[Federal Register Volume 63, Number 35 (Monday, February 23, 1998)]
[Rules and Regulations]
[Pages 8859-8873]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 98-4367]


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DEPARTMENT OF THE INTERIOR

Fish and Wildlife Service

50 CFR Part 17

DEPARTMENT OF COMMERCE

National Oceanic and Atmospheric Administration
National Marine Fisheries Service

50 CFR Part 222

[Docket No. 980212035-8035-01]
RIN 1018-AE24


Habitat Conservation Plan Assurances (``No Surprises'') Rule

AGENCY: Fish and Wildlife Service, Interior; National Marine Fisheries 
Service, NOAA, Commerce.

ACTION: Final rule.

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DATES: This rule is effective March 25, 1998.

SUMMARY: This final rule codifies the Habitat Conservation Plan 
assurances provided through section 10(a)(1)(B) permits issued under 
the Endangered Species Act (ESA) of 1973, as amended. Such assurances 
were first provided through the ``No Surprises'' policy issued in 1994 
by the Fish and Wildlife Service (FWS) and the National Marine 
Fisheries Service (NMFS), (jointly referred to as the ``Services,'') 
and included in the joint FWS and NMFS Endangered Species Habitat 
Conservation Planning Handbook issued on December 2, 1996 (61 FR 
63854). The No Surprises policy announced in 1994 provides regulatory 
assurances to the holder of a Habitat Conservation Plan (HCP) 
incidental take permit issued under section 10(a) of the ESA that no 
additional land use restrictions or financial compensation will be 
required of the permit holder with respect to species covered by the 
permit, even if unforeseen circumstances arise after the permit is 
issued indicating that additional mitigation is needed for a given 
species covered by a permit. The Services issued a proposed rule on May 
29, 1997 (62 FR 29091) and the comments received on that proposal have 
been evaluated and considered in the development of this final rule. 
This final rule contains revisions to parts 17 (FWS) and 222 (NMFS) of 
Title 50 of the Code of Federal Regulations necessary to implement the 
Habitat Conservation Plan assurances.

ADDRESSES: To obtain copies of the final rule or for further 
information, contact Chief, Division of Endangered Species, U.S. Fish 
and Wildlife Service, Washington, D.C., 20240; or Chief, Endangered 
Species Division, National Marine Fisheries Service, Office of 
Protected Resources, 1315 East-West Highway, Silver Spring, MD, 20910.

FOR FURTHER INFORMATION CONTACT: E. LaVerne Smith, Chief, Division of 
Endangered Species, U.S. Fish and Wildlife Service, (Telephone 703/358-
2171, or Facsimile 703/358-1735), or Nancy Chu, Chief, Endangered 
Species Division, National Marine Fisheries Service (Telephone (301/
713-1401, or 301/713-0376).

SUPPLEMENTARY INFORMATION: These final regulations and the background 
information regarding the final rule apply to both Services. The 
proposed rule has been revised based on the comments received. The 
final rule is presented in two parts because the Services have separate 
regulations for implementing the section 10 permit process. The first 
part is for the final changes in the FWS's regulations found at 50 CFR 
17.22 and 17.32, and the second part is for the final changes in NMFS's 
regulations found at 50 CFR 222.22.

Background

    Section 9 of the ESA generally prohibits the ``take'' of species 
listed under the ESA as endangered. Pursuant to the broad grant of 
regulatory authority over threatened species in section 4(d) of the 
ESA, the Services' regulations generally prohibit take of species 
listed as threatened. See, e.g., 50 CFR 17.31 and 17.21 (FWS). Section 
3(18) of the ESA defines ``take'' to mean ``to harass, harm, pursue, 
hunt, shoot, wound, kill, trap, capture, or collect, or to attempt to 
engage in any such conduct.'' FWS regulations (50 CFR 17.3) define 
``harm'' to include ``significant habitat modification or degradation 
where it actually kills or injures wildlife by significantly impairing 
essential behavioral patterns, including breeding, feeding or 
sheltering.''
    Section 10 of the ESA, as originally enacted in 1973, contained 
provisions allowing the issuance of permits authorizing the taking of 
listed species under very limited circumstances for non-Federal 
entities. In the following years, both the Federal government and non-
Federal landowners became concerned that these permitting provisions 
were not sufficiently flexible to address situations in which a 
property owner's otherwise lawful activities might result in limited 
incidental take of a listed species, even if the landowner were willing 
to plan activities carefully to be consistent with the conservation of 
the species. As a result, Congress included in the ESA Amendments of 
1982 provisions under section 10(a) to allow the Services to issue 
permits authorizing the incidental take of listed species in the course 
of otherwise lawful activities, provided that those activities were 
conducted according to an approved conservation plan (habitat 
conservation plan or HCP) and the issuance of the HCP permit would not 
jeopardize the continued existence of the species. In doing so, 
Congress indicated it was acting to ``* * * address the concerns of 
private landowners who are faced with having otherwise lawful actions 
not requiring Federal permits prevented by section 9 prohibitions 
against taking * * * `` H.R. Rep. No. 835, 97th Cong., 2d Sess. 29 
(1982) (hereafter ``Conf. Report'').
    Congress modeled the 1982 section 10 amendments after the 
conservation plan developed by private landowners and local governments 
to protect the habitat of two listed butterflies on San Bruno Mountain 
in San Mateo County, California while allowing development activities 
to proceed. Congress recognized in enacting the section 10 HCP 
amendments that:

    `` * * * significant development projects often take many years 
to complete and permit applicants may need long-term permits. In 
this situation, and in order to provide sufficient incentives for 
the private sector to

[[Page 8860]]

participate in the development of such long-term conservation plans, 
plans which may involve the expenditure of hundreds of thousands if 
not millions of dollars, adequate assurances must be made to the 
financial and development communities that a section 10(a) permit 
can be made available for the life of the project. Thus, the 
Secretary should have the discretion to issue section 10(a) permits 
that run for periods significantly longer than are commonly provided 
[for other types of permits].'' (Conf. Report at 31).

    Congress also recognized that long-term HCP permits would present 
unique issues that would have to be addressed if the permits were to 
function to protect the interests of both the species involved and the 
non-Federal community. For instance, Congress realized that ``* * * 
circumstances and information may change over time and that the 
original [habitat conservation] plan might need to be revised. To 
address this situation, the Committee expects that any plan approved 
for a long-term permit will contain a procedure by which the parties 
will deal with unforeseen circumstances.'' (Conf. Report at 31). 
Congress also recognized that non-Federal property owners seeking HCP 
permits would need to have economic and regulatory certainty regarding 
the overall cost of species mitigation over the life of the permit. As 
stated in the Conference Report on the 1982 ESA amendments:

    ``The Committee intends that the Secretary may utilize this 
provision to approve conservation plans which provide long-term 
commitments regarding the conservation of listed as well as unlisted 
species and long-term assurances to the proponent of the 
conservation plan that the terms of the plan will be adhered to and 
that further mitigation requirements will only be imposed in 
accordance with the terms of the plan. In the event that an unlisted 
species addressed in the approved conservation plan is subsequently 
listed pursuant to the Act, no further mitigation requirements 
should be imposed if the conservation plan addressed the 
conservation of the species and its habitat as if the species were 
listed pursuant to the Act.'' (Conf. Report at 30 and 50 FR 39681-
39691, Sept. 30. 1985).

    Congress thus envisioned and allowed the Federal government to 
provide regulatory assurances to non-Federal property owners through 
the section 10 incidental take permit process. Congress recognized that 
conservation plans could provide early protection for many unlisted 
species and, ideally, prevent subsequent declines and, in some cases, 
the need to list covered species.
    The Services decided that a clearer policy regarding the assurances 
provided to landowners entering into an HCP was needed. This need 
prompted the development of the No Surprises policy, which was based on 
the 1982 Congressional Report language and a decade of working with 
private landowners during the development and implementation of HCPs. 
The Services believed that non-Federal property owners should be 
provided economic and regulatory certainty regarding the overall cost 
of species conservation and mitigation, provided that the affected 
species were adequately covered by a properly functioning HCP, and the 
permittee was properly implementing the HCP and complying with the 
terms and conditions of the HCP permit in good faith. A driving concern 
during the development of the policy was the absence of adequate 
incentives for non-Federal landowners to factor endangered species 
conservation into their day-to-day land management activities.
    The Services issued the ESA No Surprises policy in August of 1994. 
This policy was then included in the joint Endangered Species Habitat 
Conservation Planning Handbook, which was published in draft form for 
public review and comment on December 21, 1994 (59 FR 65782), and, 
after consideration of the comments, was issued as final in December 
1996 (61 FR 63854). In addition to that opportunity for public comment 
on the No Surprises policy in general, the application of the policy 
and its assurances have been and continue to be subject to an 
opportunity for public comment on each proposed HCP permit under 
section 10(c) of the ESA on a case-by-case basis. The Services were 
subsequently sued in Spirit of the Sage Council v. Babbitt, No. 
1:96CV02503 (SS) (D. D.C.), which challenged the procedures under which 
the No Surprises policy was adopted and under which subsequent HCP 
permits were issued. In settling this lawsuit, the Services agreed to 
submit the No Surprises Policy to further public comment and to 
consider public comment in deciding whether to adopt the No Surprises 
policy as a final regulation. The Services agreed to this approach 
because they recognized the benefits of permanently codifying the No 
Surprises policy as a rule in 50 CFR, as well as the value of 
soliciting additional comments on the policy itself.

Summary of the Proposed Rule

    The proposed rule stated that the Services, when negotiating 
unforeseen circumstances provisions for HCPs, would not require the 
commitment of additional land, property interests, or financial 
compensation beyond the level of mitigation that was otherwise 
adequately provided for a species under the terms of a properly 
functioning conservation plan. Moreover, the Services would not seek 
any other form of additional mitigation from a permittee except under 
unforeseen circumstances. However, if additional mitigation measures 
were subsequently deemed necessary to provide for the conservation of a 
species that was otherwise adequately covered under the terms of a 
properly functioning conservation plan, the obligation for such 
measures would not rest with the permittee.
    Under the proposed rule, if unforeseen circumstances warrant 
additional mitigation from a permittee who is in compliance with the 
conservation plan's obligations, such mitigation would, to the maximum 
extent possible, be consistent with the original terms of the 
conservation plan. Further, any such changes will be limited to 
modifications within conserved habitat areas, if any, or to the 
conservation plan's operating conservation program for the affected 
species. Additional mitigation requirements would not involve the 
payment of additional compensation or apply to parcels of land or the 
natural resources available for development under the original terms of 
the conservation plan without the consent of the permittee.
    Criteria were also developed by the Services that must be used for 
determining whether and when unforeseen circumstances arise.
    Under the proposed rule, the Services also would not seek any form 
of additional mitigation for a species from a permittee where the terms 
of a properly functioning conservation plan were designed to provide an 
overall net benefit for that species and contained measurable criteria 
for the biological success of the conservation plans which have been or 
are being met. Nothing in the proposed rule would limit or constrain 
the Services, or any other governmental agency, from taking additional 
actions at its own expense to protect or conserve a species included in 
a conservation plan.
    The Services also proposed a permit-shield provision in the 
proposed rule that stated that compliance with the terms of an 
incidental take permit constitutes compliance with the requirements of 
sections 9 and 10 of the ESA with respect to the species covered by the 
permit regardless of changes in circumstances, policy, and regulation, 
unless a change in statute or court order specifically requires that 
assurances given in the original permit be modified or withdrawn.

