Opinion
CIVIL ACTION NO. 1:21-CV-00470
2022-02-24
BG GULF COAST LNG, LLC, Phillips 66 Company, Plaintiffs, v. SABINE-NECHES NAVIGATION DISTRICT OF JEFFERSON COUNTY, TEXAS, Defendant.
Utsav Mathur, Darryl Wade Anderson, Francisco Jose Escobar-Calderon, Warren Szutse Huang, Norton Rose Fulbright US LLP, Houston, TX, for Plaintiffs. Harry M. Reasoner, Stacey Neumann Vu, Vinson & Elkins, Houston, TX, Gary Neale Reger, Gilbert Irvine Low, Orgain, Bell & Tucker LLP, L. DeWayne Layfield, Attorney at Law, Beaumont, TX, James Texas Dawson, Michael Smith McCambridge, Vinson & Elkins LLP, Washington, DC, Thomas S. Leatherbury, Vinson & Elkins LLP, Dallas, TX, for Defendant.
Utsav Mathur, Darryl Wade Anderson, Francisco Jose Escobar-Calderon, Warren Szutse Huang, Norton Rose Fulbright US LLP, Houston, TX, for Plaintiffs.
Harry M. Reasoner, Stacey Neumann Vu, Vinson & Elkins, Houston, TX, Gary Neale Reger, Gilbert Irvine Low, Orgain, Bell & Tucker LLP, L. DeWayne Layfield, Attorney at Law, Beaumont, TX, James Texas Dawson, Michael Smith McCambridge, Vinson & Elkins LLP, Washington, DC, Thomas S. Leatherbury, Vinson & Elkins LLP, Dallas, TX, for Defendant.
ORDER GRANTING DEFENDANT'S MOTION TO DISMISS AND DENYING AS MOOT PARTIES’ JOINT MOTION FOR PROTECTIVE ORDERS
Michael J. Truncale, United States District Judge
Plaintiffs BG Gulf Coast LNG ("BG") and Phillips 66 Company ("Phillips"), two major energy companies, bring suit against Defendant Sabine Neches Navigation District ("SSND"), a political subdivision of the State of Texas responsible for the construction and maintenance of ports and harbors in southeast Texas. Defendant began levying a fee against users of the Sabine-Neches Waterway ("Waterway") to fund construction improvements made to the Waterway. Plaintiffs contest this fee. Before the Court are Defendant's Motion to Dismiss, [Dkt. 5], and the Parties’ Joint Motion for Protective Orders. [Dkt. 34]. For the following reasons, Defendant's Motion to Dismiss is GRANTED . Parties’ Joint Motion for Protective Orders is DENIED AS MOOT .
I. BACKGROUND
Before the Court rests not only a matter of first impression but also a matter of utmost importance to this region, this nation, and the global economy. Defendant SSND, a political subdivision of the State of Texas responsible for southeast Texas’ ports and harbors, is spearheading a $1.2 billion infrastructure project ("Project") to modernize the Waterway. The Waterway feeds the Ports of Beaumont, Port Arthur, and Orange, Texas. It is the country's third largest waterway by total shipping tonnage and critical to national security.
Like much of the nation's water infrastructure, the Waterway has not been improved since the 1960s. Ships have become larger, and technology has advanced, but growth of the Waterway has lagged. At only forty feet in depth, it is unable to accommodate many modern, larger vessels.
To remedy this, Defendant partnered with the United States Army Corps of Engineers ("USACE") to improve the Waterway through a process proscribed by the Water Resources Development Act of 1986, 33 U.S.C. § 2201 et seq. ("WRDA-86"). Congress passed the WRDA-86 in the mid-1980s to revamp the arduous process of updating the nation's ports and harbors. Prior to the WRDA-86, "[e]very project underwent nineteen independent reviews, with an average of twenty-six years passing between the first study of a project and the project's completion." New Orleans S.S. Ass'n v. Plaquemines Port, Harbor & Terminal Dist. , 874 F.2d 1018, 1024–25 (5th Cir.), opinion amended on denial of reh'g , 891 F.2d 1153 (5th Cir. 1989). Furthermore, given the serious financial burden these projects imposed, Congress did not have enough funding for the projects that needed it most. 132 Cong. Rec. S3402 (1986). The length of time for approving and the difficulty in financing these projects hampered their implementation. In fact, "[n]o new project was authorized between 1970 until shortly before passage of the [WRDA-86]. Federal spending on harbor construction declined 78% after the 1960's [sic]; mounting pressures on the federal budget made increased appropriations for projects unlikely." Id.
Although the process is proscribed in WRDA-86, Congress approves new projects and provides cost projections for those projects in subsequent WRDA enactments. See, e.g. , Water Resources Reform and Development Act of 2014, Pub. L. No. 113-121, 128 Stat. 1193, 1364 (2014).
In response, the WRDA-86 overhauled the system for financing both new construction and improvement projects for America's ports and harbors. Instead of relying solely on federal funding, the WRDA-86 split the costs of construction with state and local entities ("non-Federal interests"). By involving non-Federal interests, Congress intended to boost local investment and hasten project completion.
The process prescribed by the WRDA-86 begins with a feasibility study performed by the USACE. 33 U.S.C. §§ 2215, 2282. This study is published in the Federal Register, then transferred to Congress by the Secretary of the Army. Id. ; see also Air Liquide Am. Corp. v. U.S. Army Corps of Eng'rs , 359 F.3d 358, 365 (5th Cir. 2004) (describing the process for harbor-restoration projects under the WRDA-86 and subsequent legislation authorizing new projects under the Water Resources Development Act of 1996, Pub. L. No. 104–303, 110 Stat. 3658 (1996) ). Upon congressional approval, which includes projected costs, Congress allocates funding ("New Start funding") to initiate the first phase of the project. See Air Liquide , 359 F.3d at 365. The USACE and the non-Federal interest then enter into a partnership agreement covering the project. 33 U.S.C. § 2211(e). This agreement must provide the federal government with the non-Federal share of costs.
The Project has complied with these requirements. The USACE produced its feasibility study in March 2011. The study recommended that Congress allocate funding for the Project because it benefits the hydrocarbon industry and the United States Military. [Dkt. 5-3 at 3, 7, 12–14]. Namely, the Project would ease congestion and allow the Waterway to accommodate larger ships. The Secretary of the Army then transferred the study to Congress, which approved the Project in 2014. Water Resources Reform and Development Act of 2014, Pub. L. No. 113-121, 128 Stat. 1193, 1364 (2014) ("WRDA-14"). The WRDA-14 listed the projected costs as $1.1 billion, with the federal government funding $748 million and Defendant footing the remaining $365 million. Id. In 2019, Congress allocated New Start funding for the Project. Energy and Water, Legislative Branch, and Military Construction and Veterans Affairs Appropriations Act, 2019, Pub. L. No. 115-244, 132 Stat. 2897, 2898–99 (2019). This New Start funding, approximately $20 million, funded the first portion of the Project, Anchorage Basin No. 1. [Dkt. 1 at ¶¶ 31, 50]. In July 2019, the USACE and Defendant entered into a Partnership Agreement ("Partnership Agreement"), which lists a projected $1.2 billion construction cost, with $732 million coming from federal coffers and the remaining $488 million coming from Defendant. Defendant's projected share of costs amounts to forty percent of the total cost of construction.
