Appellees Brief — Hodel v. Virginia Surface Mining & Reclamation Assn., Inc.

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Nos. 79-1538 and 79-1596

IN THE

Supreme Court of the United States

OcTOBER TERM, 1980

CECIL D. ANDRUS, SECRETARY OF THE INTERIOR,

Appellant,

Vv.

VIRGINIA SURFACE MINING AND RECLAMATION

ASSOCIATION, INC., ET AL.

VIRGINIA SURFACE MINING AND RECLAMATION

ASSOCIATION, INC., ET AL.,

Appellants,

Wises

¥,

CeciL D. ANDRUS, SECRETARY OF THE INTERIOR

OR A et i

4 On Appeals From The United States District

Court For The Western District of Virginia

a ee

BRIEF FOR THE VIRGINIA SURFACE MINING AND

RECLAMATION ASSOCIATION, INC.,

THE TOWN OF WISE VIRGINIA, AND

THE COMMONWEALTH OF VIRGINIA

JOHN L. KILCULLEN

e 1800 M Street, N.W.

Washington, D.C. 20036

(202) 296-5700

For the Virginia Surface Mining

and Reclamation Assn., and the

Town of Wise, Virginia

MARSHALL COLEMAN

Attorney General

ROGER L. CHAFFE

Assistant Attorney General

Grecory M. LUCE

Assistant Attorney General

Commonwealth of Virginia

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TABLE OF CONTENTS

Appellees’ Counterstatement ...............cccccccccsceeeee

Summary of Argument ............cccccccsccessescescceeceeees

Argument:

I. Because Title V of the Federal Act Pur-

ports to Regulate, Under the Guise of

the Commerce Clause, Land Use

Functions Within The Recognized

Scope Of The Police Powers Of The

Commonwealth of Virginia, It Involves

An Unconstitutional Assumption Of

Authority Not Granted To The Feder-

bag, RR TRE NER GPS oA i

A. Diminution of the Utility of Land As

a Basis for Federal Commerce

PROUIRIINNOUD ccs cadstnahcatertetnccicewbsis ckte

B. Floods and Water Pollution...............

II. The District Court Correctly Held That

Title V Of The Federal Surface Mining

Act Preempts Reserved Powers Of The

States In Contravention Of The Tenth

PERI ccncccsicuntcotiniendanc.

A. The Act Displaces Virginia’s Free-

dom To Structure Integral Oper-

ations In Areas of Traditional

Governmental Functions ...............

1. The Act Impermissibly Removes

State Discretionary Authority

Over Land Use Planning and

Control of Surface Mining.......

2. The Act Displaces State Policy

Regarding Land Use Planning

and Control Which Has

Traditionally Been A Func-

tion Of State And Local Gov-

CORIO fait ie

ill

TABLE OF AUTHORITIES

Page

CASES

Andrus v. Allard, 444 U.S. 51 (1979)... 45,50

Berman v. Parker, 348 U.S. 26 (1954)...0..0..... 30

Brown v. EPA, 521 F.2d 827 (9th Cir. 1975). 27

City of Euclid v. Ambler Realty Co., 272 U.S.

ET ERIE LAA Te et 30

Coyle v. Oklahoma, 221 U.S. 559, 580............ 42

District of Columbia v. Train, 521 F.2d 971

SS ISIS ESS a OO eS OO 25,26,35

Duke Power Company v. Carolina

Environmental Study Group, 438, U.S. 59

Ne scoenoccaene 50

Ewing v. Mytinger & Casselberry, Inc., 339

END ois cs scesanraasivssencacsecseosess 53,54

Federal Power Commission v. Oregon, 349

DD pions csscvessvasiakaccccceceovenceseacses 20

Friends of the Earth v. Carey, 552 F.2d 25

Te csc cndsislanevepdesveseseeecaves 27,35

Fry v. United States, 421 U.S. 542 (1975)... 27,33

Fuentes v. Shevin, 407 U.S. 67 (1972)... 57

Gibbons v. Ogden, 9 Wheat. 1 (1824)............ 17

Goldberg v. Kelly, 397 U.S. 254 (1970) ......... 55

Goldblatt v. Hempstead, 369 U.S. 590

il sss cscnpstincvesescéendnoespecsevee 45,46,49

Hadacheck v. Sebastian, 239 U.S. 394

Ne casdulinnoses 45,49

Hampton v. Mow Sun Wong, 426 US. 88

SES EE 47

Heart of Atlanta Motel v. United States, 379

isos ciceatinsbucesessennvensessors 17

Indiana v. Andrus, Nos. IP78-500-C and

IP78-501-C (S.D. Ind. June 10, 1980)........ 58

PREVIOUS PAGE WAS BLANK

’

Page

Ivanhoe Irrigation District v. McCracken, 357

RR UE a Ee EB vcsucahshici coin cease tcapaibebebdeiven cess 20

Joint Anti-Fascist Comm. v. McGrath, 341

BE Re BOE D cccchachbreonieigubbaiessaalscmieaaseock 54

Kaiser Aetna v. United States, 444 U.S. 164

FCG Bi cévassesavcerataeasiatcobusdtdiiicln ah inaitbckemein 45,47,50

Kansas v. Colorado, 206 U.S. 46 (1906)......... 18,19

Katzenbach v. McClung, 379 U.S. 294

6 PES ciicsiessstvetictcociabcladoadbicbddatidsaieaiacwiesce 16

Kelley v. Southern Pacific Co.. 419 U.S. 318

BS FPR es SAE ECE SPENT I eR 40

Kleppe v. New Mexico, 426 U.S. 529 (1976). 20

Lane County v. Oregon, 7 Wall. 71, 76............ 42

Mathews v. Eldridge, 424 U.S. 319 (1976).... 54,55,

56,57

McCready v. Virginia, 94 U.S. 391, 396.......... 18

Metcalf & Eddy v. Mitchell, 269 U.S. 514

ERPS aacicealh coh ai lene sition cialis tusks wicanleia nseyess 28

Miller v. Schoene, 276 U.S. 272 (1928 ).......... 49

Mitchell v. W.T. Grant Co., 416 U.S. 600

OA POD sails sb setedscmcdeemten eset aviadacbatoccedinys <ehedianiaas 56

Montrym v. Panora, 429 F.Supp. 393

GEM, B59 F Wiss saktisescdbtaceeccessnstecttavaas acs 57

Moore v. City of East Cleveland, 431 U.S.

re 0 re FP ei aivicideaaectn chain bavaenebices 49

Moore v. Hampton Roads Sanitation Com-

mission, 577 F.2d 1030, 1038 (4th Cir.

Set P We chici sts hiutitilc ic eaininabeasa eaiabalnddeblentowes\iscids 18

National League of Cities v. Usery, 426 U:S.

a EAPO ET nde csatanhi rbedtieekderdtiadcdisicesdaldaioe 7,25,26,

28,29

30,31,

Penn Central Transportation Co. v. City of

New York, 438 U.S. 104 (1978) wo...

Pennsylvania Coal Co. v. Mahon, 260 U.S.

BE TE Eee Barris aco on dinicicac aay cdc cdcasecesss

Pierce Oil Corporation v. City of Hope, 248

NE MEE RE OTD Wladicesstacnsticsncisbthghslietiasusices

R.A. Holhman and Co. v. SEC, 299 F.2d 127

eee Cir. 1962) cert. denied, 370 U.S. 911

Kj) PROBA CANS HE FO MOREE Oe

REF sinesacenabieriteiateaadbibelactubercauianniuaeoine.

Sierra Club v. EPA, 540 F.2d 1114, (D.C.

SE GRAMS PERD MiSn Notes Sa een Se Re CR eae

Sink v. Morton, 529 F.2d 601 (4th Cir. 1975)

Stanley v. Illinois, 405 U.S. 646 (1972) ..00......

Star Coal Co. v. Andrus, No. 79-171-2 (S.D.

NI Ss By BOI Pica clscc seicdcsvessecicussmensaseseass

Stypmann v. City and County of San Fran-

cisco, 577 F.2d 1338 (9th Cir. 1977)...........

Tollage Creek Elkhorn Mining Co. v. OSM,

IBSMA 80-32, November 24, 1980 .............

United States v. Arizona, 295 U.S. 174

5 BARS ECE MRET RAO GROEN? EPs eee a PR

Di.) BREMEN iar ore were ce tn ROMs COE Re

United States v. Cress, 243 U.S. 316 (1917) ..

United States v. Darby, 312 U.S. 100, 115

EL 0b PAR eats Una Ars cael ORC aco

EIT AD witstin sa caked polenenleninahika tinsasasisinabeabosonas

United States v. San Francisco, 310 U.S. 19,

nets POE OED bi kis sccdinntaeciundieciocspisotas

Page

45,47,

48,50

45,46,

50,56

Page

United States v. U.S. Gypsum Co., 333 USS.

S06, STs CPOE ook a ate 40

United States v. Vertol, 545 F.2d 648, 651

i ' $e AB bY, f unborn eel neowece aren SAW SE RA 57

Village of Belle Terre v. Boraas, 416 U.S. 1

CES PD ickklsscesscbiiieocins cepalendanesaeneatmdanes 30

Vlandis v. Klein, 412 U.S. 441 (1973) ........... 57

Warth v. Seldin, 422 U.S. 490, 508 n.18

C BSF D cccicscndickcccbiassdnasiaeehtaasbaatiink died 30

UNITED STATES CONSITUTION

Article I, Section 8, Clause 3, Commerce

ROT IOI NE ETS atte ot = BIER 9,11,12,

13,17,

20,21,

Article IV, Section 3, Clause 2, Property

a a ee 18,19,

20,21

Paes PRM ii ie a 8,11,50,

51,52,

TORT AGRE oi ii i cee. 10,25,

26,28,

29,30,

STATUTES AND RULES

Clean Air Act, 42 U.S.C. 1857, et seq.............. 10,13,

26,27,

33,34

Federal Coal Mine Health and Safety Act of

1969, 30 U.S.C. Section 801 et seq............... 56

Vili

Federal Surface Mining Control and Recla-

mation Act of 1977, 30 U.S.C. §1201 et

seq:

eee By NO BOLE) coi siccsscccancctsesicasess

I i

Ss) ta IE a ea eee

BORUe W, CeO AE i i acces

I sc anata. a cnsasaciorddansbaue nce

NN isis cies cenicniacssincliosasedenadiacenxes

_ AE ERA SRP RE IA A

NE I elites hn. dconsdcihtcnauvacacenddscéucins

as A og ER PL ER Ue

ON aia cctuciatuads,

MND he Wich hair eked cnt /seceeois dosdocooccas

ee Ek 2 ee Ona nA

eR REE RAT STR SERNA CE

Federal Water Pollution Control Act of 1972.

Pe WE a Mice BEE FE OM icechstlededccsnervnecsactens

Flood Control Act of 1944, 33 U.S.C. §701 et

ESSE Ss NS LAER ARE Cee ie

te CANE Ere Weare Ran rE AENON LAS SO CAT Owe

Occupational Safety and Health Act, 29

Pagal PD EIN chi fale ers eutcdlascocsc sd nasi sas!

PUREE ACt, 26 UBC. F1AGE cocci cicccicccgescdecaiscss

Federal Rules of Civil Procedure, Rule 52. 28

SIRES eee ek ea ae acer

Page

Vill

TEXTS AND ARTICLES

Congressional Record, January 18, 1973,

EOE S| EET CAD MSE CRI Ae TOO

Sen. Rep. No: 92-1162, 2d Session, p.62 .........

Engdahl, Some Observations on State and

Federal Control of Natural Resources,

(1978) 15 Houston Law Review 1201,

PET civcnbactgniaeccscdeche anastasia cassia caaainanleas

Stewart, Pyramids of Sacrifice; Problems of

Federalism in Mandating State Implemen-

tation of National Environmental Policy,

(1977) Yale Law Journal 1196 ...................

