Deaf Smith County Grain Processors, Inc. v. Glickman

United States Court of Appeals

FOR THE DISTRICT OF COLUMBIA CIRCUIT

Argued November 16, 1998 Decided December 29, 1998

No. 98-5021

Deaf Smith County Grain Processors, Inc.,

Appellant

v.

Dan Glickman, Secretary,

United States Department of Agriculture,

Appellee

Appeal from the United States District Court

for the District of Columbia

(No. 95cv01214)

Alexander J. Pires, Jr. argued the cause and filed the

briefs for appellant.

Anthony M. Alexis, Assistant U.S. Attorney, argued the

cause for appellee. With him on the brief were Wilma A.

Lewis, U.S. Attorney, Mark E. Nagle and R. Craig Lawrence,

Assistant U.S. Attorneys, and Margaret Breinholt, Counsel,

U.S. Department of Agriculture.

Before: Edwards, Chief Judge, Silberman and Tatel,

Circuit Judges.

Opinion for the Court filed by Chief Judge Edwards.

Edwards, Chief Judge: In this appeal, Deaf Smith County

Grain Processors, Inc. ("Deaf Smith" or "appellant") contests

the District Court's grant of summary judgment in favor of

the United States Department of Agriculture ("USDA" or

"appellee") on Deaf Smith's claim that it has not received the

farm subsidy and disaster relief payments to which it is

allegedly entitled under USDA regulations. Our review in

this case is identical to that of the District Court; that is, we

uphold the agency action so long as it was not arbitrary,

capricious, an abuse of discretion, or otherwise not in accor-

dance with law. We agree with the District Court that the

USDA acted reasonably in denying Deaf Smith the payments

it requests. Accordingly, we affirm the grant of summary

judgment in favor of the agency.

I. Background

A.Regulatory Background

The USDA administers the nation's major agricultural

commodity programs through a wholly-owned Government

corporation called the Commodity Credit Corporation

("CCC"). See 15 U.S.C. s 714c (1994). The day-to-day oper-

ations of the CCC are performed by local chapters of the

Farm Service Agency ("FSA"), formerly known as the Agri-

cultural Stabilization and Conservation Service ("ASCS").

Two CCC programs are at issue in this case: the Production

Adjustment Program ("PAP") and the Disaster Assistance

Program ("DAP").

The goal of the Production Adjustment Program is to

reduce the total nationwide acreage of farmland devoted to

the production of certain crops. To achieve this goal, the

CCC pays farmers to limit their production of those crops.

In order to participate in the PAP, and thereby receive

payments from the CCC, farmers enter into annual contracts

with the CCC, pursuant to which they agree to limit their

cropland acreage and devote a certain amount of their land to

conservation uses approved by the USDA. See 7 C.F.R.

s 1421.5 (1998). In exchange, the CCC provides price sup-

port in the form of "deficiency" payments and nonrecourse

loans. The amount of these payments is determined by the

amount of farmland that the farmer agrees to withhold from

crop harvest. A farm's eligible acreage for farming a particu-

lar crop is called the crop acreage base ("CAB"). Each year,

the USDA determines a percentage of the CAB on which

farmers participating in the PAP are restricted from growing

crops, and calculates its deficiency payments accordingly. As

a result, the higher a particular farmer's CAB, the greater

the payments are from the CCC.

The Disaster Assistance Program provides relief for farm-

ers whose crops have been destroyed by natural disasters.

When struck by a natural disaster, a farmer may file an

application for disaster credit with the CCC. The USDA,

through the local branch of the FSA, then establishes bench-

mark crop "yields" and "rates" in order to calculate a particu-

lar farmer's disaster payments. See 7 C.F.R. s 1477.5 (1988).

The purpose of the "yields" and "rates" is to approximate the

value of the crops lost by estimating what the farmer's crop

would have been absent the disaster. A percentage of the

estimated value of the lost crops is then paid to the farmer in

the form of disaster relief.

B.Factual Background

Appellant is a large farming enterprise that does business

in the southwestern United States. During the 1980s, appel-

lant participated in both the PAP and the DAP, in connection

with its farms in Colfax County and Union County, New

Mexico. Appellant's two claims are essentially unrelated to

each other.

