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December 19, 1980

Clifford L. ALEXANDER, Jr. et al., Defendants

The opinion of the court was delivered by: SMITH


Plaintiffs, three power companies, bring this action against the United States Army Corps of Engineers (the Corps) and various individuals acting in their official capacities. They seek injunctive and declaratory relief regarding the Corps' denial of their application for a permit for the Davis Pumped Storage Hydroelectric Project (the Project), a complex of dams designed to produce power. Prior to the Corps' denial, a license to construct and operate the Project had been issued by the Federal Power Commission (FPC), the predecessor of the Federal Energy Regulatory Commission (FERC). *fn1" Plaintiffs contend that the Corps is without jurisdiction to either grant or deny a permit for the Project, that the Corps is barred by principles of res judicata and collateral estoppel from denying a permit to a project already licensed by FPC, and that the hearing procedure conducted by the Corps violated their Due Process rights. The State of West Virginia and six conservation organizations were granted leave to intervene to brief the Court on state-related and environmental issues. Jurisdiction is properly founded upon 28 U.S.C. § 1331 (1976) and 5 U.S.C. §§ 701-03 (1976). The matter is before the Court on plaintiffs' joint motion and defendants' cross motion for summary judgment.

 Prior to the enactment of the Water Power Act, federal control over water power was characterized by duplicative and overlapping regulatory jurisdiction. Authority to license water power projects was shared among three agencies: the Department of Interior, the Department of Agriculture, and the Secretary of War. J. Kerwin, Federal Water Power Legislation 107 (1926). The Water Power Act was intended to coordinate the exercise of federal jurisdiction, H.R.Rep.No.61, 66th Cong., 1st Sess. 5 (1919); and to that end the Act created the FPC with authority over federal water power projects. See 41 Stat. 1063 (1920).

 At the time of its passage, the Water Power Act was administratively interpreted as concentrating all licensing authority in the FPC and providing "a complete and detailed scheme for the development ... of all the water power resources of the public domain." 32 Op. Att'y Gen. 525, 528 (1921). The FPC's general counsel concluded that "it was the purpose of Congress to confer exclusive jurisdiction on the Federal Power Commission ... over the matter of issuing licenses" for hydroelectric power projects. 1 FPC Ann.Rep. 156 (1921). This contemporaneous construction by the administering agency, combined with similar subsequent interpretations, is entitled to "great respect." Chemehuevi Tribe of Indians v. FPC, 420 U.S. 395, 409-10, 95 S. Ct. 1066, 1074-75, 43 L. Ed. 2d 279 (1975).

 During the existence of the FPC, the courts interpreted this authority in the same manner. Prominent among the decisions is First Iowa Hydroelectric Cooperative v. FPC, 328 U.S. 152, 66 S. Ct. 906, 90 L. Ed. 1143 (1946), in which the Court examined the purposes and powers of the Water Power Act and found that

It was the outgrowth of a widely supported effort of the conservationists to secure enactment of a complete scheme of national regulation which would promote the comprehensive development of the water resources of the Nation, in so far as it was within the reach of the federal power to do so, instead of the piecemeal, restrictive, negative approach of the River and Harbor Acts and other federal laws previously enacted. Id. at 180, 66 S. Ct. at 919.

 Courts at other times have used comparable language, emphasizing that the purpose of the Act was to provide for "comprehensive control" over water resources, FPC v. Union Electric, 381 U.S. 90, 98, 85 S. Ct. 1253, 1257, 14 L. Ed. 2d 239 (1959); to "centralize the authority" over water resources in one Government agency, Northwest Paper Co. v. FPC, 344 F.2d 47, 51 (9th Cir. 1965); and to give the FPC "exclusive jurisdiction." United States v. Idaho Power Co., 85 F.Supp. 913, 915 (D.Id.1949).

 Congress itself has also construed the authority of the FPC as exclusive. When the authority was transferred to FERC pursuant to the Department of Energy Organization Act of 1977, Pub.L.No. 95-91, § 402(a)(1), 91 Stat. 565, 584 (codified at 42 U.S.C. § 7172(a)(1) (Supp. III 1979) (the Energy Organization Act)), Congress stated in the Conference Report that:

Section 402(a) describes the exclusive jurisdiction of the Commission over certain functions transferred from the FPC. This exclusive jurisdiction consists of functions transferred from the FPC which will be within the sole responsibility of the Commission to consider and to take final agency action on without further review by the Secretary or any other executive branch official.

 H.R.Rep.No. 539, 95th Cong., 1st Sess. 75 (Conference Report), reprinted in (1977) U.S.Code Cong. & Ad.News 854, 925, 946. Specifically included in this "exclusive jurisdiction" is power to issue licenses for hydroelectric projects. Energy Organization Act, § 402(a)(1)(A), 91 Stat. 584 (codified at 42 U.S.C. § 7172(a)(1)(A) (Supp. III 1979)).

 While defendants and intervenors dispute the label "exclusive," and while the language used to describe the FPC's authority does vary, the reach of its jurisdiction prior to 1972 was clear. Congress had created an agency and centralized in it all federal authority for licensing federal water power projects. This exclusive licensing authority preempted any conflicting state regulation, see First Iowa Hydroelectric, 328 U.S. at 181-82, 66 S. Ct. at 919-20, and precluded any concurrent federal jurisdiction. This historic statutory policy was apparently reaffirmed at the time of the passage of the Energy Organization Act. Were it not for the existence of the FWPCAA, there would be no difficulty in holding that the FPC's power here was exclusive.

 However, the FWPCAA does exist and does disrupt the otherwise clear statutory mandate of the FPC. Section 404 of the FWPCAA, 33 U.S.C. § 1344 (Supp. III 1979), gives the Corps power to grant or deny permits for discharges of "dredged or fill material" into navigable waters. There is no exception for FPC-licensed hydroelectric projects. Since the Project concededly requires such a discharge, the Corps asserts that it, as well as the FPC, has the duty and the authority to license the project. Defendants contend that had Congress intended to preserve the FPC's exclusive licensing procedure, it could easily have done so and that the absence of an exemption in the 1972 FWPCAA is indicative of Congressional intent to give the Corps the power disputed here. They argue that this construction is further strengthened by the Clean Water Act of 1977, in which Congress passed a number of specific exemptions to the Corps' licensing authority but again failed to exempt hydroelectric projects. Pub.L.No. 95-217, § 67, 91 Stat. 1566, 1600-06 (codified at 33 U.S.C. § 1344(f) and (r) (Supp. III 1979)). This omission in 1977 is all the more striking in that Congress was on notice that the FWPCAA had been construed as applicable to water power projects. See Scenic Hudson Preservation Conference v. Callaway , 370 F.Supp. 162 (S.D.N.Y.1973), aff'd per curiam 499 F.2d 127 (2d Cir. 1974) (discussed more fully infra). The seemingly inevitable conclusion is that Congress, by not exempting FPC-licensed projects, intended them to be subject to the Corps' licensing jurisdiction.

 That, indeed, was the holding in the only case which has confronted the apparent conflict between the FPC's exclusive jurisdiction ...

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