[[Page 8861]]

    The Services also clarified in the proposed rule that the 
regulatory and economic assurances provided to HCP permittees are 
limited to section 10(a)(1)(B) permits. In addition, the assurances are 
not provided to Federal agencies.

Summary of Comments Received

    The Services received more than 800 comments on the proposed rule 
from a large variety of entities, including Federal, State, County, and 
Tribal agencies, industry, conservation groups, religious groups, 
coalitions, and private individuals. The Services considered all of the 
information and recommendations received from all interested parties on 
the proposed regulation during the public comment period and 
appreciated the comments received on the proposed rule. In addition to 
comments that specifically addressed the proposed No Surprises policy 
in the proposed rule, the Services received numerous additional 
comments on the HCP process itself, comments which were beyond the 
narrow scope of this particular rulemaking on the No Surprises policy. 
The Services will utilize these more generic comments on HCPs, as 
appropriate, as we continue to improve the implementation of our HCP 
programs. However, at this time, the Services will only address 
comments received that are specific to the proposed No Surprises rule.
    The Services have made changes in the proposed rule where 
appropriate. In addition, the Services intend to revise the HCP 
Handbook, both to reflect the final No Surprises rule and to further 
enhance the effectiveness of the HCP process in general through 
expanded use of adaptive management, monitoring provisions, and the 
establishment of overall biological goals for HCPs.
    The following is a summary of the comments on the proposed 
regulations, and the Services' response.
    Issue 1: Many commenters believed that to provide regulatory No 
Surprises assurances, the Secretary was directed to ``* * * consider 
the extent to which the conservation plan is likely to enhance the 
habitat of the listed species or increase the long-term survivability 
of the species or its ecosystem * * *'' (Conf. Report at 31.) and that 
the Services have no legislative authority to provide regulatory 
assurances for HCPs that do not meet this standard.
    Response 1: A proposed HCP must satisfy the specific issuance 
criteria enumerated in section 10(a)(2)(B) of the ESA. In deciding 
whether these criteria have been satisfied and whether the permit 
should be issued for a given species, the Services consider, among 
other things, the extent to which the habitat of the affected species 
or its long-term survivability may be improved or enhanced. While it 
may be appropriate to consider an ``enhancement factor'' for an HCP, it 
is not a mandatory section 10(a)(2)(B) issuance criterion for all 
species.
    Each HCP is analyzed on a case-by-case basis, using the best 
scientific information available. Habitat conditions are part of the 
data the Services evaluate to determine whether a proposed HCP meets 
the section 10 issuance criteria. The legislative history of the 1982 
amendments to section 10 of the ESA indicates that Congress viewed 
habitat improvement and species conservation as appropriate 
considerations in determining whether to issue long-term incidental 
take permits. Certain types of HCPs, such as forest HCPs that include 
aquatic species, often allow for significant timber harvest and 
consequent species impacts during the initial years, while it may take 
decades before the riparian measures under the plan produce stream 
conditions that provide essential habitat functions for the listed 
species. The Services agree that, in appropriate situations, the 
legislative history supports including measures to provide for improved 
habitat over the life of the plan in section 10 permits. Severely 
depleted species and species for which the HCP covers all or a 
significant portion of the range are examples of circumstances in which 
essential habitat functions must be addressed to ensure that the 
conservation measures in the HCP provide a high probability that the 
habitat functions essential to the species' long-term survival will be 
achieved and maintained during the term of the permit.
    Issue 2: Many commenters felt that this proposed regulation was 
driven solely by the needs of private landowners, and is not in the 
best interests of the species or other public concerns. Many commenters 
noted that the proposed regulation did not have commensurate 
certainties for protection of biological resources.
    Response 2: The section 10(a) HCP provisions of the ESA were 
designed to help alleviate section 9 ``take'' liability for species on 
non-Federal lands. The ESA, as originally enacted, allowed the taking 
of listed species only under very limited circumstances, and did not, 
for example, allow the incidental take of listed species in the course 
of otherwise lawful activities. The 1982 ESA amendments to section 
10(a) authorize the Services to issue HCP permits allowing the 
incidental take of listed species in the course of otherwise lawful 
activities, provided the activities are conducted according to an 
approved habitat conservation plan that minimize and mitigate take and 
avoids jeopardy to the continued existence of the affected species.
    The Services disagree that the No Surprises policy has a narrow 
focus that excludes the consideration of listed species conservation. 
To the contrary, a driving concern in the development of the policy was 
the absence of adequate incentives for non-Federal landowners to factor 
endangered species conservation into their day-to-day land management 
activities. The Services knew that much of the habitat of listed 
species is in non-Federal lands and believed that HCPs should play a 
major role in protecting this habitat. Yet, while thousands of acres of 
species habitat were disappearing each year, only a handful of HCPs had 
been sought and approved since 1982. The No Surprises policy was 
designed to rechannel this uncontrolled ongoing habitat loss through 
the regulatory structure of section 10(a)(1)(B) by offering regulatory 
certainty to non-Federal landowners in exchange for a long-term 
commitment to species conservation. Given the significant increase in 
landowner interest in HCPs since the development of the No Surprises 
policy, the Services believe that the policy has accomplished one of 
its primary objectives--to act as a catalyst for integrating endangered 
species conservation into day-to-day management operations on non-
Federal lands. The Services also believe that the HCP process, which is 
a mechanism that reconciles economic development and the conservation 
of listed species, is good for rare and declining species, and 
encourages the development of more of these plans. If species are to 
survive and recover, such plans are necessary because more than half of 
the species listed have 80 percent of their habitat on non-Federal 
lands.
    Issue 3: Many commenters stressed that the proposed regulation 
would unlawfully allow the Services to avoid their mandatory duties 
under section 7 of the ESA. They argued that the proposed regulation 
precludes the Services from meeting the regulatory and statutory 
requirements under 50 CFR 402.16 and section 7(d) because it makes 
reinitiation of consultation useless and precludes any meaningful 
reexamination of mitigation measures if the measures in the HCP are 
later found to be inadequate to avoid jeopardy as required under 
section 7(a)(2). If jeopardy did arise, commenters do not

[[Page 8862]]

feel that the Services would be able to implement the necessary 
mitigation to avoid the jeopardy because of lack of funding. Other 
concerns were also raised by commenters regarding the respective 
balance of responsibilities among the participants to an HCP containing 
a No Surprises assurance. Also, some commenters suggested the Services 
would not be fulfilling their mandatory conservation obligations under 
section 7(a)(1).
    Response 3: The Services are committed to meeting their 
responsibilities under section 7(a)(2) of the ESA. As required by law, 
the Services conduct a formal intra-Service section 7 consultation 
regarding the issuance of each permit issued under section 10(a)(1)(B). 
The purpose of any consultation is to insure that any action 
authorized, funded, or carried out by the Federal government, including 
the issuance of an HCP permit, is not likely to jeopardize the 
continued existence of any listed species or result in the destruction 
or adverse modification of critical habitat of such species. In 
addition, the Services encourage all applicants to maximize benefits to 
species covered by their HCPs because of the Services' responsibilities 
under 7(a)(1). Moreover, as discussed in Response #1, in appropriate 
situations, such as when an HCP covers most or the entire range of a 
species or covers severely depleted species, the Services will seek 
measures necessary for the long-term survival of the species and its 
habitat.
    The Services do not believe they are disregarding the requirements 
of section 7(d) in providing assurances to landowners through the 
section 10 process. During the formal section 7(a)(2) consultation 
process, and prior to the issuance of a final biological opinion, the 
Services (like any other Federal action agency) must not make any 
irreversible or irretrievable commitments of resources (in the case of 
proposing to issue an HCP permit, the Services cannot authorize 
incidental take) that would preclude the development of reasonable and 
prudent alternatives in the event that the action, as proposed, 
violates section 7(a)(2) of the ESA. In the context of HCP permit 
procedures, the only manner in which the Services could violate section 
7(d) is if they authorized incidental take prior to making a final 
decision on a permit application, which is never the case.
    In addition, the No Surprises assurances do not make reinitiation 
of consultation useless or preclude any meaningful reexamination of the 
HCP's operating conservation program. The Services will not require the 
landowner to provide additional mitigation measures in the form of 
additional land, water, or money. However, additional mitigation 
measures can be provided by another entity. Similarly, the No Surprises 
rule does not preclude the Services from shifting emphasis within an 
HCP's operating conservation program from one strategy to another in an 
effort to enhance an HCP's overall effectiveness, provided that such a 
shift does not increase the HCP permittee's costs. For example, if an 
HCP's operating conservation program originally included a mixture of 
predator depredation control and captive breeding, but subsequent 
research or information demonstrated that one of these was considerably 
more effective than the other, the Services would be able to request an 
adjustment in the proportionate use of these tools, provided that such 
an adjustment did not increase the overall costs to the HCP permittee.
    Moreover, if the Services reinitiate consultation on the permitting 
action, and if additional measures are needed, the Services will work 
together with other Federal, State, and local agencies, Tribal 
governments, conservation groups, and private entities to ensure 
additional measures are implemented to conserve the species.
    Regarding the concerns on the respective balance of 
responsibilities among the participants to an HCP containing a No 
Surprises assurance, the Services believe the No Surprises rule places 
the preponderance of the responsibility for protection beyond the terms 
of a specific HCP upon the Services. The only impediments to the 
Services' assumption of this additional responsibility will arise from 
limits on authority or funding to provide this additional protection.
    The Services have significant resources and authorities that can be 
utilized to provide additional protection for threatened or endangered 
species that are the subject of a given HCP including land acquisition 
or exchange, habitat restoration or enhancement, translocation, and 
other management techniques. For example, lands managed by the 
Department of the Interior could be used to ensure listed species 
protection. Moreover, subsequent section 7 consultations and approval 
of subsequent section 10 permits will have to take into account the HCP 
and the status of the species at that time. The section 9 prohibition 
against unauthorized take by other landowners provides additional 
protection.
    In addition, section 5 of the ESA authorizes the Services to 
acquire lands to conserve endangered and threatened fish, wildlife, and 
plants, and section 6 of the ESA authorizes the Services to cooperate 
with the States in conserving listed species. While many of these 
programs and authorities are subject to the availability of 
appropriations, others, such as the authority under the Federal Land 
Policy and Management Act to exchange land for conservation purposes, 
do not require appropriations. These authorities provide additional 
flexibility through which the Services could meet their section 7 
responsibilities. While by no means exhaustive, the above discussion 
demonstrates the depth of authorities and resources available to the 
Services to meet their No Surprises commitments.
    Utilizing these authorities and resources, the Services should be 
able to provide additional species protection that may be required in 
the unexpected event that an HCP falls short of providing sufficient 
protection.
    Issue 4: Many commenters stated that the proposed regulation 
violates section 4(b)(8) of the ESA, which requires ``* * * the 
publication in the Federal Register of any proposed or final regulation 
which is necessary or appropriate to carry out the purposes of this ESA 
shall include a summary by the Secretary of the data on which such 
regulation is based and shall show the relationship of such data to 
such regulation * * *''.
    Response 4: The Services believe section 4(b)(8) is intended to 
apply only to listing and critical habitat decisions under section 4. 
However, even if section 4(b)(8) did apply to this rule, the Services 
have complied with its requirements. The proposed rule contained a 
thorough discussion of the basis for the proposed rule (62 FR 29091, 
May 29, 1997). In addition, the Services had previously explained the 
background of the No Surprises Policy in the draft HCP Handbook, which 
was published for public comment in the Federal Register (59 FR 65782, 
December 21, 1994).
    Issue 5: Many commenters believe that the Secretary of the Interior 
does not have the authority to issue assurances for species covered by 
the Migratory Bird Treaty Act (MBTA) and the Bald and Golden Eagle 
Protection Act (BGEPA).
    Response 5: The FWS believes that the ESA is more restrictive and 
protective of species than the MBTA and the BGEPA, and that species 
covered under an HCP that are also covered by the MBTA and the BGEPA 
will adequately be protected as long as the HCP is properly 
implemented. The FWS has concluded that under certain