1.Appellant's PAP Claim

Appellant bought the land at issue in this case in 1986. In

1982, however, the Colfax County ASCS erroneously desig-

nated 3005.1 acres of this land "non-cropland," thus signifi-

cantly diminishing the land's CAB for the purposes of calcu-

lating payments under the PAP. The parties now agree that

this 3005.1 acres was cropland, and was therefore potentially

"eligible" for consideration in calculating the land's total CAB.

Appellant concedes that when it bought the land, it knew that

the CCC's "data on Appellant's cropland acreage was much

less and inconsistent with the cropland actually on the farm."

Brief for Appellant at 5.

When appellant bought the land in 1986, and every year

thereafter through 1989, it entered into a PAP contract with

the CCC. Each time it entered into a new annual contract,

the CCC provided notice of the CAB calculated for the land,

and informed appellant of its right to appeal this calculation

within fifteen days of receipt of the notice. It is undisputed

that appellant never formally appealed the CAB figure as-

signed to its land, even though it knew that the figure was

inaccurate. Appellant did complain orally to local ASCS

officials about the erroneous CAB. Appellant claims, howev-

er, that it was discouraged from filing formal appeals, because

the local officials represented that the documents needed to

clarify the mistake had been inadvertently destroyed. See

Brief for Appellant at 5-8. Appellant eventually filed a

Freedom of Information Act ("FOIA") request for the rele-

vant documents. The documents had not been destroyed,

and they vindicated appellant's assertion that the 3005.1 acres

was, indeed, cropland.

Appellant argues that it is entitled to retroactive payments

for the years 1986 through 1989 to reflect the payments that

should have been made had the proper CAB been used

during those years. Appellee responds that appellant was

aware of its actual cropland acreage when it entered into the

contracts with the CCC each year, and that both parties fully

performed in accordance with those contracts. Appellee con-

tends that these contracts "cannot be performed retroactive-

ly," and that the court should not construct "implied in law"

contracts to reflect hypothetical contracts that the parties

might have entered into had the proper CAB been used.

Brief for Appellee at 24. Furthermore, appellee points out

that appellant has not established that the disputed acres

were in fact devoted to conservation during 1986 through

1989; since the Colfax County ASCS had designated the land

"non-cropland," those 3005.1 acres were theoretically "freed

up ... for other uses." Id. at 21.

2.Appellant's DAP Claim

Appellant farmed wheat grass in New Mexico from 1986 to

1989. When wheat grass farmers in that region experienced

severe droughts in 1988 and 1989, Congress activated the

DAP to provide relief for those farmers. The USDA estab-

lished wheat grass yields and payment rates to calculate the

disaster payments for wheat grass farmers in New Mexico.

Appellant applied for disaster relief and was awarded pay-

ments based on those yields and rates.

Appellant contends, however, that the selected yields and

rates were too low, precluding the CCC from realistically

approximating the value of the crops destroyed by the

droughts. Specifically, appellant challenges the yield selected

because the USDA relied upon data that was admittedly

seventeen to thirty-one years old, see Appendix for Appellant

("A.A.") 73, and failed to use data from Colorado farms that

arguably would have better reflected appellant's crop growth

potential, see id. at 39. Appellant also challenges the pay-

ment rate selected, primarily on the basis of affidavits from

other farming enterprises, which suggest that the USDA's

rate was lower than rates that were used elsewhere. See,

e.g., id. at 79.

Appellee responds that the use of the disputed data was

necessary and reasonable given the fact that wheat grass

"was not a common crop in New Mexico" and no better data

was readily available. Brief for Appellee at 25. Indeed,

appellant points to no other data for New Mexico. Further-

more, according to appellee, it was proper for the USDA to

use the New Mexico data, as opposed to data collected in

Colorado, because appellant's farm is, in fact, in New Mexico.

As for the rate selected, appellee maintains that as long as

the rate selected is reasonable, appellant "may not complain

merely because there are other rates which also may be

reasonable." Id. at 31.

C.Procedural History

1.The Office of Inspector General Report

At the USDA's request, the USDA Office of Inspector

General ("OIG") reviewed appellant's PAP and DAP com-

plaints. The OIG issued its report on May 3, 1990. See A.A.

