Forsyth County v. United States Army Corps of Engineers

[PUBLISH]
IN THE UNITED STATES COURT OF APPEALS
FOR THE ELEVENTH CIRCUIT FILED
________________________ U.S. COURT OF APPEALS
ELEVENTH CIRCUIT
No. 10-10279 FEB 14, 2011
JOHN LEY
________________________ CLERK
D.C. Docket No. 2:08-cv-00126-RWS
FORSYTH COUNTY,
a political subdivision of the State of Georgia,
lllllllllllllllllllll Plaintiff - Appellant,
versus
UNITED STATES ARMY CORPS OF ENGINEERS,
COLONEL BYRON G. JORNS,
Mobile District Engineer, in his official capacity,
BRIGADIER GENERAL JOSEPH SCHROEDEL,
South Atlantic Division Commander, in his official capacity,
MAJOR GENERAL DON T. RILEY,
Director of Civil Works, in his official capacity,
LIEUTENANT GENERAL ROBERT L. VAN ANTWERP,
Commander and Chief of Engineers, in his official capacity, et al.,
lllllllllllllllllllll Defendants - Appellees.
________________________
Appeal from the United States District Court
for the Northern District of Georgia
________________________
(February 14, 2011)
Before WILSON and PRYOR, Circuit Judges, and BUCKLEW,* District Judge.
PRYOR, Circuit Judge:
This appeal from the denial of a preliminary injunction requires us to
determine whether an evaluation of competing proposals for the lease of Bethel
Park on Lake Sydney Lanier in Forsyth County, Georgia, by the United States
Army Corps of Engineers is subject to a right of first refusal for a local
government and, if not, whether the weight accorded to a preference for the lease
is otherwise subject to judicial review under the Administrative Procedure Act, 5
U.S.C. § 551 et seq. The Flood Control Act of 1944 permits the Corps to grant
leases of public parks and recreational facilities at water resource development
projects on terms and for purposes that it determines are “reasonable in the public
interest” and requires the Corps to give a preference to “local governmental
agencies,” among others. 16 U.S.C. § 460d. Forsyth County, Georgia, and the
Young Men’s Christian Association of Greater Atlanta submitted competing
proposals to lease Bethel Park. After the Corps evaluated each proposal, it
awarded the lease to the Association because the Corps determined that the award
would better serve the public interest to a degree sufficient to overcome the
*
Honorable Susan C. Bucklew, United States District Judge for the Middle District of
Florida, sitting by designation.
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preference owed to the County under section 460d. The County filed a complaint
that the Corps had violated the preference clause in section 460d and moved for a
preliminary injunction to prevent the Corps from leasing the park to the
Association. The district court denied the motion on the ground that the County
was unlikely to succeed on the merits of its complaint. Because section 460d does
not create a right of first refusal for preference entities and the weight accorded to
the preference for a lease is “committed to agency discretion by law,” 5 U.S.C. §
701(a)(2), and is not subject to judicial review, we affirm.
I. BACKGROUND
The Flood Control Act of 1944 empowers “[t]he Chief of Engineers, under
the supervision of the Secretary of the Army, . . . to construct, maintain, and
operate public park and recreational facilities at water resource development
projects under the control of the Department of the Army.” 16 U.S.C. § 460d.
The Act also empowers the Secretary of the Army “to grant leases of lands,
including structures or facilities thereon, at water resource development projects
for such periods, and upon such terms and for such purposes as he may deem
reasonable in the public interest.” Id. The Act conditions the grant of a lease on
several additional considerations, one of which is a preference for certain entities:
[P]reference shall be given to federally recognized Indian tribes and
Federal, State, or local governmental agencies, and licenses or leases
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where appropriate, may be granted without monetary considerations, to
such Indian tribes or agencies for the use of all or any portion of a
project area for any public purpose, when the Secretary of the Army
determines such action to be in the public interest, and for such periods
of time and upon such conditions as he may find advisable[.]
