PROCESS REQUIRED BY 
                               SECTION 7

                              ----------                              


                        WEDNESDAY, JUNE 25, 2003

                               U.S. Senate,
         Committee on Environment and Public Works,
            Subcommittee on Fisheries, Wildlife, and Water,
                                                    Washington, DC.
    The committee met, pursuant to notice, at 9:33 a.m. in room 
406, Senate Dirksen Building, the Hon. Michael D. Crapo 
[chairman of the subcommittee] presiding.
    Present: Senators Crapo, Murkowski, and Inhofe [ex 
officio].

 OPENING STATEMENT OF HON. MICHAEL D. CRAPO, U.S. SENATOR FROM 
                       THE STATE OF IDAHO

    Senator Crapo. The hearing will come to order.
    Good morning. Welcome. Today the Subcommittee on Fisheries, 
Wildlife, and Water will examine the process of Section 7 
consultation under the Endangered Species Act. Senator Domenici 
has been kind enough to join us to discuss some rather serious 
problems with regard to Section 7 and the Endangered Species 
Act in New Mexico. Senator Domenici must chair a hearing at 10 
o'clock a.m., so we are going to move quickly through our 
opening statements so that Senator Domenici can get to that 
hearing on time.
    Section 7(a)(2) of the Endangered Species Act requires 
Federal agencies to consult with either the U.S. Fish and 
Wildlife Service, or the National Marine Fisheries Service to 
ensure that any action authorized, funded, or carried out by 
such agency is not likely to jeopardize the continued existence 
of any endangered species or threatened species.
    Since 1986, when the Fish and Wildlife Service and the 
National Marine Fisheries Service published their joint 
consultation regulations, the consultation process has 
mushroomed into a lengthy and expensive procedure that is 
increasingly burdening all the agencies required to participate 
in it.
    To begin with, the size of the program has grown beyond 
what anyone ever imagined in 1986. More than 900 species have 
been added to the list since then. There is another very 
significant reason that consultation has become such a 
burdensome and costly proposition. Much of this boils down to 
two words: ``may affect.''
    If a Federal action may affect a listed species, then the 
consultation process is triggered. The only way a consultation 
can be avoided is if the project will have no effect on the 
listed species. ``May affect'' is defined as a beneficial, 
benign, or adverse action.
    Once it has been determined that an action may affect a 
listed species, consultations are divided up into those that 
are ``not likely to adversely affect,'' and ``likely to 
adversely affect.'' The former result in informal consultation, 
and the latter in formal consultation. In order for the 
Services to make a ``not likely to adversely affect'' 
determination, the effects of the action must be discountable, 
or insignificant, or completely beneficial.
    Obviously these regulations were intended to protect the 
listed species that we are attempting to recover. Despite this, 
the Services are consulting on tens of thousands of actions 
each year with effects that are, in fact, discountable, 
insignificant, or completely beneficial.
    For example, in 2001, Region 1, which is Idaho, Washington, 
Oregon, California, Nevada, and the Pacific Islands of the Fish 
and Wildlife Service, completed 14,004 Section 7 consultations. 
Of those, only 863 were formal consultations, which means that 
the other 13,141 were expected to have effects that were 
discountable, insignificant, or completely beneficial.
    Precisely three of those consultations resulted in jeopardy 
opinions. As I said earlier, the focus and purpose of Section 7 
is to ensure that Federal actions do not jeopardize the 
continued existence of listed species. In Region 1, only three 
Federal projects of the 14,004 were determined to be 
potentially jeopardizing to the continued existence of the 
species.
    On the one hand, this is good news. The agencies are doing 
a good job of avoiding adverse effects. The problem is that the 
Services are expending colossal resources on a process that 
produces a lot of paperwork for Agency staff without a lot of 
positive impacts on recovery. No other agency in the Federal 
Government engages in such massive red tape to ensure 
compliance.
    Congress has been concerned that these costs and delays 
that continue to increase funding levels for consultation 
staff. In a report published last year on salmon funding 
expenditures, the General Accounting Office reported that in 
the 5 years preceding 2002, the National Marine Fisheries 
Service's Northwest Region's consultation staff had grown from 
six to 120. Yet, I continue to hear problems, delays, and 
costs. I do not have a perception that additional funding is 
going to address these issues.
    Let me close by reading from a memo sent to Forest Service 
Chief Dale Bosworth, by Regional Forester, Jack Blackwell, on 
April 30, 2001. He states:
    ``I cannot adequately convey the high levels of 
frustration, anxiety, and feelings of helplessness that are 
occurring both internally and externally as we attempt to 
manage the national forests, and deal with ESA Section 7, 
processes.
    ``We all care deeply about and want to conserve species. 
Like the majority of the American public, we strongly support 
the ESA and recognize it is probably not going to be amended 
anytime soon. But something significant must change in order to 
bring more effectiveness, efficiency, and common sense to the 
Section 7 consultation process.
    ``The time is right to initiate serious multi-agency 
reforms that do not require congressional action. The amount of 
effort required to get projects through consultation is 
increasing and appears to be the same investment in people 
regardless of the project's potential impact or risk to the 
listed species or its habitat.
    ``Once a project is more than a 'no affect' determination, 
the amount of documentation and analysis seems nearly 
identical. We are spending a disproportionate amount of time 
and effort on projects viewed by Forest Service biologists as 
low risk.
    ``I am gravely concerned that we continue to expand scarce 
resources on a process that does not appear to provide 
significant conservation or recovery benefits. I hope this will 
be the first of several discussions with how we might create a 
process that is less costly and laborious, and delivers 
meaningful conservation benefits to species on the ground.''
    With that, I will turn to our chairman of the full 
committee, Senator Inhofe.

 OPENING STATEMENT OF HON. JAMES M. INHOFE, U.S. SENATOR FROM 
                       THE STATE OF IDAHO

    Senator Inhofe. Thank you, Mr. chairman.
    Let me just tell me that my prepared statement is almost 
verbatim yours. I am going to be asked that it be put in the 
record.
    Senator Crapo. Without objection, so ordered.
    [The prepared statement of Senator Inhofe follows:]
    Senator Inhofe. We do have a problem here. I see that our 
friend from New Mexico has his silvery minnow problem. We have 
the Arkansas shiner. I probably would swap with you right now. 
There are serious problems there. Pat Horn, accompanied by Paul 
Renfrow, who have come up from Oklahoma, will be testifying in 
the third panel. I will be back for that.
    Unfortunately, we have a Senate Armed Services Committee 
hearing two floors down at exactly the same time. Mr. Chairman, 
after we hear from Senator Domenici, I will go to that hearing 
and then come back for the third panel.
    You know that there is a problem when even the Ninth 
Circuit Court of Appeals in San Francisco, which is about the 
most liberal court in the country, has overturned Fish and 
Wildlife consultation decisions on the grounds that they had no 
evidence to back them up. We will get to some of these.
    Thank you, Mr. Chairman.
    Senator Crapo. Thank you very much, Mr. Chairman.
    Without anything further, Senator Domenici, the floor is 
yours to present your testimony.
    Welcome. Thank you for being with us today.

  STATEMENT OF HON. PETE V. DOMENICI, A UNITED STATES SENATOR 
                  FROM THE STATE OF NEW MEXICO

    Senator Domenici. Thank you, Mr. Chairman, and Senator 
Inhofe.
    I think in the final analysis there are very few Americans 
who would oppose a national law that said, ``Let us try to 
protect endangered species.''
    However, what has happened to the Endangered Species Act is 
that it is being applied without any common sense.
    The interpretation and the implementation of the Act have 
gone greatly awry. The process has become extremely combative. 
When the judicial combat occurs, it would appear that the 
participants' goal is to win no matter what.
    In fact, the result is rather lacking in common sense. 
Clearly, if you submit this to a large cross-section of 
Americans and say, ``Would you come up with this opinion to 
save this species?'', you would find a minute number would 
agree with it.
    Look at the case concerning Albuquerque, New Mexico. The 
City is up and down the Rio Grande River from just north of 
Santa Fe, all the way to just where the Rio goes into El Paso, 
Texas. We have a little minnow in the Rio Grande called the 
silvery minnow. The Rio Grande River is not a wet river like 
those in the East. As I grew up as a young man, for long 
periods of time during the year, big stretches of the Rio 
Grande were without water. It is actually a river that runs 
with water only when you have a lot of rain. In the last 50 
years, the river has run only when you are letting out enough 
water to make it wet. Otherwise, it has deep sand pockets that 
suck up all the water you can put in it. It is very hard to 
make it run.
    Nonetheless, there has been an ongoing battle that the 
habitat for this minnow, as far as a certain group of 
environmentalists are concerned, must run wet throughout a very 
lengthy area of the river. This calls for huge amounts of 
water. The only place we can get it is to start dumping our 
reservoirs.
    What we have now is a Tenth Circuit Court opinion that 
places the needs of this small endangered fish over the needs 
of the people of our State. On June 12th, by a 2-1 decision, 
the Tenth Circuit ruled that the Federal Government can 
completely disregard its contractual commitments to provide 
much needed water to the cities, farms, Indian reservations, 
and instead take that water for the needs of the fish. The 
Court found that the Government can use water imported from 
another basin for the silvery minnow in violation of New Mexico 
State law.
    Senators you know that the great Colorado River has been 
part of supplying water to all different States up and down its 
lengthy path, but it also supplied water to the State of New 
Mexico. The second-to-last agreement made by the Senate, when 
Senator Clinton Anderson was then the Senator from New Mexico, 
was to take some of that water, send it across the Rocky 
Mountains through a canal drilled through the mountain into 
this new environment for that water, the Rio Grade River.
    Obviously, since the fish existed before that water came 
in, the environment of the river for the fish and its 
protection was the river without that water, not the river with 
that water.
    Nonetheless, the closing remarks of the two judges seemed 
to me to almost be the writings of some young student, 
delighted with the idea that this river needed everybody and 
everything working and living together for it to be a livable 
river. As a consequence, it needed the water of that river to 
protect the fish.
    Of course, that whole thought is an error. From its 
inception, that river and that fish did not have that imported 
water. One of the very big mistakes made by the Court was to 
say that the imported water could, and must, in fact, be used 
as you put together the biological living conditions for the 
preservation of the fish.
    That is one of the issues that seems rather simple for a 
committee like this to address. Across the land, with reverence 
to rivers, to protect endangered species within a river basin, 
should you give water that is brought in for another purpose 
under another contract, and paid for in another way? Could you 
make that imported water also a part of the water that is to be 
used for the preservation of the fish?
    The Court said ``yes.'' The minority judge said ``no.'' The 
minority opinion is a very excellent opinion in this Senator's 
way of reading things. Maybe this dissenting judge is familiar 
with the Frankenstein monster. The dissenting judge equated the 
Endangered Species Act as it was applied in this Circuit to the 
Frankenstein monster that had gone wild, that just stomped 
around and took over things wherever it could lay it feet, 
taking all the contracts of the Bureau of Reclamation, 
regardless of their purpose, regardless of their tenure, and 
regardless of how long they existed. They said they are all 
subject to saving this fish.
    How did we get there? The Court interpreted the ESA, as I 
said, as preempting 75 years of existing water law, existing 
contracts, and the needs of the burgeoning population of 
Albuquerque and the surrounding area. The silvery minnow case 
began with a Section 7 consultation under ESA. The consultation 
for the minnow was triggered by litigation. In 1999, a group 
demanded that the Court direct the Bureau to consult with the 
Fish and Wildlife Service over the Bureau of Water and River 
Operations in the middle Rio Grande.
    Until that time the Federal agencies had not consulted the 
Bureau's operations. The middle Rio Grande, like most of the 
water in the West, is completed accounted for through water 
contracts, interstate compacts, and perfected water rights 
under State law.
    I think all of you understand that the hallmark of water 
rights in the West is certainty. That is why we have water 
rights law. People have to have certainty of obligation and of 
ownership. That is why water basins in States like New Mexico, 
believe it or not, are adjudicated. Up and down the river you 
decide who owns what, effective as of what time in history. To 
have any property value, it must have certainty. The whole goal 
and objective of this river basin is to inject certainty, not 
uncertainty, into the water rights of that basin.
    In my opinion, because the Bureau had no discretion to 
alter these water deliveries, a Section 7 consultation was not 
appropriate and should not have been ordered. Once the Fish and 
Wildlife Service produced a biological opinion in 2001, the 
litigation that began over Section 7 consultation was leveraged 
into a challenge to the biological opinion itself. Let me 
repeat that. The litigation began over a Section 7 consultation 
and was leveraged into a challenge to the biological opinion 
itself.
    The environmentalists argued that the Bureau failed to 
consult on a full range of alleged discretionary authority, 
even though the Bureau believed it had no discretion to take 
contractually obligated water, or the water resulting from 
inter-basin transfers. The Bureau had no discretion to do that. 
Indeed, the Bureau kept maintaining that, ``Since we do not 
have any discretion, why do we have to have such broad 
consultation.''
    The Section 7 consultation was next transformed into a 
court fight over an injunction sought by environmental groups. 
The case resulted in the district judge determining that the 
Bureau has the discretion under the ESA to take New Mexico's 
water as I have described it. The Tenth Circuit, in the divided 
opinion, did what I have just said. It would behoove you and 
your staff to read the opinions. They are not long. In 
particular, the opinion of the dissenting judge seems to me to 
be on that makes eminent sense upon which you might consult in 
terms of making some rational change to the ESA.
    I have been here long enough to have voted for the ESA. I 
came here in 1972. At tht time, I did not know very much about 
what I was voting on, but even I did, I probably would have 
voted for the ESA. It is a great sounding piece of legislation. 
Obviously, when you look at it, and look at the kind of people 
who were then sponsoring it, you would for vote it.
    Back then, you had people like Scoop Jackson proposing the 
ESA and proposing other environmental laws of the days. You 
usually would vote for them. That is not to say that those same 
senators sitting here today would agree with the laws that they 
passed. Nonetheless, they were giants who were trying to make 
some sense out of what could end up being a very 
environmentally confused part of our country.
    Did any of us who voted for the ESA intend for it to apply 
retroactively? I do not think so. Did any of us who voted for 
it intend that through the courts you could achieve super 
status to the point of abrogating pre-existing contracts as has 
happened here? I did not.
    Just remember, the water that came to the basin across 
those mountains and through those tunnels was no gift. Nobody 
gave that to us. That was paid for over a 40-year period of 
time at 4 percent interest by the city of Albuquerque and a 
number of units of governments. I missed by 1 year being the 
one who signed that contract for the city. I came into the seat 
that signed the contract the year after it was signed. But it 
was being finished up while I was then Chairman-Mayor. It was a 
huge indebtedness to bring water in. It was very clear. It was 
new water for a purpose, that is, the long-term protection of 
water needs of that valley. That is the valley that this court 
said was subject to take for the fish under the ESA.
    I am firmly convinced, as I have been in the past, that the 
law should be changed. But I am equally convinced that it is 
almost impossible to do that. Particularly in the West it seems 
to me that we must have laws that are prospective, not 
retroactive. We cannot particularly exist in a world where the 
statute is allowed to undermine water contracts, interstate 
compacts, water rights preferred under State law, and even 
treaties which have long governed river management.
    Four years after the Section 7 consultation litigation was 
brought, millions of dollars have been spent. The court case 
drags on. We are still in the position where we must request a 
rehearing in bank in the Tenth Circuit, and if necessary, ask 
the Supreme Court to consider it.
    In addition to countering the potential devastating impact 
of the Tenth Circuit, in particular on the imported water, 
which is the future of that area, I would be held derelict if I 
were not working with members of our delegation, and hopefully 
with all of you, on legislation to provide a balanced approach 
for that river basin, one that addresses both the needs of the 
people of my State, and the needs of the silvery minnow.
    I have that legislation written. It has been cleared by a 
number of lawyers. I will present it to you for your perusal. 
If you think it is correct, you can support us. We will attach 
it to some legislation here in the Senate. It is very simple. 
It merely says that the Endangered Species Act does not apply 
in the river basin. We describe it to the imported water which 
was brought there for other purposes.
    It continues to say that a biological opinion, which has 
been developed, should be implemented. Environmentalists do not 
like it and to them, we say, ``That shall be implemented.'' 
That biological opinion says that the river might run dry. It 
has to run dry because of the shortage of water, rather than to 
dump all the reservoirs to save the fish. The biological 
opinion is essentially the legislation that we will offer to 
one of the bills here on the floor.
    I thank you for listening. I wish you good luck.
    I would ask that my complete testimony be included in the 
record in its entirety.
    Senator Crapo. Without objection, so ordered.
    Thank you very much, Senator Dominici. We realize you have 
a committee to be to in about 5 minutes.
    The chairman wanted to make a quick statement.
    Senator Inhofe. Thank you, Mr. Chairman. I have to go down 
to Armed Services. I just want to respond, Senator Dominici, 
that in hearing about your legislation, I really believe it 
needs to go a little broader. There are other problems out 
there. I will share some stories with you.
    When I became chairman of this committee, I suggested 
something that was considered to be totally outrageous by some 
of the community out there, and that was that we base our 
decisions on sound science, that we have cost benefit analysis. 
Our chairman of the subcommittee, Senator Crapo, said in his 
opening remarks that he thinks we need to have common sense. I 
am sure they will consider that equally outrageous. We want to 
address these problems. We have a chairman of this subcommittee 
that is going to give the leadership necessary to make some 
changes.
    Thank you very much, Mr. Chairman.
    Senator Crapo. Thank you.
    Senator Dominici, thank you for spending your time with us 
today and in testifying to us.
    Senator Domenici. It was my pleasure.
    Thank you, Senator Murkowski.
    Senator Crapo. Senator Murkowski, would you like to make an 
opening statement?

OPENING STATEMENT OF HON. LISA MURKOWSKI, U.S. SENATOR FROM THE 
                        STATE OF ALASKA

    Senator Murkowski. I appreciate that, Mr. Chairman. Thank 
you.
    Mr. Chairman, it was interesting to hear the good Senator 
from New Mexico and his comments. I would concur with him that 
as we look to Section 7 and the consultation process, I would 
certainly concur that it needs work, and perhaps as much as 
major surgery.
    Typically when we hear those who will speak to the pros and 
cons of Section 7 and the consultation process, the focus is on 
experience with fresh water or terrestrial species, as Senator 
Dominici has indicated. But those are not the only areas where 
Section 7 comes into play.
    Alaska's fishing industry has recently had a very 
instructive encounter with the consultation process. I would 
like to summarize that for the record. Stellar sea lions are 
managed by the National Marine Fisheries Service. In 1975, the 
population in Alaska of the Stellar sea lions was estimated at 
more than 100,000 animals. By 1989, it had fallen to about 
25,000. In 1990, Stellars were listed as threatened. In 1993, 
critical habitat was designated. In 1997, the Western 
population in the Aleutian Islands was declared to be 
endangered.
    Under the Act, the status of the sea lion population 
triggered a Section 7 consultation to consider the effects of 
the fisheries. Since the fisheries are also managed by the 
National Marine Fisheries Service, this created the odd 
situation where the Agency responsible for the fisheries was 
consulting with itself over its responsibility for the marine 
mammals.
    From 1979 to 1998, NMFS repeated found that the fisheries 
did not adversely affect the sea lions. But that was not 
satisfactory to Greenpeace and other interests which then filed 
a lawsuit. After the lawsuit was filed, the Agency suddenly 
reversed its course and in late 1998, it issued a new 
biological opinion under Section 7 which, for the first time, 
found jeopardy for the Alaska pollock fishery.
    The finding was based on an untested theory, popular among 
the Agency's marine mammal scientists, which supposed that 
fishing could cause localized depletion of pollock or disturb 
the sea lion feeding pattern. Unfortunately it ignored most of 
the available science including evidence that largely 
exonerated fishing from blame for the sea lion decline, and 
demonstrated that sea lion stocks were healthiest when fishing 
activity was the heaviest.
    Despite that, it became the guiding principle for the 
Agency, and 5 years of court battles, to adopt reasonable and 
prudent alternatives which devastated whole communities 
depending on fishing, and spawning two more biological opinions 
in an attempt to get the issue back on a reasonably even 
scientific keel.
    What makes this case notable is not the outcome, but how 
badly the process itself was allowed to spin out of control, 
even though the National Marine Fisheries Service was the 
Agency conducting the action. Evidence that indicated fisheries 
were unlikely to harm sea lions was largely ignored. In 1989, 
in 1994, and yet again in 1996, research by scientists looking 
for a link between the pollock fishing and the sea lion decline 
had failed to yield the expected results.
    Although the declines were found in some areas of heavy 
fishing, there were also sharp declines in areas with little or 
no fishing. Other scientists, publishing in 1991 and 1992, 
questioned the supposed link more directly. A 1991 paper by two 
of NMFS' top fisheries scientists actually seemed to indicate 
that there is an inverse relationship between pollock and sea 
lions. In fact, more recent work may even suggest that 
attempting to ensure less fishing and more pollock may have 
been the worst thing to do because a pollock diet is less 
nutritious than one that includes fish of other species.
    The failure of process in this case is that such a deeply 
questionable document as the 1998 biological was accepted as 
gospel. Those responsible for overseeing the work failed to 
ensure that it was either justified or complete before it was 
accepted. Those who attempted to provide prospective on it were 
shut out of the process. Worst of all, once such an error has 
been made, it may take many years and many dollars before it 
can be overturned.
    Mr. Chairman, natural resource managers sometimes use the 
term ``precautionary principle'' to describe a better safe than 
sorry approach to management. It should describe a reasonable 
effort to ensure that all information is considered and 
reasonable precautions are taken where there is uncertainty. It 
should not be an excuse for catering to the preconceived notion 
of one interest over another. The Section 7 process should be 
emblematic of the precautionary principle at its best, not at 
its worst.
    Finally, let me note that the National Marine Fisheries 
Service, since the events I have described about the Stellar 
sea lions, has made a significant effort to improve its 
practices and prevent such abuses. That is laudable. However, 
these efforts have been voluntary. The fact is that the 
potential for abuse remains inherent in the statute as it is 
currently written.
    Conservation of species demands sound, objective science 
that examines all sides of an issue, not a subjective approach 
that caters to preconceived notions. To the extent that the law 
allows the latter to occur, it is at fault, and change is 
needed.
    Mr. Chairman, I would ask that a paper written by Dr. 
Dayton L. Alberson on the Stellar sea lion and pollock 
basically outlining the science behind it, be included in the 
record for others to review.
    Senator Crapo. Without objection, so ordered.
    Senator Murkowski. I thank the chairman for bringing this 
to the attention of the subcommittee, and for your work on this 
very important issue.
    Senator Crapo. Thank you. We appreciate your attention and 
concern about this issue as well.
    We will now proceed to the second panel. Mr. Barry Hill, 
Director, natural Resources and Environment, U.S. General 
Accounting Office. I understand, Mr. Hill, that you are 
accompanied Ms. McClure.
    You may proceed.

   STATEMENT OF BARRY HILL, DIRECTOR, NATURAL RESOURCES AND 
  ENVIRONMENT, U.S. GENERAL ACCOUNTING OFFICE ACCOMPANIED BY: 
 TRISH MC CLURE, DEPUTY DIRECTOR, OFFICE OF NATURAL RESOURCES 
        AND ENVIRONMENT, U.S. GENERAL ACCOUNTING OFFICE