37-42. With respect to appellant's PAP claim, the OIG

concluded that the Colfax County ASCS had indeed "under-

stated" appellant's cropland, resulting in an "inadvertent[]"

miscalculation of appellant's CAB. Id. at 41. The OIG

suggested that, in response to this error, "[a]pplicable pro-

gram payments should ... be corrected as necessary." Id. at

42. With respect to appellant's DAP claim, the OIG "recog-

nize[d] the Disaster Program was implemented under tight

time constraints and difficult conditions," but nevertheless

"question[ed] whether it was proper to use 17- to 31-year-old

data." Id. at 40. The OIG also noted that the "Colorado

yields may more closely reflect [appellant's] growth poten-

tial." Id. As for the rate selected, the OIG found "no basis

for questioning the [USDA's] payment rate since it is similar

to Colorado's ... rate and was based on rates obtained from

New Mexico seed companies." Id.

Despite the statements favorable to appellant in the OIG

Report, the CCC refused to make the requested payments.

See Brief for Appellant at 13.

2.The National Appeals Division Decision

Appellant then sought relief through the USDA's adminis-

trative procedures, which culminated in a March 1995 deci-

sion of the National Appeals Division ("NAD") of the USDA.

See Determination of the National Appeals Division, Appeal

of Clifford Skiles, Jr. (Mar. 13, 1995) ("NAD Decision"),

reprinted in A.A. 5.

The NAD noted the existence of, and considered, the OIG

Report, see NAD Decision at 1, reprinted in A.A. 5, but found

in favor of appellee on both the PAP and the DAP claims.

With respect to the PAP claim, the NAD held that the

"contracts in question cannot be revised and program pay-

ments cannot be issued that exceed what was actually earned

under the contracts signed by Appellant and approved by

[the] CCC." Id. at 7, reprinted in A.A. 11. With respect to

the DAP claim, the NAD agreed that the data used in

calculating the yield was "somewhat aged"; however, the

NAD found that the data used was "the best data available at

that time and reflects the cropping conditions of the geo-

graphical location where the crop was grown." Id. at 8,

reprinted in A.A. 12. Finally, as for the payment rate, the

NAD found no "conclusive evidence that the rate was improp-

erly established or that it did not reflect actual market

conditions at that time." Id.

3.The District Court Opinion

Appellant appealed the NAD decision to the District Court.

Appellant's complaint in the District Court requested a total

of approximately $95,000 in damages. See Complaint p 25.

In a memorandum decision, the court granted appellee's

motion for summary judgment on both claims. See Deaf

Smith County Grain Processors, Inc. v. Glickman, Civ. Ac-

tion No. 95-1214 (D.D.C. Dec. 29, 1997) ("Order"), reprinted

in A.A. 1.

With respect to the PAP claim, the court noted that

appellant had been aware of the "true acreage of its farm-

land" when it purchased the land and when it entered into the

contracts each year with the CCC. Order at 2, reprinted in

A.A. 2. Furthermore, the court held, appellant "would not be

able to certify that [from 1986 to 1989] it planted or set aside

additional acres and/or otherwise complied with the additional

contract requirements." Id. at 2-3, reprinted in A.A. 2-3.

With respect to the DAP claim, the court held that the

"administrative record in this case clearly demonstrates that

defendant's actions in establishing the yields in question were

reasonable and that defendant had a rational basis in its

selection of the yields." Id. at 2, reprinted in A.A. 2.

Likewise, the court found no unreasonable conduct in the

selection of the payment rate. See id.

II. Analysis

A.Jurisdiction

It has long been settled that the federal Government may

be sued in federal court only if Congress has waived sover-

eign immunity for the lawsuit. See Cohens v. Virginia, 19

U.S. (6 Wheat.) 264, 411-12 (1821); First Va. Bank v. Ran-

dolph, 110 F.3d 75, 77 (D.C. Cir. 1997). The District Court's

jurisdiction over this case is founded on Congress's waiver of

sovereign immunity in 7 U.S.C. s 6999, which states, in its

entirety:

A final determination of the [National Appeals] Division

shall be reviewable and enforceable by any United States

district court of competent jurisdiction in accordance

with chapter 7 of Title 5.

