11 ELR 20179 | Environmental Law Reporter | copyright © 1981 | All rights reserved


Texaco, Inc. v. Andrus

Nos. 79-2448; -2458 (D.D.C. August 15, 1980)

The court rules that owners of alluvial valley floor (AVF) land on which strip mining is prohibited must be offered federal coal-bering land in exchange, and it remands a number of the Bureau of Land Management's (BLM's) regulations for determining the unsuitability of lands for surface coal mining under § 522 of the Surface Mining Control and Reclamation Act (SMCRA). The court reads the legislative history and the language of § 510 of SMCRA to mandate tht if a mine operator owns land with coal deposits located on an AVF, the Secretary of the Interior must exchange federally owned coal-bearing land for the private land. The court rejects defendant's argument that fee exchanges are discretionary because they must be made under § 206 of the Federal Land Policy and Management Act, which vests discretion for fee exchanges with the Secretary. The discretion granted by § 206 allows the Secretary to determine exchange sites, not to determine whether to conduct the exchange at all. Turning to BLM's regulations concerning unsuitability designations under § 522, the court rules that materials incorporated by reference in the preamble to the regulations need not directly accompany the release of the regulations for public comment. However, the court remands regulations which (1) protect endangered species but make no exemptions for substantial preexisting legal and financial commitments under § 522(a)(6), (2) provide extensions to the § 522(e) per se unsuitability categories, (3) shift the burden of proof to mine operators concerning natural hazards that "substantially endanger life and property" under § 522(a)(3)(D), and (4) require approval by a municipality where a lease may affect a municipal watershed under § 522(a)(3)(C). Finally, the court enjoins the Secretary from applying unsuitability criteria, based on laws other than SMCRA, to existing coal leases.

Counsel for Plaintiff Texaco, Inc.
Gerry Levenberg
Van Ness, Feldman & Sutcliffe
Suite 500, 1220 19th St. NW, Washington DC 20036
(202) 331-9400

Counsel for Plaintiff Nat'l Coal Ass'n
Timothy M. Biddle
Crowell & Moring
1100 Connecticut Ave. NW, Washington DC 20036
(202) 452-5800

Counsel for Defendants
Carol L. Green, Alfred T. Ghiorzi
Land and Natural Resources Division
Department of Justice, Washington DC 20530
(202) 633-2738

[11 ELR 20180]

Flannery, J.:

Judgment and Order

This matter comes before the court on cross-motions for summary judgment. Upon review of the memoranda submitted in this case, the applicable law, the arguments offered at oral hearing, and the record herein, it is, by the court, this 15th day of August, 1980,

ORDERED that the following regulations be remanded to the Secretary for revision in accordance with the foregoing Memorandum: 43 C.F.R. §§ 3437.2(a); 3437.1-2(C); 3461.1(i); 3461.1(k); 3461.1(l); 3461.1(m); 3461.1(n); 3461.1(a); 3461.1(p); 3461.1(q)(2)(ii); 3461.4-2(a); and it is further

ORDERED, ADJUDGED and DECREED that the defendants be granted summary judgment with respect to all other matters considered in the foregoing Memorandum.

Memorandum

This case stems from complaints, filed in September, 1979, by the plaintiffs National Coal Association (NCA) and Texaco. The plaintiffs sought originally to consolidate their suits with the major In Re Permanent Surface Mining Regulation Litigation, Civil Action No. 79-1144 [9 ELR 20720]. By order dated October 19, 1979, the court denied consolidation. The court did, however, consolidate the NCA and the Texaco suits.

The rationale for denying consolidation with the major suit is straightforward. In re Permanent entails challenges to regulations promulgated by the Department of Interior's Office of Surface Mining (OSM). That suit addresses the relation between federal and state regulatory agencies and the degree of regulation of mining activities and reclamation operations. The instant suit, however, challenges a limited number of regulations promulgated by the Department of Interior's Bureau of Land Management (BLM). The BLM regulations, rather than pertaining to state programs, address the federal regulation of federally owned land.

