Petition for Writ of Certiorari — Consolidated Edison Co. of New York, Inc. v. Scenic Hudson Preservation Conference

Supreme Court brief1966

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Le fe FI!ED

JOHN F. DAVIS, CLERK

IN THE

Supreme Court of the United States

_ OCTOBER TERM, 1965

No. 1 1 O 9

CONSOLIDATED EDISON COMPANY OF

NEW YORK, INC.,

Petitioner,

SCENIC HUDSON PRESERVATION CONFERENCE,

TOWN OF CORTLANDT, TOWN OF PUTNAM VAL-

LEY, TOWN OF YORKTOWN, and FEDERAL POWER

COMMISSION, ,

: Respondents.

PETITION FOR A WRIT OF CERTIORARI TO THE

UNITED STATES COURT OF APPEALS FOR THE

SECOND CIRCUIT

Ranpatu J. LEBoevr, Jr.,

Counsel for Petitioner,

One Chase Manhattan Plaza,

New York, N. Y. 10005.

Of Counsel: ;

ALFRED E. Frou, Esq.

LzBoevur, Lams & Lewy

March 28, 1966

INDEX

. PAGE

Citations to Opinions Below 41

PI acihcicictcosilinsiniictadateiinngtoinimahcnichasbenescintedaitatlntaaiapscclldgh 2

‘Questions Presented 2

Statutes Involved | , hicetdieaacag: oe

Statement 5

Reasons for Granting the Writ ..... , 13

Conclusion sacennesses 33

Appendix A—Opinion a the Court of Appeals sihieidd la

eo B—Statutes Involved _ ze ae

CITATIONS

Cases:

. Atchison, T. & SFR. Co. ‘v. United States, 284

U.S. 248 (1932) 26

Balazs v. Anderson, 77 F. Sunn 612 (D.C. N.D.

Ohio 1948) 30

Consolidated Edison Co. v. NLRB, 305 U.S. 197

ET caadsehialtihsnnccccginsnilesassombicaiestipaondielaieabenaancmmaatboan 20, 21

English v. Mattson, 214 F.2d 406 (5th Cir. 1954) _. 23

FPC v. Transcontinental Gas Pipe Line Corp., 365

U.S. 1 (1961) 25

Federal Power Commission v. Union Electric Co.,

381 U.S. 90 (1965) ae

PAGE

Hartford Electric Light Co. v. FPC, 131 F.2d 953,

966 (2d Cir. 1942), cert. den., 319. US. 741 (1943) 30

- 1.0.0. v. J-T Transport Co., 368 U.S. 81 (1961) ... 18

I.C.C. v. Jersey City, 322 U.S. 508 (1944) ........ 23, 25, 26

NLRB. vy. Columbia Enamcling & siti id Co.,

306 U.S. 292 (1939) 20; 21

Norris & Hirshberg v. SEC, 163 F.2d 689: (D.C.

Cir. 1947), cert. den., 333 US. 867 (1948) ............ 30

Railroad Commission of Texas v. Rowan & Nichols

Oil Co., 310 U.S. 573 (1940) 29

United States vy. Northern Pacific Railway Co., 288

U.S. 490 (1933) 26

United States v. Pierce Auto Lines, 327 U.S. 515

(1946)... aceaeDdy 20, 20

Universal Camera Corp. v. NLRB, 340 US. 474

CS Eee) Ne 13

Washington Public Power Supply System v. FPC,

Docket Nos. 18728, 18729, 18731 (D.C. Cir. March

24, 1966) 27

Statutes:

Administrative Procedure “Act

Section 7(c), 5 U.S.C. 1006(e) 2,5, 14,17

Section 7(d), 5 U.S.C. 1006(d) awwee4y 5, 81

Section 10(e), 5 U.S.C. 1009(e) 2, 3, 4,5

| : ? 13, 14, 20, 22, 31, 32

Federal Power Act, 16 U.S.C. 791(a) et. seq. ......... 6

Section 10(a); 16 U.S.C. 803(a) | 5, 19

Section 313(a); 16 U.S.C. 825 1 (a) nn... 5,31

Section 313(b) ; 16 U.S.C. 825 I (b) .......2, 3, 4,5, 10,

a 13, 14, 20, 22, 31, 32

iii

Miscellaneous: ’

TLR. Rep. No. 1980

79th Corfe: 2d Sess. (1946) ooeecceececcccccsseesseen

' FPC, National Power Survey (1964)

Part I .

Part II

FPC Form No. 12 “3

FPC Planning Status Report on the Hudson River

‘Sen. Doc. No. 248, 3

79th Cong: 2d Sess. (1946).

2 Wigmore on Kvidence

(3d Ed.) §575

IN THE

Supreme Court of the United States

OCTOBER TERM, 1965

No.

ConsoLipaTeD Epison Company or New York, Inc.,

Petitioner,

Scenic Hupson Preservation CONFERENCE,

Town oF CortLannt, Town or Pyrnam VALLEY,

Town oF YORKTOWN, and FreperaL Power CommMIssion,

} Respondents.

; oy

PETITION FOR A WRIT OF CERTIORARI TO THE

UNITED STATES COURT OF APPEALS FOR THE

SECOND CIRCUIT.