    Mr. Hill. Thank you, Mr. Chairman, and members of the 
subcommittee.
    Before I begin, let me explain that Trish McClure, who is 
with me today, was responsible for basically leading and 
managing the work that we will be presenting today in our 
testimony. I will briefly summarize my prepared statement.
    We are pleased to be here today to discuss the preliminary 
results of our ongoing review of the consultation process 
required by the Endangered Species Act. As you requested, we 
focused on the processes that applied in the Pacific Northwest.
    Under the Endangered Species Act, before Federal agencies 
may conduct, permit, or fund activities of the areas where 
threatened or endangered species may be present, the agencies 
must consult with the Fish and Wildlife Service or the National 
Marine Fisheries Service. The consultation is intended to 
ensure that Federal agency activities will not jeopardize the 
continued existence of any listed species or destroy or 
adversely modify habitat designated as critical for those 
species.
    In the Pacific Northwest, the types of activities agencies 
may need to consult on include maintaining wilderness trails in 
national forests, dredging navigational channels, and operating 
hydroelectric dams. The Federal agencies responsible for 
consulting on such activities are called ``action agencies.'' 
The four action agencies included in our review were the Army 
Corps of Engineers, the Bureau of Land Management, the Bureau 
of Reclamation, and the Forest Service.
    Action agencies must also consult on various activities for 
which they issue permits, licenses, or Federal funds to non-
Federal parties. These activities include livestock raising, 
timber harvesting, and mining on Federal lands, and building 
structures such as piers and docks on private property.
    The consultation process can be short or long, as 
illustrated by the graphic that we have displayed here to my 
left on the presentation board. If an action agency determines 
that a proposed activity may affect a listed species, the 
Agency may initiate either an informal or a formal consultation 
with one or more, or both of the services. An informal 
consultation, which could be as simple as a brief telephone 
call, the Service and action agencies agree that the activity 
is unlikely to harm the species, and that formal consultation 
is not necessary.
    On the other hand, if the Agency or the Service believes 
that the activity may be harmful, the action agency initiates a 
formal consultation by submitting a biological assessment of 
the activity and its potential effects. If harm appears likely 
and formal consultation is required, the Service has 135 days, 
by regulation, to formally consult and document, in a 
biological opinion, whether the activity could jeopardize the 
species' continued existence.
    It is important to keep in mind that even under normal 
workload conditions, the consultation process can be difficult. 
In part, this is because decisions about how species will be 
protected must often be based on uncertain scientific 
information and on professional judgment. It is also because 
Federal agencies and the Services must strive to reach a 
balance between ensuring that action agencies are able to 
fulfill their missions while protecting threatened and 
endangered species.
    My testimony today will present the preliminary results of 
two topics. First, key efforts to improve the consultation 
process in the three States we reviewed, and second, key 
concerns with the consultation process as identified by the 
Services, other Federal agencies, and non-Federal parties.
    We anticipate issuing our final report in late August, and 
in that report we will be presenting additional information on 
concerns about and improvements to the consultation process, 
Service and Agency officials perspectives on the effectiveness 
of the improvements, and information on the adequacy of agency 
data bases that contain key information on individual 
consultations.
    Let me turn to the first issue of my testimony on efforts 
to improve the consultation process. In response to concerns 
that largely stem from several fish listings in the late 
1990's, the Services in the Pacific Northwest have taken a 
number of steps to improve the consultation process. For 
example, both Services have increased their staff levels in 
certain offices to help address workload backlogs. The National 
Marine Fisheries Service established new offices to facilitate 
consultations at remote locations.
    Also, to improve efficiency, the Services have increased 
their use of consultations that address multiple activities. 
These consultations are often referred to as programmatics, and 
minimize the need to consult on individual activities. For 
example, one consultation in Western Oregon covers ten types of 
routine activities in two national forests and two BLM 
districts.
    Another efficiency improvement, called streamlining, uses 
interagency teams made up of Service and action agency 
personnel that work together on multiple projects. The intent 
is that by working collaboratively these teams will more 
quickly reach agreement on the potential effects of a project, 
and will resolve problems that arise.
    Finally, the Services and the action agencies have worked 
both individually and together to develop and refine guidance 
and training for staff conducting consultations. Interagency 
efforts include refresher training on the streamlining process, 
and development of websites that provide staff with preparation 
instructions for, and examples of, biological assessments and 
other key consultation documents.
    Despite these and other improvement efforts, officials at 
the Services and action agencies, as well as non-Federal 
parties, continue to have concerns about the consultation 
process. A key problem that lengthens the process is that the 
Services and action agencies do not have a shared understanding 
of what constitutes a complete biological assessment. This 
leads to repeated requests by the Services for additional 
information from the action agencies until the Services are 
satisfied that the assessment adequately addresses the effects 
of the proposed action on the species.
    If you will refer to the presentation board, you will see 
in the middle of the board the dotted line that represents this 
cycle of information request by the Services. You will also 
notice that this cycle occurs before the official consultation 
time clock begins, either 30 days for an informal consultation 
or 135 days for a formal one.
    By this time, however, related activities, such as 
requesting and providing additional information may have been 
ongoing for quite a while. Repeated requests for information 
can also be caused by Service biologists being unfamiliar with 
action agency programs. High turnover among Service biologists 
is one factor that contributes to this problem.
    In addition, the fear of litigation can also impact the 
length of the process; that is, action agencies and Service 
officials said they sometimes try to bulletproof biological 
assessments, or make them so comprehensive that they will be 
immune from legal challenge. This adds to the time and cost of 
consultation.
    Action agency officials also expressed concern that Service 
and action agency roles are not clearly defined. Some action 
agency officials told us that Service biologists sometime 
recommend changes to Agency's proposed activities beyond what 
action agencies think is necessary to minimize the negative 
effects on species.
    In response, Service officials say that the purpose of the 
consultation process is to discuss the potential effects of 
proposed actions early in the planning process and to explore 
options that will avoid jeopardy.
    Service and action agency officials also identified a lack 
of sufficient resources, particularly at the Services, as a key 
concern. They said that the staff level increases have not kept 
pace with their growing work loads.
    Among the non-Federal parties, permanent applications 
express concerns about the time and expense required for the 
consultation process. For example, the average permit 
processing time for 19 permits issued in 2002 for building 
private docks, or for similar activities on Lake Washington 
near Seattle, was more than 2 years, and added about $10,000 to 
applicants' costs.
    Finally, environmental advocacy groups expressed concern 
that the consultation process, like other land management 
decisionmaking processes, is closed to them until decisions are 
final. Accordingly, they feel that their only avenues for 
voicing their concerns are through administrative appeals and 
lawsuits.
    In conclusion, Mr. Chairman, may I say that everyone 
involved in this process is supportive of the goals and the 
intent of the Endangered Species Act. All would agree that 
consultations are a key component of this process. Continued 
efforts must be made by the Services and the action agencies to 
find more and better process, effectiveness, and efficiency 
improvements for consultations that help achieve the proper 
balance between action agencies being able to fulfill their 
missions, while protecting threatened and endangered species.
    Mr. Chairman, that concludes my statement. We would be 
happy to answer any questions that you or any other members may 
have. I would ask that my complete testimony be included in the 
record in its entirety.
    Senator Crapo. Without objection, so ordered.
    Thank you very much, Mr. Hill.
    The first question I have relates to the time lines that 
you show at the top of your chart. Could you go over again with 
me just what the language is in the statute or the regulations 
that establishes these time lines?
    Ms. McClure. The only statutory timeframe is for formal 
consultation. That is 135 days for the entire process. The 
Service policy to deal with informal consultations is 30 days. 
But both of those clocks start ticking once the Services decide 
that they have enough information from the action agency to 
determine whether the activity will have an effect on species 
or its habitat.
    Senator Crapo. It is that point that I wanted to go into. 
The Service gets to decide when the clock starts going. Is that 
something that is in regulation or in statute, or is that just 
a procedure that the Services has adopted?
    Ms. McClure. It is a procedure that the Services have 
adopted to implement the statute.
    Senator Crapo. The statute contains the time deadlines that 
we talked about. The reason I go into that is because I 
certainly cannot say what was in the mind of those who wrote 
and voted for the statute, but it would seem to me that they 
had an idea in mind that there would be a deadline. If the 
timing of the deadline does not begin until the Agency 
performing the consultation decides that it will begin, then it 
appears to me that we have a problem from the git-go with 
regard to establishing some kind of a timeframe within which we 
must operate.
    Would you like to comment on that?
    Mr. Hill. Well, I think what you are saying is true. But 
just to provide some balance to this, I believe the controversy 
is occurring over whether or not the biological assessment is 
complete. That is a key point. That clock cannot start ticking 
until that assessment, in the eyes of the Service agencies, is 
complete. I think you have to be careful here in terms if you 
expedite that process, already there are concerns about the 
lack of scientific data and information that is being used to 
come up with these biological assessments.
    There has to be a balance here to make sure that the action 
agencies are doing a good job on those biological assessments 
in using the best available data that they have and doing that 
in a way that can be done a little quicker and more streamline. 
In that way, you can get to the point where you have a 
biological assessment that is ready to go into this formal or 
informal process.
    Senator Crapo. This is not a new problem. It comes up in 
other contexts. I first ran across this before I became a 
Member of Congress when I was working on permitting processes 
and the like. There were time lines for applicants for 
environmental permits, but the time lines never start running 
until something is decided by an Agency. That something is 
never decided by the Agency, or decided months, if not years, 
after the process is begun.
    When I evaluated it at that time, it became evident that if 
you were to put an actual firm deadline on the Agency, then 
what they would simply do would be just to deny the permit and 
say. ``We do not have enough information; so we cannot approve 
it. You can make your application again. We will deny it again. 
You can make it again and we will deny it again until we feel 
like we are ready to grant it.''
    The argument being made was, and always is, that we do not 
have enough information to adequately evaluate the permit. It 
is a serious problem. You raise a valid point.
    The question I have is this. This is a creative thinking 
question. How can we address this problem? If we want to find 
some way to put some time parameters on the actions that we 
require of our agencies--not just in the environmental arena, 
but in any arena--how can we approach it? Have you given that 
any thought?
    Mr. Hill. We are auditors by nature. We look for data. We 
look for evaluations. That is what is lacking here. No one 
really has any good information as to how long this entire 
process actually takes, or why it is taking so long. There is 
not a lot of data out there that really indicates when the 
initial contact is made to the Service agencies in terms of an 
action agency coming in and saying, ``I have a project. I want 
to talk with you about it and enter into these informal 
consultations.''
    There is not a lot of data out there that really indicates 
just how long that process takes. You hear the horror tales now 
and then, but we do not know how prevalent that is. More 
importantly, without that kind of data and without that kind of 
evaluative information, you really do not know what is broken 
in that front end. That is where I think there could be some 
gains made in terms of shortening that front-end process, that 
once the clock starts ticking, that is a pretty set timeframe.
    Senator Crapo. We hear the horror stories, but that we 
really do not know how prevalent that is. In terms of the 
analysis that you made in focusing on the Northwest, do we get 
a feel there out of the data that we studied there as to how 
prevalent these long delays and problems are?
    Ms. McClure. We have some data on that which we are still 
analyzing. The problem is that some of the data bases that the 
Services maintain do not capture key points in time that you 
would need to evaluate how long the process is. We did gather 
data from service and action agency officials that can speak to 
the process of how it has changed over time.
    In terms of consultations in the 1998 and 1999 timeframe, 
we have heard a lot of concerns through 2002, where they have 
had the benefit of some of these improvement efforts, like 
programmatics and streamlining. Folks do indicate that the 
timeliness has improved as a result of some of the improvement 
efforts. We will get into that in more detail in our full 
report.
    Senator Crapo. You heard my opening statement in which I 
referred to a memo that was sent by the then regional forester, 
Jack Blackwell, where he indicated that he could not adequately 
convey the level of frustration, anxiety, and feelings of 
helplessness that were occurring within the Forest Service at 
that point, in terms of trying to work through the consultation 
process.
    In a follow up memo, he was reporting back to the Chief on 
some of the information that they were trying to glean as they 
tried to implement these streamlining processes that you have 
talked about. From the tenure of that memo, I get the feeling 
that, at least in this context, it was not felt that there had 
been a lot of success.
    One of his examples was that he reports what some of his 
people are reporting to him. He says in other forest reports 
that ``The streamlined consultation is an oxymoron. This 
forester says the terms implies a fast, or at least a faster 
approach to what existed previously. They say the current 
process was developed because we had reached gridlock in 
consultation.''
    I guess if we have improvement over gridlock, that is good. 
What I am getting at and what I am hearing you say is that we 
do not have enough data to answer the question. How broad based 
is this frustration? Are the streamlining processes working? 
Are we talking about a limited number of horror stories? Are we 
talking about a pervasive problem that is causing the agencies 
to approach gridlock?
    Do you have any further response to that?
    Ms. McClure. In the three States that we looked at, as you 
know, the Forest Service and the BLM are the only action 
agencies that do streamlining. The vast majority of the 
individuals we spoke with in those Agencies, and the Services 
that service those agencies, felt that streamlining was working 
well and was improving how consultations were working.
    There was one exception in Idaho were things were not 
working well. The individuals we spoke with seemed to think 
that the problem was personality driven, and that the process 
was not being implemented as it should be. There is a process 
of the ground level biologists who serve on what are called 
Level I teams. They are really the ones who do the grunt work 
and try to make the decisions and work through issues.
    When they cannot resolve issues amongst themselves and they 
cannot proceed with projects, they are to elevate that to their 
managers, to what is called a Level II team. That was not 
happening. You did have projects that were gridlocked.
    Senator Crapo. That is exactly what is further referenced 
in this memo. When you said there was one problem in Idaho, was 
Idaho the problem or part of Idaho was the problem?
    Ms. McClure. A part of Idaho was the problem.
    Senator Crapo. OK. One of the things that was mentioned in 
this memo was the point you just raised, and that is that there 
was a reluctance or a failure to elevate this from Level I 
further up the chain, for various reasons. The speculation is 
that people did not want to admit that it was not working, or 
that there was a concern that there may be some retribution or 
something like that, if they were to elevate the decision.
    Is it your understanding that this particular problem is 
not pervasive?
    Ms. McClure. There does not appear to be gridlocked 
consultations like there is in this one location in Idaho. We 
did hear from other individuals involved in the streamlining 
process, though, that there is some hesitancy to elevate issues 
to managers. There is that fear that, ``This is not working and 
we failed.'' There is some level of concern in other offices, 
but it is not gridlocking the process.
    Senator Crapo. There is something about this consultation 
process that is out there that is causing an element of 
concern. This is not the first time this committee has 
addressed this issue. I am told that in the past they were not 
able to get enough witnesses willing to come forward to talk 
about it so that they could hold a full hearing. In terms of 
getting this hearing put together today, there are a lot of 
people that did not want to talk.
    I am assuming that this is in the public section. These are 
people who have a consultation on a project they are involved 
with and who do not want to be irritating anyone at the Agency 
who may be evaluating their projects by saying what their 
frustrations are with the project. I am assuming that is the 
kind of dynamic that we are dealing with.
    I can tell you that we had to go through a tremendous 
amount of effort to get people who were willing to come forward 
and talk with us today. I am a little worried because of that, 
that perhaps we are not getting a full story about what is 
happening in terms of the implementation of this. I am assuming 
that you are continuing to evaluate this. I would encourage you 
to keep that in mind and perhaps be prepared to evaluate that 
aspect of this with us, if you can get a feel for it as you 
conduct your analysis.
    Mr. Hill, aside from the significant increases in the 
number of listed species, which is obviously going to increase 
the number of consultations, are there other reasons why the 
consultations have increased over the past few years; do you 
know?
    Mr. Hill. Well, the listing, particularly in the Pacific 
Northwest, is a major factor. You have a number of species 
listed in the late 1990's that have habitat areas that are so 
far reaching that just about any activity you are going to be 
doing there that is close to the rivers and steams, is going to 
be examined closely. That was a significant factor.
    Another factor certainly is the fear of litigation. There 
is a lot of concern, quite frankly. There has been a lot of 
litigation and there has been a lot of court decisions. If you 
look back in time, I believe the action agencies in the past 
had more of an inclination to basically look at their proposed 
action and determine that t would not have a negative effect. 
They would then go ahead without even having a consultation.
    Now, because of the litigation that is occurring, I think 
there is more of an inclination to play it safe. If they make 
that determination, there is no effect and it is later found 
out to have an effect, they are responsible. They are liable 
for that action.
    Senator Crapo. Are they personally liable for that; do you 
know?
    Ms. McClure. Personally, or as an Agency?
    Senator Crapo. Personally.
    Ms. McClure. I am not clear on that. We could check on 
that.
    Senator Crapo. If you would, I would appreciate that.
    Without objection, so ordered.
    Senator Crapo. Go ahead.
    Mr. Hill. In order to play it safe, I think right now what 
you have is, because of the fear of litigation, that they are 
going to go through this consultation process and consult with 
the Service agencies. At that point, the liability shifts from 
them to the Service agencies. So I think you are seeing more of 
an increase in consultations from that standpoint as well. It 
is also adding to the problem of the nature, size, and risk of 
the projects that are coming into the system. There are many 
more ``low risk'' types of projects that are going through 
consultations than the major actions that I think you were 
seeing earlier on.
    Senator Crapo. Tell me a little bit about what qualifies as 
an action, or whatever the proper term is, that then has to be 
evaluated?
    Ms. McClure. Virtually anything. Any proposed action, even 
a beneficial action, the action agency has to decide whether it 
may harm, or jeopardize the continued existence, or adversely 
modify its critical habitat.
    Senator Crapo. I know that you used examples in your 
testimony of construction of docks on private property, or the 
like. In the materials I have here, I have things such as 
grazing, road or trail maintenance, fire suppression, 
recreation projects, and noxious weed treatment. They even have 
firewood and Christmas tree cutting.
    When I look at the statistics of 14,004 consultations just 
in this one region, of which 13,141 were considered to be in 
the category of discountable, insignificant, or completely 
beneficial. Are we getting to the point where we are throwing 
the net too broadly, that we are creating too broad a focus and 
diverting resources away from what could be a more beneficial 
use of these dollars and personnel in terms of species 
protection?
    Mr. Hill. That is a hard question to answer. Here again, 
there is not a lot of good data and information to base that 
on. There is not a lot of information in terms of the benefits 
of this consultation process. The purpose of the process is to 
sit down early and discuss the particular project, to explore 
options or whatever, and to basically avoid the jeopardy, the 
negative effects. To the extent that that is occurring, because 
of the consultations, we really do not have a good handle to 
what extent that is happening.
    Senator Crapo. That really is the core question.
    Mr. Hill. Right. That is the kind of information that I 
think needs to be collected. Where do you have instances where 
the consultation had a happy ending, a positive effect here, 
and that we were able to avoid some type of negative action 
because we had an early consultation and we were able to work 
it out before this project got too far?
    Senator Crapo. Are you evaluating that question as you 
continue your study?
    Mr. Hill. Here again, there is really no data to go out 
there. I do not believe that we are going to be able to capture 
that in the work that we are doing.
    Ms. McClure. We can capture the amount of information that 
is out there and what is being done, but we will not be 
speaking to the benefits of the process.
    Senator Crapo. As you are aware, I am sure, this committee 
is also looking at the problems that we face in designating 
critical habitat. It was the Fish and Wildlife Service that 
said that they were out of money and that they do not do the 
critical habitat designations anymore. I see a statistic here 
that the number of personnel doing consultations in the NMFS in 
the Northwest Region, went from six to 120.
    I am thinking about where we are putting our resources in 
endangered species protection. I am wondering if there any way 
for us to construct a study that would enable us to answer this 
core question. If the consultation process, as voluminous as it 
is, is making us much better at avoiding harmful impacts to 
species, then there is a benefit there.
    If instead it is causing us to spend significant resources 
evaluating whether a dock can be built on private property, or 
whether a Christmas tree can be cut, after it has been 
evaluated by the personnel managing it, then I have a hard time 
justifying that kind of extensive utilization of resource, when 
we could be utilizing resources in other parts of the Agency.
    I think you have answered this, but I want to ask this 
again. Is there a way that we could construct a study to get at 
that question?
    Ms. McClure. You would have to look at the benefits. You 
would have to get into the benefits. I think you would also 
need to address the legal vulnerabilities, or the legal 
authorities and requirements under the Act. I think the Senator 
raised the issue this morning that we did not know it would go 
this far and wide when we signed the Act back in 1973.
    I think there are several different pieces of analysis that 
need to be done that could certainly get us closer to where we 
are right now in answering that question.
    Senator Crapo. Thank you very much.
    In Idaho, I am told that we are now facing a situation 
where just the time line that we are talking about here, is 
getting drawn out for all the reasons you talked about. We hear 
about the litigation aspect of it a lot. That time line is 
interfering with projects that are going to have a very 
beneficial impact if we can just proceed with them; for 
example, reconnecting stream channels that have become 
disconnected and impeding fish passage and migration and 
rewatering streams that have become dewatered.
    One of the concerns that I have is that we are losing 
opportunities to put our resources where they count and to 
engage in activities that will enable us to improve 
circumstances for species.
    That is not really a question. It is just a commentary of 
the frustration that we are facing here as we look at some of 
these statistics.
    Mr. Hill. If I could interject, we did some work last year 
on the Columbia River Basin salmon and steelhead. We ran into 
that situation with regard to some of the projects that the 
Forest Service was trying to do, particularly culvert 
replacement. Some of this work is very seasonal. It can only be 
done during certain times of the year because of the weather or 
because of the spawning habits of the fish.
    They raised that as a problem in terms of their inability 
to get these culvert projects approved within a timely way. 
They were delayed to the point where they missed their window 
of opportunity to do the work. Here again, it was a beneficial 
project. They are trying to open up the fish passages, 
basically, by replacing these culverts. They missed their 
window of opportunity. The project basically slid for a year, 
and in some cases it was 1-year money. They lost the money, and 
in essence, they had to go back to the drawing board.
    It can have some significant effects if this thing is not 
done in a timely way for some projects.
    Senator Crapo. I appreciate your making that point. Again, 
we run into this constantly. It happens whether it is in terms 
of forest management, water management, fish issues, forestry 
issues, or the like. Often in the Northwest we have a very 
limited timeframe within which we can operate, as you 
indicated. A couple of months of delay can result in a year's 
lost time. That is one of the reasons that we are talking about 
this.
    Let me ask one other question and then I will turn to our 
chairman for his questions.
    Have you looked at the question of whether we are requiring 
the same amount of documentation and consultation for small 
projects, or projects that are considered not to have 
significant impacts, as we are for larger projects and those 
which have significant potential impacts? In other words, are 
we requiring the full load for every kind of project?
    Ms. McClure. I do not know if it is a equal load, but 
certainly we heard concerns, again going back to the fear of 
litigation, that even for simple projects the amount of 
documentation required on the part of the action agency is 
increasing and can be fairly significant.
    But most officials we talked with said it went back to this 
fear of litigation, that even on the part of the action 
agencies, that they feel compelled to bulletproof, or feel 
ensured that they have covered all of their bases, that they 
would be immune from a legal attack.
    Senator Crapo. In this memo, I want to find out how broadly 
the facts in this memo apply, but one of the points that was 
made in here is that as a result of what you have just 
described in that effort to try to bulletproof things, and 
protect against liability or responsibility for any problems, 
that our personnel are now spending more time in the office 
than they are in the field.
    Again, it gets back to the point that I have made several 
times and that is, are our resources being applied as 
effectively as they should be in terms of the management of our 
resources and the protection of species.
    Mr. Chairman, do you have questions?
    Senator Inhofe. Mr. Chairman, I do not. While I was 
attending the Armed Services Committee hearing, I am sure that 
anything I would ask would be redundant of what you have 
already asked. I notice that we have a sizable third panel.
    I have no questions.
    Senator Crapo. All right. Thank you very much.
    In light of the time constraints under which we are 
operating, I am going to excuse you. Again, I am hopeful that 
we will be able to continue this discussion, as you continue 
your evaluation. Ultimately, I hope you come back with an 
answer to that $64,000 question that we identified together 
here, and that we can find a way to evaluate whether this is 
actually doing its job and being worthwhile, or whether we are 
diverting resources in a very significant way away from species 
protection. Thank you very much.
    I would like to call our third panel now. Please come 
forward as I am introducing you. Our first panelist is Alan 
Glen, Counsel, Smith Robertson, Elliott, and Glen; John 
Kostyack, Senior Counsel; National Wildlife Federation; 
Patricia Horn, Vice President and General Counsel, OGE Enogex 
Incorporated; Jim Chilton, Arizona rancher, on behalf of the 
Public Lands Council and the National Cattlemen's Beef 
Association; and William Snape, Vice President and Chief 
Counsel, Defenders of Wildlife.
    We have had some of you with us before. We appreciate your 
coming back again. For those who are here for your first time, 
we appreciate your being here.
    Let me lay down the one big ground rule. That is, follow 
the clock. We do have your written testimony. We have reviewed 
your written testimony. It will be a part of the record. We do 
ask you to summarize what you have to say in the 5 minutes 
which will be allocated to each of you so that we will have 
time to engage with you in dialog and some questions.
    I always remind the witnesses of this. I am confident that 
when your 5 minutes is up, you will not be done saying what you 
want to say. I would ask you to wrap it up at 5 minutes. If you 
tend to go a little longer, I will rap the gavel here just to 
remind you.
    You will have an opportunity in the questions and answers 
to get a part of the rest of what you want to say. We will give 
you an opportunity to supplement the record if you feel you 
really did not get to say everything.
    With that, let us proceed.
    Mr. Glen, you are first.

STATEMENT OF ALAN M. GLEN, COUNSEL, SMITH, ROBERTSON, ELLIOTT, 
                            AND GLEN

    Mr. Glen. Thank you, Mr. Chairman, and Senator Inhofe.
    My name is Alan Glen. I am a private lawyer from Austin, 
Texas. Much of my work is in the Endangered Species Act field, 
and a much of my time is spent representing clients through the 
consultation process. Most of my clients are in industry. I 
also represent a number of local governments, including cities, 
counties, and school districts.
    Mr. Chairman, I am going to echo some of the concerns that 
you raised in your opening remarks in three areas of the 
consultation process. I will mention that I do think the 
consultation process can be efficient and can be beneficial, 
although it often is not.
    Since my testimony focuses on problems, I will mention 
briefly two laudatory examples that I have been involved with. 
One was for Williamson County, Texas, where a very efficient 
consultation process resulted in the approval of a road 
program. The other was for a school district where a 
desperately needed high school got through the consultation 
process in record time and was able to go forward.
    Unfortunately, problems do remain. I will touch on three 
specific areas.
    First, there seems to be a trend toward the lowering of the 
threshold for consultation, in other words, the trigger point 
that leads to consultation. This trend is occurring not only on 
a case-by-case basis, but by broad actions by the agencies that 
tend to pull numerous projects and activities into consultation 
that in my view should not otherwise be there.
    I provide in my testimony two examples of that. The most 
notable and current is the cactus ferruginous pygmy owl 
guidelines that are applicable in Southern Arizona. These were 
consultation guidelines adopted as a result of litigation by 
the Corps and the Fish and Wildlife Service. They have the 
effect of lowering to an infinitesimal small level the 
threshold for consultation. This means that we are going to get 
exactly what you talked about in your opening remarks--the 
thousands of consultations on projects that will cause a lot of 
time, a lot of money, and with very, very little conservation 
benefit for that consultation.
    There were a similar set of guidelines adopted in Austin 
relative to the Edwards A Aquifer and the Barton Springs 
salamander. We have litigated those on behalf of the National 
Homebuilders Association, and reached a settlement by which 
they were withdrawn.
    Next, I will mention the issue of delay. I will observe 
that there are good Federal regulations under the Fish and 
Wildlife Service relative to what the information standards are 
to trigger consultation. In my experience, though, those 
regulations are often not followed. By the way, the cite, I 
believe, is 50 C.F.R. 402.14(c), which lays out what is 
required to initiate consultation.
    In my experience, the lengthy delays are oftentimes 
associated with the Agency wanting much more information than 
is achievable or obtainable during the 135 day consultation 
time clock. Unfortunately, the regulations specifically 
disallow the Agency to require surveys beyond the timeframe 
allowed.
    What tends to happen in practice, though, is that the 
Agency starts to sell time. There are quite explicit trades 
where we will let you out of this process in 30 days if you add 
to your project these things. The Agency in some instances has 
called this an alternative process by which you pay mitigation 
in order to get a quicker turnaway. This mitigation, in my 
view, is often at the end of the day not justified under the 
law or the applicable science. It sets up a mechanism by which 
the Agency is extracting merely for the speed of processing.
    Last, I will mention the utilization of draft jeopardy 
opinions. The statistics are good. There are thousands of 
consultations and very few jeopardy opinions. In my personal 
experience I have seen a number of actual draft jeopardy 
opinions. I cover two of those in my written testimony. I have 
been threatened to receive many of those.
    The impact of that and other things that happen earlier in 
the consultation process, cannot be reflected in the 
statistics, but it is very significant. There are projects that 
make enormous concessions along the way and spend an enormous 
amount of time and money doing the scientific research, and 
then ultimately receive non-jeopardy opinions. The statistics 
of what that cost and what that involved is not reflected in 
the statistics that can be gathered by the GAO.
    With that, I will conclude my remarks. I would ask that my 
complete testimony be included in the record in its entirety.
    Senator Crapo. Without objection, so ordered. Thank you 
very much, Mr. Glen. Mr. Kostyack?

 STATEMENT OF JOHN KOSTYACK, SENIOR COUNSEL, NATIONAL WILDLIFE 
                           FEDERATION

    Mr. Kostyack. Good morning, Senator Crapo and Senator 
Inhofe.
    Thank you for the opportunity to testify.
    I would like to make three observations based upon our 30 
years of experience with Section 7 of the ESA, and my 10 years 
of experience working with this provision. I would like to also 
provide three recommendations for the future.
    First, the big picture question: Is it worth all the 
trouble? There has been a lot of discussion that there is a lot 
of time and delay associated with Section 7, and unclear 
benefits. My organization's experience, and the commonly held 
view of people I work with in the conservation community and 
the scientific world is that there are immense benefits.
    Section 7 provides a crucial opportunity for the Government 
to look before it leaps into potentially harmful activities. It 
accomplishes a great deal for species conservation, despite a 
modest investment in resources. We would say that any reduction 
in conservation activities would be at the expense of listed 
species.
    I can give you a long list of examples and places around 
the country today where Section 7 is the key driver behind long 
overdue conservation actions, from the Klamath Basin, to the 
Missouri, and to the Rio Grande. There are many ecosystems 
where fish, wildlife, and plant species are at the brink of 
extension.
    Without the Endangered Species Act, Section 7 provisions, 
the species there such as the coho salmon of the Klamath, and 
the pallid sturgeon and piping plover on the Missouri, and the 
silvery minnow on the Rio Grande would have no hope.
    The second observation I would like to make is that we get 
these benefits from Section 7 regardless of whether jeopardy or 
adverse modification is found. In fact, the vast percentage of 
consultations go forward with the Agencies sitting down, 
working collaboratively.
    We want to avoid, if possible, jeopardy and adverse 
modification findings. That means that the process has broken 
down. The general story and the history of the Endangered 
Species Act is that these solutions are worked out in a 
collaborative sense, win-win solutions result, and projects 
move forward after adjustments are made to avoid unnecessary 
harm to fish, wildlife, and plant species.
    This should not be characterized as a failure of the Act. 
You can go across the country for examples of these win-win 
solutions. I have listed a number of them in my testimony. I 
will give one right now.
    If you go down Alligator Alley in Southern Florida, you can 
see the wildlife underpasses beneath I-75. That was the result 
of a Section 7 consultation concerning the endangered Florida 
panther. As a result, we have avoided unnecessary vehicle 
collisions with the panther, the No. 1 cause of panther 
mortality. That project went forward fairly smoothly, while 
having this immense benefit for a critically endangered 
species.
    The third observation I would like to make is that the vast 
majority of ESA consultations are streamlined. There have been 
many suggestions that people are being burdened with extensive 
delays and paperwork. But if you look at the record, roughly 97 
percent of Fish and Wildlife Service consultations between 1996 
and 2002, were resolved informally.
    An informal consultation, as a general proposition, means a 
single phone call or a single letter. I have seen many of these 
concurrence letters written by the Agencies. They are 
essentially one paragraph long. They do not entail many 
resources at all.
    Yet, we can receive significant conservation benefits from 
these informal consultations when both the wildlife agency and 
the action agency agree to make project modifications to reach 
this ``no adverse effect'' finding.
    Let me turn to my three recommendations very quickly. 
First, we really truly need a formalized program for tracking 
the Section 7 process. The only way to systematically evaluate 
the performance of Section 7, and to ensure that this key part 
of the law works as effectively as possible, is to have a 
rigorous monitoring program.
    Right now there is little systematic collection of data. 
Virtually all the information we have heard is anecdotal, or we 
gather statistics that are not necessarily very meaningful, 
such as how many no-jeopardy or jeopardy determinations have 
been made. That really does not tell the story of what kind of 
conservation outcomes we are receiving.
    Looking simply at the pieces of paper that result from 
consultation alone will not be enough either. You need to 
follow through on the outcomes of these consultations to see 
whether these conservation measures are truly being 
implemented, and what have been the barriers to implementation. 
All of this data should be collected in a systematic fashion 
and it should be posted on the internet for public review, 
debate, and discussion.
    The second recommendation is that we really and truly need 
to provide better funding to enable these wildlife agencies to 
respond to their ever-increasing workload. We have heard a lot 
about delays which is a legitimate concern. We really need to 
get to the heart of the problem, and that is inadequate 
staffing and funding of the Agencies. In addition to reducing 
delay, this also ensures that the Agencies have better ability 
to marshall the best available science.
    There have been ESA funding increases in recent years and 
they have been significant in terms of percentages. But if you 
look at the rate of increase in the work load versus the rate 
of increase in funding increases, they do not compare.
    There is one example that I was able to pull out in a quick 
analysis. In the past 7 years, the number of formal 
consultations that were handled annually by the Fish and 
Wildlife Service has grown fivefold in the past 7 years, while 
the consultation budget has only grown threefold.
    The third recommendation is perhaps the most important 
thing I can say today. Congress really needs to reject the new 
initiatives we are seeing from the Administration to 
essentially weaken the consultation process. The two most 
significant examples I can give you are:
    One, in January of this year, the Administration proposed a 
rulemaking for EPA that would allow that Agency to make its own 
``no adverse effect'' determinations with regard to pesticide 
registrations.
    Similarly, just a week or two ago, the Administration 
proposed to allow the Forest Service and three other land 
management agencies to make its ``no adverse effect'' 
determinations with respect to logging under the National Fire 
Plan.
    With respect to both of these kinds of movements and 
changes in the ESA policy, the result is that the Fish and 
Wildlife Service and NOAA Fisheries have reduced ability to 
protect listed species from threats that are well known. They 
have reduced the ability to insert their expertise into the 
process.
    I thank you for the opportunity to testify. I would ask 
that my complete testimony be included in the record in its 
entirety.
    Senator Crapo. Without objection, so ordered. Thank you, 
Mr. Kostyack.
    Ms. Horn?

STATEMENT OF PATRICIA HORN, VICE PRESIDENT AND GENERAL COUNSEL, 
                    OGE ENOGEX INCORPORATED

    Ms. Horn. Thank you, Chairman Crapo.
    I appreciate the opportunity to be here in front of this 
committee. I appreciate your leadership on this subcommittee 
and the committee. I especially appreciate Senator Inhofe on 
his work and commitment to Oklahoma.
    I am Vice President of Enogex, a pipeline company in 
Oklahoma. We are a natural gas pipeline and energy company. We 
do most of our work in Oklahoma and Arkansas. We are the tenth 
largest pipeline in the United States, so we do have a 
significant presence in those two States.
    The Company takes great pride and responsibility regarding 
environmental performance, accountability, and stewardship. Let 
me say we seek to achieve a balance between our dual 
responsibility to protect the environment and deliver reliable, 
safe, and reasonably priced services to our customers.
    My testimony today will cover some of the experiences that 
the company has experienced in the consulting process, both on 
a historical basis and a current basis. Basically let me tell 
you two background points.
    The company is a natural gas pipeline company and it 
connects natural gas wells that are completed and are capable 
of producing in commercial quantities. The owners of the gas 
are trying to get it to the market place--a time-sensitive 
interest by the owners in getting natural gas to the community.
    The issue that has come up is an endangered species called 
the American Burying Beetle. I would like to talk a little bit 
about that species. It was listed as endangered in 1989. At 
that time it was only found in two States--Oklahoma and Rhode 
Island. In 2002, a snapshot was taken, and it is located in 
seven States.
    It is in 17 Oklahoma counties, in the Eastern part of the 
State, and four counties in Arkansas. It is a large beetle. It 
is distinctive. It is a habitat generalist. It feeds on 
carrion. It operates in two different seasons of the year which 
gets to be critical with our construction practices. It is 
active during May through September, and inactive from October 
through April 1st. An interesting fact is that it can travel 
two miles per night. It is a quite mobile little beetle.
    I would like to talk about our historical clearance 
process. Informal consultation has actually been very 
favorable. Since 1989, continuing up to 2002, our consultations 
with the Fish and Wildlife Service have resulted in favorable 
clearances, either no presence of the beetle in the counties 
that I talked about, or no impact to the beetle by our proposed 
construction.
    Again, the timing that we are involved to do business is as 
follows. We go out and negotiate with producers who do not know 
when they drill a well whether it is going to be commercial or 
not. Once it is determined it is going to be producible in 
commercial quantities, we have to get out there quickly, 
construct the pipeline, and get that gas to market.
    The history that I discussed with you has been important 
that we knew predictability. We knew by going to the Agency we 
would get a result. Some of the results came in as few as three 
or 4 days, and we would get clearances. Other times it was up 
to 30 days.
    So again, the history has been favorable. We were surprised 
in 2002 when there was a real change to the procedure that we 
were required to go through, without a change in science, 
without a change in any of the data that we could find, that 
would really justify the change that we were required to go 
through.
    In July 2002, we were told by the Agency, ``OK, if it is an 
inactive season, get out there, do your construction. There is 
no problem. If it is during the active season when we were 
going to be out, then you could gate off the right-of-way.'' 
Again, not a problem.
    A complete reversal of that happened in October. In October 
we went in with two clearances with two big producer wells, 
Chesapeake Energy and BP Amoco. We were trying to connect those 
two wells. When we sought our clearances, the Agency 
determined, ``We do not have enough information. You are not 
going to be able to connect this well until you go out and do a 
survey of whether the beetle is present or not.''
    October is the inactive season. We could not do a survey 
until May. We were stuck with having a well that needed to get 
gas to market, but we could not connect until we did a survey 
that the beetle would not be active. We began a very aggressive 
communication with the EPA, which was the permitting agency 
here, and with the Fish and Wildlife Service. A stormwater 
permit was what we were required to get.
    We were trying to negotiate with them to enable us to do 
the work for our customers and move forward. A lot of 
information was requested. This was a daily process that we 
were involved in. We were able to get the information in. We 
requested this in September 2002. We received a final 
biological opinion at the end of January 2003.
    We were held up in that process. By that time we got a 
biological opinion--I am not going into all the problems of 
whether the biological opinion was justified or warranted; I am 
trying to set out the timing for this committee to understand. 
Again, this biological opinion is probably not warranted or 
justified, but we moved forward with trying to do that in this 
instance to try to connect the wells and get the process done. 
We do not want to be bound by that, when there is not the 
science, when there is not the balance being looked at, before 
going forward.
    I want to talk with you just a little bit about the effects 
of these two wells. One well we lost to competition. We were 
not able to connect that well. We lost a million dollars in 
revenues over the life of the well. The producer lost $2 
million by not being able to timely connect the well. As you 
know, gas prices are volatile and based upon not being able to 
connect that well during the time when prices were rising, 
resulted in that loss.
    We were able to construct and connect the other well. 
Again, $2.5 million was lost in this delay and $150,000 to 
Enogex. Overall, we are looking at $5 million as the economic 
ramifications of that one instance that I wanted to point out 
for this committee.
    You raised an interesting point. Are you worried about 
testifying here, Ms. Horn, because of ramifications to you? I 
will tell you that is one of the things that I have questioned. 
I want to have a good relationship, and the company wants to 
have a good relationship with these Agencies. I am here only to 
present the problem and to get resolution. I am not here for 
any other purpose.
    When we look at this and try to determine how we are going 
to move forward, we think the Fish and Wildlife Service is 
casting the net too widely. It is not based on sound science. 
There is no evidence at all that prior construction activity, 
75 years of oil and gas operations in this area of the State, 
has caused any detrimental effect to this species.
    Until we have that information, and until we determine why 
these species deteriorated, and why now it seems to be building 
back, we cannot go in and make any justifiable decisions about 
what should be done when the real intent here is to protect 
that endangered species.
    Again, we are looking for reasonable and predictable 
procedures. We are looking for sound science. We are looking to 
strike a balance between preservation and business timing 
ramifications that we have encountered here.
    Senators we request your consideration in helping to 
resolve this issue. I would ask that my complete testimony be 
included in the record in its entirety.
    Senator Crapo. Without objection, so ordered. Thank you, 
Ms. Horn.
    Mr. Chilton?

