IV. THE NEPA/EIS ISSUE

The National Environmental Policy Act (NEPA), 42 U.S.C. § 4321 et seq., declares a broad national commitment to protecting and promoting environmental quality. Robertson, 490 U.S. at 348; 42 U.S.C. § 4331 (1994). The primary mechanism for implementing NEPA is the Environmental Impact Statement (EIS). 42 U.S.C. § 4332 (1994). The EIS is an "action-forcing" procedure, designed "[t]o ensure that this commitment is infused into the ongoing programs and actions of the Federal Government." Robertson, 490 U.S. at 348 (quotation omitted).

NEPA requires that an agency considering any action that would have a significant impact on the environment prepare an EIS. The EIS must contain a "detailed statement" including, inter alia, the environmental impacts of the proposed project, and all reasonable alternatives to the project. 42 U.S.C. § 4332(C) (emphasis added). We previously emphasized the word "detailed" because "it connotes the careful, reasoned and fully explained analysis which we think Congress intended." Silva v. Lynn, 482 F.2d 1282, 1284 n.2 (1st Cir. 1973). Thus, the EIS helps satisfy NEPA's "twin aims": to ensure that the agency takes a "hard look" at the environmental consequences of its proposed action, and to make information on the environmental consequences available to the public, which may then offer its insight to assist the agency's decision-making through the comment process. See Robertson, 490 U.S. at 350, 356; Baltimore Gas, 462 U.S. at 97. The EIS thus "helps insure the integrity of the process of decision," providing a basis for comparing the environmental problems raised by the proposed project with the difficulties involved in the alternatives. Silva v. Lynn, 482 F.2d at 1285.

A. Consideration of Environmental Impacts

In its EIS, the agency must "consider every significant aspect of the environmental impact of a proposed action," Baltimore Gas, 462 U.S. at 97 (quoting Vermont Yankee, 435 U.S. at 553), and "evaluate different courses of action," Kleppe, 427 U.S. at 410. The EIS's discussion of environmental impacts "forms the scientific and analytic basis for the comparisons" of alternatives, 40 C.F.R. § 1502.16 (1995), which are "the heart" of the EIS, id. at § 1502.14; see Part IV(B), infra. The discussion of impacts must include both "direct and indirect effects (secondary impacts) of a proposed project." Sierra Club v. Marsh, 976 F.2d 763, 767 (1st Cir. 1992); 40 C.F.R. § 1502.16(b). The agency need not speculate about all conceivable impacts, but it must evaluate the reasonably foreseeable significant effects of the proposed action. Sierra Club v. Marsh, 976 F.2d at 767. In this context, reasonable foreseeability means that "the impact is sufficiently likely to occur that a person of ordinary prudence would take it into account in reaching a decision." Id. An environmental effect would be considered "too speculative" for inclusion in the EIS if it cannot be described at the time the EIS is drafted with sufficient specificity to make its consideration useful to a reasonable decision-maker. Id. at 768. Nevertheless, "[r]easonable forecasting . . . is . . . implicit in NEPA, and we must reject any attempt by agencies to shirk their responsibilities under NEPA by labeling any and all discussion of future environmental effects as 'crystal ball inquiry.'" Scientists' Inst. for Pub. Info. v. Atomic Energy Comm'n, 481 F.2d 1079, 1092 (D.C. Cir. 1973).

Plaintiffs contended in the district court that the Forest Service failed to adequately assess the impact of Loon Corp.'s planned expansion on Loon Pond. Plaintiffs listed a number of specific areas of concern. The district court found the Forest Service's consideration of environmental impacts to be adequate, and plaintiffs have not appealed this point. Accordingly, we need not pursue this issue here.

