West River Elec. Ass'n, Inc. v. Black Hills Power and Light Co., s. 89-5443
| Decision Date | 31 December 1990 |
| Docket Number | 89-5468,Nos. 89-5443,s. 89-5443 |
| Citation | 918 F.2d 713 |
| Parties | WEST RIVER ELECTRIC ASSOCIATION, INC., Appellee, v. BLACK HILLS POWER AND LIGHT COMPANY, Appellant, and Ellsworth Air Force Base. BLACK HILLS POWER AND LIGHT COMPANY, Appellant, v. HEARTLAND CONSUMERS POWER DISTRICT, Appellee. WEST RIVER ELECTRIC ASSOCIATION, INC., Appellee, v. BLACK HILLS POWER AND LIGHT COMPANY, Appellant, and Ellsworth Air Force Base. In the Matter of the Complaint of WEST RIVER ELECTRIC ASSOCIATION, INC., against Black Hills Power and Light Company and Ellsworth Air Force Base. In the Matter of the Complaint of BLACK HILLS POWER AND LIGHT COMPANY against Heartland Consumers Power District with Regard to Electric Service to Ellsworth Air Force Base. WEST RIVER ELECTRIC ASSOCIATION, INC., Appellant, v. BLACK HILLS POWER AND LIGHT COMPANY and Ellsworth Air Force Base, Appellees. WEST RIVER ELECTRIC ASSOCIATION, INC., Appellant, v. BLACK HILLS POWER AND LIGHT COMPANY and Ellsworth Air Force Base, Appellees. WEST RIVER ELECTRIC ASSOCIATION, INC., Appellant, v. BLACK HILLS POWER AND LIGHT COMPANY and Ellsworth Air Force Base, Appellees. BLACK HILLS POWER AND LIGHT COMPANY, v. HEARTLAND CONSUMERS POWER DISTRICT. In the Matter of the Complaint of WEST RIVER ELECTRIC ASSOCIATION, INC., against Black Hills Power and Light Company and Ellsworth Air Force Base. In the Matter of the Complaint of BLACK HILLS POWER AND LIGHT COMPANY against Heartland Consumers Power District with Regard to Electric Service to Ellsworth Air Force Base. |
| Court | U.S. Court of Appeals — Eighth Circuit |
David Morrill, Rapid City, S.D., for appellant.
Vincent Protsch, Madison, S.D., for appellee.
Before MAGILL, Circuit Judge, ROSS, Senior Circuit Judge, and LARSON, * Senior District Judge.
Black Hills Power and Light Company (Black Hills) appeals from a judgment of the district court 1 which held that Congress has not clearly and specifically deferred its exclusive jurisdiction over Ellsworth Air Force Base (Ellsworth), a federal enclave, sufficient to require that Ellsworth comply with South Dakota law in the procurement of its utility services. The district court concluded that Black Hills does not have the exclusive right to supply overrun electricity to Ellsworth and that instead Ellsworth may competitively purchase that electricity.
This case involves the second attempt on the part of Black Hills to secure the exclusive right, as conferred upon it by state law, 2 to provide electric service to Ellsworth. See Black Hills Power & Light Co. v. Weinberger, 808 F.2d 665 (8th Cir.) ("Weinberger"), cert. denied, 484 U.S. 818, 108 S.Ct. 73, 98 L.Ed.2d 36 (1987). The central issue presented on appeal is whether, by virtue of the Continuing Appropriations Act, Fiscal Year 1988, Pub.L. No. 100-202, Sec. 8093, 101 Stat. 1329, 1329-79 (1987) ("section 8093"), Ellsworth Air Force Base must follow the utility franchise territories prescribed by South Dakota law in procuring its electrical service. We conclude that as a federal enclave, Congress has exclusive jurisdiction 3 over Ellsworth Air Force Base and that in order to defer this exclusive jurisdiction to the State, Congress must clearly and unambiguously express as its purpose the deferral of such jurisdiction. We conclude that section 8093, as part of an appropriations bill, is insufficient to defer the exclusive grant of federal jurisdiction, nor was it intended to amend the extensive body of federal procurement law which establishes that federal agencies must use full and open competitive procedures in the procurement of their property and services.
Ellsworth Air Force Base is a military installation of the United States Air Force located in parts of Meade and Pennington Counties, South Dakota. Of the 4,856.76 acres occupied by Ellsworth, approximately 88% has been ceded by South Dakota to the exclusive jurisdiction of the United States. Weinberger, supra, 808 F.2d at 666.