The challenged regulations herein address two major substantive areas: 1) the alluvial valley floor (AVF) exchange program; and 2) regulations governing unsuitability for mining on federal lands.

At a status call on January 15, 1980, the court set up a two-tiered briefing schedule as stipulated by the parties. The court heard oral argument concerning AVF exchanges on March 7, 1980. The parties presented, on April 25, 1980, their arguments pursuant to unsuitability determination.

I. AVF Exchange Program

The Surface Mining Control and Reclamation Act ("SMCRA") sets forth the statutory provisions pertaining to AVF's at § 510(b)(5). That section prohibits mining on an AVF if it will: 1) preclude farming or 2) materially damage water systems.

Section 510(b)(5) does grant some exceptions. It allows mining on an AVF if the AVF constitutes undeveloped range lands insignificant to farming, or, if the mining interferes with "such small acreage as to be of negligible impact on the farm's agricultural production." Section 510(b)(5) also provides for exemption through a grandfather clause. If, prior to enactment of the Act, the mine produced commercial quantities of coal, or, if a state regulatory authority had issued a permit for surfacecoal operations, then the operator is allowed to mine on the AVF.

Finally, Congress enacted an exchange program for companies who owned land with coal deposits, or who held leases to mine coal on federal land on AVF's. This exchange program, found after the proviso clause in § 510(b)(5), is the subject of the first round briefing.

Congress added the language, which created the exchange program, in two parts. As originally passed by the House, § 510(b)(5) failed to provide for any exchange program. 123 CONG. REC. H3826-37 (daily ed. 1977). The language of the Section, as it still reads, prohibited mining on an AVF, absent one of the exceptions, or qualification or the grandfather clause.

In the Senate debate, Senator Burdick evinced concern over the constitutionality of "taking"; whether prohibiting mining on AVF's for vested rights owners was constitutional. He suggested the possibility of an exchange of equal value. 123 CONG. REC. S8077-81 (daily ed. May 20, 1977).

Senator Wallop later that same day introduced his amendment. It called for a lease and fee exchange program, vesting the decision on effectuation of the exchange with the Secretary.1 Id. at S8147. The amendment passed, and became known as the Wallop Amendment.

Under the Amendment, the Secretary of Interior may exchange a lease to mine land on an AVF for another lease located on land suitable for mining. Similarly, if a coal operator owns land located on an AVF, the Secretary may exchange ownership of federal land for the privately owned deposits.The Secretary may approve such exchanges "if he determines that substantial financial and legal commitments were made by an operator prior to January 1, 1977. . . ."

The Conference Committee, however, went further. It added the second part of the exchange program, which now constitutes the last two sentences of § 510(b)(5). This language, resulting from an agreement in the Conference Committee, applies only to fee exchanges. It states:

It is the policy of Congress that the Secretary shall develop and carry out a coal exchange program to acquire private fee coal precluded from being mined by the restrictions of this paragraph (5) in exchange for Federal coal which is not so precluded. Such exchanges shall be made under section 206 of the Federal Land Policy Management Act of 1976.

The major issue that emerges from the first round briefs concerns whether the Secretary's decision, pursuant to private fee exchanges, is mandatory or discretionary. All parties agree that the Secretary enjoys discretion in deciding whether to effectuate a federal lease-by-lease exchange. But the plaintiffs argue that the fee coal exchange is mandatory. This means that if an operator owns land with deposits that happen to be located on an AVF, then the Secretary must exchange federally owned land for the privately owned area.

Although this question is far from clear, the court agrees with the plaintiffs; as best as can be discerned, Congressional intent appears to favor a mandatory fee exchange program.

First, the history of § 510(b)(5), explicated above, indicates an intent for mandatory fee exchange. The Wallop Amendment legislated a discretionary lease and fee exchange mechanism. But the Conferees were unsatisfied with the exchange program as it applied to fee ownership. They decided to strengthen the program. [11 ELR 20181] See 123 CONG. REC. H7583, 7591 (daily ed. July 21, 1977). Their unhappiness with a discretionary decision is incongruous with the Secretary's assertion that the Conferees merely added another discretionary process.