Page

Nos. 79-1538 and 79-1596

IN THE

Supreme Court of the United States

OCTOBER TERM, 1980

Ceci, D. ANDRUS, SECRETARY OF THE INTERIOR,

Appellant,

VIRGINIA SURFACE MINING AND RECLAMATION

ASSOCIATION, INC., ET AL.

VIRGINIA SURFACE MINING AND RECLAMATION

ASSOCIATION, INC., ET AL.,

Appellants,

CrEcIL D. ANDRUS, SECRETARY OF THE INTERIOR

On Appeals From The United States District

Court For The Western District of Virginia

BRIEF FOR THE VIRGINIA SURFACE MINING

AND RECLAMATION ASSOCIATION, INC.,

THE TOWN OF WISE, VIRGINIA, AND

THE COMMONWEALTH OF VIRGINIA

Appellees’ Counterstatement

The statement of the case set forth in the Secre-

tary’s brief is accurate insofar as it describes the

procedural history of this case. It fails, however, to

describe the factual background necessary for a full

understanding of the case. Appellees believe that the

factual summary set forth below will facilitate the

Court’s consideration of the legal issues presented.

Bituminous coal, which is Virginia’s most valu-

able natural resource, is found in the seven west-

ernmost counties of the State, a region of mountainous

terrain with very limited level land area. The topog-

raphy of much of the region is marked by steep

mountain slopes with sharp ridges, massive outcrops of

rock, and narrow valleys which severely limit devel-

opment of the land for any economic use. Because of

thin soils and steep terrain these mountain lands in

their natural state are not suited for forestry operations

or for agricultural use. Their value lies solely in the

underlying coal seams which appear as outcroppings

at various elevations on the mountain slopes. With

few exceptions these coal seams cannot be recovered

by underground mining for reasons related to their

limited thickness, inadequate roof support provided by.

the overlying shale strata, and other geologic factors.

Accordingly, unless they are removed by surface min-

ing methods these valuable coal reserves, estimated as

300 million tons, are unrecoverable.

Coal mining is the major industrial activity in

southwestern Virginia, and provides the economic

lifeblood of the communities and people of the region.

Because the economy of the region is so heavily

dependent on coal mining it is particularly affected by

cyclical changes in the coal market and recurrent

periods of unemployment and depression, a problem

which has been a major concern of State and local

officials for many years. Accordingly, State officials

have recognized the urgent need for diversification of

industry in order to establish a broader economic base

and alternative sources of employment for the citizens

of the area in the future, but such diversification is

greatly inhibited by the rugged terrain conditions, and

especially by the almost total lack of level land areas

for industrial development, for housing and trans-

portation facilities, and related support facilities.’ Ac-

cordingly, a very important long range benefit to the

communities in Southwestern Virginia is the potential

for creating additional areas of level land by post-

mining reclamation of surface mined areas. In recent

years reclaimed surface mine areas have provided

appropriate sites for airports, schools, hospitals, shop-

ping centers, industrial parks and residential housing,

and it has been the policy of the State Division of

Mined Land Reclamation to encourage continued

development of additional level land areas consistent

with practical environmental considerations.

For several years prior to enactment of the Feder-

al Surface Mining Act the Commonwealth of Virginia

administered and enforced State programs regulating

the use of land for surface coal mining. In 1966 the

Virginia General Assembly adopted the Virginia Coal

Surface Mining Law which required State approval of

' See testimony of Governor John N. Dalton, Tr.2798-2800; Fred

W. Walker, Director, Department of Conservation and Economic

Development, Tr.72-76; Congressman William C. Wampler, Tr.2468-

2472.

mining plans and posting of reclamation bonds as a

condition of the issuance of permits for surface mining,

and in 1972 the law was amended to strengthen

inspection and enforcement action by the Division of

Mined Land Reclamation.’

In 1975 a Technical Committee was appointed to

draft regulations designed to incorporate the best

available surface mining technology consistent with

the terrain and other geophysical conditions existing in

Virginia. In developing such regulations the Technical

Committee reviewed and appraised the regulations

and statutes of other Appalachian coal producing

States, as well as various technical engineering studies

and reports prepared for federal agencies, including

the Environmental Protection Agency. As a result of

eighteen months of study the Virginia Reclamation

Manual was adopted by the Board of Conservation

and Economic Development on May 12, 1977, to

become effective on September 1, 1977 as to all surface

mining operations initiated after that date. (Testi-

mony of J. Steven Griles, Tr.88-90 ).

Between the date of the adoption of the Virginia

Reclamation Manual and its effective date of Septem-

ber 1, 1977, the Federal Surface Mining Control and

Reclamation Act was signed into law on August 3,

1977 to become effective May 3, 1978. Because the

Federal Act preempts all State laws and regulations

not in conformity with the Act, the Virginia Reclama-

tion Manual was effectively superseded by the Federal

Act.°

2 Chapter 15 of Title 45, Code of Virginia.

3€ection 504 of the Act directs the Secretary of the Interior to

promulgate and enforce a federal program for any State which fails to

(footnote continues)

Although the environmental standards of the

Virginia Reclamation Manual substantially parallel

those of the Federal Act there is a significant difference

in their approach to reclamation problems. The State

regulations recognize that there are varying site-

specific conditions found at any particular mining

operation, and allow State authorities to approve

reclamation practices which are best suited to deal

with such conditions, whereas the Federal Act imposes

inflexible, mandatory criteria to be applied in all

situations without exception. The most critical ex-

ample of this is found in section 515(d) of the Act

which calls for returning all steep slope areas to

approximate original contour, with all highwalls com-

pletely covered.‘ In contrast, the Virginia Reclamation

Manual allows the mined area to be restored to a more

level contour suitable for a better and more practical

use than if restored to its original steep slope contour.

This permits regrading and compaction of overburden

materia! on the mining bench with appropriate drain-

age structures to prevent erosion and sediment runoff.

The level area may then be used for cropland, grazing,

tree farming and other agricultural uses, or, in more

populated areas, for housing facilities and numerous

other purposes. If restored to their approximate

original contour as required by the Federal Act the

steep mountain slopes have no utility for any purposes,

(footnote continued)

adopt a State program incorporating provisions no less stringent than

those contained in the Federal Act, and “[ A ]ny statutes or regulations

of such State which are in effect to regulate surface mining and

reclamation operations shall. ..be preempted and superceded by the

Federal program.” §504(g), emphasis added.

4The Federal Act defines a steep slope as any slope above

twenty degrees. §515(d)(4).

and any economic value the land would otherwise

have is virtually destroyed.®

The trial evidence established, and the district

court found, that ninety-five percent of surface mine-

able coal in Virginia is situated on steep slope terrain

having an average slope angle of 25 degrees. J.S. App.

96a. The Court expressly found on the basis of the

extensive trial evidence that compliance with the Act’s

requirement for returning the steep mountain slopes of

Virginia to original contour after surface mining “‘is

economically unfeasible and physically impossible.”

JS. App. 37a. The court further concluded from the

expert engineering testimony that a return to original

contour on steep slopes is environmentally unsound

and may cause far greater environmental damage than

the alternative procedures called for in the Virginia

Reclamation Manual. The court specifically found

that:

“A return to approximate original contour on a

steep slope increases sedimentation because of the

increased erosion from the unstable mass. In

addition a dangerous condition may be created by

backfilling the bench. When overburden material

is stacked up against the highwall the normal

process of settlement of the fill material tends to

pull it away from the highwall. This provides a

natural channel for water from the upper slope to

flow down to the bench below, creating an un-

stable mass with a likelihood of eventual col-

lapse.” J.S. App. 39a.

After synthesizing the cumulative effect of the

trial evidence the district court found that because the

Federal Act has preempted State regulation of surface

5 See, District Court Memorandum Opinion, J.S. App.5éa.

mining “the State has lost control over the economic

development that could take place in southwest Vir-

ginia,” and “is now in the position of enforcing an Act

so particularly unsuited to its terrain that compliance

with its provisions has a_ higher potential for

environmental harm than alternative procedures.” J.S.

App. 36a, 39a.° For these reasons the court concluded

that the Act operates to “displace the States’ freedom

to structure integral operations in areas of traditional

governmental functions, National League of Cities v.

Usery, 426 U.S. at 852, and, therefore, is in con-

travention of the Tenth Amendment.” J.S. App. 39a-

40a.

The district court further found, on the basis of

the trial evidence, that

“The requirement of return to original contour

amounts to a physical restriction on the removal

of coal. The landowner cannot remove his coal

because it is economically and physically impos-

sible to comply with the steep slope reclamation

provisions of the Act. Because of the nature of the

land, the owner is thereby deprived of any use of

his land, not only the most profitable use. Moun-

tainous terrain is unusable for all income produc-

ing activities unless it is level, which the Act is

aimed at preventing.” J.S. App. 55a, 56a.

The court noted further that “The fact that

property owners are being deprived of the use of their

land by a statute that does not accomplish its purpose,

nay, may even run contrary to it, tips the balance

toward finding a taking.” Accordingly, the court held

6 Citing studies sponsored by federal government agencies, in-

cluding the EPA and the Bureau of Mines. J.S. App.39a, n.17.

that the Act’s requirement that steep slopes be restored

to approximate original contour constitutes a taking of

property without just compensation in violation of the

Fifth Amendment. J.S. App. 56a.

The district court also determined that the provi-

sions of section 521 of the Feaeral Act which empower

federal inspectors to summarily order cessation of

mining operations without a prior hearing or showing

of proper cause create a grave potential for abuse, and

give rise to violations of the procedural due process

guarantees of the Fifth Amendment. In support of this

conclusion the court cited a number of examples,

developed through evidence at the trial, where OSM

inspectors issued unjustified and unwarranted cessa-

tion orders which were subsequently vacated after

formal hearings on grounds that they were improperly

issued. During the time such invalid cessation orders

remained in effect the mine operators lost thousands of

tons of coal, hundreds of miners were out of work, and

the operators were compelled to incur great expense in

engineering and attorney’s fees in appealing the cessa-

tion orders.

Similarly, the court held that the civil penalty

provisions of section 518 do not accord with due

process because they call for mandatory assessment of

penalties by the Secretary against a mine operator in

amounts up to $150,000 without a hearing of any

kind, and provide that unless an operator pays the

assessed penalty, prior to any hearing, he waives aii

legal rights to contest the alleged violation or penalty

amount. J.S. App. 68a, 69a.’

In light of these findings the court enjoined the

issuance of summary cessation orders under section

521, and civil penalties under section 518, until such

time as adequate due process guarantees are afforded

to mine operators. J.S. App. 73a, 74a.

SUMMARY OF ARGUMENT

Title V of the Surface Mining Act creates a

preemptive program of federal regulatory controls af-

fecting land use and land reclamation, and thrusts the

iederal government for the first time into a sphere of

regulatory activity which has heretofore been regarded

as exclusively within the jurisdiction of the States and

their political subdivisions. By imposing federal con-

trols upon land use for surface mining, and dictating

criteria for reclamation of land areas after mining has

ceased, the Act transfers to a federal agency the time-

honored land use powers of State and local govern-

ments and creates a body of federal police powers

designed to supplant the inherent Police powers of the

States to provide for the protection of the individual

citizen in his person as well as in his property rights.

This in turn raises a serious constitutional ques-

tion as to whether the power granted to Congress

under the Commerce Clause extends to regulation of

7 Section 518(c) provides that if a person wishes to contest either

the amount of a penalty or the fact of the alleged violation he must

first forward the penalty amount to the Secretary for placement in an

escrow account, and “Failure to forward the money to the Secretary

within thirty days shall result in a waiver of all legal rights to contest

the violation or the amount of the penalty.”

private non-federal lands within a State. The prior

decisions of this Court indicate that it does not, and

there are no legal precedents to support exercise of

federal powers in this field.