This is a projected cost. Plaintiffs have proffered evidence that the actual cost of this Project will be significantly lower.
Pursuant to the Partnership Agreement, the Project will update many features of the Waterway, including:
[D]eepening the Sabine Neches Waterway (SNWW) from 40 to 48 feet and the offshore channel from 42 to 50 feet in depth from offshore to the Port of Beaumont Turning Basin; extending the 50-foot deep offshore channel by approximately 13.2 miles to deep water in the Gulf, increasing the total length of the channel from approximately 64 to 77 miles; tapering and marking the Sabine Bank Channel from 800 feet wide to 700 feet wide; deepening and widening the Taylor Bayou channels and turning basins; easing selected bends on the Sabine-Neches Canal and Neches River Channel; constructing new and enlarging/deepening existing turning and anchorage basins on the Neches River Channel; beneficial use of dredged material features consisting of the restoration of 2,853 acres of emergent marsh, improvement of 871 acres of shallow water habitat, and nourishment of 1,234 acres of existing marsh in Texas; mitigation measures consisting of the restoration of 2,783 acres of emergent marsh, improvement of 957 acres of shallow water habitat, and stabilization and nourishment of 4,355 acres of existing marsh; and post-construction monitoring and adaptive management of the beneficial use features and mitigation areas[.]
[Dkt. 5-7 at 1–2]. Construction on the first portion of the Project, Anchorage Basin No. 1, has been completed. This portion of the Project deepened Anchorage Basin No. 1 from twenty feet to forty feet.
To fund its share of Project costs, SSND passed a User Fee Ordinance ("Ordinance") in April 2021, which charges a User Fee ("Fee") on ships with drafts in excess of twenty feet. [Dkt. 1-1]. Prior to enacting the Ordinance, SSND published it in the Federal Register in January 2021 and received public comment. SNND User Fee Notice, 86 Fed. Reg. 7369-05 (Jan. 28, 2021). The Fee collects between $0.02–$0.035 per short ton of non-hydrocarbon cargo and $0.20–$0.35 per short ton of hydrocarbon cargo. The Fee may be adjusted to as low as $0.00 for all types of cargo. [Dkt. 1 at ¶ 38(g)]. SSND will collect the Fee until either all construction costs are repaid or January 1, 2049, whichever comes first. Id. SSND began levying the Fee upon completion of Anchorage Basin No. 1 on May 1, 2021. Id. at ¶ 37.
Plaintiffs’ ships make extensive use of the Waterway. Attached to the Complaint is a list of BG ships that have been subject to the Fee, each with a fully laden forward and aft sailing draft between thirty-six and thirty-nine feet. [Dkt. 1-2]. At the time of filing, BG incurred $326,983.70 in Fees. Although Phillips has not yet paid the Fee, it has executed contracts which will subject it to the Fee in the immediate future. [Dkt. 1 at ¶ 43].
The ships themselves are not owned by Plaintiffs, rather it is their cargo that frequently traverses the Waterway.
II. LEGAL STANDARD
Federal Rule of Civil Procedure 12(b)(6) authorizes dismissal of a complaint for "failure to state a claim upon which relief can be granted." Fed. R. Civ. P. 12(b)(6). In reviewing a Rule 12(b)(6) motion, the Court "accepts all well-pleaded facts as true, viewing them in the light most favorable to the plaintiff." Sonnier v. State Farm Mut. Auto. Ins. Co. , 509 F.3d 673, 675 (5th Cir. 2007). However, "the tenet that a court must accept as true all of the allegations contained in a complaint is inapplicable to legal conclusions [and] ... Rule 8 does not unlock the doors of discovery for a plaintiff armed with nothing more than conclusions." Ashcroft v. Iqbal , 556 U.S. 662, 678–79, 129 S.Ct. 1937, 173 L.Ed.2d 868 (2009).
To defeat a Rule 12(b)(6) motion to dismiss, a plaintiff must "nudge their claims across the line from conceivable to plausible" by pleading "enough facts to state a claim to relief that is plausible on its face." Bell Atl. Corp. v. Twombly , 550 U.S. 544, 570, 127 S.Ct. 1955, 167 L.Ed.2d 929 (2007). In other words, a plaintiff must establish "more than a sheer possibility that a defendant has acted unlawfully." Ashcroft , 556 U.S. at 678, 129 S.Ct. 1937. Determining whether a complaint states a plausible claim for relief is "a context-specific task that requires the reviewing court to draw on its judicial experience and common sense." Id. at 679, 129 S.Ct. 1937.
In evaluating a motion to dismiss, courts may need to engage in statutory interpretation. In analyzing the text, this Court undertakes "the traditional means of statutory interpretation, which include the text itself, its history, and its purpose." Bellum v. PCE Constructors, Inc. , 407 F.3d 734, 739 (5th Cir. 2005). The Supreme Court and Fifth Circuit prefer the statute's plain meaning unless doing so leads to an absurd result. Hartford Underwriters Ins. Co. v. Union Planters Bank, N. A. , 530 U.S. 1, 6, 120 S.Ct. 1942, 147 L.Ed.2d 1 (2000) ; Bellum , 407 F.3d at 739. With that, the Court turns to the merits of Plaintiffs’ claims.
III. DISCUSSION
Plaintiffs contend that the Fee enacted by the Ordinance violates the WRDA-86 in the following ways:
a. WRDA permits a non-Federal sponsor to levy fees only in conjunction with a harbor navigation project "whose construction is complete (including a usable increment of the project)." 33 U.S.C. § 2236(a). The Ordinance violates WRDA because it permits SNND to prospectively collect User Fees for incomplete, unusable increments of the Project.
b. WRDA contemplates that a project may include multiple navigational features—such as channel deepening
features or anchorage basin features—and requires that fees be levied on a feature-by-feature basis. Moreover, some vessels are exempt from paying fees for certain navigational features. For deepening features, WRDA prohibits assessing a fee against any vessel that, based on its design draft, could have used the waterway before construction of the project. 33 U.S.C. § 2236(a)(3). And as to certain other specific project features enumerated in the statute, "only vessels at least comparable in size to those used to justify these features may be charged" the fee. Id. The Project at issue here includes multiple navigational features. But, the Ordinance fails to levy the User Fee on a feature-by-feature basis and improperly levies fees against exempt vessels.
c. WRDA caps the total amount of fees the non-Federal sponsor may levy in two respects. First, the fee must be limited to the non-Federal share of construction costs (as opposed to total construction costs). Second, the fee must be limited to 25% of total construction costs. The Ordinance fails to impose these statutorily-required limits because: (i) the Ordinance contemplates collecting User Fees for "all" construction costs "associated with the Project" and not merely the non-Federal share; and (ii) even if such a limit existed, the Ordinance further fails to limit the amount of User Fees to 25% or less of the total construction costs.
d. WRDA requires non-Federal sponsors to levy fees on a "fair and equitable" basis. The Ordinance, however, improperly levies User Fees on vessels carrying hydrocarbon cargo at a rate at least 1000% greater than the rate for vessels carrying non-hydrocarbon cargo.
