United States Court of Appeals
FOR THE DISTRICT OF COLUMBIA CIRCUIT
Argued December 8, 2006 Decided January 30, 2007
No. 06-5059
KARST ENVIRONMENTAL EDUCATION AND PROTECTION, INC.,
ET AL.,
APPELLANTS
v.
ENVIRONMENTAL PROTECTION AGENCY, ET AL.,
APPELLEES
Appeal from the United States District Court
for the District of Columbia
(No. 05cv01190)
W. Henry Graddy, IV., pro hac vice, argued the cause for
appellants. On the briefs was David G. Bookbinder.
Jennifer L. Scheller, Attorney, U.S. Department of Justice,
argued the cause for Federal Appellees. With her on the brief
was Todd S. Aagaard, Attorney. R. Craig Lawrence, Assistant
U.S. Attorney, entered an appearance.
Maria V. Gillen argued the cause for appellee Tennessee
Valley Authority. With her on the brief were Harriet A. Cooper
and Frank H. Lancaster.
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Robert M. Andersen argued the cause for appellees
Inter-Modal Transportation Authority, Inc., et al. With him on
the brief was D. Randall Benn.
Before: ROGERS and TATEL, Circuit Judges, and WILLIAMS,
Senior Circuit Judge.
Opinion for the Court filed by Circuit Judge TATEL.
TATEL, Circuit Judge: Seeking to halt several local
governmental entities in Kentucky from developing a transit
park, appellant environmental organizations sued the
Environmental Protection Agency, the Department of Housing
and Urban Development, and the Tennessee Valley Authority,
alleging that these agencies failed to conduct the environmental
and historical assessments required, respectively, by the
National Environmental Policy Act (NEPA) and the National
Historic Preservation Act (NHPA). Because neither EPA nor
HUD engaged in “final agency action” within the meaning of
section 704 of the Administrative Procedure Act—a prerequisite
for both NEPA and NHPA actions against federal agencies—we
affirm the district court’s dismissal of the complaint against
those two agencies. Although TVA did take final agency action
by making a grant to a transit park tenant, because appellants
have produced no evidence of continuing TVA authority over
the project, we affirm the district court’s dismissal of the
complaint against TVA for mootness.
I.
“Because we review here a decision granting [a] motion to
dismiss, we must accept as true all of the factual allegations
contained in the complaint.” Swierkiewicz v. Sorema, 534 U.S.
506, 508 n.1 (2002). Viewed that way, the complaint tells the
following story:
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In 1998, Warren County and the city of Bowling Green,
Kentucky, decided to build the “Kentucky Trimodal Transpark”
(“Transpark”), an $80 million 4,000-6,000 acre industrial park
and transportation complex that would include, among other
facilities, a new airport, a new rail hub, and extended highways.
Located six miles south of Mammoth Cave National Park, the
Transpark site rests on a vast karst plain—a topography
characterized by sinkholes, caves, and underground streams,
rivers, and groundwater. Adjacent to the site are several areas
of historic significance, including the Oakland Freeport Historic
District, a site listed in the National Register of Historic Places,
and other Reconstruction-era African-American communities
that have applied for historic status.
To develop the Transpark, the county and the city created
the Inter-Modal Transportation Authority (ITA), a nonprofit
corporation authorized, among other things, to apply for and
receive grants from federal agencies. In 2004, ITA began
construction of the first phase of the Transpark, which included
an interior road, water and sewer infrastructure, technical
training facilities, and a building for Bowling Green
Metalforming (“Metalforming”), an automobile parts
manufacturer. During the next few years, the Federal Highway
Administration (FHWA) allocated $8.75 million to ITA for
highway construction and expansion. FHWA then began the
environmental and historical reviews required, respectively, by
the National Environmental Policy Act, 42 U.S.C. § 4321 et
seq., and the National Historic Preservation Act, 16 U.S.C.
§ 470 et seq. NEPA requires federal agencies to prepare an
environmental impact statement (EIS), which assesses a
project’s environmental impact and identifies alternatives, for all
proposed “major Federal actions significantly affecting the
quality of the human environment.” 42 U.S.C. § 4332(C).
NHPA requires that before funding or licensing a “[f]ederal or
federally assisted undertaking,” federal agencies must (1) “take
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into account the effect of the undertaking on any district, site,
building, structure, or object that is included in or eligible for
inclusion in the National Register,” and (2) “afford the Advisory
Council on Historic Preservation . . . a reasonable opportunity to
comment with regard to such undertaking.” 16 U.S.C. § 470f.
