[Federal Register Volume 81, Number 28 (Thursday, February 11, 2016)]
[Rules and Regulations]
[Pages 7226-7248]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2016-02677]


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DEPARTMENT OF THE INTERIOR

Fish and Wildlife Service

DEPARTMENT OF COMMERCE

National Oceanic and Atmospheric Administration

50 CFR Part 424

[Dockets FWS-R9-ES-2011-0104 and 120206102-5603-03; 4500030114]
RIN 1018-AX87; 0648-BB82


Policy Regarding Implementation of Section 4(b)(2) of the 
Endangered Species Act

AGENCY: U.S. Fish and Wildlife Service (FWS), Interior; National Marine 
Fisheries Service (NMFS), National Oceanic and Atmospheric 
Administration, Commerce.

ACTION: Notice of final policy.

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SUMMARY: We, the U.S Fish and Wildlife Service and the National Marine 
Fisheries Service, (jointly, the ``Services'') announce our final 
policy on exclusions from critical habitat under the Endangered Species 
Act. This non-binding policy provides the Services' position on how we 
consider partnerships and conservation plans, conservation plans 
permitted under section 10 of the Act, Tribal lands, national-security 
and homeland-security impacts and military lands, Federal lands, and 
economic impacts in the exclusion process. This policy complements our 
implementing regulations regarding impact analyses of critical habitat 
designations and is intended to clarify expectations regarding critical 
habitat and provide for a more predictable and transparent critical-
habitat-exclusion process.

DATES: This policy is effective March 14, 2016.

ADDRESSES: You may review the reference materials and public input used 
in the creation of this policy at http://www.regulations.gov at Docket 
No. FWS-R9-ES-2011-0104. Some of these materials are also available for 
public inspection at U.S. Fish and Wildlife Service, Division of 
Conservation and Classification, MS: ES, 5275 Leesburg Pike, Falls 
Church, VA 22041-3803 during normal business hours.

FOR FURTHER INFORMATION CONTACT: Douglas Krofta, U.S. Fish and Wildlife 
Service, Division of Conservation and Classification, MS: ES, 5275 
Leesburg Pike, Falls Church, VA 22041-3803; telephone 703/358-2171; 
facsimile 703/358-1735; or Marta Nammack, National Marine Fisheries 
Service, Office of Protected Resources, 1315 East-West Highway, Silver 
Spring, MD 20910; telephone 301/427-8469; facsimile 301/713-0376. If 
you use a telecommunications device for the deaf (TDD), call the 
Federal Information Relay Service (FIRS) at 800-877-8339.

SUPPLEMENTARY INFORMATION: Today, we publish in the Federal Register 
three related documents that are final agency actions. This document is 
one of the three, of which two are final rules and one is a final 
policy:
     A final rule that amends the regulations governing section 
7 consultation under the Endangered Species Act to revise the 
definition of ``destruction or adverse modification'' of critical 
habitat. That regulatory definition had been invalidated by several 
courts for being inconsistent with the Act. This final rule amends 
title 50 of the Code of Federal Regulations (CFR) at part 402. The 
Regulation Identifier Numbers (RIN) are 1018-AX88 and 0648-BB82, and 
the final rule may be found on http://www.regulations.gov at Docket No. 
FWS-R9-ES-2011-0072.
     A final rule that amends the regulations governing the 
designation of critical habitat under section 4 of the Act. A number of 
factors, including litigation and the Services' experience over the 
years in interpreting and applying the statutory definition of 
``critical habitat,'' highlighted the need to clarify or revise the 
regulations. This final rule amends 50 CFR part 424. It is published 
under RINs 1018-AX86 and 0648-BB79 and may be found on http://www.regulations.gov at Docket No. FWS-HQ-ES-2012-0096.
     A final policy pertaining to exclusions from critical 
habitat and how we may consider partnerships and conservation plans, 
conservation plans permitted under section 10 of the Act, Tribal lands, 
national-security and homeland-security impacts and military lands, 
Federal lands, and economic impacts in the exclusion process. This 
final policy complements the final rule amending 50 CFR 424.19 and 
provides for a predictable and transparent exclusion process. The 
policy is published under RINs 1018-AX87 and 0648-BB82 and is set forth 
below in this document. The policy may be found on http://www.regulations.gov at Docket No. FWS-R9-ES-2011-0104.

Background

    The National Marine Fisheries Service (NMFS) and U.S. Fish and 
Wildlife Service (FWS) are charged with implementing the Endangered 
Species Act of 1973, as amended (16 U.S.C. 1531 et seq.) (Act), the 
goal of which is to provide a means to conserve the ecosystems upon 
which listed species depend and to provide a program for listed species 
conservation. Critical habitat is one tool in the Act that Congress 
established to achieve species conservation. In section 3(5)(A) of the 
Act Congress defined ``critical habitat'' as:
    (i) The specific areas within the geographical area occupied by the 
species, at the time it is listed in accordance with the provisions of 
section 4 of this Act, on which are found those physical or biological 
features (I) essential to the conservation of the species and (II) 
which may require special management considerations or protection; and
    (ii) specific areas outside the geographical area occupied by the 
species at the time it is listed in accordance with the provisions of 
section 4 of this Act, upon a determination by the Secretary that such 
areas are essential for the conservation of the species.
    Specifying the geographic location of critical habitat helps 
facilitate implementation of section 7(a)(1) by identifying areas where 
Federal agencies can focus their conservation programs and use their 
authorities to further the purposes of the Act. In addition to serving 
as an educational tool, the designation of critical habitat also 
provides a significant regulatory protection--the requirement that 
Federal agencies consult with the

[[Page 7227]]

Services under section 7(a)(2) to insure their actions are not likely 
to destroy or adversely modify critical habitat.
    Section 4 of the Act requires the Services to designate critical 
habitat, and sets out standards and processes for determining critical 
habitat. Congress authorized the Secretaries to ``exclude any area from 
critical habitat if [s]he determines that the benefits of exclusion 
outweigh the benefits of specifying such area as part of the critical 
habitat, unless [s]he determines, based on the best scientific and 
commercial data available, that the failure to designate such area as 
critical habitat will result in the extinction of the species 
concerned'' (section 4(b)(2)).
    Over the years, legal challenges have been brought to the Services' 
process for considering exclusions. Several court decisions have 
addressed the Services' implementation of section 4(b)(2). In 2008, the 
Solicitor of the Department of the Interior issued a legal opinion on 
implementation of section 4(b)(2) (http://www.doi.gov/solicitor/opinions.html). That opinion is based on the text of the Act and 
principles of statutory interpretation and relevant case law. The 
opinion explained the legal considerations that guide the Secretary's 
exclusion authority, and discussed and elaborated on the application of 
these considerations to the circumstances commonly faced by the 
Services (e.g., habitat conservation plans, Tribal lands).
    To provide greater predictability and transparency regarding how 
the Services generally consider exclusions under section 4(b)(2), the 
Services announce this final policy regarding several issues that 
frequently arise in the context of exclusions. This policy on 
implementation of specific aspects of section 4(b)(2) does not cover 
the entire range of factors that may be considered as the basis for an 
exclusion in any given designation, nor does it serve as a 
comprehensive interpretation of all the provisions of section 4(b)(2).
    This final policy sets forth the Services' position regarding how 
we consider partnerships and conservation plans, conservation plans 
permitted under section 10 of the Act, Tribal lands, national-security 
and homeland-security impacts and military lands, Federal lands, and 
economic impacts in the exclusion process. The Services intend to apply 
this policy when considering exclusions from critical habitat. That 
being said, under the terms of the policy, the Services retain a great 
deal of discretion in making decisions with respect to exclusions from 
critical habitat. This policy does not mandate particular outcomes in 
future decisions on critical habitat designations.

Changes to the Proposed Policy Elements

    Below are a summary of changes to the proposed policy elements as a 
result of public comment and review. The final policy elements can be 
found at the end of this policy.
    1. Added language to policy element 2 to make clear that the list 
presented in this policy is not a list of requirements for non-
permitted plans, but rather factors the Services will use to evaluate 
non-permitted plans and partnerships. This list is not exclusive; all 
items may not apply to every plan.
    2. In policy element 2(c), added text to the criterion in the non-
permitted plans policy element to clarify that required determinations 
may be a factor considered in a discretionary 4(b)(2) exclusion 
analysis where such determinations are ``necessary and appropriate.''
    3. Removed the phrase, ``not just providing guidelines,'' from 
paragraph 3(c).
    4. Made several other minor edits to increase clarity and 
readability of the policy elements.

Implementation of Section 4(b)(2) of the Act

    On August 28, 2013 (78 FR 53058), the Services published a final 
rule revising 50 CFR 424.19. In that rule the Services elaborated on 
the process and standards for implementing section 4(b)(2) of the Act. 
This final policy is meant to complement those revisions to 50 CFR 
424.19, and provides further clarification as to how the Services will 
implement section 4(b)(2) when designating critical habitat.
    Section 4(b)(2) of the Act provides that:

The Secretary shall designate critical habitat, and make revisions 
thereto, under subsection (a)(3) on the basis of the best scientific 
data available and after taking into consideration the economic 
impact, the impact on national security, and any other relevant 
impact, of specifying any particular area as critical habitat. The 
Secretary may exclude any area from critical habitat if [s]he 
determines that the benefits of such exclusion outweigh the benefits 
of specifying such area as part of the critical habitat, unless 
[s]he determines, based on the best scientific and commercial data 
available, that the failure to designate such area as critical 
habitat will result in the extinction of the species concerned.

    In 1982, Congress added this provision to the Act, both to require 
the Services to consider the relevant impacts of designating critical 
habitat and to provide a means for the Services to reduce potentially 
negative impacts of designation by excluding, in appropriate 
circumstances, particular areas from a designation. The first sentence 
of section 4(b)(2) sets out a mandatory requirement that the Services 
consider the economic impact, impact on national security, and any 
other relevant impacts prior to designating an area as part of a 
critical habitat designation. The Services always consider such 
impacts, as required under this sentence, for each and every 
designation of critical habitat. (Although the term ``homeland 
security'' was not in common usage in 1982, the Services conclude that 
Congress intended that ``national security'' includes what we now refer 
to as ``homeland security.'')
    The second sentence of section 4(b)(2) outlines a separate, 
discretionary process by which the Secretaries may elect to determine 
whether to exclude an area from the designation, by performing an 
exclusion analysis. The Services use their consideration of impacts 
under the first sentence of section 4(b)(2), their consideration of 
whether to engage in the discretionary exclusion analysis under the 
second sentence of section 4(b)(2), and any exclusion analysis that the 
Services undertake, as the primary basis for satisfying the provisions 
of Executive Orders 12866 and 13563. E.O. 12866 (incorporated by E.O. 
13563) requires agencies to assess the costs and benefits of a rule, 
and, to the extent permitted by law, to propose or adopt the rule only 
upon a reasoned determination that the benefits of the intended 
regulation justify the costs.
    Conducting an exclusion analysis under section 4(b)(2) involves 
balancing or weighing the benefits of excluding a particular area from 
a designation of critical habitat against the benefits of including 
that area in the designation. If the benefits of exclusion outweigh the 
benefits of inclusion, the Secretaries may exclude the particular area, 
unless they determine that the exclusion will result in the extinction 
of the species concerned. The discretionary 4(b)(2) exclusion analysis 
is fully consistent with the E.O. requirements in that the analysis 
permits excluding an area where the benefits of exclusion outweigh the 
benefits of inclusion, and would not lead to exclusion of an area when 
the benefits of exclusion do not outweigh the benefits of inclusion.
    This policy sets forth specific categories of information that we 
often consider when we enter into the discretionary 4(b)(2) exclusion 
analysis and exercise the Secretaries' discretion to exclude areas from 
critical habitat. We do not intend to cover in these examples all the 
categories of

[[Page 7228]]

information that may be relevant, or to limit the Secretaries' 
discretion to consider and assign weight to any relevant benefits as 
appropriate.
    Moreover, our implementing regulations at 50 CFR 424.19 further 
clarify the exclusion process for critical habitat and address 
statutory changes and case law. The regulations at 50 CFR 424.19, as 
well as the statute itself, state that the Secretaries have the 
discretion to exclude any particular area from the critical habitat 
upon a determination that the benefits of such exclusion outweigh the 
benefits of specifying the particular area as part of the critical 
habitat. Furthermore, the Secretaries may consider any relevant 
benefits. The weight and consideration given to those benefits is 
within the discretion of the Secretaries. The regulations at 50 CFR 
424.19 provide the framework for how the Services intend to implement 
section 4(b)(2) of the Act. This policy further details the discretion 
available to the Services (acting for the Secretaries), and provides 
detailed examples of how the Services may consider partnerships and 
conservation plans, conservation plans permitted under section 10 of 
the Act, Tribal lands, national-security and homeland-security impacts 
and military lands, Federal lands, and economic impacts in the 
exclusion process when we undertake a discretionary 4(b)(2) exclusion 
analysis.

General Framework for Considering an Exclusion and Conducting a 
Discretionary 4(b)(2) Exclusion Analysis

    When the Services determine that critical habitat is prudent and 
determinable for species listed as endangered or threatened species 
under the Act, they must follow the statutory and regulatory provisions 
of the Act to designate critical habitat. The Act's language makes 
clear that biological considerations drive the initial step of 
identifying critical habitat. First, the Act's definition of ``critical 
habitat'' requires the Secretaries to identify areas based on the 
conservation needs of the species. Second, section 4(b)(2) expressly 
requires designations to be made based on the best scientific data 
available. (It is important to note that, once the Secretaries identify 
specific areas that meet the definition of ``critical habitat,'' the 
Secretaries do not have the discretion to decline to recognize those 
areas as potential critical habitat. Only areas subject to an 
integrated natural resources management plan (INRMP) that meets the 
requirements of section 4(a)(3)(B)(i) are categorically ineligible for 
designation.)
    Having followed the biologically driven first step of identifying 
``critical habitat'' for a species, the Secretaries turn to the 
remaining procedures set forth in section 4(b)(2), which allow for 
consideration of whether those areas ultimately should be designated as 
critical habitat. Thus, pursuant to the first sentence of section 
4(b)(2), the Secretaries then undertake the mandatory consideration of 
impacts on the economy and national security, as well as any other 
impact that the Secretaries determine is relevant.
    The Act provides a mechanism that allows the Secretaries to exclude 
particular areas only upon a determination that the benefits of 
exclusion outweigh those of inclusion, so long as the exclusion will 
not result in the extinction of the species concerned. The Services 
call this the discretionary 4(b)(2) exclusion analysis. Neither the Act 
nor the implementing regulations at 50 CFR 424.19 require the 
Secretaries to conduct a discretionary 4(b)(2) exclusion analysis (see, 
e.g., Cape Hatteras Access Preservation Alliance v. DOI, 731 F. Supp. 
2d 15, 29-30 (D.D.C. 2010)). Rather, the Secretaries have discretion as 
to whether to conduct that analysis. If a Secretary decides not to 
consider exclusion of any particular area, no additional analysis is 
required. However, if the Secretary contemplates exclusion of a 
particular area, an initial screening may be conducted to evaluate 
potential exclusions. The Secretary may undertake a preliminary 
evaluation of any plans, partnerships, economic considerations, 
national-security considerations, or other relevant impacts identified 
after considering the impacts required by the first sentence of section 
4(b)(2). Following the preliminary evaluation, the Secretary may choose 
to enter into the discretionary 4(b)(2) exclusion analysis for any 
particular area. If the Secretary does so, the Secretary has broad 
discretion as to what factors to consider as benefits of inclusion and 
benefits of exclusion, and what weight to assign to each factor--
nothing in the Act, its implementing regulations, or this policy limits 
this discretion.
    When conducting a discretionary 4(b)(2) exclusion analysis, one of 
the factors that the Secretaries may consider is the effect of existing 
conservation plans or programs. Those plans and programs can reduce the 
benefits of including particular areas in a designation of critical 
habitat. To state this another way, because there are already 
conservation actions occurring on the ground as a result of the plan or 
program, the regulatory benefit of overlaying a designation of critical 
habitat may be reduced, because the designation may be redundant, or 
may provide little more conservation benefit compared to what is 
already being provided through the conservation plan or program. As a 
result, the existence of these conservation plans or programs reduces 
the benefits of including an area in critical habitat. As a matter of 
logic, however, the conservation benefits of an existing conservation 
plan or program generally cannot be considered benefits of excluding 
the area it covers from designation as critical habitat. This is 
because the conservation plan or program neither results from the 
exclusion being contemplated, nor is its continuation dependent on the 
exclusion being contemplated. The conservation plan or program is 
materially unaffected regardless of inclusion or exclusion from 
critical habitat.
    In addition, the Services wish to encourage and foster conservation 
partnerships, which can lead to future conservation plans that benefit 
listed species. This is particularly important because partnerships can 
lead to conservation actions that provide benefits, with respect to 
private lands, that often cannot be achieved through designation of 
critical habitat and section 7 consultations. Because conservation 
partnerships are voluntary, the Services have concluded that excluding 
areas covered by existing plans and programs can encourage land 
managers to partner with the Services in the future, by removing any 
real or perceived disincentives for engaging in conservation 
activities. Those future partnerships do not necessarily reduce the 
benefits of including an area in critical habitat now; they may, 
however, provide a benefit by encouraging future conservation action. 
That benefit is a benefit of excluding an area from the designation. 
Thus, an existing plan or program can reduce the benefits of inclusion 
of an area covered by the plan or program, and at the same time the 
Secretaries' choice to exclude the area may encourage future 
conservation partnerships. Moreover, because the fostering and 
maintenance of partnerships can greatly further the conservation goals 
of the Act, we generally give great weight to the benefits of excluding 
areas where we have demonstrated partnerships.
    In a discretionary 4(b)(2) exclusion analysis, the Services compare 
benefits of inclusion with benefits of exclusion. Some examples of 
benefits of including a particular area in critical habitat include, 
but are not limited to: (1) The educational benefits of identifying an 
area as critical habitat (e.g., general increase of awareness of listed 
species and their designated critical habitat);