Second, the language of the Wallop Amendment, and the two sentences added by the Conferees, buttress this interpretation. The Wallop Amendment, which originally applied to both lease and fee exchanges, uses the word "may." It states that the Secretary "may . . . lease other Federal coal deposits . . . or convey to the fee holder . . . other available Federal coal deposits . . . ." Employment of the word "may," in a statute, indicates congressional intent for discretionary action. Udall v. Tallman, 380 U.S. 1 (1965), McDade v. Morton, 353 F. Supp. 1006 (D.D.C. 1973), aff'd per curiam, 494 F.2d 1156 (D.C. Cir. 1974).

The language used by the Conferees, applying only to fee exchanges, employs the mandatory word "shall." It states "that the Secretary shall develop and carry out a coal exchange program to acquire private fee coal . . . in exchange or federal coal . . . ." The use of the mandatory word "shall," as compared to the discretionary word "may," evinces the Conferees' intent to single out the fee exchange program for mandatory action.

Third, the legislative history amplifies that Congress intended mandatory fee exchanges. The Conference Report states:

The conferees also stipulated that the Secretary develop and carry out a coal exchange program for fee coal located in alluvial valley floors under the provisions of section 206 of the Federal Land Policy and Management Act of 1976.

The language added by the Conferees to the "Wallop Amendment" of the Senate version is designed to make it clear that the Secretary should actively implement the coal exchange program. This program would apply to all those private coal deposits, regardless of any previous financial or legal commitments, which the Secretary determines cannot be mined because of the provisions of Section 510(b)(5).

S. REP. NO. 95-337, 95th Cong., 1st Sess. 104-195 (1977).

The Secretary attempts to countervail this citation with his own reference from the same conference report. The report also states:

The Senate amendment also provided authority for the Secretary of the Interior to lease federal coal deposits as an exchange relinquishment of a federal coal lease for coal affected by this alluvial valley floor constraint. Such an "exchange" would be limited to those operators who had made a "substantial legal and financial commitment to mine such coal prior to January 1, 1977." Similar exchange authority under section 206 of the Federal Land Policy and Management Act of 1976 was granted the Secretary with respect to "fee" coal owned in alluvial valley floors. Both of these authorities were discretionary on the part of the Secretary.

Id. at 4.

These citations from the same report, though at first blush conflicting, serve to expose the congressional intent. The Secretary's citation explains the language of the original Wallop Amendment. As explicated above, and as explained in the Committee Report, the Wallop Amendment called for a discretionary decision with respect to both lease and fee exchanges. The plaintiff's citation, however, explains the congressional intent with respect to the language subsequently added by the Conferees. It expressly states that the fee exchange program "would apply to all those private coal deposits . . . which the Secretary determines cannot be mined because of the provisions of Section 510(b)(5)." This removes the Secretary's discretion whether to effectuate an exchange.

Given this background, the Secretary's argument, that § 206 of the Federal Land Policy and Management Act of 1976 (FLPMA) vests discretion on fee exchange decisions to the Secretary, is unpersuasive.2 The Secretary notes that the language added by the Conferees, as with language in the Wallop Amendment, requires that fee exchanges "shall be made under section 206" of the FLPMA. That section, 43 U.S.C. § 1716 (Supp. 1980), states that the Secretary of Interior "may" exchange tracts of federal land if he "determines that the public interest will be served by making that exchange." The Secretary therefore contends that the Wallop Amendment still reposes discretion, with the Secretary, to decide whether a fee exchange is in the public interest.

There is little question that the reference to the FLPMA creates some ambiguity. It appears strained, however, to interpret Congress' grant of mandatory exchanges as being negated in the very next sentence. This interpretation is buttressed by the fact that the FLPMA has the force of law, when implemented by subsequent legislation, only to the extent it does not conflict with the purposes of public land administration articulated in the subsequent statute. The FLPMA states:

The policies of this Act shall become effective only as specific statutory authority for their implementation is enacted by this Act or by subsequent legislation and shall then be construed as supplemental to and not in derogation of the purposes of which public lands are administered under other provisions of law.