Petitioner, Consolidated Edison Company of New York,

Ine., prays that a writ of certiorari issue to review the

judgment of the United States Court of Appeals for the

Second Circuit entered in the above entitled case on ©

December 29, 1965.

Citations to Opinions Below

The opinion of the Court of Appeals below is reported

in 354 F. 2d 608, and is printed in Appendix A hereto,

infra p. 1a et seq.’ The opinion and order of the Federal

“1. References herein. to “Opinion, ” refer to the pages of

Appendix A.

Power Commission (hereinafter «“PC” or “Conimission”),

issuing a license (FPC Opinion No. 452, March 9, 1965)

is reported at 33 F.P.C. 428 (1965), and is filed with this

petition as part of the record below, Joint Appendix, p.

684. The initial decision of the Presiding’ Examiner in

the FPC is reported in 33 F.P.C. 465 (1964) and is filed

with this petition as part of the record below, Joint

Appendix, p. 558.

, _ Jurisdiction,

The judgment of the Court of Appeals was entered on

December 29, 1965. The jurisdiction of this Court is in-

voked under 28 U.S.C. Section 1254(1), and Federal Power

Act, Section 313(b), 16 U.S.C. 825 1 (b).

Questions Presented

1. Is an administrative order invalid, under Sections

7(c) and 10(e) of the Administrative Procedure Act, for

failure to make a formal record respecting a potentially

relevant factual question which had not been put in issue

by any party? With reference to the instant case, was

it an error for the FPC to license the Cornwall hydro-

electric project without compiling a formal record as to

the unavailability of interconnected power sources as a

substitute, when at no time during the hearing or prior to

issuance of such license did any party contend such sources

would provide a substitute and the evidence of record

indicated that they would not?

2. Where an intervenor opposing an administrative

order itself proffers no evidence on certain factual sub-

jects, do Sections 7(c) and 10(e) of the Administrative

Procedure Act and Section 313(b) of the Federal Power

Act permit a Court of Appeals to reverse such order at

the behest of such intervenor, with directions that the

administrative agency affirmatively search out and put in

. the record further testimony on such subjects? With

reference to the instant case, where the FPC had found,

based upon its own background and expertise, upon the

responsé of other agencies to specific inquiries, and upon

the testimony offered by applicant for the license that:

a) the proposed project would not damage fish life; b)

‘the cost of extended underground transmission would be

prohibitively expensive and c¢) interconnected utilities do

not provide an alternative source of power, must it also,

make a further.formal record on these topics independent

of that offered by applicant, notwithstanding that no other

party has offered such evidence or suggested where it

might be obtained? w

_ 3. Does an administrative order fail to meet the tests

of the substantial, evidence rule prescribed by Section

10(e) of the Administrative Procedure Act and Section

313(b) of the Federal Power Act, solely because the evi-

dence of record upon certain technical issues consists of

testimony of witnesses, otherwise qualified, proffered by

the petitioner for such:order? With reference to the

instant case, was it error for the FPC to credit the testi-

mony of corporate officers of the applicant for the license

on the issues of alternate power sources and -costs of

underground 345,000 volt transmigfion facilities, notwith-

standing the fact that such officers were qualified and prac-

ticing engineers and the applicant was the only company

which had ever constructed underground 345,000 volt

transmission facilities. a

4. Where an administrative agency has refused after

close of hearings to reopen a proceeding for further testi-

mony on a technical subject upon which the agency has

substantial expertise and on which both the applicant and

the opposing intervenor have submitted evidence, do

Section 10(e) of the Administrative Procedure Act and

Section 313(b) of the Federal Power Act permit a Court

of Appeals to reverse upon the ground that in its judg-

ment the evidence of record is not “meaningful”.. With

reference to the instant case, where the Commission after

having heard testimony by witnesses for the applicant and

an intervenor relative to the adequacy of gas turbines as

an alternative source of power, concluded that they would

not provide an adequate substitute source, and thereafter

rejected the proffer of an additional witness on such sub-

ject made several months following the close of hearings

upon the ground that the proffered testimony would at

most constitute a disagreement among experts, was it

error for the Court of Appeals to reverse upon its evalua-

tion of the technical testimony of record as not being

“meaningful” although failing to find that the testimony

in the record did not constitute “substantial evidence”.

5. Did the action taken by the Court of Appeals below

in receiving and avowedly basing its decision on matter

not in the record before the agency, and substituting its

judgment for that of an expert administrative body,

constitute a deviation from the requirements of Sections -

7(d) and 10(e) of the Administrative Procedure Act

and Section 313(b) of the Federal Power Act, and a sub-

stantial-departure from the proper procedure to be fol-

lowed by appellate courts? With reference to the instant

case, was it error for the Court of Appeals to receive and

consider the record taken in a proceeding held subsequent

- to the issuance of the orders which were the subject of

review, and unsworn statements subsequently offered

before legislative committees, as“affecting the adequacy

of the record upon which the Commission had issued the

orders being appealed from?

6. Did the action of the Court of Appeals, in setting

aside the orders of the Federal Power Commission herein

so exceed the authority of such court under the Adminis-

trative Procedure Act and the Federal Power Act that

such action should be reversed and the Commission orders

_. reinstated? | ff

Statutes Involved

The statutory provisions involved are Sections 7(c), 7(d)

and 10(e) of the Administrative Procedure Act, 60 Stat.

