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Borough of Avalon v. United States Army Corps of Engineers

United States District Court, D. New Jersey

September 7, 2017

BOROUGH OF AVALON, Plaintiff,
v.
UNITED STATES ARMY CORPS OF ENGINEERS and UNITED STATES DEPARTMENT OF THE INTERIOR, FISH AND WILDLIFE SERVICE, Defendants.

          DANIEL A. GREENHOUSE, ESQ. CULLEN AND DYKMAN LLP ATTORNEY FOR PLAINTIFF

          JESSICA ROSE O'NEILL, ASSISTANT U.S. ATTORNEY ATTORNEY FOR DEFENDANTS

          OPINION

          HONORABLE JEROME B. SIMANDLE JUDGE

         I. INTRODUCTION

         Plaintiff Borough of Avalon (hereinafter “Plaintiff”) brings this case against the United States Army Corps of Engineers and the United States Department of the Interior, Fish and Wildlife Service (hereinafter “Defendants”) alleging violations of § 706(2)(a) of the Administrative Procedure Act (“APA”), 5 U.S.C. § 701, et seq., specifically alleging an arbitrary and capricious interpretation of the Coastal Barrier Resources Act, 16 U.S.C. § 3501, et seq. (hereinafter, “CBRA”)[1]. Defendants move to dismiss the Complaint, arguing that Plaintiff's challenge to the application of the CBRA is moot, Plaintiff lacks standing to sue, and that Plaintiff fails to identify a final agency action subject to review by this Court. The principal issues to be decided are, for a municipality seeking injunctive and declaratory relief with respect to the Federal Defendants' interpretation of a federal funding exclusion of the CBRA concerning displacement of sand and fill for a beach replenishment project, wherein the project will go forward with funding from the State of New Jersey as to the excluded portion, whether (a) the municipality lacks standing to challenge the federal agencies' interpretation of the CBRA due to lack of harm, and (b) the controversy is moot. For the following reasons, the Court will grant Defendants' motion to dismiss.

         II. FACTUAL AND PROCEDURAL BACKGROUND [2]

         On March 28, 2002, the United States Army Corps of Engineers (hereinafter, “the Army Corps”), through the U.S. Army Engineer for the Philadelphia District, entered into an agreement with the State of New Jersey Department of Environmental Protection (hereinafter, “NJDEP”), titled the Project Cooperation Agreement Between the Department of the Army and the New Jersey Department of Environmental Protection for Construction of Townsends Inlet to Cape May Inlet, New Jersey Shore Protection Project (hereinafter, “PCA”). [Compl. ¶ 21.] The “Project” includes initial construction and periodic nourishment of shore protection features, including two beach nourishment segments at Avalon and Stone Harbor (Seven Mile Island). [Id. ¶ 23.] The Army Corps is responsible for the funding of this project, including the periodic nourishments, except for the contribution costs allocated to the Non-Federal Sponsor, the NJDEP, by the PCA. [Id. ¶¶ 26-8.] A Feasibility Study, [3] approved by the Chief of Engineers on September 28, 1998, indicates such periodic nourishments should occur every three years over the course of the 50-year Project. [Id. ¶ 29.][4]Initial construction for the Project was completed in 2002, and the first partial periodic nourishment was completed in 2011. [Id. ¶ 38.] On February 5, 2013, Plaintiff entered into an agreement with NJDEP titled the State Aid Agreement Between the Department of Environmental Protection and the Borough of Avalon for Construction of the Townsends Inlet to Cape May Inlet, New Jersey Shore Protection Project Second Partial Renourishment Cycle 2012 Emergency PL 84-89 Funds Project Number 6036-R2-12 (hereinafter, “State Aid Agreement”). [Id. ¶ 37.]

         On June 7, 2016, the United States Army, on behalf of Defendant Army Corps, posted a Presolicitation Synopsis for the second phase of the periodic nourishment for the Project relating to Plaintiff Avalon as well as the Borough of Stone Harbor. [Compl. ¶ 43.] The actual solicitation was posted by the Army Corps on July 7, 2016, with bids opening August 17, 2016 and set to expire October 16, 2016. [Id. ¶¶ 44, 47]. The two top bidders agreed to extend this window through December 15, 2016. [Rourke Decl. ¶ 15.][5]