Other federal agencies also became involved. The Federal
Aviation Administration, which must approve the closing of the
existing airport (because it provided substantial funding for its
construction), studied the feasibility of replacing the old airport
with a new one. Congress appropriated $3.75 million for EPA
to spend on water and sewer infrastructure, and another $1.75
million for HUD to spend on a training center. And TVA,
pursuant to the “Valley Advantage” contract, awarded $500,000
to Metalforming for the installation of electrical equipment.
Concerned about the Transpark’s impact on Mammoth
Cave’s ecosystem, the karst plain’s underground water sources,
and the nearby historic sites, Appellants Karst Environmental
Education and Protection and Warren County Citizens for
Managed Growth, along with some of their board members
(throughout this opinion, we refer to appellants collectively as
“Karst”) filed a complaint alleging that EPA, HUD, and TVA all
violated both NEPA and NHPA by failing to conduct the
required environmental and historical reviews. ITA, Warren
County, and Bowling Green moved to intervene as defendants
(“local intervenors”), in response to which Karst filed an
amended complaint adding allegations against all three and
asking the court to “halt[] all demolition and construction of the
Transpark until NEPA and NHPA have been fully complied
with.” Am. Compl. 27.
The district court granted EPA and HUD’s joint motion to
dismiss for lack of subject matter jurisdiction under Federal
Rule of Civil Procedure 12(b)(1). “[F]or a court to have
5
jurisdiction over claims seeking judicial review,” the district
court explained, “it must determine that the action is final.”
Karst Envtl. Educ. & Prot., Inc. v. EPA, 403 F. Supp. 2d 74, 80
(D.D.C. 2005). The court found that HUD took no final agency
action because it had yet to act on local intervenors’ grant
application. Id. at 81. Because the district court concluded that
local intervenors’ request for EPA advice on the Transpark did
not amount to a major federal action that would trigger NEPA,
it never determined whether EPA engaged in final agency
action. Id. at 80-81 (“‘[T]he power to give nonbinding advice
to a nonfederal actor’ does not constitute a major federal
action.” (quoting Vill. of Los Ranchos de Albuquerque v.
Barnhart, 906 F.2d 1477, 1482 (10th Cir. 1990))). The court
dismissed Karst’s claims against TVA as moot because “the
action complained of”—TVA’s $500,000 grant to
Metalforming—“has been completed and no effective relief is
available.” Id. at 82. Without separate analysis, the district
court also granted local intervenors’ motion to dismiss. Id. at 76
n.1, 82-83. Karst appeals.
II.
Before considering the merits, we must determine whether
Karst has Article III standing. See Steel Co. v. Citizens for a
Better Envt., 523 U.S. 83, 94-102 (1998) (holding that federal
courts must ensure that they have jurisdiction before considering
the merits of a case). The “irreducible constitutional minimum
of standing” consists of three elements: (1) an “injury in fact”
that is (2) “fairly . . . trace[able] to the challenged action of the
defendant,” and (3) “likely . . . redress[able] by a favorable
decision.” Lujan v. Defenders of Wildlife, 504 U.S. 555, 560-61
(1992) (first alteration in original, internal quotations marks and
citations omitted). EPA and HUD argue that Karst fails to
satisfy the latter two requirements because nothing in the
complaint alleges that the two agencies injured Karst by either
6
funding or approving the Transpark. It follows, the two
agencies argue, that Karst’s injuries from the Transpark
development are not redressable.
Contrary to this argument, however, Karst does allege
funding by both EPA and HUD—specifically that the Transpark
“has already benefited from, and is based on, pervasive federal
action in the form of financial assistance from EPA, HUD, and
TVA,” Am. Compl. 12, and that “a portion of the funding for . . .
construction [of the first phase of the Transpark] was federal
funding from one or more of the [d]efendants,” id. at 15.
Assuming the truth of these claims and that Karst will succeed
on the merits, as we must for purposes of standing, see City of
Waukesha v. EPA, 320 F.3d 228, 235 (D.C. Cir. 2003) (“[I]n
reviewing the standing question, the court must be careful not to
decide the questions on the merits for or against the plaintiff,
and must therefore assume that on the merits the plaintiffs would
be successful in their claims.”), these allegations suffice to
establish both causation and redressability. Accordingly, we
turn to the merits.