  STATEMENT OF JIM CHILTON, ARIZONA RANCHER, ON BEHALF OF THE 
    PUBLIC LANDS COUNCIL AND THE NATIONAL CATTLEMEN'S BEEF 
                          ASSOCIATION

    Mr. Chilton. Good morning, Chairman Crapo, and Senator 
Inhofe.
    My name is Jim Chilton. I am a rancher from Arivaca, 
Arizona. My family started ranching in Arizona in 1888. My 
family first started ranching in the Arivaca area in 1987. 
Arivaca, however, goes back much further than that. Father Keno 
put the town on the map in 1695 when it was the center for 
cattle grazing he brought with him from Mexico.
    My father, brother, and I run approximately 1,250 head of 
cattle on 85,000 acres of very good land for a semiarid area: 
48,000 acres are Arizona school trust land, 35,000 acres are 
forest land, and 2,000 acres are private. We are among the 
23,000 permittees who manage livestock to harvest annually, 
renewed grass resource grown on Federal lands.
    I appreciate the opportunity to be here today on behalf of 
sheep and cattle ranchers, and members of the Public Lands 
Council and the National Cattlemen's Beef Association. Every 
day is earth day for the men and women of the cattle industry.
    My story involves this. Federal land management agencies 
seriously misapplied the Endangered Species Act to the land and 
my Federal allotments. This struck me as deeply unfair. I was 
not willing to accept the judgment of their actions without a 
fight.
    I have spent countless hours and about $375,000 on lawyers, 
respected range scientists, bringing in soil experts, and 
assembled the best site-specific data to correct faults and 
misleading information stuffed into my file by the Forest 
Service and put in my record. After those expenditures, the 
record shows that my grazing allotment is in good to excellent 
condition, and is in an upward trend.
    In 1997, the Forest Service removed 20 acres from my 
Montana allotment. It is an Arizona allotment. It just happens 
to be called Montana. They removed 20 acres from California 
Gulch. That is a dry gulch that runs into Mexico. Our range is 
right on the Mexico border. This was over a Mexican minnow, the 
Sonora chub.
    In 1998, a Forest Service fish biologist asserted that 
grazing on my Forest Service allotment was likely to adversely 
affect the minnow. The adverse call was astonishing, since 
there was no water in the gulch nine to 10 months out of every 
year.
    The June 1990 issue of the Southwest Naturalist described 
the Sonora chub as abundant in Mexico where the chub dominates 
its 5,000 square-mile watershed. The fish was listed only 
because its range barely extended into the United States and 
one canyon east of my ranch. Any minnows that swim up across 
the international border onto my ranch are truly wetbacks. They 
die when it dries up.
    In a similar vein, the Forest Service botanist concluded in 
1998 that cattle grazing on the allotment was likely to 
adversely affect the lesser long-nosed bat, a listed species, 
even though the bat had never been on the allotment. Relying on 
his biologists, the Forest Service supervisor signed a 
biological assessment in November 1998 asserting that grazing 
would harm the minnow and the bat.
    Once the consultation process commenced, the Forest Service 
refused to allow me or my representatives to participate in the 
process. We were excluded even though we had applicant status. 
The final biological opinion of the U.S. Fish and Wildlife 
Service in April 1999 ignored my comments to the draft 
biological opinion.
    The final biological opinion included an incidental take 
statement with owners' terms and conditions which regulated my 
grazing allotment. As a practical matter, the Fish and Wildlife 
Service and the Forest Service added an estimated $25,000 to 
managing my allotment.
    Fortunately, a Federal District judge in a court decision 
struck down the biological opinion in 2000 as arbitrary, 
capricious, and unlawful. The District Court concluded that the 
species had to be present before the Fish and Wildlife Service 
could issue an incidental take statement and promulgate land 
use control and terms.
    The Forest Service and the Fish and Wildlife Service cannot 
regulate grazing based on potential or suitable habitat.
    Senator Crapo. Mr. Chilton, we just had three stacked votes 
called, which means we are going to be interrupted for a 
significant amount of time. Senator Inhofe and I have just 
discussed this. We are going to have to ask you to wrap your 
testimony quickly, and have Mr. Snape wrap up his testimony as 
quickly as he can.
    We are going to stay here for another 15 minutes. We are 
going to have to wrap up the hearing. We apologize for that.
    If you would not mind, Mr. Chilton, could you wrap up your 
testimony?
    Mr. Chilton. I traveled 3,000 miles to be here.
    Senator Crapo. We hear you. We will seriously consider your 
testimony. I have read your written testimony as well.
    Mr. Chilton. The bottom line is this. Not only did the 
Federal judge declare the biological opinion arbitrary, 
capricious, and unlawful, but the Forest Service decided to 
redo the consultation process. The word went around. ``Well, 
that was just one Federal judge's decision.''
    We appealed it to the Ninth Circuit Court of Appeals. The 
Arizona Cattlegrowers v. the United States Fish and Wildlife 
Service and the Center for Biological Diversity. We won.
    The Federal court said that the biological opinion was 
unlawful, arbitrary, capricious, and the Fish and Wildlife 
Service lacks the authority to impose terms, conditions, and 
land use regulations on listed species on the land where the 
species are not found. In other words, the species has to be 
there before the Fish and Wildlife Service has the 
jurisdiction.
    Affirming the lower court's ruling, the Court determined 
that the Federal agencies had the burden of proof to determine 
if the species existed on a grazing allotment.
    Furthermore, the Court ruled that even if cattle grazing 
occurred in the area where the listed species exist, the U.S. 
Fish and Wildlife Service must prove that cattle grazing will 
actually kill or injure the species.
    I will conclude by saying that we need sound science. We 
need good science. Science starts with disinterested evaluation 
of species listing proposals by objective scientists using peer 
reviewed science. We would like to see the ESA be amended to 
require the National Academy of Sciences or some other 
reputable third party to delist species or list species, and to 
review biological opinions and designated critical habitat. If 
we had had proper science, the Sonora chub and the lesser long-
nosed bat would never have been listed.
    Thank you. I would ask that my complete testimony be 
included in the record in its entirety.
    Senator Crapo. Without objection, so ordered. Thank you, 
Mr. Chilton.
    Mr. Snape, I apologize to you. I would ask you to be as 
brief as you can. I promise you that we will thoroughly 
evaluate your testimony.

 STATEMENT OF WILLIAM SNAPE, VICE PRESIDENT AND CHIEF COUNSEL, 
                     DEFENDERS OF WILDLIFE

    Mr. Snape. Thank you, Mr. Chairman, and Chairman Inhofe.
    Thank you for allowing me to testify. I am testifying not 
only on behalf of the Defenders of Wildlife, but also on behalf 
of the Endangered Species Coalition.
    I am going to focus on the three points that I identified 
on the cover page of my testimony. I flushed it out throughout 
the rest of my written testimony, but in the interest of time I 
will just emphasize those three points. I will take them in 
turn.
    The first conclusion that I made is that too frequently the 
focus of consultation is on mere short-term survival of the 
species and not recovery. Of course, recovery of the species is 
what I think we all agree upon under the Endangered Species 
Act. We may agree to disagree on many things. I imagine that we 
will. But we should all agree that the point of the Endangered 
Species Act is to recover these species and get them off the 
list. It is our opinion that frequently species are managed to 
hang on for survival, near the brink of extinction, but long-
term recovery measures are not taken. The woodland caribou is 
an example of this.
    Frequently, for many species, these consultations are not 
aimed at recovery. I think that is a conflict that is 
frequently not resolved. I think that results in litigation by 
both sides, or all sides, as the case may be. That is point No. 
1.
    Point No. 2 is that species with critical habitats tend to 
fare much better in consultation than species without such 
designations. I note here in my testimony the example of the 
pygmy owl and the silvery minnow. Mr. Glen and I have butted 
heads in Federal court over the pygmy owl. I agree with a lot 
of what he said, but certainly not all of it.
    I will point out that the pygmy owl that a species that was 
listed precisely because of habitat loss and habitat 
degradation. Therefore, I do not think it is too much to ask 
for Federal agencies like the Army Corps to take every acre of 
its important habitat into account when they are permitting 
under provisions such as the Clean Water Act. I do not think 
that is unreasonable.
    With all due respect to Senator Dominici, I disagree a 
little bit on that recent silvery minnow decision, I will point 
out only that he must be a speed reader. It is not a short 
opinion. It is 57 pages in the majority opinion, a 7-page 
concurrence, and a 35-page dissent. It is very complicated 
stuff.
    But my bottom line with the case, and I have to be a little 
careful here because we are one of the litigants in that 
litigation, is that the case is not about taking water out of 
people's mouths, or out of farmer's fields, for the silvery 
minnow. That is not what the case said and that is not what the 
case held. That may be in the big picture of what he thinks is 
happening.
    All that case said was that when the Federal Government is 
going to renew and implement a Federal contract with irrigation 
districts and with the city of Albuquerque that it must simply 
take endangered species into account. All the Court was saying 
here was that it was not convinced that the Bureau of 
Reclamation had no discretion or that the Bureau of Reclamation 
could not do anything to find any water to help the silvery 
minnow. The Court was asking the Bureau of Reclamation to ask 
these questions meaningfully.
    So I disagree with the concept that critical habitat or 
consultation has created this crisis. This is a crisis in New 
Mexico that they have known was coming down the pike and one 
that I think that the Bureau of Reclamation purposely stuck its 
head in the sand upon.
    Last, the consultation process is of value not only to 
wildlife but frequently to human beings. As John Kostyack said, 
it is a provision that asks Federal agencies only to look 
before they leap. Frequently, as Ms. Horn talked about, in the 
informal consultation process, good mutually advantageous 
changes can occur. I do not know much about the American 
burying beetle, so I cannot help elucidate that particular 
conflict.
    But frequently during the informal consultation process, 
negotiations and discussions occur where win-win solutions 
really are hammered out. The same is true for formal 
consultation. There are reasonable and prudent alternatives. 
The terms and conditions that are frequently in biological 
opinions almost always seek to avoid jeopardy and to find a way 
of moving forward.
    In fact, I am going to end by picking up with the theme 
that Mr. Chilton left upon--and again we may have to agree to 
disagree on our ultimate conclusions--but we want the best 
science as well. I think that sometimes there is conflict 
between the best available science, which is the standard in 
the act, and peer reviewed National Academy-type science, which 
leads to the very delays that permittees sometimes are 
complaining about. That is where the conflict is frequently 
occurring.
    As you look to ask the GAO to find more facts out about the 
consultation process, I would urge this subcommittee to look at 
the case law that has occurred over the last decade with 
Section 7 consultation. I think you will find lawsuits by 
environmentalists and industry. I think you will see 
environmentalists losing as much as they are winning. You also 
will see industry losing as much as it is winning.
    I think what you are seeing is the type of common sense 
application of Section 7 that I think this subcommittee is 
searching for. It is not always as efficient as someone like 
Mr. Chilton would like. But I believe that it is a process that 
is working and one that we need to get more information on to 
actually fine tune.
    Thank you, Mr. Chairman. I would ask that my complete 
testimony be included in the record in its entirety.
    Senator Crapo. Without objection, so ordered. Thank you 
very much, Mr. Snape.
    I am going to give the rest of the time that we have for 
questioning to Senator Inhofe. I have a lot of questions. What 
I am going to do is engage my questions in writing to this 
panel. I would ask that you to respond in writing so that we 
can continue the dialog.
    Without objection, so ordered.
    Senator Crapo. I apologize, but this series of votes which 
we could not predict is going to take us for the rest of the 
morning. When Senator Inhofe is done, we will conclude this 
hearing.
    Senator Crapo. Thank you, Mr. Chairman.
    Mr. Chilton, I know when you commented that you came 3,000 
miles to get here, I always feel badly. I happen to be a 
Republican, and I thought that when the Republicans took over 
we would not have this problem, but we do. When there are 
votes, there are votes and we cannot help that.
    Mr. Kostyack, you said that the consultation process has 
been streamlined. What period of time are you talking about 
that streamlining taking place?
    Mr. Kostyack. Actually, I was not specifically referring to 
the new measures that have happened in the past four or 5 
years. As Mr. Hill testified, on behalf of the GAO, there have 
been a number of very specific policy initiatives taken by the 
two wildlife agencies to streamline the process.
    My point about streamlining was simply that when you have 
97 percent of the overall consultations concluding informally 
without a biological opinion, and without the formal 
consultation procedures, it is a streamlined process. If you 
look at the regulations governing informal consultation, there 
is nothing in there that imposes any procedures on the 
Agencies, or that imposes any paperwork requirements.
    My experience has been that these are very frequently 
resolved with a single phone call and a single page letter 
confirming the outcome.
    Senator Inhofe. I was reading the quote that our chairman 
made.
    Who were you quoting at that time?
    Senator Crapo. The regional forester.
    Senator Inhofe. OK. There is very little difference between 
informal and formal consultations. Is that essentially what it 
said?
    Senator Crapo. I think what he was saying was that the 
amount of paperwork they were requiring was about equal.
    Senator Inhofe. I see that during 2001, there were 46,227 
informal consultation and 1,143 formal consultations. I would 
not want that to be construed to take only the formal 
consultations as evidence that this streamlining has taken 
place. That is not your intention; is it?
    Mr. Kostyack. No, not at all. My point is that obviously we 
need follow up investigation. A large percentage of these 
informal consultations, from my experience, do not involve 
extensive paperwork.
    There is a timeframe where neither Agency knows whether 
they are truly going to go to formal consultation. When they 
are in the information gathering mode, it may end up with an 
informal consultation required, and it may not. That point is 
the exact reason why we object to the Administration's new 
proposals for allowing the action agencies to completely take 
over this process and cut the wildlife agencies out.
    That point is when you really need to get your arms around 
the data, whatever data is available. There ought to be free 
sharing among the key agencies.
    Senator Inhofe. I would like to just ask very briefly, Mr. 
Glen, Ms. Horn, and Mr. Chilton, do you agree that there has 
been an improvement in this process? Are the trends going in 
the right direction or the wrong direction?
    Mr. Glen. To be honest, Senator, I think they are going in 
both directions. I have seen very significant improvements in 
some areas, but there are recent examples that trouble me as 
going in the wrong direction.
    An example in the wrong direction is the owl guidance I 
mentioned. I take issue with what Mr. Kostyack is saying about 
what happens in informal consultation. I mentioned in my 
testimony the Barton Springs salamander guidelines. Those were 
all resolved in informal consultation. The deal was you could 
get out an informal consultation if you agreed to develop no 
more than 15 percent of your property and you had no other real 
available process for a bunch of bureaucratic reasons to get 
out of that box. That is why those were actually litigated and 
have been withdrawn.
    Senator Inhofe. That is very interesting.
    Mr. Chilton, do you have any comments to make as far as the 
trends go?
    Mr. Chilton. The trends are to list more and more species 
using inadequate scientific information. If peer reviewed 
science were used, these species would not be listed. It is 
very important that the listing process be emphasized and that 
peer reviewed science be used, and that the Forest Service not 
make adverse calls when species are not present. They create 
work for the U.S. Fish and Wildlife Service. It is very 
inefficient. Yet, they tend to want to always want to make an 
adverse call.
    Senator Inhofe. Ms. Horn, do you have any comments to make?
    Ms. Horn. Senator, we have seen a trend starting toward 
this. We are seeing additional species being considered and 
critical habitat, and Western Oklahoma being considered for 
prairie chickens. We are seeing a trend for this increasing.
    Senator Inhofe. In your testimony, you talk about the 
various requirements that the Fish and Wildlife imposed on your 
company to avoid jeopardizing the beetle. Can you describe some 
of those requirements just so we can have them in the record.
    Ms. Horn. Yes, they are very much changing our construction 
practices. The costs are very prohibitive. One of the things 
that we now have to do is to employ a biologist to go out to 
every project that we have and do an assessment for the 
presence or absence of the beetle if it is in one of these 
counties.
    We also have a lot of procedures about baiting any beetle 
that could possibly be there again off the right-of-way. The 
construction practices that we are having to follow cause more 
resource time and energy delay. We are having to narrow the 
right-of-way that we can use. We are having to stop using 
pesticides and different practices that are not required 
environmentally, but are required for the endangered species, 
to make sure that we are trying to mitigate any possible 
potential impact to the beetle that may be there.
    Senator Inhofe. When you talk about biologists, are you 
talking about your staff people or using outside biologists?
    Ms. Horn. We are having to use an outside biologist because 
it has to be someone who knows the history of the beetle, and 
also someone who has a Section 10 permit.
    Senator Inhofe. I have a number of questions that I am 
going to submit for the record. I need to get very specific on 
the model that you are using for this particular beetle. There 
is not time to do it now.
    Without objection, so ordered.
    Senator Inhofe. Mr. Chilton, Ms. Horn, and Mr. Glen, we 
need for you to submit for the record also constructive 
suggestions on things that you could come up with that you 
think would help in this situation.
    As I think Mr. Kostyack and Mr. Snape both know, I had some 
experience in the private sector for some 30 years and had some 
similar problems. I am very sensitive to some of the things 
that come to this committee. But I also think it is a good idea 
to come up with constructive suggestions for improvements.
    With that, I am going to go ahead and ask you to do that 
for the record.
    Without objection, so ordered.
    Senator Inhofe. I am going to have to conclude this and 
adjourn this meeting. I thank you very much for coming, and 
particularly, Mr. Chilton, for coming as far as you did. I know 
there are some very serious problems out in Arizona that I am 
sure are affecting you right now. I appreciate your presence 
here.
    We are adjourned.
    [Whereupon, at 11:19 a.m., the subcommittee was adjourned, 
to reconvene at the call of the chair.]
    [Additional material submitted for the record follows:]
  Statement of Hon. Max Baucus, U.S. Senator from the State of Montana
    Thank you Mr. Chairman for calling this hearing today on the 
Section 7 consulting process under the Endangered Species Act. I am 
very interested in this issue, as this process has a particularly 
significant impact on the ground in my State of Montana, just as I know 
it does in yours, Mr. Chairman.
    I was particularly interested in the preliminary report prepared by 
the General Accounting Office, I believe at your request Mr. Chairman. 
I was struck by the many similarities between what I have heard from my 
constituents and the findings in that report.
    For example, the GAO points out: ``Even under normal workload 
conditions, the consultation process can be difficult, in part because 
decisions about how species will be protected must often be based on 
uncertain scientific information and on professional judgment.''
    ``Decisions resulting from consultations are sometimes challenged 
in lawsuits and responding to the lawsuits can increase workload and 
delay activities. These problems were magnified in the late 1990's 
after several fish species in the Pacific Northwest were listed as 
threatened or endangered.''
    ``The new listings increased the Service's consultation workload 
significantly in Idaho, Washington and Oregon, and the Services were 
unable to respond quickly.''
    The Service's issues are no less compelling and complex in Montana, 
and Montana has a fraction of the U.S. Fish and Wildlife staff that 
Idaho, Washington and Oregon have to deal with its consultation 
workload. Montana has only 18 permanent and 5 1-year term Fish and 
Wildlife Service ecological services employees. These employees are 
responsible for millions of acres of Forest Service, Bureau of Land 
Management and other Federal lands, and countless activities that occur 
across the State on private and State lands in Montana.
    Activities in Montana that could potentially or actually impact 
endangered, threatened or other sensitive species include: timber 
harvests and hazardous fuels reduction projects, irrigation 
development, coal mine development and expansion, new or expanded coal 
and gas fired power plants, new hydroelectric generating facilities, 
highway projects, airport facilities, sewage treatment plants and 
cellular tower placements. Many if not all of these activities could 
require some level of consultation with the Fish and Wildlife Service, 
to address or reduce impacts to fish and wildlife. Lack of funds and 
staff for Montana hamstrings every other Federal agency that depends 
upon opinions from the Fish and Wildlife Service.
    There's only so much that 18 full-time, permanent employees can do, 
in a State the size of Montana, with as many endangered, threatened and 
other sensitive species that we have, including grizzly bears, wolves, 
lynx, bull trout, sage grouse, prairie dogs, Yellowstone cutthroat 
trout, fluvial arctic grayling, sturgeon, and the list goes on.
    I've been told that good projects often never see the light of day 
in Montana, because the Fish and Wildlife Service just can't get to 
them they're struggling just to keep up with a crippling backlog. That 
backlog is hurting the economy of my State and rural, timber-dependent 
communities like Eureka, Thompson Falls, Columbia Falls, Seeley Lake 
and dozens and dozens more because every Forest Service timber sale 
requires some level of consultation with the Fish and Wildlife Service. 
County Commissioners bend my ear about this problem every time I'm back 
in the State.
    Not only can the Service do very little proactive work in Montana 
to work with communities and landowners to recover species and prevent 
species from being listed the staff is struggling to chip away at their 
crippling backlog of consultation and other work.
    Mr. Chairman, Montana is a growing State, and we're trying hard to 
continue to grow our economy, to provide more and better paying jobs 
for the citizens of our State. That means more projects, more 
improvements, more activity, and more potential for conflicts with fish 
and wildlife recovery goals.
    As Montanans, we prize our first-class landscapes, our pristine 
rivers and streams. We're proud of our outdoor heritage and our 
abundant fish and wildlife. We don't believe that economic growth and 
protecting fish and wildlife and their habitat are mutually exclusive 
goals.
    But, a lack of resources has made it very hard for the Fish and 
Wildlife Service to respond in a proactive way to Montanans' needs or 
the needs of our fish and wildlife populations. That's just not right.
    I would like to ask the Chairman if he would include Montana in the 
ongoing study on the consulting process required by Section 7 of the 
ESA. I believe Montana merits this consideration, and if necessary I 
will request a separate study from GAO of the situation in Montana. 
We're getting close to a crisis here, and from what I understand, it's 
been hard on the staff on the ground they've been working long hours, 
weekends, just to keep from getting buried. I've asked the leadership 
at the Fish and Wildlife Service and the Department of Interior 
multiple times to address this situation, and have received no 
response.
    I'm sorry to sound like a broken record on this issue, Mr. 
Chairman, but I believe very strongly that ensuring adequate resources 
for the Fish and Wildlife Service would mean important Federal, State 
and private sector projects more forward more quickly, more 
efficiently, and that potential problems are addressed up front. More 
people and more resources means the Service can work more pro-actively 
with the State and local land-owners on species conservation efforts, 
to avoid the need to list a particular species, or to help landowners 
cope with the presence of an endangered or threatened species on their 
property. For instance, as I've mentioned before, a few Service 
employees did great things to improve habitat for bull trout by taking 
the time to get to know local ranchers and citizens along the Blackfoot 
River in Montana.
    There may be other means to improve the section 7 consultation 
process, and I know that's why the Chairman called this hearing today. 
I too am interested about any way we can make this process work more 
smoothly.
    Mr. Chairman, I have worked hard in the past to propose common 
sense reforms to the ESA, in order to help the Fish and Wildlife 
Service and other agencies implement the Act more effectively, and with 
greater sensitivity to the needs of private landowners and States. I 
was proud of these efforts and the efforts of many of my colleagues on 
this Committee. I know you are interested in pursuing similar common-
sense reforms. But, no matter what may or may not happen with ESA 
reform this Congress or in any other Congress, we have to adequately 
fund the Fish and Wildlife Service, and we have to put adequate staff 
where it's needed the most. I can't say this enough.
    The investment would be small compared with the benefits to species 
and to the citizens of my State we'd see healthier forests, improved 
species habitat, reduced conflicts, continued economic growth, and 
fewer lawsuits.
    Thank you again, Mr. Chairman for calling this important hearing 
and I look forward to working with you in the future on this and other 
issues important to my constituents and the country.

                               __________
Statement of Hon. Pete V. Domenici, U.S. Senator from the State of New 
                                 Mexico

    Good morning. Thank you for inviting me to testify before the 
Subcommittee on Fisheries, Wildlife and Water on Section 7 
consultations required by the Endangered Species Act. I appreciate the 
opportunity to provide comments on an issue with which I have become 
all too familiar.
    Today, I would like to discuss a recent Tenth Circuit Court of 
Appeals decision by a three judge panel that essentially places the 
needs of a small endangered fish called the silvery minnow over the 
needs of the people of my State. On June 12, in a 2-to-1 decision, the 
Tenth Circuit ruled that the Federal Government can completely 
disregard its contractual commitments to provide much needed water to 
the cities, farms, and Indian reservations in New Mexico and instead 
take that water for the needs of the fish. The Court even found that 
the government can order the importation of water from another basin 
for the silvery minnow in violation of New Mexico State law that allows 
such transfers for municipal uses only.
    This judicial decision means that local governments, farming 
communities, and Indian tribes cannot reasonably expect a permanent 
water supply despite their long-held water contracts. If allowed to 
stand, this far-reaching interpretation of the Endangered Species Act 
will have a devastating impact in my State, which is already suffering 
from years of drought. If the decision is used in future litigation-
driven efforts to expand the reach of the Act via the Courts--which 
seems likely--the impacts of the Tenth Circuit's decision will register 
throughout the west and even the Nation.
    How did we get here? How can a Court interpret the ESA as 
preempting 75 years of existing water law, all existing contracts, and 
the needs of a burgeoning western population?
    In the case of the silvery minnow, it began with the ESA's section 
7 consultation process. As with many actions under the Act, the section 
7 consultation process for the minnow was triggered by litigation. In 
1999, a group of environmentalists demanded that the courts direct the 
Bureau of Reclamation to consult with the Fish and Wildlife Service 
over the Bureau's water and river operations on the Middle Rio Grande.
    Until that time, the Federal agencies had not consulted on the 
Bureau's operations because the Bureau was obligated to make water 
deliveries. The water in the Middle Rio Grande, like most of the water 
in the west, is completely accounted for pursuant to water contracts, 
interstate compacts, and perfected water rights under State law. As the 
Subcommittee is aware, one of the key issues with section 7 
consultations is whether or not the agency has discretion or control 
over the action at issue. In my opinion, because the Bureau had no 
discretion to alter these water deliveries, a section 7 consultation 
was not appropriate and should not have been ordered.
    Mr. Chairman, once the Fish and Wildlife Service produced a 
Biological Opinion in 2001, the litigation that began over a section 7 
consultation was leveraged into a legal challenge to the Biological 
Opinion. The environmentalists argued that the Bureau failed to consult 
on the full range of its alleged discretionary authority--even though 
the Bureau believed it had no discretion to take contractually 
obligated water or the water resulting from interbasin transfers. The 
section 7 consultation litigation was next transformed into a court 
fight over an injunction sought by the environmental groups. The case 
resulted in the district judge's determination that the Bureau has the 
discretion, under the ESA, to take New Mexico's water.
    The Tenth Circuit, in a divided opinion, upheld the district 
court's determination of the Bureau's broad discretion. The dissent, 
however, rightly characterized the ESA as a Frankenstein. Despite good 
intentions, this law has become a monster. As a Senator who voted to 
enact the ESA in 1973, I certainly do not recognize the statute after 
thirty years of expansive interpretation by the courts. Did any of us 
who voted for the ESA intend for it to apply retroactively? I did not. 
Did any of us believe the Act would, through the courts, achieve super-
status to the point of abrogating pre-existing contracts? I did not. It 
was never my intention, when I voted for the ESA, that the statute 
would violate previous Federal commitments over these water resources.
    The ESA must be applied prospectively. We cannot--particularly in 
the west--exist in a world where the statute is allowed to undermine 
the water contracts, interstate compacts, water rights perfected under 
State law, and even treaties which have long governed a river's 
management.
    Now, 4 years after the section 7 consultation litigation was 
brought, millions of dollars have been spent and the court case drags 
on. New Mexico is now in the position where it must request a rehearing 
en banc to the Tenth Circuit and, if necessary, take the fight all the 
way to the Supreme Court. In order to counter the potential devastating 
impact of the Tenth Circuit's decision, I am currently working with 
other members in the New Mexico delegation on legislation to provide a 
balanced approach--one that addresses both the needs of the people of 
my State and the needs of the silvery minnow.
    Mr. Chairman, the ESA, long-driven by litigation, is in dire need 
of reform. The section 7 consultation process, as examined by the 
Subcommittee today, seems to me a good place to start. Above all, 
certainty must be imposed on the process. Not only is certainty the 
bedrock of western water law, it is also critical for listed species. I 
believe we can amend the law to protect struggling species while, at 
the same time, allowing people access to the vital resources they need. 
I stand ready to assist the Subcommittee in any attempt to achieve 
comprehensive reform of the Act.
    Again, thank you for having me here today. I appreciate the 
opportunity to testify on this important matter.

                               __________
Statement of Barry T. Hill, Director Natural Resources and Environment, 
                       General Accounting Office

  ENDANGERED SPECIES: DESPITE CONSULTATION IMPROVEMENT EFFORTS IN THE 
                                PACIFIC

    Northwest, Concerns Persist about the Process

Why GAO Did This Study
    The Endangered Species Act requires all Federal agencies to consult 
with the Fish and Wildlife Service or the National Marine Fisheries 
Service (the Services) to determine the effect that the activities they 
conduct, permit, or fund may have on threatened or endangered species. 
In particular, Federal agencies (action agencies) must ensure that 
their activities do not jeopardize the continued existence of any 
listed species or adversely modify critical habitat. After several fish 
species in the Pacific Northwest were listed in the late 1990's, the 
Services' consultation workload increased significantly in Idaho, 
Oregon, and Washington, and the Services were unable to keep up with 
requests for consultation. As a result, many proposed activities were 
delayed for months or years. Even under normal workload conditions, the 
consultation process can be difficult, in part because decisions about 
how species will be protected must often be made with uncertain 
scientific information using professional judgment.
    This testimony is based on ongoing work requested by the Chairman 
of the Senate Subcommittee on Fisheries, Wildlife, and Water. It 
addresses (1) efforts to improve the consultation process, by the 
Services and by four action agencies in Idaho, Oregon, and Washington; 
and (2) concerns with the process expressed by officials at the 
Services and action agencies, and by nonFederal parties. www.gao.gov/
cgi-bin/getrpt?GAO-03-949T.