[[Page 8863]]

conditions, a section 10 permit allowing incidental take of listed 
migratory birds is sufficient to relieve the permittee from liability 
under the MBTA and BGEPA for taking those species. For the MBTA, this 
is accomplished by having the HCP permit double as a Special Purpose 
Permit authorized under 50 CFR 21.27. For the BGEPA, the FWS would 
exercise its prosecutorial discretion not to prosecute an incidental 
take permittee under the BGEPA if such take is in compliance with a 
section 10 permit under the ESA.
    However, there are conditions that must be satisfied before either 
of these protections apply, which are explained on pages 3-40 to 3-41 
in the joint Endangered Species Habitat Conservation Planning Handbook 
(61 FR 63854, December 2, 1996). The FWS believes this approach is 
warranted because the permittee already would have agreed to an 
operating conservation program designed to conserve the species and 
minimize and mitigate the impacts of take of the listed species of 
migratory birds to the maximum extent practicable. Through the 
permitting provisions of the MBTA and the FWS's discretion in the 
enforcement of the BGEPA and the ESA, the FWS has the authority to 
provide a permittee with assurance that they will not be prosecuted 
under the MBTA or BGEPA for take expressly allowed under the ESA.
    Issue 6: Many commenters stated that HCPs with No Surprises 
assurances are in conflict with the issuance criteria in the ESA 
because, in the event of unforeseen circumstances, the project impacts 
may not be fully mitigated and the plan may reduce the survival and 
recovery of a covered species.
    Response 6: The assurances provided through this regulation are 
consistent with the issuance criteria of the ESA. Before issuing a 
permit, the Services ensure that the applicant minimizes and mitigates 
the project impacts, to the maximum extent practicable, and that the 
permitted activities avoid jeopardy to the continued existence of the 
affected species.
    In addition, in cases where significant data gaps exist, adaptive 
management provisions are included in the HCP. The primary reason for 
using adaptive management in HCPs is to allow for up-front, mutually 
agreed upon changes in the operating conservation program that may be 
necessary in light of subsequently developed biological information. In 
the event of unforeseen circumstances, these strategies may be 
redirected as long as the redirection is consistent with the scope of 
the mutually agreed-upon adaptive management provisions of the HCP.
    Issue 7: Many commenters stated that the applicant is legally 
required to address all unforeseen circumstances in the HCP pursuant to 
section 10. They noted that fire, disease, drought, flood, global 
climate change, and non-point source pollution may be unforeseen, but 
are not uncommon. Also the proposed regulation does not direct the 
applicant to provide for all unforeseen circumstances that might occur 
during the length of the permit because it is the Services' 
responsibility to determine that there was an unforeseen circumstance 
that was not addressed and is not the fault of the permittee 
implementing the HCP. In addition, commenters noted that the nature of 
many of the HCPs that the Services are approving increases the 
likelihood for unforeseen events to happen (i.e., the permits are 
issued for many years and cover large areas and many species).
    Response 7: The Services disagree that HCPs must address all 
hypothetical future events, no matter how remote the probability that 
they may occur. Rather, the Services believe that only reasonably 
foreseeable changes in circumstances need to be addressed in an HCP. 
Moreover, these circumstances are likely to vary from HCP to HCP given 
the ever changing mix of species and affected habitats covered by a 
given plan. Nevertheless, the Services agree that the proposed rule's 
treatment of unforeseen circumstances could be strengthened, and a 
definition of unforeseen circumstances has been codified in this rule. 
In particular, the Services would like to clarify that unforeseen 
circumstances will only include events that could not reasonably have 
been anticipated. All reasonably foreseeable circumstances, including 
natural catastrophes that normally occur in the area, should be 
addressed in the HCP. The final rule specifies how unforeseen 
circumstances will be addressed if they occur during the life of the 
permit.
    Issue 8: Commenters believe that the proposed regulation would not 
allow for social changes that could occur over the lifetime of the 
permit. For example, they claim that the development and implementation 
of the Emergency Salvage Timber rider has affected the success of the 
conservation measures of several HCPs.
    Response 8: There may be situations that do arise related to social 
changes that could occur during the lifetime of the permit. In these 
situations, the Services will use all of their legal authorities to 
adequately address the changes. The Timber Salvage rider to the 
Appropriations bill is actually a good example of how the 
Administration responded to a change in social policy. On July 27, 
1995, the President signed the Rescission Act (Public Law 104-19) that 
provided funds for disaster relief and other programs. This bill 
contained provisions for an emergency salvage timber sale, and directed 
the preparation, offer, and award of timber salvage sales nationwide. 
Although the bill passed, the President did not support the provision 
that waived compliance with environmental laws during timber salvage 
and directed the Secretaries of Agriculture, the Interior and Commerce, 
and the heads of other agencies, to move forward to implement the 
timber-related provisions of the bill in an expeditious and 
environmentally-sound manner. The Services worked with other Federal 
agencies to develop a process that, as a matter of Administration 
policy, addressed compliance with all environmental laws while also 
meeting the requirements of Pub. L. 104-19. An interagency team of 
Federal agencies then drafted a process that addressed compliance with 
the ESA through a streamlined section 7 consultation procedure to 
ensure that these sales did not jeopardize listed species. In this 
case, the Services and other Federal agencies cooperatively used their 
administrative discretion and legal authorities to ameliorate adverse 
impacts upon listed species conservation.
    Issue 9: Several commenters believe that the proposed No Surprises 
rule negates adaptive management provisions incorporated into HCPs, and 
may not allow future jeopardy situations to be addressed, because 
adaptive management must allow for adaptions to changes as they occur 
rather than trying to plan for everything up front. In addition, many 
commenters believe that in order to get No Surprises assurances, an HCP 
must have an adaptive management program that addresses all foreseeable 
biological and environmental changes and that is designed so that new 
applicable scientific information and information developed through a 
monitoring program is incorporated into the plan.
    Response 9: The Services do not believe that the proposed rule 
negates adaptive management provisions incorporated into HCPs for the 
species with biological data gaps. The No Surprises assurances only 
apply to an approved HCP that has otherwise satisfied the issuance 
criteria under section 10(a)(2)(B) of the ESA. When considering permits 
where there are significant biological data gaps, the

[[Page 8864]]