[Dkt. 1 at ¶ 8]. Plaintiffs request monetary damages in the amount of the Fee already paid by BG as well as injunctive and declaratory relief. The Court evaluates each of these contentions in turn and concludes that Plaintiffs do not state a claim for which relief can be granted.
i. Count I
The Court dismisses Count I of the Complaint because it rests on a fundamental misunderstanding of the WRDA-86. Plaintiffs contend that Defendant's Fee is unlawful because it funds incomplete portions of the Project in violation of 33 U.S.C. § 2236. This statute permits the non-Federal interest, Defendant, to levy harbor fees to finance construction:
Port or harbor dues may be levied only in conjunction with a harbor navigation project whose construction is complete (including a usable increment of the project) and for the following purposes and in amounts not to exceed those necessary to carry out those purposes:
(A)(i) to finance the non-Federal share of construction and operation and maintenance costs of a navigation project for a harbor under the requirements of section 2211 of this title.
§ 2236(a)(1). Defendant contends that this language permits it to charge the Fee for the entire Project upon completion of a usable increment. Plaintiffs assert that Defendant may only charge the Fee for "(a) a project whose construction is complete; or (b) for a usable increment of a project whose construction is complete." [Dkt. 1 at ¶ 47 (internal quotations omitted)].
Plaintiffs’ reading requires the Court to add language to the statute and is therefore incorrect. Section 2236(a) treats the completion of a usable increment in the same manner as the completion of the entire project; therefore, the non-Federal interest may charge fees for the whole project upon completion of one usable increment. The term "usable increment of the project" defines when a project is considered complete, which in turn triggers the ability to charge a fee. Critically, a usable increment is not synonymous with a harbor navigation project, but a completed harbor navigation project. In this regard, the placement of the parenthetical involving usable increments is instructive. If Congress intended to define "harbor navigation project" as a "usable increment of the project," then it would have placed the parenthetical next to "harbor navigation project" rather than "complete." Furthermore, the lack of the term "usable increment" in Subsection (A)(i) demonstrates the futility of Plaintiffs’ approach. Congress did not add a similar parenthetical in Subsection (A)(i) and, therefore, made clear that harbor fees may finance the "navigation project" as a whole and not merely "a usable increment." Even if "usable increment" and "harbor navigation project" were synonymous in Subsection (a)(1), this does not transform the meaning of "navigation project for a harbor" in Subsection (a)(1)(A)(i). Thus, upon completion of a usable increment, Defendant may charge the Fee to fund the entire Project. In addition, other portions of Section 2236 discuss levying fees based on the characteristics of individual project features. See § 2236(a)(3) ; see also infra Part II.ii. The Court concludes that the distinction between "project feature" and "usable increment" was intentional, in part, because Congress chose to discuss project features in more depth in a different part of the same section.
Plaintiffs also rely on New Orleans Steamship Association v. Plaquemines Port, Harbor and Terminal District for the propositions that Defendant may only charge the Fee on a feature-by-feature basis and for features that have already been completed. 874 F.2d 1018 (5th Cir. 1989). In Plaquemines , a group of ship owners sued a local harbor district for charging emergency-service fees because they believed the fees violated, among other provisions, the WRDA. The Fifth Circuit found that Section 2236 "applies when a port has undertaken a harbor improvement project and not otherwise." Id. at 1024. However, nothing in the statute prohibited port and harbor authorities from charging an emergency-service fee for regular use of the harbor. Id. at 1027. Therefore, that fee did not violate the WRDA.
Although Plaquemines dealt primarily with Section 2236(a)(2), part of the opinion discusses Section 2236(a)(1). This is the opinion's strongest language in support of Plaintiffs’ argument:
Section 2236(a)(1) forbids fees to finance harbor improvements until after the project is complete. Obviously, this prevents nonfederal ports from fraudulently charging for projects that are mere speculation or that suffer from undue delays while under construction. More to the point, it ensures that the fees will be paid by ships that benefit directly from improvements[.]
Plaintiffs cite to other language, but this is the strongest. Regardless, all Plaintiffs’ references to Plaquemines are dicta.
This—and other language regarding Section 2236(a)(1) —is dicta. "A statement is dictum if it could have been deleted without seriously impairing the analytical foundations of the holding and being peripheral, may not have received the full and careful consideration of the court that uttered it." Int'l Truck & Engine Corp. v. Bray , 372 F.3d 717, 721 (5th Cir. 2004). But "if the statement is ‘necessary to the result or constitutes an explication of the governing rules of law,’ it is not dictum." U.S. Bank Nat'l Ass'n v. Verizon Commc'ns., Inc. , 761 F.3d 409, 427–28 (5th Cir. 2014) (quoting Int'l Truck & Engine Corp. , 372 F.3d at 721 ).
Plaquemines ’s discussion of Section 2236(a)(1) is not critical to its holding. First, the Fifth Circuit found that Section 2236 did not apply because the emergency-service fees were not assessed with a harbor improvement project. Plaquemines , 874 F.2d at 1024. Whether the non-Federal interest could charge fees after the project's completion is irrelevant to the holding.
Even if the Fifth Circuit's discussion of Section 2236(a)(1) were precedential, it would not necessarily favor Plaintiff. Although the opinion states that fees are only permissible after construction is complete, the court does not specify whether it is completion of the entire project or simply a usable increment. The statement that "fees will be paid by ships that benefit directly from improvements," Id. at 1026, is similarly unclear. While Plaintiffs contend that the direct beneficiary language requires Defendant to charge on a feature-by-feature basis, the Fifth Circuit's language is vague as to whether ships must benefit from the specific feature of the project or from the project as a whole. Thus, the Plaquemines dicta does not provide Plaintiffs’ claims with enough support to withstand Defendant's Motion to Dismiss.