[[Page 7229]]

and (2) the regulatory benefit of designating an area as critical 
habitat as realized through an adverse modification analysis in a 
section 7 consultation. As discussed above, these benefits of inclusion 
may be reduced by the conservation provisions of a plan or program, in 
that the educational benefit may have already been realized through 
development of the plan, and the on-the-ground conservation actions may 
already provide some or all of the benefit that could be reasonably 
expected as the outcome of a section 7 consultation. The weights 
assigned to the benefits of inclusion in any particular case are 
determined by the Secretaries. Some examples of benefits of excluding a 
particular area from critical habitat include: (1) Where there is an 
existing conservation plan or program, the encouragement of additional 
conservation partnerships in the future; and (2) the avoidance of 
probable negative incremental impacts from designating a particular 
area as critical habitat, including economic impacts and impacts to 
national security and public safety.
    The next step in the discretionary 4(b)(2) exclusion analysis is 
for the Secretaries to determine if the benefits of exclusion outweigh 
the benefits of inclusion for a particular area. If so, they may 
exclude that area, unless they determine that the exclusion will result 
in the extinction of the species concerned. We note that exclusions 
primarily based on conservation plans will likely maintain the overall 
level of protection for the species in question, because the plans will 
have reduced or eliminated the benefit of designating that area, as 
discussed above. In contrast, exclusions primarily based on economic or 
national security considerations may result in less overall protection 
for the species (i.e., forgoing significant benefits of inclusion). 
However, regardless of conservation outcome as outlined above, the 
Secretaries may still exclude such areas as long as they conclude that 
the benefits of exclusion outweigh the benefits of inclusion (and the 
exclusion itself would not result in extinction of the species).
Policy Elements
a. The Services' Discretion
    The Act affords a great degree of discretion to the Services in 
implementing section 4(b)(2). This discretion is applicable to a number 
of aspects of section 4(b)(2) including whether to enter into the 
discretionary 4(b)(2) exclusion analysis and the weights assigned to 
any particular factor used in the analysis. Most significant is that 
the decision to exclude is always discretionary, as the Act states that 
the Secretaries ``may'' exclude any areas. Under no circumstances is 
exclusion required under the second sentence of section 4(b)(2).
    This policy explains how the Services generally exercise their 
discretion to exclude an area when the benefits of exclusion outweigh 
the benefits of inclusion. In articulating this general practice, the 
Services do not intend to limit in any manner the discretion afforded 
to the Secretaries by the statute.
b. Private or Other Non-Federal Conservation Plans or Agreements and 
Partnerships, in General
    We sometimes exclude specific areas from critical habitat 
designations based in part on the existence of private or other non-
Federal conservation plans or agreements and their attendant 
partnerships. A conservation plan or agreement describes actions that 
are designed to provide for the conservation needs of a species and its 
habitat, and may include actions to reduce or mitigate negative effects 
on the species caused by activities on or adjacent to the area covered 
by the plan. Conservation plans or agreements can be developed by 
private entities with no Service involvement, or in partnership with 
the Services. In the case of a habitat conservation plan (HCP), safe 
harbor agreement (SHA), or a candidate conservation agreement with 
assurances (CCAA), a plan or agreement is developed in partnership with 
the Services for the purposes of attaining a permit under section 10 of 
the Act. See paragraph c, below, for a discussion of HCPs, SHAs, and 
CCAAs.
    We evaluate a variety of factors to determine how the benefits of 
any exclusion and the benefits of inclusion are affected by the 
existence of private or other non-Federal conservation plans or 
agreements and their attendant partnerships when we undertake a 
discretionary 4(b)(2) exclusion analysis. A non-exhaustive list of 
factors that we will consider for non-permitted plans or agreements is 
shown below. These factors are not required elements of plans or 
agreements, and all items may not apply to every plan or agreement.
    (i) The degree to which the record of the plan supports a 
conclusion that a critical habitat designation would impair the 
realization of benefits expected from the plan, agreement, or 
partnership;
    (ii) The extent of public participation in the development of the 
conservation plan;
    (iii) The degree to which there has been agency review and required 
determinations (e.g., State regulatory requirements), as necessary and 
appropriate;
    (iv) Whether National Environmental Policy Act (NEPA; 42 U.S.C. 
4321 et seq.) compliance was required;
    (v) The demonstrated implementation and success of the chosen 
mechanism;
    (vi) The degree to which the plan or agreement provides for the 
conservation of the essential physical or biological features for the 
species;
    (vii) Whether there is a reasonable expectation that the 
conservation management strategies and actions contained in a 
management plan or agreement will be implemented; and
    (viii) Whether the plan or agreement contains a monitoring program 
and adaptive management to ensure that the conservation measures are 
effective and can be modified in the future in response to new 
information.

The Services will consider whether a plan or agreement has previously 
been subjected to public comment, agency review, and NEPA compliance 
processes because that may indicate the degree of critical analysis the 
plan or agreement has already received. For example, if a particular 
plan was developed by a county-level government that had been required 
to comply with a State-based environmental-quality regulation, the 
Services would take that into consideration when evaluating the plan. 
The factors outlined above influence the Services' determination of the 
appropriate weight that should be given to a particular conservation 
plan or agreement.
c. Private or Other Non-Federal Conservation Plans Related to Permits 
Under Section 10 of the Act
    HCPs for incidental take permits under section 10(a)(1)(B) of the 
Act provide for partnerships with non-Federal entities to minimize and 
mitigate impacts to listed species and their habitat. In some cases, 
HCP permittees agree to do more for the conservation of the species and 
their habitats on private lands than designation of critical habitat 
would provide alone. We place great value on the partnerships that are 
developed during the preparation and implementation of HCPs.
    CCAAs and SHAs are voluntary agreements designed to conserve 
candidate and listed species, respectively, on non-Federal lands. In 
exchange for actions that contribute to the conservation of species on 
non-Federal lands, participating property owners are covered by an 
``enhancement

[[Page 7230]]

of survival'' permit under section 10(a)(1)(A) of the Act, which 
authorizes incidental take of the covered species that may result from 
implementation of conservation actions, specific land uses, and, in the 
case of SHAs, the option to return to a baseline condition under the 
agreements. The Services also provide enrollees assurances that we will 
not impose further land-, water-, or resource-use restrictions, or 
require additional commitments of land, water, or finances, beyond 
those agreed to in the agreements.
    When we undertake a discretionary 4(b)(2) exclusion analysis, we 
will always consider areas covered by a permitted CCAA/SHA/HCP, and we 
anticipate consistently excluding such areas from a designation of 
critical habitat if incidental take caused by the activities in those 
areas is covered by the permit under section 10 of the Act and the 
CCAA/SHA/HCP meets all of the following conditions:
    1. The permittee is properly implementing the CCAA/SHA/HCP, and is 
expected to continue to do so for the term of the agreement. A CCAA/
SHA/HCP is properly implemented if the permittee is, and has been, 
fully implementing the commitments and provisions in the CCAA/SHA/HCP, 
Implementing Agreement, and permit.
    2. The species for which critical habitat is being designated is a 
covered species in the CCAA/SHA/HCP, or very similar in its habitat 
requirements to a covered species. The recognition that the Services 
extend to such an agreement depends on the degree to which the 
conservation measures undertaken in the CCAA/SHA/HCP would also protect 
the habitat features of the similar species.
    3. The CCAA/SHA/HCP specifically addresses the habitat of the 
species for which critical habitat is being designated and meets the 
conservation needs of the species in the planning area.
    We will undertake a case-by-case analysis to determine whether 
these conditions are met and, as with other conservation plans, whether 
the benefits of exclusion outweigh the benefits of inclusion.
    The benefits of excluding lands with CCAAs, SHAs, or properly 
implemented HCPs that have been permitted under section 10 of the Act 
include relieving landowners, communities, and counties of any 
additional regulatory burdens that might be imposed as a result of the 
critical habitat designation. A related benefit of exclusion is the 
unhindered, continued ability to maintain existing partnerships, and 
the opportunity to seek new partnerships with potential plan 
participants, including States, counties, local jurisdictions, 
conservation organizations, and private landowners. Together, these 
entities can implement conservation actions that the Services would be 
unable to accomplish without private landowners. These partnerships can 
lead to additional CCAAs, SHAs, and HCPs. This is particularly 
important because HCPs often cover a wide range of species, including 
listed plant species (for which there is no general take prohibition 
under section 9 of the Act), and species that are not State or 
federally listed (which do not receive the Act's protections). Neither 
of these categories of species are likely to be protected from 
development or other impacts in the absence of HCPs.
    As is the case with conservation plans generally, the protections 
that a CCAA, SHA, or HCP provide to habitat can reduce the benefits of 
including the covered area in the critical habitat designation. 
However, those protections may not eliminate the benefits of critical 
habitat designation. For example, because the Services generally 
approve HCPs on the basis of their efficacy at minimizing and 
mitigating negative impacts to listed species and their habitat, these 
plans generally offset those benefits of inclusion. Nonetheless, HCPs 
often allow for development of some of the covered area, and the 
associated permit provides authorization of incidental take caused by 
that development (although a properly designed HCP should steer 
development toward the least biologically important habitat). Thus, 
designation of the areas specified for development that meet the 
definition of ``critical habitat'' may still provide a conservation 
benefit to the species. In addition, if activities not covered by the 
HCP are affecting or may affect an area that is identified as critical 
habitat, then the benefits of inclusion of that specific area may be 
relatively high, because additional conservation benefits may be 
realized by the designation of critical habitat in that area. In any 
case, the Services will weigh the benefits of inclusion against the 
benefits of exclusion (usually the fostering of partnerships that may 
result in future conservation actions).
    We generally will not exclude from a designation of critical 
habitat any areas likely to be covered by CCAAs, SHAs, and HCPs that 
are still under development when we undertake a discretionary 4(b)(2) 
exclusion analysis. If a CCAA, SHA, or HCP is close to being approved, 
we will evaluate these draft plans under the framework of general plans 
and partnerships (subsection b, above). In other words, we will 
consider factors, such as partnerships that have been developed during 
the preparation of draft CCAAs, SHAs, and HCPs, and broad public 
benefits, such as encouraging the continuation of current and 
development of future conservation efforts with non-Federal partners, 
as possible benefits of exclusion. However, we will generally give 
little weight to promises of future conservation actions in draft 
CCAAs, SHAs, and HCPs; therefore, we will generally find that such 
promises will do little to reduce the benefits of inclusion in the 
discretionary 4(b)(2) exclusion analysis, even if they may directly 
benefit the species for which a critical habitat designation is 
proposed.
d. Tribal Lands
    There are several Executive Orders, Secretarial Orders, and 
policies that relate to working with Tribes. These guidance documents 
generally confirm our trust responsibilities to Tribes, recognize that 
Tribes have sovereign authority to control Tribal lands, emphasize the 
importance of developing partnerships with Tribal governments, and 
direct the Services to consult with Tribes on a government-to-
government basis.
    A joint Secretarial Order that applies to both FWS and NMFS, 
Secretarial Order 3206, American Indian Tribal Rights, Federal-Tribal 
Trust Responsibilities, and the Endangered Species Act (June 5, 1997) 
(S.O. 3206), is the most comprehensive of the various guidance 
documents related to Tribal relationships and Act implementation, and 
it provides the most detail directly relevant to the designation of 
critical habitat. In addition to the general direction discussed above, 
S.O. 3206 explicitly recognizes the right of Tribes to participate 
fully in the listing process, including designation of critical 
habitat. The Order also states: ``Critical habitat shall not be 
designated in such areas unless it is determined essential to conserve 
a listed species. In designating critical habitat, the Services shall 
evaluate and document the extent to which the conservation needs of the 
listed species can be achieved by limiting the designation to other 
lands.'' In light of this instruction, when we undertake a 
discretionary 4(b)(2) exclusion analysis, we will always consider 
exclusions of Tribal lands under section 4(b)(2) of the Act prior to 
finalizing a designation of critical habitat, and will give great 
weight to Tribal concerns in analyzing the benefits of exclusion.

[[Page 7231]]

    However, S.O. 3206 does not preclude us from designating Tribal 
lands or waters as critical habitat, nor does it state that Tribal 
lands or waters cannot meet the Act's definition of ``critical 
habitat.'' We are directed by the Act to identify areas that meet the 
definition of ``critical habitat'' (i.e., areas occupied at the time of 
listing that contain the essential physical or biological features that 
may require special management or protection and unoccupied areas that 
are essential to the conservation of a species), without regard to 
landownership. While S.O. 3206 provides important direction, it 
expressly states that it does not modify the Secretaries' statutory 
authority.
e. Impacts on National Security and Homeland Security
    Section 4(a)(3)(B)(i) of the Act (16 U.S.C. 1533(a)(3)(B)(i)), as 
revised in 2003, provides: ``The Secretary shall not designate as 
critical habitat any lands or other geographical areas owned or 
controlled by the Department of Defense (DoD), or designated for its 
use, that are subject to an integrated natural resources management 
plan [INRMP] prepared under section 101 of the Sikes Act Improvement 
Act of 1997 (Sikes Act) (16 U.S.C. 670a), if the Secretary determines 
in writing that such plan provides a benefit to the species for which 
critical habitat is proposed for designation.'' In other words, as 
articulated in the final revised regulations at 50 CFR 424.12(h), if 
the Services conclude that an INRMP ``provides a benefit'' to the 
species, the area covered is ineligible for designation and thus cannot 
be designated as critical habitat.
    Section 4(a)(3)(B)(i) of the Act, however, may not cover all DoD 
lands or areas that pose potential national-security concerns (e.g., a 
DoD installation that is in the process of revising its INRMP for a 
newly listed species or a species previously not covered). If a 
particular area is not covered under section 4(a)(3)(B)(i), national-
security or homeland-security concerns are not a factor in the process 
of determining what areas meet the definition of ``critical habitat.'' 
Nevertheless, when designating critical habitat under section 4(b)(2), 
the Secretaries must consider impacts on national security, including 
homeland security, on lands or areas not covered by section 
4(a)(3)(B)(i). Accordingly, we will always consider for exclusion from 
the designation areas for which DoD, Department of Homeland Security 
(DHS), or another Federal agency has requested exclusion based on an 
assertion of national-security or homeland-security concerns.
    We cannot, however, automatically exclude requested areas. When 
DoD, DHS, or another Federal agency requests exclusion from critical 
habitat on the basis of national-security or homeland-security impacts, 
it must provide a reasonably specific justification of an incremental 
impact on national security that would result from the designation of 
that specific area as critical habitat. That justification could 
include demonstration of probable impacts, such as impacts to ongoing 
border-security patrols and surveillance activities, or a delay in 
training or facility construction, as a result of compliance with 
section 7(a)(2) of the Act. If the agency requesting the exclusion does 
not provide us with a reasonably specific justification, we will 
contact the agency to recommend that it provide a specific 
justification or clarification of its concerns relative to the probable 
incremental impact that could result from the designation. If the 
agency provides a reasonably specific justification, we will defer to 
the expert judgment of DoD, DHS, another Federal agency as to: (1) 
Whether activities on its lands or waters, or its activities on other 
lands or waters, have national-security or homeland-security 
implications; (2) the importance of those implications; and (3) the 
degree to which the cited implications would be adversely affected in 
the absence of an exclusion. In that circumstance, in conducting a 
discretionary 4(b)(2) exclusion analysis, we will give great weight to 
national-security and homeland-security concerns in analyzing the 
benefits of exclusion.
f. Federal Lands
    We recognize that we have obligations to consider the impacts of 
designation of critical habitat on Federal lands under the first 
sentence of section 4(b)(2) and under E.O. 12866. However, as mentioned 
above, the Services have broad discretion under the second sentence of 
4(b)(2) on how to weigh those impacts. In particular, ``[t]he 
consideration and weight given to any particular impact is completely 
within the Secretary's discretion.'' (H.R. Rep. No. 95-1625, at 17 
(1978)). In considering how to exercise this broad discretion, we are 
mindful that Federal land managers have unique obligations under the 
Act. First, Congress declared its policy that ``all Federal departments 
and agencies shall seek to conserve endangered species and threatened 
species and shall utilize their authorities in furtherance of the 
purposes of this Act.'' (section 2(c)(1)). Second, all Federal agencies 
have responsibilities under section 7 of the Act to carry out programs 
for the conservation of listed species and to ensure their actions are 
not likely to jeopardize the continued existence of listed species or 
result in the destruction or adverse modification of critical habitat.
    We also note that, while the benefits of excluding non-Federal 
lands include development of new conservation partnerships, those 
benefits do not generally arise with respect to Federal lands, because 
of the independent obligations of Federal agencies under section 7 of 
the Act. Conversely, the benefits of including Federal lands in a 
designation are greater than non-Federal lands because there is a 
Federal nexus for projects on Federal lands. Thus, if a project for 
which there is discretionary Federal involvement or control is likely 
to adversely affect the critical habitat, a formal section 7 
consultation would occur and the Services would consider whether the 
project would result in the destruction or adverse modification of the 
critical habitat.
    Under the Act, the only direct consequence of critical habitat 
designation is to require Federal agencies to ensure, through section 7 
consultation, that any action they fund, authorize, or carry out does 
not destroy or adversely modify designated critical habitat. The costs 
that this requirement may impose on Federal agencies can be divided 
into two types: (1) The additional administrative or transactional 
costs associated with the consultation process with a Federal agency, 
and (2) the costs to Federal agencies and other affected parties, 
including applicants for Federal authorizations (e.g., permits, 
licenses, leases), of any project modifications necessary to avoid 
destruction or adverse modification of critical habitat. Consistent 
with the unique obligations that Congress imposed for Federal agencies 
in conserving endangered and threatened species, we generally will not 
consider avoidance of the administrative or transactional costs 
associated with the section 7 consultation process to be a ``benefit'' 
of excluding a particular area from a critical habitat designation in 
any discretionary 4(b)(2) exclusion analysis. We will, however, 
consider the extent to which such consultation would produce an outcome 
that has economic or other impacts, such as by requiring project 
modifications and additional conservation measures by the Federal 
agency or other affected parties.
    Federal lands should be prioritized as sources of support in the 
recovery of

