INTRODUCTION

The consistency provisions of Section 307 of the Coastal Zone Management Act (CZMA, 16 U.S.C. 1456) comprising the federal consistency doctrine have become wellknown in recent years because of several highly-publicized controversies between state coastal managers and environmental organizations, on one side, and federal officials and industry, on the other, concerning sizable projects involving offshore oil and gas, at-sea incineration, and the disposal of dredge spoils. Unfortunately, the size and costs of these large scale coastal and ocean projects and the conflicts they have generated have tended to overshadow other elements of the federal-state consistency review process. Through many years, state and federal agency staff as well as applicants for federal permits have routinely used the consistency process to facilitate the successful review of thousands of projects affecting coastal resources and uses.'

Despite the fact that the consistency provisions of the CZMA have become generally known among the interests and actors concerned with coastal and ocean resource management, misunderstanding of the elements of the doctrine persisted, and more seriously, federal and state officials continued to disagree about its legal status throughout the 1980s. Much of this misunderstanding and uncertainty, especially with respect to the activities of federal agencies, including the conduct of offshore oil and gas lease sales by the Department of the Interior (DOI), has been resolved as a result of the 1990 amendments to the CZMA, as discussed more fully below.

This chapter 1) considers the role of the federal consistency provisions, as amended by the Coastal Zone Act Reauthorization Amendments of 1990 in the context of the national coastal zone management program; 2) briefly describes the consistency appeals that have been decided by the Secretary of Commerce, and 3) examines the implementation of the consistency provisions by the states. As appropriate, the chapter addresses the legal issues described above.

THE ROLE OF FEDERAL CONSISTENCY IN COASTAL MANAGEMENT

One very important, although often overlooked, aspect of the CZMA is its voluntary nature. Because states are not required to establish coastal management programs, their participation had to be secured by offering them 1) substantial federal financial assistance and 2) the promise that, if the states underwent the complicated program development and approval process prescribed in the federal Act to establish legally-enforceable standards and procedures to protect the coastal zone and its resources, federal agencies and permittees engaged in activities affecting the coastal zone would act consistently with such standards. This "promise" is of course the heart of the federal consistency provisions of the CZMA.

However, the federal consistency provisions are not so much an "incentive” to secure state participation, but an essential and significant component of a national program dependent upon state authority to protect coastal resources from the consequences of thousands of projects affecting such resources either conducted or permitted by federal agencies. Thus, rather than an afterthought added to the main features of the CZMA, federal consistency should be seen an integral part of national coastal management policy necessary to ensure its success. It is the single mechanism in the CZMA to ensure that the federal government itself obeys the law with respect to proper management of the coastal zone and its resources.

THE CONSISTENCY PROCESS

The consistency review process applicable to the categories of federally-conducted, permitted, and assisted activities is discussed following.

Federal Agency Activities

Under Section 307(c)(1) of the CZMA, as amended (1990), activities conducted by federal agencies either "within or outside the coastal zone" that affect “any land or water use or natural resource of the coastal zone" must be carried out in a manner which is consistent "to the maximum extent practicable” with “the enforceable policies of approved state management programs." Section 307(c)(2) of the CZMA, applicable to federally conducted development projects "in the coastal zone" was amended to require compliance with "enforceable" state policies. Finally, the 1990 amendments clarify that all federal agency activities are subject to the provisions of Section 307(c)(1) unless they are subject to the provisions of Section 307(c)(2) (federal development projects in the coastal zone) or (c)(3) (federally permitted activities).

This category of activities proved to be the most controversial. For example, the DOI and the oil and gas industry during the late 1970s and 1980s opposed state claims to review oil and gas lease sales under the Outer Continental Shelf (OCS) Lands Act (43 U.S.C. 1801 et seq.) for consistency with state policies protective of coastal resources and uses thought to be affected by subsequent exploration and development activities on the leased tracts. In 1984, a sharply divided Supreme Court decided, based on a reading of the legislative history concerning the phrase "directly affecting" in section 307 (c)(1), that leasing of oil and gas tracts on the outer continental shelf offshore central California were not subject to state review under the CZMA even when the State objected to leasing of tracts located in or near sensitive marine habitat areas (Secretary of the Interior v. California, 1984). This decision has now been overturned by the 1990 amendments.