Id. The Secretary of the Army has also promulgated a regulation that mirrors the
language of section 460d:
The Secretary of the Army is authorized to grant leases of lands,
including structures or facilities thereon, in reservoir areas for such
periods and upon such terms as he may deem reasonable[.] . . .
[P]reference shall be given to Federal, State, or local governmental
agencies, and licenses may be granted without monetary considerations
to such agencies for the use of all or any portion of a reservoir area,
when the Secretary of the Army determines such actions to be in the
public interest, and for such periods of time and upon such conditions
as he may find advisable.
33 C.F.R. § 211.6(a)(2).
Under these grants of authority, the United States Army Corps of Engineers
administers 38 parks and recreational facilities on Lake Sidney Lanier in northern
Georgia. Over time, the Corps has also granted 44 leases for parks and
recreational facilities around the lake to various entities, public and private. These
grants consist of fourteen leases to local governmental entities, including three to
Forsyth County, Georgia; ten leases to the State of Georgia; eight leases to private
concessionaires; and twelve leases to private organizations, including the Boys
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Club, the Girl Scouts, the Methodist Church, the American Legion, and the Young
Men’s Christian Association.
One of the parks administered by the Corps is Bethel Park, a day-use park
that sits by Lake Lanier on about 62 acres. Of the 38 parks that the Corps operated
in 2008, Bethel Park ranked 37th in terms of public usage. In March 2003, the
Young Men’s Christian Association of Greater Atlanta approached the Corps to
discuss the possibility of leasing more property on Lake Lanier for a summer
camp. The Association submitted a formal proposal to the Corps to lease Bethel
Park in 2004, and supplemented that proposal in 2005 with a proposed master plan
that detailed its development plans. The Association proposed to develop Bethel
Park to provide overnight and day-use facilities for campers, including cabins, a
dining hall, active recreation areas, a multi-purpose court, outdoor amphitheaters
and classrooms, hiking trails, a marina, a fishing pier, and a beach area.
Forsyth County also sought leases from the Corps. In 2004, for example,
the County emailed the Corps to inquire about the possibility of leasing property
around Lake Lanier. As a result of this inquiry and further discussions, the Corps
leased Young Deer and Charleston Parks to the County in March 2005.
In December 2005, the Corps issued a “Recreation Development Policy for
Outgranted Corps Land,” a new policy governing the evaluation of proposals for
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recreational development of lands and waters at water resource development
projects. The new policy established the following several criteria that a district
team of Corps employees must follow when it “evaluate[s] requests for recreation
development”:
Consistent with project purposes; Reasonable connection to the project’s
natural and other resources; Consistent with land use classifications and
resource management objectives in the Project Master Plan (or
supplement thereto); In the public interest; Justified by public demand
. . . ; Economically viable . . . ; Meets the recreation demands created by
the project itself while balancing natural resources requirements.
In April 2006, in a letter to the Corps, the County sought to lease 15 parks
administered by the Corps, including Bethel Park. The County acknowledged that
it was aware that the Corps was negotiating a lease of Bethel Park with “other
entities,” but the County stated that a “local government would have ‘first option’
should the Corps ever decide to lease these parks out.” The Corps agreed to
discuss leasing several of the 15 parks to the County, but informed the County that
it “remain[ed] committed to . . . the [Association] . . . for the operation and
maintenance of [Bethel Park]. . . . [D]iscussions with the [Association] have been
ongoing since early 2003.” Later that month, the Corps made available to the
public and requested comments on a draft Environmental Assessment and Master
Development Plan for Bethel Park prepared by the Association. The County
submitted a comment in which it argued that it “was not given a right of first
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refusal or ‘preference’ with respect to acquiring Bethel Park as required by federal
law.”