[[Page 7232]]

listed species. To the extent possible, we will focus designation of 
critical habitat on Federal lands in an effort to avoid the real or 
perceived regulatory burdens on non-Federal lands. We do greatly value 
the partnership of other Federal agencies in the conservation of listed 
and non-listed species. However, for the reasons listed above, we will 
focus our exclusions on non-Federal lands. We are most likely to 
determine that the benefits of excluding Federal lands outweigh the 
benefits of including those lands when national-security or homeland-
security concerns are present.
g. Economic Impacts
    The first sentence of section 4(b)(2) of the Act requires the 
Services to consider the economic impacts (as well as the impacts on 
national security and any other relevant impacts) of designating 
critical habitat. In addition, economic impacts may, for some 
particular areas, play an important role in the discretionary 4(b)(2) 
exclusion analysis under the second sentence of section 4(b)(2). In 
both contexts, the Services will consider the probable incremental 
economic impacts of the designation. When the Services undertake a 
discretionary 4(b)(2) exclusion analysis with respect to a particular 
area, they will weigh the economic benefits of exclusion (and any other 
benefits of exclusion) against any benefits of inclusion (primarily the 
conservation value of designating the area). The conservation value may 
be influenced by the level of effort needed to manage degraded habitat 
to the point where it could support the listed species. The Services 
will use their discretion in determining how to weigh probable 
incremental economic impacts against conservation value. The nature of 
the probable incremental economic impacts and not necessarily a 
particular threshold level triggers considerations of exclusions based 
on probable incremental economic impacts. For example, if an economic 
analysis indicates high probable incremental impacts of designating a 
particular critical habitat unit of low conservation value (relative to 
the remainder of the designation), the Services may consider exclusion 
of that particular unit.

Summary of Comments and Recommendations

    On May 12, 2014, we published a document in the Federal Register 
(79 FR 27052) that requested written comments and information from the 
public on the draft policy regarding implementing section 4(b)(2) of 
the Act. In that document, we announced that the comment period would 
be open for 60 days, ending July 11, 2014. We received numerous 
requests to extend the comment period, and we subsequently published a 
document on June 26, 2014 (79 FR 36330), extending the comment period 
to October 9, 2014. Comments we received are grouped into general 
categories specifically relating to the draft policy.
    Comment (1): Many commenters, including federally elected 
officials, requested an extension of the public comment period 
announced in the draft policy. Additionally, we received requests to 
reopen the comment period that ended on October 9, 2014.
    Our Response: On June 26, 2014 (79 FR 36330), we extended the 
public comment period on the draft policy for an additional 90 days to 
accommodate this request and to allow for additional review and public 
comment. The comment period for the draft policy was, therefore, open 
for 150 days, which provided adequate time for all interested parties 
to submit comments and information. Additionally, the Services held 
numerous outreach initiatives that included briefings and webinars for 
elected officials, States, potentially affected Federal agencies, and 
interest groups, both environmental- and industry-focused.

Secretarial Discretion

    Comment (2): We received many comments regarding the Services' 
delegated discretion from the Secretaries. Commenters expressed concern 
that the Services' delegated discretion is too broad, the assigning of 
weight to benefits is subjective, and the proposed policy would greatly 
extend the Services' discretionary authority and allow for subjective 
disregard of voluntary State and private conservation efforts.
    Our Response: This policy does not expand or reduce Secretarial 
authority. The policy reflects only the discretion expressly provided 
for in the Act. The word ``shall'' is used to denote mandatory actions 
or outcomes, and ``may'' is used to indicate where there is discretion 
in particular matters. In the Act, the word ``may,'' as it prefaces the 
phrase ``exclude a particular area,'' thus clearly provides the 
Secretaries a choice, the ability to decide whether areas should be 
excluded based on weighing benefits of inclusion against the benefits 
of exclusion. The Secretaries may choose to exclude particular areas if 
those benefits of exclusion outweigh benefits of inclusion, unless the 
exclusion will result in the extinction of the species concerned. 
Commenters appear to be questioning the Secretary's ability to choose 
whether to enter into the discretionary weighing of benefits. Congress 
expressly provided the Secretaries discretion to decide whether to 
enter into the exclusion analysis described in the second sentence of 
section 4(b)(2). By contrast, the Secretaries do not have discretion 
when it comes to the requirement to consider the economic impact, 
impacts to national security, and any other relevant impact of 
specifying an area as critical habitat, as described in the first 
sentence of section 4(b)(2).
    Finally, this policy generally reflects the practices followed by 
the Services regarding their implementation of section 4(b)(2), and 
provides greater transparency by explaining to the public how the 
Services generally exercise the discretion granted by the Act.
    Comment (3): Some commenters suggested that the Services need to 
clarify that the Secretaries have discretion in whether to conduct an 
exclusion analysis. They stated that, while the draft policy does 
identify the discretionary nature of exclusions under 4(b)(2), language 
in other areas of the policy, such as ``we will always consider'' and 
``generally exclude,'' may cause confusion, and appear contradictory. 
Furthermore, some commenters stated that discussion of the 
discretionary 4(b)(2) exclusion analysis should clearly state that such 
analysis occurs only after the Secretary has identified an area she 
``may'' consider for exclusion, based on consideration of the economic 
impact, the impact on national security, and any other relevant impact 
(see M-Opinion at 2. Step 2, p. 17).
    Our Response: We agree with the commenter, and have made edits in 
the final policy to reflect and clarify what are requirements under the 
Act and where discretion is provided, in particular with the 
discretionary 4(b)(2) exclusion analysis.
    Comment (4): Commenters noted that the Services are required to 
consider all reasonable requests for exclusion, which is in contrast to 
the Services' position that they cannot be required to grant an 
exclusion request, and state that ``in no circumstances is exclusion 
required.'' The commenters stated that the Services' narrow view of 
section 4(b)(2) cannot be reconciled with the Act, or the history 
surrounding the 1978 amendments, and there is nothing in the statute 
that confers broad discretion. The two sentences of 4(b)(2) require the 
Services to ``consider'' economic impacts, and then to consider 
excluding a particular area from the designation of critical habitat. 
The commenters suggested that these are not separate

[[Page 7233]]

obligations, and that it is illogical for the Services to suggest that 
Congress intended to require the Services to identify the economic 
impacts without intending for the Services to apply any consideration 
of those impacts.
    Our Response: We disagree with the commenter. Section 4(b)(2) of 
the Act sets forth a mandatory consideration of impacts and a 
discretionary consideration of possible exclusions. The commenter is 
mistaken that the Act requires any particular ``action'' that must be 
taken following the consideration of impacts. The text of the Act is 
clear in the second sentence of section 4(b)(2):

    The Secretary may exclude any area from critical habitat if 
[s]he determines that the benefits of such exclusion outweigh the 
benefits of specifying such area as part of the critical habitat, 
unless [s]he determines, based on the best scientific and commercial 
data available, that the failure to designate such area as critical 
habitat will result in the extinction of the species concerned.

    Recent court decisions have resoundingly upheld the discretionary 
nature of the Secretaries' consideration of whether to exclude areas 
from critical habitat. See Bldg. Indus. Ass'n v. U.S. Dept. of 
Commerce, 792 F.3d.1027 (9th Cir. 2015), aff'g 2012 WL 6002511 (N.D. 
Cal. Nov. 30, 2012) (unreported); Bear Valley Mut. Water Co. v. Jewell, 
790 F.3d. 977 (9th Cir. 2015); Cape Hatteras Access Pres. Alliance v. 
DOI, 731 F. Supp. 2d 15, 28-30 (D.D.C. 2010). The operative word is 
``may.'' There is no requirement to exclude, or even to enter into a 
discretionary 4(b)(2) exclusion analysis for, any particular area 
identified as critical habitat. The Services do consider economic 
impacts, and apply the consideration of those probable incremental 
economic impacts in considering whether to enter into the discretionary 
4(b)(2) exclusion analysis. Based on the results of the economic 
analysis, the Services may elect not to enter into the discretionary 
4(b)(2) exclusion analysis based on economic impact alone. If they 
engage in a discretionary exclusion analysis, the Services may consider 
information from different sources (e.g., the economic analysis and 
conservation plan) in one section 4(b)(2) exclusion analysis.
    Comment (5): Numerous commenters interpreted the draft policy as a 
significant change in how the Services will consider exclusions under 
4(b)(2).
    Our Response: The Services are not changing our practice of 
considering or conducting discretionary 4(b)(2) exclusion analyses. The 
2008 Department of the Interior Solicitor's Section 4(b)(2) memorandum 
(M-37016, ``The Secretary's Authority to Exclude Areas from a Critical 
Habitat Designation under Section 4(b)(2) of the Endangered Species 
Act'' (Oct. 3, 2008)) (DOI 2008) and the regulations at 50 CFR 424.19 
provide general guidance on how to implement section 4(b)(2) of the 
Act, and form the basis for this policy. This policy generally reflects 
the practices followed by the Services, and provides greater 
transparency by explaining to the public how the Services generally 
exercise the discretion granted by the Act.

Framework for Discretionary 4(b)(2) Exclusion Analysis

    Comment (6): A commenter noted that, rather than considering 
partnership opportunities as a benefit of exclusion, the Services 
expect that benefits of an existing conservation plan will continue 
regardless of critical habitat designation and, therefore, do not 
consider an existing plan when weighing the benefits of exclusion. 
Furthermore, the Services will consider these benefits to reduce the 
benefits of inclusion. The commenter expressed concern that this 
position could serve as a disincentive for voluntary conservation. 
Furthermore, the commenter suggested that under the new policy, the 
Services will have to review for potential exclusion each plan on a 
case-by-case basis, giving the Services broader discretion than 
previously held.
    Our Response: Because we received many similar comments, we have 
added a section, General Framework for Considering an Exclusion and 
Conducting a Discretionary 4(b)(2) Exclusion Analysis, to the preamble 
of this document to clarify the way we consider and conduct exclusions. 
Furthermore, this section explains the way in which we consider 
conservation plans and partnerships when conducting a discretionary 
4(b)(2) exclusion analysis. In brief, the commenters appear to 
misunderstand how we account for the benefits of conservation plans. 
The accounting that we use (what counts as a benefit of exclusion, and 
what serves to reduce benefits of inclusion) is the only logical way of 
parsing the effects of conservation plans consistent with the statute. 
But in no way does this accounting discount the benefits of 
conservation plans--it just puts those benefits in the proper context. 
Therefore, we disagree with the commenters that our accounting will in 
any way act as a disincentive for voluntary conservation. In fact, one 
of the primary purposes of this policy is to explain the important role 
that conservation plans play in our implementation of section 4(b)(2), 
and thus, in effect, to explain the existing incentive for land 
managers to create those plans.
    The Services have reviewed and will continue to review each plan 
for potential exclusion on a case-by-case basis; we are continuing our 
existing practice, and not broadening our discretion. Adopting a policy 
that would exclude areas without an analysis and weighing of the 
benefits of inclusion and exclusion on a case-by-case basis, as the 
commenters appear to suggest, would not be consistent with the 
requirements of the Act or our implementing regulations at 50 CFR 
424.19.
    Comment (7): One commenter suggested that the policy should be 
revised to give greater detail on the processes the Services will use 
to review and exclude areas covered by existing conservation plans. 
When determining whether the benefits of exclusion outweigh the 
benefits of inclusion, the commenter noted that the Services will 
evaluate a variety of factors; however, no metrics were provided. For 
example, it is uncertain if each factor must be considered or if only 
three or four are sufficient. The commenter posed questions such as: 
will the Services give all factors equal weight or will some be deemed 
more important, and what evidence must be provided to demonstrate that 
the thresholds have been met? While the factors provide general 
direction, the commenter stated the Services provide no indication of 
how the evaluations will be conducted or what the thresholds might be. 
Finally, the commenter suggested it is unclear how the Services plan on 
evaluating whether the agreements are being properly implemented and 
how the Services will evaluate whether the permittee is expected to 
continue to properly implement the agreement.
    Our Response: The Services cannot prescribe which factors should be 
used when developing a conservation plan that does not have Federal 
involvement. The list provided in the draft policy and in this final 
policy is not exhaustive; rather, it is intended to illustrate the 
types of factors that the Services will use when evaluating such plans.
    Conservation plans that lead to the issuance of a permit under 
section 10 of the Act (including HCPs) go through a rigorous analysis 
under the Act to qualify for that permit. As discussed above, we will 
often exclude areas covered by such conservation plans. On the other 
hand, non-permitted conservation plans may not go through such 
analysis, and therefore must be more thoroughly analyzed before we

[[Page 7234]]

will consider excluding areas covered by these plans.
    The list of factors for non-permitted plans is not exclusive, not 
all factors may apply to every instance of evaluating a plan or 
partnership, and the listed factors are not requirements of plans or 
partnerships to be considered for exclusion. Criteria for non-permitted 
plans differ from criteria for permitted plans because the latter have 
already undergone rigorous analysis for the issuance of the associated 
permit and may have been measured or evaluated by additional criteria. 
For example, NEPA analysis has already been conducted before a 
permitted plan is finalized and a permit issued.
    Comment (8): Several commenters suggested that the methodology for 
exclusion should be defined, and the draft policy grants the agencies 
much more leeway to include or exclude lands from critical habitat 
designation, by requiring that each area considered for exclusion be 
reviewed on a case-by-case basis. Commenters also stated that, although 
the policy states that the benefits of designation of critical habitat 
will be weighed against the costs of such designation in a cost/benefit 
analysis, there is no clearly defined methodology included in the draft 
policy. Commenters stated that, when exercising their discretion, the 
Services should explain fully the basis, including the weighing of 
benefits, for any determination that exclusion is not warranted for any 
of the areas covered by the policy.
    Our Response: As discussed in our response to comment (2) above, 
this policy does not increase the discretion granted to the Secretaries 
by the Act. Moreover, each area considered for exclusion is unique, and 
evaluations are highly fact-specific; thus it is not possible to give a 
simple, formulaic methodology that will be used in all landscapes and 
situations. Further, it is important that the Secretaries retain 
discretion in assigning appropriate weight to benefits of inclusion and 
exclusion. Whenever the Services exclude areas under section 4(b)(2), 
they will explain the factors considered and the weighing of benefits. 
If the Services do not exclude an area that has been requested to be 
excluded through public comment, the Services will respond to this 
request. However, although the Services will explain their rationale 
for not excluding a particular area, that decision is committed to 
agency discretion. (Cape Hatteras Access Preservation Alliance v. DOI, 
731 F. Supp. 2d 15, 29-30 (D.D.C. 2010)).