The dispute which gave rise to this action originated in 1984, when the United States solicited bids for supplying the overrun electric power to Ellsworth. Prior to 1984, Ellsworth's main base electric power needs were met by an agency of the United States Department of Energy, the Western Area Power Administration (WAPA). However, in 1984, WAPA determined that it could no longer meet the needs of Ellsworth and thus the United States undertook to supply these overrun electricity needs through the solicitation of bids. Five suppliers submitted bids, including Black Hills, and Ellsworth chose the lowest bid, that of Heartland Consumers Power District. Accordingly, the United States and Heartland entered into a one-year contract in October, 1984. 4
On November 24, 1984, Black Hills filed a complaint with the South Dakota Public Utilities Commission ("Commission") arguing that Ellsworth is located in Black Hills' utility service territory, as established by state law, and therefore Ellsworth is required to obtain its overrun electric power from Black Hills. Following a three-day evidentiary hearing, the Commission found that under South Dakota law, Black Hills is entitled to be the exclusive provider of electric service to Ellsworth. Following removal to federal court, the district court held that there was a conflict between state and federal law, and that the supremacy clause, U.S. Const., art. VI, cl. 2, prevented the Commission from forcing the United States to contract with a specified electric utility. Additionally, the court determined that the Commission lacked jurisdiction over Ellsworth because Ellsworth is an exclusive federal enclave.
On appeal, the Eighth Circuit affirmed the district court's decision, finding that (1) Ellsworth is a federal enclave under exclusive federal jurisdiction; (2) nothing in federal procurement law directed Ellsworth contracting officials to follow state utility franchise law; and (3) none of the legislation enacted by Congress constituted a deferral of the exclusive federal jurisdiction. Weinberger, supra, 808 F.2d at 666.
Subsequent to the Supreme Court's denial of the petition for writ of certiorari in Weinberger, Congress passed an Act which contained a prohibition on the use of appropriated funds by any federal department, agency, or instrumentality in the procurement of electricity in a manner inconsistent with state law. Section 8093, supra. 5
Nine months after the passage of section 8093, Black Hills filed a motion with the South Dakota Public Utilities Commission, seeking reinstatement of its 1985 order, which required Ellsworth to purchase its overrun power from Black Hills in accordance with state law. Four days later, West River Association, Inc. filed a complaint with the Commission alleging that, because of a service territory boundary dispute, West River was entitled to be the sole supplier of overrun electric power to Ellsworth. These cases were consolidated and a hearing was held on September 29, 1988. On October 31, 1988, the Commission reinstated its 1985 order, requiring Ellsworth to acquire its excess power from Black Hills and to terminate the service contract between Ellsworth and Heartland. On August 14, 1989, the federal district court entered a memorandum opinion and order which held that, because Ellsworth is a federal enclave, the dictates of section 8093 do not apply. The court concluded that Weinberger continues to accurately state the law. This appeal followed.
The Supreme Court has explicitly held that "the grant of 'exclusive' legislative power to Congress over enclaves that meet the requirements of Art. I, Sec. 8, cl. 17, by its own weight, bars state regulation without specific congressional action." Paul v. United States, 371 U.S. 245, 263, 83 S.Ct. 426, 437, 9 L.Ed.2d 292 (1963). With regard to the Supremacy Clause of the Constitution, 6 the Supreme Court has stated: "Because of the fundamental importance of the principles shielding federal installations and activities from regulation by the States, an authorization of state regulation is found only when and to the extent there is 'a clear congressional mandate,' 'specific congressional action' that makes this authorization of state regulation 'clear and unambiguous.' " Hancock v. Train, 426 U.S. 167, 179, 96 S.Ct. 2006, 2013, 48 L.Ed.2d 555 (1976) (citations omitted); see also Citizens & Landowners v. Secretary, 683 F.2d 1171, 1178 (8th Cir.1982). "Particular deference should be accorded ... where, as here, the rights and privileges of the Federal Government at stake not only find their origin in the Constitution, but are to be divested in favor of and subjected to regulation by a subordinate sovereign." Hancock, supra, 426 U.S. at 179, 96 S.Ct. at 2012-13.
Here, the fact that Ellsworth is a federal enclave is without question. Weinberger, supra, 808 F.2d at 668. Unless section 8093 constitutes a specific grant of jurisdiction to the South Dakota State Public Commission, it is incontrovertible that the Commission does not have the authority to require Ellsworth to follow state utility service territories in purchasing electricity.
Black Hills argues that section 8093 constitutes a sufficiently "clear and unambiguous" congressional mandate which defers to state regulation the exclusive jurisdiction of the federal government over federal enclaves and prohibits Ellsworth from procuring utility services through competitive bidding. The district court rejected Black Hills' position, noting that section 8093 does not specifically include a "federal enclave" as an entity which must defer to state law in the procurement of its electric services. The district court found that because "federal enclaves" are not clearly included in the scope of section 8093, that section is ambiguous as applied to the facts of this case. The court concluded that section 8093 does not confer upon...
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