B. Consideration of Alternatives

"[O]ne important ingredient of an EIS is the discussion of steps that can be taken to mitigate adverse environmental consequences" of a proposed action. Robertson, 490 U.S. at 351. As one aspect of evaluating a proposed course of action under NEPA, the agency has a duty "to study all alternatives that appear reasonable and appropriate for study . . . , as well as significant alternatives suggested by other agencies or the public during the comment period." Roosevelt Campobello Int'l Park Comm'n v. United States EPA, 684 F.2d 1041, 1047 (1st Cir. 1982) (quotations omitted); Valley Citizens for a Safe Env't v. Aldridge, 886 F.2d 458, 462 (1st Cir. 1989); City of Carmel-By-The-Sea v. U.S. Dept. of Transp., 95 F.3d 892, 903 (9th Cir. 1996).

As stated in the Council on Environmental Quality ("CEQ") regulations implementing NEPA, the consideration of alternatives is "the heart of the environmental impact statement." 40 C.F.R. § 1502.14. These implementing regulations are entitled to substantial deference. Robertson, 490 U.S. at 355 (citing Andrus v. Sierra Club, 442 U.S. 347, 358 (1979)). The regulations require that the EIS "[r]igorously explore and objectively evaluate all reasonable alternatives, and for alternatives which were eliminated from detailed study, briefly discuss the reasons for their having been eliminated." 40 C.F.R. § 1502.14(a). It is "absolutely essential to the NEPA process that the decisionmaker be provided with a detailed and careful analysis of the relative environmental merits and demerits of the proposed action and possible alternatives, a requirement that we have characterized as 'the linchpin of the entire impact statement.'" NRDC v. Callaway, 524 F.2d 79, 92 (2d Cir. 1975) (citation omitted); see Silva v. Lynn, 482 F.2d at 1285; All Indian Pueblo Council v. United States, 975 F.2d 1437, 1444 (10th Cir. 1992) (holding that a thorough discussion of the alternatives is "imperative"). "The 'existence of a viable but unexamined alternative renders an environmental impact statement inadequate.'" Resources Ltd. v. Robertson, 35 F.3d 1300, 1307 (9th Cir. 1993) (quoting Idaho Conservation League v. Mumma, 956 F.2d 1508, 1519 (9th Cir. 1992)); see Grazing Fields Farm v. Goldschmidt, 626 F.2d 1068, 1072 (1st Cir. 1980) (Even the existence of supportive studies and memoranda contained in the administrative record but not incorporated in the EIS cannot "bring into compliance with NEPA an EIS that by itself is inadequate."). Because of the importance of NEPA's procedural and informational aspects, if the agency fails to properly circulate the required issues for review by interested parties, then the EIS is insufficient even if the agency's actual decision was informed and well-reasoned. Grazing Fields Farm, 626 F.2d at 1072; see Massachusetts v. Watt, 716 F.2d 946, 951 (1st Cir. 1983).

C. The Requisite Level of Detail

One purpose of the EIS requirement is to "provide decisionmakers with sufficiently detailed information to aid in determining whether to proceed with the action in light of its environmental consequences." Northwest Resource Info. Ctr., Inc. v. National Marine Fisheries Serv., 56 F.3d 1060, 1064 (9th Cir. 1995). What level of detail is sufficient depends on the nature and scope of the proposed action. Valley Citizens, 886 F.2d at 463; Mumma, 956 F.2d at 1520. The discussion of environmental effects of alternatives need not be exhaustive. "[W]hat is required is information sufficient to permit a reasoned choice of alternatives as far as environmental aspects are concerned," All Indian Pueblo Council, 975 F.2d at 1444 (quoting NRDC v. Morton, 458 F.2d 827, 836 (D.C. Cir. 1972)); see also Carmel-By-The-Sea, 95 F.3d at 903, information sufficient for the agency to "[r]igorously explore and objectively evaluate" all reasonable alternatives. 40 C.F.R. § 1502.14(a);
All Indian Pueblo Council, 975 F.2d at 1444.