In addition, serious questions are presented as to

whether the means selected by Congress in this in-

stance are appropriately designed to achieve the legis-

lative objective of protecting the quality of land re-

sources and preventing environmental damage. The

overwhelming weight of the trial evidence supports the

district court’s finding that the Act’s requirement for

restoring steep slope mountain terrain to approximate

original contour is environmentally unsound, and pre-

vents reclamation of unproductive mountain slope

land to a higher level of productive use compatible

with the needs of the local communities and their

people.

Because it denies toa State the discretionary

authority to determine the best and highest use of its

lands, and the orderly development of its natural

resources, Title V unconstitutionally intrudes upon

sovereign powers reserved to the States under the

Tenth Amendment. Existing environmental protec-

tion programs under the Clean Air Act and the Water

Pollution Control Act are fully capable of achieving

the desired objectives without the excessive intrusion

upon State land use functions brought about by the

Surface Mining Act.

The district court correctly held that because the

inflexible requirements of Title V as applied to mining

on steep mountain terrain amount to a physical restric-

tion on removal of coal, with a consequent destruction

of the economic value of the land, the Act effectuates a

taking of property without just compensation in viola-

tion of the Fifth Amendment.

The trial court also correctly concluded that sum-

mary issuance of cessation orders by federal mine

inspectors without a hearing or showing of proper

cause, and the issuance of civil penalty assessments

under the procedures sanctioned by the Act, result in a

denial of procedural due process contrary to the guar-

antees of the Fifth Amendment.

ARGUMENT

BECAUSE TITLE V OF THE FEDERAL ACT

PURPORTS TO REGULATE, UNDER THE

GUISE OF THE COMMERCE CLAUSE, LAND

USE FUNCTIONS WITHIN THE RECOGNIZED

SCOPE OF THE POLICE POWERS OF THE

COMMONWEALTH OF VIRGINIA,

IT INVOLVES

AN UNCONSTITUTIONAL ASSUMPTION

OF AUTHORITY NOT GRANTED

TO THE FEDERAL GOVERNMENT

In considering the question of whether Title V of

the Act represents a valid exercise of the powers of

Congress under the Commerce Clause the district court

concluded that it must defer to the congressional

finding in section 101(f) of the Act that surface coal

mining has adverse effects on commerce, and that “A

court may neither examine the motive or purpose

behind the legislation, United States v. Darby, 312

U.S. 100, 115 (1941), nor substitute its own judg-

ement for that of the Congress.”

Appellees acknowledge that the district court cor-

rectly stated the rule laid down by this Court in the

cited cases, but contend that the rule is not applicable

where, as here, the subject of attempted federal regu-

jation is by its very nature beyond the scope of the

commerce power. At the heart of this case is the

question of whether laud as such is subject to regu-

lation under the Commerce Clause, i.e. whether land

can be regarded as “in commerce.” As appellees will

show, the principal focus and thrust of the Federal

Surface Mining Act is regulation of the use of private

non-federal lands within the borders of the respective

States, and has little or nothing to do with the

commerce aspects of extraction, transportation and

sale of surface mined coal. As early as 1972 when the

Senate was considering S.630, the Department of the

Interior advised its sponsor, Senator Jackson, that

“The environmental problems stemming from mining

operations are essentially land use problems. Such

problems are, under the Federal Constitution, primar-

ily the responsibility of the States.” ®° S.425 which was

passed in the 93rd Congress was also sponsored by

Senator Jackson who commented on the Senate floor

that:

“Surface mining is a form of land use and its

regulation and control must be considered within

the context of the broad demands and competing

requirements upon the State’s land resources. In

a constitutional sense, the primary authority and

responsibility for the control of surface mining

resides in the State.” ®

8S.Rept. 92-1162, 92d Cong., 2d Session, p.62.

9 Cong. Rec. January 18, 1973, p.S.834.

Despite this acknowledgement that the surface

mining legislation involved regulation of land use, and

that constitutional authority for control of surface

mining resides in the States, Congress proceeded to

adopt the Act as a comprehensive scheme of federal

controls preempting State power to permit land use for

surface coal mining in any manner other than as

dictated by the federal government.

Although the power of the federal government to

adopt and enforce environmental laws dealing with air

and water resources '° has been recognized as a valid

exercise of the commerce power, (cf. cases cited infra),

it does not follow that a parallel case can be made for

federal regulation of private land. Air is an element

common to all States, and its contamination within a

State can have effects beyond that State’s borders in

what has been termed a “spillover effect.” '' On

similar grounds, there is a demonstrable federal inter-

est in the environmental protection of navigable wa-

ters and their tributaries. But no comparable grounds

exist for the assertion of a federal interest sufficient to

justify the regulation of private lands, as land, within a

State. Hence, in the Surface Mining Act Congress has

assumed the authority, without a rational basis under

the Commerce Clause, to impose federal environmen-

tal standards on private lands so as to restrict their use

for surface coal mining.

The Secretary’s argument (Brief, p.24) that the

regulatory scheme of Title V is primarily concerned

10 The Clean Air Act, 42 USC 1857 et seq., The Federal Water

Pollution Control Act 33 USC 1251 et seq.

11 See, Stewart, Pyramids of Sacrifice; Problems of Federalism in

Mandating State Implementation of National Environmental Policy:

86 Yale Law Journal 1196 (1977).

with “operations involved in extraction of surface

mined coal,” rather than control of land use, is

deceptive and misleading, and is contrary to the

express finding of the district court. The court found

that the direct regulatory impact of Title V is upon

land use, and “While the Act ultimately affects the

coal mine operator, its pervasive effect is on the States’

legislative authority and on State control of land

within its boundaries.” J.S. App. 32a.

Although the Secretary now contends that the Act

does not regulate land, this contention is directly at

odds with the position the Interior Department and its

officials have heretofore taken. For example, in The

Land Use Restoration Provisions of the Surface Mining

Control and Reclamation Act: Constitutional Consid-

erations," the Associate Solicitor for the Office of

Surface Mining has unabashedly described the Act as

establishing land use controls. William M. Eichbaum,

in collaboration with David T. Buente, an attorney in

the Division of Lands and Natural Resources, Depart-

ment of Justice, discusses the regulatory scheme of the

Act and describes the steps the Office of Surface

Mining has taken to implement its “land-use control

standards.” Jd. 229. The authors note that in the

interim phase OSM established criteria for assessing

pre-mining use of the land, which “defined eleven

separate ‘land-use’ categories,” Jd. 229,230, and that

“the permanent program includes complex permitting

requirements that relate to land-use-control.” Jd. 233.

See also, fn. 8, supra.

An examination of Title V proves beyond doubt

that its objective is to dictate the conditions under

'2 4 Harvard Environmental Law Review 227 (1980)

which a State may authorize the use of lands for

surface mining, and the procedures and land use

criteria which a State must apply in considering and

approving applications for permits. §§ 506, 507.

Under its terms a State cannot issue a permit for any

land use for coal surface mining without first acquiring

data on the history of the land use which preceded the

proposed mining, the capability of the land prior to

mining to support a variety of uses, the productivity of

the land prior to mining, the use which is proposed to

be made of the land following reclamation, the capa-

city of the post-mining reclaimed land to support a

variety of alternate uses and the relationship of such

uses to existing land use policies and plans, the

manner in which proposed post-mining land use is to

be achieved, and the necessary support activities

which may be required to achieve the post-mining

land use. §508. A State must also require a

performance bond in an amount sufficient to assure

post-mining reclamation of the land to approximate

original contour, and assure compliance with proposed

post-mining land use. § 509. Other provisions of Title

V prohibit surface coal mining on various categories of

lands, and require that a State desiring to retain any

enforcement authority under the Act must establish a

planning process for designating additional land areas

as unsuitable for mining in accordance with the speci-

fied criteria of the Act. § 522.

After reviewing these preemptive restrictions on

the authority of the States to permit use of lands for

surface coal mining the district court correctly found

that the Act’s “pervasive effect is upon the States’

legislative authority and on State control of land use

within its boundaries.” J.S. App. 32a.

A. Diminution of the Utility of Land as a Basis for

Federal Commerce Regulation.

The predicate for the regulatory scheme of the Act

is contained in the finding in section 101(c) that

surface mining affects commerce, inter alia, by “‘dimin-

ishing the utility of land for commercial, industrial,

residential, recreational, agricultural and forestry pur-

poses ....” The overwhelming weight of the trial

evidence in this case proves, however, that surface coal

mining enhances rather than diminishes the utility of

Virginia’s mountain slope land for commercial, indus-

trial, residential, agricultural and forestry purposes. In

its Memorandum Opinion the district court enumer-

ated the various purposes for which mined lands have

been and can be used when reclaimed to a level state,

and the high premium placed on the value of such

level lands. If restored to original contour, the court

found, mountain slope land has no practical economic

value or use. J.S. App.37a."*

The Secretary nevertheless insists that the courts

must defer to Congress’ finding and “‘the only remain-

ing question for judicial consideration is whether the

means selected by Congress for the regulation of

commerce are rational.” Brief, p.24, citing Katzenbach

v. McClung, 379 U.S. 294 (1964). This argument

again sidesteps the real issue of whether regulation of

land is regulation of commerce. If Congress has no

'3 The court relied on evidence that steep slope land without coal

has only a nominal value of five dollars to seventy-five dollars an acre,

but coal lands which are left in a level state after mining are worth a

minimum of five thousand dollars an acre, and some reclaimed lands

may bring as much as three hundred thousand dollars an acre. The

court noted that “If restored to its original contour, its worth reverts to

the lower values.” Id.

power to regulate non-federal lands within a State it

cannot create that power simply by making a finding

that the use of such lands adversely affects interstate

commerce.

It would seem obvious that the rule of deference

to Congressional findings cannot foreclose scrutiny into

the premise on which such findings are based. If a

finding that diminution of the utility of land is

sufficient grounds for exercise of the commerce power

in the Surface Mining Act it follows that Congress can

bring any and all land use activities within the

regulatory control of the federal government by a

similar “finding.”

Although the Secretary’s brief is generously fla-

vored with citations to commerce clause cases ranging

from Gibbons v. Ogden, 9 Wheat. | (1824) to Heart of

Atlanta Motel v. United States, 379 U.S. 241 (1964),

it is important to note that none of the cited cases deal

with the question of whether the federal commerce

power extends to regulation of non-federal lands with-

in the borders of the individual States.

The actual fact is that this Court has never held,

nor even intimated, that land as such is subject to

regulation under the Commerce Clause. Indeed, in the

relatively few cases in which the issue has been even

touched upon the Court unequivocally rejected this

notion. As jong ago as 1877 the Court noted in

14 As one commentator puts it “The Act relies upen what can be

called the ‘hocus pocus’ theory of federal power by incantations in the

form of conclusory generalizations of efects upon commerce, as if this

magically creates a general fedcral police power.” Engdahl, Some

Observations on State.and Federal Control of Natural Resources, 15

Houston Law Review 1201, 1218.

straightforward language that “Commerce has nothing

to do with land while producing, but only with the

product after it has become the subject of trade.”

McCready v. Virginia, 94 U.S. 391, 396. Emphasis

added. The cases since McCready provide no support

for any contrary conclusion, and the quoted language

from McCready continues to be cited by the courts as

controlling Jaw. See, e.g., Moore v. Hampton Roads

Sanitation Commission, 577 F.2d 1030, 1038 (4th Cir.

1977).