As indicated above, the district court dismissed the case
against HUD because it took no “final agency action” and
against EPA because it took no “major federal action.” Karst,
403 F. Supp. 2d at 80-81. The district court’s decision is
unassailable. Relying on the Supreme Court’s holding in Lujan
v. National Wildlife Federation, 492 U.S. 871 (1990), that
“person[s] claiming a right to sue [under NEPA] must identify
some ‘agency action’ that [adversely] affects [them],” id. at 882,
we suggested in Public Citizen v. Office of U.S. Trade
Representatives, 970 F.2d 916, 918 (D.C. Cir. 1992) (“Public
Citizen I”), and later held in Public Citizen v. U.S. Trade
Representative, 5 F.3d 549, 551 (D.C. Cir. 1993) (“Public
Citizen II”), that because NEPA creates no private right of
action, challenges to agency compliance with the statute must be
7
brought pursuant to the Administrative Procedure Act, 5 U.S.C.
§ 551 et seq., which requires “final agency action for which
there is no other adequate remedy in a court.” Id. § 704. In San
Carlos Apache Tribe v. United States, 417 F.3d 1091 (9th Cir.
2005), the Ninth Circuit reached the same conclusion with
respect to NHPA, explaining that because the statute creates no
private right of action, plaintiffs must file NHPA claims
pursuant to the APA. Id. at 1099. Because in Public Citizen I
and II we relied on Lujan v. National Wildlife Federation to hold
that NEPA actions must be brought under the APA, and because
NHPA, like NEPA, contains no private right of action, we agree
with the Ninth Circuit that NHPA actions must also be brought
pursuant to the APA.
In the NEPA context, the “final agency action” required by
the APA must also be a “major federal action” under NEPA.
See Found. on Econ. Trends v. Lyng, 943 F.2d 79, 85 (D.C. Cir.
1991). Because of the “operational similarity” between NEPA
and NHPA, both of which impose procedural obligations on
federal agencies after a certain threshold of federal involvement,
courts treat “major federal actions” under NEPA similarly to
“federal undertakings” under NHPA. See Sac and Fox Nation
of Mo. v. Norton, 240 F.3d 1250, 1263 (10th Cir. 2001); San
Carlos Apache Tribe, 417 F.3d at 1097. Thus, just as the “final
agency action” in a NEPA claim must be a “major federal
action,” the “final agency action” in an NHPA claim must be a
“federal undertaking.”
On appeal, Karst does not argue that either EPA or HUD
engaged in final agency action. Instead, it maintains that it had
no need to establish final agency action because “the cumulative
substantial involvement of federal agencies in the Transpark
federalized the project from its inception.” Appellants’ Br. 25.
Even though the federal government is not the Transpark’s
primary developer, Karst alleges, the project enjoys sufficient
8
federal involvement to subject EPA, HUD, and TVA to NEPA
and NHPA requirements. Based on this federal involvement,
Karst argues that:
The funding, permitting and construction of the
Transpark project is a “major federal action . . .”
within the meaning of . . . NEPA . . . . But for the
federal funding available from and/or provided
by EPA, FAA, FHWA, HUD, TVA, and other
sources, no part of the Transpark activities which
are the subject of this complaint would have
been undertaken. The actions taking place at the
Transpark that are the subject of this Complaint
are thus final agency action for purposes of the
APA.
Am. Compl. 25. Because of this, Karst claims, “[d]efendants
have violated NEPA by failing to prepare an Environmental
Impact Statement for the entire Transpark.” Id. at 26. Similarly,
Karst alleges that the three agencies, by failing to conduct a
historical review of the Transpark, violated NHPA because
“EPA, HUD and TVA jurisdiction over the project requires
compliance with Section 106 of NHPA prior to agency funding
or approval of any aspect of the project.” Id. at 21.
Karst bases its “federalization” claim on two cases,
Maryland Conservation Council v. Gilchrist, 808 F.2d 1039 (4th
Cir. 1986), and Macht v. Skinner, 916 F.2d 13 (D.C. Cir. 1990).
In Gilchrist, an environmental organization challenged a local
government’s plan to construct a highway, part of which would
cross a state park and would thus likely require approval from
several federal agencies, including the Interior Department,
which had substantially funded the park. 808 F.2d at 1042.
Under these circumstances, the court concluded, the highway
amounted to a major federal action that triggered NEPA’s EIS
9
requirement because “a non-federal project is considered a
federal action if it cannot begin or continue without prior
approval of a federal agency.” Id. (internal quotation marks
omitted). The court explained its reasoning as follows:
The decision of the Secretary of the Interior to
approve the project, and the decision of any
other Secretary whose authority may extend to
the project, would inevitably be influenced if the
County were allowed to construct major
segments of the highway before issuance of a
final EIS. The completed segments would stand
like gun barrels pointing into the heartland of the
park. . . . It is precisely this sort of influence on
federal decision-making that NEPA is designed
to prevent. Non-federal actors may not be
permitted to evade NEPA by completing a
project without an EIS and then presenting the
responsible federal agency with a fait accompli.