241, 5 U.S.C. 1006(c), 1006(d) and 1009(e); and Sections

10(a), 313(a) and.313(b) of the Federal Power Act, 49

Stat. 842, 860, 16 U.S.C. 803(a), 825 1 (a) and 825 / (b).

' They are printed in Appendix B, infra, p. 1b, et seq.

Statement

The Project

Petitioner, Consolidated Edison Company of New York,

Inc. (sometimes hereinafter “Con Edison”) is a public

utility supplying electricity to New York City and an

adjacent county (A. 156).2 On January 29, 1963 it applied

to the Federal Power Commission, pursuant to the Federal

2. References to the — Appendix in the Court of Appeals are

herein cited as “A.

Power Act, 16 USC 792, et seqg., for a license to construct

a pumped-storage hydroelectric -plant® (“the project’)

on the west bank of the Hudson River at Cornwall, New

York (A..6) adjacent to Storm King Mountain (A. 421,

701).

The Hudson River would act as the lower_reservoir;

the upper reservoir would be situate slightlh¥ over a mile

inland from the Hudson River and from Storm King

Mountain, and would not be visible from the River (A.

421, 691, 701).

Transmission lines of 345,000 volt capacity would be

required to connect the project with the remainder of the

system. Such lines would be put under the River and an

additional 1.6 miles underground on the east shore to a

substation at Nelsonville, N. Y., which will not be visible

from the River (A. 694, 704-705), then will go overhead

through sparsely settled country (A. 715-721).

The Administrative Proceedings

On March 12, 1963, the Federal Power Commission duly

published notice of the license application, and set April

29, 1963 as the last date to intervene (A. 6, 7, 488-489).

On January 22, 1964, the Commission fixed hearings to

commence February 25, 1964. On February 6, 1964,

Scenic Hudson Preservation Conference, respondent

herein (“Scenic Hudson”),* moved for leave to intervene,

3. In concept and operation the plant would be similar to that

considered by this Court in Federal Power Commission v. Union

Electric Co., 381 U. S. 90, 92 (1965), (A. 687-690) except that a

portion of this plant’s capacity would be used for “spinning reserve”

(p. 16 mfra). ;

4. Various other of the respondents herein participated in certain

of the procedural steps described ; for convenience, however, reference

herein will be confined to Scenic Hudson.

and such motion was granted in full on February 14,

1964. Hearings commenced February 25, 1964 with Con

Edison presenting its prima facie case in a two day

session. All parties, including Scenic Hudson, were

given full opportunity to cross-examine and present evi-

dence. Included in the record presented by Con Edison

was the testimony of Dr. Alfred Perlmutter, Associate

Professor of Biology at New York University, as to the

adequacy of fish protection facilities (A. 39-58). Also

included in the record were comments on fish protection

submitted pursuant to FPC request by the United States

Department of the Interior and the New York Water

Resources Commission (A. 26-28, 493-497). Neither

agency opposed the project or expressed the view that it

would be unduly damaging to fish life. |

Scenic Hudson successfully moved to postpone further

hearings until May 4, 1964 in order to permit it to

present the testimony of an expert engineering witness on

the subject of possible sources of power which might be

alternatives to the project. Hearings were held from

May 4 through May 12, 1964, during which time Scenic

Hudson’s expert witness Fosdick testified and presented

an exhibit with respect to alternative sources of power,

including gas turbines’ (A. 322-327, 332-368, 451). Con

Edison had presented testimony noting the over-all

advantages of the Cornwall Project-as compared to other

types of generation (A. 156-162); in addition testimony

.as to the inadequacy of the specific alternative power

sources which had been suggested by Mr. Fosdick was .

given by a qualified practicing engineer who also happened

‘ §. The term “gas turbines” refers to the fact that the turbine

blades are turned by hot exhaust gases of jet engines; the jet

engines may in turn be fueled either by natural gas or kerosene

(A. 325, 355).

to be an officer of Con Edison (A. 10-12, 396-398). At this

session testimony was given by another Company officer,

also a qualified and experienced engineer, on the relative

costs which would be incurred in putting project trans-

mission lines underground (A. 189-90, 196-200, 231-234).

No ‘evidence on the issue of cost of underground lines, or

- the issue of fish protection, was offered by Scenic Hudson

or any other intervenor at either the February or May

1964 hearings. Scenic Hudson made no further request for

extension of time, or opportunity to present evidence,

until after the license had issued.

On March 9, 1965, the FPC issued an opinion and

order which granted a license for the project under certain

terms and conditions (A. 685-776). The Commission found

that the project would provide an economic benefit of not

less than $12,000,000 annually over the only feasible

alternative (A. 699, 708-713),¢ would have a “minimal”

impact upon scenic resources while creating additional

- recreational opportunities (A. 705-708), and that its “ad-

vantages for power purposes far outweigh any negative

considerations” (A. 707). H = specifically considered and

rejected gas turbines as an alternative (A. 713).

The Commission found that the project facilities would

be adequate to protect fish life. However, in addition to

imposing the standard license condition on the subject

(which the Commission’s rules require in every license and

provides for future modification of project structures

whenever. found necessary and desirable), the Commission

incorporated the suggestions of the Department of

Interior as a special condition in the license (A. 725-729).