Services have two choices: either deny an HCP permit application due to 
the inadequacy of the overall proposed plan, or build in adaptive 
management and monitoring provisions where warranted because of 
biological data gaps and issue the permit. If there is significant 
uncertainty associated with the operating conservation program, 
adaptive management becomes an integral component of the HCP. 
Incorporating adaptive management provisions into the HCP becomes 
important to the planning process and the long-term interest of 
affected species when HCPs cover species with significant biological 
data gaps. Through adaptive management, the biological objectives of an 
operating conservation program are defined using techniques such as 
models of the ecological system that includes its components, 
interactions, and natural fluctuations. If existing data makes it 
difficult to predict exactly what conservation and mitigation measures 
are needed to achieve a biological objective, then an adaptive 
management approach should be used in the HCP. Under adaptive 
management, the HCP's operating conservation program can be monitored 
and analyzed to determine if it is producing the desired results (e.g., 
properly functioning riparian habitats). If the desired results are not 
being achieved, then adjustments in the program can be considered 
through an adaptive management clause of the HCP. Thus, adaptive 
management can be an integral part of the operating conservation 
program for an HCP and can be implemented to adjust strategies 
accordingly. The Services support continuing to strengthen the 
effectiveness of adaptive management provisions in HCPs and intend to 
do so in further revisions to the HCP Handbook.
    Issue 10: Numerous commenters stated that the proposed regulation 
should identify secured sources of funding that do not rely on 
appropriations for the implementation of conservation measures that may 
be needed to address unforeseen circumstances.
    Response 10: Funding mechanisms of this type would have to be 
established through Congressional action. Absent Congressional action 
on this matter, the Services must operate with the fiscal resources 
otherwise made available to them through the appropriations process. 
Moreover, in approving an HCP in the first instance, the Services must 
conclude that the permittee has provided for adequate funding to 
implement the terms of the HCP.
    Issue 11: Many commenters stated that the Federal government is not 
capable of shouldering the financial burden of funding the 
implementation of conservation measures that may be needed to address 
unforeseen circumstances. The hardship of paying for any changes needed 
in the HCP on the government may have severe and far reaching effects 
on funding for other Federal activities. In addition, some commenters 
noted that the proposed regulation unlawfully shifts the burden of 
funding to the Services when section 10 clearly states that the 
applicant will provide the funding. Numerous commenters stated that the 
government does not have guaranteed funding for covering unforeseen 
circumstances and cannot make such guarantees in violation of the Anti-
Deficiency Act.
    Response 11: The ESA requires the Service to find that an 
incidental take permittee has provided adequate funding to implement an 
HCP in the first instance. In addition, the Services must ensure that 
HCPs are designed to adequately mitigate the incidental take authorized 
by the permit, include measures to deal with unforeseen circumstances 
that may arise, and comply with such other measures that the Secretary 
may require as being necessary or appropriate for purposes of the plan. 
Once the Services have concluded that a permittee has initially 
satisfied the issuance criteria in section 10(a), there is nothing in 
the ESA that precludes the Services from assuming additional 
responsibility for species covered under the terms of an HCP, 
especially when such responsibilities are limited to highly unlikely 
unforeseen circumstances. In fact, the Services have responsibility for 
listed species conservation regardless of whether an HCP is involved or 
not, and carrying out that responsibility (for example, through the 
initiation of litigation to enforce section 9 of the ESA) is also 
dependent upon the availability of appropriated funds. Therefore, at a 
conceptual level, the lack of guaranteed funding to handle a breakdown 
of an HCP due to unforeseen circumstances is no different from a lack 
of guaranteed funding to enforce the ESA generally.
    The Anti-Deficiency Act applies to the Services' activities under 
the ESA as it does to their activities under all other environmental 
laws. In the face of an unexpected species decline, where additional 
conservation efforts are warranted, the Services have significant 
resources at their disposal to address the comparative needs of the 
species. As noted earlier in Response #3, the Services can also work 
with Congress, other Federal, State, and local agencies, tribes, 
environmental groups, and private entities to help ensure the continued 
conservation of the species in the wild. The Services have a variety of 
tools available to ensure that the needs of the species affected by 
unforeseen circumstances are adequately addressed, including land 
acquisition or exchange, habitat restoration or enhancement, 
translocation, and other management techniques. Thus, the Services 
believe they have a wide array of options and resources available to 
respond to any unforseen circumstances.
    Issue 12: Many commenters noted that many HCPs do not have adequate 
funding, and the Services must not issue an incidental take permit 
unless an applicant has secured adequate funding to address all 
foreseeable changes that might be needed in the conservation measures 
during the lifetime of the permit. County or State Bonds that are not 
guaranteed should not be considered ``adequate funding.''
    Response 12: Section 10(a)(2)(B)(iii) requires incidental take 
permit applicants to ``ensure that adequate funding for the plan will 
be provided.'' This issuance criterion requires that the applicant 
detail the funding that will be available to implement the proposed 
operating conservation program. Therefore, all conservation plans 
specify funding requirements necessary to implement the plan. The 
Services issue a permit only when they have concluded that the 
operating conservation program will be adequately funded. No Surprises 
only applies to an HCP that is being properly implemented, and if a 
major component of an HCP, like its funding strategy, is never 
initiated or implemented, then No Surprises no longer applies and the 
assurances lapse.
    The FWS has incorporated provisions into HCPs that allow for a 
reevaluation of species coverage in case a County or State Bond that is 
supposed to meet the adequate funding issuance criterion ultimately is 
not passed. Under these provisions, the list of species authorized for 
incidental take may be diminished if funding is not in place within a 
specified time frame, and any incidental take that would occur before 
the bond measure is acted upon would have to be adequately mitigated 
up-front. This reevaluation mechanism was used in the Multiple Species 
Conservation Program for southwestern San Diego County, California. 
This type of reevaluation process will be incorporated into other HCPs 
that rely on proposed bonds to provide required funding.

[[Page 8865]]

    Issue 13: Many commenters stated that funding and accountability 
mechanisms are more complicated for permits that involve third party 
beneficiaries (e.g., certificates of inclusion), and that these types 
of permits should not include assurances.
    Response 13: The Services believe that the assurances provided by 
the final rule should be available to individuals who participate in 
HCPs through a larger regional planning process. These large-scale, 
regional HCPs can significantly reduce the burden of the ESA on small 
landowners by providing efficient mechanisms for compliance, 
distributing the economic and logistical impacts of endangered species 
conservation among the community, and bringing a broad range of 
landowner activities under the HCPs' legal protection. In addition, 
these large-scale HCPs allow for ecosystem planning, which can provide 
benefits to more species than small-scale HCPs. Large-scale HCPs also 
provide the Services with a better opportunity for analyzing the 
cumulative effects of the projects, which is more efficient than the 
piecemeal approach that could result if each landowner developed his/
her own HCP. The Services do believe, however, that the party that 
holds the ``overarching'' permit, and issues subpermits (e.g., 
Certificates of Inclusion or Participation Certificates) must have the 
legal authority to enforce the terms and conditions of the permit and 
the underlying funding mechanisms for the HCP.
    Issue 14: Many commenters requested the Services to remove the 
permit-shield provision from the proposed regulation because it 
improperly restricts the authority of the Secretary and citizens to 
enforce the requirements of the ESA. These commenters assert that the 
Services do not have the authority to prevent citizens from suing those 
who are in violation of the ESA. One commenter stated that the permit-
shield provision lacks important limitations found in other permit-
shield provisions, such as the Clean Water Act and Resource 
Conservation and Recovery Act. Commenters also stated that the proposed 
permit-shield provision conflicts with the citizen suit provision in 
section 11(g) of the ESA. Other commenters supported the proposed 
permit-shield provision and urged the Service to incorporate it into 
the final rule. These commenters believe failure to include a permit-
shield provision would undercut the No Surprises assurances by exposing 
permit holders to potential enforcement actions even if they are 
complying fully with the terms and conditions of valid permits.
    Response 14: After further review of the permit-shield concept, 
including a review of legal authorities, the Services have decided not 
to include a legally binding permit-shield provision in the final rule. 
The purpose of the permit-shield provision was to provide certainty to 
permittees regarding their legal obligations. The current statutory and 
regulatory framework appears to already provide permittees with that 
certainty. Although commenters stated that a permit holder might still 
be vulnerable to government-initiated enforcement actions 
notwithstanding the No Surprises assurances, the Services cannot 
identify situations in which a permittee would be in violation of 
Sections 9 or 11 of the ESA, if in fact they were acting within the 
permit's authorization and were complying with the terms and conditions 
of the permit.
    In addition, as part of the review of legal authorities, the 
Services reviewed the court decision in Shell Oil Company v. 
Environmental Protection Agency, 950 F.2d 741, 761-765 (D.C. Cir. 
1991), which addressed the legality of the Environmental Protection 
Agency's permit-shield rule for permits issued under the Resource 
Conservation and Recovery Act (RCRA). Although that decision upheld the 
RCRA permit-shield rule promulgated by the EPA, 40 CFR 270.4(a), the 
Services are concerned that the incidental take permit program is 
sufficiently different from the RCRA permit program that the Shell Oil 
decision may not support a permit-shield rule for incidental take 
permits. For instance, the court noted that the maximum term of RCRA 
permits is 10 years, which is considerably shorter than the terms of 
most incidental take permits. In addition, the EPA retains explicit 
authority to modify or terminate RCRA permits in response to 
information arising after a permit is issued that would have justified 
different permit terms had it existed when the permit was issued. In 
contrast, the No Surprises rule commits the Service to issue permits 
that do not require additional land, water, or financial compensation 
or additional restrictions on the use of land, water, or other natural 
resources if unforeseen circumstances arise.
    Although the Services have decided not to include a legally binding 
permit-shield provision in the final rule, they nonetheless strongly 
support a policy that permittees should feel free of potential 
prosecution if they are acting under the authorizations of their permit 
and are complying with the terms and conditions of the permit. The 
Services therefore will continue their policy of not enforcing the 
prohibitions of Section 9 of the ESA against any incidental take 
permittee who complies fully with the terms and conditions of the 
permit.
    Many commenters requested that the Services remove the permit-
shield provision from the proposed regulation because it improperly 
restricts the authority of citizens to enforce the requirements of the 
ESA. The purpose of the proposed permit-shield provision was to provide 
that the Services would not utilize Section 11(e) of the ESA to enforce 
Section 9 prohibitions against a permittee who is in full compliance 
with the terms and conditions of a permit. The permit-shield provision 
would not, therefore, have restricted citizen suits.
    Issue 15: Commenters believe that the regulatory assurances 
provided to the permittee deprive citizens of the right to have general 
oversight of HCPs, including challenging government's management 
decisions, guaranteeing that landowners are in compliance with the 
agreements, and ensuring that the plans are actually working to 
conserve listed species.
    Response 15: The No Surprises assurances do not deprive citizens of 
HCP oversight or of their ability to challenge an improperly issued HCP 
permit. In addition, all Service decision documents (such as approval 
of HCP management plans) are part of the Administrative Record for any 
individual HCP and are available to any member of the public upon 
request. Nothing in this rule prevents citizens from challenging the 
adequacy of those decisions or bringing HCP permit terms and conditions 
compliance issues to the Services' attention. The Services welcome 
citizen input on HCP implementation. Public comments must be considered 
in all permit decisions. Providing No Surprises assurances to an HCP 
permittee does not eliminate this public comment period. In addition, 
the Services or any party designated as responsible by the Services 
(e.g., State wildlife agency, local government) in the HCP will be 
expected to monitor the project for compliance with the terms of the 
incidental take permit and HCP. The Services also require periodic 
reporting from the permittee in order to maintain oversight to ensure 
the implementation of the HCP's terms and conditions. The final rule 
does nothing to affect these reporting requirements.
    Issue 16: Numerous commenters stated that the proposed regulation 
should provide for permits to contain a reopener clause. Any entity 
(e.g., landowners, government agencies, ecologists, environmentalists) 
would then be able to reopen the permit for any of the following 
reasons: 1) Any