Although in the intervening years since McCready

the federal commerce power has been broadly con-

strued to cover local activities affecting commerce, it

has never been extended to land use regulation, and

the courts have uniformly held that federal powers in

respect to regulating land are limited to those derived

from the Property Clause of Article 4, Section 3,

Clause 2 of the Constitution, i.e. legislative powers

over federally owned land.'* In Kansas v. Colorado,

206 U.S. 46 (1906), the State of Kansas sought to

restrain Colorado from diverting the waters of the

Arkansas River for reclamation of arid lands within

Colorado. The United States intervened in the action

asserting that the right of either Colorado or Kansas to

appropriate the waters of the river for reclamation

purposes was subject to the superior authority and

supervisory control of the United States to control the

whole system of reclamation of arid lands. The Court

noted that the issue raised by the government’s

5“*The Congress shall have Power to dispose of and make all

needful Rules and Regulations respecting the Territory or other

Property belonging to the United States; and nothing in this Con-

stitution shall be construed as to Prejudice any Claims of the United

States, or of any particular State.”

claim“... involves the question whether the reclama-

tion of arid lands is one of the powers granted to the

general government,’ and went on to hold that the

only authority of the federal government to deal with

reclamation of land derives from the Property Clause,

which

“... does not grant to Congress any legislative

control over the states, and must, so far as they

are concerned, be limited to authority over the

property belonging to the United States within

their limits....The proposition that there are

legislative powers affecting the nation as a whole

which belong to, although not expressed in, the

grant of powers, is in direct conflict with the

doctrine that this is a government of enumerated

powers ... This natural construction of the

original body of the Constitution is made abso-

lutely certain by the 10th Amendment. This

Amendment, which was seemingly adopted with

prescience of just such a contention as the present,

disclosed the widespread fear that the national

government might under the pressure of a sup-

posed general welfare, attempt to exercise powers

which had not been granted.” 206 U.S. at 87-89.

The Court held, accordingly, that the respective rights

of the States of Kansas and Colorado were not

subordinate to any supposed superior right on the part

of the federal government to provide for reclamation of

lands, other than federal lands, within the States.

The principles expressed by the Court in Kansas

v. Colorado have been followed in subsequent deci-

sions, and remain the applicable law to the present

time. In United States v. Arizona, 295 U.S. 174

(1935), the Court held that the federal reclamation

laws providing for irrigation of arid lands did not

involve an exercise of the commerce power, “but in the

exertion of power granted by Article 4, section 3,

clause 2.” 295 U.S. at 184. A similar view was

expressed by the Court in Jvanhoe Irrigation District v.

McCracken, 357 U.S. 275 (1958) involving federal

reclamation projects in California.

In Federal Power Commission v. Oregon, 349 U.S.

435 (1955) the State of Oregon sought to set aside a

license issued by the FPC for a power project to use

non-navigable waters located on a federal reservation

in Oregon. The question presented was whether the

State had exclusive control over the use of non-

navigable waters within the State. The Court noted

that the authority of the: FPC to issue licenses in

relation to navigable waters springs from the Com-

merce Clause, and that where non-navigable waters

are involved the Commission’s authority to issue li-

censes hinges upon whether the project is located on

federally owned lands and reservations. The Court

held that since in the case before it the power project,

and the non-navigable stream, were located on a

federal reservation the FPC had authority under the

Property Clause of the Constitution to issue the license.

The clear implication of the Court’s holding is that had

the project been located on private or state owned

lands the federal agency would have no regulatory

powers respecting it.

Kleppe v. New Mexico, 426 U.S. 529 (1976),

involved the constitutionality of a statute enacted by

Congress in 1971 to protect wild horses and burros on

public lands of the United States. The State of New

Mexico asserted that the federal government lacked

power to legislate with respect to wild animals unless

the animals were moving in interstate commerce or

damaging the public lands, and that the State alone

had authority in respect to control of these animals. A

three-judge federal court agreed with the State that the

Act could not be sustained under the Commerce

Clause, but upon appeal this Court upheld the Act on

grounds that under the Property Clause the federal

government has power over its own property analo-

gous to the police power of the several states, and can

properly regulate to protect the wildlife living there.

At the same time, the Court noted, the Property Clause

does not authorize “an exercise of a general control

over public policy in a State,” but only “an exercise of

the complete power which Congress has over particu-

lar public property entrusted to it” 426 USS. at 540,

citing United States v. San Francisco, 310 U.S. 19. 84

L.Ed. 1050 (1940).

The common legal premise in all of the cited cases

is that the enumerated powers of the federal govern-

ment under Article I of the Constitution do not include

regulation of lands other than federal lands, and there

is no judicial authority or precedent for the Secretary’s

contention that shipment of extractive minerals in

interstate commerce gives rise to federal regulatory

powers to dictate to the States how private lands

within their jurisdiction may be used.

B. Floods and Water Pollution

The alternative ground upon which the Secretary

defends the preemptive scheme of the Act is that

Congress found in section 101(c) that surface mining

adversely affects commerce by contributing to floods

and water pollution. The apparent rationale for this

argument is that because federal commerce jurisdiction

includes navigable waters it must also include jurisdic-

tion over any watershed areas from which rainwater

runoff flows into navigable waters or their tributaries."®

If this premise is carried to its logical conclusion

there must be deemed to be a federal commerce

interest in every square foot of land which receives

rainfall or storm precipitation. In such a context there

could be no limits whatever to the federal commerce

power, and State control of land use would for all

practical purposes be a dead letter.

While it is unquestioned that the federal com-

merce power extends to maintaining and improving

the navigable waters of the United States, and pre-

venting obstructions to navigation, federai jurisdiction

over navigable waters does not carry with it the power

to regulate lands which drain into navigable waters.

“This power to regulate navigation confers upon the

United States a dominant servitude which extends to

the entire stream and the stream bed below the

ordinary high water mark... but does not extend

beyond the high water mark.” United States v. Rands,

389 U.S. 121, 123 (1967), emphasis added.

Construction of flood control dams and structures

is carried out under the Flood Control Act of 1944, 33

USC 701, which expressly states in its Declaration of

Policy (section 701-1) that

16 The evidence presented at the trial showed that surface coal

mining in Virginia has a minimal effect on stream sedimentation, and

that mining on steep slopes has the effect of interrupting and holding

heavy flows of rainwater which would otherwise increase flooding in

the valleys below. See district court Memorandum Opinion, J.S.

App.26a, n.1.

“In connection with the exercise of jurisdiction

over the rivers of the Nation through the construc-

tion of works of improvement, for navigation or

flood control, as herein authorised, it is hereby

declared to be the policy of the Congress to

recognize the interests and rights of the States in

determining the development of the watersheds

within their borders and likewise their interests

and rights in water utilization and control... .”

Emphasis added.

In addition to the flood control activities author-

ized under the Flood Control Act, the Federal Water

Pollution Control Act directs the Environmental

Protection Agency to establish, in cooperation with the

States, programs for reducing or eliminating pollution

and improving the sanitary condition of surface and

underground waters. These programs deal separately

with “point source pollution,” i.e. the effluent from any

discrete conveyance, pipe, ditch, channel, conduit or

any vessel or floating craft, and ‘non-point source

pollution” resulting primarily from rainwater and

stormwater runoff of land areas.

In respect to point source pollution, the EPA has

authority to establish effluent limitations for discharges

into navigable waters, and to authorize the States to

issue licenses and permits under the National Pollu-

tant Discharge Elimination System (NPDES) pro-

vided for in title IV of the Act. Pursuant to the

provisions of such title the Commonwealth of Virginia

has established and carried out NPDES programs

which have received full approval of the EPA.

Non-point source pollution is dealt with under

section 208 of the Federal Water Pollution Control

Act, which calls for the Governor of each State to

designate an organization capable of developing effec-

tive areawide water management plans for any prob-

lem areas. Pursuant to this section the Governor of

Virginia in 1974 designated the Southwest Virginia

Section 208 Planning Agency to make a com-

prehensive survey and prepare a study of water control

problems in the seven southwestern Virginia counties

comprising the coal producing region of the State."’

Participating in the Study were the Virginia State

Water Control Board, the Virginia Department of

Conservation and Econemic Development, various

local governmental agencies, the Virginia Division of

Mined Land Reclamation, the U.S. Soil Conservation

Service, the Environmental Protection Agency, and

various citizens advisory groups.

Based upon the data developed by the Section

208 Planning Agency over a period of four years it was

found that agriculture is the major source of pollution

and sedimentation of area streams in southwestern

Virginia, and that “up to 75 percent of the suspended

solids can be eliminated in many large streams by

controlling erosion from agricultural lands.” Operator’s

Ex.1, 373. See also, Memorandum Opinion of the

district court, J.S. App. 16a, n.1.

From the foregoing discussion two principal

points can be drawn. First, the statutes enacted by

Congress dealing with exercise of federal regulatory

powers over waters of the United States do not purport

to give the government jurisdiction over the upland

areas comprising the watersheds which drain into

17 The results of this survey, together with the findings of the

Study, were introduced in evidence at the trial as Operator’s Exhibit 1.

navigable streams and their tributaries. Second, the

federal interest in preventing water pollution has been

provided for through various programs and enforce-

ment actions authorized under the Federal Water

Pollution Control Act Amendments of 1972 without

resorting to the drastic land use regulation scheme of

the Federal Surface Mining Act.

THE DISTRICT COURT CORRECTLY HELD

THAT TITLE V OF THE FEDERAL SURFACE

MINING ACT PREEMPTS RESERVED

POWERS OF THE STATES IN

CONTRAVENTION OF THE

TENTH AMENDMENT

Assuming arguendo that there exists a federal

commerce interest in private land use, the question

remains as to whether the commerce power justifies

federal preemption of the historic reserved powers of

the States in this field, or whether the method cf

regulation selected by Congress constitutes a “drastic

invasion of State sovereignty where less intrusive

approaches are available.” District of Columbia v.

Train, discussed infra.

A. The Act Displaces Virginia’s Freedom to Structure

Integral Operations in Areas of Traditional Gov-

. ernmental Functions

As noted in National League of Cities v. Usery,

426 U.S. 833 (1976), “the test in judging whether

federal regulation is constitutionally permissible is

whether it interferes with a State’s “freedom to struc-

ture integral operations in areas of traditional govern-

mental functions.” 426 U.S. at 852. In establishing

such a test, the Covrt recognized that “[T]here are

attributes of sovereignty attaching to every state gov-

ernment which may not be impaired by Congress, not

because Congress may lack an affirmative grant of

legislative authority to reach the matter, but because

the Constitution prohibits it from expressing the au-

thority in that manner.” 426 U.S. at 845. As one

author has expressed it: “Expanded use of federal

authority to control the environmental consequence of

land use decisions is ultimately subject to the limita-

tion upon congressional power posed by the role of the

states aS sovereign entities within a federal system of

government.’”®

These concepts were previously considered in

District of Columbia v. Train, 521 F.2d 971 (1975),

vacated and remanded on other grounds, sub nom

EPA v. Brown, 431 U.S. 99. The Commonwealth of

Virginia, together with the State of Maryland and the

District of Columbia, contended in that case that EPA

regulations requiring State and local governments to

enforce vehicle exhaust emission standards, and other

EPA air quality control requirements under the Clean

Air Act, were in violation of the principles of feder-

alism embodied in the Tenth Amendment. The Court

of Appeals for the District of Columbia held that

although the Clean Air Act was a valid exercise of the

power of Congress to regulate interstate commerce, the

EPA enforcement activities improperly infringed upon

State sovereignty. As stated by the court:

18 Note, Zoning, Environmental Land Use Regulation, 91 Har-

vard Law Review 1427, 1610. (1978) [discussing National League of

Cities v. Usery, supra|

“It would thus appear that the extent of federal

intrusion into state sovereignty is of some rele-

vance even where the federal regulations are an

exercise of the commerce power. Since the Tenth

Amendment was described in Fry [ Fry v. United

States, 421 U.S. 542 (1975)] as declaring ‘the

constitutional policy that Congress may not ex-

ercise power in a fashion that impairs the States’

integrity or their ability to function in a federal

system,’ the restrictions may be directed to the

manner in which the federal government exercises

its commerce power. . .A_ federal regulation

which compels the states to enforce federal regu- |

latory programs clearly ‘impairs the States’ integ-

rity’ and ‘their ability to function in a federal

system.’ The Tenth Amendment thus provides an

additional ground for striking down these particu-

lar regulations.” 521 F.2d at 994. (emphasis

original ).

