American Petroleum Institute v. Knecht

• Decision Date: 19 December 1979
• Docket Number: No. 78-3500,78-3500
• Citation: 609 F.2d 1306
• Parties: , 10 Envtl. L. Rep. 20,083 AMERICAN PETROLEUM INSTITUTE et al., Plaintiffs-Appellants, v. Robert W. KNECHT et al., Defendants-Appellees.
• Court: U.S. Court of Appeals — Ninth Circuit

Page 1306

609 F.2d 1306

14 ERC 1114, 10 Envtl. L. Rep. 20,083

AMERICAN PETROLEUM INSTITUTE et al., Plaintiffs-Appellants, v. Robert W. KNECHT et al., Defendants-Appellees.

No. 78-3500.

United States Court of Appeals Ninth Circuit.

Dec. 19, 1979.

Roger Beers, San Francisco, Cal., Donna R. Black, Los Angeles, Cal., on brief for plaintiffs-appellants; Howard J. Privett, Los Angeles, Cal., argued.

Donatas Januta (argued), San Francisco, Cal., Bruce C. Rashkow, Harold R. Schmidt, Lawrence A. DeMase, Pittsburgh, Pa., J. Roy Spradley, Jr., Washington, D. C., on brief for defendants-appellees; Eldon V. C. Greenberg argued.

Appeal from the United States District Court for the Central District of California.

Before BROWNING and GOODWIN, Circuit Judges and JAMESON, ^* District Judge.

PER CURIAM:

Plaintiffs-appellants, American Petroleum Institute, Western Oil and Gas Association, and certain oil company members of the Institute and Association, brought this action against three federal officials to enjoin "final approval" of the California Coastal Zone Management Program pursuant to the Coastal Zone Management Act of 1972, as amended (CZMA), 16 U.S.C. § 1451 Et seq. The district court in a detailed and well considered opinion denied injunctive relief and granted summary judgment affirming the federal defendants-appellees' approval of the California Program. American Petroleum Institute v. Knecht, 456 F.Supp. 889 (C.D.Cal.1978). ¹ We affirm. ²

Background

The Coastal Zone Management Act was enacted by Congress to preserve, protect, and develop the resources of the Nation's coastal zones. CZMA § 303. ³ The Act seeks to achieve wise use of land and water resources in coastal areas by providing monetary assistance to states that develop and exercise management programs consistent with its standards. CZMA § 302. ⁴ The Act charges the Secretary of Commerce with approving state programs. In performing this duty, he must be satisfied that the state program complies with requirements set forth in CZMA § 305 and § 306. ⁵ After the Secretary has approved a state plan the state receives federal grants that pay up to 80 per cent of the cost of administering their program. CZMA § 306(a). ⁶ Approval triggers a "federal consistency" provision in the CZMA which requires federal agencies, permittees, and licensees to show that their proposed developments in the coastal zones, including oil and gas developments on the Outer Continental Shelf, will comply with state management program requirements. Federal agencies may not approve proposed projects that are inconsistent with a coastal state's management program, except upon a finding by the Secretary that the project is consistent with the purposes of the Act or necessary in the interest of national security. CZMA § 307. ⁷

California was one of the first states to apply for and receive federal assistance under the CZMA. In November, 1972, voters approved the California Conservation Act which established the California Coastal Commission and six regional commissions to prepare a comprehensive plan for the long-range development and conservation of the state's coastal zone resources. In 1975 the Commission submitted its plan to the legislature and governor for approval. In 1976 the California legislature enacted the California Coastal Act which was similar to the Commission's proposed plan. The National Oceanic and Atmospheric Administration (NOAA), the approving agency under the Secretary of Commerce, then began working with state officials to assure that this legislation complied with the requirements of the CZMA.

In September, 1977, the plaintiffs brought this action to enjoin NOAA's approval of the California Program. In October, 1977, the district court issued an order allowing the federal defendants to approve the California Program, but enjoining enforcement of consistency provisions until the case could be resolved on its merits. The Acting Associate Administrator for Coastal Management, on behalf of the Secretary of Commerce, then approved the California Coastal Management Program under the CZMA. In August, 1978, the district court granted summary judgment in favor of the federal defendants, holding that (1) approval of the California Program complied with the requirements of the CZMA, (2) the Final Environmental Impact Statement complied with the requirements of the National Environmental Policy Act, and (3) the State could enforce the federal consistency provisions of CZMA § 307.

