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31 2' y' Fsd'eral. ke ster / Vol: 69;1'N6_ 168 / Tuesday, August 31, 2004 / Rules and Regulations a DEPARTMENT OF THE IN, ntation of laws and regulations o via the need for critical habitat. Fish and Wildlife Service The Service's present system for designating critical habitat has evolved 50 CFR Part 17 since its original statutory prescription RIN 1018 -AG29 into a process that provides little real conservation benefit, is driven by Endangered and Threatened Wildlife litigation and the courts rather than and Plants; Final Designation of biology, limits our ability to fully Critical Habitat for the Mexican Spotted evaluate the science involved, consumes owl enormous agency resources, and imposes huge social and economic AGENCY: Fish and Wildlife Service, costs. The Service believes that Interior. additional agency discretion would ACTION: Final rule. allow our focus to return to those actions that provide the greatest benefit SUMMARY: We, the U.S. Fish and Wildlife Service (Service), designate critical habitat under the Endangered Species Act of 1973, as amended (Act), for the Mexican spotted owl (Strix occidentalis lucida) (owl). The owl inhabits canyon and forest habitats across a range that extends from southern Utah and Colorado, through Arizona, New Mexico, and west Texas, to the mountains of central Mexico. We designate approximately 3.5 million hectares (ha) (8.6 million acres (ac)) of critical habitat in Arizona, Colorado, New Mexico, and Utah, on Federal lands. Section 7 of the Act requires Federal agencies to ensure that actions they authorize, fund, or carry out are not likely to destroy or adversely modify designated critical habitat. As required by section 4 of the Act, we considered economic and other relevant impacts prior to making a final decision on what areas to designate as critical habitat. DATES: This final rule is effective September 30, 2004. ADDRESSES: The complete supporting record for this rule is on file at the New Mexico Ecological Services Field Office, 2105 Osuna Road NE, Albuquerque, New Mexico 87113. You may view the complete file for this rule, by appointment, during normal business hours at the above address. FOR FURTHER INFORMATION CONTACT: Susan MacMullin, New Mexico Ecological Services Field Office, at the above address; telephone 505/346 -2525, facsimile 505/346 -2542. SUPPLEMENTARY INFORMATION: Designation of Critical Habitat Provides Little Additional Protection to Species In 30 years of implementing the Act, the Service has found that the designation of statutory critical habitat provides little additional protection to most listed species, while consuming significant amounts of available conservation resources. Additionally, we have also found that comparable conservation can be achieved by to the species most in need of protection. Role of Critical Habitat in Actual Practice of Administering and Implementing the Act While attention to and protection of habitat is paramount to successful conservation actions, we have consistently found that, in most circumstances, the designation of critical habitat is of little additional value for most listed species, yet it consumes large amounts of conservation resources. Sidle (1987) stated, "Because the Act can protect species with and without critical habitat designation, critical habitat designation may be redundant to the other consultation requirements of section 7." Currently, only 36 percent (445 species) of the 1,244 listed species in the U.S. under the jurisdiction of the Service have designated critical habitat. We address the habitat needs of all 1,244 listed species through conservation mechanisms such as listing, section 7 consultations, the section 4 recovery planning process, the section 9 protective prohibitions of unauthorized take, section 6 funding to the States, and the section 10 incidental take permit process. The Service believes it is these measures that may make the difference between extinction and survival for many species. We note, however, that a recent 9th Circuit judicial opinion, Gifford Pinchot Task Force v. United States Fish and Wildlife Service, has invalidated the Service's regulation defining destruction or adverse modification of critical habitat. We are currently reviewing the decision to determine what effect it may have on the outcome of consultations pursuant to Section 7 of the Act. Procedural and Resource Difficulties in Designating Critical Habitat We have been overwhelmed with lawsuits regarding designation of critical habitat, and we face a growing number of lawsuits challenging critical habitat determinations once they are made. These lawsuits have subjected the Service to an ever - increasing series of court orders and court- approved settlement agreements, compliance with which now consumes nearly the entire listing program budget. This leaves the Service with little ability to prioritize its activities to direct scarce listing resources to the listing program actions with the most biologically urgent species conservation needs. The consequence of the critical habitat litigation activity is that limited listing funds are used to defend active lawsuits, to respond to Notices of Intent (NOIs) to sue relative to critical habitat, and to comply with the growing number of adverse court orders. As a result, listing petition responses, the Service's own proposals to list critically imperiled species and final listing determinations on existing proposals are all significantly delayed. The accelerated schedules of court ordered designations have left the Service with almost no ability to provide for adequate public participation or to ensure a defect -free rulemaking process before making decisions on listing and critical habitat proposals due to the risks associated with noncompliance with judicially - imposed deadlines. This in turn fosters a second round of litigation in which those who fear adverse impacts from critical habitat designations challenge those designations. The cycle of litigation appears endless, is very expensive, and in the final analysis provides relatively little additional protection to listed species. The costs resulting from the designation include legal costs, the cost of preparation and publication of the designation, the analysis of the economic effects and the cost of requesting and responding to public comment, and in some cases the costs of compliance with the National Environmental Policy Act (NEPA), all are part of the cost of critical habitat designation. None of these costs result in any benefit to the species that is not already afforded by the protections of the Act enumerated earlier, and they directly reduce the funds available for direct and tangible conservation actions. Background It is our intent to discuss only those topics directly relevant to the designation of critical habitat in this final rule. For more information on the owl, refer to the final listing rule of March 16, 1993 (58 FR 14248), the two previous final critical habitat rules of June 6, 1995 (60 FR 29913) and February 1, 2001 (66 FR 8530), and the