Petition — Tennessee Water Quality Control Board v. Tennessee Valley Authority

In THE

Supreme Court of the Bnited States

Octoser Term, 1983

TENNESSEE WATER QuALiTy ConTROL Boarp,

EuGENE FowINKLE, COMMISSIONER, TENNESSEE

DEPARTMENT OF Pusiic HEALTH,

Petitioners,

vs.

Unrrep States Or AMERICA, Ex REL.

TENNESSEE VALLEY AUTHORITY AND

TENNESSEE VALLEY AUTHORITY,

Respondents.

PETITION FOR A WRIT OF CERTIORARI

TO THE UNITED STATES COURT OF APPEALS

FOR THE SIXTH CIRCUIT

WiiuiaM M. Lzecn, Jr.

Attorney General and Reporter

State of Tennessee

WiiuaM B. Hussarp

Chief Deputy Attorney General

Frank J. SCANLON

Deputy Attorney General

Micuast D. PEARIGEN

Assistant Attorney General

450 James Robertson Parkway

Nashville, Tennessee 37219

(615) 741-5861

Attorneys for Petitioners

RAO NE A NE SOT TE EN AI

St. Louis Law Printing Co., Inc., 411 No. Tenth Street 63101 314-231-4477

QUESTIONS PRESENTED

1. Can the State of Tennessee exercise its inherent police

power to regulate water pollution or is its authority limited sole-

ly to an authority to administer the National Pollution

Discharge Elimination System pursuant to section 402(b) of the

Federal Clean Water Act, 33 U.S.C. § 1342(b)?

2. Does the waiver of sovereign immunity with respect to

federal facilities in section 313 of the Federal Clean Water Act,

33 U.S.C. § 1323, subject the TVA’s Ocoee Dam No. 2

Hydroelectric Project to State authority, including the permit-

ting requirements of the Tennessee Water Quality Control Act,

T.C.A. § 69-3-101 ef seg.?

3. Was the administrative proceeding by which the State of

Tennessee would have determined the applicability of its water

quality law to TVA’s Ocoee Dam No. 2 Hydroelectric Project

improperly removed to Federal District Court under section 313

of the Federal Clean Water Act?

This Court Needs To Correct An Erroneous And

Unprecedented Ruling Of The Court Of Appeals

Which Seriously Impedes The Ability Of The State

Of Tennessee And Other States Located Within

The Sixth Circuit To Enforce State Environmental

Laws In General And Specifically Against Federal

Facilities

Appendix A: Opinion of the Sixth Circuit Court of

Appeals dated September 23, 1983 and Order De-

nying Petition for Rehearing dated October 20,

Appendix B: Opinion of the District Court for the

Middle District of Tennessee dated April 9, 1982 ..

Appendix C: Relevant Provisions of the Clean Water

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A-17

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Appendix D: Relevant Provision of the Tennessee

Water Quality Control Act). ... 6... cece eee eeees A-33

T.C.A, § GB-3-10B(a)(B) 6. ccc cece ee eeees A-33

Appendix E: 48 Fed.Reg. 45,597, chart at 48,498 (1983) A-35

TABLE OF AUTHORITIES

Cases

County of Nassau v. Cost of Living Council, 499

F.2d 1340 (Temp. Emerg: Ct. of App. 1974)...... 10

National Wildlife Federation v. Gorsuch, 693 F.2d 156

GE SA BO oh ec acdewscpucddotitacnsees dc 5

Ohio v. Wyandotte Chemicals Corporation, 401 U.S.

GED, GOO: BAe vc keh cketuvesessdsk ce cates 6

United States v. Darby, 312 U.S. 100, 124(1941) ...... 6

Volkswagen de Puerto Rico, Inc., v. Puerto Rico Labor

Relations Board, 454 F.2d 38 (ist Cir. 1972) ...... 10

Constitutional Provision

U.S. Constitution, Amendment X..............50055 6

Statutes

Federal:

ORRIN penn co spnecehers stboes jess

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Pa

— —

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33 U.S.C. § 1251(b) (CWA § 101(D)) .. we eee ees 2,6

33 U.S.C. § 1311(a) (CWA § 301 (a)) ... 26. 5

33 U.S.C. § 1319(a) (CWA § 309(a)) .. 6... cece eee 5

33 U.S.C. § 1323(a) (CWA § 313(a)) ... 6... cece e eens 2

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State:

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EE Wa crn cecocscsunsocccousesctoutas 2,8

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Dterls SOPs fo httdscdceccccnacccccovses 3

Miscellaneous

48 Fed. Reg. 45,597, chart at 45,598 (1983) ........... 7

Juergensmeyer, The Tennessee Water Quality Control

Act of 1971: A Significant New Environmental

Statute, 25 Vand.L.Rev. 323, 328 (1972.......... 8

s~

vi

Maloney, The Tennessee Water Quality Control Act of

1971, 25 Vand.L.Rev. 331, 351 (1972) ........... 8

S. Rep. No. 92-414, 92d Cong., 2d Sess., reprinted in

[1972] U.S. Code Cong. and Ad. News, at 373-34 . 9

S. Rep. No. 95-370, 95th Cong., Ist Sess., reprinted in

[1977] U.S. Code Cong. and Ad. News, at 4392 ... 9

No.

In THE

Supreme Court of the United States

Ocroser TERM, 1983

TENNESSEE WATER QUALITY ConTROL BoarD,

EuGENE FoWINKLE, COMMISSIONER, TENNESSEE

DEPARTMENT OF PusLic HEALTH,

Petitioners,

vs.

Unrtep States Or AMERICA, Ex REL.

TENNESSEE VALLEY AUTHORITY AND

TENNESSEE VALLEY AUTHORITY,

Respondents.

PETITION FOR A WRIT OF CERTIORARI

TO THE UNITED STATES COURT OF APPEALS

FOR THE SIXTH CIRCUIT

The Petitioners, Tennessee Water Quality Control Board, et

al., respectfully request a Writ of Certiorari issue to review the

judgment and opinion of the United States Court of Appeals

for the Sixth Circuit, entered in this proceeding on September

23, 1983, and as to which the Petitioners’ Petition for Rehearing

was denied on October 20, 1983.

The opinion of the Court of Appeals (set forth in the Appen-

dix at A-1) is reported at___F.2d__(6th Cir. 1983). The opi-

nion of the Court of Appeals reviews the District Court opinion

(set forth in the Appendix at A-17) which is reported at ___

F.Supp._t__(M.D. Tenn. 1982).

se Ti

JURISDICTION

The Judgment of the Court of Appeals for the Sixth Circuit

was entered on September 23, 1983, the Court’s Order denying

the Petitioners’ Petition for Rehearing (set forth in the Appen-

dix at A-16) was entered on October 20, 1983, and this Petition

for Certiorari was filed within ninety (90) days of the latter date.

This Court’s jurisdiction is invoked pursuant to 28 U.S.C. §

1254(1).

STATUTORY PROVISIONS INVOLVED

This case involves an interpretation of §§ 101(b) (33 U.S.C. §

1251(b)), 313(a) (33 U.S.C. § 1323(a)), 402 (33 U.S.C. § 1342),

and 510 (33 U.S.C. § 1370) of the Federal Clean Water Act, as

those provisions relate to the scope of the State of Tennessee’s

authority to issue state water quality permits pursuant to

T.C.A. § 69-3-108 (formerly T.C.A. § 70-330). The above-

referenced federal statutes are set forth in the Appendix, begin-

ning at A-25. The above-referenced Tennessee statute is set

forth in the Appendix at A-33.

STATEMENT OF THE CASE

This case involves the authority of the State of Tennessee to

apply state water pollution control requirements to federal

facilities by virtue of the waiver of sovereign immunity clause

provided by § 313(a) of the Federal Clean Water Act (CWA), 33

U.S.C. § 1323(a), which provides, in pertinent part:

Each. . .[entity] of the Federal Government (1) having

jurisdiction over any property or facility, or (2) engaged in

any activity resulting, or which may result, in the discharge

or runoff of pollutants, and each officer, agent, or

employee thereof in the performance of his official duties,

shall be subject to, and comply with, all Federal, State, in-

terstate, and local requirements, administrative authority,

and process and sanctions respecting the control and

jv due

onion

abatement of water pollution in the same manner, and to

the same extent as any nongovernmental entity including

the payment of reasonable service charges.

The Tennessee Valley Authority (TVA) owns the Ocoee Dam

No. 2 Hydroelectric Project, consisting of a diversion dam con-

nected downriver to a powerhouse by a wooden flume approx-

imately four and one-half (4%) miles long.' TVA decided in

1979 to reopen its Ocoee Project following completion of

repairs on the flume which had necessitated its closure in 1976.

The Commissioner of the Tennessee Department of Health and

Environment (TDHE), pursuant to the Tennessee Water Quali-

ty Control Act, T.C.A. § 69-3-101 ef seg. (Tennessee Act), in-

formed TVA that operation of the Ocoee Project consituted an

“alteration of the physical, chemical, radiological, biological,

or bacteriological properties of any waters of the State’’, pur-

suant to T.C.A. § 69-3-108(b)(1). Furthermore, he found that

the project constituted the ‘‘development of a natural resource’’

which would result in the alteration of the properties of waters

of the State, pursuant to T.C.A. § 69-3-108(b)(4). Both of these

activities are unlawful without a valid state water quality permit

under T.C.A. § 69-3-108(b). TVA filed an appeal of this deter-

mination to the Tennessee Water Quality Control Board, pur-

suant to T.C.A. § 69-3-118(a){(2).