Blanket or Presumptive Exclusions

    Comment (9): Many commenters suggested there is a lack of certainty 
that areas covered by permitted conservation plans will be excluded. 
Commenters stated that permitted conservation plans, including HCPs, 
SHAs, and CCAAs, provide a much greater conservation benefit to private 
land areas than other programs implemented under the Act. Many 
commenters asked that the final policy be modified to categorically 
exclude from critical habitat lands covered by permitted plans, 
provided that the plan is being properly implemented and the species is 
a covered species under the plan. Commenters noted that the 
conservation benefits from such agreements and the investment of effort 
and collaboration between the private sector and the Services should be 
acknowledged, and areas covered by conservation agreements developed 
and approved by the Services should expressly be excluded from 
designation of critical habitat. Commenters expressed concern that the 
need for a factual balancing test each time critical habitat is 
designated for a covered species poses major uncertainties for 
permittees.
    Our Response: The Services agree with the goal of providing greater 
certainty through this policy. However, each plan is different, covers 
different areas with different objectives, and will likely have 
differences in implementation and effectiveness, differences in 
duration, and so forth. Therefore, the Services must consider each plan 
on a case-by-case basis.
    As stated above, the Services do greatly value the commitments of 
private landowners and conservation partners to conserve species and 
their habitats. Even so, the Services cannot presumptively exclude 
particular areas from a designation of critical habitat. Should the 
Services enter into a discretionary 4(b)(2) exclusion analysis, the Act 
requires the Services to compare the benefits of including a particular 
area in critical habitat with the benefits of excluding the particular 
area. The Secretary may exclude an area if the benefits of exclusion 
outweigh those of inclusion, as long as the exclusion will not result 
in extinction of the species. Where they have decided to exclude an 
area, the Services must provide a reasonable consideration of factors 
on each side of the balance. The Services' draft policy and this final 
policy articulate clearly that the Services will give great weight and 
consideration to partnerships resulting from the development of HCPs, 
SHAs, and CCAAs. Additionally, the Services will give great weight to 
the conservation measures delivered on the ground by the plans 
mentioned above. The weight of the conservation measures will be 
applied to reduce the benefits of inclusion of that particular area in 
critical habitat, and in many cases the benefits of exclusion will 
outweigh the benefits of inclusion.
    However, a permitted plan and a critical habitat designation may 
further different conservation goals. A permitted plan for a covered 
species addresses certain specific activities in a discrete area. It is 
designed to mitigate or minimize impacts from specific projects. By 
contrast, we designate critical habitat to conserve a species 
throughout its range (and sometimes beyond) in light of the varying 
threats facing the species. Thus, in a discretionary 4(b)(2) exclusion 
analysis, the Services must undertake a thorough balancing analysis for 
those areas that may be excluded, and cannot presume that the fact 
pattern is the same for each specific instance of a general category of 
plans.
    Comment (10): Despite acknowledging the utility of non-permitted 
private and non-Federal conservation plans and partnerships, several 
commenters expressed the concern that the exclusion of these areas is 
not automatically guaranteed. Instead, the commenters noted that the 
Services will ``sometimes exclude specific areas'' from a critical 
habitat designation based on the existence of these plans or 
partnerships. In order to be successful, commenters stated private/non-
Federal plans must be supported by the Services and automatically 
excluded from critical habitat designations. If not, future 
conservation plans may be at risk because applicants will feel 
uncertainty regarding the utility of their efforts. Commenters 
requested the Services to codify this change and ensure that land 
protected through voluntary conservation efforts will not be subjected 
to critical habitat overlays.
    Our Response: Please see our response to the previous comment. Just 
as the Services cannot automatically guarantee exclusion of permitted 
conservation plans, we cannot presumptively exclude, or automatically 
exclude, private and non-Federal plans. When undertaking the 
discretionary 4(b)(2) exclusion analysis, the Services are obligated by 
section 4(b)(2) to weigh the benefits of inclusion and exclusion. The 
Services conduct this evaluation on a case-by-case, fact-specific 
basis. In this context, automatically excluding certain classes of 
lands or certain classes of agreements would be arbitrary.

[[Page 7235]]

    However, as noted above, the Services do highly value private and 
non-Federal conservation plans and partnerships, and our objective is 
to encourage participation in voluntary conservation planning and 
collaborative partnerships. When entering into the discretionary 
4(b)(2) exclusion analysis, the Services will consider fully the value 
and benefits of such plans and partnerships. The Services acknowledge 
that such programs and partnerships can implement conservation actions 
that the Services would be unable to accomplish without private and 
non-Federal landowners and partners.
    Comment (11): Certain States requested the addition of a policy 
element to categorically or presumptively exclude all lands managed by 
State wildlife agencies. They stated that the Services should consider 
partnerships with State wildlife agencies similarly to the way they 
consider partnerships with Native American Tribes, and exclude lands 
managed by the State as they do Tribal lands. Whether a State 
conservation plan has been vetted through the public process should not 
have any relevance to the exclusion of such lands from critical 
habitat.
    Our Response: As noted above, the Services must follow the 
direction of the Act and identify those lands meeting the definition of 
``critical habitat,'' regardless of landownership. It is only after the 
identification of lands that meet the definition of ``critical 
habitat'' that we can consider other relevant factors. It appears that 
the commenter is requesting presumptive exclusion of specific State 
lands without a case-by-case analysis. As discussed above, the Act does 
not give the Secretaries the authority to exclude areas from critical 
habitat without first undertaking a discretionary 4(b)(2) exclusion 
analysis. As we consider areas for potential exclusion, as discussed 
throughout this policy, we give great weight and consideration to 
conservation partnerships, including those partnerships with States and 
Tribes. The Services note that S.O. 3206 has no applicability to State 
governments or State lands. Even in the context in which it applies, 
S.O. 3206 does not provide a blanket exclusion or automatic exemption 
of Tribal lands.
    Comment (12): To further provide incentives for landowners or local 
and State governments to enter into conservation plans, agreements, or 
partnerships, a commenter stated the Services should, if they conduct a 
discretionary exclusion analysis, always exclude such areas from 
critical habitat designation if the benefits of exclusion outweigh the 
benefits of inclusion. The commenter stated that exclusion may 
incentivize parties to participate in future conservation plans or 
partnerships, especially the prelisting conservation measures 
encouraged by the Fish and Wildlife Service's recent draft policy 
regarding voluntary prelisting conservation actions.
    Our Response: The Services agree that recognition of partnerships 
through exclusion from critical habitat may serve to remove any real or 
perceived disincentive that a designation of critical habitat may 
produce, and encourage parties to further engage in future conservation 
planning efforts. Should the Services elect to conduct a discretionary 
4(b)(2) exclusion analysis, and if the benefits of exclusion outweigh 
the benefits of inclusion, in almost all situations we expect to 
exclude that particular area. Although the Services find it necessary 
to retain some discretion for the Secretaries because we cannot 
anticipate all fact patterns that may occur in all situations when 
considering exclusions from critical habitat, it is the general 
practice of the Services, consistent with E.O. 12866, to exercise this 
discretion to exclude an area when the benefits of exclusion outweigh 
the benefits of inclusion. However, the Secretaries may not exclude a 
particular area if the exclusion will result in the extinction of the 
species concerned. Please see the section General Framework for 
Considering an Exclusion and Conducting a Discretionary 4(b)(2) 
Exclusion Analysis, above, for more information regarding the exclusion 
process.

Plans Permitted Under Section 10 of the Act

    Comment (13): One commenter suggested that the draft policy should 
not contain a categorical rejection of an agreement with ``guidelines'' 
for habitat management. Even if the agreement provides guidelines 
relating to the species' habitat, rather than specifically addressing 
habitat, the commenter noted that if those guidelines were followed 
they may provide a greater benefit to the species than would a critical 
habitat designation. Finally the commenter noted that each plan should 
be analyzed individually for its benefit to the species; this would 
support the Services' stated policy of encouraging the development of 
section 10 agreements.
    Our Response: We agree with the commenter regarding plans with 
guidelines that, if followed, may provide a greater benefit to a 
species than would a designation of critical habitat. However, should 
the Services choose to enter into the discretionary 4(b)(2) exclusion 
analysis for a plan that only has guidelines, the Services will 
evaluate the benefits of inclusion and exclusion based on the specific 
facts of the plan in question. We have removed the language regarding 
guidelines from the final policy.
    Comment (14): One commenter stated that the Services should not 
designate or exclude mere portions of HCPs. An HCP, taken as a whole, 
is designed to meet the conservation needs of the species and is 
specifically developed to meet those needs while still allowing certain 
development impacts to occur. The commenter suggested the policy would 
allow the Services to exclude just beneficial parts of an approved HCP, 
and designate those areas that are less desirable but still an integral 
component of the HCP.
    Our Response: If the HCP has been approved and permitted, and if 
the Services undertake a discretionary 4(b)(2) exclusion analysis and 
find that the benefits of exclusion outweigh the benefits of inclusion, 
we intend to exclude the entire area covered by the HCP from the final 
designation of critical habitat for the species.
    Comment (15): One commenter stated that the Services should 
consider excluding areas covered by HCPs and SHAs that are under 
development, but not yet completed or fully implemented. The draft 
policy proposes to give very little weight to section 10 agreements 
that are in process but not formalized. The commenter expressed a 
concern that not giving weight to developing voluntary conservation 
plans could greatly reduce incentives for private landowners and other 
entities to continue these efforts. The Services should analyze in-
progress agreements individually. The agreements will vary greatly in 
scope, coverage, and the level of protections granted to the species 
and the extent of progress towards a formal agreement. If a 
comprehensive agreement is close to being formalized at the time of 
critical habitat designation, the commenter suggested there is no 
reason for the Services to designate that land as critical habitat and 
ignore the effort of the parties involved to benefit the species and 
its habitat. To ignore those efforts would discourage other landowners 
from pursuing similar plans or partnerships in the future, undermining 
future cooperation for the benefit of the species. Finally, the 
commenter suggested that the policy should be revised to give greater 
detail on the processes the Services will use to efficiently review and 
exclude areas

[[Page 7236]]

covered by conservation plans being developed.
    Our Response: Should the Services elect to undergo a discretionary 
4(b)(2) exclusion analysis of an area in which a voluntary conservation 
plan is being developed, we will consider the facts specific to the 
situation. If a draft HCP has undergone NEPA and section 7 analysis, 
the Services could evaluate that plan under the provisions of this 
policy that are applicable to conservation plans and partnerships for 
which no section 10 permit has been issued. The track record of the 
partnership and the time taken to develop the draft HCP would be 
considerations in any discretionary 4(b)(2) exclusion analysis. The 
Services would not ignore ongoing efforts to develop plans. Some of the 
factors we consider are the degree of certainty that the plan will be 
implemented, that it will continue into the future, and that it may 
provide equal or greater protection of habitat than would a critical 
habitat designation. Therefore, the Services would expect to evaluate 
draft permitted plans on a case-by-case basis, and may evaluate them 
under the non-permitted-plans-and-partnerships sections of this policy.
    Comment (16): A commenter asked the Services to clarify that not 
every conservation plan will undergo a weighing and balancing process. 
Paragraph 3 of the draft policy states: ``When we undertake a 
discretionary exclusion analysis, we will always consider areas covered 
by an approved CCAA/SHA/HCP, and generally exclude such areas from a 
designation of critical habitat if three conditions are met. . . .'' 
The commenter questioned whether the discretionary analysis is 
triggered by potential ``severe'' impacts (as described in step 2 of 
the M Opinion at p. 17: ``if [she] deems the impacts of the designation 
severe enough, [she] will proceed with an exclusion analysis under 
section 4(b)(2)'') on a particular area covered by a CCAA/SHA/HCP, or 
whether the presence of such conservation plan(s) triggers the 
discretionary analysis regardless of impacts. If the former, the 
Services should clarify that only the potentially affected conservation 
plan(s) will be subjected to the discretionary exclusion analysis. If 
the latter, the commenter expressed a concern that the result of such a 
policy is to significantly limit Secretarial discretion.
    Our Response: The Services are not limiting Secretarial discretion 
through this policy. The presence of a conservation plan or partnership 
does not mandate a discretionary 4(b)(2) exclusion analysis. If the 
Secretary decides to enter into the discretionary 4(b)(2) exclusion 
analysis, the Services may consider, among other things, whether a plan 
is permitted, or whether we receive information during a public comment 
period that we should consider a certain plan for exclusion. However, 
it is possible that the Secretaries will not conduct a discretionary 
4(b)(2) exclusion analysis for each and every conservation plan. As 
noted in the final rule revising 50 CFR 424.19, the Secretaries are 
particularly likely to conduct this discretionary analysis if the 
consideration of impacts mandated under the first sentence suggests 
that the designation will have significant incremental impacts.

Tribal Comments

    Comment (17): Numerous Tribes have asked to have their lands 
presumptively or categorically excluded from critical habitat 
designation. The commenters stated that, absent evidence that exclusion 
would lead to the extinction of the species, Tribal lands should always 
be excluded. While the Tribes appreciate the Services giving great 
weight and consideration to excluding Tribal lands, Tribes would prefer 
their lands to be categorically excluded.
    Our Response: While the Services recognize their responsibilities 
and commitments under Secretarial Order 3206 and in light of Tribal 
sovereignty, the statute is clear on the process of designating 
critical habitat, and does not allow for presumptive exclusion of any 
areas, regardless of ownership, from critical habitat without 
conducting a discretionary 4(b)(2) exclusion analysis. If we determine 
that Tribal lands meet the definition of ``critical habitat,'' the 
statute requires we identify those lands as meeting that definition. 
However, as discussed in the draft and this final policy, great weight 
and consideration will be given to Tribal partnerships and conservation 
plans if the Services enter into the discretionary 4(b)(2) exclusion 
analysis.
    Comment (18): Many commenters expressed that the designation of 
critical habitat on Tribal lands would have an unfortunate and 
substantial negative impact on the working relationships the Services 
and Tribes have established. The Services should state that, when they 
undertake a discretionary exclusion analysis, they will always consider 
exclusions of Tribal lands and not designate such areas, unless it is 
determined such areas are essential to conserve a listed species.
    Our Response: The Services recognize our trust responsibilities 
with Tribes, and value our collaborative conservation partnerships. 
Secretarial Order 3206, which provides guidance to the Departments in 
exercising their statutory authorities--but does not modify those 
authorities--states:

Critical habitat shall not be designated in such areas unless it is 
determined essential to conserve a listed species. In designating 
critical habitat, the Services shall evaluate and document the 
extent to which the conservation needs of the listed species can be 
achieved by limiting the designation to other lands.

Therefore, the Services generally will not designate critical habitat 
on Tribal lands if the conservation needs of the listed species can be 
achieved on other lands. However, if it is determined such areas are 
essential to conserve the listed species, then, as discussed in the 
previous comment response, the Services will give great weight and 
consideration to Tribal partnerships and conservation plans if the 
Services enter into the discretionary 4(b)(2) exclusion analysis.
    Comment (19): Several Tribes expressed a concern that the new 
policy will result in greater economic and social burdens on Tribes. 
Tribes bear a disproportionate burden through the consultation process 
under section 7 of the Act, as compared to State and local governments 
and private citizens, because so many basic Tribal functions are 
contingent on actions authorized, funded, or carried out by Federal 
agencies. Therefore, the commenters stated that, where Tribal lands are 
designated as critical habitat, the proposed regulations and policies 
will require an onerous, time-consuming, bureaucratic process that 
infringes on Tribal sovereignty and treaty rights and frustrates the 
ability of the Tribe to provide basic government services and achieve 
wildlife-conservation and economic-development goals.
    Our Response: While the Services recognize that a critical habitat 
designation may have real or perceived direct and indirect impacts, the 
Services are committed to assisting Tribes in conserving listed species 
and their habitats on Tribal lands, where appropriate. Where 
collaborative conservation partnerships and programs have been 
developed with Tribes, many of these real or perceived impacts have 
been ameliorated or relieved. The revised regulations and new policy 
are intended to provide clarity, transparency, and certainty regarding 
the development and designation of critical habitat, and provide for a 
more predictable and transparent critical-habitat-exclusion process. 
All three initiatives work together to provide greater clarity to the 
public and Tribes

[[Page 7237]]

as to how the Services develop and implement critical habitat 
designations.
    Comment (20): One commenter stated that, as written, the policy 
fails to acknowledge the sovereignty of Tribes and Tribal self-
governance by noting only that ``Tribal concerns'' will be considered 
in the discretionary exclusion analysis. These proposed regulations and 
policies represent a missed opportunity to effectuate the letter and 
spirit of Secretarial Orders 3206 and 3335, and to ameliorate the 
potentially harsh consequences on Tribes of the proposed regulatory 
revisions for designating critical habitat. Of even more concern, the 
Service completely ignores the fundamental disagreement concerning the 
applicability of the Endangered Species Act to Tribes.
    Our Response: Secretarial Order 3206 explicitly recognizes the 
right of Tribes to participate fully in the listing process, including 
designation of critical habitat. The Order states:

    Critical habitat shall not be designated in such areas unless it 
is determined essential to conserve a listed species. In designating 
critical habitat, the Services shall evaluate and document the 
extent to which the conservation needs of the listed species can be 
achieved by limiting the designation to other lands.

