Biotech's ESA Burden Lifted? 'Harm' Rule Ends in 60 Days, Easing Facility Permits

On July 14, 2026, the U.S. Fish and Wildlife Service (FWS) and National Marine Fisheries Service (NMFS) published a final rule in the Federal Register rescinding the regulatory definition of 'harm' under Section 9 of the Endangered Species Act (ESA). This move, effective 60 days later on September 12, 2026, eliminates a decades-old regulatory interpretation that explicitly included indirect habitat modification—such as significant degradation impairing breeding, feeding, or sheltering—as a prohibited 'take.' The Services will now rely solely on the ESA's statutory text, as interpreted by Justice Antonin Scalia's dissent in Babbitt v. Sweet Home Chapter of Communities for a Great Oregon (1995). That dissent argued that 'harm' should be limited to direct, intentional acts of killing or injuring wildlife, not habitat alterations that only indirectly cause such harm. The rescission represents one of the most significant shifts in ESA implementation since the 1970s, fundamentally altering how federal agencies evaluate and enforce take prohibitions against private landowners, developers, and infrastructure projects. Previously, the 'harm' definition, in place since 1981 for FWS and 1999 for NMFS, served as the primary hook for requiring incidental take permits (ITPs) and formal Section 7 consultations for habitat-disturbing activities. Under that regime, virtually any major land-use change—grading, vegetation removal, water operations, renewable energy construction, telecommunications siting—that could impair essential behavioral patterns and lead to wildlife death or injury triggered ESA liability. The new, narrower interpretation dramatically limits that liability by excluding indirect habitat impacts that do not directly kill or injure individual animals. This has profound implications for regulated entities: project proponents may face significantly reduced regulatory burden, fewer consultation requirements, and potentially lower costs. However, the final rule does not adopt any substitute definition, creating immediate uncertainty. The Services have stated they will apply the Sweet Home dissent's reading, but they have not codified what specific activities fall outside 'take.' This ambiguity invites litigation over borderline cases, particularly for widespread, cumulative impacts from development. A coalition of conservation organizations has already announced plans to challenge the rule in federal court, likely arguing it violates the ESA's purpose and the Supreme Court's majority opinion in Sweet Home, which upheld the inclusion of habitat modification. That litigation could delay or reverse the rescission. Additionally, states with their own endangered species statutes—such as California—may continue to impose broader liability regardless of federal changes. For industries spanning energy, telecom, mining, agriculture, and real estate, the rule change offers a potential easing of ESA constraints but also a period of legal limbo. Project proponents are advised not to assume immediate relaxation of incidental take permitting obligations until the rule takes effect and survives court scrutiny. Meanwhile, environmental groups warn that the elimination of the 'harm' definition will remove a critical tool for protecting ecosystems and species recovery, potentially accelerating habitat loss. The agencies' joint announcement on July 10, 2026, and the formal publication on July 14, 2026, cap a rulemaking process that began over a year earlier, signaling a deliberate administrative strategy to narrow ESA enforcement. The outcome will likely reshape ESA consultation, enforcement, and permitting for decades, but its full impact depends on the unresolved interplay between the new agency interpretation, judicial review, and state-level protections.