Were it not for s 6999's specific reference to the judicial

review provisions of the Administrative Procedure Act

("APA"), 5 U.S.C. ss 701-706, there would be no doubt that

s 6999 is an effective waiver of the Government's sovereign

immunity in cases involving challenges to a decision of the

NAD, and that the District Court properly exercised jurisdic-

tion over this case. See Randolph, 110 F.3d at 77-78 (recog-

nizing district court jurisdiction where there is an express

waiver of sovereign immunity coupled with an express grant

of jurisdiction). However, because s 6999 states that final

determinations of the NAD shall be reviewed in the district

court "in accordance with" the APA, there is some question

whether the limits on the APA's waiver of sovereign immuni-

ty apply to this case. This is significant, because the APA

exempts from its waiver of sovereign immunity claims seek-

ing "money damages" from the Government, see 5 U.S.C.

s 702, and claims for which an "adequate remedy" is available

elsewhere, see id. s 704. See Transohio Sav. Bank v. Di-

rector, Office of Thrift Supervision, 967 F.2d 598, 607 (D.C.

Cir. 1992).

It is not clear whether this particular suit for monetary

relief from the federal Government can be characterized as a

claim for "money damages" within the meaning of s 702 of

the APA. Compare Kidwell v. Department of the Army, 56

F.3d 279, 284 (D.C. Cir. 1995) (noting that "a claim is subject

to the Tucker Act and its jurisdictional consequences if, in

whole or in part, it explicitly or 'in essence' seeks more than

$10,000 in monetary relief from the federal government" and

explaining that " '[j]urisdiction under the Tucker Act cannot

be avoided by ... disguising a money claim' as a claim

requesting a form of equitable relief") (citation omitted), with

Esch v. Yeutter, 876 F.2d 976, 984 (D.C. Cir. 1989) (holding

that challenge to USDA's decision to suspend farmers from

participation in subsidy programs was not an action for

"money damages" under Bowen v. Massachusetts, 487 U.S.

879 (1988), and was therefore not subject to Tucker Act

jurisdiction). If s 6999 is read to incorporate the APA's

"money damages" exception to sovereign immunity, and if

appellant's claim is one for "money damages," the District

Court is not a court of "competent" jurisdiction, because

sovereign immunity has not been waived. As a result, the

District Court would not have jurisdiction over this suit.

Moreover, if s 6999 is read to incorporate the judicial

review provisions of the APA, then it would appear that the

Tucker Act--which waives sovereign immunity and provides

the United States Court of Federal Claims ("Claims Court")

with jurisdiction over certain claims for monetary relief from

the federal Government, see 28 U.S.C. s 1491--provides an

"adequate remedy" in the Claims Court, which would pre-

clude district court jurisdiction under s 704 of the APA.

This, too, would militate against the District Court asserting

jurisdiction over this lawsuit.

We must therefore determine whether the "in accordance

with" language of s 6999 suggests that Congress intended

the district court to have jurisdiction over appeals from the

NAD only to the extent that such appeals would be permitted

under the APA. If so, jurisdiction over this case may

properly lie in the Claims Court, depending upon the resolu-

tion of the complicated APA and Tucker Act issues just

described. We need not decide these APA and Tucker Act

issues, however, because we are confident that--as both

parties to this lawsuit contend--Congress intended s 6999's

reference to the APA to govern only the procedural and scope

of review aspects of any appeal from the NAD. It did not

intend for the APA to govern the jurisdiction of the district

court over these kinds of claims. Accordingly, we hold that

s 6999 provides the district court with jurisdiction over all

final determinations of the NAD.

