High Court Pens Sweeping Endorsement of Surface Mining Law

In 1977, after seven years of intense debate, Congress passed the Surface Mining Control and Reclamation Act (SMCRA),¹ one of the most far-reaching federal land-use laws. The Act was intended to alleviate widespread environmental abuses caused by surface coal mining operations by imposing stringent uniform federal standards on mining operations. Enforcement of the standards rests with participating states through federally approved state programs, or with the federal government in lieu of states that do not want to assume that responsibility.

This controversial regulatory scheme was immediately besieged with constitutional challenges in several federal district courts, which produced sharply inconsistent decisions.² Courts in Tennessee and Iowa rejected challenges based on the Fifth and Tenth Amendments and the Commerce Clause.³ However, in two other cases, Virginia Surface Mining and Reclamation Association v. Andrus⁴ and Indiana v. Andrus,⁵ district courts in Virginia and Indiana declared that certain portions of the Act violate the Constitution and permanently enjoined their enforcement. In separate opinions handed down last month, the Supreme Court reversed the lower courts and unanimously upheld the constitutionality of the Act. In Hodel v. Virginia Surface Mining and Reclamation Association,⁶ the Court held that the "steep slope" reclamation standards mandated by the Act do not violate the Commerce Clause, the Tenth Amendment, or the Just Compensation and Due Process Clauses of the Fifth Amendment. Focusing on the six "prime farmland" provisions and 15 other provisions of the Act, the Court also held, in Hodel v. Indiana,⁷ that those provisions do not violate the Commerce Clause or the Fifth and Tenth Amendments.The two decisions are a blow to the industry, which had hoped that it would obtain some relief from the Act's stringent and comprehensive limitations on surface mining. More broadly, the opinions appear to represent a broad endorsement of the power of Congress to impose various environmental controls of the states and private entities.

The Surface Mining Control and Reclamation Act

In the SMCRA, Congress recognized that surface mining operations adversely affect commerce and the public welfare by causing a variety of environmental problems, such as erosion, flooding, water pollution, and destruction of fish and wildlife habitats. In addition, it found that mining and reclamation standards are essential to "insure that competition in interstate commerce among sellers of coal produced in different States will not be used to undermine the ability of the several States to improve and maintain adequate standards on coal mining operations within their borders."⁸ The Act establishes a "nationwide program to protect society and the environment from the adverse effects of surface coal mining operations."⁹

Title II¹⁰ created the Office of Surface Mining Reclamation and Enforcement (OSM) within the Department of the Interior and assigned it primary responsibility for administering the Act, promulgating regulations, and enforcing them. Initially, OSM was required to establish interim regulations setting immediately effective mining and reclamation standards.¹¹ Within one year of the date of enactment, the Secretary was required to promulgate a permanent regulatory program.¹² States wising to assume regulatory control over surface coal mining operations were required to submit a state program for approval by OSM.¹³ Once approved, the states assume primary enforcement responsibility.For any state that lacks an approved program, the Secretary must implement a federal program of regulation and enforcement.¹⁴ In addition, if [11 ELR 10137] a state fails to properly enforce its state program, OSM must enforce the Act.¹⁵

Title V contains the principal regulatory and enforcement provisions governing the permanent regulatory program. Section 515(b)¹⁶ sets out general performance standards applicable to all surface coal mining and reclamation operations. Among other things, it requires operators at a minimum to restore the land to its approximate original contour,¹⁷ restore the land to its prior condition,¹⁸ and restore the topsoil of all prime farmlands.¹⁹ Section 515(d) contains specific performance standards for mining on steep slopes which may be eased by variances allowed under § 515(e).²⁰ The Act also bans surface coal mining near schools, highways, cemeteries, and buildings²¹ and provides a process to designate lands as unsuitable for surface coal mining.²²

Although upon OSM approval of a state program implementation and enforcement of the Act is transferred to the state, OSM has a right to enter any mining operation. In addition, the regulatory authority must conduct monthly and quarterly inspections, without prior notice, of all permitted coal mining operations.²³ Violators of either the Act or its implementing regulations are subject to civil and criminal penalties.²⁴ OSM may also order a complete cessation of mining when there is a need for emergency action.²⁵ In toto, the Act places severe restrictions on surface coal mine operations, which may sharply increase the cost of production in certain areas of the country and make surface mining, at least on steep slopes, economically infeasible if not physically impossible.