Despite the 1984 decision, the National Oceanic and Atmospheric Administration (NOAA) continued to interpret Section 307 (c)(1) to apply to the activities of federal agencies if they "directly affected" the coastal zone, regardless of the location of such activities. But other federal agencies including the Environmental Protection Agency (EPA) and the Army Corps of Engineers (COE) argued, on the basis of the 1984 decision, that their activities were precluded from state review, regardless of any effects on coastal resources and uses, if such activities occurred outside the boundaries of the coastal zone or if they are exempted by federal law." In view of the 1990 amendments, these arguments are groundless.

Apart from disputes about the geographical scope of Section 307(c)(1) and whether certain federal activities are included under the section, there were relatively few disagreements between the states and federal agencies concerning other requirements of this section during the 1980s. For example, no serious questions have yet been raised about the process requirements of state review of federal agency activities or about the meaning of the phrase consistent "to the maximum extent practicable." With respect to the procedural requirements of Section 307(c)(1), it was agreed that federal agencies initially determined whether their activities “directly affected” a state's coastal zone (33 F.C.R. 930.33). Although the 1990 amendments deleted the qualifier "directly" from the phase "directly affecting," and clarified that the "effects" of interest are those on "any land or water use or natural resource of the coastal zone," it is clear that the burden remains on federal agencies to make the initial determination of the effects of their activities. A state coastal agency, however, may object to the determination by the federal agency, and, if the disagreement cannot be resolved informally or through mediation by the Secretary of Commerce, the state may seek to enjoin the federal agency from carrying out its activity on the ground that the activity is "inconsistent" with the state program (15 C.F.R. 930.116).

The 1990 amendments provide another mechanism to resolve disputes between federal agencies and coastal states under (c)(1). After a "final judgment" of a federal court "that a specific federal agency activity is not in compliance "with the provisions of 307(c)(1)(A), and if the Secretary certifies that mediation will not resolve the dispute, the Secretary may request the

President, in writing, to exempt from compliance "those elements of the Federal agency activity that are found by the Federal court to be inconsistent with an approved state program..." The President may authorize such an exemption if he finds that the activity "is in the paramount interest of the United States." The President, however, may not base any exemption on the ground of the lack of appropriations unless the President specifically requested such appropriations and Congress failed to make them (Section 307(c)(1)(B)). The 1990 amendments further clarify that federal agencies must provide consistency determinations to control states no later than 90 days before final approval of the federal agency activity unless both the federal and state agencies agree to a different schedule (Section 307(c)(1)(C)).

The few attempts to mediate (c)(1) consistency disputes between state and federal agencies have been unsuccessful, indicating at least a partial failure in the consistency review process envisioned by the Congress (NOAA, 1985). But no serious legal challenge to the other elements of this process has yet been brought; the federal court cases decided to date have all concerned challenges to the state's right under the CZMA to review a particular federal agency activity rather than challenges to aspects of the Section (c)(1) consistency review process (Eichenberg and Archer, 1987). In view of the 1990 amendments, the state's review authority under (c)(1) is no longer open to question.

With respect to the meaning of the phrase consistent "to the maximum extent practicable”—the standard of compliance with state policies that federal agencies must meet-— NOAA and the coastal states have enforced the longstanding rule (since 1979) requiring federal agency activities to be "fully consistent" with state policies "unless compliance is prohibited based upon the requirements of existing law applicable to the Federal agency's operations" (15 C.F.R. 930.32(a)). The 1990 amendments do not affect this longstanding standard of compliance; indeed, they may be needed to support the existing standard.