Id. (internal quotation marks and citation omitted).
In Macht, which involved a challenge to Maryland’s
construction of a light rail line that would have required a
wetlands permit from the Army Corps of Engineers, we cited
Gilchrist with approval, observing that “[t]he reasoning of the
Fourth Circuit in Gilchrist is sound: the state may not begin
construction of any part of a project if the effect of such
construction would be to limit significantly the options of the
federal officials who have discretion over substantial portions of
the project.” Id. at 19. That said, we limited the federalization
theory to situations of “substantial” federal involvement. Id.
Applying that standard to the light rail project, we found
insufficient evidence of federal involvement because federal
agencies had discretion over “only a negligible portion of the
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entire project,” as compared to Gilchrist, “where several
agencies had discretion over a substantial part of the highway
project.” Id. (emphasis added, internal quotation marks
omitted).
Relying on Gilchrist and Macht, Karst argues it has no need
to demonstrate “final agency action” pursuant to the APA.
According to Karst, “it is the construction activity by the non-
federal ‘partner’ with the federal government in their ‘joint
venture’ or such action by the non-federal entity that will face
the ‘inevitable exercise of federal approval power’ that triggers
APA jurisdiction over federal agencies.” Appellants’ Reply Br.
3-4.
Karst’s argument suffers from two defects which, in
combination, are fatal to its case. First, given that Macht found
insufficient federal involvement to trigger NEPA, its statement
that “[t]he reasoning of the Fourth Circuit in Gilchrist is sound”
is dictum. Thus, unlike the Fourth Circuit, we have no binding
precedent adopting the federalization theory. Second, and even
more important, at the time Gilchrist and Macht were decided,
in 1986 and 1990, respectively, we had not yet held in Public
Citizen I and II that NEPA claims must be brought pursuant to
the APA and must therefore allege “final agency action.” See
Public Citizen II, 5 F.3d at 551; Public Citizen I, 970 F.2d at
918. Indeed, then-existing case law suggested that NEPA itself
created a private right of action. For example, in Aberdeen &
Rockfish Railroad Co. v. Students Challenging Regulatory
Agency Procedures, 422 U.S. 289 (1975) (“SCRAP II”), the
Supreme Court suggested, in its first effort to interpret NEPA,
that claims under the statute might be brought independently of
the APA: “NEPA does create a discrete procedural obligation
on Government agencies . . . and a right of action in adversely
affected parties to enforce that obligation.” Id. at 319. Prior to
Macht, we too decided several NEPA cases without mentioning
11
either final agency action or the APA. See, e.g., Nat’l Wildlife
Fed’n v. Appalachian Reg’l Comm’n, 677 F.2d 883 (D.C. Cir.
1981); Calvert Cliffs’ Coordinating Comm. v. U.S. Atomic
Energy Comm’n, 449 F.2d 1109 (D.C. Cir. 1971). To be sure,
the Supreme Court issued Lujan v. National Wildlife Federation
four months prior to our decision in Macht, but because the
parties in Lujan failed to argue the issue, the Supreme Court left
open the question of whether NEPA contains a private right of
action. Lujan, 497 U.S. at 882.
Thus, although the federalization theory may have had merit
when we decided Macht, it lacks vitality today given our
decisions in Public Citizen I and II, as well as our subsequent
decisions reiterating the requirement that NEPA claims must be
brought under the APA and allege final agency action. See, e.g.,
Fund for Animals v. U.S. Bureau of Land Mgmt., 460 F.3d 13,
18 (D.C. Cir. 2006); Tulare County v. Bush, 306 F.3d 1138,
1143 (D.C. Cir. 2002); Fla. Audubon Soc’y v. Bentsen, 94 F.3d
658, 665 (D.C. Cir. 1996) (en banc). Because Karst has failed
to allege that either EPA or HUD engaged in final agency
action, we shall affirm the district court’s dismissal of the
complaint against those two agencies. Although the district
court dismissed the case for lack of subject matter jurisdiction
under Federal Rule of Civil Procedure 12(b)(1) rather than, as it
should have, for failure to state a claim under Rule 12(b)(6), “we
[can] nonetheless affirm the dismissal if dismissal [is] otherwise
proper based on failure to state a claim under [Rule] 12(b)(6).”