The Virginia Decision

In Hodel v. Virginia Surface Mining and Reclamation Association,²⁶ an association of coal producers operating surface mines in Virginia had presented the district court with challenges to the constitutionality of the SMCRA, primarily its Title V performance standards. The district court rejected plaintiffs' Commerce Clause, equal protection and substantive due process challenges, but found that certain provisions of the Act violated the Tenth Amendment and the Just Compensation and Due Process Clauses of the Fifth Amendment.²⁷ The court permanently enjoined the Secretary of the Interior from enforcing these provisions.

In the first of two decisions on the Act, the Supreme Court, with Justice Marshall writing for a unanimous court, reversed the Virginia district court decisions and upheld the constitutionality of the SMCRA. Rejecting appellees' Commerce Clause challenges, Justice Marshall emphasized that, in reviewing legislation enacted under the Commerce Clause, the Court must defer to a congressional finding that the regulated activity affects interstate commerce as long as there is a rational basis for such a finding and it appears that the particular regulatory scheme reasonably furthers legitimate regulatory goals. In addition, since the Commerce Clause grants plenary authority to Congress, purely intrastate activities may be regulated if they exert a substantial effect on interstate commerce when combined with other such activities. In the SMCRA Congress expressly found, after thorough consideration, that surface coal mining activities would have adverse effects on the nation's environment and economy. Indeed, Justice Marshall quoted a number of statements in the legislative history citing the range of air quality effects, water pollution, and other environmental ills that are caused by strip mining.²⁸ Justice Marshall also noted that nationwide standards are essential to protect states that choose to regulate surface mining from unfair interstate competition from states which choose to adopt less restrictive standards in order to encourage industrial development, adding that the prevention of destructive interstate competition is traditionally within the reach of Congress' Commerce Clause power. This power is also broad enough to permit regulation of activities causing air and water pollution and other adverse environmental effects. Thus, he concluded, Congress rationally determined that regulation of surface mining is necessary to protect interstate commerce.

Under the Tenth Amendment, as construed in the Supreme Court's decision in National League of Cities v. Usery,²⁹ the district court had invalidiated the § 515 performance standards for surface coal mining on "steep slopes,"³⁰ concluding that they violate the Tenth Amendment by interfering with the states' "traditional governmental [11 ELR 10138] function" of regulating land use. Justice Marshall, however, in upholding the steep-slope provisions, drew a sharp distinction between "congressional regulation of private persons and business" and "federal regulation 'directed not to private citizens, but to the States as States.'"³¹ Only the latter, he emphasized, violates the Tenth Amendment's dictates. The steep-slope provisions of the Surface Mining Act do not violate the Tenth Amendment because they govern only the activities of private coal mine operators. Moreover, states are not compelled to enforce the standards or to expend state funds since the Act leaves the states free not to participate in the federal regulatory program. Therefore, Justice Marshall wrote, "there can be no suggestion that the Act commandeers the legislative process."³² Analogous programs, he observed, have been established under other federal environmental statutes and have been found to present no Tenth Amendment problems. The Court also rejected, based on long-established precedent,³³ appellees' contention that the Act, by establishing minimum federal standards, improperly preempts the states' freedom to make decisions areas of "integral governmental functions."³⁴ As with the Supremacy Clause, which allows Congress to go so far as to prohibit all state regulation of activities affecting interstate commerce, the Tenth Amendment presents no barrier to preemptive federal regulation of private activity, so long as the means chosen are reasonable.