43 U.S.C. § 1701(b).

One of the purposes of § 510(b)(5), as best as can be discerned, is to effectuate discretionary exchanges for leases and mandatory exchanges for private fee ownership. As explained, supra, the history of the congressional additions, the language of the Act, and the legislative history, although not unambiguous, evince an intent for mandatory fee exchange.

Other provisions of § 206, however, still maintain the force of law. For example, § 206(a) explicates several factors that the Secretary should be cognizant of in implementing a fee exchange. Although these factors cannot prevent the Secretary from effectuating an exchange, they would allow the Secretary the discretion to determine the geographic location of the exchange site. Moreover, § 206(b) dictates that the fee exchange should be for a site of equal value. Again, it is within the discretion of the Secretary to determine which site is of equal value to that located in the AVF.

Because the fee exchange program is mandatory, two regulations that implement a discretionary fee exchange must also be remanded. First, 43 C.F.R. § 3437.2(a), challenged by Texaco, states:

The Secretary shall evaluate each qualified exchange request and determine whether the exchange proponent is qualified and whether a request is appropriate and is in the public interest.

This regulation authorizes the Secretary to make a case-by-case determination of exchange eligibility. The court decided, supra, that fee interests must be exchanged. Accordingly, 43 C.F.R. § 3437.2(a), allowing discretionary fee exchanges, is remanded to the Secretary.

Second, the NCA objects to 43 C.F.R. § 3437.1-2(C). This regulation states that the Secretary "shall not consider an exchange program by the owner of coal" where the AVF prohibition "does not substantially decrease the value of, or prevent the successful mining of, other coal that would have been developed in conjunction with the coal in the alluvial valley floor." As stated by the NCA:

In other words, BLM intends to disqualify for an exchange a private owner of a coal deposit located in an alluvial valley floor, if the owner has surrounding deposits which can still be mined without substantial loss in value because of the alluvial valley floor prohibition.

January 25, 1980 Memorandum at 6. Since the fee exchange program is mandatory, the Secretary cannot engage in this type of [11 ELR 20182] speculation. The Secretary must award another, federal tract of land, of equal value to the coal that lies within the AVF, regardless of surrounding coal reserves that can be mined.

II. Unsuitability Determination

A. Background

The Secretary of Interior implements unsuitability determinations for federally-owned land. Section 522(b) of the SMCRA states:

The Secretary shall conduct a review of the Federal lands to determine . . . whether there are areas on Federal lands which are unsuitable for all or certain types of surface coal mining operations.

The Act empowers the Secretary to engage in two types of unsuitability determinations. First, § 522(a)(3) allows a discretionary determination of unsuitability for mining. Factors allowing a discretionary determination include historic lands, natural hazard lands, and land use programs. Second, § 522(e) requires a per se determination of unsuitability for lands that encompass, inter alia, the national forest boundaries, park system, and wildlife refuge system.

The BLM's regulations that implement the Act's command to engage in unsuitability determinations are found at 43 C.F.R. § 3461 (1979). The NCA generally argues thatthe unsuitability regulations place too many restrictions on the leasing of federal lands for coal removal. It presents five major arguments, which the court will address in turn.

B. Statutory Basis for Unsuitability Criteria

43 C.F.R. § 3461.1 lists 20 criteria for assessing whether land is unsuitable for mining. Some of these criteria find their statutory basis in statutes outside of the SMCRA. The NCA believes that the Secretary has failed to specifically articulate the statutory basis for each criterion.

The NCA does not object to the Secretary's employment of other federal statutes. Rather, it only attacks the specificity of the statutory basis. The NCA states:

NCA/AMC does not object to the Secretary's development of a comprehensive regulatory program that simultaneously implements several statutes . . . [But] the Secretary is still required to base each of his regulations on a specific statute.