    However, S.O. 3206 does not limit the Services' authorities under 
the ESA or preclude the Services from designating Tribal lands or 
waters as critical habitat, nor does it suggest that Tribal lands or 
waters cannot meet the Act's definition of ``critical habitat.'' We are 
directed by the Act to identify areas that meet the definition of 
``critical habitat'' (i.e., occupied lands that contain the essential 
physical or biological features that may require special management 
considerations or protection and unoccupied areas that are essential to 
the conservation of a species) without regard to landownership. While 
S.O. 3206 provides important guidance, it does not relieve or supersede 
the Secretaries' statutory obligation to identify as critical habitat 
those specific areas meeting the definition of ``critical habitat'' and 
to designate such areas unless otherwise exempted by statute or 
excluded following the discretionary 4(b)(2) exclusion analysis.
    Further, following the language and intent of S.O. 3206, when we 
undertake a discretionary 4(b)(2) exclusion analysis we will always 
consider exclusions of Tribal lands prior to finalizing a designation 
of critical habitat, and will give great weight to the collaborative 
conservation partnerships the Services have with the Tribes, as well as 
Tribal conservation programs and plans that address listed species and 
their habitats. The effects of critical habitat designation on Tribal 
sovereignty and the Services' working relationship with Tribes are 
relevant impacts that the Services will generally consider in the 
context of any exclusion analysis under Section 4(b)(2). See, e.g., 
Center for Biological Diversity v. Norton, 240 F. Supp. 2d 1090, 1105 
(D. Ariz. 2003).

State Comments

    Comment (21): One commenter asked the Services to use the same 
standards for evaluating State conservation plans as those used for 
evaluating federally permitted plans for possible exclusions. The 
commenter noted that in the draft policy the Services have outlined 
different conditions for exclusion for HCPs, SHAs, and CCAAs versus all 
other conservation plans (including State plans). The former must only 
meet three conditions, while the latter are evaluated based on eight 
factors. Justification is not provided for why two different sets of 
criteria are being used. For example, HCP/SHA/CCAA plans need only be 
``properly implemented'' while other conservation plans must show not 
only implementation but also ``success of the chosen mechanism.'' No 
explanation for this difference is provided. Furthermore, the commenter 
noted that all plans should be held to the same threshold for exclusion 
consideration. States spend enormous amounts of time to craft species-
conservation plans. Finally, the commenter stated that plans are 
developed and implemented based on extensive scientific expertise 
housed in State wildlife agencies and they are crafted to meet State 
and Federal laws, rules, and regulations applicable to the protection 
of wildlife.
    Our Response: The Services recognize that considerable time and 
expertise go into creating State management plans. Any requests for 
exclusions by States will be considered, whether based on a State 
management plan or for a State wildlife area. The Services need to 
evaluate any exclusion request on a case-by-case, fact-specific basis. 
The Services recognize that not all State plans are the same, and not 
all plans are designed to meet applicable Federal laws, rules, and 
regulations. The eight factors presented in this final policy regarding 
non-permitted plans are factors the Services will consider when 
conducting a discretionary 4(b)(2) exclusion analysis evaluating a 
State conservation plan or wildlife management area for exclusion. We 
will not hold State or other non-Federal conservation plans to higher 
standards than permitted plans; the list of eight factors simply 
indicates the types of factors we will evaluate in any conservation 
plan. It should be noted that HCPs and SHAs have already been subjected 
to rigorous analyses of numerous criteria through the permitting 
process that are not expressly listed in the policy.
    Comment (22): A commenter suggested that the Services add the 
following language to the policy regarding State lands:

We recognize Congress placed high value in working with State 
partners in the conservation of threatened and endangered species 
and we will give great weight to the recommendations from our State 
partners when evaluating critical habitat on State lands. Many 
States have land holdings that cross a broad spectrum of uses that 
can range from lands primarily managed for conservation purposes 
while other lands are owned to provide maximum economic return as in 
the case of some State school lands. The Service, in weighing the 
benefits of inclusion versus exclusion of State lands, will conduct 
a discretionary analysis if the State indicates a wish to be 
excluded from a critical habitat designation and provides a detailed 
assessment on the merits of their requested exclusion. The Service 
is not under obligation to exclude those State lands but will use 
the State's assessment as we weigh the expected gain in conservation 
value for inclusion of a tract of State land in a final critical 
habitat designation.
    Our Response: As stated above, the Services decline to add a 
specific policy element suggesting that we would give great weight to 
recommendations of our State partners when evaluating critical habitat 
on State lands. The Services agree with the commenter's premise that 
conservation of endangered and threatened species cannot be done 
without cooperation of State partners. We also agree that we generally 
will consider exclusions of State lands if requested by States; 
however, we are under no obligation to exclude such lands, even where 
requested.

Comments Regarding Federal Lands

    Comment (23): One commenter stated that the Services should not 
``focus'' designation of critical habitat on Federal lands, nor assume 
that the benefits of critical habitat designations on Federal lands 
``are typically greater'' than the benefits of excluding these areas.
    Our Response: When designating critical habitat, the Services 
follow the Act and implementing regulations to develop a designation 
based solely on the best scientific data available, and that identifies 
physical or biological features essential to the conservation of a 
species or areas that are essential for the conservation of a species. 
This initial identification of eligible areas

[[Page 7238]]

that meet the definition of ``critical habitat'' is conducted without 
regard to landownership or the identity of land managers. Before 
finalizing a designation of critical habitat, the Services must 
consider economic impacts, the impact on national security, and any 
other relevant impact of designating critical habitat. It is following 
this consideration of potential impacts that the Secretary may then 
exclude particular areas from critical habitat, but only if the 
exclusion will not result in the extinction of the species.
    The Services look to the Congressional intent of the Act--in 
particular, section 2(c) states that all Federal agencies shall seek to 
conserve listed species and their habitats. Additionally, section 
7(a)(2) of the Act requires Federal agencies that fund, authorize, or 
carry out projects to ensure their actions are not likely to destroy or 
adversely modify critical habitat. The commenter does not explain why 
the Services should not focus, to the extent practicable and allowed by 
the Act, on designation of critical habitat on Federal lands. Also, the 
commenter does not provide an explanation to support its view that the 
benefits of including Federal lands in a designation of critical 
habitat are not typically greater than including other areas. In fact, 
because Federal agencies are required to ensure that their actions are 
not likely to destroy or adversely modify critical habitat, the 
benefits of including Federal lands are typically greater than the 
benefits of including other areas.
    Comment (24): Another commenter asked the Services to consider 
excluding Federal lands that are subject to special management by land-
management agencies. Congress has mandated that Federal lands, such as 
lands managed by the Bureau of Land Management (BLM) and the U.S. 
Forest Service, be available for multiple uses. The commenter stated 
the Services' designation of critical habitat primarily on Federal 
lands upsets the balance struck in land-management decisions made by 
the agencies charged with administering Federal lands and, moreover, 
interferes with the directives established by Congress.
    Our Response: Complying with the Act does not interfere with other 
Federal agency mandates. The Act is one of many Federal mandates with 
which all Federal agencies must comply, and Federal agencies must use 
available discretion to take into account the needs of listed species 
when implementing their other duties. The Services are also required to 
comply with the Act as they manage their lands, monuments, trust 
resources, and sanctuaries for multiple purposes. It has been the 
experience of the Services that listing or designating critical habitat 
for species does not drastically alter existing management schemes of 
other Federal agencies. In those instances where conflicts arise, the 
Services have successfully worked with the affected Federal agency to 
reduce conflicts with its mission. The Services are committed to 
continuing the collaborative relationships with other Federal agencies 
to further conservation of species and their habitats.
    Comment (25): One commenter stated that a reasonable exclusion 
policy should allow the Services to recognize and consider exclusions 
for all types of conservation projects, whether they occur on Federal 
or non[hyphen]Federal lands. The commenter understands the Services' 
intent to reduce regulatory burdens on private lands. However, the 
commenter opposes a policy that would disqualify exclusions on Federal 
lands, while prioritizing them for recovery. The commenter strongly 
stated that exclusions should be based on the criteria outlined in 
section 4(b)(2) of the Act, whether the land is Federal or 
non[hyphen]Federal. Section 4(b)(2) of the Act provides the Secretary 
the discretion to ``exclude any area from critical habitat if [s]he 
determines that the benefits of exclusion outweigh the benefits of 
specifying such area as part of the critical habitat,'' but does not 
delineate whether landownership should play a factor in the decision to 
exclude lands from designation.
    Our Response: To the extent that the commenter is suggesting that 
discretionary 4(b)(2) exclusion analyses are done on a case-by-case 
basis and are highly fact-specific, we agree. This policy does not 
preclude exclusions of Federal lands; in fact, the Services have 
excluded particular Federal lands in the recent past. However, the 
Services maintain their policy position that Federal lands will 
typically have greater benefits of inclusion compared to the benefits 
of exclusion. This position is consistent with the purposes of the Act 
as outlined in section 2. Section 2(c)(1) states:

It is further declared to be the policy of Congress that all Federal 
departments and agencies shall seek to conserve endangered species 
and threatened species and shall utilize their authorities in 
furtherance of the purposes of this Act.

    Additionally, section 7(a)(1) restates this responsibility and 
specifically requires all Federal agencies to consult with the Services 
to carry out programs for conservation of endangered and threatened 
species. Because the section 7 consultation requirements apply to 
projects carried out on Federal lands where there is discretionary 
Federal involvement or control, designation of critical habitat on 
Federal lands is more likely to benefit species than designation of 
critical habitat on private lands without a Federal nexus.
    Comment (26): A commenter suggested that the Services should create 
an incentive for Federal land managers. The Services could consider a 
similar approach to Federal land exclusions that are provided for 
Department of Defense installations. Applying this same standard to all 
Federal lands, the commenter stated, would create a stronger incentive 
for more agencies to live up to the requirements of section 7(a)(1) of 
the Act.
    Our Response: Congress intended for Federal agencies to participate 
in the conservation of endangered and threatened species. As discussed 
above, section 2(c)(1) of the Act clearly states this responsibility. 
Additionally, section 7(a)(1) restates this responsibility and 
specifically requires all Federal agencies to consult with the Services 
to carry out programs for conservation of endangered and threatened 
species. Section 7(a)(2) of the Act requires Federal agencies to 
consult with the Services to ``insure that any action authorized, 
funded, or carried out by such agency . . . is not likely to jeopardize 
the continued existence of any endangered species or threatened species 
or result in the destruction or adverse modification of [critical] 
habitat of such species.''
    Exemption of Department of Defense lands from critical habitat is 
mandated under section 4(a)(3)(B)(i) of the Act, and is thus entirely 
different from discretionary exclusions of particular lands from a 
designation of critical habitat under section 4(b)(2). Exemption of an 
area covered under an INRMP under the Sikes Act is based on the 
statutory condition that the Secretary has determined the plan provides 
a benefit to a species, whereas an exclusion of a particular area is 
based on the discretionary 4(b)(2) weighing of the benefits of 
inclusion and exclusion.

Comments on Economics

    Comment (27): A commenter asked the Services to provide details of 
how costs and benefits are evaluated. The draft policy does not clearly 
define how benefits and costs will be determined, giving the Services a 
great deal of discretion. The commenter noted that the draft policy 
does not adequately explain how the consideration of

[[Page 7239]]

economic impacts will be applied during the exclusion process. The 
phrase ``nature of those impacts'' in the draft policy fails to provide 
a description that will give adequate notice of what will actually be 
considered.
    Our Response: The policy is not intended to present a detailed 
treatment of economic impact analysis methodology. The Summary of 
Comments and Recommendations section of the Service's final rule 
regarding revisions to the regulations for impact analyses of critical 
habitat, which was published on August 28, 2013 (78 FR 53058), contains 
a discussion of cost and benefit analysis of critical habitat 
designations.
    To aid in the consideration of probable incremental economic 
impacts under section 4(b)(2) of the Act, the Services conduct an 
economic analysis of the designation of critical habitat, which 
satisfies the mandatory consideration of economic impacts. Should the 
Secretaries consider excluding a particular area from critical habitat, 
the economic analysis is one tool the Secretaries may use to inform 
their decision whether to exclude the particular area.
    The commenter points out that the phrase ``nature of those 
impacts'' is not defined. The Services intentionally did not define 
this phrase, because it has been the experience of the Services that 
economic impacts of critical habitat designations vary widely, making 
it infeasible to quantify the level of impacts that would trigger 
further consideration in all cases.
    Comment (28): Because the Services use an incremental approach to 
estimating economic impacts, one commenter suggested that the economic 
impacts of critical habitat are vastly underestimated. The commenter 
suggested the Services should conduct an economic analysis that 
evaluates the cumulative and co-extensive costs of critical habitat. 
Focusing on incremental economic impacts does not provide an accurate 
picture, as it discounts the full financial implications of a listing 
for landowners, businesses, and communities. The commenter expressed 
the opinion that the incremental approach effectively shifts the 
economic costs of critical habitat designations to the listing process 
under the Act where the Service is prohibited from considering costs. 
Ultimately, because this approach will result in fewer costs being 
attributed to critical habitat designation, it will greatly reduce the 
usefulness of the 4(b)(2) process.
    Our Response: We disagree. Our final rule amending 50 CFR 424.19, 
published August 28, 2013 (78 FR 53058), codified the use of the 
incremental method for conducting impact analyses, including economic 
analyses, for critical habitat designations. That final rule contains 
responses to public comments that clearly lay out the Services' 
rationale for using the incremental method. Please refer to that rule 
for more information. Evaluating incremental impacts that result from a 
regulation being promulgated, rather than considering coextensive 
impacts that may be ascribed to various previous regulations, is 
further supported by Executive Order 12866, as applied by OMB Circular 
A-4.
    Comment (29): Congress expressly required the Secretaries to 
consider economic impacts when they designate critical habitat (16 
U.S.C. 1533(b)(2)). A commenter stated the Services have interpreted 
this requirement to limit their use of the economic analysis to the 
exclusion process. The commenter further noted that the draft policy 
restricts discussions of the economic impacts from critical habitat 
designation to determinations of whether an area will be excluded from 
a critical habitat designation. Economic concerns are arguably the most 
important consideration for those being regulated. The commenter 
expressed the opinion that the designation of critical habitat has 
economic impacts on States, counties, local governments, and 
landowners. These impacts include increased regulatory burdens that 
delay projects. The commenter stated it is important that the Services 
recognize the economic impacts of critical habitat designation and 
consider those impacts throughout the designation process, as required 
by Congress under the Endangered Species Act. The commenter asked that 
the draft policy be amended to emphasize use of economic impacts 
analyses in each stage of the designation process, not just exclusion 
of an area from a critical habitat designation.
    Our Response: We agree that the mandatory consideration of 
economics is an important step in the designation of critical habitat. 
However, we disagree that economic impact analyses should be used at 
each step of the designation process. The process of developing a 
designation is based on the best available scientific information, and 
consists of a determination of what is needed for species conservation. 
Congress expressly prohibited the Secretaries from using anything other 
than the best available scientific information in identifying areas 
that meet the definition of ``critical habitat.'' However, Congress 
expressly required the Secretaries to consider economic impacts, 
national-security impacts, and other relevant impacts before finalizing 
the critical habitat designation.
    The Services prepare an economic analysis of each proposed 
designation of critical habitat and may use that information in 
discretionary 4(b)(2) exclusion analyses. Our final rule that amended 
our implementing regulations at 50 CFR 424.19, which was published on 
August 28, 2013 (78 FR 53058), contains more information regarding 
impact analyses, including economics. This final policy is focused on 
the discretionary process of excluding areas under section 4(b)(2).
    Comment (30): A commenter stated that the economic impact of 
critical habitat designations on the exercise of rights to Federal 
lands is significant and should not be discounted. In the preamble to 
the draft policy, the Services state that they ``generally will not 
consider avoiding the administrative or transactional costs associated 
with the section 7 consultation process to be a `benefit' of excluding 
a particular area from a critical habitat designation in any 
discretionary exclusion analysis.'' The commenter suggested this 
statement ignores that administrative and transactional costs of 
critical habitat designations can be significant, particularly when 
critical habitat will cover a large area. The commenter stated that 
Federal agencies are not the only entities that must absorb the costs 
of section 7 consultation. Administrative and transactional costs are 
also borne by non-Federal parties, such as applicants for permits or 
licenses. The commenter further noted that, if the exclusion analysis 
is limited to non-Federal lands, where section 7 consultation is often 
not triggered, the economic benefits of exclusion will rarely be 
considered. For proponents of large projects on Federal lands, these 
economic benefits of exclusion can be significant.
    Our Response: We agree with the commenter that the Services should 
consider the indirect effects resulting from a designation of critical 
habitat. In fact, the Services are required to evaluate the direct and 
indirect costs of the designation of critical habitat under the 
provisions of Executive Order 12866, and we do so through the economic 
analyses of the designation of critical habitat. However, as noted 
previously, we do not consider avoidance of transactional costs 
associated with section 7 consultation to be a benefit of exclusion. 
Rather, those costs represent the inherent consequence of Congress' 
decision to