Charging on a feature-by-feature basis would only permit Fees for those features that Plaintiffs actually use, rather than a single Fee for using any portion of the Project.
ii. Count II
In Count II, Plaintiffs assert that the Project should assess the Fee on a feature-by-feature basis. Plaintiffs principally rely on 33 U.S.C. § 2236(a)(3) :
While there may be situation in which certain vessels are exempt from Harbor Fees, this is not one of them.
a. Port or harbor dues may not be levied under this section in conjunction with a deepening feature of a navigation improvement project on any vessel if that vessel, based on its design draft, could have utilized the project at mean low water before construction. In the case of project features which solely—
i. widen channels or harbors,
ii. create or enlarge bend easings, turning basins or anchorage areas, or provide protected areas, or
iii. remove obstructions to navigation,
only vessels at least comparable in size to those used to justify these features may be charged under this section.
The Court distills this provision into two limitations: (1) the Design Draft Limitation; and (2) the Size Limitation.
(A) The Design Draft Limitation
First, Section 2236(a)(3) limits the fees that may be assessed for a "deepening feature of a navigation project":
Port or harbor dues may not be levied under this section in conjunction with a deepening feature of a navigation improvement project on any vessel if that vessel, based on its design draft, could have utilized the project at mean low water before construction.
§ 2236(a)(3)(A). Plaintiffs assert that Defendant may only charge ships for features that they would not be able to use but for the Project's improvements. Accordingly, Plaintiffs believe that Defendant's Fee violates the statute because it charges all vessels with a design draft in excess of twenty feet for all Project features.
This reading ignores the statute's plain meaning: a vessel must be able to utilize the entire project before construction to avoid post-construction fees. Courts assume that the legislature intended different meanings when "the legislature uses certain language in one part of the statute and different language in another[.]" Sosa v. Alvarez-Machain , 542 U.S. 692, 711 n.9, 124 S.Ct. 2739, 159 L.Ed.2d 718 (2004) (internal quotation marks omitted). Here, the statute requires that the vessel be able to use the "project" prior to construction. § 2236(a)(3)(A). The Court interprets this language to mean that a ship must be able to use every feature of the project prior to construction to avoid paying the fees associated with project improvements. It is immaterial that a vessel can use certain features before the project but not others—"features" is specific to a project's subparts, while "project" refers to the entire project. If Congress intended to charge harbor fees on a feature-by-feature basis, it could have used the term "deepening feature" in lieu of "project." Indeed, Congress used the term "project features" in the next sentence of the statute ("In the case of project features ...."). Id. Because Congress used the term "project features" in a different part of the same statute, the Court infers that this distinction was intentional. At least one other court has similarly found that the exemption only applies to "any vessel that could have utilized the harbor without the improvement." Maher Terminals, LLC v. Port Auth. of N.Y. and N.J. , No. 2:12-6090, 2014 WL 3590142, at *11 (D.N.J. July 21, 2014), aff'd , 805 F.3d 98 (3d. Cir. 2015) (emphasis added).
Here, Plaintiffs’ ships could not have utilized the whole Waterway prior to construction. For example, before the Project, Anchorage Basin No. 1 had a draft above twenty feet, meaning that it was fewer than twenty feet deep. [Dkt. 5 at 2]. Plaintiffs’ ships subject to the Fee have design drafts in excess of twenty feet. [Dkt. 1-2]. A ship cannot make port or sail in water that is shallower than its design draft. Therefore, Plaintiffs’ vessels could not have used the entire Waterway prior to construction. Plaintiffs’ ships are subject to the Fee.
It is possible that a ship may not have been able to use the usable increment, such as Anchorage Basin No. 1, either before or after the improvement. But to avoid the fee, the statute only requires that the ship be able to use the entire project before construction. The Court takes no opinion on an improvement that only improves portions of a harbor that a ship could not use both before and after construction.
As they do in Count I, Plaintiffs rely on Plaquemines for the proposition that only those ships that actually benefit from the improvements may be charged for those improvements. Plaquemines , 874 F.2d at 1026 ("[the statute] ensures that the fees will be paid by ships that benefit directly from improvements"). As explained, this is dicta. And, even if precedential, this proposition does not provide Plaintiffs with the level of support they believe it does. The Fifth Circuit did not claim that the ships subject to the fee needed to benefit from every single element of the improvement project. Rather, the Fifth Circuit required that the ships obtain some direct benefit from the project. This Project is multifaceted. It is immaterial that Plaintiffs’ ships do not benefit from every feature. (B) The Size Limitation
Section 2236(a)(3) imposes fee limitations for certain features of harbor improvement projects. However, these limitations are inapplicable to Plaintiffs. The statute provides that:
In the case of project features which solely—
i. widen channels or harbors,
ii. create or enlarge bend easings, turning basins or anchorage areas, or provide protected areas, or
iii. remove obstructions to navigation,
only vessels at least comparable in size to those used to justify these features may be charged under this section.
§ 2236(a)(3). Plaintiffs complain that numerous features of the Project incorporate the above limitations:
The Project involves several navigational features, including: (i) deepening the Waterway from 40 to 48 feet; (ii) deepening the offshore channel portion of the Waterway (up to the Port of Beaumont Turning Basin) from 42 to 50 feet, (iii) extending the 50-foot deep offshore channel by approximately 13.2 miles to deep water in the Gulf, increasing the total length of channel from approximately 64 to 77 miles, (iv) tapering and marking the Sabine Bank Channel from 800 feet wide to 700 feet wide, (v) deepening and widening the Taylor Bayou channels and turning basins, (vi) easing selected bends on the Sabine-Neches Canal and Neches River Channel, and (vii) constructing new and enlarging/deepening existing turning and anchorage basins on the Neches River Channel.
This language is derived from the Project Partnership Agreement. [Dkt. 5-7 at 1–2].
[Dkt. 1 at ¶ 26]. Only one of these features "solely" conforms to the limitations of Section 2236(a)(3) : feature (vi). However, Plaintiffs assert that many features meet Section 2236(a)(3)(A) ’s criteria. This is because Plaintiffs improperly define "solely."
Plaintiffs argue that it is inappropriate to group improvements to the same portion of the Project together. Instead, Plaintiffs contend that each improvement to each portion of the Project should be assessed individually. This ignores the plain meaning of the statute, which requires the Court to evaluate each feature and all the improvements made to that feature. Therefore, only those project features that solely "widen," "create or enlarge," or "remove obstructions" can be considered. See § 2236(a)(3). Plaintiffs’ reading would render the word "solely" meaningless, which violates the cannon against surplusage—"the presumption that each word Congress uses is there for a reason." Advoc. Health Care Network v. Stapleton , ––– U.S. ––––, 137 S. Ct. 1652, 1659, 198 L.Ed.2d 96 (2017) ; see also Williams v. Taylor , 529 U.S. 362, 404, 120 S.Ct. 1495, 146 L.Ed.2d 389 (2000) ("we must give effect, if possible, to every clause and word of a statute.") (internal citations omitted). The word "solely" indicates that Congress intended for each project feature to be evaluated in light of all the improvements performed on that feature. Therefore, the Court must evaluate every feature to determine whether the feature solely engaged in any of the activities enumerated in Section 2236(a)(3)(A). Features (i)–(iii) only engage in deepening. Feature (iv) narrows, rather than widens, the channel. Feature (v) deepens and widens certain channels and basins. Feature (vii) deepens turning basins and anchorage areas, in addition to creating and enlarging them.