[[Page 8866]]

party fails to implement the terms and conditions of the permit; (2) 
new listings of any species not covered; and (3) monitoring indicates 
that conservation goals are not being met and that the operating 
conservation program is ineffective.
    Response 16: The HCP process already provides various mechanisms 
for reopening an HCP. First, the Services may suspend, or in certain 
circumstances, revoke all or part of the privileges authorized by a 
permit if the permittee does not comply with the terms and conditions 
of the permit or with applicable laws and regulations governing the 
permitted activity. If an HCP permit is suspended or revoked, 
incidental take must cease. The provisions of most HCPs expressly 
address permit suspension or revocation procedures. Second, if a 
species was not initially listed on an HCP permit, it may not be 
automatically covered by an HCP when subsequently listed. For example, 
if a species was not originally listed on a permit, the HCP must be 
formally amended. Amendment of a section 10(a)(1)(B) permit is also 
required when the permittee wishes to significantly modify the project, 
activity, or conservation program as described in the original HCP. 
Such modifications might include significant boundary revisions, 
alterations in funding or schedule, or an addition of a species to the 
permit that was not addressed in the original HCP. The Services 
encourage the public to provide them with applicable information 
concerning any approved HCP that would be useful in evaluating the 
effectiveness of the HCP or other concerns they may have.
    Issue 17: Numerous commenters stated that the assurances provided 
through these proposed regulations should not be automatic and should 
be commensurate with risk, and that the Services should provide 
assurances to a permittee only if the HCP includes specific objectives 
or measurable biological goals that must be met and that would ensure 
the conservation of the species, if they are attained.
    Response 17: The Services believe that the commitments of an HCP 
must be specifically identified and scientifically based, reflecting 
the particular needs of the species that are covered. Thus, the concept 
of comparative risk to various species is factored in by the Services 
as they assess the adequacy of the operating conservation program for a 
given HCP. The Services will not approve an HCP permit request found to 
be inadequate, but will provide No Surprises assurances to all HCPs 
that are found to be adequate.
    For many recent HCPs, the Services are defining specific biological 
goals. Furthermore, comprehensive monitoring programs provide added 
value for measuring progress toward meeting the goals and commitments 
and ensuring that the permittee is in compliance with the permit. The 
Services often incorporate monitoring measures to assess whether goals 
are being met, especially in cases where additional information may be 
desirable or there is significant scientific uncertainty. If existing 
data makes it difficult to predict exactly what measures are needed to 
achieve a biological objective, then an adaptive management strategy is 
usually required. Adaptive management, which then becomes an integral 
component of the operating conservation program, is not negated by the 
No Surprises assurances because it was a part of the HCP's operating 
conservation program as approved by the Services.
    Issue 18: Most commenters stated that to get assurances, a 
multispecies HCP must adequately cover each individual species rather 
than collectively cover a group of species defined by some type of 
commonality (e.g., guild or habitat).
    Response 18: The Services believe that each species in a 
multispecies HCP must be adequately addressed by satisfying the permit 
issuance criteria under section 10(a)(2)(B) of the ESA. The Services 
believe, nevertheless, that in some cases, using a ``guilding'' or 
habitat-based approach to craft preserve designs or management measures 
may be appropriate.
    However, even when such tools are used, the Services will ensure 
that for each species that receives assurances, the species must be 
specifically named in the HCP, and adequate conservation measures are 
included in the plan.
    Issue 19: Commenters believe that to get assurances, an HCP must 
have an adequate and comprehensive biological monitoring program that 
addresses all foreseeable changes in circumstances that may occur over 
the lifetime of the permit.
    Response 19: Monitoring is already an element of HCPs under the 
Services' Federal regulations [50 CFR 17.22(b)(1), 17.32(b)(1), and 
222.22]. Monitoring is also an important tool for HCPs, and their 
associated permit and Implementing Agreements, and should be properly 
designed and implemented. The scope of the monitoring program should be 
sufficient to address reasonably foreseeable changes in circumstances 
that occur during the life of the permit. Monitoring is needed to 
obtain the information necessary to properly assess the impacts from 
the HCP and to ensure that HCPs are properly implemented. Monitoring 
will also allow the use of the scientific data obtained on the effects 
of the plan's operating conservation program to modify specific 
strategies through adaptive management, and to enhance future 
strategies for the conservation of species and their habitat.
    While the Services appreciate the numerous benefits of a well-
developed monitoring program, some low-effect HCPs have minimal 
monitoring requirements because the impacts from the plan are minor or 
negligible, and the attempt by the commenters to make an extensive 
monitoring program a requirement for No Surprises assurances is 
misplaced. A well-developed monitoring program will add to the 
credibility of an HCP proposal and will facilitate the eventual 
approval of the HCP. Thus, the Services believe that the real test for 
receiving the No Surprises assurances should be whether the issuance 
criteria under section 10(a) have been satisfied, and not whether a 
particular conservation tool, such as monitoring, has been extensively 
employed under an HCP whether it is needed or not.
    Issue 20: Numerous commenters stated that to get assurances for 
unlisted species, a plan must be in place that describes what is 
necessary for their long-term conservation. Commenters encouraged a 
standard for unlisted species equal to that used in the proposed policy 
and regulations for the Candidate Conservation Agreements (CCAs).
    Response 20: While the Services agree that these two types of 
agreements are similar, the purposes of the proposed CCA policy and the 
No Surprises rule are somewhat different. As stated in the proposed CCA 
policy, the ultimate goal of these agreements is to encourage 
landowners and State and local land managing agencies to manage their 
lands in a manner that, if adopted on a broad enough scale by similarly 
situated landowners, would remove threats to species and thereby 
obviate the need to list them under the ESA. The purposes of including 
unlisted species in HCPs and of making them subject to No Surprises 
assurances, are to enlist landowners in efforts to conserve these 
species and to provide certainty to landowners who are willing to make 
long-term commitments to the conservation of listed and unlisted 
species that they will not be subjected to additional conservation and 
mitigation measures if one of the species is listed, except as provided 
in their HCPs. The standards for including an unlisted species under an 
HCP are the

[[Page 8867]]

issuance criteria under section 10(a)(2)(B) of the ESA. For HCPs, the 
Services will continue to use the conservation standard identified in 
the Habitat Conservation Planning Handbook for unlisted species. The 
Handbook clearly states that an unlisted species is ``adequately 
covered'' in an HCP only if it is treated as if it were listed pursuant 
to section 4 of the ESA, and if the HCP meets the permit issuance 
criteria in section 10(a)(2)(B) of the ESA with respect to the species. 
The No Surprises assurances apply only to species (listed and unlisted) 
that are adequately covered in the HCP. Species, whether listed or 
nonlisted, will not be included in the HCP permit if data gaps or 
insufficient information make it impossible to craft conservation and 
mitigation measures for them, unless these data gaps can be overcome 
through the inclusion of adaptive management clauses in the HCP.
    Issue 21: Many commenters requested an addition to the rule that 
would address the early termination of an HCP. Commenters want the 
Services to discuss the possibility of terminating an HCP, including 
how the assurances and applicable mitigation apply to the termination.
    Response 21: The Services believe that such a requested change is 
unnecessary. The No Surprises assurances apply during the life of the 
permit, provided that the HCP is properly implemented and the terms and 
conditions of the HCP incidental take permit are being followed. Should 
a permit be terminated early, the No Surprises assurances also 
terminate as of the same date. The question of how outstanding 
mitigation responsibilities should be handled upon early termination is 
a more generic HCP policy issue that is unrelated to the No Surprises 
assurances and is, therefore, beyond the scope of this particular 
rulemaking.
    Issue 22: Several commenters stated that the proposed rule was 
confusing regarding the different level of assurances established in 
the proposed rule (for regular HCPs and for HCPs that provide a ``net 
benefit'' to the covered species) and that the distinction between the 
two levels should be clarified further or only one level of assurances 
should be provided to HCP permittees.
    Response 22: The Services agree that these distinctions were 
unnecessarily confusing and have revised the final rule accordingly. 
The final rule requires the Services to provide only one level of 
assurances to any permittee that has an approved HCP permit. The 
Services eliminated the level of assurances for HCPs that were 
developed to provide a net benefit for the covered species since the 
distinction between the two types of HCPs were very difficult to 
delineate in practice.
    Issue 23: Commenters noted that there were differences between the 
regulations, such as FWS use of the term ``unforeseen'' circumstances 
throughout the proposed rule, whereas NMFS used the terms 
``unforeseen'' and ``extraordinary'' circumstances in their proposed 
rule.
    Response 23: The Services agree that there was some confusion and 
have made the regulations consistent between the two agencies, where 
possible. Moreover, there was never an intention in the August 1994 No 
Surprises announcement to create a substantive difference between 
``unforeseen'' and ``extraordinary'' circumstances. NMFS will use the 
term ``unforeseen'' in its regulations in place of ``extraordinary.''

Revisions to the Proposed Rule

    The following represents a summary of the revisions to the proposed 
rule as a result of the consideration of the public comments received 
during this rulemaking process. The Services have rewritten the 
``Assurances'' section of the preamble and regulatory language to 
improve clarity and readability. Many commenters were confused by the 
language in the proposed rule, and asked the Services to provide a 
clearer explanation of this section. Accordingly, the Services have 
edited and reorganized the Assurances provision, but have not made any 
substantive changes.
    (1) Some of the definitions used in this rulemaking process will 
now be codified as definitions in 50 CFR 17.3 for FWS and 50 CFR 222.3 
for NMFS. These definitions were concepts identified in the 
``Background'' section of the proposed rule.
    (2) The rule was revised so the Services will only provide 
assurances for species listed on a permit that are adequately covered 
in the conservation plan and specifically identified on the permit.
    (3) The Services have clarified that the duration of the assurances 
is the same as the length of the permit.
    (4) The Services revised the rule so that there is only one level 
of assurances provided to permittees, instead of one level of 
assurances for standard HCPs and another level for HCPs that were 
developed to provide a ``net benefit'' for the covered species.
    (5) The Services have clarified the rule so that it is apparent 
that No Surprises assurances do not apply to Federal agencies who have 
a continuing obligation to contribute to the conservation of threatened 
and endangered species under section 7(a)(1) of the ESA.
    (6) The Services believe that HCPs are, and will continue to be, 
carefully crafted so that unforeseen circumstances will be rare, if at 
all, and that the Services will be able to successfully handle any 
unforeseen circumstance so that species are not jeopardized. To help 
ensure that unforeseen circumstances are a rare occurrence, the Service 
revised the rule in appropriate areas.
    (7) The Services replaced the term ``properly functioning,'' which 
was used in the proposed rule to ``properly implemented.'' This change 
accurately reflects the intent of the Services when discussing the 
implementation of HCPs.
    (8) The Services eliminated the permit-shield provisions from the 
final rule.
    (9) The Services revised the final rule by replacing the term 
``property interests'' with the term ``natural resources,'' which more 
accurately describes the intent of the Services.

