36 F.4th 1164
D.C. Cir.2022Background
- FERC renewed a license for hydroelectric dams on the Yadkin River; North Carolina issued a Section 401 water-quality certification that became part of the federal license.
- The City of Salisbury operates a municipal pump station ~20 miles upstream; rising river levels and sediment accumulation created flood risks to access and to elevated equipment rooms.
- North Carolina conditioned certification on Cube (licensee) developing a flood-protection plan for the pump station (including physical modifications, improved access consistent with Salisbury’s road design, or other feasible options).
- Cube’s plan: dredging, remote-operation electronics, an amphibious vehicle for access, and raising the station’s sensitive equipment above projected extreme flood levels.
- Salisbury preferred a new pump station and argued the plan violated state building/design codes and engineering standards; FERC approved Cube’s plan and declined to adjudicate general state-law code compliance or apply a dam-engineering regulation.
- Salisbury petitioned for review; the court denied the petition, holding FERC correctly construed the certification and reasonably approved the plan.
Issues
| Issue | Plaintiff's Argument (Salisbury) | Defendant's Argument (FERC/Cube) | Held |
|---|---|---|---|
| 1) Should courts defer to FERC’s interpretation of a state-imposed water-quality certification? | FERC must not be given controlling interpretive authority over state certification terms. | FERC urges deference to its construction of license conditions. | Court reserved the deference question but found FERC’s interpretation was the best one, so deference need not be resolved. |
| 2) Does the phrase “consistent with the City of Salisbury’s design” qualify only the access clause or also the physical-modifications and residual clauses? | Phrase qualifies all three clauses, effectively requiring physical modifications or alternatives to match the city’s desired new-station design. | Phrase grammatically and reasonably qualifies only the improved-access clause; it does not reach the physical-modifications or general residual clause. | Court held the phrase modifies the nearest reasonable referent (access) only; it does not extend to modifications or other-feasible-options for modifications. |
| 3) What are the “same benefits” that alternatives must achieve (keep station dry vs. maintain operation)? | The certification requires multiple benefits, including keeping the pump station entirely dry during floods. | The relevant benefits are those the station was designed to provide: continued operation (keeping sensitive equipment above flood levels), not guaranteeing dry floors/walls. | Court held “same benefits” means continued operation consistent with original design; the certification does not mandate a dry interior. |
| 4) Was FERC’s approval arbitrary for failing to assess state-code compliance, §12.5 engineering standards, or worker-safety concerns? | FERC should have considered state siting/design/building/electrical codes, applied sound-engineering requirements, and addressed worker safety. | Project-operational control is federal but non-project, off-project facilities remain primarily state-regulated; §12.5 does not apply to a non-power pump station; worker-safety claims were not preserved. | Court held FERC reasonably declined to police general state-law code compliance, properly declined to apply §12.5 here, and lacked jurisdiction on unpreserved worker-safety arguments; approval was not arbitrary. |
Key Cases Cited
- S.D. Warren Co. v. Me. Bd. of Envtl. Prot., 547 U.S. 370 (2006) (Clean Water Act preserves states’ role in certifying projects that may discharge to navigable waters).
- U.S. Dep’t of Interior v. FERC, 952 F.2d 538 (D.C. Cir. 1992) (FERC may not alter state-imposed certification conditions).
- Pacific Gas & Elec. Co. v. FERC, 720 F.2d 78 (D.C. Cir. 1983) (agency deference principles when construing license conditions).
- Lockhart v. United States, 577 U.S. 347 (2016) (last-antecedent rule for limiting clauses).
- Facebook, Inc. v. Duguid, 141 S. Ct. 1163 (2021) (series-qualifier canon and when a qualifier can apply to multiple list items).
- Grecian Magnesite Mining, Indus. & Shipping Co. v. Comm’r, 926 F.3d 819 (D.C. Cir. 2019) (nearest reasonable referent principle in modifier attachment).
- Truck Trailer Mfrs. Ass’n v. EPA, 17 F.4th 1198 (D.C. Cir. 2021) (discussion of deference and when courts may reserve deference questions).