The courts have applied "a rule of reason in determining whether an EIS contains a reasonably thorough discussion of the significant aspects of the probable environmental consequences." Carmel-By-The-Sea, 95 F.3d at 899 (quotation omitted); see also Grazing Fields Farm, 626 F.2d at 1074; Massachusetts v. Andrus, 594 F.2d 872, 884 (1st Cir. 1979); cf. Marsh, 490 U.S. at 373
(supplemental EIS). One aspect of this determination is whether the agency has gone "beyond mere assertions and indicate[d] its basis for them." Silva v. Lynn, 482 F.2d at 1287. The agency "must 'explicate fully its course of inquiry, its analysis and its reasoning.'" Massachusetts v. Andrus, 594 F.2d at 883 (quoting Silva v. Lynn, 482 F.2d at 1284-85). The court must determine whether, in the context of the record, the agency's decision -- and the analysis on which it is based -- is too unreasonable for the law to permit it to stand. See Sierra Club v. Marsh, 976 F.2d at 769. We apply a rule of reason because courts should not "fly speck" an EIS and hold it insufficient based on inconsequential or technical deficiencies. Swanson v. U.S. Forest Service, 87 F.3d 339, 343 (9th Cir. 1996). "The statute must be construed in the light of reason if it is not to demand what is, fairly speaking, not meaningfully possible. . . . But implicit in this rule of reason is the overriding statutory duty of compliance with impact statement procedures to the fullest extent possible." Scientists' Inst., 481 F.2d at 1092 (quotations omitted). The agency must "squarely turn[]" all "procedural corners" in its EIS. Citizens Awareness Network, 59 F.3d at 290 (quoting Adams, 38 F.3d at 49). The question whether a particular deficiency or combination is sufficient to warrant holding it legally inadequate, or constitutes merely a "fly speck," is essentially a legal question, reviewable de novo. Oregon Environmental Council v. Kunzman, 817 F.2d 484, 493 (9th Cir. 1987).

Applying these standards to the instant case, we conclude that the Forest Service has not rigorously explored all reasonable alternatives, in particular the alternative that Loon Corp. be required to build artificial water storage ponds, instead of withdrawing water for snowmaking from, and discharging water into, an "outstanding resource water" like Loon Pond. The adverse environmental impacts of
using Loon Pond were before the agency, and more than one commenter proposed building artificial water storage ponds, a proposal that would, on its face, avoid some of those adverse impacts. One such commenter, Paul Beaudin of the Lincoln Committee of Concerned Citizens (LCCC), enclosed clippings pointing up "the wisdom of [Loon Corp.'s] need to enact the LCCC's proposal for water
containment pond[s] high up on the Boyle Brook." JA, vol. II, Response to Public Comment on RDEIS at A-12. The LCCC proposal itself, made two months earlier, referred to a letter from the National Ecology Research Center recommending consideration of water storage alternatives other than Loon Pond, and enclosed a map indicating where up to three containment ponds could be installed. LCCC listed some nine advantages, including the cost-saving factor of servicing two-thirds
to three-fourths of Loon Corp.'s snowmaking system by gravity feed.[16]

Instead of "rigorously explor[ing]" the alternative of using artificial water storage units instead of Loon Pond, the Forest Service's Final EIS did not respond to these comments at all. The agency did not in any way explain its reasoning or provide a factual basis for its refusal to consider, in general, the possibility of alternatives to using Loon Pond for snowmaking, or LCCC's reasonably thoughtful proposal in particular.[17] This failure violated the Forest Service's EIS obligation under
NEPA. See 40 C.F.R. § 1502.9(b) (1995); 42 U.S.C. § 4332(C)(iii) (1994).

The use of artificial storage ponds is not so facially implausible that it can be dismissed out of hand. The Forest Service, on another occasion, required the Sugarbush Ski Area in Vermont to construct, for its snowmaking operations, three artificial water storage ponds capable of holding 123.5 million
gallons of water on 22.9 acres of private land. JA, vol. I, at 457, 465. This is 73% more than the 71 million gallons of water that the ROD estimates would be withdrawn from Loon Pond under the approved Loon Mountain expansion project. Beaudin/LCCC proposed constructing three similar ponds in the Boyle Brook area high up Loon Mountain. In addition, the record contains evidence that Loon Corp. owns 365 acres of private land at the base of the ski area, where similar storage
ponds could be constructed, and that such ponds could be filled with water from the East Branch, which is typically high enough in the spring to contribute to flooding in downstream areas.

