Louisiana Must Pay Part of Post-Katrina Canal Project: Court

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By Alan Kovski

Aug. 24 — Louisiana must share some of the costs for closing a navigation channel in the aftermath of Hurricane Katrina, despite the state’s claim that the U.S. Army Corps of Engineers was obligated to pay the full amount, an appeals court ruled Aug. 23 ( Louisiana v. U.S. Army Corps of Eng’rs , 5th Cir., No. 15-30962, 8/23/16 ).

The U.S. Court of Appeals for the Fifth Circuit deferred to the corps’ interpretation of language in the Water Resources Development Act of 2007 (Pub. L. No. 110-114) in overturning a district court decision in favor of Louisiana.

The WRDA bill directed the corps to do a cost-effective job of closing the Mississippi River-Gulf Outlet canal and restoring the ecosystem around the canal. The canal has been closed but the restoration work has not yet begun.

The appeals court said the corps was entitled to interpret the mandate for cost effectiveness as authorization to insist on cost sharing with Louisiana.

The 76-mile Mississippi River-Gulf Outlet navigation channel was completed by the corps in 1968 as a shorter deep-draft route between New Orleans and the Gulf of Mexico. It has deteriorated over the years, widening from erosion. According to some critics, it contributed to the devastation caused by Katrina in 2005 when it was breached.

Congress in the 2007 act instructed the Corps of Engineers to close the canal and restore the ecosystem along it “if the Secretary determines that the project is cost-effective, environmentally acceptable, and technically feasible.”

Corps Divides Up Costs

The corps decided in 2008 that it would cover the cost of building a rock wall across the canal to close it off, but said a non-federal sponsor--which in practice would mean Louisiana--would have to cover the costs of the needed lands, easements, rights-of-way and disposal areas and the operations and maintenance costs for the rock wall.

Louisiana’s Coastal Protection and Restoration Authority, acting on behalf of the state, signed a memorandum of understanding with the corps that stipulated the cost sharing proposed by the corps, but the state agency insisted at the time that the cost sharing was “inconsistent with the intentions of Congress.”

Louisiana sued in 2014 charging that the Corps of Engineers insistence on cost sharing was arbitrary and capricious in violation of the Administrative Procedure Act, a law commonly used in civil suits to enforce other laws, in this case the Water Resources Development Act of 2007.

The ecosystem restoration work along the closed canal has been left in limbo because of the differing federal and state interpretations of the act. The corps estimated the restoration would cost $2.9 billion and insisted that non-federal project sponsors would have to cover 35 percent of the cost. Louisiana has refused to sign a memorandum of understanding on the ecosystem work.

To contact the reporter on this story: Alan Kovski in Washington at akovski@bna.com

To contact the editor responsible for this story: Larry Pearl at lpearl@bna.com

For More Information

The decision in Louisiana v. U.S. Army Corps of Engineers is available at http://src.bna.com/h1i.

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