In September 2006, the County renewed its request to lease Bethel Park
from the Corps. The Corps invited the County to submit a written proposal with
supporting documentation, including a development plan and a market feasibility
study. The Corps also invited the Association to submit a renewed proposal with
supporting documentation. In February 2007, the County and the Association
submitted their proposals to the Corps. The proposal of the Association
essentially mirrored its previous proposal. The County proposed an overnight and
day-use facility, with camping sites for recreational vehicles and tent campers, a
day-use area, a boat ramp and trailer parking area, a 90-space parking area,
comfort facilities, an environmental education area, a beach area, and walking
trails. The Corps evaluated both proposals and released a new Environmental
Assessment for public comment in January 2008 that discussed the environmental
impacts of leasing Bethel Park “to a yet undetermined non-Federal entity.” The
Corps received over 4,900 comments on the Assessment, most of which were
letters of support for either the Association or the County.
On June 5, 2008, the Corps announced in a news release that it planned to
lease Bethel Park to the Association. The Corps explained that it had “conducted
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an objective and very detailed evaluation of the two proposals to determine which
one was in the best interest of the public.” The Corps assigned each of the
proposals a scaled score for specific categories to ensure that it “carefully followed
[its] mandated seven evaluation criteria” and determined that the proposal of the
Association “ranked significantly higher in three of the evaluated areas[:] . . .
public interest, market study, and feasibility.” Overall, the Corps awarded 45
points to the Association and 32 points to the County; these totals included an
award of 37 points to the Association and an award of 30 points to the County on
the basis of whether “the proposal [was] in the public interest.” The Corps
concluded that the proposal of the County “only replicate[d] and add[ed] to similar
facilities already located within a 25-mile radius of the site location,” but the
proposal of the Association “offer[ed] relatively unique facilities and programs for
Lake Lanier, with a broad array of activities.” The Corps also stated that the
County had not explained how it intended to fund its proposal at a cost of $4.4
million. The Association, on the other hand, provided “a detailed plan on [$20
million of] capital funding for the facilities” and “substantiate[d] [its] figures and
projections based on data from ongoing operations at similar [Association]
facilities.” The Corps was confident that the proposal of the Association would
provide “a long term benefit to the public in the region.” The Corps provided the
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text of section 460d in its entirety in the evaluation and concluded that “due to the
factors set out above, the proposal by the [Association] should be considered in
the best interest of the public to a degree sufficient to overcome the preference set
out in the statute.”
The County filed a complaint and a motion for a preliminary injunction in
the district court to prevent the Corps from leasing Bethel Park to the Association.
The County alleged, in part, that the Corps had violated the preference
requirement for local governmental agencies in section 460d. Although the
Association executed a lease and forwarded it to the Corps, the Corps refused to
sign the lease while it negotiated with the County. In the light of the settlement
negotiations between the Corps and the County, the district court denied the
motion of the County for a preliminary injunction with a right to refile. The
district court also denied the motion of the Association to intervene, in part
because the Association had failed to provide “any evidence of a written
agreement or other contractual privity in existence between [the Association] and
the Corps regarding . . . Bethel Park.” After its negotiations with the County were
unsuccessful, the Corps executed a lease for Bethel Park with the Association on
September 22, 2009, and the district court permitted the Association to intervene.
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The County renewed its motion for a preliminary injunction. At a hearing
on the motion, the County acknowledged that the Corps purportedly had granted
the preference, but the County disputed the result of that application:
The Corps, by its own actions, has . . . tried to embrace the preference.
. . . The position of the Corps has been, we’re going to try and comply
with the Flood Control Act in this manner, we’re going to try to apply
the preference. It is simply the County’s position . . . that it was done
absolutely incorrectly.