What GAO Found
    The Services and four action agencies in the Pacific Northwest have 
taken a number of actions to improve the efficiency of the consultation 
process. For example, the Services have increased their staff levels in 
some offices, and the National Marine Fisheries Service has opened 
additional offices to facilitate consultations at remote locations. The 
Services have also increased their use of consultations that cover 
multiple activities that are similar in nature, thus minimizing the 
need to consult on individual activities. Another improvement, called 
streamlining, uses interagency teams that work together on multiple 
activities; these teams work to improve communication, reach agreement 
on the potential effects of activities early in the process, and 
resolve problems that arise to ensure that proposed activities will not 
negatively affect listed species. In addition, the Services and the 
action agencies have worked, both individually and together, to develop 
and refine additional guidance and training for staff conducting 
consultations.
    Despite the improvement efforts, Service and action-agency 
officials, as well as nonFederal parties, continue to have concerns 
with the consultation process. A key problem that lengthens the 
consultation process is the lack of a shared understanding between the 
Services and action agencies on what constitutes a complete biological 
assessment. According to Service and action-agency officials, this can 
lead the Services to make multiple requests for information from the 
action agencies about an activity until the Services are confident that 
a biological assessment adequately addresses the effects of the 
proposed activity on the species. Multiple requests for information are 
also sometimes due to Service biologists' being unfamiliar with Action-
Agency programs, partly owing to high staff turnover. In addition, 
Action-Agency officials noted that the Services and the action agencies 
attempt to ensure that biological assessments are ``bullet proof'' by 
making them so comprehensive that they will be immune to any legal 
challenges. Action-Agency officials also expressed a concern that 
Service and action-agency roles are not clearly defined. For example, 
according to action-agency officials, Service officials sometimes make 
judgments about whether an activity should occur or how it should 
occur, rather than just judging its potential effects on species. In 
response, Service officials commented that the purpose of the 
consultation process is to discuss the potential effects of proposed 
actions early in the planning process and to explore options that will 
avoid jeopardy. Service and action-agency officials also identified a 
lack of sufficient resources-particularly at the Services-as a key 
concern, stating that staff-level increases have not kept pace with 
their growing workloads. Among the nonFederal parties, permit 
applicants expressed concerns about the time and expense required for 
the consultation process. Environmental groups said land management 
decisionmaking processes, such as consultation, are often closed to 
them until after final decisions are made, and that the only way they 
can make their voices heard is through administrative appeals and 
lawsuits.
    United States General Accounting Office
    Mr. Chairman and Members of the Subcommittee:
    I am pleased to be here today to discuss preliminary results from 
our ongoing review of the consultation process required by the Federal 
Endangered Species Act, particularly as applied in the Pacific 
Northwest. Under the act, before Federal agencies may conduct, permit, 
or fund activities in areas where species listed as threatened or 
endangered may be present, the agencies must consult with the 
Department of the Interior's Fish and Wildlife Service or the 
Department of Commerce's National Marine Fisheries Service (the 
Services). Such consultation is intended to allow Federal agencies to 
ensure that the activities are not likely to jeopardize the species' 
continued existence or adversely modify their critical habitat. 
Consultation has particularly significant effects in the Pacific 
Northwest because numerous species there are threatened with 
extinction, including the Northern spotted owl, various salmon species, 
and the bull trout.
    Federal activities that agencies may need to consult about in the 
Pacific Northwest range from operating hydroelectric dams on the 
Columbia River-which provide about 60 percent of the Federal 
electricitygenerating capacity in the region-to harvesting timber, to 
dredging navigation channels. Responsible agencies-or ``action 
agencies``-include the Department of the Interior's Bureaus of Land 
Management and Reclamation, the Department of Agriculture's Forest 
Service, and the Army Corps of Engineers, to name a few. Typical 
nonFederal activities that these agencies permit, which may also 
require consultation, include grazing, timber harvesting, and mining on 
Federal lands, and building structures such as piers and docks on 
private property. NonFederal parties, such as private landowners, 
developers, or local governments, typically conduct these permitted 
activities.
    If an action agency determines that an activity may affect a listed 
species, the agency may initiate either an informal or a formal 
consultation with the appropriate Service. In an informal consultation-
which could be as simple as a brief telephone call-the Service and 
action agency may agree that the activity is unlikely to negatively 
affect the species and that formal consultation is not necessary. On 
the other hand, if the Service or agency initially believes or finds 
after informal consultation that the activity may have negative 
effects, the action agency initiates formal consultation by submitting 
a biological assessment of the activity and its potential effects. If 
negative effects appear likely and formal consultation is required, the 
Service has 135 days to formally consult and document, in a biological 
opinion, whether the activity could jeopardize the species' continued 
existence and what actions, if any, are required to mitigate those 
effects. Avoiding jeopardy caused by federally conducted or approved 
activities is important to achieving the overall purpose of the 
Endangered Species Act, which is to conserve species that are at risk 
of extinction.
    Even under normal workload conditions, the consultation process can 
be difficult, in part because decisions about how species will be 
protected must often be based on uncertain scientific information and 
on professional judgment. Decisions resulting from consultations are 
sometimes challenged in lawsuits, and responding to the lawsuits can 
increase workload and delay activities. These problems were magnified 
in the late 1990's, after several fish species in the Pacific Northwest 
were listed as threatened or endangered. The new listings increased the 
Services' consultation workload significantly in Idaho, Washington, and 
Oregon, and the Services were unable to respond quickly. As a result, 
many activities that Federal agencies proposed were delayed for months 
or years. Action agencies and others criticized the consultations as 
unduly burdensome.
    Our testimony, which is based on ongoing work that you requested, 
addresses (1) key efforts to improve the consultation process in the 
Pacific Northwest and (2) concerns about the consultation process 
identified by officials from the Services and other Federal agencies, 
and by nonFederal parties, including environmental advocacy groups. To 
gather their views on consultations, we administered a structured 
questionnaire to 61 officials with the Services and the Army Corps of 
Engineers, the Bureaus of Land Management and Reclamation, and the 
Forest Service in Idaho, Oregon, and Washington. We conducted 133 
additional interviews with agency officials in headquarters and field 
offices and with nonFederal parties; we also visited various locations 
in the three States. Prior to issuing this testimony, we shared a 
preliminary draft with the agencies we reviewed and incorporated their 
comments as appropriate. We conducted our work in accordance with 
generally accepted government auditing standards. Our final report, 
which we anticipate issuing in late August 2003, will present 
additional information about the adequacy of agency data bases that are 
used to maintain key information on individual consultations. Our 
report will also provide Service and action-agency perspectives on 
improvements made to the consultation process.

                                SUMMARY

    Efforts by the Services and action agencies to improve the 
consultation process have focused on increasing the number of staff 
that conduct consultations, improving the efficiency of the process, 
and providing additional training and guidance for consultation staff 
and nonFederal parties. For example, both of the Services have 
increased their staff levels in certain offices, and the National 
Marine Fisheries Service has established new offices, among other 
things, to facilitate consultations at remote locations. To improve 
efficiency, the Services have increased their use of consultations that 
address multiple activities, minimizing the need to consult on 
individual ones. For example, one consultation in western Oregon covers 
ten types of routine activities in three national forests and two 
Bureau of Land Management districts. Another improvement, called 
streamlining, uses interagency teams for consultations to improve 
communications among the Services and action agencies on multiple 
activities, get agreement on the potential effects of an activity 
faster, and help resolve problems that arise. Finally, the Services and 
the action agencies have worked, both individually and together, to 
develop and refine additional guidance and training for staff 
conducting consultations. Interagency efforts include refresher 
training on the streamlining process and development of Web sites that 
provide staff with preparation instructions for, and examples of, 
biological assessments and other key consultation documents.
    Despite the improvement efforts, Service and action-agency 
officials, as well as nonFederal parties, continue to have concerns 
with the consultation process. A key problem that lengthens the 
consultation process is that the Services and action agencies do not 
always share an understanding of what constitutes a complete biological 
assessment. According to Service and action-agency officials, this can 
lead to multiple requests by the Services for information from the 
action agencies about an activity until the Service is satisfied that a 
biological assessment adequately assesses the effects of a proposed 
activity on listed species. Multiple requests for information also 
sometimes stem from Service biologists' unfamiliarity with action-
agency programs, partly owing to high staff turnover. In addition, 
action-agency officials noted that the Services and the action agencies 
attempt to ensure that biological assessments are ``bullet proof'' by 
making them so comprehensive that they will be immune to any legal 
challenges. Action-agency officials also expressed a concern that 
Service and action-agency roles are not clearly defined. For example, 
according to action-agency officials, Service officials sometimes make 
judgments about whether an activity should occur or how it should 
occur, rather than simply judging its potential effects on species. In 
response, Service officials commented that the purpose of the 
consultation process is to discuss the potential effects of proposed 
actions early in the planning process and to explore options that will 
avoid jeopardy. Service and action-agency officials also identified a 
lack of sufficient resources-particularly at the Services-as a key 
concern, stating that staffing increases have not kept pace with their 
growing workloads. Among the nonFederal parties, permit applicants 
expressed concerns about the time and expense required for the 
consultation process. For example, the average permit processing time 
for 19 permits issued in 2002 for building private docks or for similar 
activities on Lake Washington (near Seattle) was about 2 years and 
added about $10,000 to applicants' costs. Environmental groups said 
land management decisionmaking processes, such as consultation, are 
often closed to them until after final decisions are made, and that the 
only way to make their voices heard is through administrative appeals 
and lawsuits.

Background
    The Endangered Species Act prohibits the ``taking'' of any 
threatened or endangered species of animal and defines ``take'' as to 
harass, harm, pursue, shoot, wound, kill, trap, hunt, capture, or 
collect, or to attempt to engage in any such conduct. Federal agencies 
must comply with prohibitions against taking species listed as 
threatened or endangered and must consult with the Services to 
determine the effect, if any, that their activities may have on listed 
species. In particular, Federal agencies must ensure that their 
activities do not jeopardize the continued existence of any listed 
species, or destroy or adversely modify habitat designated as critical 
for those species. If any proposed activities will jeopardize a species 
or adversely modify its critical habitat, the Services will identify 
alternatives to those activities.
    The Fish and Wildlife Service and the National Marine Fisheries 
Service together have responsibility for implementing the Endangered 
Species Act. The Fish and Wildlife Service is responsible for the 
protection of terrestrial, or land-dwelling, and freshwater animal and 
plant species. Endangered or threatened terrestrial animals in the 
Pacific Northwest include the Northern spotted owl, the grizzly bear, 
and the Canada lynx. The Service also manages land in national wildlife 
refuges and, like other land-managing agencies, must consult with its 
own biologists in determining the effect of its activities on listed 
species. The National Marine Fisheries Service is responsible for the 
protection of oceandwelling species and anadromous species, such as 
salmon.\1\
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    \1\ Anadromous species live part of their lives in fresh water and 
part in saltwater.
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    Several Federal agencies manage land in the Pacific Northwest or 
conduct activities there, many of which require consultation under the 
Endangered Species Act.
      The Army Corps of Engineers (Corps) supports navigation 
of the nation's waterways by maintaining and improving channels. In 
Idaho, Oregon, and Washington, the Corps also operates 12 dams and 
reservoirs that provide flood control, generate hydroelectric power, 
protect fish and wildlife, and support recreation and other activities. 
In addition, the Corps issues permits to parties who wish to conduct 
activities in lakes, streams, and wetlands; these activities include 
dredging or filling waterways, and building structures ranging from 
docks and driveways to housing developments.
      The Bureau of Land Management manages about 28 million 
acres of Federal land in Idaho, Oregon, and Washington. The agency 
issues permits for and manages such activities as livestock grazing, 
recreation, mining, and timber harvests; many of these activities 
require consultation.
      The Bureau of Reclamation's core mission is to deliver 
water and hydroelectric power throughout 17 western States. In the 
Pacific Northwest, it operates and maintains 28 dams and administers 54 
reservoirs. Its primary activities that require consultation are dam 
construction, operation, and maintenance.
      The Forest Service manages about 45 million acres of 
national forest in Idaho, Oregon, and Washington. The agency issues 
permits for, manages, and must consult on activities such as timber 
harvesting; recreation; livestock grazing; mining; environmental 
restoration; and rights of way for road construction, ski areas, and 
access to private land.

Improvement Efforts Have Focused on Staffing Resources, Efficiency, 
        Guidance, and Training
    The Services and action agencies have increased the number of staff 
that conduct consultations. Specifically, the Fish and Wildlife Service 
increased the number of biologists in some of its offices in order to 
address their growing consultation workload. The National Marine 
Fisheries Service also increased staff levels at several offices, and 
opened several new field offices in 2001 to facilitate consultations at 
remote locations. Previously, the geographic distance between the 
locations made consultations difficult. In addition, some action 
agencies have found it useful to provide funding for one or more 
Service biologist positions to specifically work on, or give priority 
to, that action agency's consultations. For example, the Corps' Seattle 
district provides funding for a Fish and Wildlife Service biologist 
position. The district gives the Service a list of upcoming activities, 
and the Corps-funded Service biologist works on consultations for those 
activities.
    To improve the efficiency of the consultation process, the Services 
have increased their use of consultations that address multiple 
activities, minimizing the need to consult on individual activities. 
These multipleactivity consultations, often referred to as 
programmatics, sometimes allow action agencies to approve activities 
that meet predetermined criteria without additional consultation. 
Programmatics may cover repetitive activities with similar effects, 
such as road and recreation trail maintenance, or a variety of 
activities affecting a particular area or group of species, such as 
forest fuels treatment, grazing, and watershed restoration projects 
conducted in bull trout habitat. Multiple-activity consultations may 
also cover these types of activities in a specific region, as in three 
western Oregon national forests and two Bureau of Land Management 
districts, where one consultation covers ten categories of routine 
activities.
    Another improvement effort, streamlining, is intended to reduce the 
time spent on consultations by facilitating early planning, up-front 
coordination, and communication between the Services and action 
agencies. Under the streamlined process, officials work on interagency 
teams that meet regularly to discuss upcoming action-agency activities 
and review draft biological assessments. The belief is that with 
improved communication, more trust will develop between the Services 
and action agencies, and problems will be easier to resolve when they 
arise. Accordingly, for formal consultations that go through 
streamlining, the Services, the Bureau of Land Management, and the 
Forest Service set a goal of reducing the time allotted from the 
current legal requirement of 135 days to 60 days. Streamlining is 
currently used for most Bureau of Land Management and Forest Service 
activities in the Pacific Northwest. In addition, the Bureau of Land 
Management and the Forest Service are involved in a pilot process in 
some locations in Idaho and Oregon. In this process, the action 
agencies have been delegated the authority to certify that certain 
activities meeting pre-established criteria are unlikely to adversely 
affect listed species and can therefore proceed.
    Both the Services and the action agencies have provided additional 
training and guidance to improve understanding of the consultation 
process and one another's roles and authority, including the following.
    The Services have developed refresher training on the consultation 
process, have prepared guidance on how to prepare a high-quality 
biological assessment, and provide continuing professional education on 
evaluating the biological effects of proposed activities.
      The Services, the Bureau of Land Management, and the 
Forest Service have developed an interagency Web site with links to the 
Endangered Species Act and its regulations and to guidance on 
streamlined consultation procedures. They plan to add examples of 
biological assessments and other documents as guidance for teams using 
streamlined procedures.
      The National Marine Fisheries Service currently provides 
links on its Web site to biological opinions and to a tracking system 
that shows the status of consultations. The Service also plans to 
launch a separate Web site this year to provide guidance to action-
agency biologists and others on preparing biological assessments.
      The Army Corps of Engineers has developed Web sites to 
inform citizens about the permitting and consultation processes. These 
Web sites include instructions on applying for permits for activities 
such as pier and dock construction.
    Several action-agency officials told us that they also sometimes 
use site visits to educate stakeholders (e.g., the Services, the action 
agency, and interested nonFederal parties) about a proposed activity. 
An Army Corps official, for example, said the Corps has taken Service 
biologists out on dredges to increase the biologists' understanding of 
dredging operations and their likely effect on species. In another 
example, a Forest Service biologist convened onsite meetings of all the 
stakeholders in a consultation about the proposed development plan for 
a ski area in Washington. These stakeholders (representatives of the 
Forest Service, the Fish and Wildlife Service, the ski area, the State, 
and a local hunting group) walked through the proposed development 
areas and discussed ways to prevent the development from adversely 
affecting the species involved. This onsite collaboration, according to 
the Forest Service biologist, gained agreement by all stakeholders on 
how the development could avoid adversely affecting listed species. It 
also may have forestalled litigation by the State and the local hunting 
group, which had previously opposed the proposed development plan.
Despite Improvement Efforts, Concerns Remain about Consultations
    Despite ongoing efforts to improve consultations, Service and 
Action-Agency officials continue to have concerns about the 
consultation process. The absence of shared criteria for complete 
biological assessments, Service biologists' lack of knowledge about 
action-agency programs, and fear of litigation were frequently 
mentioned by Service and action-agency officials as significant 
concerns. In addition, according to some Action-Agency officials, 
Service and action-agency roles are not clearly defined, which leads to 
Service officials sometimes recommending changes to agencies' proposed 
activities beyond what action agencies think is necessary to minimize 
the negative effect on species. In response, Service officials 
commented that the purpose of the consultation process is to discuss 
the potential effects of proposed actions early in the planning process 
and to explore options that will avoid jeopardy. Service and action-
agency officials were also concerned about a lack of sufficient 
resources, particularly at the Services. Among nonFederal parties, 
concerns were expressed about the time and cost required for 
consultations and about a perceived lack of openness and effectiveness 
in the consultation process.

Officials Do Not Have a Common Understanding of the Information Needed 
        in Biological Assessments
    A key problem that lengthens the consultation process is that the 
Services and action agencies do not always have an understanding of 
what constitutes a complete biological assessment-that is, one that 
provides sufficient scientific information to determine an activity's 
effect on a species. Because of this lack of common criteria, and 
because complete scientific information is rarely available for listed 
species, officials often rely on their judgment and experience to 
determine the likely effect of activities on species. Some Service 
officials we interviewed said that they often do not receive 
sufficiently detailed information from the agencies in a biological 
assessment about the activity so that they can independently assess its 
likely effects on the species. They therefore request additional 
information and do so until they are satisfied that the assessment 
adequately addresses the effects of the proposed activity on the 
species. On the other hand, some action-agency officials said they 
believe that the Services require much more detailed information than 
is necessary to determine whether they agree with the action agency's 
assessment of the activity's effects. Many Service and action-agency 
officials said that these requests for additional information and 
associated discussions can delay the consultation process and cause 
frustration.
    Disagreements over the detail needed in biological assessments are 
exacerbated because many officials perceive the consultation process as 
personality-driven. Specifically, Service and action-agency officials 
said that sometimes officials on both sides of the issue take 
unyielding positions on consultations, either on behalf of the activity 
or the listed species, and they waste time arguing. In these instances, 
the process takes much longer to complete than when participants are 
able to compromise. In addition, action-agency officials said some 
Service biologists-particularly new ones-can be overly zealous in their 
efforts to protect species and may be unlikely to compromise; at the 
same time, action agencies do not always involve the Services early 
enough in consultation, making the process difficult. In other cases, 
officials told us that some individuals that are key to the 
consultation process lack the interpersonal or negotiation skills 
necessary to resolve conflicts that arise in the process. One action-
agency official noted, ``there is no room in the process for zealots-on 
either side.''
    National Marine Fisheries Service officials recognize the need for 
better guidance regarding the level of detail required in biological 
assessments and are developing training for their biologists, along 
with a Web-based template and checklist for action agencies. Service 
officials told us that they believe deadlocked disagreements over 
biological assessments are less common than they used to be, and when 
they do occur it is sometimes because issues are not elevated to 
management for resolution when they should be. Furthermore, they 
believe that increased staff, planning, and field offices have helped 
alleviate these issues.

Service Biologists Are Unfamiliar with Action-Agency Programs
    Service and action-agency officials agreed that Service biologists 
are sometimes unfamiliar with action-agency programs and activities and 
that the time required for Service biologists to learn about activities 
and how they may negatively affect species can lengthen the 
consultation process. High turnover among Service biologists is one 
factor that contributes to their lack of familiarity with action-agency 
activities. In one example, Service biologists did not understand the 
process of mining for gold in streams until they were given a field 
demonstration. Allowing the Service biologists to see the mining 
equipment in operation helped facilitate the consultation process 
because the biologists did not have to ask numerous clarifying 
questions to understand the activity's potential impact. Although site 
visits can help familiarize biologists with action-agency activities, 
because of resource limitations, Service and action-agency officials 
said they are unable to make site visits a routine part of 
consultation.

Service and Action-Agency Officials Are Concerned about Litigation
    Service and action-agency officials alike cited the fear of 
litigation as a significant concern that lengthens the consultation 
process. Since 1999, the Services have been affected by at least 19 
lawsuits involving consultations in courts with jurisdiction in Idaho, 
Oregon, and Washington. For example, according to a Forest Service 
official in Oregon, at least two dozen timber projects have awaited 
consultation for 2 years because a court ruled that the National Marine 
Fisheries Service used insufficient scientific data to support a 
determination that natural vegetation growth would adequately mitigate 
the effects of logging.\2\ This decision invalidated more than 20 
existing biological opinions for timber harvests, which will await 
formal consultation until the National Marine Fisheries Service 
implements a strategy for addressing the court's concerns. In addition, 
both Services must respond to notices of lawsuits and agreements that 
settle lawsuits.
---------------------------------------------------------------------------
    \2\ Pacific Coast Federation of Fishermen's Associations v. 
National Marine Fisheries Service, 265 F.3d 1028 (9th Cir. 2001).
---------------------------------------------------------------------------
    According to action-agency officials, such court rulings have led 
Service officials to apply the same level of scrutiny to all 
activities, regardless of the level of risk they pose to listed 
species. Action-agency officials believe that the Services attempt to 
ensure that all biological assessments are ``bullet proof``-or so 
comprehensive that they are impervious to legal challenge-and this adds 
to the time and cost of consultation. As a result, Service officials 
apply similar scrutiny to activities that are less likely to have long-
term negative impacts, such as trail maintenance or habitat 
restoration, as they do to activities with much higher potential for 
long-term negative effects, such as mining. Some action-agency 
officials recognized that this fear of litigation similarly causes them 
to put more details in their biological assessments than they otherwise 
would. Furthermore, Interior officials expressed concerns that existing 
litigation, and the risk of future litigation, may be interfering with 
the consultation process and diverting to litigation a disproportionate 
amount of the funds intended for Endangered Species Act implementation.

 Service and Action-Agency Roles in Consultations Are Not Clearly 
        Defined
    According to action-agency officials, Service and action-agency 
roles are not clearly defined. Some action-agency officials expressed 
concern that Service biologists sometimes make judgments about whether 
an activity should occur, rather than just its potential effects on 
species. Action-Agency officials told us they believe decisions about 
activities' design should be left to the action agencies. The 
Department of the Interior's Assistant Secretary for Water and Science 
recently discussed this concern in an address to Bureau of Reclamation 
employees. The Assistant Secretary asserted that it is the Bureau's 
responsibility to determine how its proposed activities should be 
designed and the Services' responsibility to issue biological opinions 
on those activities' potential impact on species. He emphasized that 
the Bureau should not include components in its proposed activities 
that it believes are not necessary for avoiding negative effects to 
listed species, simply because the Services want those components 
included. The Bureau's Commissioner also issued a policy statement 
reiterating the Assistant Secretary's position that it is the Bureau's 
responsibility-not that of the Services-to define its proposed 
activities and to provide a biological assessment that is based on the 
best available science. The policy states that the Bureau should rely 
on the Services to respond with a scientifically sound biological 
opinion-which may include a determination that an activity will 
adversely affect a listed species. In that event, Bureau and Service 
officials would work together to develop acceptable measures for 
mitigating the activity's detrimental effects. In commenting on a draft 
of this statement, Service officials said that the purpose of the 
consultation process is to discuss the potential effects of proposed 
actions early in the planning process and to explore options that will 
avoid jeopardy.

Insufficient Staffing Resources Are a Key Concern
    Service and action-agency officials identified a lack of sufficient 
resources-particularly at the Services-as a key concern that limits 
timely completion of consultations. Service and action-agency officials 
are concerned that although staff levels have increased in recent 
years, staffing has not kept pace with their growing workloads. For 
example, data from the Fish and Wildlife Service's office in Portland, 
Oregon, show that while the office's budget for consultations increased 
approximately 40 percent between fiscal years 1998 and 2002, the number 
of consultations for which each biologist was responsible increased 
about 90 percent. One consequence of this disparity between resources 
and workload is that the Services cannot always meet regulatory 
timeframes. Furthermore, officials said that there is an upward trend 
in the types of activities that require consultation. For example, as a 
result of a court ruling in the mid-1990's, the Bureau of Land 
Management and the Forest Service must consult with the Services on 
their land management plans. This ruling created a substantial new 
workload for the agencies and the Services, and they are still working 
to complete the consultations in some areas.

Some NonFederal Parties Are Concerned about the Length and Cost of the 
        Permitting Process
    NonFederal parties wishing to conduct activities requiring 
consultation because they involve Federal permits or licenses also 
expressed concerns about the time and cost required for the process. 
When nonFederal parties apply to an action agency for a permit or 
license, they must go through reviews required by the action agency for 
approval. These reviews can include consultation. Action agencies 
either prepare (sometimes at the applicant's expense), or ensure that 
applicants have arranged for the preparation of, a biological 
assessment; the agency then reviews the biological assessment and 
requests additional information as needed. According to a Service 
official, economic impacts and the scope of the proposed activity are 
considered during consultation, in addition to whether or not the 
activity will jeopardize listed species or adversely modify critical 
habitat.
    In one example, a private landowner waited about 3 years-including 
time for Forest Service permit review and consultation-related 
activities-for a permit that would allow him to cross Forest Service 
land to harvest his privately owned timber stand. To cross the Forest 
Service land, the landowner had to improve an old logging road and 
construct about half a mile of new road, which he did himself, work 
valued at about $9,000; he also reimbursed the Forest Service about 
$6,800 for the costs to prepare a biological assessment for the 
consultation. Further, according to the landowner, when he was finally 
able to harvest the timber its market value had dropped by one-third to 
one-half from its anticipated value. The Forest Service biologist who 
worked on this consultation noted that it was affected by numerous 
complicating factors, including a court decision barring the Fish and 
Wildlife Service from issuing biological opinions on activities 
affecting spotted owls and a new policy for dealing with private 
landowners.
    In another example, the average time for the Corps to process 19 
permits issued in 2002 for building private docks or for similar 
activities on Lake Washington (near Seattle) was about 2 years. This 
time included the consultation time spent by each Service, as well as 
the time spent by the action agency to help the permit applicant 
complete a biological assessment and meet other Corps requirements for 
the permit. For these permits, consultation added about $10,000 to 
nonFederal parties' costs. Officials from the Services noted that these 
types of delays were not uncommon when bull trout and salmon were first 
listed because so many activities, many of them in urban areas, were 
affected. A National Marine Fisheries Service official stated that 
these listings created an ``automatic backlog'' of consultations that 
overwhelmed them. A Fish and Wildlife Service official also noted that 
the delays were at least partly due to their unfamiliarity with the 
effects that building docks could have on bull trout. The bull trout 
was the first aquatic species that they had to deal with in the Pacific 
Northwest.

Environmental Groups Are Concerned that Consultations Lack Openness and 
        Effectiveness
    Environmental advocacy groups also expressed concerns with the 
consultation process. Representatives of two environmental advocacy 
groups said land management decisionmaking processes, such as 
consultation, are often closed to them until after final decisions are 
made, and that the only way they can make their voices heard is through 
administrative appeals and lawsuits. One representative expressed 
concern that the streamlining process lacks transparency and 
compromises the Services' role of scrutinizing action-agency 
activities. Service officials noted that the Endangered Species Act 
does not require public participation or public comment in the 
consultation process. One environmental group's representative 
expressed concern that the Services do not have a comprehensive view of 
a species' status across its range and therefore are limited in their 
ability to determine the potential effects of proposed activities. For 
example, the bull trout may or may not be significantly affected by an 
activity in one stream, but unless the Services know the trout's status 
across its range, they cannot make informed decisions about how an 
activity will affect the species as a whole.
    Mr. Chairman, this completes my prepared statement. I would be 
happy to respond to any questions that you or Members of the 
Subcommittee may have.

                               __________
                   Statement of Alan Glen, Austin, TX

    Good morning Mr. Chairman and Members. My name is Alan Glen, and I 
am a lawyer from Austin, Texas. I am particularly interested in the 
topic of interagency consultations under the Endangered Species Act 
(``ESA'') and am hopeful that the interest and efforts of this 
Subcommittee will help to enhance the consultation process and make it 
a more efficient tool for species conservation.

I. Introduction
    My testifying for increased efficiency in the ESA consultation 
program is a little bit like a tax lawyer testifying for streamlining 
the tax code. A significant proportion of my work involves assisting 
clients in navigating the complex and acronym-rich ESA consultation 
process. Our firm represents clients, ranging from developers, to 
utility companies and State and local governments, across the Nation in 
ESA matters. My experience with consultations under the ESA is 
firsthand, having handled dozens of consultations involving a wide 
variety of activities and species. Through this experience, I have seen 
significant conservation and economic benefits derived from resolution 
of endangered species conflicts through the consultation process. 
Unfortunately, I have also recognized maddening inefficiencies and 
uncertainties, many created by the very agency they afflict. I do see 
the Fish and Wildlife Service (``Service'') making positive strides to 
improve the efficiency and effectiveness of the consultation process, 
but some problems remain.
    Statistics regarding the ESA consultation process are often cited 
in an effort to demonstrate that the program is working, and with 
little impact on government and economic activity. We are told that 
thousands of consultations are processed each year, with only a handful 
resulting in a ``jeopardy'' conclusion. These statistics, however, do 
not reveal the enormous cost in terms of time, money, project changes, 
and mitigation property or payments associated with completing these 
thousands of consultations. Perhaps the pending GAO report will shed 
some light into the trenches of the process, where most of my labor is 
performed.
    Today, I will focus briefly on some of what I refer to as the self-
inflicted wounds of ESA consultations: areas in which the Service may 
be making life harder on itself than necessary or appropriate. First, I 
will mention the trend toward lowering the thresholds or ``triggers'' 
of the consultation process, resulting in many more consultations with 
perhaps little conservation benefit. Next, I will discuss the use of 
delay beyond the legally required timeframe for the completion of 
consultations, and how illegal delays are sometimes used as a tool for 
extracting concessions that are not otherwise required by law. Last, I 
will mention the use and impact of ``draft'' jeopardy conclusions which 
can be a tool to extract costly mitigation far beyond what the law 
requires. The Service has been making progress in addressing some of 
these concerns on a policy level. In practice, though, they still arise 
with some degree of frequency.

