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Clark v. U.S. Dep't. of Agriculture: AGRICULTURE | ENVIRONMENT - plaintiff violated wetlands protection law; agency interpretation of terms

1The Honorable Robert W. Pratt, Chief Judge, United States District Court for
the Southern District of Iowa.
United States Court of Appeals
FOR THE EIGHTH CIRCUIT
___________
No. 07-3127
___________
Dorothy L. Clark, **
Plaintiff - Appellant, *
* Appeal from the United States
v. * District Court for the Southern
* District of Iowa.
United States Department of *
Agriculture; Mike Johanns, Secretary, *
*
Defendants - Appellees. *
___________
Submitted: April 15, 2008
Filed: August 12, 2008
___________
Before LOKEN, Chief Judge, JOHN R. GIBSON and MELLOY, Circuit Judges.
___________
MELLOY, Circuit Judge.
Appellant Dorothy L. Clark appeals the district courts1 refusal to grant a
declaratory judgment and set aside a United States Department of Agriculture (USDA)
determination that she converted wetlands in violation of the Swampbuster provisions
of the Food Security Act of 1985, codified as amended at 16 U.S.C. 3801, 3821-24
(2000). Because the USDA determined she had converted wetlands, Clark became
ineligible for certain farm program payments. Clark challenges the USDAs
-2-
interpretation of the term converted wetland and argues the evidence is insufficient
to support the USDAs determination that she converted wetlands. In addition, she
challenges a USDA regulation that placed the burden on her to request, and prove her
eligibility for, a minimal effect exemption. Given the deference we owe to the
USDAs regulation, its interpretation of the applicable law, and its factual
determinations, we affirm the district courts denial of relief.
I. Background
The Swampbuster provisions authorize the USDA to make determinations as
to whether certain lands qualify as wetlands and whether wetlands that have been
manipulated qualify as converted wetlands. 16 U.S.C. 3801(a)(6) & (18) (defining
converted wetland and wetland, respectively); id. 3821(e), 3822 (authorizing
the USDA to make such determinations). To deter the conversion of wetlands, a
person determined to have converted wetlands may become ineligible to receive farm
program payments. 16 U.S.C. 3821(c). An exception to the ineligibility provision
exists for manipulations determined to have only a minimal effect upon wetland and
biological functions. 16 U.S.C. 3822(f). The case below involved wetlands
determinations, converted wetlands determinations, and the minimal effect exemption.
The present appeal involves only the converted wetlands determinations and the
minimal effect exemption.
Dorothy Clark owns a farm in Boone County, Iowa. She does not actively work
her farm, but with the assistance of her son, she makes decisions regarding the farm
and leases the farm to a tenant. A creek running through the farm forms a series of
oxbows that previously served as pasture ground. In an effort to increase income from
the farm, Clark and her son decided to convert the pasture ground for use in row
cropping. Neither Clark nor the USDA alleges that the tenant was involved in the
decision to manipulate the land or in any subsequent manipulations to the land.
2The letter clearly stated that Clark was not to fill, level, or clear the oxbows
identified as wetlands:
In order to maintain your USDA program eligibility and comply with the
Clean Water Act, contact us prior to performing the following activities:
Land clearing
Drainage (tile or open ditching)
Drainage maintenance
Filling, leveling, or dredging
Land use changes
Any activity involving other waters of the United
States as defined above
3The language in the letter relevant to permits was as follows:
This project may qualify for Corps of Engineers (COE) Engineering
permit exemption under the wetland conservation provisions of the Food
Security Act. You must pursue your next action with the COE to obtain
a Clean Water Act (CWA) Section 404 permit. As part of the process
you may also be required to obtain CWA Section 401, Water Quality
Certification from the Iowa Department of Natural Resources (IDNR).
. . . Upon receipt of a copy of the COE permit, NRCS will be able to
-3-
On November 18, 2002, Clarks son sought a wetlands determination from the
Natural Resource Conservation Service, an agency within the USDA. After repeated
visits, Jared Finley, a district conservationist, determined that eight sites in the area
of the oxbows contained a total of five acres of wetlands. In an April 16, 2003 letter,
Finley set forth his technical determination and notified Clark she was not to
manipulate the wetlands without first contacting the USDA.2 In addition, the letter
indicated that certain permits might be required from the United States Army Corps
of Engineers and from the Iowa Department of Natural Resources, but that any
permits should be presented to the USDA and that the USDA could inform her of her
compliance options and any available exemptions.3
proceed with issuance of a revised NRCS-CPA-026E notifying you of
your wetland conservation compliance options with USDA programs.