For example, instead of evaluating feature (v) as both "deepening and widening the Taylor Bayou channels and turning basins" Plaintiffs’ reading would have the Court separate (v) into deepening the Taylor Bayou channels and turning basins, and also widening the same. When taken separately, Plaintiffs claim the feature solely engages in widening a channel or harbor.
To deepen is not to enlarge. However, the statute uses "deepening" in the Draft Limitation. By using "deepening" in one part of the statute and "enlarge" in another, Congress intentionally distinguished the meaning of these words. See Sosa , 542 U.S. at 711 n.9, 124 S.Ct. 2739 ("when the legislature uses certain language in one part of the statute and different language in another, the court assumes the different meanings were intended.").
This leads the Court to feature (vi), which solely engages in creating or enlarging bend easing and turning basins. Because this feature meets the first prong of the Size Limitation, the Court must determine whether Plaintiffs’ ships are "at least comparable in size to those used to justify these features[.]" § 2236(a)(3). Courts have broad discretion when comparing boats’ sizes, which is evidenced by the statute's plain meaning. The statute only requires that the boats subject to the fee be "at least comparable in size." § 2236(a)(3)(A) (emphasis added). By using the term "at least," Congress clarified that this is not an exacting inquiry. The boats subject to the fee need not be the same size or even within a few feet of the ship used to "justify" the project features (the "design ship"). Rather, they need only be at least comparable in size to be subject to the fee for that feature. Furthermore, courts may consider numerous additional factors under Section 2236(a)(3)(B), such as: elapsed time of passage; safety of passage; vessel economy of scale; under-keel clearance; vessel draft; vessel squat; vessel speed; sinkage; and trim. § 2236(a)(3)(B). Congress further expanded the district courts’ discretion by allowing them to evaluate these additional factors beyond a ship's basic dimensions.
In its Motion to Dismiss, [Dkt. 5], Defendant asserts that the design ship is a 158,000 DWT Suez Supermax Tanker, which is the ship that the USACE used in its feasibility study. [Dkt. 5-10 at 12]. This is not so. The design ship is the ship that the project was meant to benefit: any ship with a design draft in excess of twenty feet. Fees may only be levied on "vessels at least comparable in size to those used to justify these features[.]" § 2236(a)(3)(A) (emphasis added). The Court's reading of this provision turns on the word "justify," which Merriam-Webster dictionary defines as "to provide or be a good reason for (something)." Justify, Merriam Webster Dictionary , https://www.merriam-webster.com/dictionary/justify (last visited February 23, 2022). This definition necessarily looks to the benefits created by someone or something. In the context of the Size Limitation, this Court must look to the benefits the features create and to whom those benefits were designed to inure. This is because the beneficiaries of a harbor improvement project should bear the brunt of its costs.
The Court takes judicial notice of the feasibility study prepared by the USACE. See Fed. R. Evid. 201(b) ; see also Funk v. Stryker Corp. , 631 F.3d 777, 783 (5th Cir. 2011) (permitting judicial notice of documents produced by a federal agency).
The Project was designed to benefit ships with design drafts in excess of twenty feet. Although the USACE design ship may be helpful in determining certain characteristics for the Project, the Project itself was not meant to exclusively benefit Suez Supermax Tankers. As the Ordinance asserts: "a User Fee as set out below reflects the benefits provided by the Project to vessels whose design draft exceeds 20 feet." [Dkt. 1-1 at 3]. Therefore, any ship with a design draft in excess of 20 feet may be considered "at least comparable in size to those used to justify these features" and therefore "may be charged under this section." See § 2236(a)(3).
Even if the design ship were a 158,000 DWT Suezmax Tanker ("Suezmax Design Ship"), the Court's decision would not change. Plaintiffs’ ships that have thus far been subject to the fee are comparable in size to the Suezmax Design Ship. See [Dkt. 5-10 at 12].
The Court already possesses sufficient legal and evidentiary support that the Fee complies with the Size Limitation. Even so, the Court finds it significant that Defendant, as the non-Federal interest, determined that ships with design drafts in excess of twenty feet justified the Project features. [See Dkt. 1-1 at 3]. The statute delegates authority to non-Federal interests in determining which ships are "at least comparable in size to those used to justify these features." § 2236(a)(3). Section 2236(a)(3)(B) reads: "In developing port or harbor dues that may be charged under this section on vessels for project features constructed under this subchapter, the non-Federal interest may consider such criteria as ...." § 2236(a)(3)(B) (emphasis added). By delegating authority to the non-Federal interest in crafting the fee, Congress intended to give broad discretion in determining the size of the ship used to justify project features and which vessels are "at least" comparable in size.
The statutory scheme of the WRDA is a prime example of the cooperative federalism that permeates the administrative state. Enlarging federal programs requires investment and execution by state and local actors. However, this increased cooperation leaves courts grappling with whether to afford deference to state agency interpretations of federal law. With scarce precedent, the Court finds Voigt v. Coyote Creek Mining Co., LLC influential. 999 F.3d 555 (8th Cir. 2021). In Voigt , the Eighth Circuit grappled with whether to afford deference to a state agency given permitting authority under the Clean Air Act, 42 U.S.C. § 7401, et seq. On its first appeal, the court determined that the state agency's permitting decision should be afforded deference. Voigt v. Coyote Creek Mining Co., LLC , 980 F.3d 1191 (8th Cir. 2020), aff'd on reh'g on other grounds , 999 F.3d 555 (8th Cir. 2021). However, on rehearing, the court sidestepped the issue, finding for the defendant on alternate grounds. Voigt , 999 F.3d at 562. While the court did not explicitly rule on whether deference was appropriate, it found that the state agency's "permitting decision [was] a useful guide in reaching [its] decision regarding the most reasonable interpretation of the regulations[.]" Id.
Although the Eighth Circuit did not give deference to the state agency's decision, it did not rule out the possibility of affording such deference. The court appeared to apply prior Supreme Court rulings, and the factors therein, regarding deference to federal agency decisions to the decisions of the state agency. Regardless, it is not within the providence of this Court to create doctrine.