This administrative appeal was filed and then removed to

oo

those federal facilities which caused the discharge or runoff of

pollutants. The State argued that § 313(a) makes federal ‘‘ac-

tivities’’ resulting in the discharge or runoff of pollutants sub-

ject to State water pollution laws, but that ail federal

**facilities’’ must comply with such State laws, irrespective of

whether they cause a discharge or runoff of pollutants. Alter-

natively, the State argued, and demonstrated by the only proof

in the record, that a discharge of pollutants could be caused by

the Ocoee Dam No. 2 Hydroelectric Project. The District Court

ruled that CWA § 313 removed federal immunity for com-

pliance with state pollution laws only for those federal facilities

resulting in a discharge or runoff of pollutants. Appendix at

A-24. The District Court granted TVA summary judgment

because, in its opinion, the project would merely result in the

diversion of the river, rather than a discharge or runoff of

pollutants. Jd.

On appeal, the Sixth Circuit affirmed the District Court’s

decision. The Court of Appeals concluded that the State ad-

‘ ministrative proceedings ‘‘were removable for the purpose of

determining the federal question of the extent to which Con-

gress had waived sovereignty’’, Appendix at A-15, and thus

declined to decide whether State administrative proceedings are

removable to Federal District Courts as a general matter. The

Court of Appeals then changed direction and explicitly declined

to decide the issue of ‘‘the extent to which Congress had waived

soverciguty’’ over federal facilities in § 313(a), Appendix at

A-15, which was the basis of the District Court decision and the

basis upon which Tennessee applied its law to the Ocoee Pro-

ject. Instead, the Court of Appeals concluded that the State

lacked power to regulate the pollution of its waters except

through the National Pollution Discharge Eliminarion System

established by CWA § 402, 33 U.S.C. § 1342.’

? Section 402 establishes the National Pollution Discharge Elimina-

tion System and provides for a nationwide system of permits, known

as “NPDES” permits, which are required of all entities which

_— eo

The Sixth Circuit, in reaching its decision, reasoned as

follows:

The “pollution” which the Commissioner of the Ten-

nessee Department of Health identified is not subject to

control or abatement by use of the discharge permit

system. The right of the State to require discharge permits

is derived solely from section 402. EPA has consistently

treated dams as nonpoint sources of pollution which are

not subject to the discharge permit requirements of section

402. We agree with the District of Columbia Circuit [refer-

ring to National Wildlife Federation v. Gorsuch, 693 F.2d

156 (D.C. Cir. 1982)] that this interpretation of the Act by

the agency charged with its administration and enforce-

ment is entitled to deference. Since EPA does not require

discharge permits from dam operators under section

402(a), the states may not do so under section 402(b).

Appendix at A-13. The Court of-Appeals thus concluded that

Tennessee could not require TVA to obtain a permit for the

reconstruction and operation of the Ocoee Project. Appendix at

A-13-14,

discharge pollutants into navigable waters. The discharge of

pollutants without an NPDES permit is illegal and subjects the

discharger to various penalties. CWA § 301(a), 33 U.S.C. § wa

and § 30%a), 33 U.S.C. § 131%a). Initial authority to administer the

aay

REASONS FOR GRANTING THE WRIT

This Court Needs To Correct An Erroneous And Un-

precedented Ruling Of The Court Of Appeals Which Seriously

Impedes The Ability Of The State Of Tennessee And Other

States Located Within The Sixth Circuit To Enforce State En-

vironmental Laws In General And Specifically Against Federal

Facilities.

The issues presented by this petition are significant and

potentially far reaching. The primary issue in this case, left

undecided by the Sixth Circuit, is whether the § 313 waiver of

sovereign immunity with respect to federal facilities allows the

State of Tennessee to exercise its inherent police power to

regulate the pollution of its waters; specifically, whether this in-

herent State power can be exercised to require the Ocoee Project

to comply with the Tennessee Act. However, the Sixth Circuit

ignored the State’s inherent police power to regulate pollution

of its waters and instead cast into doubt whether the State can

enforce its state water pollution control requirements in-

dependently of the federal § 402(b) permit requirements.

There is no doubt that Tennessee has the power to prevent the

pollution of its waters. This power is preserved by the Tenth

Amendment to the U.S. Constitution’ and recognized by Con-

gress in CWA § 101(b), 33 U.S.C. § 1251(b), where it expressed

its intent ‘‘To recognize, preserve, and protect the primary

responsibilities and rights of States to prevent, reduce, and

herent. See U.S. Constitution, Amendment X; United States v. Dar-

by, 312 U.S. 100, 124 (1941). In Ohio v. Wyandotte Chemicals Cor-

poration, 401 U.S. 493, 498 n. 3 (1971), the basic “es

law. mand

—

eliminate pollution. . ..’’ Toward this end, CWA § 510(1), 33

U.S.C. § 1370(a), states that nothing in the CWA precludes or

denies the rights of any state to adopt or enforce not only *‘(A)

any standard or limitation respecting discharges of pollutants”

but also ‘‘(B) any requirement respecting control or abatement

of pollution. . ..’’ In addition, CWA § 510(2) states that the

CWA shall not ‘‘be construed as impairing or in any manner af-

fecting any right or jurisdiction of the States with respect to the

waters (including boundary waters) of such States.’’ This State

authority is made applicable to federal entities by CWA § 313.

However, the Court of Appeals concluded that the State’s

power to regulate water pollution is merely an authority

delegated to it pursuant to § 402(b). The Court of Appeals bas-

ed its conclusion on the mistaken premise that Tennessee was

only trying to enforce the federal discharge permit requirement

of § 402 with respect ot the Ocoee Project. See Appendix at A-

11 and A-14. This premise is in error for two (2) reasons. First,

Tennessee, unlike most states, has never been authorized by

EPA to issue § 402 permits for federal facilities.‘

Second, in the present case, the State of Tennessee was enfor-

Act’s original purposes are stated as establishing the State ci

Tennessee’s obligation to protect the right of its people to un-

Control Act is not a creation of nor a vehicle for implementa-

tion of a federal statutory scheme. Indeed, the Tennessee Act

was passed in 1971, the year before Congress created the

NPDES program. It was only after Congress amended the

CWA in 1972 that current T.C.A. § 69-3-102(c) was added,

which states that ‘‘an additional purpose’’ of the Tennessee Act

is to enable the State to participate in the NPDES program.

The Tennessee Act is not only independent of the federal law

but is much more comprehensive. The State water quality per-

mit provided by T.C.A. § 69-3-108 is much broader in scope

than a permit to discharge from a point source.’ For example, a

permit is required under Tennessee law for ‘‘activities’’ which

may constitute an ‘‘alteration’’ of various properties of the

waters of the State or the development of a natural resource

which may result in the alteration of various properties of

waters of the State. See T.C.A. § 69-3-108(b)(1) & (4). The

TDHE found that these conditions would be created by the

operation of TVA’s Ocoee No. 2 Project.

The clear and devastating inference of the Court of Appeals’

decision is that Tennessee’s power to regulate water pollution is

of federal NPDES permits. In the instant case, the Sixth Cir-

cuit’s decision leaves the State powerless to prevent a violation

* A fact noted by several commentators, including Professor

, the drafter of the 1971 Tennessee Act who states that

T.C.A. § 69-3-108(b) ‘‘is intended to provide an omnibus clause mak-

ing it unlawful for any person. . .to alter in any manner the properties

of the waters of the State without securing. . .a permit. . ..”” .

The Tennessee Water Quality Control Act of 1971, 25 Vand.L.Rev.

331, 351 (1972). (Emphasis added). See also Juergensmeyer, The Ten-

——

ma

of its law by TVA’s Ocoee Dam No. 2 Hydroelectric Project.

This erroneous limitation affects Tennessee and every other

state within the Sixth Circuit which enforce state water pollution

control laws. Furthermore, the Sixth Circuit’s interpretation of

the federal-state relationship under the CWA could apply to

other environmental regulatory schemes in which the states and

the federal government form a regulatory partnership. See, e.g.,

Clean Air Act, 42 U.S.C. § 7401 et seg.; Resource Conservation

and Recovery Act, 42 U.S.C. § 6901 ef seg. —

The narrow but important issue argued before the Court of

Appeals, but left undecided by it, is the extent to which Ten-

nessee can apply its water quality control law to TVA’s Ocoee

Project under the federal government’s waiver of sovereign im-

munity provided in CWA § 313. By failing to decide this issue,

the Sixth Circuit defeated the clear Congressional intent that a//

federal facilities, including the Ocoee Project, be subject to the

full scope of Tennessee’s water quality control law as if they

were private citizens.‘

Equally disturbing is the Court of Appeals’ failure to address

Tennessee’s challenge to the improper removal of ad-

ministrative proceedings from the Tennessee Water Quality

Control Board to Federal District Court. Appendix at A-

14-15. The State argued that the removal provision in § 313(a)’

in no way expands existing rights of removal under 28 U.S.C. §

1441 and that State administrtive proceedings are not removable

under 28 U.S.C. § 1441. The Sixth Circuit discussed but declin-

ed to decide whether State administrative proceedings are

removable under 28 U.S.C. § 1441, an issue upon which the

lower federal courts are split." As a practical matter, the Board

was never given an opportunity to determine if the Ocoee pro-

ject was subject to the State’s regulation under the Tennessee

water quality control law and, if so, whether operation of the

project was permissible. Conceivably, the Board could have

resolved these issues in favor of TVA, thus rendering this litiga-

tion unnecessary.