Contentions on Appeal

As they did in the district court, appellants challenge the Acting Administrator's findings that the California Program complied with the requirements of the CZMA. Their specifications of error with respect to the district court's affirmance of the agency's approval may be summarized as follows: (1) the court erred in applying the "arbitrary and capricious" standard of review and deferring to the agency's "expertise" in interpreting and applying the Act; and (2) the California Program failed to comply with numerous CZMA requirements, in that, Inter alia, (a) the program was not properly adopted by the State after adequate notice and hearing; (b) it is not sufficiently specific to inform users of the rules to which they are subject; (c) it does not include adequate provisions with respect to local coastal programs; (d) it does not contain the energy elements required; (e) it does not adequately consider the national interests; and (f) it does not protect against unreasonable restrictions on uses of regional benefit.

Appellees contend that the issues are not ripe for judicial review.

Ripeness

Following a careful analysis of the law of "ripeness", the district court held that (1) the approval given by the federal defendants pursuant to § 306 resulted in action which was ripe for review; but (2) no issues relating to the consistency provisions of § 307 were "presently ripe for disposition".

Recognizing that the issue of ripeness presents a close question, the district court concluded, after balancing all relevant factors, that the approval under § 306 was ripe for review, noting that this approval was the "culmination of the agency review process here involved" and that "there is nothing further to be done as a part of the administrative process, other than the obligation of 'continuing review' under § 312(a) . . . ." 456 F.Supp. at 898. The court found that all parties to the action might suffer substantial hardship if judicial review were denied and concluded that the interests of all parties would be served by the resolution at the earliest practicable date of the challenges to the program's approval. Id. at 902.

In holding that no issues regarding § 307 were ripe for review, the court concluded that, "Whether the state will utilize its consistency powers improperly to retard or halt energy development (is) wholly speculative," noting that no specific activities contemplated by plaintiffs and no anticipated refusals to certify have been presented.

We agree with the district court's findings and conclusions on the issue of ripeness, which are set forth in 456 F.Supp. at 897-903.

Standard of Review

After reviewing numerous cases construing the "arbitrary and capricious" standard of review, the district court recognized that deference is due an agency's interpretation of its own regulations and the statute it is charged with administering, and that the agency's decision should not be disturbed unless error is so clear as to deprive its decision of a rational basis. The court referred to the factors to be considered, as set forth in Mr. Justice Frankfurter's dissent in I.C.C. v. J-T Transport, 368 U.S. 81, 127, 82 S.Ct. 204, 7 L.Ed.2d 147 (1961), i. e., "the precision of the statutory language, the technical complexity of the relevant issues, the need for certainty as against experimentation, and the likelihood that Congress foresaw the precise question at issue and desired to express a foreclosing judgment on it." The court concluded that all four factors "here favor according considerable deference to the federal defendants' implicit interpretation of the NOAA program approval regulations". 456 F.Supp. at 907-908. ⁸

We agree with the district court and adopt its opinion with respect to "Standard of Review", 456 F.Supp. at 903-908, and "Scope of Review", Id. 908-912.

Adoption by the State

CZMA § 306(c)(1) requires that the Secretary in approving the state program find that the state "has developed and adopted a management program for its coastal zone in accordance with rules and regulations promulgated by the Secretary . . . ." Regulations adopted pursuant to this requirement provide that the "management program (be) . . . formally adopted in accordance with State law, or in its absence, administrative regulations . . . ." 15 C.F.R. § 923.31.

In finding that the adoption of the California Coastal Zone Management Program (CZMP) met the requirements of the CZMA, the Acting Administrator considered five elements: (1) the California Coastal Act of 1976; (2) the Coastal Conservancy Act of 1976; (3) the Urban and Coastal Parks Bond Act of 1976; (4) Coastal Commission Regulations promulgated pursuant to the Coastal Act of 1976; and (5) the "Program Description" (contained in Part II of the combined State of California Management Program and Final Environmental Impact Statement (FEIS)).

The first four elements present no problem. Appellants contend, however, that the "Program Description" was never "formally adopted in accordance with State law" and that the Acting Administrator in approving the program accordingly failed to comply with the Agency's own regulation.

The district court found that only Chapter 11 of the 14 chapters of the Program Description had been approved by the California Coastal Commission. ⁹ The court concluded, therefore, that the Acting Administrator's findings that the program satisfied the requirements of CZMA could only be based on the first...