Public policy supports applying the Eighth Circuit's logic here: granting the non-Federal interest some leeway will provide future vessel and cargo owners with a manageable standard for determining whether their vessels will be subject to the fee, so they will not need to petition the Court for guidance. Such frequent, individualized determinations would be unworkable and kill any harbor construction project. Accordingly, the Court treats Defendant's decision to charge vessels with design drafts in excess of twenty feet as a significant but non-dispositive factor when deciding whether Plaintiffs’ ships are comparable in size. To clarify, non-Federal interests do not have carte blanche to levy harbor fees. The Court merely finds significance in SSND's, the non-Federal interest's, determination that a certain size ship was used to justify the Project, and SSND has broad discretion in determining which ships "are at least comparable in size[.]" § 2236(a)(3)(A).
iii. Count III
Count III rests on a misinterpretation of the Ordinance and is not ripe for adjudication. It contends that the Ordinance enacting the Fee is unlawful because it allows Defendant to use the Fee to fund construction costs for the entire Project, rather than for only the non-Federal share. Plaintiffs read the Ordinance improperly. But, even if their reading of the Ordinance was correct, their claim is not yet ripe.
The Ordinance reads: "User Fee authorized by this ordinance will expire on January 1, 2049, or upon final payment of all construction and construction financing costs associated with the Project, whichever comes first." [Dkt. 1 at ¶ 65; Dkt. 1-1 at 6 (emphasis added)]. By setting the expiration of the Fee after "all" construction costs are paid, Plaintiffs assert that the Ordinance permits levying the Fee for costs related to both the federal and non-Federal shares of the Project, in violation Section 2236(a)(1)(A)(i). The statute permits fees only "to finance the non-Federal share of construction and operation and maintenance costs of a navigation project for a harbor under the requirements of section 2211 of this title[.]" § 2236(a)(1)(A)(i). The complained-of portion of the Ordinance imposes a temporal limitation on Defendant's ability to charge the Fee. It does not, and indeed cannot, mandate that ships subject to the Fee finance the federal portion of Project costs.
Plaintiffs have also not overcome the presumption of regularity that attaches to government actions. Courts presume that government actors act lawfully and do not violate their own regulations. Sealed Appellee 1 v. Sealed Appellant 1 , 767 F.3d 418, 423 (5th Cir. 2013). While this presumption may be overcome, Plaintiffs’ "assertion amounts to nothing more than speculation that the Government may intend to violate its own regulations, which we normally do not assume." Id.
Additionally, Plaintiffs’ claims regarding Count III are speculative and therefore not ripe. "Ripeness is a justiciability doctrine ‘drawn from both Article III limitations on judicial power and from prudential reasons for refusing to exercise jurisdiction.’ " Watkins v. City of Arlington , No. 4:14-CV-381-O, 2015 WL 12733395, at *3 (N.D. Tex. Jan. 8, 2015) (citing Reno v. Catholic Soc. Servs., Inc. , 509 U.S. 43, 57 n.18, 113 S.Ct. 2485, 125 L.Ed.2d 38 (1993) ). It "separates those matters that are premature because the injury is speculative and may never occur from those that are appropriate for judicial review," United Transp. Union v. Foster , 205 F.3d 851, 857 (5th Cir. 2000), and stops courts "from entangling themselves in abstract disagreements over administrative policies ...." Abbott Labs. v. Gardner , 387 U.S. 136, 148–49, 87 S.Ct. 1507, 18 L.Ed.2d 681 (1967), abrogated on other grounds by Califano v. Sanders , 430 U.S. 99, 97 S.Ct. 980, 51 L.Ed.2d 192 (1977). "A court should dismiss a case for lack of ‘ripeness’ when the case is abstract or hypothetical." Monk v. Huston , 340 F.3d 279, 282 (5th Cir. 2003).
When assessing ripeness, courts examine: "(1) the fitness of the issues for judicial resolution, and (2) the potential hardship to the parties caused by declining court consideration." Lopez v. City of Hous. , 617 F.3d 336, 341 (5th Cir. 2010) (citing Texas v. United States , 497 F.3d 491, 498 (5th Cir. 2007), cert. denied , 555 U.S. 811, 129 S.Ct. 32, 172 L.Ed.2d 18 (2008) ). When declaratory judgment is sought, courts also determine, (3) whether the case "presents sufficient adversity and concreteness by examining whether an ‘actual controversy’ exists between the parties." Bear Creek Bible Church v. EEOC , No. 4:18-cv-00824-O, 571 F.Supp.3d 571, 597 (N.D. Tex. Nov. 11, 2021) (citing Orix Credit Alliance, Inc. v. Wolfe , 212 F.3d 891, 896 (5th Cir. 2000) ).
First, "[a] case is generally ripe" and fit for review "if any remaining questions are purely legal ones." New Orleans Pub. Serv., Inc. v. Council of City of New Orleans , 833 F.2d 583, 587 (5th Cir. 1987). However, a case may still be unfit for adjudication even if the legal issues are clear:
[T]he question of fitness does not pivot solely on whether a court is capable of resolving a claim intelligently, but also involves an assessment of whether it is appropriate for the court to undertake the task. Federal courts cannot—and should not—spend their scarce resources on what amounts to shadow boxing. Thus, if a plaintiff's claim, though predominantly legal in character, depends on future events that may never come to pass, or that may not occur in the form forecasted, then the claim is unripe.
Ernst & Young v. Depositors Econ. Prot. Corp. , 45 F.3d 530, 537 (1st Cir. 1995). This is the case here. Plaintiffs have not alleged that Defendant is using the Fee to fund the federal portion of construction costs, just that they might do so in the future. This is speculation, and Plaintiffs require further factual development to successfully lodge this claim. Furthermore, Plaintiffs have not demonstrated that they meet the "hardship" prong of the analysis. For example, Plaintiffs have not pled that Defendant has turned over the Fees to the federal government. Dismissal is warranted.
iv. Count IV
Count IV of Plaintiffs’ Complaint must be dismissed because Section 2211 does not impose a cap on the non-Federal interest's spending. This Count alleges that Defendant is using the Fee to fund a larger portion of project costs than the statute permits. Section 2236(a)(1) permits non-Federal interests to levy fees in "amounts not to exceed those necessary ... to finance the non-Federal share of construction and operation and maintenance costs of a navigation project for a harbor under the requirements of section 2211 [.]" 33 U.S.C. § 2236(a)(1)(A)(i) (emphasis added). Pursuant to Section 2211 :
The non-Federal interests for a navigation project for a harbor ... shall pay , during the period of construction of the project, the following costs associated with general navigation features: ... (B) 25 percent of the cost of construction of the portion of the project which has a depth in excess of 20 feet but not in excess of 50 feet[.]
33 U.S.C. § 2211(a)(1)(B) (emphasis added). By limiting the use of fees to "amounts not to exceed those necessary" to finance a harbor improvement project, Plaintiffs claim that Section 2211 imposes a cap on fee collection for non-Federal interests. Plaintiffs concede that non-Federal interests may contribute more than twenty-five percent of the cost of construction. [Dkt. 23 at 24–25]. However, they claim Defendant may not use port fees to fund any voluntary additional cost sharing.