The appropriate Food Security Act exemptions will also be noted as well
as any further action upon your part.
(Emphasis added).
-4-
After receiving the letter, Clark contacted an attorney to seek assistance in
obtaining permits from the IDNR and the COE. The attorney eventually advised her
that the COE did not claim jurisdiction over the land in question and that the IDNR
did not require her to obtain any permits. Notwithstanding the language in Finleys
April 16, 2003 letter requesting that Clark contact NRCS prior to manipulating the
land, she proceeded to fill and level the wetlands without contacting NRCS.
On December 8, 2004, after receiving several whistleblower reports of
bulldozing activities on the Clark property, Finley met with Clarks son at the farm.
Finley observed that two of the eight sites determined to be wetlands were now filled.
In a letter dated December 10, 2004, Finley identified the filled areas and stated,
These areas met the criteria of wetlands which are hydric soils, wetland plants and
soil or surface wetness. Your manipulation by filling in on this wetland area is
considered an alteration that makes the area more farmable which is a violation of the
Swampbuster provisions . . . . Having received no request for a minimal effect
determination nor advance notification regarding the nature of Clarks proposed
manipulation of the two wetland sites, Finley conducted no minimal effect
investigation and made no minimal effect determination.
When Finleys wetlands and converted wetlands determinations became final,
Clark appealed to the County Farm Service Agency Committee and the USDAs
National Appeals Division, losing her appeals at each step. She then sought and was
-5-
denied review from the Director of the National Appeals Division. The Directors
denial of relief serves as the final agency action.
Clark then filed this suit in the district court. She sought a declaratory judgment
alleging the USDAs action was arbitrary, capricious, an abuse of discretion or
otherwise not in accordance with law; was in excess of statutory jurisdiction,
authority, or limitations or short of statutory rights; was without observance of
procedure as required by law, and was unsupported by substantial evidence . . . . She
argued specifically that: (1) the USDA followed inadequate procedures when making
the wetlands determination, and the evidence did not support the wetlands
determination; (2) the USDA misinterpreted the term converted wetland, the USDA
applied an improper standard in making the converted wetlands determination, and the
evidence did not support the converted wetlands determination; and (3) the USDA
was required, but failed, to conduct a minimal effect determination regarding the
manipulation of the two sites. The USDA contested each argument and also argued
that Clark failed to adequately exhaust her administrative remedies.
The court determined that Clark had adequately exhausted her administrative
remedies. The court then rejected all of Clarks arguments regarding the wetlands
determination, the converted wetlands determination, and the minimal effect
exemption. On appeal, the government does not renew its argument that Clark failed
to exhaust her administrative remedies, and Clark does not renew her arguments
regarding the wetlands determination. As such, we need not address these arguments
further nor discuss the technical details of the wetlands determination.
Some additional facts are relevant to the issue of the converted wetlands
determination. The Swampbuster provisions define a converted wetland as a wetland
manipulated for the purpose or to have the effect of making the production of an
agricultural commodity possible if-- (i) such production would not have been possible
4The full statutory definition is as follows:
(A) The term converted wetland means wetland that has been drained,
dredged, filled, leveled, or otherwise manipulated (including any activity
that results in impairing or reducing the flow, circulation, or reach of
water) for the purpose or to have the effect of making the production of
an agricultural commodity possible if--
(i) such production would not have been possible but for such
action; and
(ii) before such action--
(I) such land was wetland; and
(II) such land was neither highly erodible land nor highly
erodible cropland.
(B) Wetland shall not be considered converted wetland if production of
an agricultural commodity on such land during a crop year--
(i) is possible as a result of a natural condition, such as
drought; and
(ii) is not assisted by an action of the producer that destroys
natural wetland characteristics.
