AIR TRANSPORT ASSOCIATION OF CANADA, PETITIONER v. FEDERAL AVIATION ADMINISTRATION AND ADMINISTRATOR, FAA, RESPONDENTS
No. 01-1446
United States Court of Appeals FOR THE DISTRICT OF COLUMBIA CIRCUIT
Argued February 21, 2003 Decided April 8, 2003
Consolidated with 01-1447, 01-1448, 01-1449, 01-1450, 01-1451, 01-1452, 01-1455
On Petitions for Review of an Order of the Federal Aviation Administration
M. Roy Goldberg argued the cause for petitioners. With him on the briefs were Don H. Hainbach, Paul V. Mifsud, Frederick S. Hird, Jr., Shelia C. Cheston, Neil J. King,
Bills of costs must be filed within 14 days after entry of judgment. The court looks with disfavor upon motions to file bills of costs out of time.
Robert D. Kamenshine, Attorney, U.S. Department of Justice, argued the cause for respondents. With him on the brief were Kirk K. Van Tine, General Counsel, U.S. Department of Transportation, Paul M. Geier, Assistant General Counsel, Dale C. Andrews, Deputy Assistant General Counsel, David G. Leitch, Chief Counsel, Federal Aviation Administration, and Robert S. Greenspan, Attorney, U.S. Department of Justice.
Before: TATEL and GARLAND, Circuit Judges, and WILLIAMS, Senior Circuit Judge.
Opinion for the Court filed by Senior Circuit Judge WILLIAMS.
WILLIAMS, Senior Circuit Judge: For the third time, we must review the lawfulness of a Federal Aviation Administration regulation establishing fees for air traffic control services for “overflights” — flights by planes that go across some part of the United States but do not take off or land there. For the third time, we find that the FAA disregarded its statutory mandate.
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In 1996 Congress directed the FAA to set and collect fees for the provision of air traffic control services for “overflights.”
The FAA published its first interim final rule establishing fees in 1997, but we found that its methodology did not yield
In August 2001 the FAA re-promulgated the overflight rule in largely the same form as before. Fees for FAA Services for Certain Flights, 66 Fed. Reg. 43,680 (2001) (the “Final Rule“). Most importantly for this case, the agency retained the assumption that it incurred virtually identical per-mile costs in servicing overflights and non-overflights in the so-called Enroute and Oceanic airspaces. During the notice and comment period, petitioners reiterated their prior objections that labor costs incurred in providing traffic control services for overflights were substantially lower than for non-overflights, and submitted supporting declarations by two air traffic control experts. These experts most crucially contended that (1) traffic controller costs are not “fixed,” because the FAA varies the number of controllers on duty “depending on the volume of aircraft operating within the particular geographical area or sector“; (2) flights in the “High-Altitude” sector (18,000 feet and above) require far less controller attention per mile than flights in the “Low-Altitude” sector; (3) overflights occur almost exclusively in the High-Altitude
In response, the agency provided four arguments:
(1) The agency incurs the “vast majority of costs by making its comprehensive [air traffic control] system available to all flights (regardless of the type of aircraft ... )“;
(2) “[T]he FAA‘s marginal cost, including labor cost, for providing services to any flight is close to zero“;
(3) “[T]he majority of FAA‘s costs are common and fixed costs“; and
(4) “[T]he controllers’ responsibilities for Overflights are not fundamentally any different than for non-Overflights.”
Final Rule, 66 Fed. Reg. at 43,685/1. In support of these positions, the agency cited a new report by the economic consulting firm of Capital Economics; but the report failed to confront the challengers’ claims with evidence more specific, or with an analysis more compelling, than those of the agency‘s comments cited above.
On October 11, 2001 the petitioners filed in this court for review of the Final Rule. On November 19, 2001 Congress adopted a statute with language amending § 45301‘s standards for computing the overflight fee and limiting jurisdiction for judicial review. See § 119(d) of the Aviation and Transportation Security Act of 2001 (the “2001 Act“), Pub. L. 107-71. We save discussion of those provisions for later, but note in the meantime that the 2001 Act also included a savings clause, § 141(d), saying,
This Act shall not affect suits commenced before the date of the enactment of this Act [with certain irrelevant exceptions]. In all such suits, proceedings shall be had, appeals taken, and judgments rendered in the same
manner and with the same effect as if this Act had not been enacted.
Pub. L. 107-71, § 141(d).