II. Lowering Consultation Thresholds
    The Service conducts thousands of ESA consultations every year. 
Many of these, however, involve activities with little, or purely 
speculative, biological impacts. Because the thresholds required for a 
consultation to actually modify a project or activity (the project must 
be found to jeopardize or at least ``take'' a listed species), are so 
much higher than the threshold required to merely initiate consultation 
(that a species might be affected, even if purely beneficially), these 
marginal to no impact consultations end up amounting to delay and cost 
for little conservation benefit. Moreover, the trend toward lowering 
the thresholds to initiate consultation is severely impacting the 
ability of other Federal agencies, perhaps most notably the Corps of 
Engineers and the EPA, to have efficient general or nationwide 
permitting programs. The lower thresholds mean that many projects with 
little or no impact, that might otherwise have only the briefest of 
interchanges with the Federal Government, are instead kicked into an 
ESA consultation that can cause delays of over a year.
    A very recent example of this trend toward lowering of consultation 
thresholds are the cactus ferruginous pygmy owl consultation guidelines 
(Attachment ``A'') worked out between the Corps and the Service for the 
Corps' nationwide permitting program in southern Arizona. These 
guidelines define a development project's potential impacts on the owl 
so broadly that consultation would be required on dozens, if not 
hundreds, of projects not located in critical habitat for the species 
and in fact miles and miles from any known owls. Moreover, because the 
guidelines state that, where consultation is triggered, the Corps will 
require applicants to obtain an individual permit from the Corps, a 
time-consuming and expensive process, even though the project would 
otherwise qualify for a much more efficient nationwide permit 
authorization. These guidelines have the effect, therefore, of 
increasing the work load of two Federal agencies and increasing the 
time and cost associated with projects' Federal environmental 
approvals, all in exchange for little if any real species conservation. 
To its credit, the Service is beginning to recognize the inefficiencies 
of these guidelines and has expressed an interest in working with 
appropriate stakeholders to improve the process.
    A similar example of lowering the consultation threshold occurred 
with the Service's Edwards Aquifer Water Quality Recommendations 
(Attachment ``B'') in central Texas These guidelines have since been 
withdrawn as a result of a settlement in a lawsuit we filed on behalf 
of the National Association of Homebuilders. However, prior to the 
withdrawal of these guidelines, they operated in a manner very similar 
to the cactus owl guidelines. Under the aquifer guidelines, the 
position of the Service was that every development project in a 350-
square-mile area should consult with the Service regarding potential 
impacts on the endangered Barton Springs salamander, a small amphibian 
that lives in the Barton Springs swimming pool in Austin's Zilker Park. 
The Federal trigger for these consultations was the otherwise very 
efficient EPA general permit for construction-related stormwater 
discharges applicable to every development project over five acres. The 
Service's position requiring consultation was contrary to its often-
stated view that no single project would result in harm to the 
salamander. In this case, the lowered consultation threshold resulted 
in more than mere delay for a number of projects. Applicants were 
entitled under the EPA general permit to conduct ``informal'' 
consultations with the Service, but if differences could not be 
resolved in informal consultation, the general permit did not authorize 
resolution through formal consultation. In other words, applicants were 
stuck in a Catch-22; they were required to initiate informal 
consultation with the Service, but could not require the Service to 
finally ``put it in writing'' in formal consultation. The Service was 
overtly telling developers, ``if you agree to these project 
modifications, we will let you out of the consultation; if not, you're 
stuck.'' With no practical way for applicants ultimately to hold the 
Service accountable for its extractions, most applicants simply gave up 
and made concessions that in most instances could not have been 
required of them if consultation were properly concluded.

III. Delay as a Tool of Extraction
    One of the frequently cited benefits of the ESA Section 7 
consultation process is that, unlike the process for approving habitat 
conservation plans under Section 10(a), it is subject to specific and 
generally reasonable statutory timeframes. For example, formal 
consultation is required to be concluded within 135 days. 
Unfortunately, at least in my experience, these timeframes are observed 
much more often in the breaches than in compliance. While this fact may 
largely be due to the heavy workload and limited budget of the Service, 
it can and does give rise to an implicit trading of processing time for 
conservation benefits that would not otherwise be the obligation of the 
applicant to provide. For the private sector, particularly on larger 
activities or projects such as pipelines and large-scale developments, 
time is very, very expensive, and the time it takes to process 
environmental approvals may directly affect a project's competitive 
position. The Service sometimes takes advantage of this fact by, either 
implicitly or expressly, offering an applicant a quicker turnaround if 
they make concessions. This practice would not be particularly 
disturbing if the concessions were those that could lawfully be 
required by the Service at the end of a normal process. But, it has 
been the case repeatedly in my experience that the concessions are 
purely a trade for quicker processing.
    A good example of this circumstance is the so-called ``alternative 
consultation process'' informally adopted by the Service for the 
Navasota ladies tresses (``NLT'') (a species of orchid). (See 
Attachment ``C,'' correspondence and draft Notice of Intent to Sue). 
Under this alternative process, projects, principally pipelines and 
some real estate developments, which may affect NLTs or their habitat, 
can simply offer to pay a per-acre conservation fee and receive an 
expedited approval through consultation. Because the fee, even at tens 
of thousands of dollars, often pales in comparison to the project cost 
of unspecified delay, many applicants happily pay it. Indeed, this 
would be a beneficial arrangement for all involved, if at the end of 
the day the fee was legal. However, because plants are not protected 
under the ESA Section 9 ``take'' prohibition, there is no lawful basis 
for this fee. The Service is simply selling time.
    Another problem that arises with respect to consultation timeframes 
is the Service's understandable, though not lawful, desire to delay the 
initiation of consultation or extend the period of consultation beyond 
the statutorily required timeframe in order to allow the applicant to 
gather more data concerning the species in question. Many species can 
be observed only seasonally and for short durations. In these 
circumstances, the Service is too often tempted to seek to require 
delays in order to allow for more complete survey data. The Service's 
own regulations and the courts, however, reject that approach. 
Information is never perfect, and the Service is required to make its 
judgments based on the data available within the statutorily prescribed 
timeframe. Recently, I was involved in a large, regionally important 
infrastructure project which, although it had received all of its major 
Federal environmental approvals, faced the potential of significant 
delay to allow time to perform some additional surveys for a plant.

IV. Draft Jeopardy Opinions
    With the much-publicized statistic of how few final jeopardy 
opinions the Service renders per year in ESA consultations, it is 
surprising that I have personally been involved in at least four 
written draft jeopardy opinions and several more specifically promised 
if my client refused to relent. Again, this is an area in which the 
Service is making progress, but, at least up until the recent past, in 
my experience the Service's issuance, or overt threat of issuance, of 
draft jeopardy opinions, can be another unwarranted tool of extraction. 
Attachment ``D'' includes two attorney letters responding to draft 
jeopardy opinions issued on projects in Pima County, Arizona. In both 
instances, the draft opinions were based on clearly erroneous 
understandings of the applicable regulations and facts. Also, in both 
instances, the draft opinions were accompanied by demands for the 
applicant's provision of costly mitigation which, at least in my view, 
far exceeded the Service's authority to require. In the instance 
involving the Pima pineapple cactus, the mitigation was ultimately 
reduced from an initial demand that the applicant purchase and 
permanently protect 400 acres of cactus habitat, to a payment of less 
than $20,000 to a research program. In the instance involving the 
cactus owl, due to severe economic pressure to avoid further delay, the 
applicant largely relented to the mitigation demand, even though there 
were no owls on the project site and the applicant proposed of its own 
accord to leave approximately half of the property in its natural 
condition.

V. Conclusion
    Recently, I have observed the Service making significant strides to 
improve the ESA consultation process. Difficulties nonetheless remain, 
and I consider it appropriate and beneficial that this Subcommittee is 
directing its attention to these issues.
                                 ______
                                 

                                 
                               __________
   Statement of John F. Kostyack, Senior Counsel, National Wildlife 
                               Federation

    Good morning, Senator Crapo and members of the Subcommittee. I am 
here to testify on behalf of the National Wildlife Federation, the 
nation's largest conservation education and advocacy organization. I 
appreciate the opportunity to come here today to talk about the 
consultation process under Section 7 of the Endangered Species Act 
(ESA). I would like to make three observations about our 30 years of 
experience with this key feature of our nation's most important 
wildlife law, and provide three policy recommendations for the future.
            lessons from 30 years of implementing section 7

1. Section 7 is Fundamentally Sound
    A key focus of today's hearing is the Subcommittee's March 22, 2002 
request to the General Accounting Office (GAO) for a study of the 
Section 7 consultation process. Although the request letter is 15 
months old and the Subcommittee's views on Section 7 may since have 
evolved, it is nonetheless important that its assertions not be left 
unrebutted.
    The Subcommittee's effort to gather statistical information about 
how Section 7 operates makes sense. However, the request letter to the 
GAO is harshly and unfairly critical of the consultation process. 
Contrary to the arguments in the letter, Section 7 consultations have 
not consumed inordinate time and money. In fact, this key provision of 
the ESA has accomplished a great deal of conservation with a relatively 
small investment of Federal resources. As with any statutory provision, 
improvements could be made with implementation of Section 7; but the 
basic structure of the consultation process is a good one and should be 
left undisturbed.
    Section 7 contains several crucial tools for conserving the 
nation's threatened and endangered species and the ecosystems on which 
they depend. Particularly important is Section 7(a)(2), which requires 
all Federal agencies that carry out, fund or permit actions affecting 
listed species to consult with the U.S. Fish and Wildlife Service (FWS) 
or the National Oceanic and Atmospheric Administration (NOAA) on 
avoiding jeopardy and critical habitat modification in connection with 
those actions. This consultation provides a crucial opportunity for the 
Federal Government to ``look before it leaps'' into potentially harmful 
activities. As a result of the thousands of Section 7(a)(2) 
consultations that take place every year, Federal agencies now 
routinely adjust their actions to protect imperiled species while 
carrying out or facilitating economic activities.
    Another key tool, although given far less attention than Section 
7(a)(2), is the Section 7(a)(1) conservation provision. Section 7(a)(1) 
requires all Federal agencies to develop and implement a program to 
conserve listed species, and to do so in consultation with FWS or NOAA. 
In enacting Section 7(a)(1), Congress wisely put the burden on all 
Federal agencies engaged in activities affecting listed species to help 
promote the ESA's goal of species recovery, and to consult with the 
expert wildlife agencies in devising their strategies for fulfilling 
this conservation duty.

2. Section 7 Consultations Provide Important Benefits to Listed Species 
        Even in Cases When Neither Jeopardy Nor Adverse Modification of 
        Critical Habitat is Found
    At the heart of the Subcommittee's March 2002 letter is the concern 
that only 0.3 percent of projects reviewed under Section 7 between 1996 
and 2002 were found to jeopardize a protected species or to adversely 
modify critical habitat. The Subcommittee infers from this statistic 
that ``only one out of every 300 consultations involved a project with 
a potential to violate the ESA,'' and that resources are therefore 
being wasted on ``elaborate consultations on projects that pose no 
significant threat to species.''
    This is simply not an accurate depiction of reality on the ground. 
The fact that no jeopardy and no-adverse-modification conclusions have 
been the outcomes of most consultations is not evidence that the 
projects under review had no potential to violate the ESA, or that they 
posed no significant threat to the species. In fact, the thousands of 
consultations with no jeopardy and no-adverse-modification outcomes 
mostly represent species conservation success stories. Rather than 
responding to evidence of potential ESA violations with enforcement 
actions, Federal wildlife agencies have worked collaboratively with 
action agencies and others to negotiate ``win-win'' solutions solutions 
where projects move forward after adjustments are made to avoid 
unnecessary damage to fish, wildlife and plant species and their 
habitats.
    Examples of these ``win-win'' outcomes can be found across the 
country. For example, in Florida, when you drive across the portion of 
Interstate 75 known as Alligator Alley, you can see the results of a 
consultation between FWS and the Federal Highway Administration 
concerning the impact of I-75 improvements on the endangered Florida 
panther. Tucked under the highway are several wildlife crossings that 
allow the panther to roam across its range while avoiding vehicle 
collisions. These crossing now serve as models for other wildlife 
passages planned elsewhere in the country.
    In Nebraska, the Whooping Crane Critical Habitat Maintenance Trust 
is using income from a $7.5 million endowment, created as the result of 
a Section 7 consultation, to finance habitat protection, land 
acquisition, and other programs to conserve the critically endangered 
whooping crane and other species threatened by dam-building along the 
Platte River. On the Upper Colorado River basin, as a result of a 
cooperative program stimulated in part by Section 7, the Bureau of 
Reclamation is altering the timing and magnitude of releases from a 
series of dams to help address habitat requirements of the endangered 
fishes downstream.
    Progress has been slower on the Klamath, Missouri, Rio Grande and 
other river ecosystems where fish, wildlife and plant species hover on 
the brink of extinction, but thanks to Section 7, these species are 
finally receiving some attention. In the absence of Section 7, there 
would be little hope for the coho salmon of the Klamath Basin, the 
pallid sturgeon and piping plover on the Missouri, the silvery minnow 
on the Rio Grande, or the natural systems for which these species serve 
as indicators. Section 7 represents our best hope for achieve a balance 
among development and conservation goals in our river basins and other 
ecosystems, so that both people and wildlife can thrive. 3. The Vast 
Majority of ESA Consultations are Streamlined
    The Subcommittee's letter asserts that ``each of these [ESA Section 
7] consultations requires extensive studies and reports by the Federal 
action agency and one or both of the Services, and extends for months 
or years before ending with the inevitable no-jeopardy finding that is 
so often obvious from the start.'' In fact, the vast majority of 
consultations are informal ones involving minimal time or paperwork. 
FWS statistics show that roughly 97 percent of its consultations from 
1996 through 2002 were resolved informally. NOAA Fisheries' statistics 
for 2001 also show that the vast majority of its consultations are 
resolved this way.
    Informal consultations are, by definition, those that are resolved 
with ``no adverse effect'' findings by FWS or NOAA Fisheries. Under 
Section 7 regulations, such a finding does not have any paperwork 
requirements, and there is no need for a formal consultation or a 
biological opinion. Often, ESA compliance issues are resolved in a 
single phone call, memorialized with a one paragraph letter.
    Despite the streamlined nature of the informal consultation 
process, significant conservation benefits are realized. In an informal 
consultation, FWS or NOAA will often recommend modifications to project 
proposals that, if adopted, will lead to a no-adverse-effect 
conclusion. Harm to the species is avoided, and the project goes 
forward without significant disruption.

            RECOMMENDATIONS FOR THE FUTURE OF THE SECTION 7

    CONSULTATION PROGRAM
    Set forth below are NWF's policy recommendations for the procedural 
aspects of the Section 7 program. NWF's recommendations regarding 
Section 7's critical habitat protection were provided in my testimony 
before the Subcommittee 3 months ago. If requested, I would be pleased 
to provide additional recommendations on how to make the remaining 
substantive protections of Section 7 work more effectively.

1. Greater Transparency into Consultation Outcomes Is Needed to 
        Systematically Evaluate the Performance of the Section 7 
        Program
    In its March 2002 letter, the Subcommittee requests that the GAO 
investigate the disposition of consultations by obtaining statistics on 
the following outcomes: withdrawal by requesting agency; modification 
of proposed agency action; issuance of biological opinion; issuance of 
letter of concurrence that formal consultation is not required due to 
``not likely to adversely affect'' finding. Unfortunately, nowhere in 
the March 2002 letter is there a request for information concerning 
what conservation measures were put in place, and what actions harmful 
to listed species were avoided, as a result of Section 7 consultation. 
In the absence of such information, it is extremely difficult to 
evaluate the relative costs and benefits of the Section 7 process.
    To ensure that Section 7 works as effectively as possible, Congress 
should fund a comprehensive program for tracking the results of 
consultations and monitoring the performance of resulting conservation 
measures and programs. The data should be made available on the 
Internet for public inspection. If such steps were taken, Congress, the 
Administration and the public would be in the position to discuss and 
debate species conservation strategies based on a comprehensive look at 
past implementation of Section 7 on the ground.
    Interestingly, the habitat conservation planning (HCP) program 
under Section 10 of the ESA, which governs non-Federal activities, has 
already achieved far greater transparency than the Section 7 program 
governing Federal activities. All permits and corresponding HCPs are 
currently listed on the FWS website, and the various documents 
reflecting the terms of each of the permits and HCPs are available for 
public review in a centralized library. Moreover, as a condition of 
receiving a permit under Section 10, applicants must agree to submit 
annual reports with data concerning permit implementation.
    At a minimum, the level of transparency in the Section 7 program 
should be brought up to the level of the Section 10 program. 
Considering that Section 7 is applied in so many more circumstances 
than Section 10 (roughly 77,000 Section 7 consultations were completed 
in fiscal year 2002 versus less than fifty Section 10 permits issued), 
the need for a systematic evaluation of the Section 7 program is 
arguably greater than with the Section 10 program.

2. Provide Funding to Enable the Wildlife Agencies to Respond to their 
        Ever Increasing Workload
    In its March 2002 letter to GAO, the Subcommittee requests that GAO 
investigate several possible inefficiencies, such as duplication of 
work by FWS and NOAA, that might be causing delays in the consultation 
process. Eliminating inefficiencies is a worthwhile objective, one that 
the wildlife agencies themselves have been working to achieve for 
several years now with, for example, the increased use of programmatic 
consultations and multi-stakeholder consultations. However, eliminating 
inefficiencies alone will not solve the delay problem. Inadequate 
funding of the wildlife agencies is the single biggest obstacle to the 
timely completion of consultations.
    So long as species continue to be placed at risk of extinction by 
human activity, more species listings are inevitable. Each increase in 
the number of listings inexorably leads to more Section 7 
consultations, as Federal agencies proposing projects encounter greater 
numbers of listed species on the landscape. Continued growth in human 
populations and in the size of the economy means that there are ever-
increasing numbers of Federal projects being proposed that require 
Section 7 review. Also, the expansion of the HCP program begun in the 
1990's means that there are also increasing numbers of non-Federal 
projects requiring review by FWS and NOAA biologists.
    Congress should acknowledge these trends and provide the funding 
needed by wildlife agencies to implement Section 7 successfully. 
Although ESA funding has increased in recent years, funding levels 
remain ridiculously low considering the enormity and complexity of the 
challenges facing the agencies. Moreover, the rate of funding increases 
has not kept up with the rate of increase in the workload. For example, 
in the past 7 years, the number of formal consultations handled 
annually by FWS has grown fivefold while the consultation budget has 
only grown three-fold.
    To ensure that Section 7 continues to protect listed species 
without inordinate project delays, the budgets of FWS and NOAA 
Fisheries must be increased to reflect the added responsibilities.

3. Reject ``Self-Consultation'' Initiatives Currently Being Proposed by 
        the Administration
    Finally, it is essential that Congress reject the Administration's 
current proposals to expedite project approvals by rolling back Section 
7 safeguards. Rather than provide the obviously needed funding 
increases to enable Federal wildlife agencies to fulfill their mandate 
to conserve listed species, the Administration would remove crucial 
regulatory tools that the wildlife agencies need to be effective.
    For example, on January 24, 2003, the Administration issued an 
Advanced Notice of Proposed Rulemaking calling for the EPA, not FWS or 
NOAA, to make no-adverse-effect determinations concerning proposed 
pesticide registrations. By eliminating EPA's duty to engage in 
informal consultations and to obtain FWS's and NOAA's concurrence in 
no-adverse-effect findings, the Administration would remove the 
wildlife experts from the picture, leaving listed species and their 
habitats increasingly vulnerable to pesticide contamination. EPA, which 
has long simply refused to uphold its ESA consultation obligations with 
respect to pesticides, would be rewarded for its obstinacy. EPA alone 
would decide which chemicals would be subject to FWS and NOAA's 
scrutiny and which would be shielded from ESA review.
    Similarly, the Administration has issued a series of proposals that 
would greatly reduce the ability of FWS and NOAA to protect listed 
species from the impact of logging operations. On June 5, 2003, for 
example, the Administration proposed to allow the Forest Service, the 
Bureau of Land Management (BLM) and other land management agencies to 
make their own no-adverse-effect determinations with respect to logging 
activities under the National Fire Plan. As with pesticides, FWS's and 
NOAA's ability to protect listed species from threats posed by logging 
would be severely curtailed.
    In its June 5, 2003, proposal, the Administration attempts to 
justify the rollback of protection of species on Federal lands by 
arguing that the land management agencies have sufficient expertise to 
make their own judgments about ESA compliance. However, the Forest 
Service, BLM and other agencies have frequently demonstrated a bias 
toward resource extraction and resource extraction industries. In many 
ESA consultations, wildlife conservation measures were put in place 
only after Federal wildlife agencies negotiated extensively with the 
land management to secure them.
    For thirty years, the Federal wildlife agencies have played a 
crucial role in protecting threatened and endangered species from 
harmful Federal projects. Unlike the land management agencies, which 
have a narrow focus on their particular landholdings, the wildlife 
agencies continually monitor what is happening across the species' 
range and maintain familiarity with the latest science on species 
conservation. Unlike many action agencies, which are charged with 
carrying out or approving economic development projects, Federal 
wildlife agencies have no conflict of interest. Their sole mission is 
to conserve fish, wildlife and plants and the ecosystems on which they 
depend.
    Congress should reject any and all efforts to weaken the ability of 
FWS and NOAA to utilize the Endangered Species Act to conserve our 
nation's imperiled wildlife.

                               CONCLUSION

    Thank you again for the opportunity to testify. I welcome the 
opportunity to answer any questions that the Subcommittee may have.

                               __________
       Statement of Patricia D. Horn, Vice President, Enogex Inc.

    Chairman Crapo and other members of the Fisheries, Wildlife and 
Water Subcommittee, I am pleased to share with you the experiences of 
Enogex Inc. (``Enogex'') concerning the consulting process pursuant to 
Section 7 of the Endangered Species Act (``ESA'').
    My name is Patricia Horn and I am Vice President of Enogex.\1\ Our 
company takes great pride in our environmental performance. We know 
that environmental responsibility is important to the quality of life 
of our customers, the communities we serve and our own employees and 
their families. It is also critical to our success.
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    \1\ Enogex is a natural gas pipeline and energy company that 
operates the nation's 10th largest natural gas pipeline system with 
more than 10,000 miles of pipe, 13 processing plants and 23 billion 
cubic feet of gas storage, principally in Oklahoma and Arkansas. 
Oklahoma City-based OGE Energy Corp. (NYSE: OGE) is the parent company 
of Enogex and Oklahoma Gas and Electric Company (OG&E). OGE Energy and 
its subsidiaries have about 3,000 employees.
    OG&E, a regulated electric utility, serves approximately 720,000 
retail customers in a service territory spanning 30,000 square miles in 
Oklahoma and western Arkansas, and wholesale customers throughout the 
mid-continent region. OG&E has eight power generating facilities with 
combined capacity of approximately 5,700 megawatts.
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    We are a company committed to complying with and, when possible, 
exceeding government-established environmental standards. We seek to 
continually monitor, assess and improve our environmental performance. 
We also seek to foster strong working relationships with the local, 
State and Federal agencies that monitor our environmental stewardship.
    Finally, we believe we have a dual responsibility to protect our 
natural resources and to provide safe, reliable and reasonably priced 
power and gas transportation services. The company will, therefore, 
bring to any emerging environmental policy discussion the need for a 
sensible balance between environmental gain and its resulting costs and 
resources.
    The purpose of this testimony is to outline the historical 
interpretation and the more recent philosophy and change of the U.S. 
Fish and Wildlife Service (``USFWS'') in its informal and formal 
consultations relating to protection of an endangered species believed 
to exist in areas where Enogex conducts pipeline construction 
activities in Oklahoma and Arkansas.

Background
    Enogex and the oil and gas industry conduct a wide variety of 
operations from construction of well pads and access roads to laying 
gathering and transmission pipeline systems for the delivery of natural 
gas to intra and inter-state markets. Enogex conducts its activities in 
the majority of counties in Oklahoma and in numerous counties in 
Arkansas.
    In order to proceed with oil and gas construction activities, 
Enogex requests applicable environmental clearances or informal 
consultations relating to any endangered species that may be present in 
the areas of the planned construction. Enogex requests these clearances 
from the USFWS. An endangered species, the American Burying Beetle 
(Nicrophorus americanus) (``ABB'') has been identified as existing in 
Oklahoma and Arkansas.
    The ABB was listed as endangered in 1989. At the time of listing it 
was believed that there were only populations in Rhode Island and 
Oklahoma. As of 2002, populations are now known from Rhode Island, 
Oklahoma, Nebraska, South Dakota, Kansas, Massachusetts and Arkansas. 
The beetle is listed as existing in 17 Oklahoma Counties and 4 Arkansas 
Counties. It is suspected in other counties in these two States. (These 
known and suspected counties will be referred to as ``the ABB 
Counties'')
    The ABB is a large beetle that ranges from 1 to 1.5 inches in 
length, has four red-orange spots on its wing covers, and is 
distinguished by its larger size and its orange-red pronotum. The 
beetles are habitat generalists, occurring in many different habitats. 
They feed on carrion and lay their eggs in or adjacent to a buried 
vertebrate carcass. It is suspected that carrion availability in a 
given area is more important than the vegetation or soil structure. The 
beetle is typically active in Oklahoma and Arkansas from mid-May to 
mid-September. Adults are presumed to be an annual species, fully 
nocturnal and are usually active only when nighttime temperatures 
exceed 60 F (15C). The remainder of the year it hibernates. The ABB has 
been recorded traveling as much as 2 miles per night.

Historical Treatment
    Historically, Enogex has requested environmental clearances 
relating to any endangered species in the ABB Counties from the USFWS 
in Tulsa, Oklahoma and Conway, Arkansas. Informal consultations 
relating to projects being initiated in the ABB Counties have always 
resulted in a ``no adverse impact'' finding by the USFWS. Such 
clearances from the USFWS were typically determined within a few days 
to a little more than a month with the responses generally provided 
within 30 days. Accordingly, projects received clearances and were 
allowed to proceed without delay.
    Enogex's main construction activities relate to laying gathering or 
transmission pipeline to connect producing natural gas wells to its 
pipeline system to allow the produced natural gas to be marketed. To be 
competitive and allow Enogex the ability to provide these services, 
wells must be connected efficiently and without delay. It is not 
feasible to begin the construction of the connecting pipeline until it 
is determined that a well being drilled will produce in commercial 
quantities. Upon this determination, Enogex customers expect and demand 
that the pipeline be constructed and placed in service without delay to 
transport the natural gas produced to the market place. If Enogex is 
unable to predict and understand the timing required to timely complete 
its construction, it cannot be competitive and meet the expectations of 
the well operators, working interest owners or royalty owners in the 
producing well.
    Prior to late 2002, Enogex submitted environmental clearance 
requests or informal consultations to the USFWS for the ABB Counties 
and received clearances that either no endangered species were present 
or, if present, the proposed project would have no adverse effect on 
the ABB. During years 2000 through 2002, Enogex submitted 54 informal 
consultations to the Tulsa, Oklahoma USFWS and 46 to the Conway, 
Arkansas USFWS and each time received the clearances to proceed with 
the planned pipeline construction. A change in these clearances being 
granted without comment began in July, 2002.

Initial Change in Consultation Process
    By letters dated July 16 and 18, 2002, Enogex was advised by the 
USFWS that two proposed pipeline projects in Latimer County, Oklahoma 
were in the vicinity of where the ABB may occur. The USFWS, at this 
time, recommended that the pipeline projects be implemented outside the 
ABB's active period (early October through April) and thereby avoid 
impacts on the species. If this recommendation was not feasible, the 
agency recommended continuously baiting beetles away from the project 
area using chicken parts or mice to ensure that beetles would not be 
adversely impacted by the proposed projects. The USFWS advised that if 
the proposed projects could be implemented outside of the beetle's 
active period or if the recommended baiting protocol was followed, then 
the ABB would not likely be adversely impacted by the projects. 
Therefore, no further Section 7 consultation would be needed.

Drastic Change in Consultation Process
    In October, 2002, in response to requested informal consultations 
relating to pipeline construction projects to connect two recently 
completed natural gas wells in Latimer County, Oklahoma, Enogex was 
advised by USFWS of a drastic change in treatment relating to the 
USFWS's informal consultation policy relating to the ABB. The USFWS 
advised that sufficient site-specific information on the occurrence of 
beetles within the project areas was not available and that therefore 
the USFWS could not provide an accurate assessment of the impacts of 
the projects on the species. The USFWS recommended that Enogex conduct 
a survey for the presence of the ABB in the project areas. The USFWS 
advised that the survey should be conducted by a biologist with 
knowledge of the life history of the ABB and who has a Section 10 
permit from the USFWS to conduct such surveys. Due to the beetle being 
active only during the warm summer months, the USFWS advised that the 
survey could only be conducted between late April and early September. 
If beetles were observed, further Section 7 consultation would be 
required.
    If Enogex could not proceed until after a survey in the summer, the 
connection of these newly completed wells by Enogex would be delayed by 
at least 8 months. Enogex responded quickly to understand the request 
and data that would be required to properly initiate a formal 
consultation immediately. Enogex retained a biologist to conduct field 
surveys. It consulted with the EPA to determine what further 
information needed to be provided to EPA so that a formal consultation 
could be requested. Enogex provided detailed project information, 
construction protocol, operations and maintenance protocol, geological 
survey maps, survey plats, storm water pollution prevention plans and 
recently completed habitat surveys to the USFWS and EPA. The EPA formal 
consultation letter was sent to USFWS on November 27, 2002. The final 
Biological Opinion (``BO'') from the USFWS was received on January 23, 
2003.
    The BO issued by the USFWS determined that after reviewing the 
current status of the ABB, the environmental baseline for the action 
area, and the cumulative effects of the proposed action, the projects 
were not likely to jeopardize the continued existence of the ABB across 
its entire range. No critical habitat has been designated for this 
species, therefore none was affected. The BO provided numerous 
restrictions, implementation of required terms and conditions relating 
to construction practices and established a permitted take.

Immediate Effects of Change to Pending Commercial Well Connects
    As noted, these most recent requests for consultations to the USFWS 
related to two recently completed natural gas wells ready to produce 
natural gas to the market place. One of the wells was not connected to 
Enogex and the connection was awarded to a competitor. This resulted in 
significant revenue loss to Enogex exceeding $1,000,000 over the life 
of the well. Additionally, because the delay prevented the natural gas 
in the well from reaching the market, the well producer lost 
approximately $2,000,000. After receipt of the BO by Enogex and 
extensive education and training to its operators and contractors, the 
second well was connected to Enogex. The delay in the treatment of the 
ABB consultation resulted in a loss to Enogex exceeding $150,000. 
Additionally, the delay caused the well producer to lose approximately 
$2,500,000 because the natural gas in the well could not get to the 
market.