The Commission, having viewed the site (A. 687), also

6. The Commission subsequently noted that this would benefit

consumers in the Con Edison territory (A. ise

found that requiring the transmission lines to be placed

underground in the area beyond the view of the

Hudson River would entail “extravagant additional

costs * * *-in view of the limited impact which the

lines would have upon the area involved” (A. 722).

This area, the Commission noted, was “generally wooded

and sparsely settled” if the route proposed by Con Edison

were followed, while if the route favored by the Com-

mission staff “after extensive study of the entire area”

were followed, the line would, except for one segment,

“traverse a relatively underdeveloped and sparsely settled

area” (A. 718-719). The Commission order of March 9,

1964 ordered further hearings regarding the specific trans-—

mission route (A. 723-725, 738), and, “in view of the

opportunity offered” by such further hearings, provided

for the receipt of further evidence at that time concern-

ing the design of the fish protection devices (A. 729, 739).

However, the remainder of the project works were found

to be “desirable in the public interest” and a license

issued therefor in the belief that the further hearings

would not delay construction of the major works (A. 725).

On April 8, 1965, Scenic Hudson applied for rehearing

of the March 9, 1965 order, and for reopening of the pro-

ceeding to introduce additional evidence by a Mr. Lurkis

on gas turbines as an alternative power source (A. 777).

(Such testimony had been offered on January 1965, seven

months after close of the hearings, by a would-be inter-

venor, who did not seek review of the Commission’s denial

of its petition (A. vi, 652).) The Scenic Hudson motion

was denied on May 6, 1965 (A. 790), the Commission

stating that

“The evidence regarding the. alternatives egsablishes

that the Cornwall ‘project is far superior to any

possible alternative: At best, the evidence now

offered would appear to consist of a disagreement

between experts. At this stage of the proceeding

_ in particular, the attempted introduction of addi-

tional evidence of this character provides no basis

for a reopening of the record” (A. 795).

On April 26, 1965, Scenic Hudson moved that the addi-

tional hearings which the Commission had ordered to

hear the limited issues of transmission line route and

design of fish facilities, be broadened to reconsider the

general issue of the effect of the project upon fish life and

the issue of whether or not most of the transmission

facilities from the project should go underground (A. 802).

No evidence on either of these issues was proffered or

described by such motion. This motion was denied May 6,

1965 (A. 812).

The Appellate Proceeding

On July 6, 1965, Scenic Hudson petitioned the United

States Court of Appeals for the Second Circuit, pursuant

to Section 313(b) of the Federal Power Act (16 USC,

Section 825 1 (b)) to set aside the orders of March 9, 1965

and both orders of May 6, 1965.

In its petition, Scenic Hudson raised no question as to

whether there was substantial evidence underlying the

March 9, 1965 licensing order, but took the position that

the Commission was in error in failing to reopen the

proceedings. to hear Scenic Hudson’s proffer of further

testimony on gas turbines, and for failing to reopen to

take further evidence on the issues of fish life and whether

the project transmission lines should be placed under-

ground. On these latter issues it offered no evidence,

but took the stance that the Commission was under an

affirmative duty to seek such evidence as Scenic Hudson

thought appropriate.

Scenic Hudson also moved that the transcript of the

further hearings before the Commission on the issues of

fish protective devices and transmission line route, which

hearings had commenced on May 4, 1965 and continued

until May 21, 1965, subsequent to the date of the last order

under review, be made part of the record. This motion

was granted by the Court of Appeals over objection of

the Commission and Con Edison, and such record was

received and considered (Opinion 3a), although no rehear-

ing or review of the order which resulted from those

hearings had been sought.

The Court of Appeals set aside all three orders under

review, upon the general stated ground of incompleteness

of record on alternative sources of power, effect on fish

life, and the ‘cost of transmission lines. It stated, not-

withstanding 80 pages of testimony of record on alterna-

tive sources of power (R. 1171-1179, 1231-1296, 1408-1409,

1527-1529 [A. 322-327, 332-369, 376-377, 396-398])* includ-

ing testimony showing that the subject had been studied

by the Commission’s staff (A. 290-291, 376-377), and 6

pages of the Commission’s opinion on the subject (R. 2942-

2947 [A. 708-714]) that, in the Court’s opinion, the Com-

-qnission “failed to make a thorough study of - possible

alternatives” to the project, and that the Court found no

“meaningful” evidence which contradicts the proffered

imony supporting the gas turbine alternative (Opinion

‘Ga, 18a). The testimony of Mr. Fosdick (Scenic Hudson’s

witness) on this subject was dismissed as “hastily. pre-

7. “R.” references are to pages of the transcript made before the

FPC. All such references contained in this petition appear in the

text of the Joint Appendix, wherein they are indicated by brackets.

pared”, and, on the ground that “his direct testimony

occupied less than ten pages of the record” was deemed

“too scanty to meet the requirements of a full considera-

tion of alternatives.” (Opinion 21a) No reference was

made by the Court to the 65 pages of testimony given

by Mr. Fosdick on cross-examination (RB. 1231-1296 TA.

332-368]). The testimony of Consolidated Edison’s engi-

neering witness was brushed aside as “self-serving”.

