Public Utility Com'r of Oregon v. Bonneville Power Admin.

• Decision Date: 05 September 1985
• Docket Number: 84-7185,Nos. 84-3722,s. 84-3722
• Citation: 767 F.2d 622
• Parties: PUBLIC UTILITY COMMISSIONER OF OREGON, Pacific Power & Light Company, Portland General Electric Company, and CP National Corporation, Petitioners-Appellants, v. BONNEVILLE POWER ADMINISTRATION, and Peter T. Johnson, Administrator, Bonneville Power Administration, Respondents-Appellees, and Aluminum Company of America, et al., Intervenors.
• Court: U.S. Court of Appeals — Ninth Circuit

Page 622

767 F.2d 622

PUBLIC UTILITY COMMISSIONER OF OREGON, Pacific Power & Light

Company, Portland General Electric Company, and CP

National Corporation, Petitioners-Appellants, v. BONNEVILLE POWER ADMINISTRATION, and Peter T. Johnson,

Administrator, Bonneville Power Administration,

Respondents-Appellees,

and

Aluminum Company of America, et al., Intervenors.

Nos. 84-3722, 84-7185.

United States Court of Appeals, Ninth Circuit.

Argued and Submitted Sept. 14, 1984.

Decided Aug. 1, 1985.

As Amended Sept. 5, 1985.

Marcus Wood, Guy A. Randles, Pamela J. Jacklin, Stoel, Rives, Boley, Fraser & Wyse, Portland, Or., Paul A. Graham, Asst. Atty. Gen., Salem, Or., Alvin Alexanderson, Portland General Electric Co., Portland, Or., for petitioners-appellants.

Charles H. Turner, U.S. Atty., Jack G. Collins, Thomas C. Lee, David J. Adler, John A. Cameron, Jr., Portland, Or., M. Laurence Popofsky, Peter A. Wald, Dian M. Grueneich, Heller, Ehrman, White & McAuliffe, San Francisco, Cal., for respondents-appellees.

Appeal from the United States District Court for the District of Oregon.

Before KENNEDY, ALARCON, and FERGUSON, Circuit Judges.

KENNEDY, Circuit Judge:

The principal issue in these consolidated cases is whether, under the judicial review provisions of the Pacific Northwest Electric Power Planning and Conservation Act, 16 U.S.C. Sec. 839, et seq. (1982) (the Act), jurisdiction of suits which challenge ongoing agency proceedings on constitutional grounds is solely in the district court, concurrently in the district court and the court of appeals, or exclusively in the court of appeals. A secondary issue is whether we should exercise our own jurisdiction under the All Writs Act, 28 U.S.C. Sec. 1651(a) (1982), to review alleged bias in agency proceedings which have not yet concluded. We conclude that section 9(e)(5) of the Act, 16 U.S.C. Sec. 839f(e)(5) (1982), coupled with the All Writs Act, affords this court exclusive jurisdiction to determine the claims made by petitioners, and that we will not exercise our jurisdiction to do so pending final agency action.

Petitioners, the Public Utility Commissioner of Oregon (Oregon PUC), and three investor-owned utilities (IOU's) sued the Bonneville Power Administration (BPA) in the district court, challenging the constitutionality of ongoing agency proceedings. Petitioners alleged proceedings to revise certain rate formulas were initiated by BPA Administrator Peter Johnson with an unalterably closed mind as to the outcome, and that his participation in the proceedings violated their Fifth Amendment right to due process. The district court dismissed the action for lack of subject matter jurisdiction. Public Utility Commissioner of Oregon v. Bonneville Power Administration, 583 F.Supp. 752 (D.Or.1984). Petitioners appealed from the district court dismissal and filed an original action in this court raising claims identical to those raised in the district court. The appeal and the original action have been consolidated for decision in order to resolve the jurisdictional issues.

We affirm the dismissal of the suit in the district court. As to the action commenced in this court, we lack subject matter jurisdiction under the Act as there is no final agency action, and decline to review petitioner's challenge by way of mandamus under the All Writs Act, 28 U.S.C. Sec. 1651(a).

To understand the issues posed by the parties in this case, a brief look at the operation of the Act and the administrative proceedings surrounding this litigation is necessary. One of the goals of the Act is to ensure that residential consumers served by Northwest IOU's have wholesale rate parity with residential consumers served by publicly owned utilities and public cooperatives, BPA's preference customers. Parity is to be achieved through Residential Purchase and Sale Agreements between BPA and IOU's. Under a residential agreement, IOU's exchange their own higher priced power at its "average system cost" (ASC) for an equivalent amount of lower cost BPA power. The agreement involves bookkeeping entries only; BPA makes a payment to the IOU for the difference between the IOU's ASC and BPA's preference rate. The Act requires the IOU's to pass the savings on to their customers. 16 U.S.C. Sec. 839c(c)(3) (1982).