Considering next appellees' takings challenge to the Act, Justice Marshall explained that since no party to the case had identified any specific tract of land which had allegedly been rendered valueless, it was impossible for the Court to undertake the kind of careful analysis necessary for "takings" decisions. The Court was thus confined to the issue of whether the "mere enactment" of the Act constitutes a taking and found that it does not, on its face, violate the Fifth Amendment. It does not prohibit all beneficial uses of coal-bearing lands but "merely regulates the conditions under which such operations may be conducted."³⁵

Finally, the Court rejected a number of due process challenges to the Act. The district court had invalidated § 521, which authorizes the Secretary to issue summary cessation orders, followed by an administrative hearing, if requested, where a mining operation may create an immediate public health or environmental hazard. Justice Marshall pointed out that while due process ordinarily requires an opportunity for a hearing prior to the deprivation of a property interest, summary administrative action may be justified in emergency situations. In the opinion of the Court, the public health and environmental risks which can result from strip mining, as emphasized in the Act's legislative history,³⁶ fall squarely in the category of emergency situations justifying the use of summary administrative procedures. Furthermore, the criteria established in the Act governing the issuance of summary cessation orders are, contrary to the view of the district court, specific enough to satisfy the minimal due process requirements which remain applicable in emergencies. The Court, finally, rejected appellees' due process challenges to the Act's civil penalty provisions as premature. Since appellees did not allege that civil penalties had actually been assessed, there was no concrete case or controversy for the Court to consider.

Chief Justice Burger and Justices Powell and Rehnquist concurred separately. Justice Powell agreed with the Court that the takings challenge was premature but suggested that the steep-slope provisions, when applied to certain rugged areas, such as those in West Virginia, may amount to a taking because the cost of restoration often exceeds the value of the coal.

Justice Rehnquist's concurring opinion focused on the Commerce Clause issue, specifically the Court's readiness to defer to the congressional judgment that strip mining affects interstate commerce. Though acknowledging that Congress' power to regulate interstate commerce is quite broad, he stressed that it is not unlimited. Supreme Court precedent has established that there must be a showing that an activity has a substantial effect on interstate commerce before it may be regulated under the Commerce Clause. The Court's majority opinion, although it does mention that Congress found such a substantial effect, did not clearly require this showing in Justice Rehnquist's view. Chief Justice Burger shared this concern over the case-by-case expansion of the reach of the Commerce Clause, but he concurred with the Court because its opinion "acknowledges and reaffirms" the substantial effect doctrine.

The Indiana Decision

In Hodel v. Indiana³⁷ the state and a group of coal producers had attacked the constitutionality of six "prime farmland" provisions and 15 other general provisions of the Act.³⁸ The district court sustained plaintiffs' Commerce Clause, equal protection, due process, takings, and Tenth Amendment challenges and permanently enjoined the Secretary from enforcing the challenged sections. Again, with Justice Marshall writing for a unanimous court, the Supreme Court reversed the district court and upheld the constitutionality of the Act.

With respect to the prime farmland provisions, the district court had ruled that since only a small percentage of the total prime farmland acreage in the country had been or was likely to be disturbed by surface coal mining, such mining had no substantial effect on interstate commerce. Reasoning further that air and water pollution was the only possible adverse effect on interstate commerce due to mining, the district court concluded that the challenged provisions "are not directed at the alleviation of [11 ELR 10139] water and air pollution," since these effects were adequately addressed by other sections of the Act and by other federal statutes.³⁹ Thus, regulation of surface coal mining on prime farmland is beyond congressional power under the Commerce Clause.

Rejecting the district court's conclusion, the Supreme Court found that the court had incorrectly considered the volume of commerce actually affected by the regulated activity: "The pertinent inquiry is not how much commerce is involved but whether Congress could rationally conclude that the regulated activity affects interstate commerce."⁴⁰ Applying this "rational basis" test, Justice Marshall pointed out that congressional committee reports indicate that Congress had ample support for its finding that surface coal mining on prime farmland affects interstate commerce in agricultural products. The trial court had also incorrectly assumed that the goals of the Act are limited to preventing air and water pollution. The challenged provisions, the High Court determined, were reasonably adopted to preserve the productive capacity of mined land, to protect the environment, and to protect the health and safety of the public, in order to prevent adverse effects on interstate commerce.