EEOC v. St. Francis Parochial Sch., 117 F.3d 621, 624 (D.C.
Cir. 1997); see Trudeau v. FTC, 456 F.3d 178, 184 (D.C. Cir.
2006) (explaining that “the APA’s final agency action
requirement is not jurisdictional”). And because nothing in the
APA authorizes claims against nonfederal entities, see 5 U.S.C.
§ 702 (authorizing judicial review of “agency action”); 5 U.S.C.
§ 701(b)(1) (defining an “agency” as “each authority of the
Government of the United States”); see, e.g., Sw. Williamson
12
County Cmty. Ass’n v. Slater, 173 F.3d 1033, 1035 (6th Cir.
1999) (“By its own terms, the APA does not apply to state
agencies.”), we shall affirm the district court’s dismissal of the
complaint against local intervenors.
The remaining defendant, TVA, did undertake final agency
action by making the $500,000 grant to Metalforming. But the
district court, noting that TVA had awarded the grant in 2004,
months before Karst filed its complaint, concluded that “[a]
claim that the defendants violated . . . NEPA is moot when the
action complained of has been completed and no effective relief
is available.” Karst, 403 F. Supp. 2d at 82. Responding to
Karst’s argument that the injury was capable of repetition yet
evading review because TVA might award future grants to
Transpark tenants, the district court explained that Karst’s claim
was moot when filed and that “the mootness exception for
disputes capable of repetition yet evading review . . . will not
revive a dispute which became moot before the action
commenced.” Id. (quoting Renne v. Geary, 501 U.S. 312, 320
(1991)).
Karst insists that effective relief remains available because
TVA can impose measures on Metalforming to mitigate any
environmental harm caused by the electrical equipment paid for
by the agency’s grant. See Vieux Carre Prop. Owners,
Residents, & Assocs., Inc. v. Brown, 948 F.2d 1436, 1446 (5th
Cir. 1991) (holding that a suit challenging a federally funded
project that has been completed is moot “only if [the agency]
presents evidence that compliance with the historical review
process . . . could not minimize any of the adverse effects on
[plaintiffs]”). Although TVA explains that it “simply has no
authority under the grant or under any statute to perform the
ongoing mitigation measures that Appellants suggest would
make this a live controversy,” Appellee TVA’s Br. 18, Karst
implies that the TVA Valley Advantage contract may give the
13
agency authority to impose such mitigation measures. We say
“implies” because, according to Karst, since the contract is not
part of the record and TVA failed to supply it in response to a
FOIA request, “[it] do[es] not know whether there are terms and
conditions of the agreement itself that provide an independent
contractual re-opener.” Appellants’ Reply Br. 22.
If TVA actually has authority—whether by statute,
regulation, contract, or otherwise—to impose mitigation
measures upon Metalforming, Karst’s claim might well remain
justiciable. See Vieux Carre, 948 F.2d at 1446. But Karst’s
complaint does not allege that TVA has such authority; indeed,
the complaint never even mentions the Valley Advantage
contract. Although Karst suggested in a memorandum
supporting its opposition to the motion to dismiss that TVA
could impose mitigation measures on Metalforming, it failed to
identify any basis for such remediation, stating only that the
district court “should redress the TVA . . . violations . . . by
investigating the terms of the grant to . . . Metalforming to
determine if TVA has imposed or can impose any environmental
mitigation measures on the recipient of TVA funds.” Mem. in
Support of Resp. to Mot. to Dismiss 39. We need not decide
whether this was sufficient to raise the issue, for Karst has
forfeited the argument on appeal. Although Karst referred to the
Valley Advantage contract in its opening brief, not until its reply
brief did it mention its inability to obtain a copy of the contract
or argue that the contract provides a basis for remediation. This
was too late, see PDK Labs, Inc. v. U.S. Drug Enforcement
Admin., 438 F.3d 1184, 1196 (D.C. Cir. 2006) (explaining that
reference in opening brief to factual basis for an argument not
raised until reply brief does not properly raise the argument), as
was its vague assertion, also in its reply brief, that “TVA’s
NEPA procedures and the applicable rules suggest that TVA
may be able to exercise its authority over some ongoing and
completed projects.” Appellants’ Reply Br. 21. See Rollins
14
Envtl. Servs. v. EPA, 937 F.2d 649, 652 n.2 (D.C. Cir. 1991)
(“Issues may not be raised for the first time in a reply brief.”).
III.
For the reasons given above, we affirm the district court’s
dismissal of the complaint as to all defendants.
So ordered.