16 U.S.C. 3801(a)(6).
-6-
but for such action . . . . 16 U.S.C. 3801(a)(6)(A)4. Clark relied upon the statutory
language possible and not have been possible and argued that the USDA erred by
determining the two wetlands she filled were converted wetlands without first proving
the wetlands pre- and post-manipulation capability to support the production of an
agricultural commodity. Id. In making this argument, Clark urged the court to
interpret the word possible in a strict manner such that a wetland is not a converted
wetland if it is capable of supporting any quantity or quality of agricultural
commodity production. She also urged the court to find that the USDA had a duty to
prove the wetlands could not support the production of agricultural commodities prior
to the manipulation but could support such production after the manipulation. She
argued that the USDA merely presented evidence showing that agricultural
5Clark asserts that agricultural commodities grew on the now-filled wetlands
in the past, prior to her filling the wetlands. In support of this assertion, however, she
cites only to Finleys inconclusive testimony regarding hearsay reports of attempting
cropping. Finleys testimony was as follows:
A. The only evidence I can show is that during certification of
agriculture commodity that piece has never been farmed and they
did try to farm it. Prior to converting it actually the operator did
drive through there and try to plant agriculture commodity. What
he produced I cannot answer that.
Q. In fact, what knowledge you do have is that there was production
in there, you just dont know what the results were; is that correct?
A. Correct. He drove through it and thats prior to converting it or
leveling it, filling it.
-7-
commodities had not been grown on the two sites, not that agricultural commodities
could not have been grown on those sites.
Evidence relevant to the production of agricultural commodities included aerial
photographs from 1985 on. These photographs showed no cropping on any of the
eight wetlands prior to the bulldozing activity and no cropping on the six unfilled
wetlands after the bulldozing activity. The photographs did show cropping on the two
filled wetlands after the bulldozing activity. Further, Clark admitted in her filings
before the district court that her purpose in manipulating the land was to convert the
land from use as a pasture to use for growing agricultural commodities. Finally,
Finley testified that he was told someone had attempted to grow agricultural
commodities on the two now-filled wetlands at some point in the past, before Clark
filled the wetlands. He had no information, however, regarding the success of those
efforts.5
The district court presented several bases for rejecting Clarks arguments. First,
the court rejected Clarks request to apply a strict, literal definition for the statutory
6The relevant portion of the statutory provision is as follows:
(f) Minimal effect; mitigation
The Secretary shall exempt a person from the ineligibility provisions of
section 3821 of this title for any action associated with the production of
an agricultural commodity on a converted wetland, or the conversion of
a wetland, if 1 or more of the following conditions apply, as determined
by the Secretary:
(1) The action, individually and in connection with all other similar
actions authorized by the Secretary in the area, will have a minimal
-8-
term possible. Instead, the court accepted the USDAs position that a practical
interpretation should apply to the statutory term possible, i.e., manipulations to
wetlands that make the wetlands more suitable for farming qualify as the conversion
of wetlands. Second, the court rejected Clarks argument that the USDA was required
to prove that the wetlands, post-manipulation, could produce agricultural
commodities. The court emphasized that the statute prohibits manipulations for the
purpose or to have the effect of making the production of an agricultural commodity
possible. Id. (emphasis added). Finally, the court found the evidence the USDA
relied upon sufficient to support the agencys action because the evidence
demonstrated clearly that the purpose of the manipulations was to make the two
wetlands more suitable for cropping, and there was no evidence of prior successful
cropping on the manipulated wetlands.
Clarks argument regarding a minimal effect exemption was legal in nature.
Clark argued that the USDA has an obligation in all cases to conduct a minimal effect
investigation and issue a minimal effect determination. She argued that the USDA
always bears the burden of proving a manipulation has more than a minimal effect.
In fact, the relevant statutory provision does not state whether the USDA or the
landowner bears the burden to prove eligibility for a minimal effect exemption.6 The
effect on the functional hydrological and biological value of the wetlands
in the area, including the value to waterfowl and wildlife.