[[Page 7240]]

require Federal agencies to avoid destruction or adverse modification. 
Please refer to the Summary of Comments and Recommendations section of 
the final rule amending 50 CFR 424.19 (78 FR 53058, August 28, 2013), 
particularly our response to Comment 44, for more information regarding 
direct and indirect costs.
    Comment (31): One commenter suggested that the Services should also 
consider potential economic benefits of inclusion. Economic benefits of 
designating critical habitat include a potentially faster rate of 
recovery for the species, which could result in less long-term costs 
for the agency and partners.
    Our Response: The Act requires a mandatory consideration of the 
economic impact of designating a specific area as critical habitat. The 
Services interpret this statement to be inclusive of benefits and costs 
that result from the designation of critical habitat. This 
interpretation is further supported by Executive Order 12866 as 
clarified in OMB Circular A-4. The Services do consider non-consumptive 
use benefits, such as hiking, increased tourism, or appreciation of 
protected open or green areas, in a qualitative manner where credible 
data are available. Further, in rare circumstances, when independent 
and credible research can be conducted on the benefits for a particular 
species, that information is used. However, for most species, credible 
studies and data related to potential economic benefits of designating 
their habitat as critical habitat are not available or quantifiable.
    Comment (32): One commenter expressed the opinion that listing 
decisions under the Act have real economic impacts for State and local 
governments, through restriction on rangeland grazing, hunting, 
tourism, and development of resources on public and private lands. It 
may well be that, in some circumstances, the economic benefits of 
exclusion outweigh the conservation benefits of inclusion. The 
commenter suggested that such situations should be recognized by the 
Services and granted exclusion in order to provide maximum flexibility 
for a balanced mix of conservation and economic activities.
    Our Response: The Services recognize that the listing of species 
may result in an economic impact; however, the Act does not allow the 
consideration of potential economic impacts when listing a species. The 
Act expressly limits the basis of our determination of the status of a 
species to the best scientific and commercial information available. 
The Services also cannot consider the potential economic impact of 
listing a species in an exclusion analysis under section 4(b)(2) of the 
Act. This consideration of economics in the discretionary 4(b)(2) 
exclusion analysis is to be based on the incremental impacts that 
result solely from the designation of critical habitat, and not those 
impacts that may result from the listing of the species. 50 CFR 424.19.
    We assume the commenter is referring to considerations of economics 
prior to finalizing a designation of critical habitat. The Services 
always consider potential economic impacts that may result from the 
designation of critical habitat. The purpose of the second sentence of 
section 4(b)(2) is to authorize the Secretaries to exclude particular 
areas from a designation if the benefits of exclusion outweigh the 
benefits of inclusion. The Services recognize that there may be 
circumstances when the economic benefits of exclusion (together with 
any other benefits of exclusion) do in fact outweigh the conservation 
benefits of inclusion (together with any other benefits of inclusion). 
In that case, the Services may decide to exclude the particular area at 
issue (unless exclusion will result in extinction of the species). The 
Services will evaluate the best available scientific information when 
undertaking a discretionary 4(b)(2) exclusion analysis.
    Comment (33): A commenter noted that the Services should consider 
financial commitments made in HCPs, SHAs, and CCAAs. Proponents could 
commit serious finances only to have the area later designated as 
critical habitat.
    Our Response: The Services do not consider the financial 
commitments made in HCPs, SHAs, or CCAAs, as a standalone factor when 
evaluating areas for exclusion. The Services, however, do consider the 
conservation benefits associated with financial commitments of a plan 
to reduce the benefits of including a particular area in critical 
habitat. The fostering and maintenance of conservation partnerships can 
be a benefit of exclusion, and can serve as an incentive to future 
financial commitments to further conservation. The Services greatly 
value the on-the-ground conservation delivered by these partnerships 
and their associated permitted plans.

Comments on National Security

    Comment (34): A commenter asked the Services to clarify how 
national-security concerns will be considered. The commenter stated 
that the Services say they will give ``great weight'' to these 
concerns, but this phrase is a subjective term and could use additional 
clarity. The use of the phrase implies national-security concerns will 
always outweigh the benefits of inclusion. The commenter recommends 
expanding or altering this phrase to better clarify how national-
security concerns will be considered.
    Our Response: The Services do not consider the phrase ``great 
weight'' to imply a predetermined exclusion based on national-security 
concerns, as the commenter is suggesting. The Services always consider 
for exclusion from the designation areas for which DoD, DHS, or another 
Federal agency has requested exclusion based on an assertion of 
national-security or homeland-security concerns. The agency requesting 
such exclusion must provide a reasonably specific rationale for such 
exclusion. The Service will weigh heavily those concerns regarding the 
probable incremental impact to national security as a result of 
designating critical habitat. This does not mean the Services will then 
in turn give little weight to any benefits of inclusion. It is not the 
Services' intent to predetermine the outcome of a discretionary 4(b)(2) 
exclusion analysis.

General Comments

    Comment (35): One commenter asked for an explanation of how the two 
proposed critical habitat rules and draft policy will work together, 
discussing the challenges and benefits they provide together. E.O. 
13563 states that regulations ``must promote predictability and reduce 
uncertainty.''
    Our Response: The regulations and policy are intended to provide 
clarity, transparency, and certainty regarding the development and 
implementation of critical habitat, and provide for a more predictable 
and transparent process for designating critical habitat. All three 
initiatives work together to provide greater clarity to the public as 
to how the Services develop and implement critical habitat 
designations. The rule amending 50 CFR part 424 provides new 
definitions and clarifications that will inform the process of 
designating critical habitat. The rule revising the definition of 
``destruction or adverse modification'' (at 50 CFR 402.02) redefines 
that term and clarifies its role in section 7 consultations. This 
policy focuses on how the Services implement section 4(b)(2) of the 
Act, with regard to excluding areas from critical habitat designations.
    Comment (36): The draft policy states that it will be prospective 
only and will not apply to any ``previously completed'' critical 
habitat designations. One commenter stated the policy should more 
clearly state that the revised

[[Page 7241]]

language will not be used in reassessing or reassigning critical 
habitat; only future designations of critical habitat will fall under 
the new policy.
    Our Response: The commenter is correct that this final policy does 
not apply to designations of critical habitat finalized prior to the 
effective date of this policy (see DATES, above). This policy applies 
to future designations of critical habitat that are completed after the 
effective date of this policy. If the Services choose to revise 
previous designations, the Services will use the operative regulations 
and policies in place at the time of such revision. Of course, as we 
have indicated elsewhere, this policy does not establish binding 
standards that mandate particular outcomes.
    Comment (37): We received many comments that the policy proposed 
changes that were arbitrary and without merit, because they will 
deprive private property owners and States of incentives and tools to 
conserve species and their habitat.
    Our Response: The Services have developed, and continue to develop, 
considerable tools to assist landowners in the conservation of species 
and their habitats. Nothing in this policy takes away from those tools 
and reliance on, and recognition of, collaborative conservation 
partnerships. Rather, the Services believe the elements of this policy 
provide greater clarity and certainty on how those conservation tools 
are regarded and evaluated when considering designations of critical 
habitat. Additionally, the Services' goal is to remove any real or 
perceived disincentive for voluntary conservation plans and 
collaborative partnerships, whether permitted under section 10 of the 
Act or developed outside of those provisions.
    Comment (38): A commenter stated that monitoring and adaptive 
management of conservation plans should not be used as standards for 
determining exclusions. The commenter noted that critical habitat 
designations do not have this standard, which elevates the exclusionary 
determination above that which the Services use in their critical 
habitat designations.
    Our Response: In order to exclude an area from critical habitat, 
the benefits of exclusion must outweigh those of inclusion, and the 
exclusion must not result in the extinction of the species. As the 
commenter correctly notes, adaptive management and monitoring are not a 
prescribed part of critical habitat designations and implementation. 
However, monitoring the implementation of conservation actions is 
essential to determine effectiveness of such actions, and using 
adaptive management is critical to the long-term success of 
conservation plans. Therefore, these factors are important 
considerations in evaluating the degree to which the existence of the 
conservation plan reduces the benefits of inclusion of an area in 
critical habitat.
    Comment (39): A commenter stated that in the list of eight factors 
the Services say they will consider when evaluating lands for exclusion 
based on non-permitted conservation plans, the Services should clarify 
what they mean by, ``The degree to which there has been agency review 
and required determinations.'' The commenter asked which agencies would 
review the conservation plan, agreement, or partnership--the Services, 
other Federal agencies, or State or local agencies? What determinations 
are ``required determinations?''
    Our Response: Should the Services choose to enter into the 
discretionary 4(b)(2) exclusion analysis, we would evaluate any 
information supplied by the requester for exclusion, including whether 
the plan has complied with applicable local, State, and Federal 
requirements, and any determinations required therein. For example, a 
county-level ordinance requiring habitat set-asides for development may 
require State environmental review and public scoping. This type of 
required review or determination would be taken into consideration when 
evaluating particular areas for exclusion. The Services are not 
prescribing any suite of required determinations. The burden is on the 
requester to provide relevant information pertaining to review of the 
plan by any agency. This is important information that will be used in 
our evaluation of the effectiveness of a conservation plan in the 
discretionary 4(b)(2) exclusion analysis.
    Comment (40): One commenter disagreed with the Services' proposal 
to consider whether a permittee ``is expected to continue to [properly 
implement the conservation agreement] for the term of the agreement.'' 
The commenter stated the Services should rely on their authority to 
revoke permits and revise critical habitat rather than speculating 
about future implementation of conservation agreements. Accordingly, 
the commenter requests that the Services remove the phrase ``and is 
expected to continue to do so for the term of the agreement'' from the 
first condition related to the exclusion of conservation plans related 
to section 10 permits.
    Our Response: The Services need to evaluate whether there is 
reasonable certainty of implementation and completion of conservation 
plans. Permittees are expected to fulfill the provisions of their 
permits for the agreed-upon time period. However, given the voluntary 
nature of agreements, it is possible, even in permitted plans, that 
permittees may not implement the plan as conditioned or may cancel an 
agreement at any time. Therefore, certainty of the continuance of any 
conservation plan is an important consideration.
    Comment (41): One commenter stated that the Services should 
emphasize the benefits of critical habitat and expressed disappointment 
that the Services' draft policy attempts to minimize the actual 
benefits that derive from critical habitat with an extremely cursory 
description of critical habitat's benefits at the beginning of the 
preamble to the draft policy.
    Our Response: The Services in no way intend to understate the 
important functions of critical habitat. We recognize that the primary 
threat faced by most endangered and threatened species has been, and 
continues to be, loss and fragmentation of suitable habitat. Critical 
habitat designation is one conservation tool in the Act that attempts 
to address this situation, by identifying habitat features and areas 
essential to the conservation of the species. It provides educational 
benefits by bringing these important areas to the public's and 
landowners' attention, and requires consultation with the Services for 
proposed activities by Federal agencies, on Federal lands, or involving 
a Federal nexus, to ensure that such activities are not likely to cause 
the destruction or adverse modification of the critical habitat. These 
benefits are considered by the Services on a case-by-case basis in the 
context of the discretionary consideration of exclusions under Section 
4(b)(2).
    Comment (42): A commenter stated that the Services should clarify 
that this policy provides broad program guidance, not specific 
prescriptions of exclusion analysis and designation. It does not 
concern a specific action concerning a specific property. Also, the 
commenter stated the Services should point out that the 4(b)(2) policy 
could be used to avoid a Fifth Amendment taking if extensive property 
restrictions would occur due to critical habitat designation.
    Our Response: We agree that the purpose of this policy is to 
provide guidance and clarity as to how the Services consider exclusions 
under section 4(b)(2) of the Act, rather than formulaic prescriptions 
as to how exclusion analyses are performed. As noted above, each area 
considered for exclusion from a particular critical

[[Page 7242]]

habitat designation is unique, and the factors considered in such 
evaluation are fact-specific. Thus, there is no simple, one-size-fits-
all approach; rather, the Services take a case-by-case approach in 
considering the factors in a weighing and balancing analysis, and the 
relative importance (or weight) of each of those factors.
    The Services do not consider the designation of critical habitat to 
impose property restrictions such that a Fifth Amendment taking issue 
would arise.
    Comment (43): One commenter noted that the Services should clarify 
that exclusion of private lands from critical habitat designation is 
not a ``reward.'' The commenter stated the draft policy may be 
perceived as contradictory to key messaging being promoted through 
outreach efforts to landowners and that the Services' outreach 
messaging has been that critical habitat designation does not affect 
private landowners, unless their activity is authorized, funded, or 
carried out by a Federal agency. The commenter's opinion is that the 
draft policy, however, appears to ``reward'' landowners by excluding 
their land from critical habitat if their land is covered by a 
conservation plan.
    Our Response: We agree in part with the commenter. It is true that 
critical habitat does not create a regulatory impact on private lands 
where there is no Federal nexus, and that even when there is a Federal 
nexus, the potential impact of a designation of critical habitat 
sometimes is minimal. Nevertheless, the Services are keenly aware of 
the significant concerns that some landowners have about critical 
habitat. We also recognize that landowners invest time and money for 
proactive conservation plans on their lands. The Services do not 
exclude particular areas from a designation of critical habitat as a 
reward to landowners for conservation actions they undertake. Rather, 
the existence of a conservation plan; effective, implemented 
conservation actions; and a demonstrated partnership are relevant 
factors that should be considered in any discretionary 4(b)(2) 
analysis. If the Services find the benefits of exclusion outweigh 
inclusion based on the specific facts, the particular area covered by 
the conservation plan may be excluded, provided the exclusion will not 
result in the extinction of the species.
    Comment (44): A commenter asked the Services to define 
``partnerships'' and how they will be evaluated.
    Our Response: Partnerships come in many forms. Some partnerships 
have a long-standing track record of the partners working together for 
the conservation of species and their habitat, some partnerships are 
newly formed, and others are generally anticipated to occur in the 
future. We greatly appreciate and value these conservation 
partnerships, and will consider the specifics of what each partnership 
contributes to the conservation of the species when conducting 
discretionary 4(b)(2) exclusion analyses. We will also consider the 
general benefits that excluding areas will have on encouraging future 
partnerships. Because the specifics and context of partnerships vary so 
much, we conclude that it would not be useful to attempt to expressly 
define ``partnerships,'' or to set out uniform guidance as to how they 
will be evaluated.
    Comment (45): One commenter stated that the length of a 
conservation plan and the certainty it will continue to be implemented 
should be added to the criteria used to evaluate HCPs, SHAs, and CCAAs. 
None of the conditions account for the temporary nature of these 
agreements, nor is this aspect discussed elsewhere in the draft policy 
or preamble. A commenter recommended adding a fourth condition to 
address the expected longevity of the CCAA/SHA/HCP.
    Our Response: We have already captured this in the first condition 
we evaluate, which states: ``The permittee is properly implementing the 
CCAA/SHA/HCP and is expected to continue to do so for the term of the 
agreement. A CCAA/SHA/HCP is properly implemented if the permittee is 
and has been fully implementing the commitments and provisions in the 
CCAA/SHA/HCP, Implementing Agreement, and permit.'' We have determined 
not to be more prescriptive than this, because we need to retain 
flexibility in our evaluations. We may use the track record of 
partnership in our discretionary 4(b)(2) exclusion analysis, which may 
include the length of the permitted plan. For example, some plans have 
long-term implementation schedules in which additional conservation 
measures are developed or phased in over time, so it would not be 
appropriate to expect all measures will be put into place immediately. 
The Services expect that plans will be fully implemented regardless of 
their term of agreement or operation. When issuing permits, the 
Services considera whether the term of any such plan is sufficient to 
produce meaningful conservation benefits to the species. Therefore, it 
is not necessary in all cases to evaluate the term of a permit as a 
condition for exclusion from critical habitat. However, the Services 
have retained their flexibility to evaluate plans on a case-by-case 
basis, and may consider the term of the plan if appropriate.