(Opinion 21a) The fact that Mr. Lurkis’ testimony was

not offered by Scenic Hudson until after the license

issued was deemed irrelevant Since the testimony had been

offered by the other intervenor (who however had not

petitioned for review the denial of its application)

two months prior to isssuance of the license, but 8 months

after close of hearings. (Opinion 21a)

~The Court of :Appeals also held that, although Scenic

. Hudson at no time offered evidence on the subject, the

Commission erred in that it “neither investigated the

use of interconnected power as a possible ‘fiternative to

the Storm King project, nor required Consolidated Edison

to supply such information” (but see the Commission’s -

opinion, A. 710-711, and A. 19-20). The Court noted that

the Commission’s subsequent order of October 4, 1965 (on

transmission line routes), had stated that ample spinning.

reserve would be available from Pennsylvania and New

. Jersey in the winter months. The Court rhetorically

asked :

“Tf interconnected power can replace the Storm

King project.in December, why was it not con-

sidered as a permanent alternative 7.4 Opinion:

26a-27a) :

The Court also held that: there was “almost nothing in

the record” with respect to underground transmission

costs (but see A. 179, 189-194, 197-210, 225-234, 432-433)

pws

oe y

° ; ; e s A r 2

and that the Commission did not weigh “the aesthetic

advantages of underggound transmission lines against the

economic disadvantages” (but see the Comfnission’s Opin-

‘jon A. 704-705, 715-725).

With respect to fish life, the Court held, on the basis

of certain statements made following the March.9, 1965

order (Opinion 30a-3la) that the Commission erred in

giving weight to Dr. Perlmutter’ s testimony. (Opinion 30a-

31a)

The Court’s - opinion -required. the Commission to

“reexamine” all questions on which the Court found the

evidence insufficient, and stated that notwithstanding the

failure of any intervenor to offer evidence on such an

issue, the Commission had an affirmative duty’to make a

record of its own on these issues. Aine F

0 Reasons for Granting the Writ

The decision of the Court of Appeals creates novel, and,

it is submitted, dangerous departures from accepted stand-

ards. of review of agency action. Petitioner believes that

the decision is contrary to the specific dictates of the Fed-

eral Power Act and the Administrative Procedure Act,

and unless such decision is reversed by this Court, and

the Commission’s orders reinstated, the opinion below’

endangers the administrative process.

The opinion below is not a mere factual misapplication

of the ‘substantial evidence rule laid down by Section

* 10(e) of the Administrative Procedure Act, and Section

313(b). of the Federal .Power Act. Such misapplication,

eoncededly, would not be subject to review by this

Court under the doctrine of Universal Camera Corp. v.

NLRB 340 U. S. 474 (1951). Neiacan Petitioner believes

that it is evident, on the face of the opinion below,

that the Court’ of Appeals has created and applied new

procedural requirements applicable to administrative

adjudications which substantially supersede and modify

both the substantial evidence rule and the rules relating

to burden of proof which are prescribed by §7(c) of the

Administrative Procedure Act. The new rules for admin- ©

istrative procedure and review laid down by the opinion

below throw a cloud on virtually every administrative

proceeding, and would thwart the purpose and intent of

the Administrative Procedure Act to simplify and expe-

dite, as well as the express limits placed upon the Court’s

review of decisions of the FPC by Section 10(e) of the

Administrative Procedure Act and Section 313(b) of the

Federal Power Act. The questions raised by the opinion

below, if its stands, illustrate the problem.

a) Is an administrative order invalid for failure to

make a formal record respecting every potentially

relevant factual question, which question had not

been put in issue by any party? Under Section

7(c) of the Administrative Procedure Act, may a

’ party, by merely raising an issue without offering

evidence thereon, throw upon the agency the affirm-

ative burden of procuring such evidence and

placing it in the record?

With respect to at least three subjects, ie., fish pro-

tection, underground transmission costs, and alternative

sources of power through interconnected facilities, the

Court of Appeals imposed upon the Commission an affirm-

ative duty to make a- record which the Court would

deem satisfactory, although no intervenor at any time

9°

* 15

offered any evidence on a subjects. Indeed, with

respect at least to fish and to interconnections as alter-

native sources of power, no intervenor raised any issue

prior to the close of hearings (see Petitions to Intervene,

A. 510, 516, 548, 554).

The rule prescribed by the opinion below would fly in

the face of administrative procedure as prescribed by

statute and by practical necessity. In any administrative

proceeding, as in any judicial proceeding, there are

literally an infinite variety of issues which can be con-

ceived of by a pure logician. In any administrative or

judicial proceeding these issues are narrowed by the fact

that the parties cannot raise purely theoretical issues

without assuming the burden of showing a practical rela-

tionship to the case. To take the instant proceeding,

various rather exotic means of power generation exist on

a theoretical basis, including thermoelectric generation,

thermionic generation, and magneto-hydrodynamic gen-

eration. (See National Power Survey, Part II, pages

73-74, 78-79.) No party, however, raised these alterna-

tives as an issue, for the simple reason that no practical

basis could be found for doing so. Was the Commission

in error in failing to make a record on this point not-

withstanding the knowledge of its technical staff that

these alternatives were, as a practical matter, absurd?