16 U.S.C. 3822.
-9-
USDA, however, issued a regulation that places the burden of proof on the landowner
if the landowner converts a wetland without first asking the USDA to make a minimal
effect determination. As noted above, Clark did not request such a determination prior
to her manipulation of the wetland. Also, Clark did not present any evidence on the
issue of whether her manipulations had more than a minimal effect. Given this
posture, Clarks challenge was a facial challenge to the validity of the USDAs
burden-assigning regulation. The district court rejected Clarks argument, finding that
the USDAs burden-assigning regulation was consistent with, and a permissible
construction of, the statute.
II. Discussion
A. Standard of Review
We review the district courts judgment de novo. Cent. S.D. Coop. Grazing
Dist. v. Secy of the U.S. Dept of Agric., 266 F.3d 889, 894 (8th Cir. 2001). Like the
district court, however, we review the USDAs action under a deferential standard.
Id. We will not disturb the USDAs action unless it was arbitrary, capricious, an
abuse of discretion, or otherwise not in accordance with law, 5 U.S.C. 706(2)(A),
or in excess of statutory jurisdiction, authority, or limitations, or short of statutory
right, id. 706(2)(C). See 7 U.S.C. 6999 (A final determination of the Division
shall be reviewable and enforceable by any United States district court of competent
jurisdiction in accordance with chapter 7 of Title 5.).
-10-
This case turns largely on questions of statutory interpretation. [W]hen an
agency invokes its authority to issue regulations, which then interpret ambiguous
statutory terms, the courts defer to its reasonable interpretations. Fed. Express Corp.
v. Holowecki, 128 S. Ct. 1147, 1154 (2008); see also Chevron U.S.A., Inc. v. Natural
Res. Def. Council, Inc., 467 U.S. 837, 843-45 (1984). We have interpreted this
deference as amounting to controlling weight unless [the regulation is] arbitrary,
capricious, or manifestly contrary to the statute. Friends of Boundary Waters
Wilderness v. Bosworth, 437 F.3d 815, 822 (8th Cir. 2006) (quoting In re Old
Fashioned Enters., 236 F.3d 422, 425 (8th Cir. 2001)). When an agencys
interpretation of a statute is presented in a less formal manner that does not appear
to have the force of law, however, it is not entitled to this high level of deference.
St. Marys Hosp. v. Leavitt, 416 F.3d 906, 914 (8th Cir. 2005) (quoting Christensen
v. Harris County, 529 U.S. 576, 587 (2000)). In such circumstances, the agency
interpretation is entitled to respect to the extent it has the power to persuade. Id.
(internal quotation omitted). As the Supreme Court recently articulated:
Assuming these interpretive statements are not entitled to full Chevron
deference, they do reflect a body of experience and informed judgment
to which courts and litigants may properly resort for guidance.
Bragdon v. Abbott, 524 U.S. 624, 642 (1998) (quoting Skidmore v. Swift
& Co., 323 U.S. 134 (1944)). As such, they are entitled to a measure of
respect under the less deferential Skidmore standard. Alaska Dept. of
Environmental Conservation v. EPA, 540 U.S. 461, 487, 488 (2004);
United States v. Mead Corp., 533 U.S. 218, 227-239 (2001).
Fed. Express Corp., 128 S. Ct. at 1156.
B. Converted Wetlands
As noted, the dispute regarding the USDAs converted wetlands determination
centers on the word possible as used in the phrases making the production of an
agricultural crop possible and such production would not have been possible. 16
-11-
U.S.C. 3801(a)(6)(A). Clark argues for a strict definition of the term possible that
would exempt from Swampbuster protection any land upon which any quantity or
quality of agricultural commodity could have been grown prior to manipulation. The
USDA interprets the term possible in a practical sense, treating as conversion those
actions that make a wetland more suitable for growing agricultural commodities. See
National Food Security Act Manual 514.20(d) (3d ed., amend. 4, Sept. 1999)
(Making production possible means manipulation: which allows . . . production of
an agricultural commodity where such production was not previously possible, or
making an area farmable more years than previously possible, or which reduces crop
stress and allows increased crop yields . . . .). The USDAs position also is reflected
in Finleys December 10, 2004 letter to Clark in which he stated, Your manipulation
by filling in on this wetland area is considered an alteration that makes the area more
farmable which is a violation of the Swampbuster provisions. (Emphasis added).
