A federal appeals court panel told a Wisconsin tribe this week it can’t review a decision by two federal agencies that reinforced Michigan’s permitting authority over a proposed mine on the Michigan-Wisconsin border.

The Menominee Indian Tribe of Wisconsin filed a lawsuit against the U.S. Environmental Protection Agency and Army Corps of Engineers in 2018 after the agencies failed to address the tribe’s concerns that federal review of a wetlands permit for the mine was warranted.

The tribe alleged the agencies were "arbitrary and capricious" when they declined to exercise authority over the permit for the Back Forty mine. The agencies had delegated that authority to the state of Michigan in 1984.

Toronto-based Aquila Resources sought permits as part of plans to mine gold, zinc and other metals near the Menominee River in Michigan’s Upper Peninsula. The tribe has said the proposed mine threatens the river, burial mounds and other cultural sites that are significant to its members.

"It’s a huge disappointment obviously. We think that delegation is something that should be applied to the river," said Tribal Chairman Douglas Cox.

If permitting for the project rested with federal agencies, they would be required to conduct official consultation with the tribe on the project.

"There’s government-to-government relations and that trust responsibility that the government and those agencies owe the tribe. And, they’ve failed," said Cox. "They’ve entirely failed on this one."

The ruling Monday by a three-judge panel in the 7th U.S. Circuit Court of Appeals means the tribe’s only recourse on the matter lies with Michigan and state courts. However, they questioned the way in which the agencies handled the tribe’s concerns, as well as whether their delegation of permitting authority to Michigan remains valid.

"The court was not happy with the federal agencies, pointing out pretty bluntly that the agencies had given the tribe the runaround," said Janette Brimmer, a staff attorney with the environmental law firm Earthjustice, which is representing the tribe.

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In his opinion, U.S. Circuit Judge Michael Scudder said the tribe "ran into a legal labyrinth and regulatory misdirection" as it sought to protect its cultural heritage.

"Had the federal agencies provided a meaningful response to the Tribe’s concerns, perhaps this suit could have been avoided," wrote Scudder.

U.S. Circuit Judge David Hamilton highlighted a problem with delegation of permitting authority to states in his concurring opinion.

"Under this standard, as uses of particular stretches of waterways may change, so may the legality of a federal delegation of authority to a state," wrote Hamilton. "As applied to the Menominee River near the proposed Back Forty mine, there is a substantial issue whether the original delegation in 1984 remains valid as a matter of federal law."

Both Cox and Brimmer said it’s too early to say what action the tribe will take in response to the appeals court ruling.

"We’re in the fight," said Cox. "We want to continue to assure that our history and our culture is protected and this river’s not harmed."

Officials with the EPA and Army Corps referred remarks on the ruling to the U.S. Department of Justice, which did not immediately return a request for comment Tuesday afternoon.

In the meantime, the tribe continues to contest Michigan's decision to grant a wetlands permit for the mine before the Michigan Department of Environment, Great Lakes and Energy — formerly known as the Michigan Department of Environmental Quality. An administrative law judge has yet to issue findings and recommendations as part of the contested case hearing.

If built, an economic impact study found the Back Forty mine would create more than 240 jobs with an annual payroll of roughly $9.5 million. The construction of the mine is anticipated to cost more than $260 million.