Similarly, in Brown v. EPA, 521 F.2d 827 (9th

Cir. 1975), vacated and remanded for consideration of

mootness, 431 U.S. 99 (1977), another case arising

under the Clean Air Act and the EPA regulations, the

Ninth Circuit Court of Appeals expressed deep con-

cern over a construction of the commerce clause which

“would reduce the states to puppets of a ventriloquist

Congress.” 521 F.2d at 839.

In Friends of the Earth v. Carey, 552 F.2d 25

(2nd Cir. 1977) the Court of Appeals noted:

“In determining whether an otherwise valid ex-

ercise of the federal commerce power would

impermissibly impair state sovereignty we are

therefore required to balance the reason for the

exercise against the extent of the usurpation of

state policy-making or invasion of integral state

functions that would result, giving ‘inappropriate

recognition to the legitimate concerns of each

government.’ ” 552 F.2d at 37.

In summary, the Court must balance the interests

of federal and state sovereignty in ruling upon the

constitutionality of the Act. Under the federal

scheme, ‘‘neither government may destroy the other nor

control in any substantial manner the exercise of its

power.” National League of Cities, 426 at 844, citing

Metcalf & Eddy v. Mitchell, 269 U.S. 514 (1926). As

discussed below, the Act deprives states of dis-

cretionary authority over land use planning and thus

impermissibly intrudes upon an integral and tradition-

al function of state government.

1. The Act Impermissibly Removes State Dis-

cretionary Authority Over Land Use Planning

and Control of Surface Mining

In Sierra Club v. EPA, 540 F.2d 1114 (D.C. Cir.

1976), cert. den. 430 U.S. 959, the Court of Appeals

observed that the Tenth Amendment is not infringed if

“the states retain broad discretion under the regu-

lations to control the use of their land in the scope of

their economic development.” 540 F.2d at 1140.

In the case at hand the district court found that

“The evidence presented to this court clearly shows

that the Commonwealth of Virginia does not retain

broad discretion under the regulatory scheme devised

by Congress to control economic development of the

land in southwest Virginia, nor does it retain the

power to make choices as to essential decisions regard-

ing that land.” J.A. App.35a. The court went on to

State that:

“The provision requiring ‘return to approximate

original contour’ for all operations, regardless of

the conditions, is the most intrusive practical

aspect of the Act ... Virginia is particularly

affected by this legislation because ninety-five

percent of its strippable reserves are located on

slopes in excess of twenty degrees, and, therefore,

the approximate original contour provision comes

into play with regard to almost all of the state’s

coal reserves.” J.S. App.35a, 36a.

Because there is a great need for level land in south-

west Virginia, the court noted, leaving the land in a

level state instead of restoring it to approximate origi-

nal contour would allow it to be used for a variety of

purposes important to the economic development of

the region. The court accordingly concluded that:

“In enforcing this requirement the State has lost

control over the economic development that could

take place in southwest Virginia. The Com-

monwealth is deprived of its right to dictate

whether this land could be better used for some

other purpose.” J.S. App.36a.

The Secretary argues (Brief pp. 30,31) that Na-

tional League of Cities is not applicable here because

the “regulation of surface coal mining is not the kind

of ‘integral governmental function’ protected by the

Tenth Amendment.”

The district court dealt directly with this con-

tention, and on the basis of the trial record concluded

that the Federal Act has a significant impact on

integral State functions “[T]hrough forced relinquish-

ment of State control of land. use planning; through

loss of State control of its‘economy; and through

economic harm, from destruction of the taxing power

of certain counties, cities and towns.” Because of this,

the court found, “The Act has substantially restruc-

tured traditional ways in which the local governments

have arranged their affairs.” J.S. App.40a; National

League of Cities, 426 U.S. at 849.

2. The Act Displaces State Policy Regarding

Land Use Planning and Control Which Has

Traditionally Been A Function Of State And

Local Government.

Neither the holding of National League of Cities

nor the range of “integral” functions can be confined

to decisions involving wages and hours of State and

municipal employees, or police and fire protection

activities of local governments. If this is all that is left

of State sovereignty then the Tenth Amendment is

indeed a dead letter. The district court more correctly

construed State land use regulation as being “an

integral portion of those governmental services which

the States and their political subdivisions have

traditionally afforded their citizens,” citing National

League of Cities, 426 U.S. at 855, and noted that “A

state is its citizens and protection of their land is as

vital an activity as any of the other enumerated

services.” J.S. App. 34a.

For more than 200 years regulation of land use

has been exercised exclusively by the States. City of

Euclid vy. Ambler Realty Co., 272 U.S. 365; Berman v.

Parker, 348 U.S. 26 (1954); Village of Belle Terre v.

Boraas, 416 U.S. 1 (1974). As noted by this Court in

Warth v. Seldin, 422 U.S. 490, 508 N.18 (1975),

“Zoning laws and their provisions, long considered

essential to urban planning, are peculiarly within the

province of the State and local legislative authorities.”

The federal government has not, prior to this Act,

claimed any supervening authority in this area. The

Act thus raises a critical question as to whether

Congress can effectively amend the Constitution, and

accomplish a transfer of these historically reserved

State powers to a federal agency in Washington, by

the simple expedient of making a legislative finding

that use of land for surface coal mining adversely

affects interstate commerce.

It seems reasonable to infer that land use regu-

lation is typical of those activities “performed by state

and local governments in discharging their dual func-

tions of administering the public law and furnishing

public services.” See National League of Cities, 426

USS. at 851.

The Secretary responds to the district court’s

findings of displacement of integral state functions

with the misleading and inaccurate assertion that

“[t]he variance procedures in § 515 add flexibility to

the ‘approximate original contour’ rule and ensure

that, in appropriate circumstances and with adequate

environmental safeguards, mine operators and land

owners will be permitted to create usable flat land on

steep slopes, if that is needed for an ‘equal or better

economic or public use’ after mining is completed.”

(Brief p. 35). It is astounding that the Secretary

would attempt to mislead the Court in this manner,

since the variance language of § 515(e) is conditioned

by the proviso that “complete backfilling with spoil

material shall be required to cover completely the

highwall which material will maintain stability follow-

ing mining and reclamation.”

The district court considered this very point, and

noted that the Secretary’s own comments published

with his proposed regulations admitted that the

requirement for completely covering the highwall ren-

ders the variance provision of little use on steep slopes.

44 Fed. Reg. 61313, October 4, 1979. The court added

that “For all practical purposes, the backfilling stipula-

tion destroys the usefulness of a variance since the

highwall must still be covered.” J.S. App. 36a, n.9.

See also, JS. App. 37a, n.10; J.S. App. 45a.

An identical conclusion has been reached by the

board to which the Secretary has delegated his func-

tions of deciding disputes arising under the Act. In

Tollage Creek Elkhorn Mining Co., IBSMA 80-32,

November 24, 1980, the Interior Board of Surface

Mining Appeals considered a notice of violation charg-

ing Tollage Creek with failure to restore the land to

approximate original contour. The owner of the

surface area planned to use the land for a tree farm

after mining was completed, and prior to mining

obtained a permit from the State of Kentucky allowing

a variance for this purpose. Despite the State variance

permit the Board upheld the charged violation because

the highwall was not completely covered. In so doing,

however, the Board noted that

“Tt is with difficulty that we have reached the

result in this case. Common sense and fairness

would appear to require an opposite result. The

Federal law seems inescapable, however. Had

Congress been presented with the factual situ-

ation here, where elimination of the highwall

would not benefit the environment but only bur-

den the operator or landowner, it may have

provided in the Act for some exception to the rigid

backfilling requirements. Apparently, it was not.

Clearly it did not.”

In the context of the foregoing discussion it is

evident that the Act does constitute a drastic intrusion

of federal authority in an area previously considered

the exclusive domain of sovereign States. Further even

if the Act does not compel Virginia to regulate mining

by its express terms, the Act clearly displaces existing

land use statutes peculiarly applicable to mining in

Virginia with national standards proved to be

impracticable in application to the State’s terrain.

B. Less Intrusive Approaches Are Available for Deal-

ing With The Environmental Effects of Surface

Coal Mining

Under the principle established in Fry v. United

States, discussed ante, even a drastic invasion of state

sovereignty may be constitutional where less intrusive

approaches are unavailable. 421 U.S. at 542. In the

instant case the Court must continue to employ a

balancing approach in determining whether there exist

less intrusive measures available to Congress which

would produce the same or similar results while pre-

serving the sovereignty of the State in matters of land

use control.

As has been seen, there are currently in effect

various federal programs for dealing with air and

water quality under the Clean Air Act and the Federal

Water Pollution Control Act of 1972. The federal

regulations adopted under these statutes apply with

equal force to the surface coal mining industry as to all

other industries. Any atmospheric pollution generated

as a result of surface coal mining is subject to all

enforcement powers and sanctions administered by

the Environmental Protection Agency under the Clean

Air Act. All mining operations, both surface and

underground, are currently required to comply with

the pollution control programs adopted pursuant to the

Federal Water Pollution Control Act. The basic

requirement of this latter program is that no effluents

may be discharged from any “point source” into

streams which ultimately ‘ead into navigable water-

ways except pursuant to the terms of an NPDES

permit. Persons responsible for failure to comply with

permit requirements may be fined up to $10,000 per

day under EPA administrative procedures, and wilfull

violations are subject to criminal provisions author-

izing fines of not less than $2,500 and not more than

$25,000 per day of violation, and one year of impris-

onment for the first offense.'®

It is thus evident that prior to enactment of the

Federal Surface Mining Control and Reclamation Act

there were in effect federal and state programs estab-

lishing strict environmental safeguards for air and

water contamination associated with or incidental to

surface coal mining. Appellees submit that these

regulatory programs, which are designed to vindicate

the federal interest in clean air and water, represent

the acceptable limits of federal intrusion upon the

historic police powers of the States in the area of public

safety and welfare. Because the federal interest can be

and has been effectively dealt with under the existing

programs, the wholesale preemption of State police

powers under the Federal Act constitutes a “drastic

19 33 U.S.C. 1319.

invasion of state sovereignty where less intrusive ap-

proaches are available.” Train, supra.”

C. The Court Should Balance Competing Federal,

State and Private Interests in Construing the Act

Justice Blackmun interpreted National League of

Cities v. Usery to have adopted a “balancing

approach” in assessing the constitutionality of a feder-

al act which encroaches upon rights reserved to states

under the Tenth Amendment. 426 U.S. at 856. See

also Friends of the Earth v. Carey, 552 F.2d 25, 37 (2d

Cir. 1977). In certain areas, such as environmental

protection, Justice Blackmun considered the federal

interest to be “‘demonstrably greater” and state facility

compliance with imposed federal standards to be

essential. 426 U.S. at 856. The present challenge to

the Act under the Tenth Amendment cannot be

dismissed, however, by simply categorizing it as an

“environmental case.” That which is regulated under

the Act here is not air or water, which may have

measurable affects upon the nation as a whole. Rath-

er, it is /and as land that is subjected to federal control

by the Act. The Secretary attempts to avoid the

obvious by suggesting that the Act merely regulates

surface mining. As previously noted, however, the Act

and implementing regulations have been described by

the former Associate Solicitor for the Division of

Surface Mining as forming “a land-use regulatory

scheme that is national, uniform and mandatory.” ”

20 Appellees in no way suggest that protection of air and water

are beyond the reach of federal regulatory powers. See discussion

p. 13 ante.

