National Automotive Long Lines, Inc. v. Federal Communications Commission

No. 78-1246 (D.C. Cir. March 8, 1979)

The court of appeals upholds the Federal Communications Commission's (FCC's) denial of a request that an environmental impact statement (EIS) be prepared concerning an increase in the tariff for long lines communications facilities shared by automotive salvage yards. The defendant's regulations require any party requesting that an EIS be prepared for a given action to show that the proposed action will have a reasonable, proximate, predictable, and adverse effect on the physical environment. The court holds that the imposition of such a requirement is within the FCC's authority because it does not impose upon the requesting party an unreasonably severe burden of proof but merely requires a showing of credible facts that would prompt a reasonable mind to explore the issue further. Without deciding whether the action is one requiring preparation of an EIS, the court finds that the Commission took the requisite hard look at the concerns raised by the petitioners and affirms the denial of their request.

Counsel for Petitioner
Robert Grossman
Grossman & Flask
2020 K St. NW, Washington DC 20006
(202) 785-4100

Counsel for Respondent
Gregory M. Christopher
Office of the General Counsel
Federal Communications Commission, Washington DC 20554
(202) 632-7112

Andrea Limmer
Antitrust Division
Department of Justice, Washington DC 20530
(202) 633-4106

Counsel for Intervenor American Telephone & Telegraph Co.
Edgar Mayfield
Long Lines Department
American Telephone & Telegraph Co.
Room 3-C-123, Bedminister NJ 07921
(201) 234-6321

McKinnon, Robb, and Wilkey, JJ.

[9 ELR 20323]

Per curiam:

Memorandum

Petitioner, a nonprofit corporation comprised of persons and entities that lease private long line telecommunications facilities from AT&T which connect their automotive salvage yards, seeks review of the Federal Communications Commission's refusal to prepare an environmental impact statement prior to accepting a revised tariff from AT&T. The revised tariff, occasioned by the Commission's determination that the rates paid under the earlier tariff were discriminatory and hence unlawful, would significantly raise the cost of the private lines for petitioner.

Petitioner argued that this price increase would impede the flow of recycled scrap metal to the detriment of the environment, and that therefore the Commission had a "clear, non-discretionary, ministerial duty" under the National Environment Policy Act, 42 U.S.C. § 4321 et seq., to compile an environmental impact statement before permitting the price increase to go into effect. In an order adopted January 19, 1978, the Commission denied petitioner's request with the observation that the tariff revision "will not have a 'discernible impact on the physical environment.'" American Telephone & Telegraph Co., 67 F.C.C.2d 522, 525 (1978) (quoting Implementation of the National Environmental Policy Act of 1969, 49 F.C.C.2d 1313, 1317 (1974), reconsideration granted in part, 56 F.C.C.2d 635 (1976).

In seeking review, petitioner claims that the Commission (1) improperly placed upon it the burden of demonstrating the need for an environmental impact statement, (2) unlawfully declined its request to prepare a statement, and (3) inadequately explained the reasons for doing so. We hold that these claims are without merit and accordingly we deny the petition.

[9 ELR 20324]

The National Environmental Policy Act does not require any agency to prepare an environmental impact statement merely upon the demand of a private party. Rather, the statute compels preparation of a statement whenever an administrative agency recommends or reports on "proposals for legislation and other major Federal actions significantly affecting the quality of the human environment." 42 U.S.C. § 4332.

The statute also created the Council on Environmental Quality, id. § 4342, which has the responsibility to review and appraise agency compliance with the statute, id. § 4344(3). Acting pursuant to this authority, the Council promulgated regulations directing each administrative agency to establish formal procedures and rules to identify those agency actions that must be preceded by preparation of an environmental impact statement. 40 C.F.R. 1500.3 et seq. (1978); see 42 U.S.C. § 4332(2)(B).

In response to this directive, the Commission adopted regulations defining what it believes are "major Federal actions" and providing that the Commission "on its own motion or on motion of any interested party, may determine . . . the environmental consequences of a particular action." 47 C.F.R. § 1.305(c) (1978). A party making such a motion must show that the proposed action "will have a reasonable proximate, predictable, and adverse effect on the physical environment." American Telephone & Telegraph Co., 58 F.C.C.2d 899, 901 (1976), Implementation of the National Environmental Policy Act, supra, 49 F.C.C.2d at 1318.

As we read this requirement, it does not obligate a party advocatingpreparation of a statement to carry a substantive burden of proof whereby, for example, the party must show by a preponderance of the evidence that a statement is required. Instead, we read it to require a party to allege creditable facts that would prompt a reasonable mind to explore further into the possible implications of the agency's action. Imposition of such a requirement is clearly within the agency's authority. Cf. Vermont Yankee Nuclear Power Co. v. Natural Resources Defense Council, 435 U.S. 519, 554 [8 ELR 20288] (1978).

Nothing in this memorandum should be interpreted as a wholesale endorsement of the Commission's threshold requirements. Moreover, we expressly note that the Commission did not reach the question whether its acceptance of a tariff was a "major Federal action" requiring, in the event of probable environmental effect, the preparation of an impact statement. Consequently, that issue is not before us. We simply hold that the Commission did not improperly impose a burden of proof on the petitioner.

We think the Commission fulfilled its obligations under the National Environmental Policy Act and the regulations issued under the statute. Petitioner's only complaint is that persons and entities leasing private long lines will no longer enjoy the unlawful advantage of a discriminatory rate. Evidence before the Commission indicated that the costs of the private lines under either the old or the revised tariff were infinitesimal when compared with the annual gross income the salvage industry derives from recycling alone. There are no facts in the record intimating that the price increase cannot be passed along or otherwise absorbed as a cost of engaging in the salvage industry. Nor was the Commission required to anticipate environmental effects when no necessary connection exists betwen a neutral price increase and the ability of salvage yards to recycle or resell automotive parts.

The National Environmental Policy Act is an expression of Congress' desire to inject environmental concerns into administrative decision making. It was not designed as a tool simply to forestall adverse administrative action or to require the expenditure of limited agency resources on a remote and speculative claim of environmental injury. See National Citizens Committee for Broadcasting v. FCC, 567 F.2d 1095, 1098 n.3 (D.C. Cir. 1977), cert. denied, 436 U.S. 926 (1978).

Finally, we think the Commission took the requisite "hard look" at the concerns raised in petitioner's motion. See Natural Resources Defense Council, Inc. v. Morton, 458 F.2d 827, 838 [2 ELR 20029] (D.C. Cir. 1972). The Commission's order denying petitioner's request, while succinct, sufficiently illuminates the path of reasoning followed by the Commission to provide this court with a reviewable record that reveals the agency's consideration of the relevant factors. Cf. Betco Petroleum Corp. v. Federal Energy Regulatory Commission. No. 77-1416, slip. op. at 11 n.6 (D.C. Cir. Nov. 15, 1978).