Description/Overview of the Final Habitat Conservation Plan Assurances 
(``No Surprises'' Policy) Rule

    The information presented below briefly describes the ``No 
Surprises'' assurances adopted in this final rule. These assurances 
provide economic and regulatory certainty for non-Federal property 
owners that participate in the ESA's section 10(a)(1)(B) permitting 
process through the following:
    1. General assurances. The No Surprises assurances apply only to 
incidental take permits issued in accordance with the requirements of 
the Services' regulations where the conservation plan is being properly 
implemented, and apply only to species adequately covered by the 
conservation plan.
    Discussion: Once an HCP permit has been issued and its terms and 
conditions are being fully complied with, the permittee may remain 
secure regarding the agreed upon cost of conservation and mitigation. 
If the status of a species addressed under an HCP unexpectedly worsens 
because of unforeseen circumstances, the primary obligation for 
implementing additional conservation measures would be the 
responsibility of the Federal government, other government agencies, or 
other non-Federal landowners who have not yet developed an HCP.
    ``Adequately covered'' under an HCP for listed species refers to 
any species addressed in an HCP that has satisfied the permit issuance 
criteria under section 10(a)(2)(B) of the ESA. For

[[Page 8868]]

unlisted species, the term refers to any species that is addressed in 
an HCP as if it were listed pursuant to section 4 of the ESA and is 
adequately covered by HCP conditions that would satisfy permit issuance 
criteria under section 10(a)(2)(B) of the ESA if the species were 
actually listed. For a species to be covered under a HCP it must be 
listed on the section 10(a)(1)(B) permit. These assurances apply only 
to species that are ``adequately covered'' in the HCP.
    ``Properly implemented conservation plan'' means any HCP, 
Implementing Agreement, and permit whose commitments and provisions 
have been and are being fully implemented by the permittee and in which 
the permittee is in full compliance with the terms and conditions of 
the permit, so the HCP is consistent with the agreed-upon operating 
conservation program for the project.
    2. Changed circumstances provided for in the plan. If additional 
conservation and mitigation measures are deemed necessary to respond to 
changes in circumstances that were provided for in the plan's operating 
conservation program, the permittee will be expected to implement the 
measures specified in the plan.
    3. Changed circumstances not provided for in the plan. If 
additional conservation and mitigation measures are deemed necessary to 
respond to changed circumstances that were not provided for in the 
plan's operating conservation program, the Services will not require 
any conservation and mitigation measures in addition to those provided 
for in the plan without the consent of the permittee, provided the plan 
is being properly implemented.
    Discussion: It is important to distinguish between ``changed'' and 
``unforeseen'' circumstances. Many changes in circumstances during the 
course of an HCP can reasonably be anticipated and planned for in the 
conservation plan (e.g., the listing of new species, or a fire or other 
natural catastrophic event in areas prone to such events), and the 
plans should describe the modifications in the project or activity that 
will be implemented if these circumstances arise. ``Unforeseen 
circumstances'' are changes in circumstances affecting a species or 
geographic area covered by an HCP that could not reasonably have been 
anticipated by plan developers or the Services at the time of the HCP's 
negotiation and development, and that result in a substantial and 
adverse change in the status of a covered species (e.g., the eruption 
of Mount St. Helens was not reasonably foreseeable).
    4. Unforeseen circumstances. In negotiating unforeseen 
circumstances, the Services will not require without the consent of the 
permittee, the commitment of additional land, water or financial 
compensation or additional restrictions on the use of land, water, 
including quantity and timing of delivery, or other natural resources 
beyond the level otherwise agreed upon for the species covered by the 
conservation plan.
    If additional conservation and mitigation measures are deemed 
necessary to respond to unforeseen circumstances, the Services may 
require additional measures of the permittee where the conservation 
plan is being properly implemented, but only if such measures are 
limited to modifications within conserved habitat areas, if any, or to 
the conservation plan's operating conservation program for the affected 
species, and maintain the original terms of the conservation plan to 
the maximum extent possible. Additional conservation and mitigation 
measures will not involve the commitment of additional land, water or 
financial compensation or restrictions on the use of land, water 
(including quantity and timing of delivery), or other natural resources 
otherwise available for development or use under the original terms of 
the conservation plan, without the consent of the permittee.
    In determining unforeseen circumstances, the Services will have the 
burden of demonstrating that such unforeseen circumstances exist, using 
the best scientific and commercial data available. These findings must 
be clearly documented and based upon reliable technical information 
regarding the status and habitat requirements of the affected species. 
The Services will consider, but not be limited to, the following 
factors: size of the current range of the affected species; percentage 
of range adversely affected by the conservation plan; percentage of 
range conserved by the conservation plan; ecological significance of 
that portion of the range affected by the conservation plan; level of 
knowledge about the affected species and the degree of specificity of 
the species' conservation program under the conservation plan; and 
whether failure to adopt additional conservation measures would 
appreciably reduce the likelihood of survival and recovery of the 
affected species in the wild.
    Discussion: The first criterion is self-explanatory. The second 
identifies factors to be considered by the Services in determining 
whether the unforeseen circumstances are biologically significant. 
Generally, the inquiry would focus on the level of biological threats 
to the affected species covered by the HCP and the degree to which the 
welfare of those species is tied to a particular HCP. For example, if a 
species is declining rapidly, and the HCP encompasses an ecologically 
insignificant portion of the species' range, then unforeseen 
circumstances warranting reconsideration of an HCP's conservation 
program typically would not exist because the overall effect of the HCP 
upon the species would be negligible or insignificant. Conversely, if a 
species is declining rapidly and the HCP in question encompasses a 
majority of the species' range, then unforeseen circumstances 
warranting a review of an HCP's conservation program probably would 
exist. If unforeseen circumstances are found to exist, the Services 
will consider changes in the operating conservation program or 
additional mitigation measures. However, measures required of the 
permittee must be as close as possible to the terms of the original HCP 
and must be limited to modifications within any conserved habitat area 
or to adjustments within lands or waters that are already set aside in 
the HCP's operating conservation program. ``Conserved habitat areas'' 
are areas explicitly designated for habitat restoration, acquisition, 
protection, or other conservation uses under an HCP. An ``operating 
conservation program'' consists of the conservation management 
activities, which are expressly agreed upon and described in an HCP or 
its Implementing Agreement and that are undertaken for the affected 
species when implementing an approved HCP. Any adjustments or 
modifications will not include requirements for additional land, water, 
or financial compensation, or additional restrictions on the use of 
land, water (including quantity and timing of delivery), or other 
natural resources otherwise available for development or use under the 
HCP, unless the permittee consents to such additional measures.
    Modifications within conserved habitat areas or to the HCP's 
operating conservation program means changes to the plan areas 
explicitly designated for habitat protection or other conservation uses 
under the HCP, or changes that increase the effectiveness of the HCP's 
operating conservation program, provided that any such changes do not 
impose new restrictions or require additional financial compensation on 
the permittee's activities. Thus, if an HCP's operating conservation 
program originally included a mixture of predator depredation control 
and captive breeding, but subsequent

[[Page 8869]]

research or information demonstrated that one of these was considerably 
more effective than the other, the Services would be able to request an 
adjustment in the proportionate use of these tools, provided that such 
an adjustment did not increase the overall costs to the HCP permittee. 
Additionally, the No Surprises assurance does not preclude any Federal 
agency from exercising its Federal reserved water rights.
    The ``Unforeseen circumstances'' section of the HCP should discuss 
the process for addressing those future changes in circumstances 
surrounding the HCP that could not reasonably be anticipated by HCP 
planners. While HCP permittees will not be responsible for bearing any 
additional economic burden for more mitigation measures, other methods 
remain available to respond to the needs of the affected species and to 
assure that the goals of the ESA are satisfied. These include 
increasing the effectiveness of the HCP's operating conservation 
program by adjusting the program in a way that does not result in a net 
increase in costs to the permittee, and actions taken by the government 
or voluntary conservation measures taken by the permittee.
    When negotiating the unforeseen provisions in an HCP, the permittee 
cannot be required to commit additional land, funds, or additional 
restrictions on lands, water (including quantity and timing of 
delivery) or other natural resources released under an HCP for 
development or use from any permittee who is implementing the HCP and 
is abiding by all of the permit terms and conditions in good faith or 
has fully implemented their commitments under an approved HCP. 
Moreover, this rule does not preempt or affect any Federal reserved 
water rights.
    In the event of unforeseen circumstances, the Services will work 
with the permittee to increase the effectiveness of the HCP's operating 
conservation program to address the unforeseen circumstances without 
requiring the permittee to provide an additional commitment of 
resources as stated above. The specific nature of the requested changes 
to the operating conservation program will vary among HCPs depending 
upon individual habitat and species needs.
    5. Nothing in this rule will be construed to limit or constrain the 
Services, any Federal, State, local, or Tribal government agency, or a 
private entity, from taking additional actions at its own expense to 
protect or conserve a species included in a conservation plan.
    Discussion: This means the Services or other entities can intervene 
on behalf of a species at their own expense at any time and be 
consistent with the assurances provided to the permittee under this 
final rule. However, it is unlikely that the Services would have to 
resort to protective or conservation action requiring new 
appropriations of funds by Congress in order to meet their commitment 
under this final rule (consistent with their obligations under the 
ESA). If this unlikely event occurred, these actions would be subject 
to the requirements of the Anti-Deficiency Act and the availability of 
funds appropriated by Congress.
    Also, nothing in this final rule prevents the Services from asking 
a permittee to voluntarily undertake additional mitigation on behalf of 
affected species. While an HCP permittee who has been implementing the 
HCP and permit terms and conditions in good faith would not be 
obligated to provide additional mitigation, the Services believe that 
many landowners would be willing to consider additional conservation 
assistance on a voluntary basis if a compelling argument for assistance 
could be made.
    The Services believe that it will be rare for unforeseen 
circumstances to result in a jeopardy situation. However, in such 
cases, the Services will use all of their authorities, will work with 
other Federal agencies to rectify the situation, and work with the 
permittee to redirect conservation and mitigation measures so as to 
offset the likelihood of jeopardy. The Services have a wide array of 
authorities and resources that can be used to provide additional 
protection for threatened or endangered species covered by an HCP.