Plaintiffs’ reading is incorrect. The language of limitation in Section 2236 does not transform the percentages of Section 2211 into a cap on non-Federal funding. Rather, it limits what the fee may fund to construction, operation, and maintenance costs. Plaintiffs are not exempt from paying their share of costs through a user fee merely because the non-Federal interest assumes a larger percentage of project costs. And Plaintiffs’ concession that Defendant may voluntarily assume a greater portion of the Project's costs undermines their argument. It cannot be that Section 2211 imposes a cap for the fee-based non-Federal share but not for the alternatively funded non-Federal share because that reading would require an express statutory provision. Section 2236(a)(1) ’s language—"amount not to exceed those necessary"—is not enough.
Even without Plaintiffs’ concession, the law itself expressly permits non-Federal interests to assume a higher share of project costs. Under 33 U.S.C. § 2280, the projected costs listed in WRDA-14 form the maximum federal share of project costs. § 2280(a). However, Section 2280(b) expressly permits "the Secretary [to] accept funds from a non-Federal interest for any authorized water resources development project that has exceeded its maximum cost under subsection (a), and use such funds to carry out such project, if the use of such funds does not increase the Federal share of the cost of such project." § 2280(b). This clear mandate permits non-Federal interests to contribute additional funds within their discretion.
Although the statute was originally enacted in 1986, it expressly encompasses projected costs listed in any subsequent WRDA enactment: "In order to insure against cost overruns, each total cost set forth with respect to a project for water resources development and conservation and related purposes authorized to be carried out by the Secretary in this Act or in a law enacted after the date of the enactment of this Act, including the Water Resources Development Act of 1988, or in an amendment made by this Act or any later law with respect to such a project shall be the maximum cost of that project[.]" 33 U.S.C. § 2280(a) (emphasis added).
Even without Section 2280(b) ’s command, Plaintiffs’ reading requires that the Court view the percentages listed in Section 2211 as a cap on the non-Federal share. However, nothing in the statute's text or legislative history suggests this. The term "shall pay" indicates that Section 2211 imposes either a spending floor or discretionary guidelines for cost sharing between federal and non-Federal interests. The Supreme Court has found that ‘shall’ can be mandatory or precatory. See Maine Cmty. Health Options v. United States , ––– U.S. ––––, 140 S. Ct. 1308, 1320, 206 L.Ed.2d 764 (2020) (holding that ‘shall’ indicates a mandatory requirement); see also Cairo & F.R. Co. v. Hecht , 95 U.S. 168, 170, 24 L.Ed. 423 (1877) (noting ‘shall’ means ‘may’ in certain contexts); Gutierrez de Martinez v. Lamagno , 515 U.S. 417, 429–30, 115 S.Ct. 2227, 132 L.Ed.2d 375 (1995) ; Castle Rock v. Gonzales , 545 U.S. 748, 760–62, 125 S.Ct. 2796, 162 L.Ed.2d 658 (2005) (concluding that the word "shall" should not be read as requiring the police to take action); West Wis., Ry. Co., v. Foley , 94 U.S. 100, 103, 24 L.Ed. 71 (1877).
The Court need not rule on whether the percentages in Section 2211 are mandatory or precatory because the result would be the same. Should Section 2211 be read as precatory, then non-Federal interests would be able to assume a larger or smaller portion of project costs. This variable cost structure would afford discretion in determining the breakdown of project costs.
However, if the statute is read as mandatory, such percentages form a minimum contribution from non-Federal interests. It is clear from the statute's legislative history that Congress intended to increase the involvement of non-Federal interests in constructing and improving America's ports. Prior to the WRDA-86, Congress appropriated funds for only three to four projects every year. 132 Cong. Rec. S3402 (1986). Because of the fierce competition to secure funding, influence within the people's chamber became more important than need. Id. By requiring local investment, Congress incentivized only those non-Federal interests that actually needed harbor improvements to apply for the funding. Id. Given this motivation to involve non-Federal interests in "bidding" for congressional funding, it would be absurd to think that Section 2211 forms a ceiling because it would deprive local interests of the ability to demonstrate the need for congressional funds. A principal co-sponsor of the statute, Representative Glenn Anderson, noted that "[n]ew cost-sharing rules have been implemented, which are nearly identical to those proposed by the administration, that require non-Federal interests to pay a much greater share of project costs." 132 Cong. Rec. 11561 (1986). It is unlikely that Congress desired the inclusion of non-Federal funds but imposed a cap on such funding. Rather, the twenty-five percent minimum assured that the non-Federal interest had a concrete stake in a project's success.
Furthermore, subsequent congressional enactments on cost sharing for harbor improvement projects demonstrate that Section 2211 imposed minimum contribution levels. Where two statutes "deal with precisely the same subject matter," they may be read in pari materia. United States v. Stewart , 311 U.S. 60, 64, 61 S.Ct. 102, 85 L.Ed. 40 (1940). All statutes "in pari materia are to be taken together, as if they were one law." Id. ; see also Cope v. Cope , 137 U.S. 682, 687–88, 11 S.Ct. 222, 34 L.Ed. 832 (1891) ; United States v. Freeman , 3 How. 556, 564, 11 L.Ed. 724 (1845).
The WRDA-86 and the WRDA-14 are to be read in pari materia. Both statutes deal with harbor expansion projects and provide a cost breakdown for the federal and non-Federal share. For this Project, Congress provided a projected split of $748,070,00 in federal funding and $365,970,000 in non-Federal funding for the Project. These amounts, which exceed the percentages listed in Section 2211, reflect congressional intent to depart from the percentages in Section 2211.
v. Count V
Section 2236(a)(4) of WRDA-86 provides that "dues may be levied only on a vessel entering or departing from a harbor and its cargo on a fair and equitable basis." 33 U.S.C. § 2236(a)(4). Plaintiffs contend that the Fees are unlawful because SNND imposes a higher Fee on hydrocarbon cargo than non-hydrocarbon cargo with no "legitimate justification." [Dkt. 1 at ¶ 82]. The Court disagrees and finds that this discrepancy is reasonable.
The Fee for hydrocarbon cargo is $0.20 per short ton with a maximum of $0.35 per short ton, and the Fee for non-hydrocarbon cargo is $0.02 per short ton with a maximum of $0.035 per short ton. [Dkt. 1-1 at 7]. This discrepancy is reasonable based on the Section 2236(a)(4) factors for the non-Federal interest to consider when formulating fees:
a. the direct and indirect cost of construction, operations, and maintenance, and providing the facilities and services under [ 33 U.S.C. § 2236(a)(1) ];
b. the value of those facilities and services to the vessel and cargo;
c. the public policy or interest served; and
d. any other pertinent factors.
SNND reasonably decided to impose disparate Fees depending on the type of cargo so that: (1) the vessels and cargo benefitting the most from the improvements would fund the majority of the costs; (2) the Fee remains approximately equal when measured as a percentage of the cargo's value; and (3) the Fee furthers public policy by "funding improvements intended to secure the Waterway's position as America's leading import/export harbor for hydrocarbons." [Dkt. 5 at 31].
