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Impact of Review of New ESA Rules Raises Builder Concerns
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President Barack Obama and Secretary of the Interior Ken Salazar mark the 160th Anniversary of the Department of the Interior in a ceremony at Interior headquarters. Photo: Tami Heilemann, DOI-NBC | Concerned over recent decisions by the Obama Administration to reconsider Endangered Species Act (ESA) regulations, NAHB President and CEO Jerry Howard in an April 3 letter urged Secretary of the Interior Ken Salazar to ensure that the review process now underway does not have a detrimental impact on housing.
On March 3, President Obama directed the secretaries of the Interior and Commerce to review Dec. 16, 2008 regulations by the Bush Administration aimed at improving the application of Section 7 of the ESA, which requires all federal agencies to consult with the U.S. Fish and Wildlife Service to ensure that their actions do not jeopardize listed species or destroy or adversely modify critical habitat.
The Bush amendments — the first regulatory changes to the ESA in more than 25 years — were widely supported by the regulated community, including NAHB.
The Obama White House has asked for a review of December’s amendments to the ESA — which streamline Section 7 and limit mandatory consultations — to determine if a new rulemaking is needed. In the meantime, the incoming Administration has asked officials to “exercise their discretion” to follow consultation and concurrence practices that were in place before the latest rules were announced.
Also, the omnibus appropriations bill signed by the President on March 12 gives the Commerce and Interior secretaries the opportunity to unilaterally revoke the Dec. 16 ESA amendments — without public notice or comment.
“In the wake of these two events, it is unclear how or when the Administration will move forward in making its decisions or how current ESA consultations will be completed,” Howard said. “These answers are critical to ensuring the uninterrupted implementation of the ESA.”
Increased Costs and Long Delays
Howard indicated that ESA regulation has serious implications for the nation’s home builders.
“NAHB members, and by extension members of the public who are seeking to purchase a new home, are often directly impacted by the consequences of the ESA Section 7 consultation process through various permitting restrictions and terms placed on residential construction projects that limit the number of housing units, increase costs and result in project delays,” Howard said.
NAHB members whose land development projects occur in areas believed to be inhabited by an endangered species are affected by the ESA consultation requirements when their proposed land development activity triggers the need for a federal permit, such as a wetlands permit.
During the consultation process, developers and builders often are required to modify their projects by eliminating buildable lots and paying expensive offsite habitat mitigation fees to federal agencies; they can even have their project rejected.
A 2003 report to Congress by the Government Accountability Office found dozens of examples where the permitting process delayed even routine residential projects by more than two years.
A Timeframe, Limits and Clarification Needed
In his letter, Howard urged the secretaries of the Interior and Commerce to “identify the timeframe during which the review will occur, limit their review to the consultation requirements [and not a wholesale review of the ESA] and clarify how current projects that have or are undergoing consultation will proceed.”
“Due to both the uncertainties associated with the consultation process and the need to provide continued protection for federally listed species,” Howard said, “the agencies are urged to identify target dates for the completion of their review and any subsequent rulemaking, should one be deemed necessary.”
Howard’s letter also voiced concern that President Obama’s amendment was silent on how the agencies are to treat projects that are currently undergoing consultation.
For example, consultations under the new Bush rules were completed on Feb. 19 for two highway infrastructure projects in Portland, Ore., but uncertainties on the validity of permits raised by the Obama memorandum could potentially bring this and other projects to a halt, until clarification is made.
Howard also voiced opposition to the Interior and Commerce departments revoking the Dec. 16 rule under language inserted by Congress into the funding bill.
“NAHB does not believe revoking legally issued rules without providing an opportunity for public notice and comment is prudent or consistent with either the President’s memo or his pledge to conduct the business of the American people in an open and transparent manner,” he said.
“If the results of the presidentially initiated review of the Dec. 16 rule indicate that it should be repealed, the agencies are strongly urged to follow the same rulemaking protocols and processes to rescind the rule as were followed to enact the rule, including public participation,” Howard said.
For more information on the Endangered Species Act, e-mail Michael Mittelholzer at NAHB, or call him at 800-368-5242 x8660.
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