Louisiana State v. United States Army Corps of Engineers, 834 F.3d 574

Background

MR-GO is a 76-mile federal navigation channel; after Hurricane Katrina Congress directed the Corps to deauthorize (close) it and restore the ecosystem via the 2007 WRDA.
2007 WRDA required closure/restoration “in a manner consistent with” cost-sharing requirements in the 2006 Fourth Supplemental appropriations bill; that Supplemental funded planning and some restoration but did not unambiguously allocate full federal funding for implementation.
The Corps issued a 2008 Deauthorization Report (closure) recommending a federally funded rock closure but assigning LEERDs and OMRR&R costs to a non‑federal sponsor; Louisiana (CPRA) signed an MOA agreeing to that allocation but disputed that Congress intended non‑federal cost sharing.
A 2012 Supplemental Report addressed ecosystem restoration and proposed a 65% federal / 35% non‑federal split; CPRA refused to sponsor the non‑federal share and the Corps deferred final decisions on portions of the plan.
Louisiana sued under the APA challenging the Corps’ cost‑sharing as contrary to the statutes; district court held the statutes unambiguous for full federal expense and granted summary judgment for Louisiana.
Fifth Circuit: held (1) the MOA (Oct. 31, 2008) was the final agency action for closure (so the suit was timely), (2) the 2012 Supplemental Report was not final (so that challenge was dismissed for lack of jurisdiction), and (3) the Corps’ cost‑sharing interpretation for the closure was a permissible Chevron construction — reversed in part, dismissed in part.

Issues

Issue	Plaintiff's Argument	Defendant's Argument	Held
Timeliness / final agency action for closure	Louisiana: agency action became final with June 5, 2008 Deauthorization Report; suit within 6 years only if later event	Corps: 2008 transmission to Congress was final (agency decision consummated then)	Held: 2008 transmission was interlocutory; the Oct. 31, 2008 MOA constituted final agency action for closure, so suit timely
Finality re: ecosystem restoration (2012 Supplemental)	Louisiana: transmission was final; challenge timely	Corps: transmission was not final; further action needed	Held: 2012 Supplemental transmission was not final; court lacks jurisdiction to review that cost‑share allocation now
Statutory interpretation (Chevron Step 1): do 2007 WRDA & 4th Supplemental unambiguously require full federal funding?	Louisiana: Fourth Supplemental (and headings like "Construction") show Congress required full federal expense for MR‑GO closure and restoration	Corps: statutes are ambiguous as to implementation funding; appropriations earmarks do not mandate full federal expense	Held: Statutes ambiguous on who bears implementation costs; no unambiguous congressional command for full federal expense
Chevron Step 2: Was Corps’ cost‑sharing allocation reasonable?	Louisiana: Corps used wrong 1986 WRDA provision and should have applied inland waterway rule that makes federal gov’t bear OMRR&R	Corps: its reliance on catch‑all and other 1986 WRDA provisions (and the Fourth Supplemental funding structure) was reasonable	Held: Corps’ interpretation and use of 1986 WRDA cost‑sharing approach was a permissible, reasonable construction; Chevron deference owed, so cost‑sharing for closure upheld

Key Cases Cited

Bennett v. Spear, 520 U.S. 154 (1997) (two‑part finality test for APA review: consummation of decisionmaking and determination of rights/obligations)
Chevron U.S.A., Inc. v. Natural Res. Def. Council, 467 U.S. 837 (1984) (framework for reviewing agency statutory interpretations)
Massachusetts v. EPA, 549 U.S. 497 (2007) (agencies may proceed in phases and need not resolve massive problems in one step)
Hawkes Co. v. U.S. Army Corps of Engineers, 578 U.S. 590 (2016) (administrative determinations can create legal consequences sufficient for APA review)
Buffalo Marine Servs. Inc. v. United States, 663 F.3d 750 (5th Cir. 2011) (standards for reviewing agency action under the APA)