As a result of the 2001 Act, FAA requested and received from this court a remand in this case to determine the extent to which the statutory amendments might require a modification of the Final Rule. The FAA received public comments but then terminated the remand proceeding in June 2002, deciding that § 119 “merely clarifies and amplifies congressional intent so as to provide further validation” of the Final Rule, so that no new rulemaking was required. 67 Fed. Reg. 42462, 42464/1 (2002). Thus, the appeal resumed.
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The FAA argues at the outset that § 119 of the 2001 Act deprives us of jurisdiction over the key issue of this case — the FAA‘s cost-allocation judgment. Section 119(d)(3) modifies
We pretermit the parties’ competing interpretations of just what “cost” determinations § 119(d)(3) screens from judicial review. The language of the savings clause quoted above clearly and explicitly bars the application of § 119(d)(3) to this suit — which indubitably “commenced before the date of enactment” of § 119. We note that the savings provision contains two explicit exceptions, but it is plain — and the FAA does not argue to the contrary — that neither has any relation to this case.
Thus the FAA is reduced to an exceptionally lame reliance on legislative history, pointing to language in the conference report to the effect that § 119 was intended “to clarify longstanding Congressional intent that the FAA expeditiously and continuously collect the fees authorized under section 45301(a) of title 49.” H. R. Conf. Rep. No. 107-296, at 72 (2001) (emphasis supplied by respondents). It argues that if we apply the savings clause as written this goal cannot be
Thus, we reach the merits. We have summarized above the assertions of petitioners’ experts, which make a substantial case refuting the agency‘s unexplicated insistence that miles of overflights and non-overflights in the Enroute and Oceanic airspaces are approximately equivalent in their per-mile generation of costs. In response the agency offers what amount to little more than conclusory denials.
Although consideration of the agency‘s specific arguments may seem like flogging a dead horse, we proceed with the exercise so that it may be assured that we have scrutinized its arguments. It said in the rulemaking, for example, that the controllers’ responsibilities in servicing overflights are not “fundamentally any different” from those involved in servicing non-overflights. Final Rule, 66 Fed. Reg. at 43,685/1. But there was never any contention by petitioners that the work differed in some inherent quality. The fact that the type of labor does not vary with flight altitude tells us little about the quantity of labor required to service the different
The agency observes that some overflights spend some time at low altitudes. But this does not undermine petitioners’ claim that they fly predominately in the high altitude sector, to a degree far greater than do non-overflights. If the agency has reason to believe that overflights occur non-trivially in the low-altitude range, obviously it can make adjustments to reflect that proposition.
The agency also insists that the benefits of the air traffic control system are somehow indivisible, so that throughout an aircraft‘s time in U.S. airspace it benefits from “the entire [air traffic control] infrastructure and full scope of services ..., regardless of the type of flight, user, or aircraft.” Appellee‘s Br. at 44-45. We may assume that planes at low altitudes benefit from services that keep high-altitude planes on course, and even the converse. But that in no way contradicts petitioners’ evidence that the costs of keeping planes on course vary markedly as between the high and low altitudes.
Nor does the agency fare better with its conclusions that “the FAA‘s marginal cost, including labor cost, for providing services to any flight is close to zero,” and, in what amounts to the same thing, “the majority of FAA‘s costs are common and fixed.” Final Rule, 66 Fed. Reg. at 43,685/1. These
The agency attempts to remedy this deficiency by arguing that because the FAA “has a set number of controllers to provide ... services nationwide ... [and t]hese numbers do not change daily to manage an additional Overflight, or a non-Overflight,” Final Rule, 66 Fed. Reg. at 43,709/3, fixed and common costs dominate; thus any difference in the marginal cost of servicing an additional overflight as opposed to an additional non-overflight is immaterial, id. at 43,709/3-710/1. But the lumpiness of costs, which is what the FAA points to here, is quite separate from the notion that costs do not systematically diverge as between the two services. Petitioners are not advocating that the FAA should somehow compute either the incremental or the marginal cost of servicing each overflight. On that subject, the FAA‘s observation that “the metering costs of identifying ... differences in marginal costs would be substantial,” id. at 43,709/3, is both pertinent and uncontradicted by petitioners. But it has no bearing on petitioners’ actual claim: that overflights occur almost exclusively in the high-altitude range, for which the FAA makes assignments of controllers separate from assignments for the low-altitude, and that per-mile servicing costs are systematically lower in the high-altitude range.
The agency finally turns to the substantive provisions of the 2001 Act. Where the statute previously required that the fees be “directly related to the ... costs,”
Finding the Final Rule “not in accordance with law,”
So ordered.