Comments Regarding Transportation Infrastructure

    Comment (46): A commenter requested that the Services exclude 
transportation infrastructure from critical habitat designations. The 
commenter suggested that a new paragraph or policy element be added. 
The paragraph would state the Services will always consider in their 
discretionary exclusion analysis that dedicated transportation 
infrastructure and rights-of-way (ROWs) be excluded from critical 
habitat, given that transportation lands are managed primarily for the 
use and safety of the travelling public and usually have very little 
conservation value for listed species.
    Our Response: The Services recognize the importance of maintaining 
transportation infrastructure and ROWs for the safe conveyance of 
people and goods. However, the Services do not agree that creating a 
dedicated policy element giving great weight and consideration to 
exclusion of transportation infrastructure and ROWs is necessary. Some 
areas seemingly included within the overall boundaries of critical 
habitat designations consist of manmade structures and impervious 
surfaces that do not contain the features essential to the conservation 
of a species. This occurs because of the scale and resolution of the 
maps used to depict critical habitat. To remedy this, all regulations 
designating critical habitat contain language stating that manmade 
structures (such as buildings, aqueducts, runways, roads, and other 
paved areas) and the land on which they are located are not included in 
critical habitat. Therefore, a Federal action involving these lands 
will not trigger section 7 consultation with respect to the requirement 
that the Federal agency insure that the action is not likely to 
adversely modify critical habitat, unless the specific action would 
affect the physical or biological features in the adjacent critical 
habitat.
    Portions of ROWs may not contain manmade structures, and may be 
included in areas that otherwise meet the definition of ``critical 
habitat.'' In some cases, the footprint of ROWs themselves may not have 
the features essential to the conservation of the species at issue. In 
this case, should the Services engage in a discretionary 4(b)(2) 
exclusion analysis, the Services may determine that that there is 
little or no benefit of inclusion, and that the

[[Page 7243]]

benefits of exclusion outweigh the benefits of inclusion, and, 
therefore, decide to exclude the ROWs from the designation.
    Comment (47): The designation of critical habitat on an airport may 
serve to attract wildlife to the airport environment. The Federal 
Aviation Administration (FAA) requests that an element be added to the 
policy that would convey great weight and consideration to excluding 
aircraft-movement areas, runway and taxi areas, object-free areas, and 
runway-protection zones from designations of critical habitat. 
Designation of critical habitat could also impair the airport owner's 
ability to expand facilities, and thus have economic costs. FAA 
requests that safety be a specific consideration in any exclusion 
analysis.
    Our Response: The Services disagree that a dedicated policy element 
is needed in this particular instance. When identifying areas that meet 
the definition of ``critical habitat,'' the Act does not authorize the 
Services to consider landownership. It is a process that relies on the 
best scientific data available to determine the specific occupied areas 
containing features essential to the conservation of a species that may 
require special management considerations or protection and unoccupied 
areas that may be essential for the conservation of the species. Active 
airport areas that do not meet the definition of ``critical habitat'' 
(i.e., occupied areas that do not contain the features essential to the 
conservation of a particular species that may require special 
management considerations or protection or unoccupied areas that are 
not essential for the conservation of the species) will not be 
designated critical habitat. As mentioned above, manmade structures 
(such as buildings, aqueducts, runways, roads, and other paved areas) 
and the land on which they are located are generally not included in 
critical habitat. Therefore, a Federal action involving these lands 
will not trigger section 7 consultation with respect to the requirement 
that the Federal agency insure that the action is not likely to destroy 
or adversely modify critical habitat, unless the specific action would 
affect the physical or biological features in the adjacent critical 
habitat.
    In some particular instances, the Services may identify areas 
within airport boundaries that meet the definition of ``critical 
habitat'' as applied to a particular species. In these instances, the 
Services generally would consider any request for exclusion from the 
designation received from airport managers or FAA under the general 
authority of section 4(b)(2) or applicable elements of this policy, 
e.g., the non-permitted plans and partnerships provision of this 
policy. In addition, the Services encourage airport managers to 
consider developing HCPs that would address incidental take of listed 
species and conservation of their habitat.

Comments on NEPA Requirements

    Comment (48): The Services have determined that a categorical 
exclusion (CE) from the NEPA requirements applies to the draft policy. 
CEs address categories of actions that do not individually or 
cumulatively have a significant effect on the human environment. The 
commenter stated that a CE is not appropriate for NEPA compliance on 
issuance of this draft policy, given the potential expansion in future 
critical habitat designations and the significant effect on 
environmental and economic resources in areas to be designated as a 
result of these initiatives.
    The commenter asserted that the Services' proposed actions 
constitute a ``major federal action significantly affecting the quality 
of the human environment'' (42 U.S.C. part 4321, et seq.). Furthermore, 
the commenter noted, the Services are required to prepare a full 
Environmental Impact Statement (EIS), in draft and final, as part of 
this process and prior to any final Federal decisionmaking on the 
proposed rules and guidance. An EIS is justified by the sweeping 
geographic scope of the proposals and their potentially significant 
effects on environmental resources, land-use patterns, growth and 
development, and regulated communities.
    Our Response: Following our review of the statutory language of 
section 4(b)(2) and our requirements for compliance under the National 
Environmental Policy Act of 1969 (NEPA), we find that the categorical 
exclusion found at 43 CFR 46.210(i) and NOAA Administrative Order 216-6 
applies to this policy. As reflected in the DOI regulatory provision, 
the Department of the Interior has found that the following category of 
actions would not individually or cumulatively have a significant 
effect on the human environment and is, therefore, categorically 
excluded from the requirement for completion of an environmental 
assessment or environmental impact statement: ``Policies, directives, 
regulations, and guidelines: that are of an administrative, financial, 
legal, technical, or procedural nature . . . .'' NOAA Administrative 
Order 216-6 contains a substantively identical exclusion for ``policy 
directives, regulations and guidelines of an administrative, financial, 
legal, technical or procedural nature.'' Section 6.03c.3(i). The NOAA 
provision also excludes ``preparation of regulations, Orders, manuals 
or other guidance that implement, but do not substantially change these 
documents, or other guidance.'' Id.
    At the time the DOI categorical exclusion was promulgated, there 
was no preamble language that would assist in interpreting what kinds 
of actions fall within the categorical exclusion. However, in 2008, the 
preamble for a language correction to the categorical exclusion 
provisions gave as an example of an action that would fall within the 
exclusion the issuance of guidance to applicants for transferring funds 
electronically to the Federal Government.
    This final policy is an action that is fundamentally administrative 
or procedural in nature. Although the policy addresses more than the 
timing of procedural requirements, it is nevertheless administrative 
and procedural in nature, because it goes no further than to clarify, 
in expressly non-binding terms, the existing 4(b)(2) exclusion process 
by describing how the Services undertake discretionary exclusion 
analyses as a result of statutory language, legislative history, case 
law, or other authority. This final policy is meant to complement the 
revisions to 50 CFR 424.19 regarding impact analyses of critical 
habitat designations and provide for a more predictable and transparent 
critical-habitat-exclusion process. This final policy is nonbinding and 
does not limit Secretarial discretion because it does not mandate 
particular outcomes in future decisions regarding exclusions from 
critical habitat. As elaborated elsewhere in this final policy, the 
exclusion of a particular area from a particular critical habitat 
designation is, and remains, discretionary.
    Specifically, this final policy explains how the Services consider 
partnerships and conservation plans, conservation plans permitted under 
section 10 of the Act, Tribal lands, national-security and homeland-
security impacts and military lands, Federal lands, and economic 
impacts in the exclusion process. The policy does not constrain the 
Services' discretion in making decisions with respect to exclusions 
from critical habitat. The considerations in this policy are consistent 
with the Act, its legislative history, and relevant circuit court 
opinions. Therefore, the policy statements are of an administrative 
(e.g., describing the current practices of the Service that have come 
about as a result of legislative history, case law, or other

[[Page 7244]]

authority), technical (e.g., edits for plain language), and/or 
procedural (e.g., clarifying an existing process for a Service or NMFS 
activity) nature.
    FWS reviewed the regulations at 43 CFR 46.215: Categorical 
Exclusions: Extraordinary Circumstances, and we have determined that 
none of the circumstances apply to this situation. Although the final 
policy will provide for a credible, predictable, and transparent 
critical-habitat-exclusion process, the effects of these changes would 
not ``have significant impacts on species listed, or proposed to be 
listed, on the List of Endangered or Threatened Species or have 
significant impacts on designated Critical Habitat for these species,'' 
as nothing in the policy is intended to determine or change the outcome 
of any critical habitat determination. Moreover, the policy would not 
require that any previous critical habitat designations be reevaluated 
on this basis. Furthermore, the 4(b)(2) policy does not ``[e]stablish a 
precedent for future action or represent a decision in principle about 
future actions with potentially significant environmental effects'' (43 
CFR 46.215(e)). None of the extraordinary circumstances in 43 CFR 
46.215(a) through (l) apply to the policy on implementing section 
4(b)(2) of the Act.
    NMFS also reviewed its exceptions and has found that this policy 
does not trigger any of the exceptions that would preclude reliance on 
the categorical exclusion provisions. It does not involve a geographic 
area with unique characteristics, is not the subject of public 
controversy based on potential environmental consequences, will not 
result in uncertain environmental impacts or unique or unknown risks, 
does not establish a precedent or decision in principle about future 
proposals, will not have significant cumulative impacts, and will not 
have any adverse effects upon endangered or threatened species or their 
habitats. NOAA Administrative Order 216-6, Sec.  5.05c.
    Comment (49): A commenter stated that NEPA review should not be a 
standard when evaluating conservation plans and that the Services 
should not evaluate whether a conservation plan, agreement, or 
partnership was subject to NEPA review when determining whether to 
exclude areas from critical habitat designations. See 79 FR 27057 (May 
12, 2014) (section 2.d. of the draft policy). Consideration of this 
factor discounts the many worthwhile conservation plans developed by 
private entities and State and local governments. The commenter stated 
that because NEPA only requires analysis of Federal actions (see 42 
U.S.C. 4332(2)(C)), conservation plans that are not approved by a 
Federal agency--such as those developed by citizens and State and local 
governments--would not undergo NEPA review. States, which are principal 
managers of wildlife within their borders, frequently develop 
conservation plans to benefit listed and non-listed species. Also, 
landowners can establish conservation banks or conservation easements 
without NEPA review or public input. Thus, the commenter stated that 
the application of this factor to plans and agreements for which they 
are often inapplicable would seem to automatically weigh against 
exclusion in most instances. Instead, the commenter suggests that the 
Services should focus on the effectiveness of the plan and its 
conservation value, regardless of the procedural processes used to 
establish the plan.
    Our Response: The list of factors the Services will consider in 
connection with exclusion analysis of non-permitted plans seems to have 
been misunderstood as absolute requirements for excluding areas covered 
by such plans. For some plans that the Services may evaluate (those 
that are Federal and may have a significant impact on the environment), 
it would be appropriate to consider whether NEPA reviews have been 
completed; for other plans, it may not be. The Services are not 
suggesting that every plan needs to have undergone NEPA review. Not all 
of the items listed under paragraph 2 (described above under the 
heading, Private or Other Non-Federal Conservation Plans and 
Partnerships, in General) are needed to ensure the Services consider a 
plan. To this end, the Services have modified the language preceding 
the list of factors for evaluating non-permitted conservation plans, to 
clarify that some of the factors may not be relevant to all plans.

Specific Language Suggested by Commenters

    Comment (50): Several commenters suggested specific line edits or 
word usage.
    Our Response: We have addressed these comments as appropriate in 
this document.
    Comment (51): A commenter suggested changing the phrase ``and meets 
the conservation needs of the species'' to ``and maintains the physical 
or biological features essential for the conservation of the species'' 
in draft policy element 3(c), which relates to permitted plans under 
section 10 of the Act. This change is suggested to maintain consistency 
in the use of terms related to critical habitat designations and 
exclusions.
    Our Response: The Services have elected not to make the suggested 
change. The language in question refers to permitted HCPs, SHAs, and 
CCAAs, and more specifically their underlying conservation plans. Plans 
developed to support these conservation vehicles are not necessarily 
designed using the terminology applicable to critical habitat 
designation. Therefore, we conclude that it is more appropriate to 
retain the more general language used in our proposal.
    Comment (52): One commenter stated it will be very difficult for 
the Services to determine if excluding one piece of habitat ``will 
result in the extinction of a species,'' as stated in the draft policy 
element 8. Therefore, the commenter recommends the language be changed 
to express a likelihood the action will result in the extinction of the 
species and stated this determination should be made according to the 
best available science. The commenter suggests the following as 
replacement language: ``We must not exclude an area if the best 
available science indicates that failure to designate it will likely 
result in the extinction of the species.''
    Our Response: Part 8 of the policy is a restatement of the 
statutory provision of the Act that states the Secretary shall not 
exclude an area if the exclusion will result in the extinction of the 
species concerned. To the extent that the statutory language is 
ambiguous, we decline to interpret it at this time.
    Comment (53): One commenter remarked there remains a fair amount of 
vague language in the factors that are considered during a 
discretionary 4(b)(2) exclusion analysis. Specifically, the commenter 
stated it is unclear if factors that begin with ``Whether'' will rank 
higher if the answer is affirmative. Also, factors that begin with 
``The degree to which,'' ``The extent or,'' and ``The demonstrated 
implementation'' must be clarified and quantified before they can be 
appropriately and fairly assigned weight in a designation of critical 
habitat.
    Our Response: The examples of language noted above from the draft 
policy were carefully chosen. As this is a policy and not a regulation, 
the Services chose language such as ``the degree to which'' to 
accommodate the gradations and variations in certain fact patterns 
relating to conservation partnerships and plans. Not all plans and 
partnerships are developed in the same manner, and no one set of 
evaluation criteria would apply. Rather, the Services' intent in 
drafting the language was to provide latitude in

[[Page 7245]]

evaluating different types of plans and partnerships. Further, the 
commenter does not provide any examples of how to quantify measures, 
nor does the commenter provide alternate language or suggested 
revisions to this section of the policy.
    Comment (54): One commenter suggested adding an additional factor 
under non-permitted plans and partnerships, ``Plans must be reasonably 
expected to achieve verifiable, beneficial results to qualify for 
exclusion from critical habitat designation.''
    Our Response: We appreciate the suggestions, but we believe these 
factors are already captured in the factors in the policy under 
paragraphs 2.f. (``The degree to which the plan or agreement provides 
for the conservation of the essential physical or biological features 
for the species.'') and 2.h. (``Whether the plan or agreement contains 
a monitoring program and adaptive management to ensure that the 
conservation measures are effective and can be modified in the future 
in response to new information.'') The existence of a monitoring 
program and adaptive management (paragraph 2.h.) speaks to verifiable 
results, and the statements regarding providing for the conservation of 
the essential features and effective conservation measures (paragraph 
2.f.) relate to beneficial results. Therefore, we did not adopt the 
suggested additions.
    Comment (55): One commenter suggested adding a fourth condition 
under the permitted plans section of the policy: ``If plans cannot be 
implemented or do not achieve the intended results, a re-evaluation of 
critical habitat designation may be required.''
    Our Response: As discussed in this final policy in the framework 
section, we base the exclusion not only on the plan, but on the 
conservation partnership. Therefore, our first step would be to work 
with that partner to implement the plan, bring the plan into 
compliance, or adjust the conservation management or objectives of the 
plan to be effective for the conservation of the covered species. We of 
course retain the authority under the Act to revise the designation, if 
necessary, through the rulemaking process to include these areas in 
critical habitat, if appropriate. For the above reasons, while we 
considered the suggestion to add a policy element, we have determined 
that it is not necessary.
    Comment (56): One commenter suggested adding the following language 
to the draft policy element paragraph 5: ``If the agency requesting the 
exclusion does not provide us with a specific justification, we will 
contact the agency to require that it provide a specific justification. 
When the agency provides a specific justification, we will defer to the 
expert judgment of the DoD, DHS, or another Federal agency.''
    Our Response: The suggested text is paraphrased from the policy 
preamble. Therefore, the Services do not agree that this language adds 
substantively to the clarity of the policy, and we did not adopt this 
suggestion.
    Comment (57): A commenter suggested we add the following language 
to the policy regarding private lands: ``The Service recognizes that 
many listed species are found primarily or partially on private lands. 
For some endemic species, their entire range may be wholly on private 
lands, making partnerships with those landowners far more valuable than 
any expected gain that might be achieved through the incremental gains 
expected through a critical habitat designation and subsequent section 
7 consultations. We acknowledge the potential incremental gain in 
conservation value from designating critical habitat on private land 
can be undermined if the landowner is not a partner in that designation 
or is opposed to that designation. Private land tracts that are 
proposed as critical habitat are likely to maximize their recovery 
value for listed species if the landowner is amenable to conservation 
and recovery activities on their lands. Therefore, landowners whose 
property has been proposed as critical habitat and wish to be excluded 
from that designation will be given serious consideration for exclusion 
if they provide information concerning how the lands will be managed 
for the conservation of the species.''
    Our Response: The Services generally will consider exclusion of 
private lands from a designation of critical habitat if specifically 
requested. Private lands are needed for the conservation of endangered 
and threatened species. If a private landowner requests exclusion, and 
provides a reasoned rationale for such exclusion, including measures 
undertaken to conserve species and habitat on the land at issue (such 
that the benefit of inclusion is reduced), the Services would consider 
exclusion of those lands. However, the Services decline to include a 
policy element in this policy covering this particular suggestion.
    Comment (58): A commenter suggested that we give great weight and 
consideration to exclusion of lands whose landowners allow access to 
their lands for purposes of surveys, monitoring, and other conservation 
and research activities.
    Our Response: The Services would consider and give appropriate 
weight, on a case-by-case basis, to the benefits of the information 
gathered, should the Secretaries choose to enter into the discretionary 
4(b)(2) exclusion analysis. If not yet established, we hope that 
arrangements of this sort with landowners could lead to conservation 
partnerships in the future. Development of those partnerships could 
result in furthering the conservation of the species.
    Comment (59): A commenter suggested that the Services should 
include specific text in the policy regarding the importance of private 
landowner partnership and cooperation in species recovery efforts. 
Furthermore, the commenter suggests the Services give great weight to 
excluding private lands whose owners have expressed interest in 
participation in voluntary recovery efforts.
    Our Response: The Services agree that recovery of listed species 
relies on the cooperation of private landowners and managers. The 
commenter brings to light an inherent tension with listing and recovery 
under the Act. One might think that the process of listing, designating 
critical habitat, developing a recovery plan, carrying out recovery 
plan objectives, and ultimately delisting a species should be a linear 
process. It is not. Adding species to the Federal Lists of Endangered 
and Threatened Wildlife and Plants and identifying areas that meet the 
definition of ``critical habitat'' are science-based processes. Areas 
meeting the definition of ``critical habitat'' for a given species must 
be identified as eligible for designation as critical habitat, 
regardless of landownership or potential future conflict with recovery 
opportunities, such as mentioned by the commenter. The Secretary may, 
however, exclude areas based on non-biological factors. The subject of 
this policy is to make transparent how the Services plan to address 
certain fact patterns under which the Secretaries will consider 
excluding particular areas from a designation. The presumption of 
cooperation for purposes of recovery of a species is not a particular 
fact pattern the Services have chosen to include, but is inherently 
captured under the partnership element of this policy. As stated in the 
permitted plans section of this policy, the Services would not weigh 
heavily a prospective partnership in which a landowner merely may 
choose to cooperate with the Services. If habitat-based threats are the 
main driver for a species' listing, the designation of critical habitat 
could be an important tool for species conservation.

