LaFlamme v. F.E.R.C.

• Decision Date: 18 March 1988
• Docket Number: No. 85-7571,85-7571
• Citation: 842 F.2d 1063
• Parties: Harriet F. LaFLAMME, Petitioner, v. FEDERAL ENERGY REGULATORY COMMISSION, Respondent. Joseph Keating * , Respondent-Intervenor.
• Court: U.S. Court of Appeals — Ninth Circuit

Page 1063

842 F.2d 1063

27 ERC 2018

Harriet F. LaFLAMME, Petitioner, v. FEDERAL ENERGY REGULATORY COMMISSION, Respondent.

Joseph Keating ^*, Respondent-Intervenor.

No. 85-7571.

United States Court of Appeals, Ninth Circuit.

Argued and Submitted Oct. 2, 1986.

Decided March 18, 1988.

Glenn M. Kottcamp, Fresno, Cal., for petitioner.

John N. Estes III, F.E.R.C., Office of Gen. Counsel, Washington, D.C., for respondent.

Stuart L. Somach, McDonough, Holland & Allen, Sacramento, Cal., for respondent-intervenor.

Petition to Review a Decision of the Federal Energy Regulatory Commission.

Before SCHROEDER, NORRIS and BRUNETTI, Circuit Judges.

BRUNETTI, Circuit Judge:

Harriet LaFlamme has petitioned for review of two orders issued by the Federal Energy Regulatory Commission ("FERC"), (1) an order filed September 26, 1983 granting Joseph Keating a license to construct and operate a hydroelectric power project on the South Fork of the American River, and (2) an order filed August 23, 1985 denying her petition for a rehearing. We conclude that the order denying LaFlamme's petition for rehearing must be set aside, the order granting a license vacated, and this matter remanded to FERC for further consideration.

I. Facts and Proceedings Below

On May 27, 1980, Joseph Keating filed an application for a preliminary permit for a power project. FERC issued the permit on December 11, 1980. Thereafter, Keating consulted with federal, state, and local agencies, who provided their comments on the license proposal. On April 29, 1982, Keating filed an "Application for License for a Major Water Power Project" to be built on the South Fork of the American River ("the River") in an area called Sayles Flat, in El Dorado County, California.

The proposed project consists of: (1) a 130-foot-long, 8.4-foot-high diversion structure with a Bascule gate; (2) a 2.3-acre reservoir with 6 acre-feet of usable capacity; (3) an intake structure; (4) a 4,000-foot-long, 42-inch-diameter steel penstock; (5) a powerhouse containing two generating units, one unit rated at 950 kW and one mobile unit rated at 2000 kW; (6) a 1,200-foot-long transmission line; and (7) appurtenant facilities.

On June 16, 1982, FERC directly mailed notice of the license application to state and federal agencies and published notice of the application in the Mountain Democrat and Times on July 9, 16, 23, and 30, 1982. FERC requested the agencies' comments on the application, pursuant to the applicable statutes, including the National Environmental Policy Act, 42 U.S.C. Sec. 4332 (1982) ("NEPA") and the Federal Power Act, 16 U.S.C. Sec. 791a et seq. ("FPA").

None of the responding federal agencies objected to the license or recommended any special conditions. Similarly, state agencies were generally in accord with the federal agencies, although there were some disagreements and suggested changes with regard to minimum flow releases in the river. However, the public response was overwhelmingly negative. Complaints included water purification problems resulting from wiping out the river's four cascades, death of vegetation and wildlife due to inadequate minimum streamflows, and the loss of 4200 feet of rushing water with its opportunities for recreational and aesthetic pleasure.

On January 17, 1983, Harriet LaFlamme petitioned FERC to intervene in this license application proceeding. On March 9 of that year, FERC granted LaFlamme's motion. On September 26, 1983, FERC granted the project license to Keating. In the order issuing the license, FERC addressed most of the concerns raised by LaFlamme and the agencies during the application period: economic feasibility and need for power; recreation; cultural resources; water quality; aquatic and terrestrial resources; streamflow measurement; modification of project facilities and operation; minimum flows; environmental impacts; headwater benefits project coordination; other aspects of comprehensive development; and the need for a public hearing. FERC's discussion of each of these concerns varied, ranging from perfunctory to in-depth analysis. FERC concluded that the project would be "best adapted to a plan for the comprehensive development of the river basin for beneficial uses upon compliance with the terms and conditions of the license" and therefore complied with the Federal Power Act. ¹ Additionally, FERC concluded "that the issuance of a license for the project will not constitute a major Federal action significantly affecting the quality of the human environment," and therefore compliance with NEPA ² did not require promulgation of an environmental impact statement.