If the plain language of the statute is unambiguous, that language is conclusive
absent clear legislative intent to the contrary. Therefore, if the intent of Congress can
be clearly discerned from the statutes language, the judicial inquiry must end.
United States v. McAllister, 225 F.3d 982, 986 (8th Cir. 2000) (internal quotation
omitted). In reviewing statutory language, we do not read individual words in
isolation, but rather, we read them in the context in which they are used and in the
context of the statute as a whole. In re Benn, 491 F.3d 811, 814 (8th Cir. 2007). Read
in isolation, the term possible might appear unambiguous, and Clarks strict
interpretation might seem appropriate. We believe, however, that read in context, the
phrases containing the word possible are ambiguous. The phrases describe the
production of agricultural commoditiescommercial biological processes in which
success might be measured by several different standards, for example, strictly in
terms of technical growth or in terms of commercial feasibility.
As aptly noted by the district court, Clarks position, if accepted, would exclude
from protection all wetlands that were in any measure farmable prior to manipulation.
-12-
The USDA described Clarks position as follows, [Clarks] construction would mean
that, if the land could have occasionally produced one stunted ear of corn or pod of
soybeans prior to being filled, there could be no conversion of a wetland triggering the
[16 U.S.C.] 3821 bar on participation in federal farm programs. Appellees brief
at 17. We agree that such a result would be absurd as it would remove from
protection vast areas of wetlands. We find no suggestion in the Swampbuster
provisions that Congress intended to exclude from protection all wetlands that might
support some de minimis growth of agricultural commodities. Further, such an
interpretation would be inconsistent with the general purpose of the statute, which we
previously recognized as an effort to combat the disappearance of wetlands through
their conversion into crop lands . . . . Gunn v. U.S. Dept of Agric. 118 F.3d 1233,
1235 (8th Cir. 1997).
In addition, Clarks preferred interpretation would render the language of 16
U.S.C. 3801(a)(6)(B)(ii) superfluous. That subsection provides that a wetland is not
considered a converted wetland if natural conditions (e.g. drought) permit the
occasional production of an agricultural commodity not assisted by an action of the
producer that destroys natural wetland characteristics. Id. Clarks interpretation of
the term possible would necessarily exclude from the definition of converted
wetlands any and all wetlands that might from time to time be production-capable
regardless of whether or not a manipulation to the land destroys natural wetland
characteristics. Id. Under Clarks view, a categorical exemption would precede and
render superfluous the manipulation limitation contained in 3801(a)(6)(B)(ii).
The USDAs interpretation of the term possible, as reflected in Finleys letter
and in the National Food Security Act Manual, is not contained in a regulation born
of the rulemaking process, and does not appear to have the force of law. St. Marys
Hospital, 416 F.3d at 914 (internal quotations omitted). As such it is not entitled to
the high level of deference afforded under the rule of Chevron, 467 U.S. at 843-45.
Nevertheless, the interpretation arises from the agencys application of its
-13-
technological expertise based on a body of experience and informed judgment and
is therefore entitled to respect. Skidmore, 323 U.S. at 140. For the reasons set forth
above, we believe the USDA acted within its authority in interpreting an ambiguous
statutory term, and we find the USDAs interpretation to be a persuasive, practical,
and permissible interpretation of the statute.
Applying this definition, it is beyond dispute that Clark manipulated the
wetlands in question for the purpose of making the production of an agricultural
commodity more feasible. She admitted this in her court filings and in a January 1,
2005 letter to the COE. Because the definition of the term converted wetland
focuses on purpose or effect in the alternative, the USDA was not required to
prove that Clark, through manipulation of the wetlands, was successful in her efforts
to make the production of an agricultural commodity possible. 16 U.S.C.
3801(a)(6)(A).
C. Minimal Effect
Where there is a showing that the manipulation of a wetland has only a minimal
effect, the agency is not to impose the ineligibility consequences otherwise applicable
under the Swampbuster provisions of the Food Security Act. 16 U.S.C. 3822(f),
supra at n.6. The statute, however, is silent and therefore ambiguous as to whether the
agency or the landowner bears the burden of proving minimal impact as to any given
piece of land.