In reaching this conclusion, we have little to guide us but

our common sense. The parties claim that the "plain lan-

guage" of s 6999 is controlling. See, e.g., Appellee's Re-

sponse to Court's Order at 6. We disagree. The language of

s 6999, standing alone, is subject to several plausible inter-

pretations. The judicial review provisions of the APA refer-

enced by s 6999 contain both scope of review limitations, see,

e.g., 5 U.S.C. s 706(2)(A) (establishing the "arbitrary and

capricious" standard of review), and substantive limitations

upon judicial review of agency action, see, e.g., id. ss 702, 704

(establishing the "money damages" and "adequate remedy"

exceptions to the APA's waiver of sovereign immunity). To

say, as s 6999 does, that final determinations of the NAD are

reviewable by the district court "in accordance with" the

judicial review provisions of the APA is to say one of three

things: (i) that the NAD determinations are reviewable to the

extent allowed by ss 702 and 704 of the APA; (ii) that NAD

determinations are reviewable under the procedures set forth

in s 706 of the APA; or (iii) that NAD determinations are

reviewable pursuant to all of the judicial review provisions of

the APA. If anything, the language supports the third

option, given that s 6999's reference to "chapter 7 of Title 5"

is unbounded.

The parties both assert that to adopt this third interpreta-

tion would be to render s 6999 meaningless. Appellant's

theory is that if s 6999 provides jurisdiction in the district

court only for claims that would be reviewable under the

APA, the district court would be effectively divested of juris-

diction over any NAD appeals, because all such appeals

would fall within the exceptions to the APA's grant of sover-

eign immunity. According to appellant, "all appeals from

NAD determinations could be held 'in essence' to involve

claims of entitlement to monetary relief from the federal

government ... and thus implicate Tucker Act jurisdiction."

Appellant's Supplemental Brief at 6. Appellee disagrees with

that contention. See Appellee's Response to Court's Order at

9 (asserting that appellant's DAP claim "would not meet the

narrow view of what is or is not 'money damages' "). Never-

theless, appellee agrees with appellant that an interpretation

that subjects s 6999 to the APA's limits on sovereign immuni-

ty would violate the "basic canon of statutory construction"

that "a proper interpretation of [a] legislative provision must

give all of the words of the provision meaning." Id. at 5.

Appellee's reasoning does not make sense in this context.

If it is true that some appeals from the NAD would not

involve claims for "money damages" and also would not be

subject to the Tucker Act--and we suspect that this is the

case, cf. Esch, 876 F.2d at 984-85 (holding that lawsuit filed

prior to the creation of the NAD was neither for "money

damages" nor subject to the Tucker Act)--then s 6999 may

plausibly be read to provide jurisdiction in district court only

for those appeals from the NAD that do not run afoul of the

APA's "money damages" and "adequate remedy" exceptions.

Such a reading would not render s 6999 meaningless. Nev-

ertheless, we agree that the statute is ambiguous. Therefore,

because the language of s 6999 provides no solution to the

jurisdictional problem in this case, we turn to the history of

s 6999--legislative and otherwise--in an effort to ascertain

Congress's intent.

Unfortunately, the little legislative history that exists for

s 6999 is as ambiguous as the statute itself. Section 209 of

the Senate version of the Department of Agriculture Reorga-

nization Act of 1994 contained a provision that was virtually

identical to the provision that eventually became s 6999. See

S. 1970, 103d Cong. s 209 (1994). The committee report

accompanying the bill contained the following discussion of

s 209:

This section provides that a final determination of the

[National Appeals] Division can be appealed to a U.S.

District Court. Analysis of which issues are subject to

judicial review shall conform with provisions of the Ad-

ministrative Procedure Act (APA).

S. Rep. No. 103-241, at 15 (1994). The parties make much of

this language. They claim that it unambiguously supports

the proposition that Congress "referred to the APA in the

judicial review provision not to specify the location of the

review but rather to specify the methodology of the review to

be conducted." Appellee's Response to Court's Order at 7;

see also Appellant's Supplemental Brief at 5.

Although the first sentence of the quoted paragraph is

quite straightforward, we do not agree that the meaning of

the second sentence is readily apparent. It is certainly far

from clear that an "[a]nalysis of which issues are subject to

judicial review" would involve only the APA's procedural and

scope of review provisions, such as s 706, and not, say, s 704,

which expressly describes the agency actions that are "sub-

ject to judicial review." Because the first sentence contains

no limitation on the right of appeal to the district court, we

are of the view that the committee's statement, read as a

whole, is ambiguous. However, we do not accept the parties'

contention that it positively supports their position.