Required Determinations

    A major purpose of this final rule is to provide section 
10(a)(1)(B) permittees regulatory assurances related to the issuance of 
an HCP permit. From the Federal government's perspective, 
implementation of this rule would not result in additional expenditures 
to the permittee that are above and beyond that already required 
through the section 10(a)(1)(B) permitting process. There are, however, 
benefits derived from HCPs for both the non-Federal permittees and the 
species covered by the HCPs. HCPs are mechanisms that allow non-Federal 
entities to continue with economic use or development activities, while 
factoring species' conservation needs into natural resource management 
decisions. Benefits to the covered species may include the conservation 
of lands and waters upon which the species depends, decreased habitat 
fragmentation, the removal of threats to candidate, proposed, or other 
unlisted species, and in various instances, advancement of the recovery 
of listed species. Non-Federal entities are then provided regulatory 
assurances pursuant to an approved incidental take permit under section 
10(a)(1)(B) of the ESA for those species that are adequately covered by 
the permit, conditioned, of course, on the proper implementation of the 
HCP. Since the Habitat Conservation Plan Assurances (``No Surprises'' 
policy) impose no additional economic costs or burdens upon an HCP 
permittee, the Services have determined that the final rule would not 
result in significant costs of implementation to non-Federal entities.

Information Collection/Paperwork Reduction Act

    No significant effects are expected on non-Federal entities 
exercising their option to enter into the HCP planning program because 
there is no additional information required during the HCP development 
or processing phase due solely to these regulatory assurances.
    The Services have examined this final rule under the Paperwork 
Reduction Act of 1995 and found it to contain no requests for 
additional information or increase in the collection requirements 
associated with incidental take permits other than those already 
approved for incidental take permits with OMB approval #1018-0094, 
which has an expiration date of February 28, 2001.

Economic Analysis

    This final rule was subject to Office of Management and Budget 
review under Executive Order 12866. However, the Services have 
determined that there will be no additional costs placed on the non-
Federal entity associated with this final regulation. The No Surprises 
policy, which was drafted in 1994, went through a public comment period 
as part of the draft 1994 Habitat Conservation Planning Handbook (59 FR 
65782, December 21, 1994), was included in the final 1996 Habitat 
Conservation Planning Handbook (61 FR 63854, December 2, 1996), and 
currently is being implemented in individual HCP permits as they are 
issued after an opportunity for public comment. The No Surprises 
assurances provided to permittees through these final rules apply to 
the HCP permitting process only, and the Services have determined that 
there will be no additional information required of non-Federal 
entities through the HCP permitting process to provide assurances to 
the permittee.
    The Department of the Interior has certified that this rulemaking 
will not

[[Page 8870]]

have a significant economic impact on a substantial number of small 
entities, which includes businesses, organizations, or governmental 
jurisdictions. This final rule will provide non-Federal entities 
regulatory certainty pursuant to an approved incidental take permit 
under section 10(a)(1)(B) of the Act. No significant effects are 
expected on non-Federal entities exercising their option to enter into 
the HCP planning program because there will be no additional 
information required through the HCP process due to the application of 
assurances or ``No Surprises.'' Therefore, this rule would have a 
minimal effect on such entities. NMFS has also reviewed this rule under 
the Regulatory Flexibility Act of 1980 and concurs with the above 
certification.
    The implementation of the final Habitat Conservation Plan 
Assurances rule does not require any additional data not already 
required by the HCP process. Regulatory assurances are provided to the 
permittee if the HCP is properly implemented, and if all the terms and 
conditions of the HCP, permit, or Implementing Agreement are all being 
met. The underlying economic basis of comparing the final rule with and 
without the assurances was used to determine if there existed any 
potential economic effects from implementing this policy. Since the 
rule is being implemented with existing data, there are no incremental 
costs being imposed on non-Federal landowners. The benefits generated 
by this rule are being shared by the Services (i.e., less habitat 
fragmentation, habitat management, and protection for covered species) 
and by non-Federal landowners (i.e., assurances that approved HCPs will 
allow for future economic uses of non-Federal land without further 
conservation and mitigation measures).
    There are no specific data to assess the effects on businesses from 
this rule. To the extent businesses are affected, however, such effects 
would be positive, not negative. Until specific HCPs are approved, it 
is not possible to determine effects on commodity prices, competition 
or jobs. Moreover, any economic effects would likely be tied to the 
cost of the development and implementation of the HCP itself and not to 
these assurances. There is a positive effect expected on the 
environment because these assurances act as an incentive for non-
Federal entities to seek HCPs and to factor species conservation needs 
into national resources management decisions. No effect on public 
health and safety is expected from this rule. Therefore, this rule most 
likely would not have a significant effect on a substantial number of 
small entities.
    The Services have determined and certify pursuant to the Unfunded 
Mandates Act, 2 U.S.C. 1502 et seq., that this rulemaking will not 
impose a cost of $100 million or more in any given year on local or 
State governments or private entities. No additional information will 
be required from a non-Federal entity solely as a result of these 
assurances.

Civil Justice Reform

    The Departments have determined that these final regulations meet 
the applicable standards provided in sections 3(a) and 3(b)(2) of 
Executive Order 12988.

National Environmental Policy Act

    The Department has determined that the issuance of the final rule 
is categorically excluded under the Department of the Interior's NEPA 
procedures in 516 DM 2, Appendix 1.10. NMFS concurs with the Department 
of Interior's determination that the issuance of the final rule 
qualifies for a categorical exclusion and falls within the categorical 
exclusion criteria in NOAA 216-3 Administrative Order, Environmental 
Review Procedure.

List of Subjects

50 CFR Part 17

    Endangered and threatened species, Exports, Imports, Reporting and 
recordkeeping requirements, Transportation.

50 CFR Part 222

    Administrative practices and procedure, Endangered and threatened 
species, Exports, Imports, Reporting and recordkeeping requirements, 
Transportation.

    For the reasons set out in the preamble, the Services amend Title 
50, Chapter I, subchapter B; and Title 50, Chapter II, subchapter C of 
the Code of Federal Regulations, as set forth below:

PART 17--[AMENDED]

Subpart C--Endangered Wildlife

    1. The authority citation for part 17 continues to read as follows:

    Authority: 16 U.S.C. 1361-1407; 16 U.S.C. 1531-1544; 16 U.S.C. 
4201-4245; Pub. L. 99-625, 100 Stat. 3500; unless otherwise noted.
    2. The FWS amends Sec. 17.3 by adding the following definitions 
alphabetically to read as follows:
* * * * *
    Adequately covered means, with respect to species listed pursuant 
to section 4 of the ESA, that a proposed conservation plan has 
satisfied the permit issuance criteria under section 10(a)(2)(B) of the 
ESA for the species covered by the plan, and, with respect to unlisted 
species, that a proposed conservation plan has satisfied the permit 
issuance criteria under section 10(a)(2)(B) of the ESA that would 
otherwise apply if the unlisted species covered by the plan were 
actually listed. For the Services to cover a species under a 
conservation plan, it must be listed on the section 10(a)(1)(B) permit.
* * * * *
    Changed circumstances means changes in circumstances affecting a 
species or geographic area covered by a conservation plan that can 
reasonably be anticipated by plan developers and the Service and that 
can be planned for (e.g., the listing of new species, or a fire or 
other natural catastrophic event in areas prone to such events).
    Conserved habitat areas means areas explicitly designated for 
habitat restoration, acquisition, protection, or other conservation 
purposes under a conservation plan.
    Conservation plan means the plan required by section 10(a)(2)(A) of 
the ESA that an applicant must submit when applying for an incidental 
take permit. Conservation plans also are known as ``habitat 
conservation plans'' or ``HCPs.''
* * * * *
    Operating conservation program means those conservation management 
activities which are expressly agreed upon and described in a 
conservation plan or its Implementing Agreement, if any, and which are 
to be undertaken for the affected species when implementing an approved 
conservation plan, including measures to respond to changed 
circumstances.
* * * * *
    Properly implemented conservation plan means any conservation plan, 
Implementing Agreement and permit whose commitments and provisions have 
been or are being fully implemented by the permittee.
* * * * *
    Unforeseen circumstances means changes in circumstances affecting a 
species or geographic area covered by a conservation plan that could 
not reasonably have been anticipated by plan developers and the Service 
at the time of the conservation plan's negotiation and development, and 
that result in a substantial and adverse

[[Page 8871]]

change in the status of the covered species.
* * * * *
    3. The FWS amends Sec. 17.22 by adding paragraphs (b) (5) and (6) 
to read as follows:


Sec. 17.22  Permits for scientific purposes, enhancement of propagation 
or survival, or for incidental taking.

* * * * *
    (b) * * *
    (5) Assurances provided to permittee in case of changed or 
unforeseen circumstances. The assurances in this paragraph (b)(5) apply 
only to incidental take permits issued in accordance with paragraph 
(b)(2) of this section where the conservation plan is being properly 
implemented, and apply only with respect to species adequately covered 
by the conservation plan. These assurances cannot be provided to 
Federal agencies. This rule does not apply to incidental take permits 
issued prior to March 25, 1998. The assurances provided in incidental 
take permits issued prior to March 25, 1998 remain in effect, and those 
permits will not be revised as a result of this rulemaking.
    (i) Changed circumstances provided for in the plan. If additional 
conservation and mitigation measures are deemed necessary to respond to 
changed circumstances and were provided for in the plan's operating 
conservation program, the permittee will implement the measures 
specified in the plan.
    (ii) Changed circumstances not provided for in the plan. If 
additional conservation and mitigation measures are deemed necessary to 
respond to changed circumstances and such measures were not provided 
for in the plan's operating conservation program, the Director will not 
require any conservation and mitigation measures in addition to those 
provided for in the plan without the consent of the permittee, provided 
the plan is being properly implemented.
    (iii) Unforeseen circumstances. (A) In negotiating unforeseen 
circumstances, the Director will not require the commitment of 
additional land, water, or financial compensation or additional 
restrictions on the use of land, water, or other natural resources 
beyond the level otherwise agreed upon for the species covered by the 
conservation plan without the consent of the permittee.
    (B) If additional conservation and mitigation measures are deemed 
necessary to respond to unforeseen circumstances, the Director may 
require additional measures of the permittee where the conservation 
plan is being properly implemented, but only if such measures are 
limited to modifications within conserved habitat areas, if any, or to 
the conservation plan's operating conservation program for the affected 
species, and maintain the original terms of the conservation plan to 
the maximum extent possible. Additional conservation and mitigation 
measures will not involve the commitment of additional land, water or 
financial compensation or additional restrictions on the use of land, 
water, or other natural resources otherwise available for development 
or use under the original terms of the conservation plan without the 
consent of the permittee.
    (C) The Director will have the burden of demonstrating that 
unforeseen circumstances exist, using the best scientific and 
commercial data available. These findings must be clearly documented 
and based upon reliable technical information regarding the status and 
habitat requirements of the affected species. The Director will 
consider, but not be limited to, the following factors:
    (1) Size of the current range of the affected species;
    (2) Percentage of range adversely affected by the conservation 
plan;
    (3) Percentage of range conserved by the conservation plan;
    (4) Ecological significance of that portion of the range affected 
by the conservation plan;
    (5) Level of knowledge about the affected species and the degree of 
specificity of the species' conservation program under the conservation 
plan; and
    (6) Whether failure to adopt additional conservation measures would 
appreciably reduce the likelihood of survival and recovery of the 
affected species in the wild.
    (6) Nothing in this rule will be construed to limit or constrain 
the Director, any Federal, State, local, or Tribal government agency, 
or a private entity, from taking additional actions at its own expense 
to protect or conserve a species included in a conservation plan.

