Etsi Pipeline Project v. Missouri Hodel v. Missouri

Decision Date23 February 1988
Docket Number86-941,Nos. 86-939,s. 86-939
Citation98 L.Ed.2d 898,484 U.S. 495,108 S.Ct. 805
PartiesETSI PIPELINE PROJECT, Petitioner, v. MISSOURI et al. Donald P. HODEL, Secretary of the Interior, et al., Petitioners, v. MISSOURI et al
CourtU.S. Supreme Court
Syllabus

In 1982, petitioner ETSI Pipeline Project entered into a 40-year contract with petitioner Secretary of the Interior to withdraw up to a certain amount of water per year from Lake Oahe, a reservoir located on the Missouri River in South Dakota, for use in an interstate coal slurry pipeline. Respondents Missouri, Iowa, and Nebraska filed suit in Federal District Court to enjoin performance of the contract, alleging that, under the Flood Control Act of 1944 (Act), the Interior Secretary lacked authority to execute a contract to provide water from the reservoir for industrial uses without obtaining the approval of the Secretary of the Army. Pursuant to the Act, the Oahe Reservoir was built by the Corps of Engineers, now part of the Department of the Army (successor of the Department of War), which has always maintained and operated the reservoir. The Act was directed to both flood control and navigation matters that concerned the War Department, and reclamation and irrigation problems that concerned the Interior Department, thus also implicating the tensions between the Upper Missouri River Basin States' interests in irrigation and reclamation and the interests of the Lower Basin States (including respondents) in flood control. The District Court ruled for respondents, and the Court of Appeals affirmed.

Held: The Secretary of the Interior exceeded the authority Congress delegated to him by the Act. Pp. 505-517.

(a) In light of the Act's provisions specifying the powers of the Secretary of the Army and the Secretary of the Interior particularly the former's authority as to the use and disposal of water at any reservoir under the Army Department's control—as well as the Act's general background, the Interior Secretary does not possess the authority to execute a contract to provide water from an Army reservoir for industrial use without obtaining the Army Secretary's approval. Under the Act's language, if the Interior Secretary wishes to remove water from an Army reservoir for any purpose, the approval of the Army Secretary must be secured. As long as ample water remains in the Oahe Reservoir for the purposes embodied in the Act, and absent any allocation for irrigation pursuant to the Act's terms—the record supporting the District Court's findings that there was no such allocation or use of the reservoir's water for irrigation—the Army Secretary has exclusive authority to contract to remove water for industrial use. Pp. 505-509.

(b) There is no merit to petitioners' contention that the Act's provisions approving general comprehensive plans for projects to be operated by both the Interior and Army Departments represent congressional approval of any functional division of authority between those Departments and allows the Interior Secretary unilaterally to remove water from Army reservoirs for irrigation purposes and for other related uses. Such contention is wide of the mark in view of the Act's specific jurisdictional provisions discussed above as to the use of Army reservoirs, and is grounded on a misuse of the legislative history. There is no indication that control over individual reservoirs was to be divided among various Departments of the Federal Government. Nor is petitioners' argument supported by a provision of the Act stating that reclamation and power developments to be undertaken by the Interior Secretary shall be governed by federal reclamation laws, which authorize him to reallocate water under his control for industrial use. Such provision of the Act applies only to projects that the Interior Department itself may undertake under the Act. But as the District Court found, the reservoir project engineered by the Army at Oahe is neither a power development nor a reclamation development undertaken by the Interior Secretary. Moreover, there is no merit to petitioners' contention that, although the Interior Department must consult with the Army Department before withdrawing water for industrial use from the Oahe Reservoir, the Interior Department can proceed without the Army Department's approval as long as the latter does not object. Pp. 509-515.

(c) It is unnecessary to consider petitioners' contention that deference to the Interior Secretary's interpretation of the Act is appropriate here, and their related arguments about the history of relations between the Army and Interior Departments under the Act, for even if the Interior Department's interpretation would be entitled to any deference in these circumstances, the Executive Branch is not permitted to administer the Act in a manner that is inconsistent with the administrative structure that Congress enacted into law. The Act speaks directly to the dispute, and congressional intent as expressed in the Act indicates clearly that the Interior Secretary may not enter into a contract to withdraw water from an Army reservoir for industrial use without the approval of the Army Department. Pp. 515-517.