When calculating harbor fees, a non-Federal interest must consider "the value of" the facilities "to the vessel and cargo" pursuant to Section 2236(a)(4)(B). The Project itself was designed to benefit the hydrocarbon industry, and hydrocarbons make up a substantial percentage of the tonnage for both Beaumont and Port Arthur. [Dkt. 5-10 at 4, 8]. SNND determined it was proper to charge hydrocarbon carriers more because the improvements were largely geared to their benefit. [Dkt. 5 at 32]. Whether hydrocarbon carriers are the only vessels that would benefit from deeper channels is not dispositive. The same is true for whether all hydrocarbon cargoes are more valuable than all non-hydrocarbon cargoes. The only material question is whether SNND appropriately considered this factor when crystallizing the Project's plan. The Court finds that SNND did so. Imposing higher fees on hydrocarbon carriers also comports with the statute because it better reflects the value that the facilities add to the vessel and cargo. This is because the value of hydrocarbon cargo per ton is generally much higher than the value of non-hydrocarbon cargo. Additionally, SSND and USACE created the Project, in part, to benefit the hydrocarbon industry. [Dkt. 5-3 at 3, 7, 12–14]. Thus, the Fee is equitable when considering the "value of those facilities and services to the vessel and cargo." § 2236(a)(4)(B).
Plaintiffs argue that the Court may not take judicial notice of Exhibit 9, [Dkt. 5-10], because it is from 2011; therefore, it cannot be used to determine the Waterway's hydrocarbon traffic in 2021 when the Ordinance was passed. But Defendant does not ask the Court to forward-model 2021 statistics from the feasibility study, nor does the Court need to engage in this exercise. The feasibility study is cited and noted for the purpose of showing those factors that SNND considered when formulating the Project and its Fees. Furthermore, the Court may take judicial notice of "publicly-available documents and transcripts produced by [government agencies], which were matters of public record directly relevant to the issue at hand." Funk v. Stryker Corp. , 631 F.3d 777, 783 (5th Cir. 2011). Thus, the Court takes judicial notice of the Feasibility Report.
SNND need not "draw the perfect line"—just a "rational line." See Armour v. City of Indianapolis , 566 U.S. 673, 685, 132 S.Ct. 2073, 182 L.Ed.2d 998 (2012).
As Defendant explains in its Motion to Dismiss:
By way of illustration, in April 2021—the month when the Ordinance was passed—statistics published by the U.S. Energy Information Administration indicated that the price of American LNG for export was about $5.92 per thousand cubic feet, or about $318 per short ton (given that 1 short ton is 53,682.56 cubic feet). Natural Gas , U.S. Energy Info. Admin. (Sept. 30, 2021), https://bit.ly/3l8RAag. A 20-cent harbor due on cargo worth $318 per ton equates to dues of about 0.063% based on the value of the cargo. The average price for of nonhydrocarbon cargo tends to be much lower, often around $30 per ton (e.g., $28 per ton for iron and steel slag, $29 per ton for peat, $33 per ton for pumice rock, and between $35 and $50 per ton for sand and gravel). See U.S. Dep't of Interior, U.S. Geological Survey, Mineral Commodity Summaries 2020 , at 86, 118, 128, 142 (Jan. 2020), https://on.doi.gov/3D3Bh4S. A 2-cent harbor due on cargo worth $30 per ton equates to dues of 0.066% based on the value of the cargo—almost exactly the same as the dues for hydrocarbons.
[Dkt. 5 at 25 n.12]. The Court may take judicial notice of these government statistics because their accuracy and source cannot be questioned. Fed. R. Evid. 201(b) ; Funk , 631 F.3d at 783 ; Victoria Cruises, Inc. v. Changjiang Cruise Overseas Travel Co. , 630 F. Supp. 2d 255, 263 n.3 (E.D.N.Y. 2008).
Furthermore, a non-Federal interest must also consider public policy. § 2236(a)(4)(C). The Project itself is intended to benefit the hydrocarbon industry. [Dkt. 5-3 at 3, 7, 12–14]. The Ordinance itself expressly states that the Navigation District's Board of Commissioners considered the statutory factors like "the cost of construction, operations, [and] the value of the services to the vessel and cargo." [Dkt. 1-1 at 3]. Therefore, this Court concludes that SNND reasonably imposed a higher Fee for hydrocarbon carriers because it considered and applied the relevant statutory factors.
vi. Counts VI & VII
Count VI seeks a declaratory judgment that Defendant's Fee violates the WRDA-86 and is therefore unenforceable. Count VII seeks an injunction barring SNND from implementing the Fee. Both are pendant upon Plaintiffs’ previous allegations, Counts I through V. Because Counts I through V are dismissed, the Court also dismisses Counts VI and VII. See Adams v. Nissan N. Am., Inc. , 395 F. Supp. 3d 838, 856 (S.D. Tex. 2018) ("Defendant correctly contends that Plaintiffs’ claims for declaratory and injunctive relief are derivative of their other claims, and if the other claims are dismissed, so too must the claims for declaratory and injunctive relief be dismissed.").
vii. Leave to Amend
A district court may deny leave to amend when "the proposed amendment would be futile because it could not survive a motion to dismiss." Rio Grande Royalty Co. v. Energy Transfer Partners, L.P. , 620 F.3d 465, 468 (5th Cir. 2010) ; see also Foman v. Davis , 371 U.S. 178, 182, 83 S.Ct. 227, 9 L.Ed.2d 222 (1962) (holding that denying leave to amend is within the trial court's discretion so long as there is an appropriate reason given, including futility). An amended complaint is futile when the plaintiff has pled his or her best case, and there are no "additional facts that could be alleged in a second amended complaint that could not have been alleged in the [original complaint]." Heck v. Orion Grp. Holdings, Inc. , 468 F. Supp. 3d 828, 863 (S.D. Tex. 2020).
Here, there are no additional facts that Plaintiffs may plead that would change the outcome of this Court's decision. This case rests on issues of law, and there is no reasonable possibility that a change in facts would lead to a change in outcome—any attempts at amendment are futile. Therefore, this case is dismissed with prejudice and leave to amend is not given.
IV. CONCLUSION
After a careful review of all pleadings, facts, and applicable law, this Court reaches a decision on Defendant's Motion to Dismiss.
It is therefore ORDERED that Defendant's Motion to Dismiss, [Dkt. 5], is hereby GRANTED.
It is further ORDERED that Counts I-VII of Plaintiffs’ Complaint, [Dkt. 1], are hereby DISMISSED WITH PREJUDICE.
It is further ORDERED that Parties’ Joint Motion for Protective Orders [Dkt. 34] is hereby DENIED AS MOOT.