Subpart D--Threatened Wildlife

    4. The FWS amends Sec. 17.32 by adding paragraphs (b)(5) and (6) to 
read as follows:


Sec. 17.32   Permits--general.

* * * * *
    (b) * * *
    (5) Assurances provided to permittee in case of changed or 
unforeseen circumstances. The assurances in this paragraph (b)(5) apply 
only to incidental take permits issued in accordance with paragraph 
(b)(2) of this section where the conservation plan is being properly 
implemented, and apply only with respect to specifies adequately 
covered by the conservation plan. These assurances cannot be provided 
to Federal agencies. This rule does not apply to incidental take 
permits issued prior to [insert 30 days after the date of publication 
in the Federal Register]. The assurances provided in incidental take 
permits issued prior to [insert 30 days after the date of publication 
in the Federal Register] remain in effect, and those permits will not 
be revised as a result of this rulemaking.
    (i) Changed circumstances provided for in the plan. If additional 
conservation and mitigation measures are deemed necessary to respond to 
changed circumstances and were provided for in the plan's operating 
conservation program, the permittee will implement the measures 
specified in the plan.
    (ii) Changed circumstances not provided for in the plan. If 
additional conservation and mitigation measures are deemed necessary to 
respond to changed circumstances and such measures were not provided 
for in the plan's operating conservation program, the Director will not 
require any conservation and mitigation measures in addition to those 
provided for in the plan without the consent of the permittee, provided 
the plan is being properly implemented.
    (iii) Unforeseen circumstances. (A) In negotiating unforeseen 
circumstances, the Director will not require the commitment of 
additional land, water, or financial compensation or additional 
restrictions on the use of land, water, or other natural resources 
beyond the level otherwise agreed upon for the species covered by the 
conservation plan without the consent of the permittee.
    (B) If additional conservation and mitigation measures are deemed 
necessary to respond to unforeseen circumstances, the Director may 
require additional measures of the permittee where the conservation 
plan is being properly implemented, but only if such measures are 
limited to modifications within conserved habitat areas, if any, or to 
the conservation plan's operating conservation program for the affected 
species, and maintain the original terms of the conservation plan to 
the maximum extent possible. Additional conservation and mitigation 
measures will not involve the commitment of additional land, water or 
financial compensation or additional restrictions on the use of land, 
water, or other natural resources otherwise available for development 
or use under the original

[[Page 8872]]

terms of the conservation plan without the consent of the permittee.
    (C) The Director will have the burden of demonstrating that such 
unforeseen circumstances exist, using the best scientific and 
commercial data available. These findings must be clearly documented 
and based upon reliable technical information regarding the status and 
habitat requirements of the affected species. The Director will 
consider, but not be limited to, the following factors:
    (1) Size of the current range of the affected species;
    (2) Percentage of range adversely affected by the conservation 
plan;
    (3) Percentage of range conserved by the conservation plan;
    (4) Ecological significance of that portion of the range affected 
by the conservation plan;
    (5) Level of knowledge about the affected species and the degree of 
specificity of the species' conservation program under the conservation 
plan; and
    (6) Whether failure to adopt additional conservation measures would 
appreciably reduce the likelihood of survival and recovery of the 
affected species in the wild.
    (6) Nothing in this rule will be construed to limit or constrain 
the Director, any Federal, State, local, or Tribal government agency, 
or a private entity, from taking additional actions at its own expense 
to protect or conserve a species included in a conservation plan.

PART 222--ENDANGERED FISH OR WILDLIFE

    5. The authority citation for part 222 is revised to read as 
follows:

    Authority: 16 U.S.C. 1531-1543 and 16 U.S.C. 1361 et seq.

Subpart C--Endangered Fish or Wildlife Permits

    6. In part 222, a new section is added to read as follows:


222.3  Definitions.

    These definitions apply only to Sec. 222.22:
    Adequately covered means, with respect to species listed pursuant 
to section 4 of the ESA, that a proposed conservation plan has 
satisfied the permit issuance criteria under section 10(a)(2)(B) of the 
ESA for the species covered by the plan and, with respect to unlisted 
species, that a proposed conservation plan has satisfied the permit 
issuance criteria under section 10(a)(2)(B) of the ESA that would 
otherwise apply if the unlisted species covered by the plan were 
actually listed. For the Services to cover a species under a 
conservation plan, it must be listed on the section 10(a)(1)(B) permit.
    Changed circumstances means changes in circumstances affecting a 
species or geographic area covered by a conservation plan that can 
reasonably be anticipated by plan developers and NMFS and that can be 
planned for (e.g., the listing of new species, or a fire or other 
natural catastrophic event in areas prone to such events).
    Conserved habitat areas means areas explicitly designated for 
habitat restoration, acquisition, protection, or other conservation 
purposes under a conservation plan.
    Conservation plan means the plan required by section 10(a)(2)(A) of 
the ESA that an applicant must submit when applying for an incidental 
take permit. Conservation plans also are known as ``habitat 
conservation plans'' or ``HCPs.''
    Operating conservation program means those conservation management 
activities which are expressly agreed upon and described in a 
conservation plan or its Implementing Agreement, if any, and which are 
to be undertaken for the affected species when implementing an approved 
conservation plan, including measures to respond to changed 
circumstances.
    Properly implemented conservation plan means any conservation plan, 
Implementing Agreement and permit whose commitments and provisions have 
been or are being fully implemented by the permittee.
    Unforeseen circumstances means changes in circumstances affecting a 
species or geographic area covered by a conservation plan that could 
not reasonably have been anticipated by plan developers and NMFS at the 
time of the conservation plan's negotiation and development, and that 
result in a substantial and adverse change in the status of the covered 
species.


Sec. 222.22  [Amended]

    7. In Sec. 222.22, paragraphs (g) and (h) are added.
* * * * *
    (g) Assurances provided to permittee in case of changed or 
unforeseen circumstances. The assurances in this paragraph (g) apply 
only to incidental take permits issued in accordance with paragraph (c) 
of this section where the conservation plan is being properly 
implemented, and apply only with respect to species adequately covered 
by the conservation plan. These assurances cannot be provided to 
Federal agencies. This rule does not apply to incidental take permits 
issued prior to March 25, 1998. The assurances provided in incidental 
take permits issued prior to March 25, 1998 remain in effect, and those 
permits will not be revised as a result of this rulemaking.
    (1) Changed circumstances provided for in the plan. If additional 
conservation and mitigation measures are deemed necessary to respond to 
changed circumstances and were provided for in the plan's operating 
conservation program, the permittee will implement the measures 
specified in the plan.
    (2) Changed circumstances not provided for in the plan. If 
additional conservation and mitigation measures are deemed necessary to 
respond to changed circumstances and such measures were not provided 
for in the plan's operating conservation program, NMFS will not require 
any conservation and mitigation measures in addition to those provided 
for in the plan without the consent of the permittee, provided the plan 
is being properly implemented.
    (3) Unforeseen circumstances. (i) In negotiating unforeseen 
circumstances, NMFS will not require the commitment of additional land, 
water, or financial compensation or additional restrictions on the use 
of land, water, or other natural resources beyond the level otherwise 
agreed upon for the species covered by the conservation plan without 
the consent of the permittee.
    (ii) If additional conservation and mitigation measures are deemed 
necessary to respond to unforeseen circumstances, NMFS may require 
additional measures of the permittee where the conservation plan is 
being properly implemented, but only if such measures are limited to 
modifications within conserved habitat areas, if any, or to the 
conservation plan's operating conservation program for the affected 
species, and maintain the original terms of the conservation plan to 
the maximum extent possible. Additional conservation and mitigation 
measures will not involve the commitment of additional land, water or 
financial compensation or additional restrictions on the use of land, 
water, or other natural resources otherwise available for development 
or use under the original terms of the conservation plan without the 
consent of the permittee.
    (iii) NMFS will have the burden of demonstrating that unforeseen 
circumstances exist, using the best scientific and commercial data 
available. These findings must be clearly documented and based upon 
reliable technical information regarding the status and habitat 
requirements of the affected species. NMFS will

[[Page 8873]]

consider, but not be limited to, the following factors:
    (A) Size of the current range of the affected species;
    (B) Percentage of range adversely affected by the conservation 
plan;
    (C) Percentage of range conserved by the conservation plan;
    (D) Ecological significance of that portion of the range affected 
by the conservation plan;
    (E) Level of knowledge about the affected species and the degree of 
specificity of the species' conservation program under the conservation 
plan; and
    (F) Whether failure to adopt additional conservation measures would 
appreciably reduce the likelihood of survival and recovery of the 
affected species in the wild.
    (h) Nothing in this rule will be construed to limit or constrain 
the Assistant Administrator, any Federal, State, local, or tribal 
government agency, or a private entity, from taking additional actions 
at its own expense to protect or conserve a species included in a 
conservation plan.

    Dated: February 13, 1998.
Rolland A. Schmitten,
Assistant Administrator for Fisheries, National Marine Fisheries 
Service.

    Dated: February 11, 1998.
Donald J. Barry,
Acting Assistant Secretary, Fish, Wildlife, and Parks, Department of 
Interior.
[FR Doc. 98-4367 Filed 2-20-98; 8:45 am]
BILLING CODE 4310-55-P