March 3 Memorandum at 7.

The government notes that the preamble of 43 C.F.R. § 3461.1, see 44 Fed. Reg. 42603 (July 19, 1979), incorporates by reference a document termed the "Secretarial Issue Document." The government claims that this document grounds each criterion in "specific statutory authority." The Secretary also claims that his Draft Environmental Statement and Final Environmental Statement explicate the statutory authority for each unsuitability criterion.

Governmental agencies may supplement the Preamble of a regulation through incorporation of other documents. This Circuit Court of Appeals has stated that, in appropriate circumstances, "articulation of basis for administrative action can be discerned by reference to clearly relevant sources other than a formal statement of reasons . . . ." Environmental Defense Fund v. EPA, 465 F.2d 528, 537 [2 ELR 20228] (D.C. Cir. 1972).

The NCA nonetheless objects to the statutory basis articulated in the incorporated documents. It argues that: 1) the Secretary failed to contemporaneously publish the SID and the environmental statements; and 2) the incorporated documents lack specificity in their enlistment of statutory support for the unsuitability criteria.

As for contemporaneous publication, the NCA notes that the Secretarial Issue Document was published on June 1, 1979. This is two weeks after the comment period closed, and seven weeks prior to the date of publication of the preamble and the release of the regulations. The government published the Draft Environmental Statement on December 15, 1978, three months before it proposed the coal management regulations. The Final Environmental Statement was released on April 30, 1979, three weeks before the end of the comment period.

The court cannot agree with the NCA's assertion that incorporated materials must directly "accompany" the regulations. The release of the Draft Environmental Statement, before the opening of the comment period, afforded the NCA, and the public, an opportunity to comment on the statutory justifications. Moreover, the Final Environmental Statement and Secretarial Issue Document were published so close in time to the issuance of the regulations that, for all practical purposes, they qualify as accompanying the regulations' release.

The specificity enumerated in the incorporated documents is also sufficient. Although the Secretarial Issue Document, in some sections, lacks specificity of the statutory source, the Draft and Final Environmental Statements are extremely specific. See DES at 5-142 et seq.; FES at 3-43 et seq. The environmental statements each contain a detailed table, that enumerates, inter alia, the statutory source for each unsuitability criterion. The table lists more than one source for most of the criteria, and enumerates the specific section, of at least one statute, in almost all cases. Given the specificity of statutory grounding for the unsuitability criteria, the NCA challenge to the statutory basis must be rejected.

C. Exemption for Substantial Legal and Financial Commitments

Section 522(a)(3) of the SMCRA lists several types of land — including historic, renewable resource, and natural hazard — wherein the Secretary may find the land unsuitable for mining. Subsection (a)(6), however, exempts these lands from an unsuitability determination when an operator has expended substantial legal and financial commitments before the effective date of the Act, January 4, 1977. This exemption appears unequivocal; it applies, on its face, to all lands falling under § 522(a).

Five of the Secretary's unsuitability regulations, however, make no provision for an exemption based on substantial legal and financial commitments. 43 C.F.R. §§ 3461.1(i), (k), (l), (m), and (n). These regulations cover endangered plant, bird, and animal species. The NCA argues that the substantial commitment exemption of § 522(a)(3) is universal. It must apply to all lands considered for an unsuitability determination pursuant to § 522(a). The NCA therefore urges the court to remand the aforesaid regulations, with instructions to include the exemption for substantial commitments.

The Secretary maintains that the statutory support for the first four exceptions to the exemption stems not from the SMCRA but from the Endangered Species Act. See 16 U.S.C. §§ 1533(d) & 1536(a). He further maintains that § 3461.1(n), which prohibits mining on lands wherein bird species live in habitat, rests on the Migratory Bird Treaty Act. 16 U.S.C. § 703 et seq. These statutory sections empower the Secretary to issue regulations "to provide for the conservation of the species." The Secretary maintains that, given the Congressional mandate to protect endangered species and migratory birds, he "had no choice but to make these five criteria mandatory, with no exemptions allowed." April 3, 1980 Brief at 11.