Armed only with this single sentence of legislative history,

the parties urge us to consider as well "the clearest indication

of legislative intent," which is that the pre-s 6999 state of

affairs was marked by numerous "thorny and frustrating"

jurisdictional disputes, Appellee's Response to Court's Order

at 7-8, and that Congress enacted s 6999 in order to remove

the confusion surrounding this issue. Appellee contends that

"[i]t does not make sense that Congress intended, in a statute

that was designed to improve the conditions involved in the

review of farm program decisions, to leave jurisdictional

gridlock in place." Appellee's Response to Court's Order at

9-10. Although the lack of legislative history to support the

proposition is somewhat troubling, we do agree that, given

the history of the NAD, Congress most likely intended s 6999

to vest jurisdiction over appeals from the NAD in one, and

only one, forum--the district court.

Prior to 1994, claims such as appellant's were heard in an

administrative tribunal known as the National Appeals Divi-

sion, which is not to be confused with the present-day NAD.

See 7 U.S.C. s 1433e(c) (Supp. III 1991) (repealed 1994).

Final decisions of that National Appeals Division--generally

referred to as the "old NAD"--were, by statute, "reviewable

by a United States court of competent jurisdiction." Id.

s 1433e(d). As a practical matter, s 1433e(d) gave litigants

(usually farmers seeking benefits under particular USDA

programs) the choice of filing their claims in either the

Claims Court or in district court. See Christopher R. Kelley

& John S. Harbison, A Guide to the ASCS Administrative

Appeal Process and to the Judicial Review of ASCS Deci-

sions, 36 S.D. L. Rev. 435, 439 (1991). Apparently, due to the

perception that review in district court was generally more

favorable to farmers than review in the Claims Court, farm-

ers often attempted to draft their complaints to avoid the

Tucker Act. See Alexander J. Pires, Jr., Why the U.S.

Claims Court is Not a Viable Venue for Farmers: The U.S.

Claims Court's Handling of Agricultural Cases, 1980-1990,

15 U. Ark. Little Rock L.J. 223, 259 (1993) (suggesting

techniques for avoiding Claims Court jurisdiction, including

such advice as "do not plead a breach of contract count" and

"plead for equitable relief"). The USDA, for its part, fre-

quently challenged the district court's jurisdiction on the

ground that the farmers' claims were actually for "money

damages." See, e.g., Justice v. Lyng, 716 F. Supp. 1567,

1568-69 (D. Ariz. 1988); Alan R. Malasky et al., Resolving

Federal Farm Program Disputes: Recent Developments, 19

Wm. Mitchell L. Rev. 283, 327 & nn.361-62 (1993). It

appears that courts could not agree on the appropriate venue

for the farmers' claims; some were heard in the Claims

Court, see, e.g., Wardlaw Farms, Inc. v. United States, 32

Fed. Cl. 475 (1994), while others were heard in the district

court, see, e.g., Justice. In short, there was "considerable

confusion" over this jurisdictional question. Kelley & Harbi-

son, 36 S.D. L. Rev. at 440; see also Malasky et al., 19 Wm.

Mitchell L. Rev. at 326 (referring to this jurisdictional

question as a "recurring problem[]" in USDA litigation).

Against this backdrop, Congress created the "new" NAD in

1994, and concurrently enacted the judicial review provision

at issue in this case. Significantly, s 6999 differs from the

judicial review provision of the old NAD, in that it vests

authority to review NAD decisions in "any United States

district court of competent jurisdiction" (emphasis added).

By specifying that jurisdiction would lie in the district court,

Congress was arguably signaling its intent to remove the

specter of the Tucker Act--and the Claims Court--from the

judicial review of NAD decisions. Commentators appear to

have assumed that s 6999 "finally puts to rest the Govern-

ment's ... argument that all actions seeking judicial review

of USDA determinations denying farm program benefits are

really actions for 'money damages' which must be brought in

the [Claims Court] under the Tucker Act." Alan R. Malasky

& William E. Penn, USDA Reorganization--Fact or Fic-

tion?, 25 U. Mem. L. Rev. 1161, 1183 (1995). Moreover,

although certainly not dispositive, we find quite relevant the

fact that it is now "the position of the United States that 7

U.S.C. s 6999 provides district courts with jurisdiction to

conduct judicial review of all determinations made by the

NAD." Appellee's Response to Court's Order at 2. After all,

it was the United States that routinely challenged the district

courts' jurisdiction over these claims prior to the creation of

the new NAD, so the Government's present position is at

least noteworthy.

