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Mt. Airy Ref. Co. v. Schlesinger

Citation: 10 ELR 20267
No. No. CA-79-1366, 481 F. Supp. 257/13 ERC 1641/(D.D.C., 08/21/1979)

The district court remands, for violations of the Department of Energy Organization Act and the National Environmental Policy Act (NEPA), regulations issued by the Department of Energy (DOE) amending the domestic crude oil allocation plan so as to adjust the economic benefits given small refiners pursuant to the "entitlements program," also known as the "small refiner bias." In its notice of proposed rule making to adjust the small refiner bias, 43 Fed. Reg. 54652 (Nov. 22, 1978), DOE disclosed only its intent to reduce the benefits paid to small refiners. The agency's failure to provide notice of its intent to phase out the program altogether violates the procedural requirements of the DOE Organization Act, 42 U.S.C. § 7191(b)(1), and requires that the regulations be repromulgated. The court upholds the regulations, however, against claims that they are (1) not supported by the administrative record because DOE gave inappropriate weight to much of the evidence contained therein and (2) invalid because they were not submitted for review to both houses of Congress as allegedly required under the Energy Policy and Conservation Act.

Finally, the court determines that the regulations were issued in violation of NEPA. To the extent that the final regulations were expressly proposed in the notice of proposed rule making, DOE properly concluded that the action would not have significant environmental effects and thus would not require preparation of an environmental impact statement (EIS). However, that negative determination was based solely on the foreseen impacts of the regulations that were proposed and did not refer to the impacts of phasing out the small refiner bias entirely, an action which was not revealed until the regulations were finalized. After evaluating plaintiffs' claims of irreparable injury, the balance of harms, and the public interest, the court enjoins implementation and remands those parts of the final regulations that were neither properly noticed in the notice of proposed rule making nor subjected to environmental analysis under NEPA. The remainder of the final regulations, however, are left in effect. That portion of the court's opinion dealing with NEPA and the formulation of relief are reprinted below.

Counsel for Plaintiffs
Barry J. Cutler, David R. Melincoff
O'Connor & Hannan
1747 Pennsylvania Ave. NW, Washington DC 20006
(202) 785-8700

Counsel for Defendants
Barbara L. Gordon, Paul Blandenstein
Civil Division
Department of Justice, Washington DC 20530
(202) 633-4776

Robert W. Batchelder
Urban Mass Transportation Administration
Department of Transportation, Washington DC 20590
(202) 426-4043

Counsel for Amicus Curiae American Coalition of Citizens with Disabilities
James J. Raggio
Public Interest Law Center of Philadelphia
1315 Walnut St., Philadelphia PA 19107
(215) 735-7200

Counsel for Amicus Curiae American Ass'n of State Highway and Transp. Officials
Charles A. Miller, Carolyn F. Corwin
Covington & Burling
888 16th St. NW, Washington DC 20006
(202) 452-6000