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    Comment (60): We received numerous specific comments in several 
categories that were not directly relevant to this final policy on 
exclusions from critical habitat, and, therefore, they are not 
addressed in this section. While not directly relevant to this policy, 
we may address some of these issues in future rulemaking or policy 
development by the Services. These include:
     Issues regarding earlier coordination with States in the 
designation of critical habitat;
     Development and designation processes for critical 
habitat;
     Development of conservation plans;
     Relocation of existing critical habitat designations from 
airport lands; and
     Nonessential experimental populations.

Required Determinations

    We intend to look to this policy as general non-binding guidance 
when we consider exclusions from critical habitat designations. The 
policy does not limit the Secretaries' discretion in particular 
designations. In each designation, we are required to comply with 
various Executive Orders and statutes for those individual rulemakings. 
Below we discuss compliance with several Executive Orders and statutes 
as they pertain to this final policy.

Regulatory Planning and Review (Executive Orders 12866 and 13563)

    Executive Order 12866 provides that the Office of Information and 
Regulatory Affairs (OIRA) in the Office of Management and Budget will 
review all significant rules. OIRA has determined that this final 
policy is a significant action because it may create a serious 
inconsistency with other agency actions.
    Executive Order 13563 reaffirms the principles of E.O. 12866 while 
calling for improvements in the nation's regulatory system to promote 
predictability, to reduce uncertainty, and to use the best, most 
innovative, and least burdensome tools for achieving regulatory ends. 
The executive order directs agencies to consider regulatory approaches 
that reduce burdens and maintain flexibility and freedom of choice for 
the public where these approaches are relevant, feasible, and 
consistent with regulatory objectives. E.O. 13563 emphasizes further 
that our regulatory system must be based on the best available science 
and that the rulemaking process must allow for public participation and 
an open exchange of ideas. We have developed this policy in a manner 
consistent with these requirements.

Unfunded Mandates Reform Act (2 U.S.C. 1501 et seq.)

    In accordance with the Unfunded Mandates Reform Act (2 U.S.C. 1501 
et seq.):
    (a) We find this final policy will not ``significantly or 
uniquely'' affect small governments. We have determined and certify 
pursuant to the Unfunded Mandates Reform Act, 2 U.S.C. 1502, that this 
policy will not impose a cost of $100 million or more in any given year 
on local or State governments or private entities. Small governments 
will not be affected because the final policy will not place additional 
requirements on any city, county, or other local municipalities.
    (b) This final policy will not produce a Federal mandate on State, 
local, or Tribal governments or the private sector of $100 million or 
greater in any year; that is, it is not a ``significant regulatory 
action'' under the Unfunded Mandates Reform Act. This policy will 
impose no obligations on State, local, or Tribal governments because 
this final policy is meant to complement the amendments to 50 CFR 
424.19, and is intended to clarify expectations regarding critical 
habitat and provide for a more predictable and transparent critical-
habitat-exclusion process. The only entities directly affected by this 
final policy are the FWS and NMFS. Therefore, a Small Government Agency 
Plan is not required.

Takings--Executive Order 12630

    In accordance with Executive Order 12630, this final policy will 
not have significant takings implications. This final policy will not 
pertain to ``taking'' of private property interests, nor will it 
directly affect private property. A takings implication assessment is 
not required because this final policy (1) will not effectively compel 
a property owner to suffer a physical invasion of property and (2) will 
not deny all economically beneficial or productive use of the land or 
aquatic resources. This final policy will substantially advance a 
legitimate government interest (clarify expectations regarding critical 
habitat and provide for a more predictable and transparent critical-
habitat-exclusion process) and will not present a barrier to all 
reasonable and expected beneficial use of private property.

Federalism--Executive Order 13132

    In accordance with Executive Order 13132 (Federalism), this final 
policy does not have Federalism implications and a Federalism summary 
impact statement is not required. This final policy pertains only to 
exclusions from designations of critical habitat under section 4 of the 
Act, and will not have substantial direct effects on the States, on the 
relationship between the Federal Government and the States, or on the 
distribution of power and responsibilities among the various levels of 
government.

Civil Justice Reform--Executive Order 12988

    In accordance with Executive Order 12988 (Civil Justice Reform), 
this final policy will not unduly burden the judicial system and meets 
the requirements of sections 3(a) and 3(b)(2) of the Order. The 
clarification of expectations regarding critical habitat and providing 
a more predictable and transparent critical-habitat-exclusion process 
will make it easier for the public to understand our critical-habitat-
designation process, and thus should not significantly affect or burden 
the judicial system.

Paperwork Reduction Act of 1995

    This final policy does not contain any new collections of 
information that require approval by the Office of Management and 
Budget (OMB) under the Paperwork Reduction Act (44 U.S.C. 3501 et 
seq.). This final policy will not impose recordkeeping or reporting 
requirements on State or local governments, individuals, businesses, or 
organizations. An agency may not conduct or sponsor, and a person is 
not required to respond to, a collection of information unless it 
displays a currently valid OMB control number.

National Environmental Policy Act (NEPA)

    We have analyzed this policy in accordance with the criteria of the 
National Environmental Policy Act (NEPA) (42 U.S.C. 4332(c)), the 
Council on Environmental Quality's Regulations for Implementing the 
Procedural Provisions of NEPA (40 CFR parts 1500-1508), the Department 
of the Interior's NEPA procedures (516 DM 2 and 8; 43 CFR part 46), and 
NOAA's Administrative Order regarding NEPA compliance (NAO 216-6 (May 
20, 1999)).
    We have determined that this policy is categorically excluded from 
NEPA documentation requirements consistent with 40 CFR 1508.4 and 43 
CFR 46.210(i). This categorical exclusion applies to policies, 
directives, regulations, and guidelines that are ``of an 
administrative, financial, legal, technical, or procedural nature.'' 
This action does not trigger an extraordinary circumstance, as outlined 
in 43 CFR

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46.215, applicable to the categorical exclusion. Therefore, this policy 
does not constitute a major Federal action significantly affecting the 
quality of the human environment.
    We have also determined that this action satisfies the standards 
for reliance upon a categorical exclusion under NOAA Administrative 
Order (NAO) 216-6. Specifically, the policy fits within two categorical 
exclusion provisions in Sec.  6.03c.3(i)--for ``preparation of 
regulations, Orders, manuals, or other guidance that implement, but do 
not substantially change these documents, or other guidance'' and for 
``policy directives, regulations and guidelines of an administrative, 
financial, legal, technical or procedural nature.'' NAO 216-6, Sec.  
6.03c.3(i). The policy would not trigger an exception precluding 
reliance on the categorical exclusions because it does not involve a 
geographic area with unique characteristics, is not the subject of 
public controversy based on potential environmental consequences, will 
not result in uncertain environmental impacts or unique or unknown 
risks, does not establish a precedent or decision in principle about 
future proposals, will not have significant cumulative impacts, and 
will not have any adverse effects upon endangered or threatened species 
or their habitats. Id. Sec.  5.05c. As such, it is categorically 
excluded from the need to prepare an Environmental Assessment. Issuance 
of this rule does not alter the legal and regulatory status quo in such 
a way as to create any environmental effects.

Government-to-Government Relationship With Tribes

    In accordance with Executive Order 13175 (``Consultation and 
Coordination with Indian Tribal Governments'', November 6, 2000), the 
Department of the Interior Manual at 512 DM 2, the Department of 
Commerce (DOC) Tribal Consultation and Coordination Policy (May 21, 
2013), DOC Departmental Administrative Order (DAO) 218-8, and NOAA 
Administrative Order (NAO) 218-8 (April 2012), we have considered 
possible effects of this final policy on federally recognized Indian 
Tribes. Following an exchange of information with tribal 
representatives, we have determined that this policy, which is general 
in nature, does not have tribal implications as defined in Executive 
Order 13175. Our intent with this policy is to provide non-binding 
guidance on our approach to considering exclusion of areas from 
critical habitat, including tribal lands. This policy does not 
establish a new direction. We will continue to collaborate and 
coordinate with Tribes on issues related to federally listed species 
and their habitats and work with them as we promulgate individual 
critical habitat designations, including consideration of potential 
exclusions on the basis of tribal interests. See Joint Secretarial 
Order 3206 (``American Indian Tribal Rights, Federal-Tribal Trust 
Responsibilities, and the Endangered Species Act'', June 5, 1997).

Energy Supply, Distribution, or Use

    Executive Order 13211 ``Actions Concerning Regulations That 
Significantly Affect Energy Supply, Distribution, or Use'' requires 
agencies to prepare Statements of Energy Effects when undertaking 
certain actions. This final policy is not expected to significantly 
affect energy supplies, distribution, or use. Therefore, this action is 
not a significant energy action and no Statement of Energy Effects is 
required.

Policy on Implementation of Section 4(b)(2) of the Act

    1. The decision to exclude any particular area from a designation 
of critical habitat is always discretionary, as the Act states that the 
Secretaries ``may'' exclude any area. In no circumstances is an 
exclusion of any particular area required by the Act.
    2. When we undertake a discretionary 4(b)(2) exclusion analysis, we 
will evaluate the effect of non-permitted conservation plans or 
agreements and their attendant partnerships on the benefits of 
inclusion and the benefits of exclusion of any particular area from 
critical habitat by considering a number of factors. The list of 
factors that we will consider for non-permitted conservation plans or 
agreements is shown below. This list is not exclusive; all items may 
not apply to every non-permitted conservation plan or agreement and are 
not requirements of plans or agreements.
    a. The degree to which the record of the plan supports a conclusion 
that a critical habitat designation would impair the realization of 
benefits expected from the plan, agreement, or partnership.
    b. The extent of public participation in the development of the 
conservation plan.
    c. The degree to which there has been agency review and required 
determinations (e.g., State regulatory requirements), as necessary and 
appropriate.
    d. Whether National Environmental Policy Act (NEPA; 42 U.S.C. 4321 
et seq.) compliance was required.
    e. The demonstrated implementation and success of the chosen 
mechanism.
    f. The degree to which the plan or agreement provides for the 
conservation of the essential physical or biological features for the 
species.
    g. Whether there is a reasonable expectation that the conservation 
management strategies and actions contained in the conservation plan or 
agreement will be implemented.
    h. Whether the plan or agreement contains a monitoring program and 
adaptive management to ensure that the conservation measures are 
effective and can be modified in the future in response to new 
information.
    3. When we undertake a discretionary 4(b)(2) exclusion analysis, we 
will always consider areas covered by a permitted candidate 
conservation agreement with assurances (CCAA), safe harbor agreement 
(SHA), or habitat conservation plan (HCP), and we anticipate 
consistently excluding such areas from a designation of critical 
habitat if incidental take caused by the activities in those areas is 
covered by the permit under section 10 of the Act and the CCAA/SHA/HCP 
meets all of the following conditions:
    a. The permittee is properly implementing the CCAA/SHA/HCP and is 
expected to continue to do so for the term of the agreement. A CCAA/
SHA/HCP is properly implemented if the permittee is and has been fully 
implementing the commitments and provisions in the CCAA/SHA/HCP, 
Implementing Agreement, and permit.
    b. The species for which critical habitat is being designated is a 
covered species in the CCAA/SHA/HCP, or very similar in its habitat 
requirements to a covered species. The recognition that the Services 
extend to such an agreement depends on the degree to which the 
conservation measures undertaken in the CCAA/SHA/HCP would also protect 
the habitat features of the similar species.
    c. The CCAA/SHA/HCP specifically addresses that species' habitat 
and meets the conservation needs of the species in the planning area.
    We generally will not rely on CCAAs/SHAs/HCPs that are still under 
development as the basis of exclusion of a particular area from a 
designation of critical habitat.
    4. When we undertake a discretionary 4(b)(2) exclusion analysis, we 
will always consider exclusion of Tribal lands, and give great weight 
to Tribal concerns in analyzing the benefits of exclusion. However, 
Tribal concerns are not a factor in determining what areas, in the 
first instance, meet the definition of ``critical habitat.''

[[Page 7248]]

    5. When we undertake a discretionary 4(b)(2) exclusion analysis, we 
will always consider exclusion of areas for which a Federal agency has 
requested exclusion based on an assertion of national-security or 
homeland-security concerns, and will give great weight to national-
security or homeland-security concerns in analyzing the benefits of 
exclusion. National-security and/or homeland-security concerns are not 
a factor, however, in the process of determining what areas, in the 
first instance, meet the definition of ``critical habitat.''
    6. Except in the circumstances described in 5 above, we will focus 
our exclusions on non-Federal lands. Because the section 7(a)(2) 
consultation requirements apply to projects carried out on Federal 
lands where there is discretionary Federal involvement or control, the 
benefits of designating Federal lands as critical habitat are typically 
greater than the benefits of excluding Federal lands or of designating 
non-Federal lands.
    7. When the Services are determining whether to undertake a 
discretionary 4(b)(2) exclusion analysis as a result of the probable 
incremental economic impacts of designating a particular area, it is 
the nature of those impacts, not necessarily a particular threshold 
level, that is relevant to the Services' determination.
    8. For any area to be excluded, we must find that the benefits of 
excluding that area outweigh the benefits of including that area in the 
designation. Although we retain discretion because we cannot anticipate 
all fact patterns that may occur, it is the general practice of the 
Services to exclude an area when the benefits of exclusion outweigh the 
benefits of inclusion. We must not exclude an area if the failure to 
designate it will result in the extinction of the species.

Authors

    The primary authors of this policy are the staff members of the 
Endangered Species Program, U.S. Fish and Wildlife Service, 5275 
Leesburg Pike, Falls Church, VA 22041-3803, and the National Marine 
Fisheries Service's Endangered Species Division, 1335 East-West 
Highway, Silver Spring, MD 20910.

Authority

    The authority for this action is section 4(h) of the Endangered 
Species Act of 1973, as amended (16 U.S.C. 1531 et seq.).

    Dated: January 29, 2016.
Michael J. Bean,
Principal Deputy Assistant Secretary for Fish and Wildlife and Parks.

    Dated: January 29, 2016.
Samuel D. Rauch, III,
Deputy Assistant Administrator for Regulatory Programs, National Marine 
Fisheries Service.
[FR Doc. 2016-02677 Filed 2-10-16; 8:45 am]
 BILLING CODE 4333-15-P; 3510-22-P