In spite of the several, serious disputes between state and federal agencies concerning the consistency of particular federal activities with state coastal policies, little attention has been given until 1990 to clarifying the legal theory supporting state consistency review of federal agency activities under Section 307(c)(1). Some have argued that state exercise of federal consistency authority is "unconstitutional" or otherwise illegal, because the states have invaded the dominion of federal agencies committed to them by federal law and the Constitution (Whitney, et al., 1988). These arguments fail to consider that, in enacting Section 307 (c)(1) of the CZMA, Congress in effect waived the sovereign immunity of federal agencies with respect to activities affecting the coastal areas and resources--a technique to achieve legislative purposes that Congress has employed in many similar instances and required federal agencies to subject themselves to the substantive and procedural standards of state coastal and environmental law. The 1990 amendments clarify the conditions of the 1972 waiver of sovereign immunity by incorporating a Presidential exemption mechanism with respect to inconsistent federal agency activities that are determined to be in the nation's "paramount interest". This language closely parallels the provisions of other federal law waiving the community of federal agencies vis-a-vis state substantive and procedural requirements (Archer, 1989).

Federally-Permitted and Assisted Projects and Activities

Under Section 307(c)(3)(A) and (B), federally-permitted activities, either "in or outside of the coastal zone," including outer continental shelf oil and gas exploration, development, and production activities, must be "consistent" with "enforceable" state program policies if they “affect" the land and water "uses" and resources of the coastal zone (16 U.S.C. 1456 (c)(3)(A) and (B), as amended). Permit applicants "certify" to the state that their projects are consistent with state policies; if the state determines that such projects are inconsistent, federal permits may not be issued, unless the Secretary of Commerce overrides the state's consistency

objection and authorizes the permit to be issued. (See 15 C.F.R. Subpart D, 930.50 et seq. (federal permits); Subpart H, 930.120 et seq. (administrative appeals); also see Eichenberg and Archer, 1988 for a complete description and analysis of the Section 307(c)(3) consistency review process).*

As in the case of Section 307(c)(1), OCS oil and gas activities have been the occasion for conflict between state agencies and the industry and DOI. Of the 21 consistency appeals to the Secretary of Commerce filed through 1987, 6 involved sizable exploration and development projects offshore California (Eichenberg and Archer, 1987). Although there have been disputes concerning other federally-permitted projects (10 appeals involved disputed COE permits), it is the body of early consistency appeals of state objections to offshore oil and gas projects that has helped to define the secretarial appeals process and to establish the standards according to which all consistency appeals may be decided (NOAA, 1985; Eichenberg and Archer, 1987; Archer and Bondareff, 1988). These administrative decisions have interpreted and applied the consistency appeals criteria set forth in the CZMA. The Secretary may override a state's objection after finding that the activity or project, although inconsistent with the state program, is 1) nevertheless consistent with the national objectives of the CZMA, or 2) is necessary in the interest of national security (16 U.S.C. 1456(c)(3) and (d)).

The statutory override criteria have been further defined by NOAA in its consistency regulations. To override on the first ground, the Secretary must find that the activity meets all of four separate tests:

(1) it must further one or more of the "competing national objectives" of the CZMA;

(2) its contributions to the national interest must outweigh its adverse individual and cumulative environmental impacts;

(3) it must not violate any standard under the Clean Air and Clean Water Acts, and

(4) there must be no “reasonable alternative" to the activity that would allow it to be conducted consistently with the state coastal policies (15 C.F.R. 930.121).

To override on the second ground, the Secretary must find that the activity “directly supports" national defense or other national security objectives or that such objectives, would be "significantly impaired" if the activity were not permitted to go forward as proposed (15 C.F.R. 930.122).5

The legal basis for state consistency review of applications for federal permits, and of proposed federal financial assistance projects, may be set forth briefly. Congress, which possesses sufficient authority under the U.S. Constitution to enact legislation regulating such areas as water quality, offshore energy exploration and production, and the filling of wetlands, may delegate to the states all or any part of such authority. As is well understood, such delegations have occurred under the Clean Water and Air Acts, as well as other federal laws.

Although federal agencies and some legal writers have argued that the CZMA does not authorize the states to impose requirements on applicants for federal permits in addition to those imposed by other federal law (Whitney, et al., 1988), it is clear that the CZMA's consistency provisions (Section 307 (c)(3)) are in fact a delegation of authority by the Congress to the states, and that states may effectively prohibit the issuance of federal permits for activities that are inconsistent with state program policies developed under the CZMA and approved by the Secretary of Commerce.