The court finds that the Secretary cannot abrogate the clear statutory command of Congress: mining can ensue for those areas wherein substantial financial and legal commitments have been expended before the effective date of the Act.

It is clear that the Endangered Species Act empowers the Secretary to protect vanishing species of birds and wildlife. Likewise, the Migratory Bird Treaty Act prohibits the hunting or killing of certain birds listed in the statute. But neither Act empowers the Secretary to contravene an express, subsequent federal law. Herein, the provisions of the SMCRA, the most recent expression of Congressional policy, are clear: coal operators, who invested substantial financial and legal commitments before the effective date of the SMCRA, are exempt from its provisions.3

[11 ELR 20183]

D. Inconsistency of Regulations with Section 522

The NCA claims that four regulations are inconsistent with § 522 of the SMCRA. They are:

1. 43 C.F.R. § 3461.1(a). This regulation articulates the per se categories of unsuitability that the statute sets forth at § 522(e). These include, inter alia, lands within a national park, forest, or wildlife refuge. But the regulation also includes, within the per se category, lands recommended for, or under law required to be studied for, inclusion within the aforesaid land systems. The NCA objects to the regulation's expansion of the per se categories to include lands recommended or being studied for unsuitability designation.

The court will remand 43 C.F.R. § 3461.1(a). The court cannot uphold its extension of per se unsuitability categories. Congress spoke clearly as to the scope of the per se unsuitability applicability. Section 522(e)(1) protects lands that Congress has decided to preserve; not those lands that the Secretary has decided to study and recommend for preservation.

The Secretary's argument, that 43 C.F.R. § 3461.1(a) is necessary "for their [the lands'] protection until a final decision is made," brief at 16, may well be correct. It nonetheless conflicts with the Congresional intent articulated in the SMCRA. Moreover, although the Mineral Leasing Act of 1920, 30 U.S.C. § 181, may grant the Secretary broad powers for determining the availability of federal land for mineral development, this Act cannot supersede the clear, subsequent pronouncement of congressional intent articulated in 30 U.S.C. § 522(e)(1).

2. 43 C.F.R. § 3461.1(c). This regulation tracks the per se unsuitability standard of § 522(e)(4). That section prohibits mining within one hundred feet of a public road right-of-way. The statute includes three exceptions to this per se category. The regulation, however, lists only two. The NCA seeks inclusion of the third: where "the interests of the public and the landowners affected thereby will be protected."

The Secretary concedes this point. He states that "[t]he exception will be added when the Department conducts additional rulemaking on the Federal Coal Management Program this May." Brief at 12 at footnote.

3. 43 C.F.R. § 3461.1(p). Section 522(a)(3)(D) of the SMCRA allows the Secretary to declare as unsuitable for mining land where coal mining operations affect natural hazards so as to "substantially endanger life and property." This statute allegedly provides the statutory basis for 43 C.F.R. § 3461.1(p), which permits an unsuitability determination for land located in "riverine, coastal, and special floodplains." Such land is declared unsuitable unless mining will not threaten people or property.

The NCA believes the regulation lacks statutory support. Section 522(a)(3)(D) requires the Secretary to demonstrate a subtantial danger of life and property before obtaining an unsuitability ruling; the regulation, however, per se requires unsuitability unless lack of danger is proven.

The Secretary maintains that any shift in the burden is semantical. The court disagrees. There is a substantial difference between allowing a discretionary decision on unsuitability and per se requiring an unsuitability determination. The statute allows the former; the regulation implements the latter.

Nor does E.O. Order No. 11988 (May 24, 1977) authorize 43 C.F.R. § 3461.1(p). That Order does evince an interest in "flood hazards and flood plain management." It does not, however, direct a universal declaration of preservation for such lands, or a per se prohibition of mining thereon. Instead, it calls for a case-by-case determination. Becaue 43 C.F.R. § 3461.1(p) lacks authority in either statute or executive order, the court remands this regulation to the Secretary.