Future Implications
    This recent change in treatment and approach of the ABB by the 
USFWS is not based on any new data or science about the ABB. Instead, 
it is our understanding that this change is based upon new 
interpretation of existing data differently from previous reviews. 
Currently, the USFWS is responding with a very aggressive approach for 
the purpose of preservation of the ABB. Enogex has been informed that 
all proposed construction projects located within the ABB Counties will 
be exhaustively scrutinized and formal consultation initiated.
    If a pipeline, oil and gas operator or other construction company 
wishes to construct during the ABB hibernating season (late September 
to late April) and the project triggers a Federal nexus, the company 
will be required to enter into formal consultation with the USFWS. The 
result will be the issuance of a Biological Opinion that will State 
restrictions, construction practices and permitted take of the species. 
Such consultation, if not delayed, is required to be completed within 
135 days after the Formal Consultation is officially requested. A 
Federal nexus trigger includes projects that exceed 5 acres of soil 
disturbance, cross jurisdictional waters or involve mechanized clearing 
of forested wetlands, and include all FERC regulated projects.
    The USFWS has noted construction activities presented to it for 
consultation in the ABB Counties in 2002 included pipelines, roads, 
cell towers, residential developments, bridges, mining, petroleum 
production, sewer lagoons, commercial developments, recreational 
developments, fiber optics, cable and electrical lines and water 
treatment facilities. Clearly, the implications of this new procedure 
and expansive interpretation of the ABB data will have far reaching 
effects to any construction activity in these ABB Counties.
    As noted, Enogex's experience in the past is that it took 
approximately 30 days to receive clearances to proceed with pipeline 
construction. Under the new interpretation, the USFWS has 135 days to 
complete the formal consultation. The most recent construction projects 
for which formal consultations were entered into by Enogex took 
approximately 4 months to receive what the USFWS called ``expedited'' 
clearance.
    In addition, Enogex has been required to hire a third party 
biologist to survey the proposed project area for the presence of the 
beetle. These surveys are time consuming and expensive to complete. 
Enogex estimates an average of $5,000 is incurred for each project in 
order to provide data relating to the specific area and the presence or 
absence of the ABB.
    Enogex (and all effected parties) will be required to expend 
enormous resources of time, energy and money to establish construction 
programs, training, third party experts and to implement the expansive 
conditions and requirements to meet the conditions now being imposed by 
the USFWS in these areas. Such additional costs and burdens must be 
questioned when it has not been established that necessary preservation 
or recovery of the ABB will result.
    It is also believed that this new, expansive approach in the 
preservation philosophy by the USFWS in one district will be 
implemented in other areas. Enogex has recently been advised that this 
same process will be implemented in Arkansas.

Conclusion
    Along with numerous oil and gas industry trade associations such as 
Mid-Continent Oil and Gas Association, Oklahoma Independent Petroleum 
Association, Gas Processors Association and Oklahoma Farm Bureau, 
Enogex is seeking to address the USFWS's procedural changes in the 
protection of the American Burying Beetle. Enogex believes that the 
first step needs to focus on whether the facts present relating to the 
ABB merit this comprehensive and far reaching change in consultations 
and clearances being granted. After accurate and complete data is 
established then the measures necessary to properly preserve this 
endangered species can be implemented. Until this step is undertaken 
and accomplished, actions--such as the recent actions taken by the 
USFWS--only tend to create unnecessary hardship on the agency and 
unnecessary hardship on the public attempting to do business in these 
areas, and they result in no true protection to the ABB. Enogex is 
hopeful that this issue can be resolved without affected parties having 
to resort to a costly and time-consuming litigation process.
    Mr. Chairman and members of this Committee, Enogex appreciates and 
seeks any assistance that this Committee can provide to address this 
critical issue.

                               __________
    Statement of Jim Chilton, Arivaca, AZ on behalf of the National 
   Cattlemen's Beef Association and the Public Lands Council on the 
                         Endangered Species Act

Introduction
    Good morning, Chairman Crapo and Distinguished Members of this 
subcommittee, my name is Jim Chilton and I am a rancher from Arivaca, 
Arizona. My family first started ranching in Arizona in 1888. Arivaca, 
however, goes back much further than that. Father Keno first founded 
the town in 1690 when it became a center for grazing cattle he brought 
with him from Mexico. Today, the town has a population of 1500 people. 
The largest employer in the town and surrounding area is ranching. My 
father, brother, and I run approximately 1,250 cattle on 85,000 acres: 
48,000 acres of Arizona school trust lands; 35,000 acres of Forest 
Service land, and 2,000 private deeded acres. I appreciate the 
opportunity to be here today to provide my story on section 7 
consultation of the Endangered Species Act to the Committee on behalf 
of the sheep and cattle rancher members of the Public Lands Council and 
the National Cattlemen's Beef Association.
    The Public Lands Council (PLC) represents sheep and cattle ranchers 
in 15 western States whose livelihood and families have depended on 
Federal grazing permits dating back to the beginning of last century. 
The National Cattlemen's Beef Association (NCBA) is the trade 
association of America's cattle farmers and ranchers, and the marketing 
organization for the largest segment of the nation's food and fiber 
industry. Both PLC and the NCBA strive to create a stable regulatory 
environment in which our members can thrive.
    Ranching out west has been part of the landscape, the economy, and 
the culture for approximately three centuries. About 214 of the 262 
million acres managed by BLM are classified as ``rangelands,'' as are 
76 million of the 191 million acres managed by the Forest Service. More 
than 23,000 permittees, their families, and their employees manage 
livestock to harvest the annually renewed grass resource grown on this 
land. Western ranching operations provide important additional benefits 
to the Nation by helping to preserve open space and reliable waters for 
wildlife, by serving as recharge areas for groundwater, and by 
supporting the economic infrastructure for rural communities. Our 
policy is to support the multiple use and sustained yield of the 
resources and services from our public lands which we firmly believe 
brings the greatest benefit to the largest number of Americans.

My Story
    Federal land management agencies so seriously misapplied the 
Endangered Species Act (ESA) to the land in my Federal allotments that 
I unfortunately was forced to conclude that the Forest Service and the 
Fish and Wildlife Service (FWS) were using the Act to force me out of 
the business of ranching on historic grazing lands. The agencies took 
these actions even though thirty years of data in the Coronado National 
Forest files, detailed production and utilization studies by nationally 
recognized range management scientists, and reports by numerous other 
researchers showed my allotments to be currently in good condition and 
are on an upward trend in which an exceptional number of high value 
native climax species have been preserved. This struck me as deeply 
unfair, and I was not willing to accept the judgment of their actions 
without a fight.
    I have spent hundreds of thousands of dollars on lawyers and 
litigation and tens of thousands more to have respected range 
scientists and specialists assemble the best site-specific data 
possible. We spent countless hours of work with top-ranking 
consultants, days and weeks of lost time in meetings and legal 
wrangling, and months assembling a mountain of scientific evidence to 
show that cattle grazing does not adversely impact the Sonora chub or 
the lesser long-nosed bat. Even though many other permittees may face 
similar challenges from the land managing agencies, not all grazing 
permittees facing similar Federal actions are able to mount this kind 
of elaborate defense which ultimately proved successful.

Section 7 Consultation: What Went Wrong
    In 1998, a Forest Service biologist asserted that grazing on my 
allotment (``the Montana'' allotment) was likely to adversely affect 
the Sonora chub, a listed species. The adverse call was astonishing. In 
1997, the Forest Service removed 20 acres from the Montana allotment 
along the ``California Dry Gulch'' adjoining the border to protect the 
chub. The excluded area had lush riparian growth and had been part of a 
successful experiment-in-progress to demonstrate that rest-rotation 
grazing could enhance riparian condition. In Arizona Cattle Growers' 
Association v. U.S. Fish and Wildlife Service, 273 F.3d 1229 (9th Cir. 
2001), the court considered the very actions addressed today and found, 
among other things, that the chub ``are essentially confined to the 
California Gulch, an area from which livestock are excluded.'' The 
Southwestern Naturalist, June 1990, describes the Sonora chub as 
abundant in Mexico where the chub dominates its 5,000 square mile 
watershed and constitutes 99.97 percent of the total number of fish and 
96.9 percent of the biomass of the species.
    In a similar vein, a Forest Service botanist concluded in 1998 that 
cattle grazing on the Montana allotment were likely to adversely affect 
the lesser long-nosed bat, a listed species, even though the bat had 
never been found on the allotment. One dead bat was found 10 miles east 
of the allotment in 1959, but that is the extent to which the migratory 
bat has ever had contact with the Montana allotment. Research has shown 
that these bats are not food-limited even on the ranches where they 
have roost caves. No roost sites occur on our allotment.
    Relying on his scientists, the Forest Supervisor signed a 
biological assessment for the Montana allotment in November 1998, 
asserting that grazing could harm the minnow and bat. Once the 
consultation process commenced, the Forest Service and FWS refused to 
allow me or my representatives to participate in meetings or other 
discussions prior to the issuance of the draft FWS Biological Opinion. 
We were excluded even though we had applicant status for the 
consultation. The FWS similarly excluded ranchers from the consultation 
process in the Sierra Nevada consultation process. Of course, the draft 
Biological Opinion represents a largely settled judgment by the agency, 
which may be further adjusted in response to public comments but is 
rarely ever reversed.
    Nevertheless, I had my team of lawyers, range, riparian, soils, and 
fish experts submit comments on the draft Opinion. The final Biological 
Opinion issued by the FWS in April 1999 largely ignored my submitted 
comments in the sense that they did not respond substantively to the 
points. The conditions included by the FWS in the Opinion to benefit 
the chub and bat added an estimated $25,000 of expenses annually in 
managing the allotments. The Forest Service issued a Montana Allotment 
Management Plan in September 1999 that was based on the Biological 
Opinion. The plan allowed for my cattle to use 45 percent of the forage 
and leave 55 percent for wildlife and esthetics. The plan also replaced 
the fixed permit number of 500 cows with a ``range'' of 400 to 500 cows 
per year (subject to annual determination). These restrictions 
decreased the market value of the allotment by approximately $150,000.
    A Federal district court decision struck down the Biological 
Opinion in December 2000. Nevertheless, the FWS and Forest Service 
reinitiated consultation on the chub and bat. A new draft Biological 
Opinion was issued by the FWS in March 2001 eliminated grazing on 1,200 
acres along the California Dry Gulch to protect the chub. I persuaded 
the FWS Field Supervisor through discussions and the presentation of 
exhaustive documentation that the Dry Gulch is an intermittent and 
ephemeral stream, not the perennial stream repeatedly referred to in 
the draft Biological Opinion. The Supervisor ultimately restored the 
1,200 acres that had been withdrawn from grazing. The Ninth Circuit 
issued the Arizona Cattle Growers' opinion in 2001 holding that the FWS 
lacks authority to impose conditions in permits for listed species on 
land where the species had not been found.

               SECTION 7 CONSULTATION: POSSIBLE SOLUTIONS

1. Sound Science
    Perhaps the most obvious failure in the ordeal described above is 
that the agencies failed to use sound science, which in this case 
really equates with common sense, when they embarked on consultation 
for the Sonora chub and the lesser long-nosed bat. These species were 
never found on my allotments, yet the government was prepared to impose 
onerous restrictions on my livelihood to help them.
    Sound science starts with disinterested evaluation of species 
listing and delisting proposals by objective scientists utilizing peer 
review of their work. FWS employees can have their judgment obscured at 
times by their institutional interest in administering the ESA. Because 
of the tremendous impact ESA can have on economics, communities, and 
local land use generally, we believe additional procedures are in order 
to ensure that no interest is unfairly minimized or excluded prior to a 
decision. In particular, we would like the ESA to be amended to require 
the National Academy of Science or some other reputable third party to 
concur in FWS decisions to list or delist species or in the contents of 
Biological Opinions.

2. Applicant Status
    Another major failure of the consultation process in my instance 
was the refusal on the parts of the agencies to allow myself, who was 
legally recognized as having applicant status in the consultation 
process under FWS regulations, or any members of my legal or scientific 
team to participate in any Forest Service and/or FWS discussions, 
meetings, or deliberations prior to the issuance of the draft FWS 
opinion. Numerous times my lawyers asserted that under the law and 
under FWS regulations they had the right to participate in the process 
as applicants and still we were denied access to the discussions about 
my allotment. By not allowing me to be there, I feel that decisions 
were not made based on fact, but instead were based on irrelevant 
factors.
    I would have wanted my oral testimony to be heard and taken into 
account by agency officials in the Forest Service and the Fish and 
Wildlife Service as they made decisions concerning the future of my 
livelihood on the allotment. I would have wanted the agencies to listen 
to presentations by my experts, and then take the testimony of those 
experts into consideration. I would have appreciated some 
responsiveness from the agencies. Instead, we were kept out of the 
discussion completely during the first consultation. Agency 
decisionmaking would have benefited tremendously by a more complete 
illumination of the facts and science affecting the species.
    The general issue is that all members of the public who are 
potentially adversely affected by the results of a consultation under 
the ESA should be permitted, as a matter of law, to participate fully 
in the consultation.

3. Mitigating Alternatives
    If the Forest Service feels it necessary to remove a permittee from 
the land pursuant to the terms of a Biological Opinion issued under the 
ESA, the agency should be required, as a matter of law, to consider 
alternatives to keep that rancher in business. Public land grazing 
keeps many ranchers' operations viable, and to be forced off of the 
land without any rectification could be the kiss of death to many 
public land ranchers. The Forest Service should have to consider if 
other, comparable range is available for the public land rancher to 
graze his cattle on. It is a principle of fairness if land is to be 
taken away, the land should be replaced with equally economically 
viable land.

                               CONCLUSION

    I want to thank you again for this opportunity to present the views 
of the cattle industry with respect to section 7 consultation under the 
ESA. We look forward to working with you to craft legislation that will 
both respect the need to protect species and be respectful of the 
ranchers and their families who have worked western lands for so many 
generations.

                               __________
 Statement of William J. Snape, III, Vice President and Chief Counsel, 
                         Defenders of Wildlife

Introduction
    Thank you, Mr. Chairman and Ranking Member of the Subcommittee on 
Fisheries, Wildlife and Water. On behalf of Defenders of Wildlife 
(Defenders), where I am vice-president and chief counsel, as well as 
our approximately one million members & supporters, I appreciate the 
opportunity to address the value of inter-agency consultation under the 
Endangered Species Act (``ESA'' or ``Act''), 16 U.S.C. Sections 1531 et 
seq., pursuant to Section 7 of the Act. 16 U.S.C. Sec. 1536. I am also 
chairman of the board for the Endangered Species Coalition, which 
represents approximately 400 citizen groups, scientific entities and 
small businesses on behalf of a strong and vibrant Act. See generally 
www. stopextinction.org. My biography was circulated to this Committee 
earlier this year in connection with testimony on ESA critical habitat.
    By definition, my written testimony can merely touch upon the many 
varied consultations now going on across the country. I would be happy 
to answer any questions regarding the policy themes I raise herein. 
Familiarity with Section 7 of the ESA is presumed in this testimony. 
For excellent background information, see, e.g., American Bar 
Association, Endangered Species Act: Law, Policy and Perspectives 
(2002); Stanford Environmental Law Society, The Endangered Species Act 
(2002) at 78-103; and Daniel Rohlf, Jeopardy Under the ESA: Playing a 
Game Protected Species Can't Win, 41 Washburn Law Journal 114 (2001). 
Also relied upon was Senator Crapo's March 22, 2002 letter to the 
General Accounting Office (GAO).
    I wish to make three basic points this morning about the ESA 
consultation process:
    1) Too frequently, the focus of consultation is mere short-term 
survival of the
    species, not recovery, which is (and should be) the true goal of 
the Act;
    2) Species with critical habitat designations tend to fare much 
better in
    consultation than species without such designations; and
    3) The consultation process itself is of value to wildlife and 
humans alike.

                         SURVIVAL VS. RECOVERY

Case Studies: Woodland caribou and grizzly bear
    In our estimation, the current problem over standards in the 
consultation process derive from several questionable changes contained 
in the 1986 Section 7 regulations. One change pertains to the 
definition of ``jeopardize'', which now means, as a result of the 1986 
rules purportedly still in effect, ``an action that reasonably would be 
expected, directly or indirectly, to reduce appreciably the likelihood 
of both the survival and recovery of a listed species in the wild . . 
.'' 50 C.F.R. Sec. 402.02 (emphasis added). At least one Federal court 
has found the Section 7 regulatory standards to be illegal because they 
conflate the notions of ``survival'' and ``recovery'' contrary to 
Congress' intent. Sierra Club v. U.S. Fish and Wildlife Service (FWS), 
245 F.3d 434 (5th Cir. 2001).
    Nowhere is this legal problem more evident than in northern Idaho, 
eastern Washington, and western Montana, where the highly endangered 
woodland caribou hangs by a tether. With only 30-40 individual adults 
left in the U.S. wild, by all scientific accounts this species needs 
all the old growth forest habitat it can get for breeding, feeding and 
sheltering. U.S. FWS, Southern Selkirk Mountain Woodland Caribou 
Recovery Plan (1994). In this same area, a remnant population of 
grizzly bears, numbering no more than a dozen or so in the U.S., is 
also jeopardized by Federal agency actions. U.S. FWS, Grizzly Bear 
Recovery Plan (draft revised, 1993).
    Yet, in example after example, the Forest Service which administers 
most of the woodland caribou's remaining habitat allows actions on 
Federal public lands that harm the species and prevents its 
conservation, almost as if it is managing the species for fingernail 
survival. For instance, the Colville National Forest recently approved 
a request from the Stimson Lumber Company to build a road and secure 
industry access in unroaded forest recovery areas for the woodland 
caribou and grizzly bear; this project will definitely adversely affect 
both species. U.S. FWS, Biological Opinion on the Stimson ANILCA Access 
Easement Project at 58-68. In another instance of woodland caribou 
habitat degradation, the Idaho Panhandle National Forest recently 
announced a doubling of the Chips Ahoy timber sale. 68 Fed. Reg. 33906 
(2003). Other so-called ``salvage'' timber sales in prime woodland 
caribou recovery habitat are still pending. See, e.g., 65 Fed. Reg. 
34654 (2000). Expanded snowmobiling use and trails, some of it illegal, 
is also harming woodland caribou on Forest Service lands. See, e.g., 
Trevor McKinley, Snowmobile Mountain Caribou Interactions, (May 9, 2003 
draft). The grizzly bear is now threatened by a number of increased 
uses on Federal public lands, including the exponential increase in oil 
and gas permits being issued by the Department of the Interior and 
related agencies.

                   THE IMPORTANCE OF CRITICAL HABITAT

Case Studies: Pygmy Owl and Silvery Minnow
    One need read no further than the plain language of the ESA Section 
7(a)(2) to understand the importance of critical habitat during the 
consultation process: ``Each Federal agency shall, in consultation with 
and with the assistance of the Secretary, insure that any action 
authorized, funded, or carried out by such agency is not likely to 
jeopardize the continued existence of any endangered species or 
threatened species or result in the destruction or adverse modification 
of (critical) habitat . . .'' (emphasis added). As the FWS has stated 
in the context of the northern spotted owl critical habitat 
designation, ``the adverse modification standard may be reached closer 
to the recovery end of the survival continuum, whereas the jeopardy 
standard traditionally has been applied nearer the extinction end of 
the continuum.'' 57 Fed. Reg. 1822 (1992).
    Two species in the Southwest the Rio Grande silvery minnow and the 
cactus ferruginous pygmy owl both vividly demonstrate the importance of 
critical habitat for most species during Section 7 consultation. With 
regard to the pygmy owl, the Army Corps of Engineers ended consultation 
on several important estate development projects that would negatively 
impact identified pygmy owl recovery habitat immediately after a 
Federal court vacated the pygmy owl critical habitat designation. 
National Association of Home Builders v. Norton, slip op. (D. Arizona 
Sept. 19, 2001). With just approximately 18 adult pygmy owls identified 
in the United States, and habitat loss and destruction being the key 
factors in the species' decline, this imperilled bird (like the 
woodland caribou and grizzly bear) needs all the prime desert habitat 
it can get. See, e.g., 62 Fed. Reg. 10730 (1997)(final listing rule for 
pygmy owl, emphasizing the central importance of habitat protection for 
the species).
    With regard to the silvery minnow a recent U.S. Court of Appeals 
decision reinforces how critical habitat helps not only individual 
species, but also entire ecosystems. Rio Grande Silvery Minnow et al. 
v. Keys, slip op. (10th Cir. June 12, 2003). It should also be noted 
here that, despite the rhetoric by some to the contrary, this decision 
is balanced and requires only that the Bureau of Reclamation consider 
wildlife imperilled with extinction when dealing with water shortages 
under Federal water contracts. Id.
    Thus, we are extremely concerned by the Bush Administration's 
announcement last month that it will seek to delay once again its work 
on the critical habitat designation for over thirty threatened and 
endangered species. Having successfully engineered its own budget 
crisis, the Administration now seeks to deny affirmative habitat 
protection for those species that most need it, including the pygmy 
owl, including many species that contribute to California's biological 
diversity, and including the bull trout that is negatively impacted by 
U.S. and Canadian forestry actions alike.

               MANY BENEFITS OF THE CONSULTATION PROCESS

Case Studies: Sonoran pronghorn, Lynx, Migratory Birds
    With all due respect, we disagree that: 1) most ``no jeopardy'' 
findings under the Section 7 process are ``inevitable'' or that 2) 
``more and more of these unneeded consultations'' provide ``no 
benefit'' imperilled wildlife species. Crapo Letter to GAO at 1.
    First, the high incidence of ``no jeopardy'' opinions has as much 
to do with the political and economic pressure that project applicants 
apply upon the action agency as it does with the biological integrity 
of the agency actions in question. See Oliver Houck, The Endangered 
Species Act and Its Implementation by the U.S. Departments of the 
Interior and Commerce, 64 University of Colorado Law Review 277, 326 
(1993)(``Taken together, Interior's regulations present a composite 
picture of an agency doing everything possible within law, and beyond, 
to limit the effect of protection under Section 7(a)(2).''). Second, 
even when a no jeopardy opinion is validly written, the statutory 
language (and practice) of the ESA is that ``reasonable and prudent 
alternatives,'' ``reasonable and prudent measures,'' and ``terms and 
conditions'' by FWS or the National Marine Fisheries Service (NMFS) can 
all positively impact the final agency action going through 
consultation. See, e.g., ESA, 16 U.S.C. Sec. 1536(b)(4). Avoidance, 
minimization and mitigation are important concepts in the Section 7 and 
10 processes. See generally Michael Bean and Melanie Rowland, The 
Evolution of National Wildlife Law (1997).\1\
---------------------------------------------------------------------------
    \1\ See also David Malin Roodman, Paying the Piper: Subsidies, 
Politics and the Environment (1996); Elizabeth Losos et al., Taxpayers' 
Double Burden: Federal Resource Subsidies and Endangered Species 
(1993); Thomas Power, Not All That Glitters: An Evaluation of the 
Impact of Reform of the 1872 Mining Law on the Economy of the American 
West (1993)(all three reports highlight examples of Federal agency 
expenditures that are economic and ecological losers).
---------------------------------------------------------------------------
    A case in point is the highly endangered Sonoran pronghorn, of 
which as few as 20 individual adults now inhabit the United States. 
Listed since 1967 when the original voluntary endangered species law 
was passed by Congress, this desert species has declined due to a 
number of individual agency actions that have degraded its habitat, 
most of which is on Federal land (e.g., DOD, FWS, BLM, NPS, Border 
Patrol). A Federal court has ruled, consequently, that the Federal 
family must do a much better job cumulatively assessing and acting upon 
threats to the Sonoran pronghorn. Defenders of Wildlife v. Babbitt, 130 
F.Supp. 2d 121 (D.D.C. 2001). If anything, the subsequent consultations 
pursuant to this judicial decision have usefully identified threats and 
actions impacting the pronghorn. The problem has been getting the 
action agencies to do the right thing. As one of several examples, 
despite recognition that hot desert cattle grazing in the Sonoran 
Desert is adversely impacting the Sonoran pronghorn (an earlier GAO 
study already has concluded that hot desert grazing is an economic 
disaster for the Federal Government), the Bureau of Land Management in 
its ``no jeopardy'' opinion has essentially allowed ``business as 
usual.'' U.S. FWS, Biological Opinion for Five Livestock Grazing 
Allotments in the Vicinity of Ajo, Arizona (2002).
    Another example of proper consultations leading to wiser 
governmental decisions pertains to the lynx and northern national 
forest management. Under court order to designate critical habitat for 
this species, we believe the FWS (and the Forest Service, which tends 
to be the action agency with regard to this species) would help both 
the lynx and the national forest program by rigorously analyzing the 
impact of certain projects upon meso-carnivore protection. See 
generally Leonard Ruggiero et al., Ecology and Conservation of Lynx in 
the United States (1999). However, the recent proposal by the Bush 
Administration to allow the Forest Service to make its own consultation 
decisions on actions ``likely to adversely affect'' listed species 
turns the notion of independent wildlife analysis on its head, and is 
illegal. 68 Fed. Reg. 33806 (2003).
    Similarly, it is blatantly illegal for the Services to allow the 
Environmental Protection Agency (EPA) to opt out of consultations 
altogether with regard to its pesticide approval program. 68 Fed. Reg. 
3786 (2003). As Defenders has noted in detailed comments to the EPA and 
the Services, our Federal Government's top biologists cannot be written 
out of the process to evaluate the safety of new chemicals that come on 
line almost every day. This is an issue not only for many wildlife 
species, and particularly the migratory birds discussed by Rachel 
Carson almost forty years ago, but also for human health.

                               CONCLUSION

    We believe Section 7 of the ESA is fundamentally sound. With 
adequate financial resources, we believe the FWS and NMFS possess the 
ability to streamline consultations (and related environmental reviews) 
when necessary to do so. Long opposed by many industry applicants, we 
believe the time has come to add sunshine to the relatively closed 
Section 7 process in order to better understand the process and to 
potentially fine tune it. Self-consultation by action agencies is not 
the way to go. Holding action agency expenditures accountable to good 
fiscal and ecological oversight is where we should be heading.
    Thank you for your time and attention. I would be happy to answer 
questions or respond to comments.

                               __________
 Statement of Richard Dieker, President of the Yakima Basin Joint Board

                      ESA SECTION 7 CONSULTATIONS

    Chairman Crapo and members of the Subcommittee: I am here 
testifying today on behalf of the Yakima Basin Joint Board, an 
association of major irrigation districts in the Yakima River Basin, 
Washington. The Board has been attempting to work with the National 
Marine Fisheries Service (now ``NOAA Fisheries'') and the U.S. Fish & 
Wildlife Service on Section 7 Endangered Species Act issues for nearly 
5 years.
    As a result of the Services' actions, or more accurately lack of 
actions, the Board has experienced significant hardship, expense, and 
delay which has hindered the legitimate and valuable operation of the 
Yakima Reclamation Project.
    Our experience has led us to conclude the Section 7 consultation 
process is seriously flawed because of the arbitrary, dilatory, and 
negative administration of the process by NMFS and USFWS.
    Both services have often even refused to include the Board in many 
Section 7 consultation discussions, even though the Board has requested 
to be treated as, and has been advised that we are being treated as, an 
``applicant'' in the Section 7 consultation.
    The Yakima Reclamation Project was begun in 1905, and has been the 
backbone of the irrigated economy in the Yakima River Basin since 
construction was largely completed in 1917. The Project includes 6 dams 
in the Cascade Mountains that store winter and spring runoff for use in 
the hot and dry summers. The Project has been completed and operating 
since 1917, except for the Kennewick division which was completed in 
the 1950's. It has been a very successful Reclamation project. More 
information on the history of irrigation in the Yakima River Basin is 
included in Appendix A-1.
    Under Section 7 of the ESA, the Bureau of Reclamation has consulted 
with NMFS and USFWS regarding the operation of the project, to the 
extent the Bureau has discretion in its operations. The Bureau also 
consulted with NMFS and USFWS regarding repair or reconstruction of one 
of the Project dams,
    Keechelus dam, under the Safety of Dams Act. That Keechelus dam 
consultation is the subject of litigation which is still on appeal to 
the U.S. Ninth Circuit Court of Appeals.
    The following issues and relevant information describes the Board's 
consultation experience. More detail about each subject is presented in 
the Appendicessome appendices, which are identified with the same 
letter as in the titles.

      A. SPECIFIC ESA SECTION 7 PROBLEMS EXPERIENCED BY THE BOARD

(1) Consultation Has Cost Board, its Members and their waterusers over 
        $1.7 Million; YBJB scientific expertise
    The Board and its members have incurred and paid more than 
$1,000,000 to its fish biologists, more than $239,902.00 to attorneys, 
and more than $530,000 for dedicated staff time and other costs 
responding to the ESA Section 7 consultations on the operations of the 
Yakima Reclamation Project, on the Keechelus dam repair consultation, 
and for other ESA compliance issues.
    Section 7 consultation costs have been a severe financial burden to 
YBJB landowner/waterusers whose irrigated crop income and production 
have been adversely impacted in the past five (5) years by drought and 
depressed prices of major Project asparagus, fresh fruit (apples, 
etc.), hops, mint and other irrigated crops.
    Attached Appendix ``A-2'' contains more details about YBJB's 
consultation related costs.
    Most of these costs and expenses were required to provide the best 
available science to the U.S. Bureau of Reclamation for its use in the 
Section 7 consultations on the operations of the Yakima Reclamation 
Project and its ESA Section 7 consultation.
    The Board has, since 1992, retained experienced, independent and 
professionally qualified fish biology advisors and consultants: (1) who 
are familiar with, and knowledgeable about, fish, habitat, State and 
Federal laws and regulations and other activities and conditions in the 
Yakima River Basin, the Western United States, Alaska and Canada, and 
(2) who have contributed to the preparation of this testimony and 
statement. Since the listings of the Bull Trout and Steelhead, the 
overwhelming majority of their time has been spent on ESA issues or 
performing research that is directly relevant to and has been used in 
the Section 7 consultation.
    Appendix ``A-3'' contains brief statements describing the 
qualifications of the Board's fish biologists.

(2) Delays in Resolution of the Consultation; Bureau of
    Reclamation consultation chronology
    For nearly 5 years, Tthe Board has been actively involved in ESA 
Section 7 consultation and has helped the Bureau of Reclamation respond 
to issues raised by NMFS and USFWS (the ``Services'') in the Project 
operations consultationproblems for nearly 5 years. The Section 7 
consultation on Project operations is still not complete.
    The Board's Section 7 consultation expenses started in August, 1998 
when a Bureau representative formally notified the Board's president 
that the Bureau was required to consult with NMFS. Previously, the 
Board's biologists had reviewed and commented on the proposed listings 
of the fish. After the consul-tation started, the Board's biologists 
provided input and assistance to the Bureau while the Bureau was 
developing its ``Biological Assessment.'' The Biological Assessment is 
the first step of a formal Section 7 ESA consultation. In 1999, The 
Bureau presented a draft ``Biological Assessment'' to the Services for 
their review and comment. The Bureau submitted a Final Biological 
Assessment to the Services in August, 2000. Under Section 7 and its 
implementing regulations, the Services are supposed to conclude the 
consultation by issuing a ``Biological Opinion.'' Section 7 of the ESA 
requires consultations to be completed within 90 days, subject to 
extension only to 150 days unless the applicant consents to a longer 
period. It has been almost 3 years, over 1000 days, and no Biological 
Opinion has been issued.
    To the Board's knowledge, there has still not yet been no 
resolution of the original basic issues such as the scope of the 
consultation, new issues have surfaced, problems, new problems keep 
surfacing, and there is no realistic timeframe for completion. The 
Services that would allow the Yakima system to function. The twohave 
hired large numbers of staff to deal with new endangered species 
listings, largely designated by themselves, to assist with their 
workload. The effect of agency expansion, however, has only served to 
allow the Services to attempt to ir expanded their authority over 
Yakima Reclamation Project operational and maintenance issues, and the 
extension of consultation far into the future.
    Appendix A-4 is a chronology of consultation activities prepared by 
the Bureau of Reclamation's Yakima Office which shows the Bureau's 
efforts to conclude the consultation.