As in Virginia Surface Mining, Justice Marshall rejected appellees' Tenth Amendment and takings challenges in reversing the district court. He reaffirmed that the Act regulates only the activities of private surface mine operators, not the "States as States," and thus does not violate the Tenth Amendment. Nor does the Act, on its face, violate the Just Compensation Clause.The six prime farmland provisions challenged on takings grounds neither prohibit surface mining nor deter non-mining land uses; they merely regulate the conditions under which specific mining activities may be conducted.

Unlike the complainants in Virginia Surface Mining, the appellees in Indiana raised an equal protection challenge to the Act, asserting that the Act's failure to authorize variances from the prime farmland and approximate original contour requirements work an unconstitutional discrimination against coal mine operators and states in the Midwest where significant coal deposits lie under relatively flat farmlands and there are few steep-slope operations. The Court was unsympathetic. Since the Act does not employ "suspect classifications" or impinge on "fundamental rights," it must be upheld when the "legislative means are rationally related to a legitimate governmental purpose." This test has already been resolved in the Act's favor in Virginia Surface Mining, and the Court's conclusion was in no way undercut by the statute's failure to produce uniform geographic impacts.

Discussion

The Supreme Court's decisions in Virginia Surface Mining and Indiana are considered a stirring and muchneeded victory by those concerned about the adverse environmental effects of surface coal mining. It is difficult to conceive how a more resounding approval of the statute could have been fashioned. However, the opinions do leave open the opportunity for future litigation. Although the Act was found, on its face, not to violate the Just Compensation Clause of the Fifth Amendment, Justice Powell's concurrence is a remainder that in specific ceases certain provisions may be vulnerable to takings challenges. However, due process arguments are unlikely to meet with much success because of the Court's approval of the administrative review procedures supplied in the Act, and challenges based on the Tenth Amendment, the equal protection guarantee of the Fifth Amendment, and the Supremacy Clause seem pre-ordained to failure.

The Court's sweeping approval of the SMCRA has implications for other environmental statutes as well. The opinions establish a strong precedent for rejecting Tenth Amendment challenges to other statutes which allow for state regulations based on federal standards, such as the Clean Air Act and the Federal Water Pollution Control Act. Although these laws have previously withstood such attacks, the Toxic Substances Control Act,⁴¹ the Resource Conservation and Recovery Act,⁴² the Federal Land Policy and Management Act,⁴³ and the Comprehensive Environmental Response, Compensation, and Liability Act⁴⁴ now seem clothed with a presumption of constitutionality. And in the context of litigation over environmental laws which Congress may enact in the future, the strip mining decisions appear to render frivolous any claim that Congress cannot regulate, under the Commerce Clause, activities having significant adverse environmental impacts.

In light of the Reagan Administration's emphasis on budget-cutting and reducing federal regulation, the near-term impact of the decisions may be limited. Interior Secretary Watt has proposed a major reorganization of the Office of Surface Mining, including major staff reductions, which may severely limit the role of the federal government in overseeing the enforcement of the Act by the states.⁴⁵ The Act was passed, in large, part, because of the failure of the states to properly regulate surface mining operations which resulted in sometimes severe health and safety and environmental hazards.⁴⁶ Without strong federal oversight of state programs, the Supreme Court's overwhelming approval of Congress' mandate to regulate surface mining may be overshadowed by the Administration's decision not to exercise the full complement of its statutory powers.

1. 30 U.S.C. §§ 1201-1328, ELR STAT. & REG. 42401.