4. 43 C.F.R. § 3461.1(q). This section prohibits leasing of federal lands for mining when the land has been set aside for use as a municipal watershed. The regulation allows an exception for mining operations that will not adversely affect the watershed to a significant degree. But the regulation also requires the municipality or responsible governmental entity to concur in the granting of a lease pursuant to this exception. 43 C.F.R. § 3461.1(q)(2)(ii).

The NCA objects to the concurrence requirement. It claims that it amounts to a veto power that is unsanctioned by the Act. Section 522(a)(3)(C) permits the Secretary to determine land unsuitable for mining if the mining operations will adversely affect "the long range productivity of water supply." If water supply productivity is unaffected, the clear implication is that mining will be permitted. The regulation, however, adds the additional requirement of municipal government concurrence.

The Secretary cites § 522(a)(5) for support. This section states that unsuitability determinations should be "integrated as closely as possible" with the regulatory processes at federal, state, and local levels. Section 522(a)(5) does call for integration with local government. But the Secretary may establish regulations implementing such integration only to the extent allowed by the Act. Herein, the Act makes clear that if mining operations will not affect the productivity of the water supply, then mining may occur on federal land set aside as a municipal watershed. Local government veto power is not authorized by the Act; the Secretary cannot legislate through regulation what the Act does not allow.

The Secretary also cites § 2 of the Federal Leasing Amendments Act, 30 U.S.C. § 201(a)(2)(C). This statutory section commands the Secretary to consult with state and local governmental units in reaching coal leasing decisions. Consultation with state and local officials cannot be metamorphosized into veto power vested in their behalf. The court therefore remands 30 C.F.R. § 3461.1(q).

E. Application of Unsuitability Criteria From Other Acts to Leased Lands

The NCA objects to the Secretary's employment of other federal acts as statutory support for the application of unsuitability criteria to presently existing leased lands. 43 C.F.R. § 3461.4-2(a) empowers the Secretary to declare leased land unsuitable for mining. It states:

The unsuitability criteria shall be applied to all nonproducing leases, issued prior to the effective date of these regulations . . . . This shall not preclude assessment of lands in an existing lease as part of the normal land use planning process.

Hence, the Secretary may declare presently leased land, not yet producing coal, unsuitable for mining.

According to the NCA, unsuitability criteria based only on the Surface Mining Control and Reclamation Act may be applied to presently leased land. Many of the Secretary's criteria, however, are based on Acts other than the SMCRA.

For example, the Secretary bases several of his unsuitability criteria in the Federal Land Policy and Management Act of 1976, 43 U.S.C. §§ 1701-1782. The NCA alleges this Act allows the Secretary to develop land use planning for future, rather than presently existing, leases. Similarly, the Federal Coal Leasing Amendments Act of 1975, according to the NCA, is prospective in nature.

In sum, the NCA admits that the Secretary may apply unsuitability criteria, grounded in the SMCRA, to presently existing leases. He likewise possesses the authority to apply unsuitability criteria from other acts for future lease determinations. The Secretary, however, allegedly lacks authority to apply these criteria to presently extant leases.

This issue is not free from doubt. In balancing the arguments, the court concludes that Congress intended to apply, retrospectively, only those unsuitability criteria enumerated in the SMCRA.

The Secretary maintains, first, that other acts, from which he derives unsuitability criteria, authorize enforcement of these specifications to presently existing leases. But the Secretary can point to no authority, under either the Endangered Species Act, or the Migratory Bird Treaty Act, that empowers the application of unsuitability criteria to presently leased lands. Similarly, the Secretary can only assert that the Mineral Leasing Act of 1920 imposes "responsibilities upon the leases to protect the environment . . . ." Memorandum at 25.

The Secretary secondly asserts that § 702(b) of the Act authorizes enforcement of criteria from other Acts to presently leased lands. That section states that nothing in the SMCRA "shall affect in any way the authority of the Secretary . . . under other provisions of law to include in any lease . . . such conditions as may be appropriate to regulate surface coal mining . . . ."