         This delay in bid acceptance appears to have been caused primarily by Defendant Army Corps requesting Defendant United States Department of the Interior, Fish and Wildlife Service (hereinafter, “Fish and Wildlife Service”) to advise on July 28, 2016 whether the CBRA precluded use of federal funds for the project because Hereford Inlet is within the Coastal Barrier Resources System (hereinafter, “CBRS”) protected under the CBRA. [Compl. ¶¶ 49-50.] The Fish and Wildlife Service advised in a letter sent August 9, 2016 that exceptions to the CBRA limitation on federal funding for projects involving CBRS units are not applicable to this phase of the Project.[6] [Ex. G of Compl.] The Army Corps requested a separate solicitor review of the applicability of the exception in an email and memorandum sent to the Fish and Wildlife Service on September 15, 2016, which the Fish and Wildlife Service denied on September 27, 2016. [Ex. H of Compl.] Plaintiff also sought review of the decision to prohibit funding by directly reaching out to the Fish and Wildlife Service on October 13, 2016, resulting in a reply from the Fish and Wildlife Service on October 14, 2016. [Compl. ¶ 55.] In its reply, the Fish and Wildlife Service indicates that the Project is not vetoed or blocked by the CBRA but that the Fish and Wildlife Service's interpretation remained that the CBRA prohibited either the use of federal funds or the use of materials from a CBRS unit for the Project. [Id. ¶ 56; Ex. H of Compl.]

         Plaintiff commenced this litigation in October 2016 when it filed a Complaint and a motion for a temporary restraining order (“TRO”). Plaintiff's Complaint includes three counts separately alleging that (1) Defendants' interpretation of the CBRA is arbitrary, capricious, and incorrect; (2) Defendants breached an obligation to Plaintiff due to Plaintiff's reliance on the PCA; and (3) Defendants not accepting a bid is inconsistent with New Jersey's state management plan and therefore in conflict with the Coastal Zone Management Act, 16 U.S.C. § 1451, et seq. [Compl. ¶¶ 63-96.]

         An initial hearing was held regarding the TRO on November 7, 2016. [Docket Item 7.][7] The TRO hearing was ultimately set to take place January 12, 2017. [Docket Item 10.] Prior to that hearing taking place, the Army Corps and the NJDEP entered a Memorandum of Agreement (hereinafter, “MOA”) on November 28, 2016 by which the NJDEP[8] agreed to provide the funding, within fifteen days, for this phase of the Project as it relates to the CBRS unit Hereford Inlet being used to replenish Stone Harbor. [Rourke Decl., Ex. B to Def. Br.] Subsequent to this, the Army Corps awarded the contract for periodic nourishment on December 14, 2016, leading Plaintiff to withdraw its application for the preliminary injunction in a letter to the Court dated December 20, 2016. [Docket Item 13.] Plaintiff continues to seek declaratory and injunctive relief relating to Defendants' application of the CBRA. [Id.] Thereafter, in light of the bid acceptance and the NJDEP's agreement to fund the part of the project that involves borrowing sand from Hereford Inlet for Stone Harbor's beach replenishment [Rourke Decl. ¶ 16], Defendants moved to dismiss Plaintiff's Complaint under Rule 12(b)(1), Fed. R. Civ. P., for lack of jurisdiction due to lack of standing and mootness [Docket Item 15.] The Court decides this motion without oral argument pursuant to Fed.R.Civ.P. 78.

         III. STANDARD OF REVIEW

         A motion to dismiss under Fed.R.Civ.P. 12(b)(1) must be granted if the court lacks subject matter jurisdiction to hear a claim. In re Schering Plough Corp. Intron/Temodar Consumer Class Action, 678 F.3d 235, 243 (3d Cir. 2012). When a defendant files a motion under Rule 12(b)(1), the plaintiff bears the burden of establishing subject matter jurisdiction for the sake of remaining in federal court. Gould Elec., Inc. v. United States, 220 F.3d 169, 178 (3d Cir. 2000). Motions to dismiss for lack of standing or on mootness grounds are properly brought under Rule 12(b)(1) because these doctrines are jurisdictional matters. Ballentine v. United States, 486 F.3d 806, 810 (3d Cir. 2007).

         Defendants' motion presents a factual challenge to subject matter jurisdiction under Rule 12(b)(1). A factual challenge makes an argument that the facts of the case do not support the asserted jurisdiction. Constitution Party of Pa. v. Aichele, 757 F.3d 347, 358 (3d. Cir. 2014)(quoting CNA v. United States, 535 F.3d 132, 139 (3d Cir. 2008)). In a factual attack, the court may weigh and consider evidence outside the pleadings and the plaintiff's allegations. Constitution Party, 757 F.3d at 358. “[N]o presumptive truthfulness attaches to plaintiff's allegations, and the existence of disputed material facts will not preclude ...


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