Must a witness be found, sworn, and testify at length, to

create a record on this subject under penalty of subse-

quent reversal by a Court of Appeals?

The example given is not fanciful. The Court of Appeals

below applied this same type of rule with respect to inter-

connections as an alternative source of power. As

pointed out above, the only evidence on this issue was that

interconnections would not be an alternative source of

power. No intervenor ever offered evidence to the con-

trary nor, prior to the close of hearings, even suggested

the contrary. However, as previously noted, the Court

assumed as a fact that ample spinning reserve® would be

available from Pennsylvania and New Jersey interconnec-

tions in the winter months, and starting from this premise

wondered : 3 :

“If interconnected power can replace the Storm

King project in December, why was it not con-

sidered as a permanent alternative?” (Opinion 27a)

The question is not illogical, but wholly without practi-

eal basis. Anyone with a knowledge of basic fundamentals,

including the Commission, its staff, and any potential

qualified expert witness approached on the subject by any

‘ intervenor would be aware of the fact that Pennsylvania

and New Jersey utilities are part of the Pennsylvania-

New Jersey-Maryland Power Pool (FPC, National Power

Survey Table 60, pp. 227-228) and that due to air condi-

tioning demands this pool has a heavy summer peak load

which it must provide capacity to meet (FPC Form No. 12

as filed with the FPC for Pa.-N. J.-Md. Interconnection,

1964, Schedule 14 p. 23 shows summer peak load of 900,000

kilowatts in excess of the maximum load occurring in

December). The result is a surplus of capacity by the

Pennsylvania and New Jersey companies in the winter, *

but not in the summer.

The example illustrates the inherent danger of letting

the Courts frame the factual issues to be decided by the

administrative agency. However logical, the Courts are

8. “Spinning reserve” is generating capacity held in reserve, not

generating power but kept spinning so as to be immediately available

in emergency. It is to be distinguished from “cold reserve” which

may take several hours to be brought into operation (A. 255-256,

378-379).

technologically untrained and lack technical staff. If the

view of the Court of Appeals herein should become law,

it would require a court to adopt any plausible argument

which some intervenor, freed from the responsibility im-

posed by having to seek evidence, may suggest.

The Court erred in suggesting that the only alternative

is for the agency “to act as an umpire blandly calling

balls and strikes”. Clearly the agencies have an affirma-

tive duty to protect the public interest, and to require

applicants to present a prima facie case. This, however,

should not be confused with a duty to compile a record

of facts which the agency, with its background of expertise,

recognizes is of no practical significance. The Commis-

sion is charged with the duty to protect the public inter-

est, and has the technical expertise and staff to determine

what issues merit examination in the public interest. If

they are remiss, any party with a legitimate interest to

protect has full right and opportunity to present evidence’

on any issue which the Commission has overlooked, but

it has no right to require the Commission to affirmatively

undertake the burden of seeking out evidence which the

latter believes to be of no practical materiality. As ap-

plied to the instant case, with respect to issues not even

raised by the intervenor until after issuance of the order,

it not only imposes a burden of seeking out evidence, but

imposes the insuperable burden upon Commission and ap-

plicant of trying to imagine every issue which might con-

ceivably, after decision by a regulatory agency, be plausi-

bly advanced to a reviewing court lacking the technical

expertise of the agency.

The Administrative Procedure Act specifically provides

in Section 7(c) | |

“Except as statutes otherwise provide the pro-

ponent of a rule or order shall have the burden of

ae Se

That this was meant to apply to intervenors, who are

the proponents of a rule or order which would deny the

license being sought, is made clear by the legislative

history of- the Act. The complete legislative history

appears as Senate Document No. 248, 79th Congress, 2nd

Session. In such report, at page 270 (being the report of

the House Judiciary Committee, House Report No. 1980,

- 79th. Congress, 2nd Session) it is stated:

“That the proponent of a rule or order has the

burden of proof means not only that the party

initiating the proceeding has the general burden of

coming forward with a prima facie case but that

other parties, who are proponents of some different

‘ result, also for that purpose have a burden to main-

tain. Similarly the requirement that no sanction be

imposed or rule or order be issued except upon

evidence of the kid specified means that the pro-

ponents of a denial of relief must sustain such

denial by that kind of evidence. * * * In other words,

this section means that every proponent of a rule

or order or the denial thereof has the burden of

coming forward with sufficient evidence therefor;

and in determining applications for licenses or other

relief any fact, conduct, or status so shown by

credible and credited evidence must be accepted as

true except as the contrary has been shown or such

evidence has been rebutted or impeached by duly

credited evidence or by facts officially noticed and

stated.” (Emphasis supplied.) :

This Court applied such a rule, in a completely analogous

situation, in ICC v. J-T Transport Co., 368 U. S. 81 (1961).

In that case it was held that where an applicant for a

certificate demonstrated the need for the proposed service,

it was incumbent upon the protestant existing carriers to

present evidence to show that they have the willingness

and ability to meet that need. See 368 U. S. at 90.