On December 23, 2009, the district court denied the motion of the County
for a preliminary injunction. The district court applied deference to the decision of
the Corps under Chevron U.S.A., Inc. v. Natural Resources Defense Council, 467
U.S. 837, 104 S. Ct. 2778 (1984), and concluded that the County had failed to
establish a likelihood of success on the merits. The district court reasoned that
“the clear objective [of section 460d] is to entrust the [Corps] to grant leases of
land in the public interest” and that a “preferred organization must also meet the
primary and founding goal of the statute by serving the public interest.” The
district court concluded that the Corps had granted the preferential treatment owed
to the County under section 460d, but had reasonably determined within its
discretion that, despite the preference, the proposal of the Association “better
served the public interest.”
II. STANDARD OF REVIEW
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“We review the decision to deny a preliminary injunction for abuse of
discretion.” Scott v. Roberts, 612 F.3d 1279, 1289 (11th Cir. 2010). “In so doing,
we review the findings of fact of the district court for clear error and legal
conclusions de novo.” Id. “This scope of review will lead to reversal only if the
district court applies an incorrect legal standard, or applies improper procedures,
or relies on clearly erroneous factfinding, or if it reaches a conclusion that is
clearly unreasonable or incorrect.” Schiavo ex rel. Schindler v. Schiavo, 403 F.3d
1223, 1226 (11th Cir. 2005). Otherwise, “an abuse of discretion standard
recognizes there is a range of choice within which we will not reverse the district
court even if we might have reached a different decision.” Id. A party that seeks a
preliminary injunction must establish that “(1) it has a substantial likelihood of
success on the merits; (2) irreparable injury will be suffered unless the injunction
issues; (3) the threatened injury to the movant outweighs whatever damage the
proposed injunction may cause the opposing party; and (4) if issued, the injunction
would not be adverse to the public interest.” Siegel v. LePore, 234 F.3d 1163,
1176 (11th Cir. 2000) (en banc). “‘A preliminary injunction is an extraordinary
and drastic remedy not to be granted unless the movant clearly establishes the
burden of persuasion as to the four requisites.’” Am. Civil Liberties Union of Fla.,
Inc. v. Miami-Dade Cnty. Sch. Bd., 557 F.3d 1177, 1198 (11th Cir. 2009) (quoting
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All Care Nursing Serv., Inc. v. Bethesda Mem’l Hosp., Inc., 887 F.2d 1535, 1537
(11th Cir. 1989)).
III. DISCUSSION
We divide our discussion in two parts. First, we explain that section 460d
does not create a right of first refusal for preference entities. Second, we explain
that the weight accorded to a preference for a lease under section 460d is
“committed to agency discretion by law” and is not subject to judicial review
under the Administrative Procedure Act, 5 U.S.C. § 701(a)(2).
A. Section 460d Does Not Create a Right of First Refusal for Preference Entities.
The County argues that section 460d unambiguously creates a right of first
refusal for preference entities for leases of lands at water resource development
projects as long as those entities are “ready and willing” to “implement a bona-fide
recreational plan,” but we disagree. Although section 460d requires that
“preference shall be given to . . . local governmental agencies,” it also empowers
the Secretary of the Army to grant leases “upon such terms and for such purposes
as he may deem reasonable in the public interest.” 16 U.S.C. § 460d. The Corps
must give a local government a preference, but the Corps must also consider the
public interest. The 2005 Recreation Development Policy followed by the Corps,
which became Chapter 16 of Engineer Regulation 1130-2-550 in 2009, provides
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several factors the Corps must consider when it evaluates competing proposals for
a lease under section 460d, including the purposes of the project, natural and other
resources, land use classifications, public demand, economic viability, and
recreational demands.
In this kind of competitive or commercial process, a preference gives a
competitor an advantage, but not an entitlement to win. We have held that another
provision of the Flood Control Act of 1944 that directed the Secretary of Energy to
transmit and dispose of power under his control “in such manner as to encourage
the most widespread use thereof” and provided that “[p]reference in the sale of
such power and energy shall be given to public bodies and corporations,” 16
U.S.C. § 825s, “merely establishe[d] a series of general directives to control the
distribution of excess electricity” and did “not establish an entitlement to power,”
Greenwood Utils. Comm’n v. Hodel, 764 F.2d 1459, 1464 (11th Cir. 1985). The
same is true here. The preference clause in section 460d does not create an
entitlement to the lease of Bethel Park for the County; section 460d establishes
general factors that the Corps must consider when it evaluates proposals for leases.