We are convinced that a contrary reading of s 6999--one

founded on the view that the district court had jurisdiction

over only those appeals from the NAD that were not claims

for "money damages"--would result in perhaps even greater

"jurisdictional gridlock" than existed prior to the passage of

s 6999. For example, if we determined that appellant's PAP

claim was one for "money damages," but its DAP claim was

not, jurisdiction over the NAD decision at issue in this case

could potentially lie in both the District Court and the Claims

Court. We agree with the parties that it is highly unlikely

that, given the jurisdictional confusion and uncertainty that

reigned prior to the creation of the new NAD, Congress

intended this result. In the end, although the evidence is not

overwhelming and the language of the statute is far from

unambiguous, it appears that the purpose of s 6999 was to

simplify appeals from the NAD by placing jurisdiction over

them solely in the district court. Accordingly, the District

Court properly exercised jurisdiction over this case, and we

may now address the merits.

B.Standard of Review

As we have just articulated, s 6999 mandates that the

District Court review, as it has, the final determination of the

NAD under the APA's "arbitrary and capricious" standard of

review. On appeal from the District Court, we review the

NAD's decision de novo, see Dr. Pepper/Seven-Up Cos. v.

FTC, 991 F.2d 859, 862 (D.C. Cir. 1993), and will uphold it

unless we find it to be "arbitrary, capricious, an abuse of

discretion, or otherwise not in accordance with law." 5

U.S.C. s 706(2)(A); see also Motor Vehicles Mfrs. Ass'n v.

State Farm Mut. Auto. Ins. Co., 463 U.S. 29, 41-44 (1983).

C.The PAP Claim

Appellant contends that it is entitled to retroactive pay-

ments under the PAP, in order to compensate it for the

erroneous designation of 3005.1 acres of its land as "non-

cropland." Appellee admits that the Colfax County ASCS

incorrectly reduced the amount of cropland it attributed to

appellant. See Brief for Appellee at 20-21. However, it is

undisputed that appellant nevertheless knowingly entered

into contracts with the CCC each year to receive PAP

payments based on the erroneous amount of cropland that

was attributed to the farm. It is also undisputed that the

payments made under the contracts were correct pursuant to

the terms of those contracts. Although appellant would have

been entitled to additional payments had the contracts accu-

rately reflected the "eligible" cropland, the fact remains that

the contracts did not so reflect that cropland. And, signifi-

cantly, appellant never formally appealed the CABs that had

been attributed to its farm, despite adequate notice of its

ability to do so. See NAD Decision at 7, reprinted in A.A. 11

("The administrative record contains no evidence that Appel-

lant timely submitted an appeal concerning the CABs estab-

lished for the farm during the specified time period for

appeals to be filed.").

By neglecting to formally appeal the CABs, appellant failed

to exhaust its administrative remedies. Its action, at least

with respect to this claim, is therefore barred. See 7 U.S.C.

s 6912(e) (1994) ("[A] person shall exhaust all administrative

appeal procedures established by the Secretary [of Agricul-

ture] or required by law before the person may bring an

action in a court of competent jurisdiction against ... the

Secretary."). Appellant protests that it "orally contested the

accuracy of [the CABs] ... and that Appellee discouraged

any formal appeal by erroneously telling Appellant that the

history records needed to appeal the cropland acreage and

CAB[s] had probably been destroyed." Brief for Appellant at

19. Appellant's claim--that it failed to avail itself of the

procedures available to contest the assigned CAB because it

was induced not to by low-level USDA officials--is, at bottom,

an equitable estoppel claim against the Government. Under

clear precedent of the Supreme Court, we are constrained to

reject such a claim.

In Office of Personnel Management v. Richmond, 496 U.S.

414, 415-16 (1990), the Court emphatically dismissed the

notion that "erroneous oral and written advice given by a

Government employee to a benefits claimant" would "give rise

to estoppel against the Government and so entitle the claim-

ant to a monetary payment not otherwise permitted by law."