2. See generally Comment, Western Coal Fields Declared Unsuitable for Mining Amidst Legal Challenges to § 522 of Surface Mining Act, 11 ELR 10048 (Feb. 1981); Comment, The 1977 Surface Mining Act Revisited: National Regulatory Program Surmounts Judicial and Legislative Challenges, 9 ELR 10199 (1979).

3. See Concerned Citizens of Appalachia, Inc. v. Andrus, __ F. Supp. __, 10 ELR 20536 (E.D. Tenn. June 12, 1980); Star Coal Co. v. Andrus, __ F. Supp. __, 10 ELR 20328 (S.D. Iowa Feb. 13, 1980).

4. __ F. Supp. __, 10 ELR 20128 (W.D. Va. Jan. 3 & 21, 1980).

5. __ F. Supp. __, 10 ELR 20613 (S.D. Ind. June 10, 1980).

6. 49 U.S.L.W. 4654, 11 ELR 20569 (June 15, 1981), rev'g sub nom. Virginia Surface Mining & Reclamation Ass'n v. Andrus, __ F. Supp. __, 10 ELR 20128 (W.D. Va. June 10, 1980).

7. 49 U.S.L.W. 4667, 11 ELR 20581 (June 15, 1981), rev'g sub nom. Indiana v. Andrus, __ F. Supp. __, 10 ELR 20613 (S.D. Ind. June 10, 1980).

8. 30 U.S.C. § 1201, ELR STAT. & REG. 42402.

9. 30 U.S.C. § 1202, ELR STAT. & REG. 42402.

10. 30 U.S.C. § 1211, ELR STAT. & REG. 42403. The Secretary of the Interior, acting through OSM, is nominally responsible for administering the Act.

11. 30 U.S.C. §§ 1251 and 1252(e), ELR STAT. & REG. 42410. Section 502, 30 U.S.C. § 1252, ELR STAT. & REG. 42410, lists those provisions of the Act which must be complied with during the interim period. Promulgation of the interim regulations elicited a number of court challenges. See generally sources cited at note 2, supra.

12. 30 U.S.C. § 1251, ELR STAT. & REG. 42410.

13. 30 U.S.C. § 1253, ELR STAT. & REG. 42410. As of April 30, 1981, of 21 state programs submitted to OSM for approval, three have been approved, 15 have been partially or conditionally approved, and three have been disapproved. 46 Fed. Reg. 24465 (Apr. 30, 1981). OSM has proposed deadline extensions to correct minor deficiencies in several conditionally approved programs. 46 Fed. Reg. 33056 (June 26, 1981). It has also proposed to amend the "state window" rule to allow states to adopt their own regulations meeting the Act's requirements instead of parrotting the federal regulations, in order to meet local needs and allow for regulatory flexibility. 46 Fed. Reg. 34348 (July 1, 1981).

14. 30 U.S.C. § 1254, ELR STAT. & REG. 42411.

15. 30 U.S.C. § 1271(b), ELR STAT. & REG. 42422.

16. 30 U.S.C. § 1265(b), ELR STAT. & REG. 42416.

17. 30 U.S.C. § 1265(b)(3), ELR STAT. & REG. 42416.

18. 30 U.S.C. § 1265(b)(2), ELR STAT. & REG. 42416. This section requires the operator to restore the land affected to a condition capable of supporting the uses which it was capable of supporting prior to any mining, or to a higher or better use.

19. 30 U.S.C. § 1265(b)(6), ELR STAT. & REG. 42416.

20. 30 U.S.C. § 1265(d) & (e), ELR STAT. & REG. 42418.

21. 30 U.S.C. § 1272(e), ELR STAT. & REG. 42423. An Ohio district court recently upheld the constitutionality of § 522(e)(5), which prevents mining within 100 feet of a cemetery, Holmes Limestone Co. v. Andrus, __ F. Supp. __, 11 ELR 20166 (N.D. Ohio Oct. 7, 1980).