CONCLUSION

Before the Court of Appeals was the narrow but important

question whether CWA § 313 allows the State to apply its laws

‘*respecting the control and abatement of water pollution’’ only

to those facilities causing a discharge or runoff of pollutants, as

” Section 313(a) provides, in pertinent part:

ject pursuant to this section, and any such proceeding may be

samawedl is caveliinnes ebtaamen tne et seq. of Title 28.

* Compare, e.g., County of Nassau v. Cost of Living Council, 499

F.2d 1340 (Temp. Emerg. Ct. of App. 1974), with Volkswagen de

Puerto Rico, Inc., v. Puerto Rico Labor Relations Board, 454 F.2d 38

(ist Cir. 1972). The Court of Appeals noted these and other conflic-

ting cases on this issue, Appendix at A-14-15.

TVA argued or, as the State and EPA itself argued,’ to any

federal facility which causes pollution by whatever means. The

Court of Appeals’ decision instead painted with a broad brush

to strike against the very source of State power. Its decision not

only calls into question the ability of the states to enforce water

pollution according to their own laws, but fails to clarify which

federal facilities Congress intended to subject to State water

pollution laws. Therefore, the petitioners respectfully request a

Writ of Certiorari issue to review the judgment and opinion of

the Sixth Circuit.

* The Ocoee River Council and the United States, on

Se en aD SmaI OND Op Settee Cinta hn Ge

Respectfully submitted,

William M. Leech, Jr.

Attorney General and Reporter

State of Tennessee

William B. Hubbard

Chief Deputy Attorney General

Frank J. Scanlon

Deputy Attorney General

Michael D. Pearigen

Assistant Attorney General

450 James Robertson Parkway

Nashville, Tennessee 37219

(615) 741-5861

Attorneys for Petitioners

-_ 12 —

CERTIFICATE OF SERVICE

I hereby certify that a true and exact copy of the foregoing

Petition has been mailed this the 17th day of January, 1984, to

the below-referenced counsel:

Honorable Rex E. Lee

United States Solicitor General

Department of Justice

Washington, D.C. 20530

Herbert S. Sanger, Jr.

James E. Fox

Robert C. Glinski

Brent R. Marquand

Tennessee Valley Authority

Office of General Counsel

400 Commerce Street

Knoxville, Tennessee 37902

MICHAEL D. PEARIGEN

Assistant Attorney General

APPENDIX

— So

{-»

APPENDIX A

No. 82-5288

UNITED STATES COURT OF APPEALS

FOR THE SIXTH CIRCUIT

United States of America Ex Rel.

Tennessee Valley Authority and

Tennessee Valley Authority,

Plaintiffs-Appellees,

Vv.

Tennessee Water Quality Control

Board, Et Al.,

Defendants-Appellants.

Appeal from the

United States District

Court for the Middle

District of Tennessee.

Decided and Filed September .23, 1983

Before: Edwaids Chief Judge; Lively, Circuit Judge; and

Guy, District Judge.*

Lively, Circuit Judge. The question in this case is whether the

Tennessee Water Quality Control Board may require the Ten-

nessee Valley Authority (TVA) to acquire a state permit for the

reconstruction and operation of a dam and flume on a navigable

* The Honorable Ralph B. Guy, Jr., Judge, United States District

Court for the Eastern District of Michigan, sitting by designation.

_— so

waterway within the State of Tennessee. The case arises under

the Federal Water Pollution Control Act, as amended, com-

monly referred to as the Clean Water Act (the Act), 33 U.S.C. §

1251 et seq. (1976 ed. and Supp. V).

I.

A.

A private power company built a hydroelectric unit on the

Ocoee River in Tennessee in 1913. Water was diverted to the

power plant by the second in a series of three dams on the river.

This dam is referred to as Ocoee No. 2. TVA acquired all three

dams in 1939 and built an additional dam in 1941. Ocoee No. 2

consists of a rock-filled timber crib dam which can divert water

into a wooden flume that leads to a powerhouse approximately

four and one-half miles downstream. The dam does not im-

pound water, but merely diverts it. From the time the project

was put into operation until 1976 the four and one-half miles of

riverbed between the dam and the powerhouse contained very

little water, consisting primarily of seepage through the dam. In

September 1976 TVA shut down the project in order to repair

the dam and the steel support trestles of the flume. As a result

of the shutdown the Ocoee has been allowed to run its natural

course along the streambed and it has provided excellent rafting

and canoeing. Since the stretch of the river between the dam and

the power plant is adjacent to a U.S. Highway the recreational

area has been accessible to large numbers of visitors.'

TVA determined to reopen the Ocoee No. 2 project after

completion of the repairs without allowing for recreational

releases of water into the riverbed between the dam and

' This statement of facts is derived from the district court’s opinion

in a related case. See Ocoee River Council v. T.V.A., 540 F. Supp.

788, 791 (E.D. Tenn. 1981).

a7 <

powerhouse. The decision was made after Congress rejected a

requested appropriation to provide for the loss of revenue from

electricity sales which would result from providing for 82 days

of recreational release of water annually. Suit was filed by the

Ocoee River Council, a non-profit corporation chartered in part

to promote recreational uses of the Ocoee River, a private in-

dividual who uses the river for recreational purposes and a com-

mercial rafting company to enjoin further work on the project

for alleged violation of a number of federal statutes. The district

court found that TVA had prepared an adequate final en-

vironmental impact statement in connection with its decision to

reconstruct Ocoee No. 2. Ocoee River Council v. T.V.A., 540

F.Supp. 788, 795-96 (E.D. Tenn. 1981). However, the court

also found that the decision to proceed with the reconstruction

without any provision for recreational use of the Ocoee River

between the dam and the powerhouse was deficient under the

National Environmental Policy Act (NEPA) and therefore ‘‘not

in accordance with law.’’ 5 U.S.C. § 706(2)(A). 540 F.Supp. at

798. Rather than granting an injunction, however, the district

court stayed the action in order for TVA to reconsider its deci-

sion in light of the NEPA requirements.

After holding several public hearings TVA ratified its

previous decision to rehabilitate the Ocoee No. 2 hydroelectric

facility and directed that it be operated exclusively for power

generation in the absence of some method for ensuring compen-

sation for power losses associated with recreational releases.

The general manager of TVA was granted authority to provide

for approximately 82 days of recreational releases per year upon

development of appropriate compensation arrangements, which

were not limited to appropriations but could include conces-

sion, license or user fees or other sources of funding. The

district court then found that TVA’s decision had been reached

after evaluation of environmental factors as mandated by

NEPA, along with other proper considerations, and granted

TVA’s motion for summary judgment, dismissing the action.

Id. at 800-02.

ay ae

Cc.

The plaintiffs did not appeal the final judgment of the district

court. However, the Ocoee River Council had filed a complaint

with the Commissioner of the Tennessee Department of Public

Health prior to entry of the final judgment by the district court.

This complaint alleged that the Ocoee No. 2 project would

violate the Tennessee Water Quality Control A~* unless TVA

obtained a water quality permit from the State for diversion of

the Ocoee. The commissioner investigated the complaint and by

a letter dated December 11, 1981 advised TVA that he had con-

cluded ‘‘that TVA’s proposed activity requires a State water

quality permit pursuant to T.C.A. 70-330(b)’’ (Tennessee Code

Annotated, Section 70-330(b)). One of the two items which the

commissioner considered in reaching this conclusion was a writ-

ten opinion of the Attorney General of Tennessee. In this opi-

nion the Attorney General concluded that a state permit was re-

quired for Ocoee No. 2 because the United States Environmen-

tal Protection Agency (EPA) had approved Tennessee’s permit

system as contained in the Tennessee Water Quality Control Act

of 1977. The Attorney General pointed out that the authority

for states ‘‘to create, administer, and enforce state permit

systems’’ under the national pollution discharge elimination

system derived from section 402 of the Act, 33 U.S.C. § 1342.

TVA appealed the commissioner’s decision to the Tennessee

Water Quality Control Board and then filed a petition to

remove the proceedings to the federal district court. On the

same day TVA filed a declaratory judgment action in the same

district court and a motion to consolidate it with the removed

action. In the original district court action TVA sought a

declaration that the Tennessee Water Quality Control Board

and the commissioner had no authority to regulate or interfere

with TVA's projected repair and operation of Ocoee No. 2, “*by

requiring a permit or otherwise.”’

a ao

The Tennessee defendants filed a motion to remand the

removed case and 2 motion to dismiss the declaratory judgment

action. In the alternative, if remand were not granted, it filed a

motion to dismiss the consolidated actions or for summary

judgment. The Ocoee River Council filed a motion to intervene

with a motion to remand. However, the district court did not

act on the motion to intervene. This court permitted the Ocoee

River Council to file a brief and to participate in oral argument

as amicus curiae.

The district court granted the motion to consolidate the ac-

tion, but did not rule on the motion to remand the removed ac-

tion. Following extensive briefing the district court granted

TVA’s motion for summary judgment. The district court and

the parties agreed that decision of the consolidated actions

depended primarily on the proper construction of Section 313

of the Act as amended, 33 U.S.C. § 1323 (1976 ed. and Supp.