214 Harv. Envir. L. Rev. at 235; cited at note 12, ante.

Viewed in this light, the case cannot be deter-

mined by reference to those cases considering congres-

sional enactment of laws “regulating individual busi-

ness necessarily subject to the dual sovereignty of the

government of the Nation and of the State in which

they reside.” 426 U.S. at 845. Regulation of mining or

mine safety or environmental factors, all of which

have been held to be valid exercises of federal power,

is not the basic impact of this Act. Rather, the federal

government now seeks not merely to regulate but to

plan for land use in all States and localities.

Under the balancing test the federal interest must

be “demonstrably greater” than the interest of the

State, and for the reasons stated below it is submitted

that federal interest in land use planning per se is not

demonstrably greater than. that of states.

1. Land Is A Unique Commodity Not Readily

Susceptible to Uniform, Nationwide Planning

or Regulation.

Prior to the Act federal efforts to impose nation-

wide land resources regulation have, with few ex-

ceptions, taken the form of financial incentives to

states and localities to implement regulations. See

Note, 4 Harv. Envir. L. Rev. at 239-40 fn. 68-74. That

Congress has not previously sought to impose “‘nation-

wide, uniform and mandatory” land use requirements

undoubtedly reflects recognition of the uniqueness of

each parcel of land. It is hornbook law that land is

unique. Land traditionally has been subject to the

equity jurisdiction of the courts so as to provide

flexibility and avoid harsh results that might obtain if

considered under rigid rules of iaw. IV Pomeroy’s

Equity Jurisprudence § 1402, p. 1034, 2 Story, Equity

Jurisprudence §§ 829-843, 993. Rigid applications of

uniform laws or regulations frequently lead to irra-

tional results as evidenced by the trial court’s findings.

For instance, a very great part of the trial evi-

dence dealt with the question of whether restoring

steep mountain slopes to approximate original contour

is an environmentally sound practice. The expert

witnesses were in general agreement that the infinite

number of variables that may be encountered in the

topography, geology and hydrology of mountain areas

require individual consideration of the methods to be

used in erosion and sediment control, and that no one

method can be prescribed as an across-the-board best-

technology approach for this purpose. Tr. 2557-2562,

2652-2654, 2667-2702.

According to the great weight of the engineering

testimony, restoring slopes to original contour results in

a greater amount of disturbed soil being exposed to

stormwater precipitation at a steeper angle on the

mountainside, and as a result the restored slope is

subject to greater erosion, slippage and landslides than

is the case where the mining bench area is graded to a

more level contour with appropriate drainage and

diversion structures, and a portion of the highwall is

left. In the latter situation the rainwater runoff from

upper slopes is interrupted by the reclaimed mining

bench, and because the compacted fill material on the

mining bench has a high water retention capacity

there is less likelihood of stream sedimentation or

flooding from heavy rainfall. Tr. 627-630, 633-634,

1169-1171, 1197, 1834, 2554-2555. Dr. Donald

Haney, State Geologist and Director of Geological

Research for the Commonwealth of Kentucky, de-

scribed the experiences encountered on similar terrain

in Eastern Kentucky where the State Highway Depart-

ment has been trying for 50 years to control steep

angle slopes on highway cuts. He stated that the fill

material cannot be stabilized, and that continual

erosion, slippage and rock falls create a constant

maintenance problem. Similar problems have been

experienced, he said, in attempting to comply with the

approximate original contour requirements of the Act

on surface coal mining operations in Eastern Ken-

tucky. In his opinion a far better environmental result

is obtained by compacting the fill material on the

mining bench to the extent practical, and leaving a

portion of the highwall exposed. Tr. 2621-2625.

Benjamin C. Green, former Deputy Director of the

West Virginia Department of Natural Resources, testi-

fied that restoration of original contour creates an

impossible situation from an environmental point of

view because “if you take the material to the top of the

wall, you blend in and complement the surrounding

slopes, then you have greatly accelerated the erosion

and sediment control problems, you are, of course,

duty bound to prevent.” Tr. 2544.

On the basis of this and similar testimony the

district court reached its finding that the original

contour requirement is so particularly unsuited to

Virginia’s terrain that compliance with its provisions

has a higher potential for environmental harm than

alternative methods of reclamation. J.S. App. 39a.

The Secretary argues ( Brief p.48 ) that the district

court’s findings are not supported by the weight of the

evidence. For this purpose he selects certain items of

trial testimony which supposedly refute the trial court’s

findings, but which, in fact, do not. In a footnote on

page 48 of his brief the Secretary cites testimony of

Ronald Hill to the effect that the statutory standards

could be achieved by use of the so-called “block cut”

or “haulback” method of surface mining. The district

court specifically found, however, that use of this

method of surface mining is not feasible in the steep

mountain areas of Virginia. J.S. App. 37a, n.10; 43a,

n.14. The Secretary further refers to opinion testimony

of Dr. David Maneval to the effect that the steep slope

requirements could be met in Virginia, but Dr. Mane-

val admitted that his experience was limited to surface

mining in Pennsylvania where coal deposits are found

on flat or gently rolling terrain totally unlike that in

southwestern Virginia and other portions of central

Appalachia. Tr. 1008-1014a.” Billy R. Loughry,

whose testimony is also cited by the Secretary, agreed

that surface mining in Pennsylvania is completely

different so far as terrain conditions are concerned,

and in his view it would be impossible to comply with

the original contour requirement in the steep slope

terrain in Virginia. Tr. 1822. Dr. Richard Newcomb,

the government’s mineral economics expert, whose

testimony is also cited in the Secretary’s brief, admit-

ted on questioning by the Court that the statistical

data he had compiled and discussed in his testimony

was entirely theoretical and had little or no bearing on

the problems encountered by Virginia surface mine

operators under the Federal Act. Tr. 1343-1357.

In any event, the findings of the district court on

the basis of the trial evidence should be accorded

deference as provided in Rule 52 of the Federal Rules

22 Dr. Maneval conceded that no more than six percent of

Pennsylvania coal is on slopes of 20 degrees or more, as compared

with ninety-five percent in Virginia. Tr. 1008-1010.

of Civil Procedure. As stated in that Rule, “Findings

of fact shall not be set aside unless clearly erroneous,

and due regard shall be given to the opportunity of the

trial court to judge the credibility of the witnesses.”

See United States v. U.S. Gypsum Co., 333 U.S. 364,

393 (1948); Kelley v. Southern Pacific Co., 419 US.

318 (1974). In the present case there is no basis for

concluding that the findings of the district court on the

environmental undesirability of restoring steep slopes

to original contour are clearly erroneous.

This type of detailed, terrain-specific inquiry is

almost invariably necessary when considering land use

control. The flaw of the Act, therefore, lies not merely

in the breadth of its scope but in the inflexible nature

of the rules it imposes. Simply stated, what works in

Pennsylvania does not work in Virginia.

In view of the multiplicity of uses to which land

may be put, and the peculiarly local factors which may

influence any particular use or value, it is difficult to

state categorically that a federal interest in land use

allocation as contemplated under the Act is “demon-

strably greater” than the interests of state and local

governments and their citizens who are most immedi-

ately affected thereby. Even if, for example, return to

original contour would improve the aesthetic value of

the land, it does not balance out the economic depriva-

tions imposed upon the affected communities by loss of

employment, tax revenues and other benefits derived

from surface mining.

2. Land-Use Planning Is A Traditional Service

Of State and Local Government And Particu-

larly Within Their Expertise

Over one hundred years ago this Court recognized

that use, sale or other disposition of land was of vital

concern to the States as States.

“The title and modes of disposition of real proper-

ty within a state, whether inter vivos or testa-

mentary, are not matters placed under the control

of federal authority, for such control would be

foreign to the purposes for which the federal

government was created, and would seriously

embarrass the landed interests of the state.” U.S.

v. Fox, 94 U.S. 315 (1876).

Both the Court in National League of Cities and

the district court recognized that the validity of a

Tenth Amendment bar to the exercise of the Com-

merce Clause by Congress hinges in large part on the

degree to which a State, as a state, is affected. 426

U.S. at 875 and J.S. App. at 32a, respectively. As

previously discussed, the lower court concluded that

[ W Jhile the Act ultimately affects the coal mine

operator, its pervasive effect is on the states’

'egislative authority and on state control of land

within its boundaries. J.S. App.32a.

The district court properly ascertained that the Act

regulates surface mining in order to achieve federal

land-use planning goals.

Land neither moves in commerce, nor is trans-

portable to other jurisdictions. Land-use planning has

substantial effects but they are localized. Decisions

about land use, moreover, should be made by those

persons who must live with their decisions, i.e., repre-

sentatives of municipal, county, or state governments.

Land use and planning directly affects the prosperity

of their citizens, generation of tax revenues to fund

basic governmental services, and the aesthetic values

of the immediate environment in which they reside. It

is the typical function “essential to separate and

independent existence” of a state. See, National

League of Cities, 426 at 845 citing Coyle v. Oklahoma,

221 U.S. 559, 580, and Lane County v. Oregon, 7

Wall. 71 76.

Ill

SECTIONS 515 AND 522 OF THE SURFACE

MINING ACT CONSTITUTE A TAKING

OF PROPERTY WITHOUT JUST

COMPENSATION IN VIOLATION OF

THE FIFTH AMENDMENT

The individual plaintiffs in this case include

owners of fee interests in coal lands, as well as surface

mine operators who have leased mineral rights on

mountain slope acreage. The interests of these plain-

tiffs are tangible interests having substantial economic

value. The trial evidence established that in the

mountain ridges of Southwest Virginia, coal is usually

found in multiple seams separated by “partings” of

intervening rock and shale strata. Where these seams

are mineable by surface mining methods the amount

of recoverable coal per acre foot is approximately 1700

tons and, based on the average thickness of seams, the

average tonnage yield per acre is from 8000 to 9000

tons. Pr. Tr. 22-23, 41.%° At current royalty rates and

market prices, the economic value which a fee owner

leasing his land to a coal mine operator can derive

from his mineral estate interest represents approxi-

mately $20,000 an acre. Id., 22,42. The fee owner

can, in addition, realize substantial residual value as a

result of the increased utility of the land after removal

of the coal if it is reclaimed to a more level con-

figuration appropriate for agriculture, grazing, silvicul-

ture or commerical development. Id., 23-25, Tr. 696-

709. In its original state the steep slope land has no

productive use for these or other purposes.

J.S.App.56a.

Although predictions of profitability are always

matters of speculation, the trial evidence established

that the residual value of reclaimed surface mined

areas after removal of the coal is dependent upon the

extent to which it is left in a relatively level state.

Other dependent factors include proximity to popu-

lation centers and accessibility to improved public

roads and highways. After careful consideration the

trial court accepted as accurate the uncontroverted

testimony of real estate experts from the southwestern

Virginia area that reclaimed level land adjacent to

highways or populated areas may command prices up

to or in excess of $100,000 an acre, whereas if

reclaimed to its approximate original contour “its

value has been diminished to practically nothing,” J.S.

App.45a, Tr. 696-709, 843-844; Pr.Tr. 20-25, and it

has no practical value or use. As the district court

aptly observed:

23**Pr. Tr.” refers to the transcript of testimony at the preliminary

injunction hearing before the district court.