The Federal Power Act, Section 10(a), does not require,

as a condition precedent to the grant of a hydroelectric

license, that there be no possible alternative source of

power: it merely requires that the proposed project “shall

be such as im the judgment of the Commission shall be

best adopted to a comprehensive plan for improving or -

_ developing the waterway”. Certainly a prima facie case

on that point was ¢reated when applicant presented evi-

dence upon which the Commission found that the project

would not only create reliable power for which there was

a demand (A. 699-700), but would also result in improve-

ments in local recreational facilities (A. 701, 731), improve-

ments in the scenery of the waterfront (A. 701-704),

improvements in local water supply (A. 731, 739), and

benefits to the local economy (A. 696-697). Based upon

these findings, which were never questioned on review, the

Commission clearly would have the power to exercise its.

judgment that the project was “best adopted” to a com-

prehensive plan for development of the waterway (See

FPC Planning Status Report, Hudson River Basin, 1965)

even if there were a completely adequate alternative

power source. Certainly the Act throws no duty on either

applicant or the Commission to show the absence of such

alternative; to the extent the issue was relevant, it was

the burden of those proponents of*the denial of the

license to come forward with the evidence on this, and any

other issue, which in their views would militate denial.

In point of fact, even if it be assumed that the issues

of alternative sources of. power, effect on fish life and

excessive cost of underground transmission were part of

applicant’s prima facie case, there seems no contention

that there was not presented “substantial evidence” to

justify the Commission’s findings upon these points

(alternative source of power, A. 322-327, 332-368, 376-377,

396-398; underground transmission costs, A. 179, 189-194,

197-210, 225-234, 432-433; fish life, A. 26-28, 39-58, 493-497).

The rule espoused by the Court below, it is clear, con-

tradicts the purpose and intent of the Administrative

Procedure Act, which was itself the embodiment of a long

history of experience regarding the necessity of sensibly

limiting issues to those proposed and supported by the

parties, with the agency itself through its staff constituting

the party representing the public interest. Granting ~

dilatory powers to intervenors seeking to grind their

private axes is clearly not in the public interest, as the

Court below apparently assumed, but directly contrary

to the protection of those public interests for which admin-

istrative agencies are created. :

b) Does an administrative order fail to meet the tests

of the substantial evidence rule prescribed by the

Administrative Procedure Act and the Federal

Power Act, because the evidence of record was

proffered by the petitioner for such order?

The Administrative Procedure Act, as noted above,

throws upon the proponent for an order the burden of

proving a prima facie case. In addition both the Admin-

istrative Procedure Act (Section 10(¢)) and the Federal

‘Power Act (Section 313(b)) limit the jurisdiction of

Gourts of Appeals to review Commission action, by mak-

ing the Commission’s factual determinations conclusive

provided only that they are supported by “substantial

evidence.” The meaning of “substantial evidence” has

been well established in the decision of this Court. Con-

solidated Edison Co. v. NLRB, 305 U. S. 197 (1938); |

NLRB v. Columbia Enameling & Stamping Co., 306 U. S.

292 (1939). In the latter case, this Court stated (306

U. S. at 300);

“Substantial evidence is more than a scintilla, and

must do more than create a suspicion of the exist-

ence of the fact to be established. ‘It means such

relevant evidence as a reasonable mind might accept

as ee to —— a conclpsion,’ Consolidated

The opinion below appears to establish a new qualifica-

tion for the substantial evidence rule; substantial evi-

dence cannot be supplied by the evidence offered by the

proponent for a license nor can such evidence suffice to

create a prima facie case. Thus, the Court of Appeals

‘brushed aside the evidence with respect to cost of

345,000 volt underground transmission facilities pre-

sented by a Con Edison witness as “almost nothing”,

although it consisted of 48 pages of testimony and three

exhibits giving the most detailed cost analysis (R. 615-647,

716-730, 1834-1837 [A. 190-211, 224-234, 430-433]) by a

witness in charge of laying the only such facilities in

existence (A. 101). The testimony of another expert

witness on the adeqtiacy of gas turbines (A. 396-398) was

dismissed. as “self-serving” bécause the witness was an

“official of Con Edison.” (Opinion, 21a.) $

To apply to administrative agencies the ancient but now

obsolete common law rule which disqualified a party as a

witness (2 Wigmore on Evidence, 3rd Ed., $575) would fre-

quently make an agency’s task impossible. The present

ease clearly indicates the absurdity of result. The only -

underground cable in the United States of 345,000 volts

(the voltage of the line involved in this project) is that

which has been laid by Con Edison (A. 101). However,

in the view of the Court of Appeals, the detailed testi-

mony, presented by the engineer in direct charge of

constructing those lines (A. 189-194, 197-210, 225-234)

apparently does not constitute “substantial evidence”,

which would make the Commission’s findings on the sub-

ject conclusive under the statutes, because he is a Con

Edison official (Opinion 28a-29a).

‘The example is not unique. Probably most administra-

tive proceedings, whether they relate to rates, licenses or

enforcement, require the testimony of interested witnesses

on key issues. The Court of Appeals decision, while impos-

ing new burdens on agencies and applicants with respect

to adequacy of record, simultaneously cripples the agencies.

(and eee) in creating such a record.

c) Where an administrative agency has refused after

close of hearings to reopen a proceeding for

_ further testimony on a technical subject upon

which the agency has substantial background and

on which both sides have submitted evidence, do

Section 10(e) of the Administrative Procedure Act

and Section 313(b) of the Federal Power Act per-

mit a Court of Appeals to reverse upon the ground

that it does not consider the evidence of record

“meaningful”?