V), which provides in pertinent part:

§ 1323. Federal facilities pollution control

(a) Each department, agency, or instrumentality of the

executive, legislative, and judicial branches of the Federal

Government (1) having jurisdiction over any property or

facility, or (2) engaged in any activity resulting, or which

may result, in the discharge or runoff of pollutants, and

each officer, agent, or employee thereof in the perfor-

mance of hi: official duties, shall be subject to, and comp-

ly with, all Federal, State, interstate, and local re-

quirements, administrative authority, and process and

sanctions respecting the control and abatement of water

pollution in the same manner, and to the same extent as

any nongovernmental entity including the payment of

reasonable service charges. The preceding sentence shall

apply (A) to any requirement whether substantive or pro-

cedural (including any recordkeeping or reporting require-

ment, any requirement respecting permits and any other

as Abs

requirement, whatsoever), (B) to the exercise of any

Federal, State, or local administrative authority, and (C)

to any process and sanction, whether enforced in Federal,

State, or local courts or in any other manner. This subsec-

tion shall apply notwithstanding any immunity of such

agencies, officers, agents, or employees under any law or

rule of law. Nothing in this section shall be construed to

prevent any department, agency, or instrumentality of the

Federal Government, or any officer, agent, or employee

thereof in the performance of his official duties, from

removing to the appropriate Federal district court any pro-

ceeding to which the department, agency, or instrumentali-

ty or officer, agent, or employee thereof is subject pur-

suant to this section, and any such proceeding may be

removed in accordance with section 1441 et seq. of title 28.

The district court found that section 313 waives federal

sovereignty over only those activities of federal agencies

resulting in the discharge or runoff of pollutants and that Ocoee

No. 2 merely diverts the water from its bed for a short distance,

resulting in no discharge or runoff of pollutants. In reaching its

conclusion the district court pointed out that Ocoee No. 2 has

been operated for many years as an integral part of a unified

dam and reservoir system over which TVA has been given con-

trol by a series of congressional enactments. The court noted

that Ocoee No. 2 was acquired and operated solely for the pro-

duction of hydroelectric power and that Congress had refused

to appropriate funds to replace lost power revenues if water

releases were made for recreational purposes. The district court

summarized its holding in a sentence near the end of its

memoradum opinion. ‘‘The State cannot under the guise of

regulation of discharge or runoff of pollutants exercise the right

of control over a unified federal navigation, flood control and

power operation, where federal sovereignty has been retained.”’

a Po

The state defendants and amicus Ocoee River Council argue

that the district court misconstrued the impact of the words

‘discharge or runoff of pollutants’’ in section 313(a). They

point out that section 313(a) has two subsections. Subsection (1)

requires every department, agency, or instrumentality of the

federal government having jurisdiction over any property or

facility to comply with all regulations — federal, state, in-

terstate and local — respecting the control and abatement of

water pollution in the same manner as any nongovernmental en-

tity. This duty is not modified, the defendants and amicus say,

by a requirement that there be a discharge or runoff of

pollutants. On the other hand, these parties read subsection (2)

to require compliance by federal entities engaged in activities

only if those activities result in the discharge or runoff of

pollutants. Under this construction ‘‘resulting . . . in the

discharge or runoff of pollutants’’ is a condition requiring com-

pliance only when applied to the second category of federal in-

volvement — ‘‘any activity.’’ The requirement of compliance is

absolute with respect to the first category — ‘‘having jurisdic-

tion over any property or facility.”’

In the alternative the defendants argue that even if the district

court’s construction of section 313 is correct Ocoee No. 2 is a

facility ‘‘resulting’’ in discharge or runoff of pollutants. This

argument is based on the broad definition of ‘‘pollution’’ found

in 33 U.S.C. §1361(19). (The term ‘‘pollution’’ means ‘‘the

man-made or man-induced alteration of the chemical, physical,

biological and radiological integrity of water’’). It is clear that

federal agencies are subject to the procedural as well as the

substantive provisions of programs respecting the control and

abatement of water pollution. Since the Tennessee permit re-

quirement is part of its approved water quality control program,

it follows that TVA must obtain a state permit before pro-

aS an

ceeding with any project which will alter the composition of the

Ocoee River waters, the defendants and Ocoee River Council

argue.

TVA asserts that Congress provided for the unified develop-

ment and control of the Tennessee River System by TVA and

that the State of Tennessee has no authority to regulate its ac-

tivities in the absence of express congressional consent thereto.

TVA finds no such consent in section 313, contending that it ap-

plies only to runoff and ‘‘point source’’ discharge of pollutants.

A dam which merely diverts the water of a river, adding no

foreign substance and creating no runoff, is not subject to any

state requirement, according to TVA. It relies on various defini-

tions contained in section 502 of the Act, 33 U.S.C. § 1362:

(6) The term ‘‘pollutant’’ means dredged spoil, solid

waste, incinerator residue, sewage, garbage, sewage

sludge, munitions, chemical wastes, biological materials,

radioactive materials, heat, wrecked or discarded equip-

ment, rock, sand, cellar dirt and industrial, municipal, and

agricultural waste discharged into water.

(12) The term ‘‘discharge of a pollutant’’ and the term

‘‘discharge of pollutants’’ each means (A) any addition of

any pollutant to navigable waters from any point source,

(B) any addition of any pollutant to the waters of the con-

tiguous zone or the ocean from any point source other than

a vessel or other floating craft.

(14) The term ‘‘point surce’’ means any discernible, con-

fined and discrete conveyance, including but not limited to

any pipe, ditch, channel, tunnel, conduit, well, discrete

fissure, container, rolling stock, concentrated animal

—_*

feeding operation, or vessel or other floating craft, from

which pollutants are or may be discharged. This term does

not include return flows from irrigated agriculture.

(16) The term ‘‘discharge’’ when used without qualifica-

tion includes a discharge of a pollutant, and a discharge of

pollutants.

TVA relies in particular on the use of the word ‘‘addition’’ in

both subsections of 33 U.S.C. § 1362(12), supra, and asserts

there is no claim that the diversion at Ocoee No. 2 adds any

pollutants to the river.

The state defendants also argue that a 1977 amendment to

section 313 made it clear that a broad waiver of sovereign im-

munity was intended by Congress. TVA maintains that the 1977

amendment did not change the extent to which section 313 waiv-

ed immunity from state or local control; it merely made it clear

that where federal agencies are subject to state or local regula-

tion they must comply with state or local procedural as well as

substantive requirements. The qualifying phrase, ‘‘resulting, or

which may result, in the discharge or runoff of pollutants’’ ap-

peared in 1972 version and was unchanged by the 1977 amend-

ment to section 313. We agree with TVA’s interpretation of the

1977 amendment. This amendment was designed to make it

clear that federal agencies are subject to procedural as well as

substantive provisions of state water quality control laws. It was

adopted, at least in part, in response to EPA v. California ex

rel. State Water Resources Control Board, 426 U.S. 200 (1976),

in which the Supreme Court held that federal facilities were re-

quired to comply with state substantive requirements only. See

S. Rep. No. 95-370, p. 67, reprinted in [1977] U.S. Code Cong.

& Adm. News 4392.

—_—~

Cc.

EPA was permitted to file a brief and to participate in oral

argument. Its position is that the district court erred in con-

cluding that section 313 is not applicable to federal dam

operators. It argues, in agreement with the defendants and the

Ocoee River Council, that ‘‘discharge or runoff of pollutants’’

in section 313 modifies ‘‘activities’’ only and that federal pro-

perty and facilities are subject to state regulation without regard

to whether they ‘‘result’”’ in discharge or runoff of pollutants.

However, EPA contends, the Tennessee authorities erred in

treating Ocoee No. 2 as a ‘“‘point source’’ which required a

discharge permit for its continued operation. Instead the State

should have treated the project as a ‘‘nonpoint source’’ of

pollution. It relies on a definition in 33 U.S.C. § 1314(f)(2)(F) of

nonpoint sources of pollution as pollution resulting from —

(F) changes in the movement, flow, or circulation of any

navigable waters or ground waters, including changes caus-

ed by the construction of dams, levees, channels,

causeways, or flow diversion facilities.

EPA argues that the State must deal with nonpoint sources of

pollution under section 208 of the Act, 33 U.S.C. § 1288, a com-

prehensive statutory scheme for identifying areas having

substantial water quality control problems and providing for

federally funded areawide waste treatment management by the

states. EPA acrees with TVA that section 313 does not give the

Tennessee Water Quality Control Board authority to utterly

frustrate the agency’s congressionally mandated hydroelectric

operations by altering the use of Ocoee No. 2 to assure an ade-

quate flow of water for recreational rafting below the dam.

EPA states in its brief, ‘“The State’s authority under Section 313

is limited to establishing reasonable water pollution controls

that are not inconsistent with the purposes for which Ocoee

Dam No. 2 was purchased.”’

— A-ll —

This case must be decided on the basis of the Clean Water Act

in its entirety, not merely on a construction of section 313. The

clear purpose of that section is to make federal agencies subject

to applicable state and local reguirements, procedural as well as

substantive, respecting the control and abatement of water

pollution. However, the authority of the states over navigable

waters is limited by other provisions of the Act.

One of the primary objectives of the Act, as stated in section

101, 33 U.S.C. § 1251(a){1), is to achieve a national goal ‘‘that

the discharge of pollutants into the navigable waters be

eliminated by 1985.’’ The Act seeks to achieve this particular

objective by creating a national pollutant discharge elimination

system (NPDES) based on the issuance of permits for the

discharge of pollutants. Under section 402(a)(2) of the Act, 33

U.S.C. § 1342(a)(2), the Administrator of EPA is required to

prescribe the conditions and other requirements of the Act. Sec-

tion 402(b), 33 U.S.C. § 1342(b), permits a state to administer

its own permit program for discharges into navigable waters

within its jurisdiction upon approval of the program by EPA.