On October 24, 1983, LaFlamme petitioned FERC for a rehearing of Keating's license approval. LaFlamme objected to approval of Keating's license application on the following general grounds: no comprehensive plan for development of the American River Basin; no cumulative impact study; no consideration of the project's impact on scenic and aesthetic resources; inadequate assessment of environmental impact; inadequate mitigation measures; faulty analysis of economic feasibility and need for power; inadequate assessment and accommodation made for recreational resources; inadequate examination of cultural resources; and inadequate assessment of project's impact on water quality.

On August 28, 1984, Keating entered into a memorandum of agreement with the United States Forest Service which sought, among other things, "to define the respective responsibilities of Keating and of the Forest Service with respect to public utilization of project waters and adjacent lands for recreational purposes [and] protection of scenic resources...." Keating and the Forest Service agreed to conduct a two season recreation study, focusing on riparian vegetation, recreational use, and aesthetics in the project area. This study was intended to serve as the basis for modifying instream flow releases for purposes other than fishery protection.

On August 23, 1985, FERC entered an order rejecting all of LaFlamme's arguments and denied her petition for rehearing. FERC affirmed their finding that the project was needed, economically feasible, and would not adversely impact cultural, aquatic or terrestrial resources.

Additionally, in this order, FERC discussed the project's site-specific impacts on what they considered to be the most important and most severely affected resource: the recreational use and visual quality of the project area. Previously, FERC had incorporated into the license, verbatim, six measures Keating suggested would adequately mitigate the project's impact on recreational use and visual quality: (1) develop a 0.5-mile-long hiking trail along the proposed penstock alignment--the penstock river crossing would also incorporate into the design a footbridge, an integral part of the trail; (2) maintain the proposed reservoir shoreline to abate erosion already occurring along the river; (3) develop a beach area on the south shoreline of the reservoir, with three picnic tables and barbeque pits; (4) develop a footbridge across the proposed impoundment to provide access to the camp; (5) provide vegetative screenings where appropriate; and (6) rehabilitate and preserve a portion of the Old Placerville Road/Stagecoach Trail to include a rustic-designed bridge across the river. While noting the recreational-type cabin developments in the project area and the Camp Sacramento recreational facility immediately adjacent to the proposed facility, FERC concluded that these six proposed mitigation measures "would provide for the public recreation needs of the project in the immediate future." This conclusion was based on the FERC's staff's December 29, 1982 report, entitled "Environmental Evaluation Report on FERC Project No. 3195-003" (Keating's Project number), and on the August 28, 1984 memorandum of agreement between Keating and the Forest Service. However, nowhere in these documents or in Keating's application was any recreational use data reported for the immediate project area. As a result, FERC's conclusions regarding the recreational use and visual quality of the project area were based upon FERC staff's analysis of data pertaining to the Echo Lake Development, which is located three miles from Keating's project.

In their order denying LaFlamme's petition for rehearing, FERC did not dispute LaFlamme's assertion that the project would have an impact on recreational use and aesthetic quality in the project area. They discussed the memorandum of agreement entered into between Keating and the Forest Service on August 28, 1984, and agreed that the project warranted a post-licensing two recreation season study as decided upon by Keating and the Forest Service.

Accordingly, in its order denying the petition for rehearing, FERC added a new condition to the Sayles Flat project license, contained in Article 44. Article 44 provides as follows:

Article 44. The Licensee shall, in consultation with the U.S. Forest Service, conduct a recreation use-visual quality study. The study shall address, among other things: locations of recreation use areas; existing recreation use types, patterns, and amounts; the value of recreation uses and significance of sites; the potential impacts of the project on recreation; and alternative recreation options and mitigation measures. The study shall also examine the relationship of visual aesthetics to streamflows and recreation uses and the feasibility and impacts of establishing different day-time and night-time instream flows to protect and enhance recreation use and visual quality at the project site during the peak recreation season (Memorial Day to Labor Day). The study shall be conducted over a two-peak recreation-season period, and a report embodying the results of the study, together with recommendations regarding different day-time and night-time instream flows, shall be filed with the Commission within 90 days after the expiration of the second...