(3) Consultation requires education and Expense
    The new hires by the Services have often been inexperienced junior-
level biologists who must negotiate complex and contentious technical 
issues. The results of their questionable decisions has required the 
Board to retain recognized experts in fisheries science to more 
correctly examine the issues raised, provide accurate analyses, and 
educate the new hires in the science they are supposed to administer.
    Appendix A-5 contains more detail on this subject.

(4) ESA administrative rules are vague
    The classification of hatchery fish by NMFS under the ESA, and the 
subsequent judicial review of that classification, is a good example of 
the Services' arbitrary interpretation of the ESA. Judge Hogan found 
that NMFS wrongly excluded hatchery fish from the population under 
consideration for listing and sent the issue back to NMFS for 
reconsideration. (See, infra, p. 31) There are many other examples of 
vague administrative rules that wrongly interpret the ESA, including 
the appropriate definition of an ESA ``species'', what is meant by 
``evolutionarily significant'', who determines ``evolutionarily 
significance'', and differences in interpretation of responsibility by 
NMFS and USFWS.
    Another classic example of NMFS arbitrariness is the listing of 
Steelhead trout as threatened. It is known beyond dispute that 
Steelhead are genetically identical to rainbow trout and in fact 
interbreed with rainbow trout. Rainbow trout are plentiful in the 
Yakima River, which supports a trophy fishery for them. Yet, Steelhead 
were listed as threatened, and NMFS has refused to delist them.
    Appendix A-6 contains more detail on these issues.

(5) Impartial analyst or biased advocate?
    The legal structure of the ESA is contrary to the precept of 
keeping scientific data and analysis independent of the influence of 
political objectives. The service which is expected in the ESA Section 
7 consultation process to act as a ``neutral analyst'' while 
determining deciding whether or not to list a species is the same 
service charged with regulating activities which might affect the 
species of concern. The potential for the service to act in its own 
self-interest and expand it's own administrative power and budget is 
obvious. Congress and the executive branch should amend the ESA and/or 
require by regulation an independent review of the species' ``status'' 
to avoid the services' ``conflict of interest'' when the same service 
is responsible for both analysis and advocacy.

           B. ADMINISTRATIVE ERRORS AND ESA MISINTERPRETATION

    During the past decade, NMFS has greatly expanded the ESA list of 
Pacific salmon it considers ``threatened'' or ``endangered''. species. 
The pace and scope of these listings is indicative of obvious, 
substantial flaws with the Services' interpretation and administration 
of the Act. These expensive, time-consuming listing problems can be 
traced back to NMFS policies which redefine the intent and purpose of 
the Act to: (1) conserve genetic diversity rather than protect actual 
species, sub-species, or distinct population segments, (2) redefine the 
unit at risk to be an ``Evolutionary Significant Unit'' or ``ESU'', a 
concept introduced to satisfy the genetic conserva-tion goals only 
incorrectly assumed by NMFS, and (3) further subdivide the units at 
risk. An example of this last problem is the implementation of policies 
to exclude fish of hatchery-origin from listed populations of the same 
population segment, regardless of their relationship to naturally 
spawning fish which was considered and rejected by Judge Hogan, noted 
above and infra, p. 25.
    More detail on this subject is contained in Appendix B.

C. IMPROPER LISTING OF SPECIES; COLUMBIA RIVER SALMON, STEELHEAD TROUT 
           AND BULL TROUT ARE NOT THREATENED WITH EXTINCTION

    Salmon and steelhead in the Columbia Basin have experienced 
declines in abundance since the end of the 19th century[BJI1]. 
Decreased abundance was, howeverin large part, a result of overfishing 
and of an intentional Federal Government decision to develop the 
Columbia River water resources for greater economic benefit. As a 
result, only about 20 percent of the historical habitat remains 
available to spring chinook and steelhead.
    When the Federal Government made the decision to developthose the 
Columbia River's water resources, it also decided to establish 
hatcheries to produce salmon and steelhead to maintain the fisheries, 
and later to supplement natural spawning populations. Those efforts 
were largely successful, in conjunction with the changing ocean 
environment. Numbers of chinook salmon and steelhead returning to the 
Columbia in the last 4 years have been higher than any comparable 
period since the 1930's. Steelhead are not at risk of extinction, yet 
there is no serious discussion of delisting, and the power of the 
Services power keeps expanding.
    Similarly, there is no evidence that bull trout are at risk of 
extinction. Bull trout status now in relationship to their historical 
abundance in the basin is poorly known, mostly because of a lack of 
information on historical abundance. Bull trout were listed because of 
this lack of information, without any actual knowledge or evidence that 
they were at risk of extinction, or even declining in numbers. Natural 
production continues throughout the system and abundance seems to be 
increasing mostly because of a restriction on fishing. Bull trout have 
much lower population densities than steelhead and salmon because, as a 
predator species, lower abundance is a strategy that favors survival in 
headwater reaches and smaller streams. Bull trout are obviously not at 
risk of extinction in the Yakima Basin. Their numbers are stable or 
increasing.
    More detail on this subject is available in Appendix C.

   D. THE UNITED STATES HAS NO LEGAL AUTHORITY TO CHANGE THE USE OR 
REALLOCATE YAKIMA RECLAMATION PROJECT SURFACE IRRIGATION WATER WHICH IS 
OWNED BY YAKIMA RECLAMATION PROJECT LANDOWNER/WATERUSERS; THE U.S. IS A 
``TRUSTEE'' FOR THE BENEFIT OF PROJECT IRRIGATOR LANDOWNER/ WATERUSERS.

    Yakima Reclamation Project landowners and waterusers have, 
according to the United States Supreme Court, a constitutionally 
protected, vested Washington State approved and certificated ownership 
ofrights to Yakima Reclamation Project surface water. and water rights 
pursuant under Federal and Washington State water rights law. The 
Bureau of Reclamation is obligated by law and contract to annually 
deliver to Board members their full annual entitle-ments. The 
Washington State Supreme Court has confirmed that the irrigator's 
Project water rights are only subject only to a substantially 
diminished Treaty fish water rightto protection of fish for 
substantially limited because the Yakama Nation filed a claim in the 
Federal Indian Claims Commission against the U.S., negotiated a 
settlement and was, in 1968, paid $2.1 million by the U.S. as part of 
the final settlement of three (3) land claims plus the Nation's fishing 
diminution claim all of which were dismissed with prejudice. 
Nonetheless, yet both NMFS and USFWS have been attempting through their 
actions to modify or restrict the use of established irrigator water 
rights. The Services continue to attempt to use the consultation 
process to modify these vested water rights despite their own 
regulations which recognize that consultation is required only for the 
Bureau's discretionary acts. The Board does not believe the Bureau has 
legal discretion to take any part of these vested irrigation water 
rights and reallocate them for ESA or any other purpose including fish.
    Appendix D provides additional background on the legal rights of 
Yakima Reclamation Project irrigator landowner/waterusers.

                             E. CONCLUSION

    The Endangered Species Act is important national legislation. The 
Board supports the ESA, but only as it was originally passed by 
Congress. The Board Yakima Basin Joint Board, a group of public water 
suppliers who deliver water supplied by the United States Bureau of 
Reclamation Yakima Project in central Washington State, considers the 
problems it has encountered with the ESA, and particularly in the 
Section 7 Consultation process, to have reached crisis proportions. The 
serious and disabling problems created are the result of erroneous 
administration and administrative interpretation of the Act by the NMFS 
and USFWS, and weakness in the Act itself that permit service errors. 
problems. Testimony on the controversial concepts and abuses in 
administration of the Act has been identified in this presentation.
    Bull trout and steelhead trout are listed as a threatened species 
under the Endangered Species Act throughout the Columbia Basin, 
including the Yakima River when in fact neither species is at risk of 
extinction. Consequently, the Board has had to expend considerable time 
and over one million dollars on legal and scientific advice to maintain 
their constitutionally protected water rights and provide the best 
available science to the Bureau of ReclamationUSBR, NMFS, and the USFWS 
for use in the Section 7 consultation occurring on the operations of 
the Yakima Reclamation Project.
    This ESA burden exists because both bull trout and steelhead were 
listed by services that NMFS and USFWS have misinterpreted the ESA to 
protect genetic diversity, rather than subspecies or distinct 
population segments as defined by the ESAAct. Pacific salmon, 
steelhead, and bull trout in the Columbia Basin are not at risk of 
extinction, but the misinterpretation of the ESA Act has allowed the 
widespread listings of these species through arbitrary internal agency 
policy decisions. These decisions have been upheld by the courts 
because of the great deference the courts show to the services which 
administer the ESA.
    Congress must clarify the ESA to prevent the misinterpretations 
that have resulted in the listing of species that are at no risk of 
extinction. Congress must remove the Services discretion to list 
``ESUs'' rather than subspecies or distinct population segments. 
Congress must take action to correct the flaws in the administration of 
the ESA that have resulted in grievous hardships to water users and 
private land owners, and to prohibit the very controversial genetic 
diversity concepts originating from the services' policy memoranda 
rather than from the congressional legislation. It will be necessary 
that Congress must precisely define its goals, objectives and expected 
actionsbe precisely redefined to , and leave no uncertainty about the 
purpose of the Act and the extent of its authority. Congress must 
provide , as well as providing clear guidelines on agency actions, 
administration of those actions, and the consultation process, and put 
teeth in the provisions, routinely ignored, that consultations proceed 
on time.
    Congress will, by positive action, remove the discretion that has 
caused the Ninth Circuit and other Circuits of the Federal Court of 
Appeals to defer to the services' misinterpretation of the ESA and the 
resulting seizure of power.

                               Appendices

                              APPENDIX A-1

Yakima River Basin, Irrigation in the Yakima River Basin
    and the Yakima Reclamation Project
    The Yakima River Basin (``Basin'') in south-central Washington 
State is the approximate 6,155 square mile, 4 million acre (an area 
larger than the State of Connecticut) surface water drainage of the 
214+ mile Yakima River and its tributaries.
    The Basin is bordered on the west by the Cascade Mountains with 
desert/steppe rangeland on the east, north and south. The Yakima 
River's headwaters are on the eastern slopes of the Cascades and flows 
generally from northwest to southeast until it empties into the 
Columbia River between Kennewick and Richland, Washington.
    Annual Basin precipitation (mostly snow) on the eastern slopes of 
the Cascades during late fall, winter and early spring may exceed 120 
inches but both snow and rain in the irrigated farming areas of Benton, 
Kittitas and Yakima Counties annually average only between eight (8) 
and ten (10) inches.
    Irrigated agriculture, the main economic activity in the Yakima 
River Basin, uses approximately 1,000 square miles of the Basin's area.
            (1) Pre-1905 Irrigation
    By 1902, there were an estimated 121,000 acres under irrigation in 
the Yakima Basin, representing about 25 percent of the present 
irrigable development. This acreage was served by natural flows in the 
river and tributaries, with none of the present large storage dams and 
reservoirs in existence. The natural runoff was inadequate to insure a 
dependable water supply for the development even at the turn of the 
century.
    Because of early over appropriation of available water supply, no 
additional irrigation development for many fertile acres in the Valley 
was feasible unless two things were accomplished: First, existing 
claimants had to agree to restrict their water usage to beneficial use 
and equitable distribution, particularly in the low late summer period; 
and second, water storage was necessary to salvage the early season 
runoff for supplying irrigation needs for new land development.'' 
[Lentz, Review of the Yakima Project and Other Data, (1974), pp. 1-2]
            (2) Post-1905 Irrigation; the Yakima Reclamation Project
    The U.S., between 1913 and 1933, developed the Yakima Reclamation 
Project by constructing six (6) irrigation water storage reservoirs 
(Bumping, Clear Creek, Cle Elum, Keechelus, Kachess and Rimrock) with 
total active capacity of 1,070,700 acre-feet (``a/f''), as well as 
diversion and conveyance facilities between 1906 and 1958 for the five 
(5) major Yakima Reclamation Project divisions (Kennewick, Kittitas, 
Roza, Sunnyside and Yakima-Tieton) plus the Wapato Irrigation Project 
(``WIP'').
    The water storage reservoirs are operated to conserve winter and 
spring water (``runoff'') for release during the low water summer 
irrigation season.
    The Yakima Reclamation Project's 465,000 acres of irrigable land 
annually requires approximately 2,500,000 acre-feet of water to 
successfully grow marketable crops.
    An ``acre-foot'' of water is the amount of water needed to cover an 
acre of land to a depth of one (1) foot of water.
    Yakima Reclamation Project landowner/waterusers have repaid, and 
continue to annually pay, the U.S. for all Yakima Reclamation Project 
construction, annual maintenance, operation and repair of the storage 
reservoirs allocable to irrigation.



    Figure 1. The western portions of the Yakima Basin are forested 
mountains of the Cascade Range, while the eastern, low elevation 
portions of the Basin are arid agricultural and range land. Over 
465,000 acres of agricultural land is served by the Yakima Reclamation 
Project.

                              APPENDIX A-2

Consultation has cost the Board, its members and their waterusers over 
        $1.7 million
            (1) Joint Board Biologist Fees: $1,060,943.00
    Since 1998, the Board has spent $1,060,943.00on biologists. The 
work done by those biologists since that time has either been directly 
related to the Section 7 consultation or has been research that is 
relevant to and useful in the Section 7 consultation.
            (2) ESA-related Attorneys Fees and Cost Estimates:
     $239,902.00
    Joint Board members estimate they have spent at least the following 
amounts on attorneys fees and costs on matters directly related to ESA 
matters. Because of divisions of labor among the members' attorneys, 
the Kennewick Irrigation District's attorneys and the Yakima Tieton 
Irrigation Districts attorneys have spent the most time and effort on 
ESA matters.

                    a. Kennewick Irrigation District
------------------------------------------------------------------------
                                                                  $
------------------------------------------------------------------------
1998.......................................................       12,170
1999.......................................................       18,387
2000.......................................................        5,312
2001.......................................................        6,634
2002.......................................................       16,159
2003 to date...............................................       12,501
                                                            ------------
                                                                 $71,163
------------------------------------------------------------------------

            b. Roza Irrigation District
    Roza Irrigation District estimates that its share of ESA-related 
attorney's fees are approximately $50,000.

                          c. Sunnyside Division
------------------------------------------------------------------------
                                                                  $
------------------------------------------------------------------------
8/98 to 12/98..............................................        2,125
1999.......................................................        7,750
2000.......................................................        5,923
2001.......................................................        9,116
2002.......................................................        3,825
1/03 to 7/03...............................................        5,000
                                                            ------------
                                                                 $33,739
------------------------------------------------------------------------

            d. Yakima Tieton Irrigation District
    YTID estimates that its share of ESA-related attorney's fees are 
approximately $50,000. This does not reflect all ESA-related work done 
for YTID's benefit because YTID's attorneys were splitting the bill for 
their Yakima River ESA-related work between YTID and other clients.
            e. Kittitas Reclamation District
    Kittitas Reclamation District estimates its ESA-related attorneys 
fees have been $35,000.
    TOTAL ATTORNEYS FEES AND COSTS: $239,902.00
(3) ESA-related Staff Cost and Other Cost Estimates: $534,786.00
            a. Kennewick Irrigation District
    Kennewick's Secretary/Manager estimates that he spends a minimum of 
2 days per month on ESA matters. Prorating his annual salary for the 
period since June, 1998 results in a staff time loss of: $63,440.
            b. Roza Irrigation District
    Roza estimates that its Secretary/Manager (now retired and part 
time spends approximately 10-15 percent of his time on ESA related 
matters)
            c. Sunnyside Division
    SVID estimated costs related to ESA: $113,652
    Average Monthly meetings w/ some relation to ESA since Jan 1998:
    At least 7 meetings per month with multiple staff members 
concerning YBJB, WSWRA, AFW, Tri-County, and YRBWEP
            d. Yakima Tieton Irrigation District
    Did not provide estimate
            e. Kittitas Reclamation District

                i. KRD Manager: $29,040

    Average Monthly meetings w/ some relation to ESA since Jan 1998: 
5.5 yrs x 12 months x 5 meetings x 4 hrs per meeting x $22 payscale = 
$29,040
    Meetings include YBJB, KCWP, KRD Board, Manastash Creek, Tucker 
Creek, Taneum Creek, YRBWEP, Tri-County, WSWRA, AFW)

                ii. KRD GIS Staff: $12,562

                iii. KCWP staff: $5000 per yr over 4 yrs: $20,000

                iv. NRCS/KCCD: $7,500 per yr over 4 yrs: $30,000

                v. KCWP/KCCD related activities: $15,000 per yr over 2 
                yrs: $30,000

                vi. Additional District related Costs: $236,092

    YRBWEP: KRD Comp plan and addendum: $130,000
    Taneum Creek Gage Stations and related hardware: $50,000 ($10,000 
per station x 5 stations [Confluence of Yakima, Bruton Ditch, Taneum 
Ditch, Taneum Ck above chute, Mann Ditch]. Taneum Creek Gage Stations / 
operations and related staff time: 5.5 yrs x ave yr $5266 = $28,962. 
Taneum fish passage contract (weir pools at Mann Ditch): $27,130.44.
    Total: $236,092
    TOTAL KRD ESA STAFF TIME AND OTHER ESA EXPENDITURES: $357,694
    TOTAL BIOLOGISTS, ATTORNEYS, STAFF AND OTHER COSTS ATTRIBUTABLE TO 
ESA: $534,786

                              APPENDIX A-3

YBJB Scientific Expertise
    (1) Ernest L. Brannon, Ph.D. is a Professor emeritus at the 
University of Idaho who has specialized in salmonid life history, ESA 
listed salmonid species, engineered habitat, aquaculture and is a 
Distinguished Research Professor in fisheries.
    (2) Steven P. Cramer has been a fisheries consultant to private 
firms, State and Federal agencies, and Indian tribes since 1987, after 
serving 13 years with the Oregon Department of Fish and Wildlife 
(ODFW), where he directed major research programs. Mr. Cramer has 
participated on the Technical Advisory Team set up by NMFS for the ESA 
reviews of both Coho and steelhead on the West Coast. He has worked 
closely with the key NMFS biologists responsible for completing the ESA 
status reviews for anadromous salmonids. He has been the lead author on 
six major reports supplied to NMFS for ESA status reviews of Coho and 
steelhead populations. Three times, Steve Cramer has been contracted to 
guide ESA status reviews for fish populations in an entire State, 
including Coho in Oregon, steelhead in Oregon, and steelhead in 
California. He was selected by Bonneville Power Administration to 
organize and lead a team of Northwest consultants to prepare a series 
of 11 reports on recovery issues of threatened and endangered Snake 
River salmon.
    (3) D. Brent Lister. Mr. Lister is a fishery biologist with 25 
years of experience as a consultant in salmon enhancement and fish 
habitat impact analysis, and 15 years experience as biologist and 
senior program manager with the Canada Department of Fisheries and 
Oceans on both the Pacific and Atlantic coasts. His key expertise is in 
stream habitat utilization and population dynamics of salmon and 
steelhead. Since 1990, Mr. Lister has been retained as a consultant to 
the Yakima Basin Joint Board on ESA consultations and status reviews 
relating to steelhead and bull trout, and on a variety of issues 
concerning river flow regime effects on salmon spawning, and the 
rearing and seaward migration of juvenile salmonids.
    (4) Patrick A. Monk, consulting fish biologist for the Yakima Basin 
Joint Board, an association of major irrigation districts and 
municipalities in the Yakima River. Mr. Monk's has worked on a wide 
variety of fisheries management projects, including Endangered Species 
Act analysis and consultation and designing and conducting field 
studies of fish and their habitats. Mr. Monk holds a Master of Science 
degree in Fishery Resources, University of Idaho (2002), and a Bachelor 
of Science in Zoology, University of Wisconsin-Madison (1989).
    (5) Thomas R. Payne, Certified Fisheries Scientist, is Principal 
Associate of Thomas R. Payne & Associates, Fisheries Consultants, 
located in Arcata, California. He is a specialist in the application of 
the Instream Flow Incremental Methodology (IFIM) to determine the 
impacts of flow alteration on aquatic ecosystems. In the past 15 years, 
he has conducted or reviewed over two hundred instream flow studies on 
proposed and existing hydroelectric and irrigation projects. Projects 
have been located in areas ranging from mountain streams in Hawaii to 
major rivers on the East Coast, with an emphasis on high gradient 
streams in the Pacific Northwest. Work associated with IFIM and 
directed by Mr. Payne includes fish population sampling, habitat 
mapping and typing, hydraulic measurements, habitat use determinations, 
computer simulations, license application preparation, agency 
negotiations, post-project analysis, and expert witness testimony.
    (6) Kenneth L. Witty, senior fisheries consultant, started his 
career in fisheries a district biologist for the Oregon Department of 
Fish and Wildlife (ODFW) in 1963. The focus of his work with ODFW was 
inventory and management of fish resources and inventory and protection 
of their habitats. He administered the Lower Snake River Fish and 
Wildlife Compensation Plan in Oregon. Since retiring from ODFW, Mr. 
Witty has worked with S.P. Cramer and Associates, Inc., focusing on the 
preparation of (1) reports assessing fish populations, trends and risk 
assessments, genetics, competition/predation, and re-introductions, (2) 
biological assessments for the ESA, 404 permits including Section 10 
authorization to sample listed fish, and gravel fill/removal permits, 
(3) habitat surveys, restoration, and carrying capacity estimates, (4) 
hatchery siting, design, and brood stock collection, and (5) passage 
evaluation at main-stem dams.

                              APPENDIX A-4

              Bureau of Reclamation Consultation Chronology
                      YFO O&M consultation timeline
------------------------------------------------------------------------

------------------------------------------------------------------------
6/24/98...........................  *COM001*Request for species list
                                     from FWS to initiate consultation
                                     on YFO operations
7/23/98...........................  ESA Mtg with FWS. Discussion covered
                                     how to approach compliance. OK'd
                                     with a BO for interim period until
                                     IOP complete. FWS approved outlined
                                     process for proceeding with BA.
                                     Reservoir operations (bull trout
                                     access, fluctuations and
                                     productivity, a minimum for Rimrock
                                     pool 10,000AF), activities below
                                     the reservoirs (hydro graphs,
                                     passage at storage dams, show all
                                     diversions, identify screens and
                                     ladders, Clear Cr Ladder),
                                     operations post flip-flop
7/28/98...........................  Memo from BR to FWS concerning
                                     relationship of IOP to consultation
                                     suggesting a meeting
8/10/98...........................  NMFS/BOR discussed biological issues
                                     including, describing the fish
                                     protective facilities, facility
                                     maintenance, instream flows. NMFS
                                     suggests getting data from YN
12/2/98...........................  e-mail from FWS to BR concerning
                                     draft sections of the BA supplied
                                     to FWS
12/4/98...........................  Mtg with FWS @ Moses Lake. FWS
                                     comments on Reclamation data
                                     development and biological
                                     assessment outline. Outline
                                     included w/ agenda.
9/1/1999..........................  Transmit draft BA to FWS and NMFS
                                     and request comments. Hand
                                     delivered to NMFS and made
                                     PowerPoint presentation
10/14/1999........................  Memo from FWS to BR transmitting
                                     comments on draft BA
11/30/1999........................  Met with NMFS to discuss Salmon
                                     Creek and spoke with Fransen about
                                     comments on the draft YFO ops BA
12/1/1999.........................  Meeting with FWS to discuss comments
                                     on draft BA
5/25/00...........................  Met with NMFS to discuss BR
                                     consultations including YFO ops and
                                     Keechelus. NMFS raised issue of
                                     ``jeopardy'' at Keechelus if
                                     passage not included. ``No train
                                     wrecks"
8/7/2000..........................  Sent final BA to FWS and NMFS.
                                     Offered to meet and discuss BA.
9/22/2000.........................  Memo from FWS to BR indicating that
                                     BA was adequate to initiate
                                     consultation which began on August
                                     8, 2000 and was to be completed on
                                     or before December 20, 2000.
12/20/2000........................  135 day consultation period ends on
                                     YFO Ops
1/19/2001.........................  Memo from FWS notifying us and
                                     irrigation districts that FWS was
                                     going to use 60 extension provided
                                     to coordinate more with NMFS and
                                     BR.
2/19/2001.........................  First 60 extension for FWS ends for
                                     YFO ops BO
3/12/2001.........................  2001 Drought Operations Mtg. @ BOR.
                                     Discussion included Rimrock Lake,
                                     Easton Ladder, flushing flows, etc.
3/27/2001.........................  Memo from FWS to BR requesting 60
                                     day extension to provide for
                                     additional coordination with BR.
3/30/2001.........................  FWS/BOR Yakima Field Office Section
                                     7 Consultation Mtg. @ BOR.
                                     Discussion included Legal and
                                     Contractual Considerations, 2001
                                     Operations, Brief overview of BA
4/13/2001.........................  FWS/NMFS/BOR Section 7 Consultation
                                     Meeting @ Kittitas Reclamation
                                     Office. Discussion included FWS/
                                     NMFS comments on Yakima Project
                                     Operations BA, and presentation of
                                     FWS Recommendations on Drought
                                     Operations. 4/6/01 comments by USFW
                                     on the Yakima Operations Biological
                                     Assessment FWS and NMFS commit to
                                     draft BO's in Aug/September
                                     timeframe.
4/30/2001.........................  Letter Received from USFW to the
                                     BOR: Request for Extension on
                                     Section 7 Consultation on the
                                     Yakima Project Operations and
                                     Maintenance. Committed to formulate
                                     BO by July 18 and transmit draft BO
                                     by September 1, 2001
5/11/2001.........................  Meeting with NMFS and FWS to discuss
                                     BA. Discussed 4/30 letter from FWS
                                     to BOR. Handout prepared by Steven
                                     P. Cramer and Ray Beamesderfer
                                     entitled Simulation of Bull Trout
                                     Impacts at Rimrock Reservoir
                                     Resulting form Entrainment at
                                     Drawdown as well as graphs with
                                     fish counts and size
6/7/2001..........................  Two field trips hosted by ID's to
                                     look at irrigation systems
7/18/2001.........................  Per 4/307/2001 request, FWS to have
                                     formulated BO on YFO ops
9/1/2001..........................  Per 4/30/2001 request, FWS to
                                     deliver draft BO on YFO ops
9/17/2001.........................  Meeting with FWS to discuss YFO ops
                                     and Keechelus consultation.
9/21/2001.........................  Meeting with NMFS and WA State to
                                     discuss Keechelus and O&M
                                     consultation. NMFS commits to
                                     assign staff to work on both and
                                     commits to a White Paper on the O&M
                                     consultation
3/15/2002.........................  Conference call with NMFS and FWS.
                                     Both agencies commit to White
                                     Papers outlining there assessment
                                     of affects of the proposed action
                                     on listed species and a jeopardy/no
                                     jeopardy analysis.
6/27/2002.........................  Meeting with NMFS and FWS. NMFS
                                     provides an incomplete internal
                                     review draft of their White Paper
                                     dated 6/26/2002. FWS indicates
                                     their White Paper is still under
                                     development.
7/11/2002.........................  Meeting with NMFS and FWS. NMFS
                                     provides completed internal review
                                     draft of their White Paper. BOR
                                     commits to provide comments by 1
                                     Aug. FWS commits to providing their
                                     White Paper by ``mid-August'' (Aug
                                     16). Agencies lay out tentative
                                     schedule to complete consultation
                                     by Oct. 2003. Includes a peer
                                     review process for baseline and
                                     project affects analysis.
8/2/2002..........................  BR sends comments to NMFS on draft
                                     White Paper
8/19/2002.........................  Conference call to discuss joint
                                     agency letter outlining process and
                                     schedule for completing O&M
                                     consultation. On advice of consul
                                     letter it is decided to delay
                                     sending letter due to Keechelus
                                     lawsuit.
11/20/2002........................  Meeting with NMFS and FWS to discuss
                                     baseline and proposed action. FWS
                                     provides draft version of White
                                     Paper
12/04/2002........................  Meeting with NMFS and FWS to
                                     continue discussion about baseline
                                     and proposed action. Comments on
                                     FWS White Paper discussed. FWS
                                     agreed to lead peer review process.
                                     Parties agree to develop affects
                                     matrices.
12/09/2002........................  Conference call with NMFS and FWS to
                                     discuss baseline issue relative to
                                     the presence of the dams. Parties
                                     eventually agree that dams are in
                                     the baseline.
12/19/2002........................  E-mail from FWS indicating that 8/
                                     2000 BA is inadequate for
                                     consultation purposes and indicates
                                     that consultation should be put on
                                     hold until it is revised.
12/31/2002........................  Phone call to FWS to discuss 12/19 e-
                                     mail. General agreement that
                                     consultation can proceed with a
                                     target date for completion of
                                     October 2003 and BR would provide
                                     additional information as requested
                                     and if available to further
                                     consultation process.
1/06/2003.........................  Meeting with FWS and NMFS. Agree to
                                     schedule to complete consultation
                                     in October 2003. Interim dates for
                                     peer review process included.
                                     Worked on affects matrix. Discussed
                                     dam/baseline issue again.
1/08/2003.........................  Met with ID's to bring them up to
                                     speed on meetings with NMFS and FWS
                                     since 11/2002.
1/22/2003.........................  Meeting with FWS and NMFS. Peer
                                     review process discussed. Meeting
                                     focused on affects matrix for two
                                     example reaches--Cle Elum Reservoir
                                     and Granger-Prosser.
1/30/2003.........................  Meeting with FWS, NMFS and ID's. FWS
                                     reports on peer review process
                                     being developed. More discussion
                                     about dams/baseline, FWS indicates
                                     the issue needs to be elevated and
                                     BR agrees. Work on matrix--outline
                                     data sources and analysis
                                     techniques for Cle Elum as an
                                     example for other reaches.
1/31/2003.........................  Phone call with FWS to discuss dams/
                                     baseline issue. Agreed issues
                                     needed to be elevated
2/13/2003.........................  Meeting with FWS, NMFS and ID's to
                                     discuss Yakima Project maintenance
                                     details. FWS reports on peer review
                                     process. Parties agree to have
                                     matrices available by March 3.
2/19/2003.........................  Phone call to FWS on dams/baseline
                                     issue. FWS indicated they did not
                                     believe now was the time to elevate
                                     issue but rather wait until draft
                                     BO was done.
2/20/2003.........................  BR memo to FWS in reply to 12/19/
                                     2002 email agreeing to time
                                     extension till end of October 2003
                                     to complete consultation
2/28/2003.........................  Meeting with FWS and NMFS to discuss
                                     consultation and peer review. FWS
                                     proposes very abbreviated peer
                                     review process which NMFS doesn't
                                     like and then entire process is
                                     dropped. Agree on interim dates to
                                     complete consultation--affects
                                     analysis by mid-May, BR review by 6/
                                     1, release draft BO by 7/15, take
                                     comments and re-release late
                                     September with final the end f
                                     October. Also agreed to develop
                                     joint briefing paper on dams/
                                     baseline issue.
3/7/2003..........................  Met with FWS to develop joint
                                     briefing paper on dams/baseline
                                     issue
3/19/2003.........................  Met with FWS to review joint
                                     briefing paper on dams/baseline
                                     issue. Discussed need to elevate
                                     issue quickly, FWS was to explore
                                     and get back to BR.
3/26/2003.........................  3/27/2003E-mail exchange with FWS
                                     concerning elevation of dams/
                                     baseline issue
4/10/2003.........................  Meeting with FWS to discuss dams/
                                     baseline issue. BR feels dams are
                                     in the baseline and FWS believes
                                     affects of the presence of the dams
                                     are an affect of the proposed
                                     action.
4/11/2003.........................  E-mail from FWS on dams/baseline
                                     issue and jeopardy analysis. FWS
                                     believes dams and their impacts
                                     could be part of the baseline,
                                     proposed action or both and for
                                     purposes of jeopardy analysis it
                                     make little difference.
4/23/2003.........................  BR transmits draft effects analysis
                                     to FWS and NMFS
5/2/2003..........................  Phone call to FWS to arrange meeting
                                     to discuss draft affects analysis
                                     and potential misunderstandings.
                                     FWS doesn't commit.
5/6/2003..........................  E-mail to FWS in response to 4/11 e-
                                     mail
5/7/2003..........................  Phone call to FWS to arrange meeting
                                     to discuss draft affects analysis
                                     and potential misunderstandings.
                                     FWS indicated they had an internal
                                     discussion schedule for 5/9 and
                                     would then get back about arranging
                                     a meeting.
5/14/2003.........................  Phone call to FWS to arrange meeting
                                     to discuss draft affects analysis
                                     and potential misunderstandings.
                                     FWS 5/9 discussion did not occur so
                                     meeting can't be scheduled.
6/18/2003.........................  E-mail from FWS concerning baseline
                                     issue. Frames issue as BR's
                                     reluctance to treat future affects
                                     of proposed action as effect of the
                                     action.
------------------------------------------------------------------------

                              APPENDIX A-5

Consultation Requires Education
    NOAA and the U.S. Fish and Wildlife Service should insure 
biologists conducting ESA consultations are fully qualified because of 
the high stakes involved for both the species of concern and local and 
regional economies.
    ESA consultations can result in significant, negative, destructive 
consequences on local and regional economies. After NMFS (now NOAA 
Fisheries) listed Pacific salmonids over most of the West Coast, NMFS 
was ill-equipped to handle the large volume of consultations required 
by the listings. NMFS hired additional staff to cope with the work 
load, but in our experience NMFS staff in the field consulting on ESA 
issues are often junior-level biologists with limited knowledge of the 
species and the factors affecting them.
    Consequently, the decisions of ESA administrative personnel are 
often contrary to good science and to common sense, and many entities 
and individuals required to consult before obtaining government permits 
hire biologists from consulting firms with generally high levels of 
expertise and experience to resolve the problems created by services 
personnel. Thus, ESA consultations frequently consist of novices from 
the services consulting with experts from the scientific arena, who 
must first educate the services novices before proceeding with the 
consultation process. Services biologists should be able to understand 
both technical and policy issues before they are responsible for 
complex and contentious ESA consultations, but often are not.