“This is a case in which the Surface Mining Act

must be viewed in a practical sense, for it involves

more than just a large diminution of land value,

more than commercial impracticality. In Virginia

the evidence shows that surface landowners are

possessed of small tracts usually less than one-

hundred acres. The requirement of return to

approximate original contour amounts to a physi-

cal restriction on the removal of coal... Because

of the nature of the land, the owner is thereby

deprived of any use of his land, not only the most

profitable use.” J.S. App.55-56a.

The trial evidence showed that the mining equip-

ment required for a typical surface mining operation in

this area involves an investment of between one and

one-half to two million dollars. Tr.377-410, 852-869,

875-881. Pr.Tr. 105-111. The additional earth mov-

ing necessary to return to original contour, if such were

physically possible, would require special equipment

investment of a magnitude far beyond the financial

capabilities of mine operators typical of those oper-

ating on these relatively small tracts.”

As a result of the original contour requirements of

the Act the stark reality faced by the individual

plaintiffs is that no practical use can be made of their

property. Far from suffering a mere “diminution” in

the value of their property, plaintiffs are deprived

outright of any and all reasonable use.

In concluding that the prohibitory effect of Title V

effectuates a “taking” of plaintiffs’ property the district

24 As previously noted, the district court found that return to

original contour and completely covering the highwall is for all

practical purposes physically impossible of aitainment.

court reviewed the principals laid down by this Court

in the cases beginning with Hadacheck v. Sebastian,

239 U.S. 394 (1915), United States v. Cress, 243 U.S.

316 (1917) and Pennsylvania Coal Co. v. Mahon, 260

U.S. 393 (1922), through United States v. Causby, 328

U.S. 256 (1946), Goldblatt v. Hempstead, 369 US.

590 (1962), Penn Central Transportation Co. v. City of

New York, 438 U.S. 104 (1978), Andrus v. Allard, 444

U.S. 51 (1979), and Kaiser Aetna v. United States,

444 US. 164 (1979).

After a scholarly discussion of “The formulas and

factors [which] have been developed in a variety of

settings”, Allard, supra, the district court concluded

that

‘In the case now before this court the facts are on

all fours with Pennsylvania Coal Co. v. Mahon.

This is not a case involving ‘an average reciprocity

of advantage,’ 260 U.S. at 415, which has been

recognized as a justification for zoning and other

laws . . . Because of the nature of the land, the

owner is deprived of any use of his land, not only

the most profitable use.” J.S. App.55a.

Appellees believe that the district court properly

applied the rule of Pennsylvania Coal Co. to the facts

of this case. In making the determination that a

taking had occurred, the Court in Pennsylvania Coal

recognized the presumption of general validity which

attaches to every legislative enactment, yet, according

to Justice Holmes, the exercise of the police powers of

the State must have its limits “or the contract and due

process clauses are gone.” 260 U.S. at 413. In

attempting to strike a balance between the govern-

ment’s power to regulate for the public interest and

constitutionally protected property rights, Justice

Holmes laid down the broad principle so often reit-

erated by this Court:

“The general rule, at least, is that while property

may be regulated to a certain extent, if regulation

goes too far it will be recognised as a taking.” Id.,

at 145.

The continuing force and validity of Pennsylvania

Coal has been repeatedly acknowledged by this Court.

Although there is no case more compellingly apposite

to the instant case than Pennsylvania Coal, it is indeed

curious that the Secretary’s brief relegates discussion of

its significance to a single footnote which, moreover,

attempts to explain the holding in that case as one

where the Court was “unwilling to apply general rules

at the instance of private parties hoping to be excused

from their bargain.” Brief, 57, n.34.

The Secretary proceeds to cite Goldblatt, supra, for

the proposition that ‘‘a taking should rarely be found

where the interference arises ‘from some public pro-

gram adjusting the benefits and burdens of economic

life to promote the common good.” Brief, 54. Ap-

pellees do not quarrel with this general principle of

balancing the benefits and burdens of governmental

regulation, but point out that the district court here

found no evidence that sections 515(d) and 522

promote the common good, and, in fact, found that

their provisions do not accomplish that purpose. J.S.

App.55a, n.16.

There is the further fact that an owner of land has

a justifiable expectation that any determination as to

the permissible use of his land will be made by the

State or local authorities who have exclusively ex-

ercised this function in the past, and that he will not

be subjected to a massive body of zoning or land use

regulations by a completely different governmental

entity.* It is not unreasonable to assume that many

persons who have invested in coal lands with the

expectation that they could remove the coal by surface

mining methods would not have made such in-

vestments had they reason to believe that they would

be subjected to a pervasive scheme of land use regu-

lations and controls such as that created by the

Federal Act. The landowner plaintiffs in the present

case are in substantially that type of situation, where

they now find that the federal regulations frustrate

their “reasonable investment-backed expectations.”

See Kaiser Aetna v. United States, 444 U.S. 164

(1979).

In attempting to fit this case within the frame-

work of Penn Central Transportation Co., supra, the

Secretary’s brief ignores two important distinctions.

First, the plaintiffs in Penn Central sought to obtain

compensation for the loss in the value of their property

resulting from the Landmark Law, whereas in the

present case appellees have sought and obtained a

declaratory judgement invalidating those portions of

the Surface Mining Act which deprive them of the use

25 One author has described a right of procedural due process as

one which requires that some legislative actions be undertaken only

by a governmental entity which is so structured and so charged as to

make | ‘ssible a reflective determination that the action contemplated

is fair, sasonable, and not at odds with specific prohibitions in the

Constitu on.” Note, Insular Majorities, 91 Harvard Law Review.

1373, 1414 (considering Hampton v. Mow Sun Wong, 426 U.S. 88

(1976)). See also, Due Process of Lawmaking, 55 Nebraska Law

Review 197 (1976).

of their property and totally destroy its value. Second,

the finding of the Court in Penn Central that the

plaintiffs there had not been deprived of all reasonable

use of their property is quite different from a case such

as the present case where it was found that the Act has

effectively precluded any economic use of the plain-

tiffs’ property.

The Secretary continues to misrepresent the true

impact of the Federal Act by arguing (Brief 52) that

there is no “taking” under sections 515(d) and 522

because section 515(c) provides for variances from

approximate original contour (an argument we have

dealt with earlier in this brief), and because the

prohibitions contained in section 522(e) against min-

ing on specified lands were expressly made subject to

“valid existing rights” and “do not apply to surface

coal mining operations . . . which exist on the date of

enactment.” Brief 54. The reality is, however, that the

exception for valid existing rights applies only to

specific surface mining operations for which all re-

quired permits were issued prior to August 3, 1977, the

effective date of the Act, and it has no applicability to

the great preponderance of the lands and mineral

interests of plaintiffs which were not “permitted” as of

that date, and which are now subject to the restrictions

imposed by the Act. Any suggestion that one who

owned coal lands or mineral rights as of the date of the

Act is unaffected by the section 522 restrictions is

totally false. The clear intent of the language of the

Act, as well as the Secretary’s interpretation, is that

“valid existing rights” applies only to surface mining

acreage for which all permits were issued and in effect

as of August 3, 1977. Except, then, for the limited

parcels for which mine operators had obtained permits

before the date of the Act, the prohibitions of section

522 deny to the owner the use of his land for surface

mining.

Similar efforts by the Secretary to analogize the

challenged portions of the Act to other governmental

regulations aimed at preventing “nuisances” cannot be

seriously entertained. The Secretary’s brief cites vari-

ous cases which, on various “nuisance” theories, justify

restrictions on property use. (See e.g. Goldblatt v.

Town of Hempstead, supra; Miller v. Schoene, 276

U.S. 272 (1928); Pierce Oil Corporation v. City of

Hope, 248 U.S. 498 (1919); Hadacheck v. Sebastian,

supra; Reinman v. City of Little Rock, 237 U.S. 17]

(1915); Moore v. City of East Cleveland, 431 U.S. 494,

513 (1977), cited at p.57 of appellant’s brief). An

examination of these cases provides no basis for

factual analogy to the instant situation, since the

challenged portions of the Act have been found by the

trial court to be inconsistent with the common good of

the citizens and communities in southwestern Virginia,

and demonstrably unsound from an environmental

standpoint. Far from constituting a nuisance, surface

coal mining in southwestern Virginia must be regarded

as benefiting the lives of the people. Moreover,

although it was the legislative judgement of Congress

that completely unregulated surface mining may have

deleterious effects upon the environment and the pub-

lic welfare, Congress also incorporated into its State-

ment of Findings and Policy the express finding that

“surface mining operations ... contribute to the

economic well-being, security, and general welfare of

the Nation,” §101(j), and there is no suggestion in the

Act that surface coal mining should be declared a

nuisance.

Although in recent years this Court has shifted its

emphasis in describing the elements of a taking, (see,

e.g. Andrus v. Allard, 444 U.S. 5] (1979), in which

the Court viewed a “taking” as “the loss of profit

opportunity . . . accompanied by a physical restric-

tion against the removal of coal” Jd, n.22; Kaiser

Aetna v. U.S., 444 U.S. 164 (1979), in which the

Court identified factors such as “the economic impact

of the regulation, its interference with reasonable

investment-backed expectations and the character of

the governmental action”) the Couri has also contin-

ued to cite Pennsylvania Coal with approval in these

and other cases. However unable the Court may be to

develop any “set formula” for determining when a

taking has occurred, (Penn Central Transportation

Company, supra,) it is clear that the “‘ad hoc factual

inquiry” required by Penn Central, which was

painstakingly undertaken by the district court here,

has resulted in a well-substantiated determination that

Portions of the surface mining Act effectively take

plaintiffs’ property without just compensation in viola-

tion of the Fifth Amendment.

Finally, the Secretary suggests (Brief p.59) that

the Tucker Act may provide an alternate basis for

relief by way of compensation, but quickly adds: “One

may doubt whether the jurisdictional grani in the

Tucker Act was ever intended to cover taking claims

arising from regulatory legislation.”

The Tucker Act as an adequate remedy in cases

such as this was rejected by the Court in Duke Power

Company v. Carolina Environmental Study Group, 438

U.S. 59 (1978). The plaintiffs there were seeking a

declaration that the Price-Anderson Act, which limits

the monetary liability of electric utility companies for

nuclear accidents, could result in widespread property

losses without adequate compensation, and thus con-

travened the Fifth Amendment. The Court held that

the plaintiffs had stated a proper cause of action under

28 USC 1331, and rejected the contention that their

“taking” claim could only be adjudicated in the Court

of Claims under the Tucker Act. In commenting on

this point the Court stated:

“Mr. Justice Rehnquist suggests that appellees’

taking claim will not support jurisdiction under

section 1331(a), but instead that such claims can

only be adjudicated under the Tucker Act, 28

USC 1491. We disagree. Appellees are not

seeking compensation for a taking, a claim prop-

erly brought in the Court of Claims, but are now

requesting a declaratory judgement that since the

Price-Anderson Act does not provide advance

assurance of adequate compensation in the event

of a taking it is unconstitutional . . . While the

Declaratory Judgement Act does not expand our

jurisdiction, it expands the scope of available

remedies. Here it allows individuals threatened

with a taking to seek a declaration of the con-

stitutionality of the disputed governmental action

before potentially uncompensable damages are

sustained.” 438 U.S. at 71, n.15.

Appellees here are seeking a declaratory judge-

ment action before potentially uncompensable dam-

ages are sustained. In such event the question con-

cerning the availability of the Tucker Act as a remedy

becomes irrelevant, since the Tucker Act affords nei-

ther adequate compensation nor the precise relief to

which appellees are entitled.