BPA is to recoup its losses resulting from residential agreements, i.e., the price differential between the IOU's ASC and BPA's preference rate, primarily by charging higher rates to its direct service industrial customers (DSI's) until July 1, 1985. After that time, other BPA customers may bear a greater portion of the costs of the exchange. See 16 U.S.C. Sec. 839e(c)(1)(B); 16 U.S.C. Sec. 839e(c)(1)(A) (1982). The DSI's have a particularly strong interest in how the IOU's ASC was computed for the contract year July 1, 1984 to June 30, 1985, since the rates they pay for power during that contract year establish a floor for all future rates paid by DSI's. See 16 U.S.C. Sec. 839e(c)(2) (1982).

The Act provides that the ASC shall be determined on the basis of a methodology developed by the BPA Administrator in consultation with the Pacific Northwest Electric Power and Conservation Planning Council, BPA's customers, and regional state regulatory bodies. 16 U.S.C. Sec. 839c(c)(7) (1982). Before the ASC methodology is implemented, it must be approved and confirmed by the Federal Energy Regulatory Commission (FERC). See 18 C.F.R. Sec. 35.13(a) (1984).

BPA first adopted a methodology for computing the ASC in August 1981. After interim approval and formal administrative proceedings, FERC gave final approval to the methodology in September 1983. At the request of the DSI's, BPA initiated a new ASC consultation in October 1983. The DSI's and BPA believed the then current ASC methodology failed to exclude IOU costs required to be excluded by the Act, 16 U.S.C. Sec. 839c(c)(7), resulting in DSI rates that were unlawfully high. After providing for considerable public participation, BPA published a proposed ASC methodology. On February 3, 1984, while public consultation sessions were still being conducted, petitioners filed suit in the district court alleging that Johnson's participation in the ASC methodology proceedings denied them due process because Johnson was "absolutely committed" to lowering the ASC calculation, thereby reducing payments to exchanging utilities under the residential agreements. Petitioners sought to have Johnson and his subordinates enjoined from participating in the ASC methodology consultation and asked the district court to delegate decisional authority to an independent hearing officer.

On June 5, 1984, while this litigation was pending, BPA adopted and submitted the revised ASC methodology to FERC with a request for interim approval by July 1, 1984. Although the Commission decided not to grant interim approval, it issued a final order approving and implementing the revised ASC methodology as submitted by BPA on October 1, 1984. These events have rendered moot petitioner's original request for injunctive relief. However, since BPA will undertake to make further revisions to the ASC methodology, this interlocutory challenge to allegedly biased proceedings is capable of repetition, yet evading review. See Weinstein v. Bradford, 423 U.S. 147, 149, 96 S.Ct. 347, 348, 46 L.Ed.2d 350 (1975) (per curiam); California Energy Resources Conservation and Development Commission v. Bonneville Power Administration, 754 F.2d 1470, 1473 (9th Cir.1985); NAACP Western Region v. City of Richmond, 743 F.2d 1346, 1352-53 (9th Cir.1984); Planned Parenthood v. Arizona, 718 F.2d 938, 949-50 (9th Cir.1983). The underlying jurisdictional issue thus remains, and resolution by this court is appropriate.

The district court concluded jurisdiction to consider petitioner's interlocutory challenge to BPA's rulemaking proceedings lies with the court of appeals, not the district court. The court did not squarely hold that the Ninth Circuit had jurisdiction under the Act's jurisdictional provision, but only that the remedy, if any, is in the Ninth Circuit. 583 F.Supp. at 756.

Section 9(e)(5) of the Act, which provides for judicial review, states:

Suits to challenge the constitutionality of this chapter, or any action thereunder final actions and decisions taken pursuant to this chapter by the Administrator or the [Northwest Power Planning] Council, or the implementation of such final actions ... shall be filed in the United States court of appeals for the region. Such suits shall be filed within ninety days of the time of such action or decision is deemed final.... Suits challenging any other actions under this chapter shall be filed in the appropriate court.

16 U.S.C. Sec. 839f(e)(5).

In two previous cases, we have held that suits to challenge final actions must, under the Act, be brought in the court of appeals. Forelaws on Board v. Johnson, 709 F.2d 1310, 1313 (9th Cir.1983); Central Lincoln Peoples' Utility District v. Johnson, 686 F.2d 708, 710 (9th Cir.1982) (Central Lincoln I ), rev'd on other grounds sub nom., Aluminum Company of America v. Central Lincoln People's Utility District, --- U.S. ----, 104 S.Ct. 2472, 81 L.Ed.2d 301 (1983). However, unlike Forelaws and Central Lincoln I, where certain power contracts offered by BPA were challenged, this suit involves a constitutional challenge to BPA's proceedings. For this reason, petitioners' first contention is that the Act's jurisdictional section is simply inapplicable to their suit, and that the district court has jurisdiction under 28 U.S.C. Sec. 1331. In essence, petitioners seek to evade the first sentence which requires suits challenging the constitutionality of actions be brought in the court of appeals, by arguing they are not challenging an "action," but rather a proceeding. To support their argument, petitioners point to the savings clause in the last sentence of the provision as evidence that Congress did not intend to vest the court...