Our conclusion is buttressed by NEPA's requirement that an agency consider and an EIS discuss "steps that can be taken to mitigate the adverse environmental consequences" of a proposed project. See Robertson, 490 U.S. at 351. Even though there is no requirement that the agency reach a particular substantive result, such as actually formulating and adopting a complete mitigation plan, the agency must discuss "the extent to which adverse effects can be avoided," i.e., by mitigation measures, "in sufficient detail to ensure that environmental consequences have been fairly evaluated." Id. at 352. This duty -- coupled with the comments alerting the agency to the environmental consequences of using Loon Pond for snowmaking and suggesting the containment pond solution -- required the Forest Service to seriously consider this alternative and to explain its reasoning if it rejected the proposal.

Nor can the Forest Service claim that its failure to consider an alternative to using Loon Pond for snowmaking was a de minimis or "fly speck" issue. The record indicates serious adverse consequences to Loon Pond if it is used "as a cistern," to use EPA's words, and at least a reasonable probability that the use of artificial storage ponds could avoid those consequences. The existence of this non-de minimis "viable but unexamined alternative renders [the Loon EIS] inadequate." See Resources, Inc., 35 F.3d at 1307.

After the matter had proceeded to court, counsel for the Forest Service argued that constructing artificial storage ponds large enough to serve as an alternative to using Loon Pond would not be a viable alternative for reasons that were conclusorily stated. The district court accepted this argument. But this "post hoc rationalization of counsel" cannot overcome the agency's failure to consider and address in its FEIS the alternative proposed by commenters. State Farm, 463 U.S. at 50; see Burlington Truck Lines, Inc. v. United States, 371 U.S. 156, 168 (1962); NRDC v. U.S. EPA, 824 F.2d 1258, 1286 n.19 (1st Cir. 1987). Such post hoc rationalizations are inherently suspect, and in any event are no substitute for the agency's following statutorily mandated procedures. As noted supra, even if the agency's actual decision was a reasoned one, the EIS is insufficient if it does not properly discuss the required issues. Grazing Fields Farm, 626 F.2d at 1072.

In sum, how "probing" an investigation NEPA requires of alternatives depends on the circumstances, including the nature of the action at issue. Valley Citizens, 886 F.2d at 463. Thus, the reviewing court must be flexible in evaluating the depth of analysis to require in an EIS, because, while NEPA "does not mandate particular results," it does require that the agency have adequately identified and evaluated a project's environmental consequences. Robertson, 490 U.S. at 350. "NEPA's success in large part arises from the use of legal concepts [that are flexible] such as 'reasonableness' and 'adequacy' that permit courts to adapt it successfully to so many different kinds of circumstances surrounding so many different kinds of governmental decisions." Valley Citizens, 886 F.2d at 463.

Although in Valley Citizens we found the agency's analysis of alternatives "brief but adequate," 886 F.2d at 462, the contrast with the instant case is instructive. In Valley Citizens, we found that nothing in the record or in comments on the draft "point[ed] out any inaccuracy" in the agency's cost "descriptions" or in its "discussions" of other non-environmental considerations. Id. In contrast, in the instant case, the final EIS contains no "description" or "discussion" whatsoever as to why an alternative source of water such as an artificially created storage pond would be impractical. The
agency has discretion to balance competing concerns and to choose among alternatives, but it must legitimately assess the relative merits of reasonable alternatives before making its decision.

After a searching and careful review of the record in the instant case, we are not convinced that the Forest Service's decision was founded on a reasoned evaluation of the relevant factors, Marsh, 490 U.S. at 378, or that it articulated a rational connection between the facts found and the choice made, Baltimore Gas, 462 U.S. at 105. Hence, it acted arbitrarily and capriciously in granting Loon Corp.'s special use permit for the expanded ski resort. Moreover, because the Forest Service did
not satisfy the requirement that it "rigorously explore and objectively evaluate" all reasonable alternatives,[18] 40 C.F.R. § 1502.14(a), its decision was not in accordance with law.[19] See 5 U.S.C. § 706(2)(A).