Here Tennessee relied specifically on its permit program ap-

proved by EPA pursuant to § 402 as the basis of its attempt to

regulate the diversion of water at Ocoee No. 2.

EPA has consistently taken the position that the section 402

permit system does not apply to dams because they are ‘‘non-

point sources’’ of pollution, rather than dischargers of

pollutants. In National Wildlife Federation v. Gorsuch, 693

F.2d 156 (D.C. Cir. 1982), an envoronmental group sought a

declaration that the Administrator of EPA had a nondiscre-

tionary duty to require dam operators to apply for pollutant

discharge permits under section 402(a) of the Act. The plaintiff

argued that any adverse change in the quality of reservoir water

from its natural state involves a “‘pollutant,”’ and release of

— A-12 —

such water through a dam into the downstream river is an ‘‘ad-

dition of a pollutant’’ from a point source. EPA contended that

for addition of a pollutant to occur within the definition in sec-

tion 502(12) the point source must introduce the pollutant into

the water. Although alterations in the properties of the water

are ‘‘pllution’’ under the broader definition contained in section

502(19) (‘‘the man-made or man-induced alteration of the

chemical, physical, biological and radiological integrity of the

water’’), all alterations do not fit the narrower definition of

**pollutants’’ contained in section 502(6) (‘‘dredged spoil, solid

waste, incinerator residue, sewage, garbage, sewage sludge,

munitions, chemical wastes, biological materials, radioactive

materials, heat, wrecked or discarded equipment, rock, sand,

cellar dirt and industrial, municipal and agricultural waste

discharged into water’’). Since the section 402 permit system ap-

plies only to the discharge of pollutants EPA argued that it was

not directed by the Act to require dam operators to obtain per-

mits.

The court in National Wildlife Federation concluded that

EPA’s construction of the Act is entitled to considerable

deference. Its treatment of dai~s as nonpoint sources of pollu-

tion was found to represent a considered decision which was

reasonable when the purposes and objects of the Act are con-

sidered. The court agreed with EPA that Congress had treated

‘*pollutants”’ and ‘‘pollution’’ differently and that section 402 is

concerned with the addition of pollutants, not with water pollu-

tion generally. It quoted with approval from Missouri ex. rel.

Ashcroft v. Department of the Army, 672 F.2d 1297, 1304 (8th

Cir. 1982), a case relied on by the district court in the present

case:

**[T)he discharge of a pollutant requires an ‘addition’ of a

pollutant from a ‘point source’ and neither term applie{s}

to soil erosion or the oxygen content of water."

693 F.2d at 175. The court in National Wildlife Federation

pointed out that Congress viewed the NPDES program as the

— A-13 —

most effective weapon against pollution, yet limited its applica-

tion to situations involving the addition of pollutants from

point sources. Water pollution arising from nonpoint sources is

to be dealt with differently, specifically through the device of

areawide waste treatment management by the states. Similar

conclusions were reached in South Carolina Wildlife Federation

v. Alexander, No. 76-2167-2 (D.S.C. April 26,

1982)(unreported decision).

The present case is unusual. The defendants and Ocoee River

Council are not concerned with the operation of the power plant

or the condition of the water returned to the river after it has

been used for the production of electricity. Their only claim is

that the comparatively smali quantity of water which seeps

through the dam is ‘‘polluted’’ by changes in its physical and

chemical properties occurring while it flows through the four

and one-half miles of riverbed between the dam and the power

plant. There is no claim that any pollutants as defined in the Act

are added to the river water by the diversion into or through the

flume.

The ‘‘pollution’’ which the Commissioner of the Tennessee

Department of Health identified is not subject to control or

abatement by use of the discharge permit system. The right of

the State to require discharge permits is derived solely from sec-

tion 402. EPA has consistently treated dams as nonpoint

sources of pollution with are not subject to the discharge permit

requirements of section 402. We agree with the District of Col-

umbia Circuit that this interpretation of the Act by the agency

charged with its administration and enforcement in entitled to

deference. Since EPA does not require discharge permits from

dam operators under section 402(a), the states may not do so

under section 402(b). Accordingly, we affirm the judgment of

the district court ia its holding that Tennessee could not require

TVA to obtain a permit for the reconstruction and operation of

Ocoee No. 2.

= Apt

Our decision does not mean that we adopt the construction of

section 313 urged upon us by TVA and followed by the Eighth

Circuit which held that a federal agency is subject to state water

quality control laws only if it is causing a discharge or runoff of

pollutant. See Missouri ex rel. Ashcroft v. Department of the

Army, supra, 672 F.2d at 1304. We merely hold that a state may

not subject a federal agency to the requirements of its discharge

permit program when the pollution complained or does not

result from the discharge of pollutants from a point source. A

dam, as a nonpoint source, may be subject to some state or local

regulation as part of a section 208 areawide waste treatment

management program. We do not undertake to determine the

limits of such authority in this case since the state sought only to

require a permit under authority derived from section 402.

Cc.

The defendants and amici curiae have argued that, regardless

of our decision in the declaratory judgment action, we should

reman ihe removed proceedings to the Tennessee Water Quali-

ty Control Board to complete its administrative consideration of

the complaint which precipitated this litigation. They argue that

removal under 28 U.S.C. § 1441 applies only to state court ac-

tions, not to administrative proceedings. There is support in

case law for this administrative: proceedings are subject to

removal. Compare County of Nassau v. Cost of Living Council,

499 F.2d 1340 (Temp. Emerg. Ct. of App. 1974)), and Califor-

nia Packing Corp. v. I1.L.W.U. Local 142, 253 F.Supp. 597

(D.Hawaii 1966), with Volkswagen de Puerto Rico, Inc. v.

Puerto Rico Labor Relations Board, 454 F .2d 38 (ist Cir. 1972);

Floeter v. C.W. Transport, Inc., $97 F.2d 1100 (7th Cir. 1979)

(per curiam), and United States v. Pennsylvania Environmental

Hearing Board, 377 F.Supp. 545 (M.D. Pa. 1974).

We do not consider it necessary to decide whether ad-

ministrative proceedings are removable generally. Section 313

expressly preserves to federal agencies the right to remove to an

sip ai aie

appropriate district court “‘any proceeding’’ to which it is sub-

ject thereunder. Since the Tennessee Water Quality Control

Board was relying on section 313 in seeking to require TVA to

obtain a permit we believe its proceedings were removable for

the purpose of determining the federal question of the extent to

which Congress had waived sovereignty. Even if the proceedings

were improperly removed, however, a remand would be

pointless in view of our decision in the declaratory judgment ac-

tion.

The judgment of the district court is affirmed. No costs are

allowed. Each party will pay its own costs on appeal.

— A-16 —

NO. 82-5288

UNITED STATES COURT OF APPEALS

FOR THE SIXTH CIRCUIT

United States Of America Ex Rel. Tennessee

Valley Authority and Tennessee Valley Authority

Plaintiffs-Appellees

v.

Tennessee Water Quality Control Board, Et Al.

Defendants-Appellants

ORDER

(Filed Oct. 20, 1983)

BEFORE: LIVELY, Chief Judge; EDWARDS, Circuit Judge;

and GUY, District Judge.*

Upon consideration of the petition for rehearing filed herein

by the defendants-appellants the court concludes that the issues

raised in the petition were fully considered and correctly decided

upon the original submission and decision of this case and thai

the panel did noi misapprehend the facts or the issues. Accor-

dingly, the petition for rehearing is denied.

ENTERED BY ORDER OF THE COURT

/s/ John P. Hehman

Clerk

* The Honorable Ralph B. Guy, Jr., Judge, U.S. District Court for

the Eastern District of Michigan, sitting by designation.

we Anh? on

APPENDIX B

UNITED STATES DISTRICT COURT FOR THE

MIDDLE DISTRICT OF TENNESSEE

NASHVILLE DIVISION

No. 82-3031

No. 82-3030

United States of America

vs.

Tennessee Water Quality Control Board, Et Al.

MEMORANDUM

(Filed April 9, 1982)

This case involves the application of § 313 of the Clean Water

Act, 33 U.S.C. § 1323, to one of the Tennessee Valley Authority

installations. Jurisdiction is asserted under 28 U.S.C. §§ 1331,

1337 and 1345. The facts are agreed as follows:

Ocoee No. 2 is located on the Ocoee River, a tributary of the

Hiwassee, in southeastern Tennessee. It consists of a rock-filled

and concrete-covered timber crib diversion dam at river mile

24.2, a powerhouse at river mile 19.7, and a 4.6-mile wooden

flume. Water from behind the dam is diverted into the flume, in

which it is carried to a point above, and then down to, the

powerhouse where it is used to generate electric power.

Ocoee No. 2 was built in 1912-13 by the East Tennessee

Power Company, a predecessor of the Tennessee Electric Power

Company (Tennessee Electric Power). In 1939, TVA entered in-

to a contract with the Commonwealth and Southern Corpora-

tion (a holding company which controlled Tennessee Electric

Power) and others, which provided for federal purchase of Ten-

nessee Electric Power’s generating and transmission properties

— A-18 —

including Ocoee No. 2, and the purchase by various

municipalities and cooperatives of its distribution properties.

