Photo: Richard Sagredo/Unsplash

Scott Hamilton, President, Hamilton Resource Economics

Regulations have become increasingly intrusive in farming, increasing reporting requirements and costs. They also affect water supply as regulators struggle to protect endangered aquatic species. When the data or the science are lacking, which is usually the case, there is significant uncertainty on what level of protection is needed. Wildlife agencies, whose directive is to protect species and their habitat, typically err on the side of the species.

This approach, referred to as “the precautionary principle,” asserts that there is a need to be cautious in assessing man-made risks to the environment, especially when the scientific understanding is limited, and the potential harm is great. The basis for utilizing the Endangered Species Act (ESA) comes from a single sentence in a 1979 conference report forming part of the congressional record.

The U.S. Fish and Wildlife Service and the National Marine Fisheries Service (NMFS) include it in their Endangered Species Consultation Handbook. In giving the benefit of the doubt to the species, applying the principle typically gives little regard for social and economic consequences, such as impacts on water supplies.

This principle was scrutinized in a recent court of appeals case in Washington, D.C. The case concerned the impact that lobster fishermen in the Gulf of Maine had on the survival of North Atlantic right whales—an endangered and migratory species whose numbers had been declining during the last decade—and the subsequent regulations that were imposed by NMFS on the fishermen under the Endangered Species Act.

Right whales suffer from strikes by ships, entanglement in fishing gear, and lack of food. However, of the 47 likely deaths due to entanglement in fishing gear, only two were likely caused in the United States. The origin of the other likely deaths, and even the type of fishing gear, could not be readily determined. In applying the precautionary principle, the National Marine Fishery Service essentially said they don’t know if the lobster fishermen caused the deaths, so new fishing regulations need to be extra protective as a precaution. Those new regulations were estimated to cost $50 to $90 million over six years. The lobster fishermen and the State of Maine’s Department of Marine Resources drew exception to the NMFS determination and pursued legal action.

The three Circuit judges on the case ruled in favor of the fishermen, striking down the precautionary principle. They ruled that NMFS, when faced with uncertainty, may not give the “benefit of the doubt” to an endangered species by relying upon worst case scenarios or pessimistic assumptions.

Their ruling was notable for several reasons. First, they ruled that the Congressional directive, cited as the basis for the principle, was never included in that Act itself. If Congress had wanted it in the Endangered Species Act, they would have included it along with other safety margins in previous legislation. Second, they said the ESA employs an alternative standard— “best scientific and commercial data available.” This means using the best science that is currently available, without precautionary interpretation, and implementing regulations based on that information.

The judges said: “Nothing in Section 7 (of the ESA) requires distorting the decision-making process by overemphasizing highly speculative harms whenever the available data is wanting.”

In the case of the right whale, there was no evidence to suggest that the lobster fishermen were responsible for deaths that would have had population-level impacts. Third, they ruled that “it has been a clear precept of administrative law that an agency action may not stand if the agency has misconceived the law,” meaning NMFS had misconceived the legal relevance of the precautionary principle and that determinations based on that misconception were invalid.

The court ruling has implications for regulations in the Delta affecting water supplies, as referenced by Paul Weiland’s blog at There are broader implications for farmers in the San Joaquin Valley. The California Department of Fish and Wildlife (CDFW) is not friendly to public water agencies (PWAs) that have contracts with the State of California and the Bureau of Reclamation to receive water from Northern California. In the last permit issued by CDFW to allow water exports to continue, CDFW instituted 70 new regulations.

The scientific basis for many of the biological measures in the permit is lacking. Several measures “may” help fish, but the application of the best available science is wanting. For example, one regulation—increasing outflow during the fall of wet years to help delta smelt—has not been supported by more than a dozen studies during the last decade. But CDFW seems not to care—if the public water agencies want the water, they must comply with CDFW’s regulations. The unsavory recourse is for the PWAs to pursue legal action to protect their water supplies and the integrity of science.

Some of the most egregious measures are being opposed by PWAs. Little is known about the status of these lawsuits because, appropriately, public agencies deal with legal issues in “closed session” board meetings.

Lawsuits are expensive and time-consuming. To be successful, PWAs must also be confident that the best available science supports their position. That requires years to process because much of the research does not address the effectiveness of management regulations that have been implemented to protect aquatic species. That could be done through the rigorous implementation of a process known as “adaptive management.” Too often, agencies in Sacramento pay lip service to the process and rarely implement the necessary hypothesis formulation and monitoring required to provide definitive results.

Recognizing deficiencies in the scientific process, the Center for California Water Resources Policy and Management Committee has embarked on a science program financially supported by many water districts in Kern County, to understand the real causes of declines in endangered species. This will identify management actions that may more effectively help the species. However, there is also the need for much stronger legal support.

Unless CDFW knows that their science, when inadequate, will be challenged, water-costing regulations will persist. A decision for farmers and water districts to consider is how much to budget to fight regulations and increased water costs caused by poorly informed regulations. Bad regulations must be challenged because the regulators don’t always get it right. Just ask the lobster fishermen.

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