787 F.2d 270, affirmed.

WHITE, J., delivered the opinion of the Court, in which all other Members joined, except KENNEDY, J., who took no part in the consideration or decision of the case.

Jeffrey P. Minear, Washington, D.C., for petitioners.

Elizabeth M. Osenbaugh, Des Moines, Iowa, for respondents.

Justice WHITE delivered the opinion of the Court.

We must decide whether in the circumstances of this case the Secretary of the Interior has exceeded the authority Congress delegated to him by the Flood Control Act of 1944.

I

The dispute centers on Lake Oahe, an enormous reservoir located on the Missouri River in South Dakota, with a capacity of more than 23 million acre-feet of water. In 1982, ETSI Pipeline Project entered into a contract with the Secretary of the Interior to withdraw up to 20,000 acre-feet of water from Lake Oahe per year for 40 years.1 South Dakota already had granted ETSI a state permit to use this water in a coal slurry pipeline that would transport coal from Wyoming to the southeastern United States. Soon after the contract was signed, the States of Missouri, Iowa, and Nebraska brought suit in District Court to enjoin performance of the contract, alleging that the manner in which the contract was approved violated several federal statutes. In particular, the plaintiffs contended that the Interior Secretary lacks statutory authority under the Flood Control Act of 1944 (Act), 58 Stat. 887, to execute a contract to provide water from Lake Oahe for industrial uses without obtaining the approval of the Secretary of the Army.2

The District Court ruled for the plaintiffs. Missouri v. Andrews, 586 F.Supp. 1268 (Neb.1984). It concluded that the Oahe Dam was not a reclamation or power development that was undertaken by the Interior Secretary, pursuant to clear statutory authority. Instead, the dam was built by the Corps of Engineers, now part of the Department of the Army (formerly the Department of War, but renamed by Act of July 26, 1947, 61 Stat. 495), which has always maintained and operated the reservoir. No block of water in Lake Oahe has been specifically set aside for use by the Interior Department, and the Interior Secretary has not constructed any works at Lake Oahe. On these facts, the District Court held that the Act does not empower the Interior Secretary to furnish water from Lake Oahe for industrial use.

The Court of Appeals affirmed, with one judge dissenting. Missouri v. Andrews, 787 F.2d 270 (CA8 1986). It upheld the District Court's conclusion that Lake Oahe is not a reclamation development undertaken by the Interior Secretary, primarily because the Army built the reservoir and controls its operation. Accordingly, the Interior Secretary cannot contract on his own to withdraw water from the reservoir for industrial use. Neither the language nor the legislative history of the Act was thought to support the claim that the Interior Secretary was ceded broad authority over water in this reservoir, even water that it claims has been designated as available for future irrigation purposes. Indeed, the language of the Act and its legislative history were found to be convincing enough on this point that the Court of Appeals refused to defer to the Interior Secretary's contrary interpretation.

The Court of Appeals denied a petition for rehearing en banc by an equally divided vote of the judges. We granted certiorari, 480 U.S. 905, 107 S.Ct. 1346, 94 L.Ed.2d 517 (1987), and we now affirm.

II
A.

The Missouri River Basin is a watershed that covers a vast area in the midwestern United States. The topography of this area, however, reveals two distinct regions that experience very different water problems. The upper part of the Basin, which includes large sections of Montana, Wyoming, North Dakota, and South Dakota, is mostly arid or semiarid; there, the Missouri River and its tributaries are important because they represent a major resource for developing the agricultural and industrial potential of the area. The lower part of the Basin, which includes territory in Nebraska, Kansas, Iowa, and Missouri, is more humid, and there the rivers are used chiefly for navigation, though the critical problem in this region is to control flooding. See generally M. Ridgeway, The Missouri Basin's Pick-Sloan Plan 47-55 (1955). In the early 1940's, Congress focused its attention on the water problems of the Missouri River Basin, prompted especially by severe floods that had devastated the lower Basin in 1943 and 1944.

At the behest of Congress, the Army Corps of Engineers prepared a report that described a comprehensive plan to develop the entire Basin, known as the Pick Plan for its author, a colonel in the Corps. The Pick Plan proposed the construction of 12 multiple-purpose reservoirs and...

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