Consumation of the contract was dependent on congressional

approval. Specific congressional approval was given by the ad-

dition to the TVA Act of section 15c, 53 Stat. 1083 (1939), 16

U.S.C. § 831n-3 (1976). Section 15¢c authorized TVA to use up

to $46 million of proceeds from the sale of government-

guaranteed bonds ‘‘for the purchase of electric utility properties

of the Tennessee Electric Power Company and Southern Ten-

nesee Power Company, as contemplated in the contract between

[TVA] and the Commonwealth and Southern Corporation and

others, dated as of May 12, 1939.’’

As provided by the contract, Ocoee No. 2, like all of the other

real property included in the federal portion of the purchase,

was thereafter conveyed to the United States of America in con-

formity with section 4(h) of the TVA Act, 16 U.S.C. § 83ic(h)

(1976). Section 4(h) provides that ‘‘in the purchase of any real

estate [for the TVA program]. . .the title to such real estate shall

be taken in the name of the United States of America, and

thereupon all such real estate shall be entrusted to [TVA] as the

agent of the United States to accomplish the purposes of this

[Act].””

Following such conveyance, Ocoee No. 2 became and has

been operated as an integral part of the TVA unified dam and

reservoir system. Ocoee No. 2 dam has no storage capacity;' its

purpose is simply to divert water from the stream into the

flume. The amount of water available at Ocoee No. 2 is

regulated by the operation of Blue Ridge Dam and, to a much

lesser extent Ocoee No. 3 dam, upstream. Blue Ridge Dam is

located at river mile 51.3 in the State of Georgia and has 183,000

acre-feet of storage capacity. It was acquired by the United

States under the same 1939 contract and conveyance by which it

' TVA Technical Report No. 5, The Hiwassee Valley Projects, vol.

2, at 40 (1948).

~~ A-19 ~

acquired Ocoee No. 2. Ocoee No. 3 dam is located at river mile

29.2 in Tennessee and has 9,100 acre-feet of storage capacity. It

was built by TVA with money appropriated for that purpose by

Congress, 55 Stat. 597 (1941); 56 Stat. 418 (1942). As in the case

of Ocoee No. 2, the powerhouse at Ocoee No. 3 is located more

than 4 river miles below the dam, and the river waters are

similarly diverted except that the diversion is through a concrete

tunnel rather than a wood flume.

In 1976, operation of Ocoee No. 2 was temporarily suspended

because deterioration of the steel trestles supporting the flume

caused a safety hazard. While it has been so shut down, water

which would ordinarily have been diverted through the flume

has flowed past the dam instead. The resulting stretch of water

immediately below the dam, which is easily accessible from a

nearby highway, has been extensively used during this period

for recreational rafting. This in turn has led to the provision of

commercial raft rentals and related commercial services.

After the shutdown, TVA made extensive studies, including

preparation of an environmental impact statement (EIS),

relating to the cost and desirability of repairing Ocoee No. 2 (in-

cluding rebuilding the flume, which deteriorated during the

shutdown, and some work on the dam) and returning it to

operation. On the basis of these studies, TVA concluded that

Ocoee No. 2 is a valuable power asset which can and should be

repaired and returned to operation as a part of TVA’s power

system.’ TVA also concluded that it was precluded from wholly

* Section 14 of the TVA Act, 16 U.S.C. § 831m (1976), provides for

by a

1945 TVA Ann. Rep. 233-35; 1946 TVA Ann. Rep. 89. The bonds

issued under section 15c of the TVA Act to finance federal purchase

i Ras

or partially diverting a power asset such as Ocoee No. 2 to a

nonpower use such as recreational rafting unless the TVA power

system was compensated for the power lost thereby. The basis

for such preclusion was section 9a of the TVA Act, 16 U.S.C. §

83ih-1 (1976), and a Basic Bond Resolution which TVA

adopted in 1960 under express authority contained in the 1959

revenue bond amendment to the TVA Act, 16 U.S.C. § 831n-4

(1976; Supp. IV, 1980), and which constitutes by its own terms a

contract between TVA and the holders of its bonds. TVA fur-

ther concluded that some recreation releases of water from

behind Ocoee No. 2 dam would be desirable if, but only if, the

power system were so reimbursed, and that a congressional ap-

propriation of the necessary funds would be a practicable

method of providing such reimbursement (if Congress regarded

recreational rafting as warranting an appropriation).

Such an appropriation was sought and denied—first by the

House Appropriations Committee in connection with TVA’s

fiscal year 1981 budget, and again by the Office of Management

and Budget (OMB) in refusing to include a request for such

funds in the overall federal budget submitted by the President

for fiscal year 1982. Both the House Appropriations Committee

and OMB expressed the view that the funds needed to reimburse

the power system for recreation releases should be provided by

recreation users themselves through a system of user fees, and

OMB indicated its willingness to support legislation providing

for such fees if legislation were necessary. See Hearings Before a

Subcom. of Energy and Water Development, 96th Cong., 2d

Sess. 974 (1980); H.R. Rep. No. 96-1093, 96th Cong., 2d Sess.

150 (1980).

On March 6, 1981, the Ocoee River Council, an organization

formed by various commercial rafting interests and noncom-

mercial rafters, and two other parties, one a commercial rafting

company and the other an individual rafter, brought an action

in the United States District Court for the Eastern District of

— A-21 —

Tennessee, Southern Division, No. 1-81-100, seeking an injunc-

tion prohibiting such repair and restoration to service. Plaintiffs

alleged that such repair and restoration would violate the Na-

tional Environmental Policy Act (NEPA), 42 U.S.C. §§ 4321 ef

seq. (1976; Supp. III, 1979); the Federal Water Pollution Con-

trol Act, 33 U.S.C. §§ 1251 et seg. (1976; Supp. III, 1979); por-

tions of the Administrative Procedure Act (APA), 5 U.S.C. §§

701 et seq. (1976); the Fish and Wildlife Coordination Act, 16

U.S.C. §§ 661 ef seg. (1976), and a section of the Outdoor

Recreation Act, 16 U.S.C. § 4601 (1976).

On June 9, 1981 the court (Chief Judge Frank W. Wilson)

issued an order, with an accompanying memorandum, holding

plaintiffs’ contentions as to the Federal Water Pollution Con-

trol Act, the Fish and Wildlife Coordination Act, and the Out-

door Recreation Act to be without merit and granting TVA’s

motion for summary judgment with respect to those conten-

tions. On the NEPA and APA claims, the court held that

TVA’s EIS for Ocoee No. 2 was adequate, but that TVA had

violated NEPA by assuming that recreation releases could not

legally be made from Ocoee No. 2 unless the power program

were reimbursed for resulting losses in power generation. It ac-

cordingly ordered that TVA reconsider its decision in light of

NEPA ‘‘without excluding recreational releases of water absent

separate funding for such releases,’’ and that it report the

results of its reconsideration to the court within 90 days. In so

doing, the court stayed plaintiffs’ request for a preliminary in-

junction restraining TVA’s continued work on Ocoee No. 2,

and noted in the memorandum accompanying its order that:

In reviewing the TVA’s decision ... this Court may not

substitute its judgment for that of the agency... . So long

as the Agency complies with its obligation under NEPA to

incorporate environmental concerns into its decision-

making, the ultimate decision on each project belongs to

the agency.

sti iA i

Turning ... to the issue of the [probability of] the ultimate

success of the plaintiffs in obtaining a full retirement of the

Ocoee No. 2 project, it should be noted that the alternative

of not reconstructing Ocoee No. 2 and of retiring the pro-

ject was rejected by the final EIS. It would appear,

therefore, that when the TVA reconsiders its decision upon

Ocoee No. 2 with due regard for its obligations under

NEPA, it is unlikely that the TVA would adopt this alter-

native. The Court concludes, therefore, that the plaintiffs

have little prospect of ultimately obtaining a complete

cessation of work on the project [memorandum at 15, 18;

emphasis the court’s].

The TVA Board, following reconsideration on the basis

directed by the court, concluded on September 2, 1981, that

Ocoee No. 2 should be restored to service; recreation releases

without reimbursement to the power system would be

undesirable and productive of public detriments which would

outweigh any benefits to recreation; and the project should be

operated for power, with recreation releases for 82 days per year

if, but only if, a method—such as concession, license, or user

fees—could be developed to assure reimbursement to the power

system. TVA so reported to the court, and also asked that the

court reconsider, in the light of section 9a of the TVA Act and

TVA’s Basic Bond Resolution, the portion of its memorandum

which had indicated that total or partial diversion of the project

to recreation at the expense of power would have been proper

had TVA found—as it did not—that such diversion would be

desirable. The issues involved were briefed and, on February 11,

1982, orally argued, after which the court took the matter under

advisement.

Two weeks after TVA’s September 2, 1981, determination,

the Ocoee River Council filed a complaint with the Commis-

sioner, Tennessee Department of Health, alleging that TVA’s

restoration of Ocoee No. 2 to service for generation of power

will violate the Tennessee Water Quality Control Act. The com-

— A-23 —

plaint did not state or suggest that TVA’s plans involve the

discharge of any foreign substance into the waters of the Ocoee

River. Rather, it claimed that diversion of such waters through

the restored flume would itself constitute a ‘‘degradation of

these high quality recreation waters’’; that TVA’s determination

to utilize Ocoee No. 2 for power purposes, unless power is reim-

bursed for generation lost through its partial diversion to recrea-

tion use, represents an ‘‘assert[ion] that it, not the people of

Tennessee, is the owner of the river,’’ in violation of ‘‘that por-

tion of the [Tennessee Water Quality Control] Act which pro-

vides that ‘the waters of Tennessee are the property of the state

and are held in public trust for the use of the people of the

state’’’; and that TVA’s plans to use the water for power

generation violates ‘‘the entire intent of the Act which seeks to

make the fullest use of the water resources of Tennessee.’’