[11 ELR 20184]

This citation fails to support the Secretary. It authorizes the inclusion of provisions, from other laws, in any lease regulating surface coal mining. It is nonetheless ambiguous whether the Secretary's authority to impose lease conditions applies to presently existing leases. Congress could have clearly empowered the Secretary to retrospectively enforce the provisions of other laws upon presently existing leases. It failed to do so.

Finally, the Secretary looks to the terms of the lease contracts. Lease contracts contain a clause that requires each lessee to follow reasonable regulations "now or hereafter in force." Read literally, this clause could support the Secretary. However, the court cannot interpret, as a "reasonable" regulation, that which undermines the entire value of the lease. While Congress unquestionably enjoys the power, absent an unconstitutional taking, to retrospectively enforce unsuitability criteria that derive their authority from other statutes, the Secretary can point to no authority in the SMCRA, or in any other statute, that empowers him to do. Absent a clear expression of Congressional intent, the court must enjoin the Secretary from enforcing these unsuitability criteria upon presently existing leases. We therefore remand 42 C.F.R. § 3461.4-2(a).

F. Prohibition of More Than One Unsuitablity Exception

43 C.F.R. § 3461.3-1, according to the NCA, requires that no more than one unusitability exception be applied to any particular lease site. If correct, the result is certainly arbitrary and capricious. For example, suppose two potential unsuitability criteria exist. Each criterion has a separate exception. One exception applies to negate the first unsuitability criterion. But even if another exemption applies to the second criterion, mining would be precluded because a potential lessee may assert only one unsuitability exception per site.

The Secretary's response appears to moot this issue. According to the Secretary, the regulation first requires that all applicable unsuitability criteria be examined to see how many apply. "Once the germane criteria are ascertained, then the exceptions and exemptions will be applied to determine if there are circumstances under which the area may still be considered suitable for mining." Brief at 21. This allows the agency to determine if any mandatory criteria — without any exceptions — apply. If one mandatory criterion applies, then there is no need to examine the exceptions to the discretionary unsuitability criteria.

The NCA agrees that the Secretary has defused this issue. It states in its reply brief:

To the extent the Secretary interprets the regulation in this manner and allows all available exceptions to apply to any unsuitability conditions present in an area of land, NCA/AMC withdraws its challenge.

Reply Memorandum at 16.

An appropriate Judgment accompanies this Memorandum.

1. Senator Wallop stated:

All it [the Wallop Amendment] does is go one step further from the very good protections of the alluvial valleys that we have now gotten completely entrenched in this bill. It takes care of the private interests of those people who do, in fact, have a property which they will never be able to develop under the terms of this bill.

This amendment will do nothing more than say to those who own that [coal] —

Your Government is not taking it from you without providing you something in return for what it is taking.

123 CONG. REC. S8147 (daily ed. May 20, 1977).

2. The Secretary also argues that the Conference Committee language only stated, that in evaluating fee exchanges, the Secretary need not consider financial and legal commitments. If this was the congressional intent, then Congress could have clearly stated so. Instead, Congress declared, not only that fee exchanges should be effectuated without regard to prior commitments, but also that the Secretary should actively implement the fee exchange program and apply it to all private coal deposits, located on an AVF, declared unsuitable for mining.

3. A subsequent federal acttakes precedence over previous expressions of federal policy. Herein, the SMCRA followed the passage of the Endangered Species Act. This was not the case in TVA v. Hill, 437 U.S. 153 [8 ELR 20513] (1978). Moreover, in TVA v. Hill, it was assumed that completion of the dam would have a devastating impact upon the population of the snail darter. The record herein is devoid of any showing that proper invocation of the substantial commitment exemption would significantly impede those species protected by the Endangered Species Act or the Migratory Bird Treaty Act.


11 ELR 20179 | Environmental Law Reporter | copyright © 1981 | All rights reserved