Porter County Chapter of Izaak Walton League of America, Inc. v. Costle
| Decision Date | 20 March 1978 |
| Docket Number | Nos. 76-2098 and 77-1262,s. 76-2098 and 77-1262 |
| Parties | , 8 Envtl. L. Rep. 20,216 PORTER COUNTY CHAPTER OF the IZAAK WALTON LEAGUE OF AMERICA, INC., Save the Dunes Council, Inc., Ann Sims and Herbert P. Read, Petitioners, v. Douglas COSTLE, Administrator, United States Environmental Protection Agency, Respondent, Northern Indiana Public Service Company, Intervenor. |
| Court | U.S. Court of Appeals — Seventh Circuit |
Marvin N. Benn, Edward W. Osann, Jr., Chicago, Ill., for petitioners.
William H. Eichhorn, Hammond, Ind., William T. Hart, Chicago, Ill., for intervenor.
Alfred T. Ghiorzi, Lloyd S. Guerci, Attys., Dept. of Justice, Washington, D. C., for respondent.
Before FAIRCHILD, Chief Judge, COWEN, * Senior Judge, and CUMMINGS, Circuit Judge.
This case involves the interpretation of Public Law 89-298 1 as it applies to the control of pollutants from the Northern Indiana Public Service Company (NIPSCO) generating plant into Lake Michigan at Burns Waterway Harbor adjacent to the Indiana Dunes National Lakeshore. The question is whether the Environmental Protection Agency's (EPA) grant of a seemingly lawful discharge permit to NIPSCO under section 402 of the Federal Water Pollution Control Act of 1972, as amended, (FWPCA) 2 was nonetheless unlawful, because EPA ignored a higher standard established for pollution control in the vicinity of Burns Harbor under Public Law 89-298. Petitioners, the Izaak Walton League, et al., (League) contend that they have properly exhausted their administrative remedies before EPA; that this court has jurisdiction over this action, and that the EPA Administrator's decision interpreting Public Law 89-298, should be reversed. We hold that the action is properly before this court, but that the legislative history and a fair interpretation of this statute warrant affirmance of the Administrator's decision on the merits.
On October 31, 1974, the Director of the Enforcement Division of Region V of EPA, pursuant to section 402 of the FWPCA, 3 issued a National Pollutant Discharge Elimination System (NPDES) permit to NIPSCO for its coal-fired Bailly generating station adjacent to Burns Harbor. This permit required NIPSCO to heed certain effluent limitations 4 and other special conditions. On November 14, 1974, NIPSCO requested an adjudicatory hearing 5 to resolve questions on the permit. EPA granted this request and gave public notice of the hearing on June 27, 1975. In response to this notice, the petitioners filed a request for party status on July 28, 1975. EPA granted this request on August 29, 1975.
As a result of a prehearing conference held on November 12, 1975, the presiding officer certified to the General Counsel of EPA for decision what has become the major issue in this litigation. Petitioners contended that Public Law 89-298 should have been applied by EPA's Regional Director of Enforcement in issuing NIPSCO a permit to discharge pollutants into Burns Harbor under the FWPCA. Specifically, the petitioners contended the following provision in Public Law 89-298 mandates a higher standard than does section 402 of the FWPCA and that EPA should have followed this higher standard in issuing the permit to NIPSCO.
(Prior to the construction of the Harbor project the) State of Indiana shall furnish assurance satisfactory to the Secretary of the Army that water and air pollution sources will be controlled to the maximum extent feasible in order to minimize any adverse effects on public recreational areas in the general vicinity of (Burns) Harbor (emphasis added). 6
On June 9, 1976, the General Counsel of EPA decided:
Congress clearly left the determination of the scope of such assurance (about control of pollution near Burns Harbor) to the discretion of the Secretary of the Army. * * *
* * * The Act on its face does not impose any obligations on parties other than those named in it. (EPA was not named). In the absence of compelling legislative history to the contrary, I conclude that Public Law 89-298 has no applicability in establishing effluent limitations for the NPDAS permit at issue. 7
On July 6, 1976, the petitioners filed a petition to the Administrator for review of this decision. He first considered the "ripeness" of the petition for review and decided that, since the decision of the General Counsel would "undergo no further refinements" prior to the decision of the Regional Administrator about the NPDES permit, he would exercise his "inherent discretion to entertain the instant Petition." 8 He then denied the petition on the merits on August 10, 1976.