                              APPENDIX A-6

ESA Administrative rules are vague
    ESA rules are often vague, increasing the potential for litigation, 
and leaving too much discretion to the individual agency biologists 
involved directly in ESA consultations.
            (1) Hatchery fish not counted.
    The treatment of hatchery fish, and the decision from Judge Hogan 
(Alsea Valley Alliance vs. Evans, infra, p. 31) in September, 2001, is 
just one example of arbitrary and vague decisions made by The National 
Marine Fisheries Service (NOAA Fisheries). In the Alsea Valley Alliance 
case, Judge Hogan held that NMFS had arbitrarily decided that hatchery 
fish were not to be included in the status of a population or species 
under consideration for listing.
    Although hatchery fish from the same parental source as wild fish 
cannot be differentiated from those wild fish, and their progeny will 
revert to wild fish when spawned in the wild, NMFS decided that only 
the wild component of the population should be included in the 
numerical status of the population when deciding whether the 
``species'' was at risk, and in essence was subdivided the population 
into what NMFS thought was suitable and unsuitable members. The only 
difference between the hatchery and wild fish are the identifying marks 
applied in the hatchery. Genetically, physically, and reproductively 
they were the same fish.
            (2) Proposed Bull Trout critical habitat.
    Recently, USFWS proposed critical habitat rules for bull trout. A 
review of the proposed critical habitat rules revealed the following 
weaknesses:
    The designation of the appropriate ``environmental baseline'' 
conditions forms the basis for evaluating actions which may affect 
listed species, but the application of the concept is inconsistent 
between the action agencies (NOAA/USFWS).
    The USFWS may exclude areas from critical habitat designation if 
the benefits of excluding areas outweigh the benefits of inclusion. 
However, the proposal does not define benefits, or establish any 
verifiable criteria for including or excluding habitat.
    Critical habitat should, to comply with ESA, include only the 
specific areas within the geographic area occupied by the species at 
the time it is listed, and which contain the physical and biological 
features essential to conservation of the species. Critical habitat 
must be limited geographically to what is essential to conservation of 
the species although more extensive habitat may be required to maintain 
the species over the long term, critical habitat only includes the 
minimum amount of habitat needed to avoid short-term jeopardy or 
habitat in need of immediate intervention. These provisions of the ESA 
are violated by USFWS' proposed bull trout critical habitat. For 
example, USFWS proposes to include two (2) streams in the Yakima Basin, 
Taneum Creek and the Teanaway River, as critical habitat, even though 
these streams do not currently support bull trout. There has been no 
discussion with stakeholders (YBJB and others) about whether or not 
these streams should be included in critical habitat to avoid short-
term jeopardy. No economic impact analysis has been performed on this 
designation of critical habitat.
    Definitions of important biological concepts are often lacking when 
new rules are proposed under the ESA. For example, the term 
``population'' is an important biological concept. The ESA rules are, 
however, so vague that on one hand the entire Columbia River basin 
population of bull trout is considered a ``distinct population 
segment'' for the purposes of listing the fish, while designation of 
critical habitat and for a finding of one or two redds in a stream 
reach is considered a population for the purposes of recovery planning.

                               APPENDIX B

Administrive errors and ESA misinterpretation
    Serious and unnecessary negative impacts on Pacific Northwest 
economy and way-of-life have resulted from the misapplication of the 
Endangered Species Act (ESA). These impacts have occurred because of 
the policy of the National Marine Fisheries Service (NOAA, formerly 
National Marine Fisheries Services or NMFS) as the administering agency 
of the ESA for anadromous Pacific salmon.
    It is necessary to recall that the purpose of the Endangered 
Species Act (ESA) of 1973, including amendments through 1996, is ``to 
provide a means whereby the ecosystems upon which endangered species 
and threatened species depend may be conserved, to provide a program 
for the conservation of such endangered species and threatened 
species,'' [ESA, Sec 2(b)].
    It is also necessary to recall what the Statute means by the term 
species. The term ``includes any subspecies of fish or wildlife or 
plants, and any distinct population segment of any species or 
vertebrate fish or wildlife which interbreeds when mature'' [ESA, Sec 
3(16)]. Therefore, conservation is to include the species at risk and 
the ecosystems they depend on, and the term ``species'' refers not only 
to the traditional (taxonomic) species such as the condor, grizzly 
bear, or northern spotted owl, but also to any distinct population 
segment (DPS) of a species which interbreeds when mature.
    NOAA has redefined the ``purpose'' of the ESA, the unit at risk, 
and what constitutes members of the unit, all of which are contrary to 
the wording of the Act.
            (1) Purpose of the ESA expanded
    The first unauthorized NOAA decision under the Act was declaring 
that conserving the genetic diversity of the species was the major goal 
of the Act. It was stated by Waples (NOAA Tech. Memo. 194, 1991) that 
such a framework accomplished the major goal of the Act, which was `` 
to conserve the genetic diversity of species (taxonomic) and the 
ecosystems they inhabit''. The genetic characteristics that were 
uniquely associated with the population unit would have to contribute 
to the overall genetic diversity of the taxonomic species. Therefore, 
NOAA decided that, rather than limiting the ESA to conserving species, 
subspecies, or DPSs, NOAA's administration of the Act would be to 
preserve genetic diversity. Preserving the genetic diversity of a 
species, however, requires very different and much broader protections 
than what is required for conserving species at risk of extinction. 
NOAA's decision was flawed
    because it created a purpose for the ESA different from and 
substantially more burdensome than, the purpose stipulated by 
Congress--to conserve ecosystems and species at risk.
            (2) Unit at Risk
    A second, but related, unauthorized NOAA decision was to overlook 
the statutory definition of the unit at risk, i.e. ``species,'' 
``subspecies,'' and ``DPS,'' and to adopt the framework that stated a 
population or a group of populations would be considered distinct under 
the Act ``if it represents an Evolutionary Significant Unit (ESU) of 
the biological species'' (NOAA Tech. Memo. NOAA F/NWC-194NOAA, Waples 
1991).
    NOAA then concluded that to qualify as an ESU the population or 
group of populations must be (a) reproductively isolated from other 
conspecific population units, and (b) represent an important component 
in the evolutionary legacy of the species. NOAA concluded that 
isolation need not be absolute, but sufficient to allow evolutionary 
differences to accrue that would define the unit as genetically 
distinct. These were subjective criteria and open to the interpretation 
of the administering action agency.
    NOAA established a unit different than species, subspecies, or 
distinct population segments around which to administer the Act. An ESU 
is not a unit defined by Congress as deserving protection under the 
ESA, nor does it fit the definition of a DPS, for which it was meant to 
substitute.
    Congress intended that a DPS was an interbreeding unit, and that 
meaning was clearly stated by Congress in the wording of the Statute. 
But NOAA clearly states that ESUs are not limited to interbreeding 
units. In fact, Utter et al. (American Fisheries Symposium 17:149-
165,1985) confirms the point that ESUs are not to be considered 
panmictic (i.e. interbreeding), because NOAA there states the 
``definition of an ESU by no means implies a single panmictic unit''.
    The issue is that NOAA decided to substitute multiple, non-
interbreeding populations as a unit at risk, and therefore entitled to 
protection in place of the DPS defined by Congress as the interbreeding 
population unit. The substitution of ESU for DPS was a flawed NOAA 
decision because it created a different category with different 
criteria to classify population units than what was stipulated by 
Congress.
    NOAA's creation of ESUs as a category at risk combined with NOAA's 
purpose to preserve genetic diversity, allowed NOAA to include, for 
example, all Chinook salmon in NOAA's classification of ESUs. Several 
populations can be lumped together based on genetic similarity and 
listed within a single ESU, whether or not each population warrants 
such treatment. Every population of Chinook salmon from the US/Canada 
border to southern California is a member of an ESU and nearly a 
hundred separate populations have been included in the listings. These 
listings are contrary to congressional instructions, ``to use the 
ability to list sparingly and only when the biological evidence 
warranted such action'' (96th Congress, 1st Session, 1979 Senate Report 
151). NOAA did not use the ability to list ``sparingly''.
    Moreover, even listings were contrary to the instructions to list 
only when the biological evidence warranted such action. For example, 
hundreds of thousands of Chinook salmon were returning each year over 
that geographical area, and recently near record numbers in the 
Columbia River have returned over the last 3 years, yet several ESUs in 
the Columbia Basin are listed at risk of extinction.
    However, regardless of the demonstrated strength of Chinook salmon 
and steelhead trout returns to the Columbia over the last 4 years, 
water users are still subjected to restrictive regulations on the use 
of water and adjoining land, justified under the pretense that Chinook 
and steelhead trout are at risk. NMFS has adopted a ``no net loss'' 
policy that prevents any new water use out of the entire mainstem 
Columbia River. The incongruity of these policies is underscored by the 
fact that commercial and sport fisheries are still allowed to harvest 
the reputed endangered species, with well over 400,000 Chinook 
harvested annually off the coasts of Washington, Oregon, and 
California.
            (3) Subdividing the Unit at Risk--exclusion of hatchery 
                    fish.
    The third major flaw in NOAA's policy decisions was its subdivision 
of the unit at risk. The ESA is ``to provide the means whereby the 
ecosystems upon which endangered species and threatened species depend 
may be conserved'' [ESA 1973, Sec 2(b)]. Under such mission-oriented 
legislation all fish within the identified unit at risk should be 
included in the census that determines their status, and in any plan to 
protect them.
    NOAA, however, made another unauthorized decision which allowed 
NOAA to establish categories of the same fish and treat them 
differently. NOAA decided that hatchery fish were excluded from the 
numerical assessment of populations reviewed for listing, unless they 
were considered essential to the recovery of those populations. This 
unauthorized policy resulted in a U.S. District Court ruling against 
NOAA in Alsea Valley Alliance v. Evans.\1\
---------------------------------------------------------------------------
     \1\In the Alsea Valley Alliance v. Evans, 161 F. Supp. 1154 (D. 
Or. 2001), Judge Michael Hogan of the United States District Court for 
the District of Oregon ruled that NOAA was ``arbitrary and capricious'' 
in its decision to list the Oregon Coast Coho salmon distinct 
population segment (DPS) (or ``Evolutionarily Significant Unit'' (ESU)) 
under the ESA. According to Judge Hogan, NOAA cannot list naturally 
spawning fish separate and apart from hatchery fish in the same DPS (or 
ESU). ``The central problem with the NOAA listing decision of August 
10, 1998, is that it makes improper distinctions below that of a DPS, 
by excluding hatchery populations from listing protection even though 
they are determined to be part of the same DPS as natural Coho 
populations.'' 161 F. Supp at 1162.
---------------------------------------------------------------------------
    This third flaw, therefore, was subdividing the unit at risk. Myers 
et al. (NOAA Tech. Memo. NOAA-NWFSC-35, 1998) stated in the Chinook 
salmon status review that ``attention should focus on natural fish 
which are defined as the progeny of naturally spawning fish''. This was 
reiterated by Waples (NOAA Tech. Memo. NOAA F/NWC-194NOAA, 1991) in the 
discussion on what constituted a ``species,'' and also where it was 
indicated that NOAA will determine ``the role (if any) of artificial 
propagation in development of recovery plans for listed species''. The 
NOAA policy on artificial propagation under the ESA (Hard et al. NOAA 
Tech. Memo. NOAA-NWFSC-2, 1992), again reconfirmed that in the view of 
NOAA ``the primary objective of the ESA is the conservation of species 
in their natural ecosystems''.
    The wording in the ESA reads ``to provide the means whereby the 
ecosystems upon which endangered species and threatened species depend 
may be conserved'' [ESA 1973, Sec 2(b)]. The term ``conserved'' is 
defined in the language of the ESA to include propagation. In the case 
of salmon, propagation means hatchery production. The ESA does not 
state or imply that we should discriminate against hatchery fish when 
making biological assessments or recovery plans, but rather indicates 
that hatchery propagation is a legitimate technology to sustain the 
species under the ESA. Hatchery produced salmon came from wild 
populations and are part of the legacy of those wild fish. They 
represent the same discrete and distinguish-able elements of the wild 
population, as demonstrated in genetic analyses, including Myers et 
al., NOAA Tech. Memo. NOAA-NWFSC-35 (1998). The final irony is that the 
progeny of hatchery fish spawning naturally are considered ``wild'' 
fish by NOAA.
    The ESA does not provide for or allow NOAA to distinguish between 
life history forms of the same species by listing one and excluding the 
other. A prime example is the listing of steelhead trout, and the 
exclusion of rainbow trout from the listing. Rainbow trout and 
steelhead trout interchange life history forms, are indistinguish-able 
genetically, and represent an ``ecosystem'' that has existed for 
thousands of years, yet steelhead trout are listed in four separate 
ESUs and rainbow trout are excluded. Part of the problem is the limited 
biological perspective of the Services in making the listing decision, 
but the fact remains that if rainbow trout were included in the ESUs 
there would have been no possible justification to list steelhead trout 
because rainbow trout are numerous throughout the Columbia River Basin. 
The Yakima River has a renowned trophy rainbow trout fishery which are 
genetically indistinguishable from Yakima River steelhead trout, and in 
fact interbreed with Yakima River steelhead trout.
    The three problems identified, i.e. (1) preserving genetic 
diversity, (2) creation of the ESU classification, and (3) subdividing 
the unit at risk, have created unnecessary and costly administrative 
burdens on the public, the State, and the Federal Governments. NOAA 
Fisheries' arbitrary and erroneous policy decisions have no 
justification, are clearly inconsistent with the wording of the 
Statute, and should be considered a serious breach of confidence in 
NOAA's administration of the law.

                               APPENDIX C

Improper listing of species: Columbia River Salmon, Steelhead Trout and 
        Bull Trout are not threatened with extinction
    The National Marine Fisheries Service (NMFS) made the determination 
that the Upper Columbia River Spring Chinook, Lower Columbia River 
Chinook, and Upper Snake River Spring/Summer Chinook, Snake River Fall 
Chinook, Upper Columbia River Steelhead Trout, Lower Columbia River 
Steelhead Trout, and Snake River Basin Steelhead Trout were in danger 
of extinction or likely to become endangered in the foreseeable future, 
and listed them respectively under the Endangered Species Act (ESA).
    Similarly, bull trout in the Columbia River Basin have also been 
listed by United States Fish and Wildlife Service (USFWS), involving 
Lower, Mid-, and Upper Columbia and Snake River populations. Contrary 
to the impressions given by such listings, Chinook salmon, steelhead 
trout, and bull trout species are, however, not at risk of extinction 
in the Columbia Basin. This represents a serious incongruity between 
the rationale for having listed these species at risk and the actual 
status of Chinook, steelhead trout and bull trout in the Columbia River 
system.
    In essence, this incongruity is at the foundation of the problems 
associated with the ESA, and originates with the administration of the 
Statute emanating from the policies developed by NMFS and USFWS, and 
not from the Act itself.
    As described in Appendix B, the error in listings of Chinook and 
steelhead were from policy memoranda and represented major departures 
from the precepts of the ESA. Listing of bull trout followed similar 
errors of ESA interpretation.
    With regard to the Columbia River Basin, the status of wild salmon, 
steelhead trout and trout was very much influenced by Federal 
development programs in the west, with efforts concentrated largely 
around the extensive water resources of the Columbia. Of the 673,400 
square kilometers of Basin (Mullan et al. 1992), 191,660 square 
kilometers were made inaccessible to anadromous fish species with the 
construction of Grand Coulee Dam on the mainstem Columbia River (Fish 
and Hanavan 1948), and 189,070 square kilometers were blocked by Hells 
Canyon Dam on the Snake River, reducing access to only 40 percent of 
the original stream area available to anadromous salmonids (Netboy 
1980).
    Sixty-four percent (64 percent) of the remaining mainstem fish 
habitat on the Columbia and Snake Rivers has been changed from flowing 
stream to reservoir environ-ments (ODFW & WDFW 2000). Furthermore, 
extensive introductions of exotic fish species have been made by USFWS 
and State agencies. Bass, crappie, perch, walleye, shad, carp and brook 
trout were introduced in the Columbia River and in many cases exotic 
species out-number native fish.
    The point often ignored by, or unknown to, anyone attempting to 
expand production of wild salmonids in the Columbia River system is 
that the reductions of populations experienced by these species and the 
introductions of exotic fish were intentional changes which resulted 
from planned development of the river.
    Federal irrigation and hydroelectric projects greatly enhanced the 
economic base of agriculture in Idaho, Oregon, and Washington, and 
expanded urbanization in otherwise arid land east of the Cascade 
Mountains. The cost of economically developing the Pacific Northwest 
was loss of fish habitat and wild fish. Congress established, however, 
fish hatcheries as the surrogate for wild Chinook and steelhead trout 
in the Columbia River Basin, and maintained anadromous fish runs 
through such measures. Congress assured sustained salmon and steelhead 
trout production in the Grand Coulee Maintenance Project, the Magnuson-
Stevens Act, the Mitchell Act, and other compensation programs, as 
Federal law and they have successfully achieved that objective. 
Consequently, hatchery fish have been contributing to, and are thus 
part of, naturally spawning wild populations for over 90 years in the 
Basin.
    Therefore, the suggestion that Chinook salmon and steelhead trout 
are at risk in the Columbia is not supported by the data (Brannon 2000, 
Brannon et al, 2002). As shown in Table 1, Chinook salmon adult returns 
passing Bonneville Dam have averaged over 600,000 fish in the last 4 
years, three times the average returns when these fish were listed in 
the early 90's. Similarly, in the last 3 years, steelhead trout have 
increased well over twice their previous average return, with both 
steelhead trout and Chinook demonstrating returns greater than 
experienced since before the 1930's, and wild fish are well represented 
among returning populations.
    In a like manner, bull trout are well represented throughout the 
Columbia River Basin, although they are reported in low numbers. They 
are present in all of the twenty-five separate regions identified in 
the Columbia system, which demon-strates that bull trout, as a species, 
are not at risk of extinction. The fact remains that until recently 
bull trout were given no attention and very little is known about their 
historical numbers in any of these regions. As a ``predator species'' 
that routinely undergoes extensive distribution throughout the system, 
bull trout's evolutionary strategy would be to avoid concentrating in 
large numbers, especially where food resources are limited as is often 
the case in the upper, more mountainous reaches of the watersheds. The 
bull trout's recently discovered wide ranging distribution within the 
Columbia River Basin indicates that bull trout are effectively self-
sustaining, and their relatively low population density is not a matter 
of a threat of extinction, but rather the consequence of life history 
evolution which offers favorable survival opportunities in the type of 
habitat bull trout seek.
    In each case where salmon, steelhead trout, or bull trout have been 
listed, the listing decision has been largely the result of limited 
knowledge about the biology of the species, as well as the tendency for 
NMFS and USFWS biologists to adopt general conservation measures rather 
than limiting themselves to the objective of the ESA.
    Chinook salmon, steelhead trout, and bull trout are not at risk of 
extinction so the general conservation programs for these species are 
the responsibility of State agencies, not the ESA or the services.
    Table 1. Adult wild and hatchery Chinook and steelhead trout 
passage at Bonneville Dam on the Columbia River over the last three 4 
year spawning cycles (total Chinook includes jacks, total steelhead is 
wild plus hatchery).

                                            Chinook, Steelhead Trout
----------------------------------------------------------------------------------------------------------------
                        Year                           Spring    Summer     Fall      Total     Wild      Total
----------------------------------------------------------------------------------------------------------------
2002................................................   268,813   127,436   474,554   925,452   143,045   481,203
2001................................................   391,347    76,156   400,410   971,331   149,582   633,464
2000................................................   178,302    30,616   192,815   491,928    76,220   275,273
1999................................................    38,669    26,169   242,143   343,276    55,064   206,448
1998................................................    38,342    21,433   189,085   280,944    35,701   185,094
1997................................................   114,000    27.939   218,734   387,088    33,580   258,385
1996................................................    51,493    16,034   205,358   296,635    17,375   205,213
1995................................................    10,192    15,030   164,197   240,050        --   202,448
1994................................................    20,169    17,631   170,397   243,450    39,174   161,978
1993................................................    10,820    22,045   126,472   277,657        --   188,386
1992................................................    88,425    15,063   116,200   256,299        --   314,973
1991................................................    57,346    18,897   150,190   274,644        --   274,535
----------------------------------------------------------------------------------------------------------------

References
Brannon, E., M. Powell, A. Talbot, and T, Quinn. 2002. Columbia River 
    Chinook salmon and steelhead population structure. BPA Report. 
    Project Number 98-004-03.
Brannon, E. L. 2000. Assessment of the ESA Listing of Columbia River 
    Anadromous Salmonids with Emphasis on Chinook Salmon. Center for 
    Salmonids and Freshwater Species at Risk, Aquaculture Research 
    Institute, University of Idaho, Moscow, Idaho 83843.
Fish, F.F., and M.G. Hanavan. 1948. A report on the Grand Coulee Fish 
    Maintenance Project.
Mullan, J.W., K.R. Williams, G. Rhodus, T.W. Hillman, and J.D. 
    McIntyre. 1992. Production and habitat of salmonids in mid-Columbia 
    River tributary streams. Monograph I, U.S. Fish and Wildlife 
    Service, Box 549, Leavenworth, WA 98826.
Meyers, J.M., R.G. Kope, G.J. Bryant, D. Teel, L.J. Lierheimer, T.C. 
    Wainwright, W. S. Grant, F.W. Waknitz, K. Neely, S.T. Lindley, and 
    R.S. Waples. 1998. Status review of Chinook salmon from Washington, 
    Idaho, Oregon, and California. NOAA Technician Memorandum NMFS-
    NWFSC-35. U.S. Dept. of Comm/NOAA/NMFS/NWFSC. 443 pp.
Pacific Fishery Management Council. 2000. Ocean salmon fisheries off 
    Washington, Oregon and California. Report to National Oceanic and 
    Atmospheric Administration. NA07FC00026.

                              APPENDIX D A

 The United States has no legal authority to change the use or 
        reallocate Yakima Reclamation Project surface irrigation water 
        which is owned by Yakima Reclamation Project landowner/
        waterusers; the U.S. is a ``trustee'' for the benefit of 
        Project irrigator landowner/ waterusers
    The 1902 Reclamation Act, Section 8 (43 USC 383) provides:
            "Sec.  383. Vested rights and State laws unaffected
    "Nothing in this Act shall be construed as affecting or intended to 
affect or to in any way interfere with the laws of any State or 
Territory relating to the control, appropriation, use, or distribution 
of water used in irrigation, or any vested right acquired thereunder, 
and the Secretary of the Interior, in carrying out the provisions of 
this Act, shall proceed in conformity with such laws, and nothing 
herein shall in any way affect any right of any State or of the Federal 
Government or of any landowner, appropriator, or user of water in, to 
or from any interstate stream or the waters thereof. (June 17, 1902, 
ch. 1093, Sec.  8 in part, 32 Stat. 390.)'' (Emphasis added)

    The Yakima Reclamation Project water rights are, pursuant to 43 USC 
383 above-quoted, as well as unambiguous Federal and Washington State 
water law, the vested property of the YBJB landowner/waterusers whose 
predecessors-in-interest appropriated, beneficially used Yakima 
Reclamation Project water on their land and perfected their Yakima 
Reclamation Project water rights [See, Lawrence vs. Southard, 192 Wash. 
287, 73 P.2d 722 (1937).]
    The U.S. Supreme Court in Ickes vs. Fox, 300 U.S. 82, 95-96 (1937), 
which involved YBJB landowner/waterusers in the Sunnyside Division of 
the Yakima Reclamation Project, analyzed the 1902 Reclamation Act, 
Federal and Washington State water law, the Yakima Reclamation 
Project's surface water rights including ownership of them, the U.S.'s 
perpetual water delivery contracts with, and obligations to, YBJB 
landowner/waterusers, and unambiguously held:

    `` . . . . Appropriation was made not for the use of the 
government, but, under the Reclamation Act, for the use of landowners; 
and by the terms of the law and of the contract already referred to, 
the water rights became property of the landowners, wholly distinct 
from the property right of the government in the irrigation works. 
Compare Murphy vs. Kerr, 296 Fed. 536, 544, 545. The government was and 
remained simply a carrier and distributor of the water (Id.), with the 
right to receive the sums stipulated in the contracts as reimbursement 
for the cost of construction and annual charges for operation and 
maintenance of the works. As security therefore, it was provided that 
the government should have a lien upon the lands and the water rights 
appurtenant thereto--a provision which in itself imports that the water 
rights belong to another than the lienor, that is to say, to the 
landowner.

    `` . . . . And in those States, generally, including the State of 
Washington, it has long been established law that the right to the use 
of water can be acquired only by prior appropriation for a beneficial 
use; and that such right when thus obtained is a property right, which, 
when acquired for irrigation, becomes, by State law and hereby express 
provision of the Reclamation Act as well, part and parcel of the land 
upon which it is applied.'' (Emphasis added)
    The United States has no legal authority, discretion, or surface 
water right approved or certificated by Washington State to 
consumptively or non-consumptively ``re-allocate'' or use YBJB 
landowner/waterusers' Yakima Reclamation Project surface irrigation 
water for any purpose other than for the irrigation of YBJB landowner/
waterusers' land except for the substantially diminished treat fishery 
water right affirmed by the Washington State Supreme Court in DOE vs. 
Yakima Reservation Irrigation District, et al., 121 Wn.2d 257, 850 P.2d 
1306 (1993).
    The U.S. is, in addition, obligated by its ``perpetual'' contracts 
executed with YBJB members for the benefit of YBJB landowner/waterusers 
and also, as their trustee, to annually store and deliver the entire 
Yakima Reclamation Project's total water supply available (``TWSA'') as 
defined in KRD, et al. vs. SVID, et al., U.S. District Court (E.D. 
Wash. 1945) (less the substantially diminished treaty fishery water) 
for each landowner/wateruser's annual use and reuse as irrigation water 
to the full extent of each YBJB landowner/wateruser's Yakima 
Reclamation Project water and water right entitlement.
    The U.S. Supreme Court in Nevada vs. United States, 463 U.S. 110,m 
122-123, 127-128, 103 S.Ct. 2906, 77 L.Ed.2d 509 (1983), quoting from 
43 USC 383, California vs. U.S., 438 U.S. 645, 664 (1978), Fox vs. 
Ickes, supra, and Nebraska vs. Wyoming, 325 U.S. 589, 613-614 (1945), 
unambiguously concluded and held:

    ``In California vs. United States, 438 U.S. 645 (1978), we 
described in greater detail the history and structure of the 
Reclamation Act of 1902, and stated:

    ``The projects would be built on Federal land and the actual 
construction and operation of the projects would be in the hands of the 
Secretary of the Interior. But the Act clearly provided that State 
water law would control in the appropriation and later distribution of 
the water.'' Id. at 664 (emphasis added).

    ``In the light of these cases, we conclude that the Government is 
completely mistaken if it believes that the water rights confirmed to 
it by the Orr Ditch decree in 1944 for use in irrigating lands within 
the Newlands Reclamation Project were like so many bushels of wheat, to 
be bartered, sold or shifted about as the Government might see fit. 
Once these lands were acquired by settlers in the Project, the 
Government's 'ownership' of the water rights was at most nominal; the 
beneficial interest in the rights confirmed to the Government resided 
in the owners of the land within the Project to which these water 
rights became appurtenant upon the application of Project water to the 
land. As in Ickes vs. Fox and Nebraska vs. Wyoming, the law of the 
relevant State and the contracts entered into by the landowners and the 
United States make this point very clear. (Footnote omitted)

    ``The Government's brief is replete with references to a fiduciary 
obligation to the Pyramid Lake Paiute Tribe of Indians, as it properly 
should be. But the Govern-ment seems to wholly ignore in the same brief 
the obligations that necessarily devolve upon it from having mere title 
to water rights for the Newlands Project, when the beneficial ownership 
of these water rights resides elsewhere.'' (Emphasis added)

    YBJB member entities, also acting as ``trustees'' for the benefit 
of their landowner/ waterusers, have executed ``perpetual'' contracts 
with the United States, obligating the U.S. to annually deliver to YBJB 
member entities their landowner/ waterusers' full, annual Yakima 
Reclamation Project irrigation water and water right entitlements.
    Four (4) of the YBJB member entities (Kittitas, Roza, Sunnyside and 
Yakima-Tieton) landowner/waterusers' annual irrigation water and water 
right entitlements were unconditionally confirmed in the 1/31/45 
``Judgment'' in KRD, et al. vs. SVID, et al., U.S. District Court (E.D. 
Wash. 1945).

                                 
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