The Court noted that the "whole history and practice with

respect to claims against the United States reveals the impos-

sibility of an estoppel claim for money in violation of a

statute," id. at 430, and went on to say that "[t]o open the

door to estoppel claims would only invite endless litigation

over both real and imagined claims of misinformation by

disgruntled citizens, imposing an unpredictable drain on the

public fisc," id. at 433. Appellant in this case seeks to avoid

the exhaustion requirement on the ground that USDA offi-

cials erroneously advised him of the futility of pursuing his

administrative remedies. His claim, although not labeled as

such, falls squarely within the category of equitable estoppel

claims against the Government that the Court precluded in

Richmond.

In any event, even if appellant's claim were not barred for

failure to exhaust, we would be unable to grant appellant the

relief it seeks. As the District Court noted, the record does

not establish what appellant did with the land that was

erroneously designated "non-cropland." See Order at 2-3,

reprinted in A.A. 2-3. Thus, even if we could reconstruct the

contracts between appellant and the CCC--a question that

we need not address--appellant would still have the burden

of establishing not only that it did not farm the disputed acres

during the relevant period, but also that it "complied with the

additional contract requirements," such as setting aside a

portion of the land for certain USDA-approved conservation

uses. See id. at 3, reprinted in A.A. 3. Appellant has not

met its burden of proof on these points.

In sum, the NAD's decision to deny appellant's appeal on

the PAP claim was reasonable. The NAD was not compelled

to follow the recommendations of the OIG Report. The

question at issue here is whether the agency's decision mak-

ing was arbitrary and capricious, and we hold that it was not.

D.The DAP Claim

With respect to appellant's claim under the DAP, we agree

with the District Court that there is nothing in the record to

suggest that the agency acted arbitrarily or capriciously when

it set the yields and rates for wheat grass payments. See

Order at 1-2, reprinted in A.A. 1-2.

The USDA arguably could have selected yields and rates

that were more favorable to appellant. It may even be true

that the USDA failed to use the most accurate data that it

could have found in setting the yield. For example, according

to the OIG Report, USDA officials were told when they

received the New Mexico data that data from Colorado might

"better reflect[]" the actual crop growth in the area surround-

ing appellant's farm. A.A. 39. However, given the "tight

time constraints and difficult conditions" under which the

local USDA officials were operating, id. at 40, it was not

unreasonable for the officials to rely on the New Mexico data,

given that appellant's farm was located in that state. See

North Carolina v. FERC, 112 F.3d 1175, 1190 (D.C. Cir.

1997) (stating that although estimates agency used to select

growth rates might have been less reasonable than other

available data, "the fact that these estimates were less 'rea-

sonable' does not necessarily make them unreasonable or

arbitrary"); National Wildlife Fed'n v. Burford, 871 F.2d

849, 855 (9th Cir. 1989) (noting that under the arbitrary and

capricious standard, "[t]he action ... need be only a reason-

able, not the best or most reasonable, decision"). Further-

more, we are unconvinced that the agency's use of this data

was unreasonable merely because it was, in the words of the

NAD, "somewhat aged." NAD Decision at 8, reprinted in

A.A. 12. Appellant's talismanic repetition of the data's age,

see, e.g., Brief for Appellant at 21, does nothing to illuminate

why data of this type does not maintain its accuracy over

time.

As for the USDA's payment rate, even the OIG Report

found "no basis for questioning" it, because it was so similar

to other rates in the area, and was based on rates obtained

from New Mexico seed companies. A.A. 40. It is not

surprising that appellant can point to other rates in existence

at the time that were higher than the rate chosen by the

USDA. See, e.g., Complaint p 24. These comparative data

cannot carry the day, for the issue here is whether the rate

chosen was reasonable; and there is simply nothing in the

record to suggest that the rate chosen was anything but

reasonable. Appellant does not even claim that the method

by which the USDA calculated its rate was, in any way,

flawed. In fact, appellant concedes that the USDA used the

"methodology set forth" in the USDA's own handbook. Brief

for Appellant at 10.

In short, appellant has failed to establish that the agency's

action with respect to its DAP claim was unreasonable.

Accordingly, we uphold the determination of the NAD with

respect to this claim as well.

III. Conclusion

For the reasons stated above, we affirm the judgment of

the District Court.

So ordered.