On October 7, 1976, the Regional Administrator issued the initial decision authorizing the issuance of an amended NPDES permit to NIPSCO. At this time the parties entered into a stipulation which resolved factual issues and preserved legal questions pertaining to Public Law 89-298. When the petitioners did not seek any further review with the Administrator within 10 days, the initial decision of the Regional Administrator on the permit became the final decision of the Agency. 9
On November 8, 1976, the petitioners filed their first appeal (No. 76-2098) with this court seeking judicial review of the Administrator's decision of August 10, 1976, with respect to Public Law 89-298. On December 7, 1976, the Director of Enforcement of Region V formally issued the NPDES permit to NIPSCO. On March 7, 1977, the petitioners filed their second appeal to this court (No. 77-1262), seeking judicial review of the order of December 7, 1976, issuing the permit. In particular, the appeal challenges the Administrator's decision of August 10, 1976, with respect to Public Law 89-298. By order of May 9, 1977, and by amendment of May 16, 1977, this court ordered the consolidation of the two appeals (Nos. 76-2098 and 77-1262).
The intervenor in these appeals, NIPSCO, contends that the petitioners are not properly before this court, because they did not exhaust their administrative remedies prior to filing either of the appeals. EPA also contends that appeal No. 76-2098 was premature. We need not pass on that question in view of our holding that the petitioners sufficiently exhausted their administrative remedies in appeal No. 77-1262.
With respect to appeal No. 77-1262, NIPSCO first invokes 40 C.F.R. § 125.36(l )(4) 10 as providing that the October 7, 1976, initial decision of the Regional Administrator issuing the permit to NIPSCO, became the final decision of the Agency when an appeal was not taken to the Administrator following this decision. This is a correct reading of the EPA regulations. NIPSCO then argues that such an appeal was a "prerequisite to judicial review," and since petitioners did not pursue that avenue prior to appealing to this court on March 7, 1977, they have failed to exhaust their administrative remedies. NIPSCO asserts that they have not provided the Agency with an opportunity to correct its errors and to moot judicial controversy, and also that a court of appeals is entitled to the full benefit of the expertise of an administrative agency and of a complete record.
NIPSCO has provided this court an accurate reflection of axioms requiring exhaustion of administrative remedies. Nevertheless, NIPSCO has ignored the very axiom which is decisive with respect to the matter at hand. A remedy need not be exhausted if to do so would be a futile gesture. City Farmers Trust Co. v. Schnader, 291 U.S. 24, 34, 54 S.Ct. 259, 78 L.Ed. 628 (1934); Montana Nat'l Bank of Billings v. Yellowstone County, 276 U.S. 499, 505, 48 S.Ct. 331, 72 L.Ed. 673 (1928); Davis, Administrative Law Treatise, § 20.07, at 99 (1958). This is the case here.
The EPA regulations cited by NIPSCO do contemplate that prior to judicial review of a permit, the Administrator must have an opportunity to review the contested issues concerning the permit. 11 Furthermore, the Administrator, in his August 10, 1976, decision following the petitioners' original appeal to him of the General Counsel's decision relative to Public Law 89-298, has recognized that normally an appeal of the General Counsel's decision should not be filed until the Regional Administrator has issued an initial decision on the permit. 12 Nevertheless, this case does not involve the usual situation. The Administrator, also in his August 10, 1976 decision, found that the same EPA regulations which contemplate review after the initial decision on the permit leave some room for interpretation. 13 Further, he decided that since the decision of the General Counsel regarding Public Law 89-298 could "undergo no further refinements prior to the initial decision" on the permit, he would exercise his "inherent discretion" to entertain the petition early. 14 Thus he was given, and he accepted, the opportunity to rule definitively on the sole substantive issue on appeal before this court. The respondent Agency does not now seek further opportunity for review, but instead joins the petitioners' contention that administrative remedies have been properly exhausted. In this context, a second administrative review on the applicability of Public Law 89-298 to the permit would serve no useful purpose. 15
NIPSCO also argues that the petitioners' application for judicial review of the permit in No. 77-1262 has not been filed in a timely and proper manner pursuant to the FWPCA. The Act reads in pertinent part:
(b)(1) Review of the Administrator's action * * * (F) in issuing or denying any permit under section 1342 of this title, may be had by any interested person in the Circuit Court of Appeals * * *. Any such application shall be made within ninety days from the date of such determination, approval, promulgation, issuance or denial * * *. (emphasis added). 16
In appeal No. 77-1262, the Regional Director of Enforcement formally issued the permit to NIPSCO on December 7,...
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