On September 21, 1981, the Commissioner addressed a letter

to TVA which stated that ‘‘the Commissioner will be in-

vestigating this complaint and you will be notified of his deter-

mination as soon as it is made,’’ and that ‘‘[yjour appeal

privileges are to the Water Quality Control Board.”’

Thereafter, on December 11, 1981, the Commissioner sent

TVA a letter with which he enclosed a technical report by his

department’s Division of Water Quality Control and an opinion

by the Tennessee Attorney General. The letter stated that he had

“carefully evaluated both of the enclosed documents and

find[s] that TVA’s proposed activity requires a State water

quality permit.’’ The stated reasons for the finding were that

**TVA’s proposed diversion of the waters of the Ocoee River

will constitute an ‘...alteration of the physical, chemical,

radiological, biological, or bacteriological properties of

.. waters of the State’ ’’; ‘“TVA’s use of the diverted water to

generate electricity at Powerhouse No. 2 constitutes ‘[tJhe

development of a natural resource...’’’; and ‘T.C.A.

70-330(>) makes either of these activities unlawful unless it is

carried out in accordance with the conditions of a valid

permit.’’ The letter further advised that TVA could appeal to

—_ pe

the Tennessee Water Quality Control Board within 30 days

from its receipt of the letter.

During such 30-day period, TVA filed an appeal, removed it

to this court, and filed the separate declaratory judgment action

with which the appeal has been consolidated.

It is TVA’s basic position that (1) the state and its officials

have no authority to regulate or control federal action relating

to the unified development of the Tennessee River system except

to the extent Congress has expressly consented thereto, and (2)

Congress has not consented to the regulation or control here in-

volved.

The defendants submit that § 313 of the Clean Water Act re-

quires the TVA to comply with state requirements respecting

control and abatement of pollution. In other words, does that

section waive the sovereign immunity otherwise possessed by the

United States of America through the TVA. The statutory

language is that each instrumentality of the executive branch of

government engaging in any activity ‘‘resulting, or which may

result, in the discharge or runoff of pollutants’’ shall be subject

to State requirements, etc. The key words are ‘‘discharge or

runoff of pollutants.’’ The State cannot under the guise of

regulation of discharge or runoff of pollutants exercise the right

of control over a unified federal navigation, flood control and

power operation, where federal sovereignty has been retained.

Here there is solely a question of diversion. There is no

discharge nor runoff of pollutants. Regardless of the desirabili-

ty of recreational rafting, that issue is not present. The strained

construction that somehow this diversion of water for a distance

of 4.6 miles, passing through a flume, constitutes a discharge or

runoff of pollutants is not impressive.

The motion of TVA for a summary judgment is sustained.

The motion of the defendant is denied. An order will be

entered.

/s/ L. Clure Morton

Chief Judge

— A-25 —

APPENDIX C

Federal Clean Water Act Provisions

§1251. Congressional declaration of goals and policy

(b) It is the policy of the Congress to recognize, preserve, and

protect the primary responsibilities and rights of States to pre-

vent, reduce, and eliminate pollution, to plan the development

and use (including restoration, preservation, and enhancement)

of land and water resources, and to consult with the Ad-

ministrator in the exercise of his authority under this chapter. It

is the policy of Congress that the States manage the construc-

tion grant program under this chapter and implement the permit

programs under sections 1342 and 1344 of this title. It is further

the policy of the Congress to support and aid research relating

to the prevention, reduction, and elimination of pollution, and

to provide Federal technical services and financial aid to State

and interstate agencies and municipalities in connection with the

prevention, reduction, and elimination of pollution.

§ 1323. Federal facilities pollution control

(a) Each department, agency, or instrumentality of the ex-

ecutive, legislative, and judicial branches of the Federal Govern-

ment (1) having jurisdiction over any property or facility, or (2)

engaged in any activity resulting, or which may result, in the

discharge or runoff of pollutants, and each officer, agent, or

employee thereof in the performance of his official duties, shall

be subject to, and comply with, all Federal, State, interstate,

and local requirements, administrative authority, and process

and sanctions respecting the control and abatement of water

pollution in the same manner, and to the same extent as any

nongovernmental entity including the payment of reasonable

“

— A-26 —

service charges. The preceding sentence shall apply (A) to any

requirement whether substantive or procedural (including any

recordkeeping or reporting requirement, any requirement

respecting permits and any other requirement, whatsoever), (B)

to the exercise of any Federal, State, or local administrative

authority, and (C) to any process and sanction, whether enforc-

ed in Federal, State, or local courts or in any other manner. This

subsection shall apply notwithstanding any immunity of such

agencies, officers, agents or employees under any law or rule of

law. Nothing in this section shall be construed to prevent any

department, agency, or instrumentality of the Federal Govern-

ment, or any officer, agent, or employee thereof in the perfor-

mance of his official duties, from removing to the appropriate

Federal district court any proceeding to which the department,

agency, or instrumentality or officer, agent, or employee

thereof is subject pursuant to this section, and any such pro-

ceeding may be removed in accordance with section 1441 et seq.

of Title 28. No officer, agent, or employee of the United States

shall be personally liable for any civil penalty arising from the

performance of his official duties, for which he is not otherwise

liable, and the United States shall be liable only for those civil

penalties arising under Federal law or imposed by a State or

local court to enforce an order or the process of such court. The

President may exempt any effluent source of any department,

agency, or instrumentality in the executive branch from com-

pliance with any such a requirement if he determines it to be in

the paramount interest of the United States to do so; except that

no exemption may be granted from the requirements of section

1316 or 1317 of this title. No such exemptions shall be granted

due to lack of appropriation unless the President shall have

specifically requested such appropriation as a part of the

budgetary process and the Congress shall have failed to make

available such requested appropriation. Any exemption shall be

for a period not in excess of one year, but additional exemptions

may be granted for periods of not to exceed one year upon the

President’s making a new determination. The President shall

- ll —

report each January to the Congress all exemptious from the re-

quirements of this section granted during the preceding calendar

year, together with his reason for granting such exemption. In

addition to any such exemption of a particular effluent source,

the President may, if he determines it to be in the paramount in-

terest of the United States to do so, issue regulations exempting

from compliance with the requirements of this section any

weaponry, equipment, aircraft, vessels, vehicles, or other

classes or categories of property, and access to such property,

which are owned or operated by the Armed Forces of the United

States (including the Coast Guard) or by the National Guard of

any State, and which are uniquely military in nature. The Presi-

dent shall reconsider the need for such regulations at three-year

intervals.

§ 1342. National pollutant discharge elimination system

Permits for discharge of pollutants

(a1) Except as provided in sections 1328 and 1344 of this ti-

tle, the Administrator may, after opportunity for public hear-

ing, issue a permit for the discharge of any pollutant, or com-

bination of pollutants, notwithstanding section 1311(a) of this

title, upon condition that such discharge will meet either all ap-

plicable requirements under sections 1311, 1312, 1316, 1317,

1318, and 1343 of this title, or prior to the taking of necessary

implementing actions relating to all such requirements, such

conditions as the Administrator determines are necessary to

carry out the provisions of this chapter.

(2) The Administrator shall prescribe conditions for such per-

mits to assure compliance with the requirements of paragraph

(1) of this subsection, including conditions on data and infor-

mation collection, reporting, and such other requirements as he

deems appropriate.

—

(3) The permit program of the Administrator under

paragraph (1) of this subsection, and permits issued thereunder,

shall be subject to the same terms, conditions, and requirements

as apply to a State permit program and permits issued

thereunder under subsection (b) of this section.

(4) All permits for discharges into the navigable waters issued

pursuant to section 407 of this title, shall be deemed to be per-

mits issued under this subchapter, and permits issued under this

subchapter shall be deemed to be permits issued under section

407 of this title, and shall continue in force and effect for their

term unless revoked, modified, or suspended in accordance with

the provisions of this chapter.

(5) No permit for a discharge into the navigable waters shall

be issued under section 407 of this title after October 18, 1972.

Each application for a permit under section 407 of this title,

pending on October 18, 1972, shall be deemed to be an applica-

tion for a permit under this section. The Administrator shall

authorize a State, which he determines has the capability of ad-

ministering a permit program which will carry out the objective

of this chapter, to issue permits for dischages into the navigable

waters within the jurisdiction of such State. The Administrator

may exercise the authority granted him by the preceding

sentence only during the period which begins on October 18,

1972, and ends either on the ninetieth day after the date of the

first promulgation of guidelines required by section 1314(h\(2)

of this title, or the date of approval by the Administrator of a

permit program for such State under subsection (b) of this sec-

tion, whichever date first occurs, and no such authorization to a

State shall extend beyond the last day of such period. Each such

permit shall be subject to such conditions as the Administrator

determines are necessary to carry out the provisions of this

chapter. No such permit shall issue if the Administrator objects

to such issuance.