22. 30 U.S.C. § 1272, ELR STAT. & REG. 42422. For a discussion of the application of this provision, see Comment, Western Coal Fields Declared Unsuitable for Mining Amidst Legal Challenges to § 522 of Surface Mining Act, 11 ELR 10048 (Feb. 1981).

23. 30 U.S.C. § 1267, ELR STAT. & REG. 42419.Under this section partial inspections by the regulatory authority must occur at least once per month, and a complete inspection must occur each quarter for each mining operation covered by a permit. Section 515(c), 30 U.S.C. § 1265(c), ELR STAT. & REG. 42418, sets out permitting requirements.

24. 30 U.S.C. § 1268, ELR STAT. & REG. 42420.

25. 30 U.S.C. § 1271(a)(2), ELR STAT. & REG. 42421. Cessation orders may be issued when the Secretary's authorized agent determines that a mining condition or permit violation creates an imminent danger to the health or safety of the public, or is causing, or can reasonably be expected to cause significant, imminent environmental harm to land, air, or water resources.

26. 40 U.S.L.W. 4654, 11 ELR 20569 (June 15, 1981), rev'g sub nom. Virginia Surface Mining & Reclamation Ass'n v. Andrus, __ F. Supp. __, 10 ELR 20128 (W.D. va. June 10, 1980).

27. The district court invalidated § 515(d) and (e) of the Act, which prescribe performance standards for surface coal mining on "steep slopes," and § 522, governing unsuitability designations. 30 U.S.C. §§ 1265(d) & (e), 1272, ELR STAT. & REG. 42418, 42422.

28. See 49 U.S.L.W. at 4657-59, 11 ELR at 20572-73.

29. 426 U.S. 833 (1976).

30. 30 U.S.C. § 1265(d) & (e), ELR STAT. & REG. 42418.

31. 49 U.S.L.W. at 4659, 11 ELR at 20574.

32. 49 U.S.L.W. at 4660, 11 ELR at 20575.

33. See 49 U.S.L.W. at 4660, 11 ELR at 20575.

34. 49 U.S.L.W. at 4660, 11 ELR at 20575.

35. 49 U.S.L.W. at 4662, 11 ELR at 20577.

36. See note 28, infra. The court noted, in Hodel v. Virginia Surface Mining & Reclamation Ass'n, the Buffalo Creek flood caused by the sudden collapse of a coal mine waste impoundment in 1972 near Buffalo Creek, West Virginia, which left 124 persons dead and 4,000 homeless. 49 U.S.L.W. at 4663 n.44, 11 ELR at 20578 n.44.

37. 49 U.S.L.W. 4667, 11 ELR 20581 (June 15, 1981), rev'g sub nom. Indiana v. Andrus, __ F. Supp. __, 10 ELR 20613 (S.D. Ind. June 10, 1980).

38. See 49 U.S.L.W. at 4668-69, nn.6 & 9, 11 ELR at 20582-83 nn.6 & 9, listing the 21 provisions challenged by appellees.

39. __ F. Supp. at __, 10 ELR at 20616.

40. 49 U.S.L.W.at 4669, 11 ELR at 20583.

41. 15 U.S.C. §§ 2601-2629, ELR STAT. & REG. 41335.

42. 42 U.S.C. §§ 6901-6987, ELR STAT. & REG. 41901.

43. 43 U.S.C. §§ 1701-1782, ELR STAT. & REG. 41458.

44. 42 U.S.C. §§ 9601-9657, ELR STAT. & REG. 41941.

45. On May 21, 1981, Secretary Watt announced the Department of the Interior's plan to eliminate 400 OSM staff positions of the existing 1,001, to reduce the inspection and enforcement division by 57 percent, and to abolish five OSM regional offices to be replaced with two technical centers and 14 state offices for 31 coal-producing states. See 6 PUB. LAND NEWS 7 (MAY 21, 1981).

46. See H.R. REP. NO. 218, 95th Cong., 1st Sess. 58 reprinted in [1977] U.S. CODE & AD. NEWS 596.