In California, water issues are of top concern. So, all eyes should be on Washington now as the U.S. Supreme Court is poised to potentially take-up two major cases that may affect water policies in the Central Valley for years to come. The cases, Stewart Jasper Orchards v. Jewell and State Water Contractors v. Jewell, are about water rights for Californians and they tell a story of environmental regulation gone wild.

As we know too well, ranchers and farmers are hurting under severe drought conditions throughout California. These troubles are only exacerbated by the federal government’s Endangered Species Act (ESA) regulations, which are forcing additional water restrictions, in the Central Valley, for the benefit of the Delta Smelt, a pinky sized fish that has no commercial value. These restrictions prevent farmers and ranchers from receiving their full water allocations—meaning precious rain water and snow-melt is passing into the San Francisco Bay while agricultural communities are running dry. In fact early this summer farmers in the Central Valley were forecast to get “zero allocation” in order to protect the Delta Smelt. That projection was revised upward only after we received a little more rain than was originally expected. But the farmers still received far less water than they really needed.

Ever since U.S. Fish and Wildlife Services (FWS) began imposing mandatory water restrictions, farmers have been forced to get by with less, or to rely more heavily on their private wells. But, for some, those wells are beginning to run dry. And, as the State moves to limit water that can be tapped from underground reservoirs, things are looking grim.

Many have simply abandoned large sections of their farms—letting crops wither and die—for lack of water. Some have reduced output. Others have simply given up. All of this means fewer opportunities for agricultural workers, and hard times for businesses reliant on agriculture—not to mention rising food costs throughout the nation.

There can be no doubt that these water restrictions have imposed serious hardships on farmers, with major adverse economic impacts on the entire Central Valley economy—if not the country. But the U.S. Fish and Wildlife Service says it has no obligation to think about economic consequences. In their view, the only “economic impact” they need to consider is the cost of enforcing the restrictions—never mind the devastating impacts on California communities.

In the face of a legal challenge, the U.S. Fish and Wildlife Service successfully argued that its sole concern is over protecting the Delta Smelt “whatever the cost.” In other words, it really doesn’t matter how destructive ESA restrictions might be for the human environment—all that matters is that we’re saving this little fish. But this is absurd.

Of course, we aim to be good stewards of the earth by protecting our natural resources. But ultimately environmental regulation should benefit people. It’s clear that Congress wanted a balanced approach to environmental regulation when it enacted, and amended, the ESA to explicitly require Fish and Wildlife Service to consider “economic impacts” of its regulations. Before imposing draconian ESA restrictions, Fish and Wildlife Service should have given serious consideration to the adverse impact water restrictions would have on Central Valley farmers.

After years of litigation, this issue may soon be coming to a head—and, incidentally, at a time when drought conditions have raised the stakes for everyone. The National Federation of Independent Business Small Business Legal Center is asking the U.S. Supreme Court to review a Ninth Circuit Court of Appeal decision, which held that Fish and Wildlife Service may impose restrictions without any consideration of economic consequences. We are urging the high court to take the case because it presents an issue of critical importance to the small business community.

If it is really true that Fish and Wildlife Service has no obligation to consider economic impacts when imposing ESA restrictions, the federal government could shut down the Port of Los Angeles or Oakland in the name of protecting a single organism—without even considering the devastating impact that would have on the national economy. It’s simply inconceivable that Congress would have intended for the Fish and Wildlife Service to ignore devastating impacts on the human environment because the ESA, like all federal environmental regimes, was designed to strike a delicate balance between our societal needs and the needs of the ecological system on which we all depend for continued sustenance.


For more than 70 years, the National Federation of Independent Business has been the Voice of Small Business, taking the message from Main Street to the halls of Congress and all 50 state legislatures. NFIB annually surveys its members on state and federal issues vital to their survival as America’s economic engine and biggest creator of jobs. NFIB’s educational mission is to remind policymakers that small businesses are not smaller versions of bigger businesses; they have very different challenges and priorities. Learn more at