— A-29 —

State permit programs

(b) At any time after the promulgation of the guidelines re-

quired by subsection (h)(2) of section 1314 of this title, the

Governor of each State desiring to administer its own permit

program for discharges into navigable waters within its jurisdic-

tion may submit to the Administrator a full and complete

description of the program it proposes to establish and ad-

minister under State law or under an interstate compact. In ad-

dition, such State shall submit a statement from the attorney

general (or the attorney for those State water pollution control

agencies which have independent legal counsel), or from the

chief legal officer in the case of an interstate agency, that the

laws of such State, or the interstate compact, as the case may

be, provide adequate authority to carry out the described pro-

gram. The Administrator shall approve each such submitted

program unless he determines that adequate authority does not

exist:

(1) To issue permits which—

(A) apply, and insure compliance with, any applicable

requirements of sections 1311, 1312, 1316, 1317, and 1343

of this title;

(B) are for fixed terms not exceeding five years; and

(C) can be terminated or modified for cause including,

but not limited to, the following:

(i) vioiation of any condition of the permit;

(ii) obtaining a permit by misrepresentation, or

failure to disclose fully all relevant facts;

(iii) change in any condition that requires either a

temporary or permanent reduction or elimination of

the permitted discharge;

(D) control the disposal of pollutants into wells;

ao A390 —

(2A) To issue permits which apply, and insure compliance

with, all applicable requirements of section 1318 of this title, or

(B) To inspect, monitor, enter, and require reports to at least

the same extent as required in section 1318 of this title;

(3) To insure that the public, and any other State the waters

of which may be affected, receive notice of each application for

a permit and to provide an opportunity for public hearing

before a ruling on each such application;

(4) To insure that the Administrator receives notice of each

application (including a copy thereof) for a permit;

(5) To insure that any State (other than the permitting State),

whose waters may be affected by the issuance of a permit may

submit written recommendations to the permitting State (and

the Administrator) with respect to any permit application and,

if any part of such written recommendations are not accepted

by the permitting State, that the permitting State will notify

such affected State (and the Administrator) in writing of its

failure to so accept such recommendations together with its

reasons for so doing;

(6) To insure that no permit will be issued if, in the judgment

of the Secretary of the Army acting through the Chief of

Engineers, after consultation with the Secretary of the depart-

ment in which the Coast Guard is operating, anchorage and

navigation of any of the navigable waters would be substantially

impaired thereby;

(7) To abate violations of the permit or the permit program,

including civil and criminal penalties and other ways and means

of enforcement;

(8) To insure that any permit for a discharge from a publicly

owned treatment works includes conditions to require the iden-

tification in terms of character and volume of pollutants of any

significant source introducing pollutants subject to pretreat-

— A-31 —

ment standards under section 1317(b) of this title into such

works and a program to assure compliance with such pretreat-

ment standards by each such source, in addition to adequate

notice to the permitting agency of (A) new introductions into

such works of pollutants from any source which would be a new

source as defined in section 1316 of this title if such source were

discharging pollutants, (B) new introductions of pollutants into

such works from a source which would be subject to section

1311 of this title if it were discharging such pollutants, or (C) a

substantial change in volume or character of pollutants being in-

troduced into such works by a source introducing pollutants in-

to such works at the time of issuance of the permit. Such notice

shall include information on the quality and quantity of effluent

to be introduced into such treatment works and any anticipated

impact of such change in the quantity or quality of effluent to

be discharged from such publicly owned treatment works; and

(9) To insure that any industrial user of any publicly owned

treatment works will comply with sections 1284(b), 1317, and

1318 of this title.

Suspension of federal program upon submission of State

program; withdrawal of approval of State program

(cM1) Not later than ninety days after the date on which a

State has submitted a program (or revision thereof) pursuant to

subsection (b) of this section, the Administrator shall suspend

the issuance of permits under subsection (a) of this section as to

those navigable waters subject to such program unless he deter-

mines that the State permit program does not meet the re-

quirements of subsection (b) of this section or does not conform

to the guidelines issued under section 1314(h)(2) of this title. If

the Administrator so determines, he shall notify the State of any

revisions or modifications necessary to conform to such re-

quirements or guidelines.

— A-32 —

(2) Any State permit program under this section shall at all

times be in accordance with this section and guidelines pro-

mulgated pursuant to section 1314(h)(2) of this title.

(3) Whenever the Administrator determines after public hear-

ing that a State is not administering a program approved under

this section in accordance with requirements of this section, he

shall so notify the State and, if appropriate corrective action is

not taken within a reasonable time, not to exceed ninety days,

the Administrator shall withdraw approval of such program.

The Administrator shall not withdraw approval of any such

program unless he shall first have notified the State, and made

public, in writing, the reasons for such withdrawal.

§ 1370. State authority.

Except as expressly provided in this chapter, nothing in this

chapter shall (1) preclude or deny the right of any State or

political subdivision thereof or interstate agency to adopt or en-

force (A) any standard or limitation respecting discharges of

pollutants, or (B) any requirement respecting control or abate-

ment of pollution; except that if an effluent limitation, or other

limitation, effluent standard, prohibition, pretreatment stan-

dard, or standard of performance is in effect under this chapter,

such State or political subdivision or interstate agency may not

adopt or enforce any effluent limitation, or other limitation, ef-

fluent standard, prohibition, pretreatment standard, or stan-

dard of performance which is less stringent than the effluent

limitation, or other limitation, effluent standard, prohibition,

pretreatment standard, or standard of performance under this

chapter; or (2) be construed as impairing or in any manner af-

fecting any right or jurisdiction of the States with respect to the

waters (including boundary waters) of such States.

June 30, 1948, c. 758, Title V, § 510, as added Oct. 18, 1972,

Pub.L. 92-500, § 2, 86 Stat. 893.

= Add

APPENDIX D

Tennessee Water Quality Control Act

Provision

69-3-108. Permits.—(a) Every person who is or is planning to

carry on any of the activities outlined in subsection (b) of this

section, other than a person who discharges into a publicly own-

ed treatment works or who is a domestic discharger into a

privately owned treatment works, shall file an application for a

permit with the commissioner or, when necessary, for modifica-

tion of his existing permit.

(b) It shall be unlawful for any person, other than a person

who discharges into a publicly owned treatment works or a per-

son who is a domestic discharger into a privately owned treat-

ment works, to carry out any of the following activities, except

in accordance with the conditions of a valid permit:

(1) The alteration of the physical, chemical, radiological,

biological, or bacteriological properties of any waters of the

state;

(2) The construction, installation, modification, or operation

of any treatment works or part thereof, or any extension or ad-

dition thereto;

(3) The increase in volume or strength of any wastes in excess

of the permissive discharges specified under any existing permit;

(4) The development of a natural resource or the construc-

tion, installation, or operation of any establishment or any ex-

tension or modification thereof or addition thereto; the opera-

tion of which will or is likely to cause an increase in the

discharge of wastes into the waters of the state or would other-

wise alter the physical, chemical, radiological, biological or

bacteriological properties of any waters of the state in any man-

ner not already lawfully authorized;

—>

(5) The construction or use of any new outlet for the

discharge of any wastes into the waters of the state;

(6) The discharge of sewage, industrial wastes or other wastes

into waters, or a location from which it is likely that the

discharged substance will move into waters; or

(7) The discharge of sewage, industrial wastes, or other wastes

into a well or a location that is likely that the discharged

substance will move into a weil.

— A-35 —

APPENDIX E

Federal Register / Vol. 48, No. 195 /

Thursday, October 6, 1983 / Notices 45597-45598

Under the NPDES Permit Regulation (48 FR 14146, April 1,

1983), EPA will provide Federal Register notice of actions by

the Agency approving or modifying a State NPDES program.

The following table will provide the public with an up-to-date

list of the status of NPDES permitting authority throughout

{the country].

| Approved to ey

NPDES | FON | prevest

perma te oe mare

progam program

Aiabere ......... 10/10/78 10/10/78 10/18/79

Catttorme 6/14/73 6/s/7e

. Cotoredo 3/27/76

Connection, ......... 0/26/73 ‘6/3/81

( tewere 4/1/74

SO 6/28/74 12/8/80 3/12/61

Hewe? .............. 11/28/74 e/1/7e 6/12/63

Sroe................ vied 6/20/79 |

ene wi 12/0/78 |.

we 6/10/78 6/10/78 6/3/81

ay 6/28/74

Kentucky 0/30/83 0/30/83 0/30/83

Maryend 0/5/74

Macragen 10/17/73 12/0/78 6/7/63

Merwnercts........... 6/30/74 12/0/78 7/16/78

Meee, ......... 6/1/74 1/28/63 8/13/82

eg sO 10/30/74 6/26/79 6/3/81

Net ests 6/12/74 49/2/78

Nees 0/10/75 6/31/78

i ao odd 4/13/62 4/13/62 4/13/82

New York 10/28.'75 |

North Carcire ... 10/10/76 6/14/82

Mort) Dekote 6/13/78

Oro a/11/74 1/28/83 7/27/63

Qregon. 0/26/73 3/2/79 3/12/81

Pewepvers 6/s0/76

Sou Corctra...... 6/10/76 0/26/80 4/0/82

oo 12/28/77 6/10/83

Veweort a/1i/74 3/16/82

Vegr tetands ..... 6/30/74

Vy 3/31/78 2/0/@2

Weetwgion 11/14/73

west Vwyru: | 6/10/62 6/10/82 6/10/82

wWieconssn 2/asta 1/28/79 12/24/60

wWyorrang. 1/30/78 6/16/81

e.

Me