Federal Court Agrees that Environmental Plaintiff Has Standing to Challenge USDA Loan Guarantee
Updated: Apr 18
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Some of you may remember a previous post I wrote discussing a challenge to USDA’s Farm Service Agency (FSA) approving a loan guarantee for a poultry farm on the Maryland’s Eastern Shore. Food & Water Watch (FWW) brought the challenge, claiming FSA violated the National Environmental Policy Act (NEPA); for more background click here. Recently the federal district court denied FSA’s procedural motions, claiming FWW did not have the standing to bring the challenges and their claims were moot. The court did not touch the central claims that FSA failed to provide an adequate NEPA review before approving the federal loan guarantee for a poultry farm.
The federal district court is focused on FSA’s motions to dismiss. FSA is saying that FWW’s claims are moot and FWW does not have the standing to bring the challenge. Being moot is the idea that the issue being presented, here FSA failed to do a proper environmental review required under NEPA, can no longer be reviewed by a court because FSA no longer has control over the poultry farm. FSA is claiming that because the poultry farm is constructed and operating, FSA has no direct authority over the farm.
FWW argues that FSA will still have control over the poultry farm because of the ongoing, FSA-approved loan guarantee. The court agreed with FWW on this issue, pointing out that if the revised NEPA review required FSA to revoke the guarantee, this could jeopardize funding for the poultry farm. FSA also has regulations related to annual reviews of a borrower’s credit history and business operations, as well as regulations related to post-approval inspection and monitoring of approved projects.
The court also pointed to an earlier decision involving a hog farm in Arkansas, Buffalo River Watershed Alliance v. Department of Agriculture. In that decision, the federal district court noted that FSA could place additional conditions on the loan guarantee after revising the NEPA review. To the court, FSA could do additional environmental assessments that NEPA requires and either revoke the loan guarantee or add additional requirements to mitigate environmental issues. With an ongoing ability to provide the relief that FWW is requesting, the court found FWW’s claims were not moot.
The next issue before the court was the standing of FWW. I’ve previously written about standing; you can get the background details here. In this case, FSA argued that FWW had not proved a sufficiently concrete injury traceable to FSA’s actions and that the relief sought by FWW will not remedy the injuries. Plaintiffs have already established actual injury to FSA’s actions in this case, according to the court. An FWW member who lives nearby the poultry farm had expressed concerns about increased noises, odors, and flies, and bright lights during the night. Another FWW member highlighted concerns about fishing in a nearby creek and how possible pollution could impact restoration work the member had completed along the creek.
To the court, each injury was also traceable to FSA. Without the loan guarantee, the poultry farm could not have been built. The loan guarantee provided the necessary credit for a commercial lender to loan the money to build the farm. To the court, this was enough to show traceability of FSA’s actions to the injuries FWW claimed.
FSA next argued that the remedy sought by FWW will not redress FWW’s injuries. The court again disagreed with FSA on this issue. To the court, FSA will be continually overseeing the loan guarantee and maintains some control over the poultry farm. For example, a court could order FSA to withdraw the loan guarantee pending further environmental assessments, and then FWW’s injury would be redressed. The court ruled that FWW has standing.
What Does This Mean?
This recent ruling was procedural and told us nothing of the merits of the FWW claim that FSA failed to complete an adequate NEPA environmental assessment required before granting the federal loan guarantee. The ruling focused on whether can FWW brings this challenge, and the court agrees that FWW can. We still have to wait and see how the court will rule in this case and potential appeals of that decision before the case is final.
Buffalo River Watershed Alliance v. Dep’t of Agric., No. 13-cv-450, 2014 WL 6837005 (E.D. Ark. Dec. 2, 2014).
Food & Water Watch v. Dep’t of Agric., No. 17-1714, 2018 WL 4283568 (D. D.C. Sept. 9, 2018).