THE DISTRICT COURT CORRECTLY

ENJOINED THE ISSUANCE OF SUMMARY

CESSATION ORDERS UNDER SECTION 521 (a)

(2) OF THE ACT AND THE PREPAYMENT

OF PENALTIES UNDER SECTION 518 ON

THE GROUND THAT THEY VIOLATE THE

DUE PROCESS CLAUSE OF THE

FIFTH AMENDMENT.

The Secretary’s attack (Brief 62) upon the district

court’s decision on this issue is grievously inaccurate.

The Secretary states that plaintiffs at trial neither

alleged nor showed that any of them received a

summary cessation order or suffered any loss as a

result of any such orders. This statement is intended

to support the Secretary’s argument that no case or

controversy exists, and that as a result the district

court’s decision was somehow premature.

The district court’s Memorandum Opinion, as

well as the record, directly refutes this assertion. The

district court expressly found that three cessation

orders were issued to Paramont Mining Corporation,

one of the plaintiffs herein, and were later vacated as

improper. It also found that the company sustained

substantial losses as a result. (J.S. App. 65a-66a).

Based on these and other similar examples the district

court concluded:

“The evidence shows that in enforcing the law,

OSM inspectors have issued unjustified and arbi-

trary cessation orders causing irreparable harm to

the mining companies.” Jd. at 65a.

and

“The court considered the evidence regarding the

enforcement procedures used by the OSM in-

spectors to be shocking. . . .” Jd. at 70a.

As a result of these findings, all of which are

adequately supported by the evidence, the district

court quite properly found that the application of

Section 521 (a) (2) of the Act violates the due process

clause of the Fifth Amendment because it allows

federal inspectors to summarily close down a mining

operation without proper cause and prior to any

opportunity for a hearing.

The Secretary argues (Brief 62-63) that a prior

hearing is not necessary, and cites a number of

decisions of this Court. The district court considered

most of the same cases (J.S. App. 63a-64a) and

properly found them not controlling. Suffice it to say

that none of those decisions sanctions a remedy so

severe and so subjectively enforced as the case at

hand.

The Secretary relies much upon Ewing v. Mytinger

& Casselberry, Inc., 339 U.S. 594 (1950), a case which

involved multiple seizures of misbranded food supple-

ments under Section 304 of the Food, Drug and

Cosmetic Act, 21 USC 334. This Court rejected a due

process challenge to the constitutionality of the proce-

dures employed, even though a preliminary adminis-

trative determination of probable cause was made by

the agency without any opportunity for the owner of

the goods to have a hearing.

The Ewing case is factually distinguishable from

the instant case. The administrative determination

there appears to have been made at the highest level of

the agency, and the preliminary agency action was

further reviewed by the office of the United States

Attorney General. Only then, was the actual decision

made to file a series of libels against the products

involved.

While the Court in Ewing did state that a hearing

to protect property rights is not always required before

summary governmental action is taken, neither that

case nor any of the others cited by the Secretary stands

for the proposition he is urging upon this Court. He

asks the Court to ignore the detailed findings of the

district court regarding widespread abuses of power by

his own agents. He quotes from Ewing (Brief 63) to

buttress his statutory authority, in total disregard of

the injuries judicially determined to have been brought

about by his representatives. If an inspector employed

by the Secretary can—as many have—shut down a

mine and thereby cause severe financial loss, and

unemployment, either upon a whim or in error, then

the Secretary has successfully overturned the rule

stated by this Court only four years ago that:

‘The right to be heard before being condemned to

suffer grievous loss of any kind, even though it

may not involve the stigma and hardship of a

criminal conviction, is a principle basic to our

society. . . The fundamental requirement of due

process is the opportunity to be heard ‘at a

meaningful time and in a meaningful manner’.”

Mathews v. Eldridge, 424 U.S. 319 (1976) at 333,

citing Joint Anti-Fascist Comm. v. McGrath, 341

U.S. 123 (1951). (Frankfurter, J. concurring. )

Surely this is the key to the instant case. The

district court has required the Secretary to give a mine

operator a hearing at a meaningful time and in a

meaningful manner. Because a summary cessation

order can be the equivalent of an economic death

sentence for a small mine operator, a hearing held

before that sentence is carried out is the only one that

is truly meaningful. Rather than accept the Secre-

tary’s suggestion to allow him unfettered power, this

Court should uphold the eminently reasonable and

modest constraints upon that power imposed by the

district court. See also Goldberg, v. Kelly, 397 U.S. 254

(1970), where this Court, consistent with the views

expressed in Mathews, held that due process requires

an evidentiary hearing prior to even a temporary

cessation of governmental economic benefits, since

such action could deprive an eligible person of his very

means of existence. Jd. at 264. The analogy to the

present case is clear because—as the district court

found —a cessation order can deprive a mine operator

and his employees of their means of existence.

In ruling on this issue the district court cited and

followed the rule laid down by this Court in Mathews

v. Eldridge, supra, where the Court stated:

‘*... Identification of the specific dictates of due

process generally requires consideration of three

distinct factors: first, the private interests that will

be affected by the official action; second, the risk

of an erroneous deprivation of such interests

through the procedures used, and the probable

value, if any, of additional or substitute procedu-

ral safeguards; and finally, the government’s in-

terest, including the function involved and the

fiscal and administrative burdens that the addi-

tional or substitute procedural requirement would

entail.” 424 U.S. at 335.

In the present case, there can be no question that

the private interests involved are substantial. As

already noted, not only has the issuance of cessation

orders been determined by the district court to cause

significant monetary losses to mine operators, and loss

of work to their employees, but such orders have had

the effect of driving mining companies completely out

of business. J.S. App.69a-70a. See, Pennsylvania Coal

Co. v. Mahon, supra; R.A. Holhman and Co. v. SEC,

299 F.2d 127 (D.C. Cir.), cert denied, 370 U.S. 911

(1970).

The second factor to be considered under Ma-

thews, the risk of erroneous deprivations, is also

present here. As previously stated, the evidence before

the district court described specific instances in which

cessation orders were issued in an arbitrary and

capricious manner. At trial the Secretary was unable

to show even one instance in which the issuance of a

cessation order was found to be necessary to protect

public health and safety or the environment. The lack

of objective criteria to guide the Secretary’s inspectors

requires them to make and implement purely subjec-

tive decisions.” Where there are no quantifiable guide-

lines upon which to base a summary deprivation of

property, Mitchell v. W.T. Grant Co. 416 U.S. 600

(1974), where there is no provision for prior input by

26 The Secretary relies (Brief 65) on Sink v. Morton, 529 F.2d

601 (4th Cir. 1975) to support the constitutionality of summary

enforcement provisions. However, the enforcement provisions of the

Federal Coal Mine Health and Safety Act of 1969 there at issue

authorize summary withdrawal orders only where the inspector finds

that an “imminent danger” to the lives and safety of the miners in

underground mines exists. This is a quite different type of situation

than one involving possible environmental harm under the Surface

Mining Act.

the operator, Montrym v. Panora, 429 F.Supp. 393

(D.Mass. 1977), and where the governmental action

will effectively paralyze the operation of a business

and drive its operator to the wall, United States v.

Vertol, 545 F.2d 648, 651 (9th Cir. 1976), such a

property deprivation has not been accomplished with

due process of law. Moreover, where the loss cannot

be compensated, the private interest is of such a

magnitude that a pre-hearing taking can rarely be

justified. Stanley v. Illinois, 405 U.S. 646 (1972);

Stypmann vy. City and County of San Francisco, 577

F.2d 1338 (9th Cir. 1977). The existence of each of

these factors in the present case amply demonstrates

that the second element of the Mathews test has been

met.

Finally, Mathews requires that the governmental

interest in question be considered in light of the fiscal

or administrative burdens that other procedural

requirements would entail. This does not negate other

considerations, but does require the court to balance

the competing interests. Generally, a taking without a

prior hearing to advance a valid government purpose

can be justified only in extraordinary circumstances.

Fuentes v. Shevin, 407 U.S. 67 (1972). Where

reasonable alternative means exist, they should be

used. Viandis v. Klein, 412 U.S. 441 (1973).

The Act has not involved such a large number of

summary cessation order cases as would unduly bur-

den the regulatory authority. Thus, unlike the situ-

ation in Mathews, the Secretary would not be con-

fronted with a massive and excessively expensive task

if he were required, as the district court directed, to

afford mine operators a hearing prior to issuance of a

cessation order. Moreover, in similar circumstances.

other federal agencies dealing with matters of safety,

health and environmental protection have been able to

function quite adequately with presanction hearing

requirements. See Federal Water Pollution Control

Act of 1972, 33 U.S.C. 1364; Occupational Safety and

Health Act, 29 U.S.C. 662. Similar procedures, such

as those required by the district court, will adequately

protect the governmental interest asserted under the

Act.

Section 518(c) of the Act also denies mine oper-

ators due process of law because it requires an operator

who desires to contest a civil penalty assessment to

place in escrow with the Secretary the amount of the

assessed penalty in order to obtain any administrative

or judicial review of the alleged violation or the

penalty being proposed therefor. The district court

was not confused, as suggested by the Secretary ( Brief

69), with respect to the nature and the impact or effect

of the prepayment requirement. On the contrary, the

district court recognized that the ‘“refund-with-

interest” provision does not adequately protect oper-

ators because it ties up needed capital and can have

the practical effect of a cessation order. J.S. App.69a-

70a.” The district court understood only too well that

this procedure can be and has been used to pressure

operators to submit to unjustified orders of federal

inspectors in order to avoid tying up scarce resources.

See, Star Coal Co. v. Andrus No. 79-171-2 (S.D. Iowa

Feb. 13, 1980), and Indiana v. Andrus, Nos. IP78-

500-C and IP78-501-C (S.D. Ind. June 10, 1980),

27 The Secretary has characteristically ignored these findings of

the district court when he asserts that prepayment does not impose

“significant burdens on mine operators” because interest on the

prepaid penalty protects mine operators against financial injury.

(Brief 70).

appeal pending No. 80-231, wherein two other district

courts have reached similar conclusions.

Once again, the Secretary (Brief 67-69) has

attempted to confuse the manner in which Section 518

and its implementing regulations operate. The Secre-

tary states that a hearing is provided under his

regulations with respect to the fact of violation without

prepayment of penalty, but he admits that the hearing

cannot involve a contest of the amount of the penalty

unless the assessed amount is prepaid. Such dis-

tinction is of little practical use to a small or medium

sized mine operator whose limited capital can be tied

up for a considerable time without a complete hearing.

Appellees have been unable to discover any pre-

cedent for such a requirement and the Secretary has

cited none. Clearly, the Act is not a revenue-producing

statute. That being the case, no substantial public

purpose is served either by statutory or administrative

requirements which deny operators a full and com-

plete hearing before being required to pay penalties.

CONCLUSION

The questions presented here are constitutional

questions of great magnitude. If the Commerce Clause

is now construed to give the federal government the

power to dictate the terms and conditions under which

the States may permit land to be used for surface coal

mining it is inevitable that similar justification will be

made for extending the reach of that power to other

categories of land use until virtually all State land use

powers are preempted. In a real sense this case

presents the ultimate test of the principles of Feder-

alism, and the continuing role of the States as sover-

eign entities.

Respectfully submitted,

John L. Kilcullen

Kilcullen and Kilcullen

Chartered

1800 M Street, N.W. Suite 600

Washington, D.C. 20036

(202) 296-5700

Counsel for Virginia

Surface Mining and Reclamation

Association, Inc., and the

Town of Wise, Virginia

MARSHALL COLEMAN

Attorney General

ROGER L. CHAFFE

Assistant Attorney General

GREGORY M. LUCE

Assistant Attorney General

Commonwealth of Virginia

This is a copy of a public record, reproduced as it was published. It is not legal advice, and it may not be the version a court would rely on. Check the official source before you cite it.