77 C.F.R. 12.31(d) provides:
Minimal effect determination. For the purposes of 12.5(b)(1)(v) of this
part, NRCS shall determine whether the effect of any action of a person
associated with the conversion of a wetland . . . has a minimal effect on
the functions and values of wetlands in the area. Such determination
shall be based upon a functional assessment of functions and values of
the wetland under consideration and other related wetlands in the area,
and will be made through an on-site evaluation. A request for such
determination will be made prior to the beginning of activities that
would convert the wetland. If a person has converted a wetland and then
seeks a determination that the effect of such conversion on wetland was
minimal, the burden will be upon the person to demonstrate to the
satisfaction of NRCS that the effect was minimal.
(Emphasis added).
-14-
Filling this void, the USDA passed a regulation7 clear in its requirement that a
landowner must consult with the USDA prior to manipulating a wetland or face the
consequence of bearing the burden to prove the manipulations have only a minimal
effect. The USDA argues its regulation is reasonable, because after manipulation, it
would be substantially more difficult and technically challenging for the agency to
prove what the wetlands function or value might have been prior to alteration (as
would be required as a basis for comparison to the wetlands function and value of the
site after manipulation). Recognizing this technical challenge, the USDA argues it has
reasonably imposed a duty on the landowner to request a determination in advance of
any manipulation or to bear the burden of proof as a consequence of not seeking a prealteration
determination.
Clark notes that Congress amended 16 U.S.C. 3822(f) in 1990, replacing the
phrase The Secretary may exempt, with the phrase The Secretary shall exempt.
Pub. L. 101-624, Title XIV, 1422, Nov. 28, 1990, 104 Stat. 3573. Clark argues
generally that this amendment reflects a legislative desire to curb perceived resistance
-15-
from the USDA towards issuing such exemptions. We do not disagree with this
general statement: the amendment clearly deprives the USDA of discretion where
discretion previously existed, and following the 1990 amendment the USDA must
grant such exemptions where a manipulation is shown to have a minimal effect.
The statute, even as amended, however, does not apportion the burden of proof
regarding the technical determination of whether a manipulation has more than
minimal effect. Nor does it contain any language suggesting the USDA is without
authority to impose a burden of proof upon landowners who fail to request a
determination prior to taking action likely to hinder the USDA in its assessment of the
wetlands pre-manipulation function and value. In fact, Congress remained silent as
to the burden of proof and as to the requirement that a landowner request a minimal
effect determination even though the USDA had adopted the final rules addressing
these issues several years prior to Congresss amendment of the statute. See 52 F.R.
35194-01 (Sept. 17, 1987) (adopting the regulation now contained in 7 C.F.R.
12.31(d)).
Further, the statute, both before and after amendment, refers to a manipulation
as having a minimal effect individually and in connection with all other similar
actions authorized by the Secretary in the area . . . . 16 U.S.C. 3822(f)(1). This
language appears to presume that any action subject to a minimal effect exemption
would have been reviewed and authorized in advance by the USDA, not examined
after the fact. At a minimum, this language suggests a statutory scheme consistent
with Finleys letter, i.e., a scheme in which landowners notify the USDA in advance
of their planned manipulations. Under such a scheme, it would be more technically
feasible to conduct the before-and-after investigations necessary to make a minimal
effect determination. Given these several bases for support and the high level of
deference we owe to the agencys interpretation of the statute as set forth in the
regulation, we must reject Clarks challenge.
-16-
Finally, to the extent Clark argues that the USDA failed to provide adequate
procedures for informing and inviting landowners to request minimal effect
determinations, her arguments are without merit. As quoted above, Finleys April 16,
2003 letter clearly instructed Clark not to fill the wetlands, notified her that the
USDAs Natural Resource Conservation Service would inform her of her compliance
options, and stated, The appropriate Food Security Act exemptions will also be noted
as well as any further action upon your part. The information provided to Clark,
then, clearly anticipated further interaction with the USDA including an opportunity
to address the availability of exemptions and compliance options for any proposed
actions. Clarks unilateral action preempted this opportunity for information
exchange and undercuts her procedural arguments.
III. Conclusion
We affirm the judgment of the district court.
______________________________
 

 
 
 

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