The County contends that the Corps violated its own regulations when it
awarded the lease of Bethel Park to the Association, but we again disagree. The
regulation that governs leases under section 460d permits the Secretary of the
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Army to lease lands “in reservoir areas for such periods and upon such terms as he
may deem reasonable” and requires that “preference shall be given to Federal,
State, or local governmental agencies.” 33 C.F.R. § 211.6(a)(2). This regulation
repeats the substantive requirements of section 460d and fails to support the
argument of the County for a right of first refusal. Although the County cites
another regulation, 32 C.F.R. § 643.23, that provides the order of “preference” for
some leases by the Army, 10 U.S.C. § 2667, that regulation does not govern the
lease for the water development project at Bethel Park, which the Corps and the
Association executed under section 460d. Section 2667, in contrast with section
460d, provides “[o]ne of the principal authorities for the use of military real estate
for commercial purposes.” 32 C.F.R. § 643.3; see also Eng’r Reg. 405-1-12
(explaining the difference between leases under section 460d and section 2667).
B. The Weighing of the Preference by the Corps is Not Subject to Judicial Review
under the Administrative Procedure Act.
The County argues alternatively that the Corps gave no discernible weight
or value to the preference in the evaluation of the competing proposals, but we
must decide first whether that decision is even subject to judicial review. Before
we can review the evaluation by the Corps under the Administrative Procedure
Act, the County “must first clear the hurdle of § 701(a),” Heckler v. Chaney, 470
U.S. 821, 828, 105 S. Ct. 1649, 1654 (1985), which provides that final agency
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action is subject to judicial review unless “agency action is committed to agency
discretion by law,” 5 U.S.C. § 701(a)(2). The County cannot clear that hurdle.
The Supreme Court has explained that the primary focus of section
701(a)(2) is whether the governing statute provides the courts with “law to apply”:
[W]e therefore turn to the [applicable federal statute] to determine
whether in this case Congress has provided us with “law to apply.” If
it has indicated an intent to circumscribe agency enforcement discretion,
and has provided meaningful standards for defining the limits of that
discretion, there is “law to apply” under § 701(a)(2), and courts may
require that the agency follow that law; if it has not, then an agency . .
. decision [is] “committed to agency discretion by law” within the
meaning of that section.
Heckler, 470 U.S. at 834–35, 105 S. Ct. at 1657. Although section 701(a)(2) “is a
very narrow exception” and only “applicable in those rare instances where statutes
are drawn in such broad terms that in a given case there is no law to apply,”
Citizens to Preserve Overton Park, Inc. v. Volpe, 401 U.S. 402, 410, 91 S. Ct. 814,
820–21 (1971) (footnote and internal quotation marks omitted), overruled on other
grounds by Califano v. Sanders, 430 U.S. 99, 97 S. Ct. 980 (1977), “review is not
to be had if the statute is drawn so that a court would have no meaningful standard
against which to judge the agency’s exercise of discretion,” Heckler, 470 U.S. at
830, 105 S. Ct. at 1655.
We have held that the Secretary of the Interior’s statutory authority to
acquire land in trust for Indians was “committed to agency discretion by law”
15
under section 701(a)(2) when the Secretary’s decision “involve[d] a myriad of
factors” and the governing statute provided the Secretary “broad discretion” and
failed to “delineate the circumstances under which exercise of [that] discretion
[was] appropriate.” Fla. Dep’t of Bus. Regulation v. U.S. Dep’t of Interior, 768
F.2d 1248, 1256 (11th Cir. 1985). The statute empowered the Secretary, “in his
discretion, to acquire . . . any interest in lands . . . for the purpose of providing land
for Indians.” 25 U.S.C. § 465. We explained that “[i]f there are no judicially
manageable standards available for judging how and when an agency should
exercise its discretion, then it is impossible to determine even whether the agency
abused its discretion.” Fla. Dep’t of Bus. Regulation, 768 F.2d at 1255. We also
held that an accompanying regulation did not provide “law to apply” even though
it provided factors the Secretary had to consider under the federal statute:
[T]he factors, although they are guides for the exercise of the Secretary’s
discretion, are not “law” that a reviewing court can apply. The
regulation does not purport to state how the agency should balance these
factors in a particular case, or what weight to assign to each factor. . . .
The factors listed in the regulation are not the kind of legal principles
courts are familiar with applying to a particular case.
Id. at 1256–57. See also Lenis v. U.S. Att’y Gen., 525 F.3d 1291, 1294 (11th Cir.
2008); Haitian Refugee Ctr., Inc. v. Baker, 953 F.2d 1498, 1507–08 (11th Cir.
1992); S. Research Inst. v. Griffin Corp., 938 F.2d 1249, 1254–55 (11th Cir.
16
1991); Am. Fed’n of Gov’t Emps., Local 2017 v. Brown, 680 F.2d 722, 725–27
(11th Cir. 1982); Bullard v. Webster, 623 F.2d 1042, 1046 (5th Cir. 1980).
We are without “law to apply” to govern the review of the weight accorded
the preference for the lease of Bethel Park. Although the statutory and regulatory
framework grants a preference for the County, that framework also requires the
Secretary of the Army to consider the public interest. The 2005 Recreation
Development Policy provides several additional factors that the Corps must
consider when it evaluates proposals for leases. No law provides “how the agency
should balance these factors in a particular case, or what weight to assign to each
factor.” Fla. Dep’t of Bus. Regulation, 768 F.2d at 1256. Section 460d instead
grants the Secretary broad discretion to award leases “for such periods, and upon
such terms and for such purposes as he may deem reasonable in the public
interest.” 16 U.S.C. § 460d. We have recognized that “‘[t]he court is not
empowered to substitute its judgment for that of the agency,’” Envtl. Def. Fund,
Inc. v. Corps of Eng’rs of U.S. Army, 492 F.2d 1123, 1139 n.33 (5th Cir. 1974)
(quoting Overton Park, 401 U.S. at 416, 91 S. Ct. at 824), when the relevant
statute “‘leaves room for a responsible exercise of discretion and may not require
particular substantive results in particular problematic instances,’” id. at 1139–40
n.33 (quoting Calvert Cliffs’ Coordinating Comm., Inc. v. U.S. Atomic Energy
17
Comm’n, 449 F.2d 1109, 1112 (D.C. Cir. 1971)). A challenge to the procedural
compliance of agency action may warrant “full court consideration,” but a
“determination of the point where the final balance to act or withhold action is so
broadly committed to quasi-legislative agency action that court review is
exceedingly narrow.” Id. at 1139 n.33.
The district court did not abuse its discretion when it denied the motion of
the County for a preliminary injunction. The County failed to establish a
substantial likelihood of success on the merits of its complaint. The County
offered no proof that the Corps had wholly ignored the preference clause of
section 460d. The Corps instead presented evidence that it had granted the County
a preference, but the County asked the district court to second guess the weight
accorded that preference amidst a host of other factors considered by the Corps in
its evaluation of the competing proposals. Because there is no “law to apply” and
no “meaningful standard against which to judge” the weight accorded the
preference for the lease of Bethel Park, that decision by the Corps is not subject to
judicial review under the Administrative Procedure Act. The weighing of the
preference for the lease is “committed to agency discretion by law.” 5 U.S.C. §
701(a)(2).
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IV. CONCLUSION
We AFFIRM the denial of the motion for a preliminary injunction.
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