The Lurkis additional testimony on gas turbines as an

-alternative power source was proffered by Scenic Hudson

eleven months after the close of hearings and nearly

one month after the issuance of the license. The Court

of Appeals dismissed this laches by noting that such

testimony had been offered by another party two months

previously (but eight months after the close of hearings),

and stated that as “private attorney general” the appellant

below can “raise issues not personal to it” (Opinion 21a).

Even accepting this dubious elevation of private special

interest groups® to the position of “private attorney

general”, the decision below creates grave doubts as to

the ability of an administrative agency to regulate its

own proceedings in an orderly fashion, and is directly ~

contrary to the decisions of this Court in ICC v. Jersey

City, 322 U. S. 503 (1944) and United States v. Pierce

Auto Lines, 327 U. S. 515 (1946).

Even in the case of a lower trial court, a petition to

reopen a proceeding is a request for an extraordinary

form of relief. It is addressed to the sound discretion of

the tribunal, and will not be granted

“unless (1) the facts discovered are of such a nature |

that they would probably change the outcome; (2)

the facts alleged .are actually newly discovered

and could not have been discovered earlier by

proper diligence; and (3) the facts are not.merely

cumulative or impeaching” (English v. Mattson, 214

F. 2d 406, 409 (5th Cir. 1954)). 4

Neither Scenic Hudson’s application of April 8, 1965

(A. 777) nor the preceding tender to which the Court

9. It should be noted that referring to such groups as “non-profit

conservationist organizations” (Opinion 2a) does not change the

fact that they represent a special and in a strict sense a selfish

interest. They wish public resources to be used solely to further

their own. aesthetic or recreational interests in fishing, hiking or

similar activities. While such interests merit’ consideration, they

are no more representative of a public interest ‘than development

of resources for supplying power to the consumer and jobs to the

laborer. »It is the function of the FPC under Section 10(a) of

the Act, to weigh these sometimes competing selfish interests in

determining the overall public benefit (A. 700, 734).

& P%

of Appeals referred (A. 652-663) met any of these tests.

They offered merely further testimony by another witness,

a Mr. Lurkis, about gas turbines as an alternative source

of peaking energy for Con Edison. No reason was given

why he was not offered earlier; while he was ‘alleged to

have been out of the country during the- 1964 hearings,

he was in the United States,,and opining on this very

- subject, at least as early as November 19 and 20, 1964

(Opinion, 18a). It is obvious that Scenic Hudson in not

offering its testimony until April, 1965, five months after

having presented Mr. Lurkis at the legislative com-

mittee hearings, was merely waiting to see how the ©

Commission would decide; this. hardly meets the test of

- diligence, against which an application to reopen must

be weighed.

. The most basic failing, however, in the einilieatie was

that the evidence offered was purely cumulative. This -

was not an offer of a witness to some hitherto unknown

fact. It was an offer of an alleged expert to express

an opinion on a subject, gas turbines, as to which the

Commission had already heard substantial opinion evi-

dence from duly qualified experts, including one offered

by Scenic Hudson. . The application may be serached in

vain even for any novel theory which this “expert” would

proffer and which had not been heard and considered by

the Comniission. The proffered testimony in no way |

' dealt with the problem of spinning reserve (see p. 16,

supra), which is- one of the Cornwall project’s primary

pocianare (A. 121, 157-158, 289-290, 295, 368-369). It

failed tq meet. any of the numerous objections to gas

turbines demonstrated by the evidence of record (see p.

28 infra). Further, the Lurkis proposal required commit-

ment of a firm supply of gas for use in generation of

electricity, a use which the Commission noted “would

raise serious policy considerations,” citing F.P.C. v. Trans-

continental Gas Pipe Line Corp., 365 U. S. 1 (1961),

wherein this Court upheld the Commission’s determination

that. Con Edison could not acquire gas for such use (A.

714).

_ A regulatory commission,~with its expertise in its field,

_and its policy making function, must have at least as

much discretion on the question of reopening a proceed-

ing as does a court. Certainly on this record it can hardly -

be said that the Commission abused that discretion in .

refusing to hear Mr. Lurkis. To the contrary, as this

Court stated in J. C. C. v. apr City, 322 U. - 503, 514-515

(1944) :

«“* * * Administrative pemewer mere Fee of evidence—

particularly where the evidence is taken by: an

examiner, his report submitted to the parties, and -

a hearing held on their exceptions, to it—always

creates a gap between the time the Aecord i is closed

and the time’ the administrative decision is promul-

gated. This is especially true if the issues are

difficult, the evidence intricate, and the considera-

tion of. ‘the case deliberate and careful. If upon the

coming down of the order litigants might demand —

rehearings as a matter of law because some new

circumstance has arisen, some new trend has been .

observed, or some new fact discovered, there would

be little hope that the administrative process could

ever be consummated in an order that would not be

subject to reopening. It has been almost a rule

of necessity that. rehearings were not matters of. .

right, but were pleas to discretion. And likewise

it has been considered that the discretion to be

invoked was that of the body ene. the order,

and not that of a reviewing body.” .

This Court made the further comment that:

“The rule that petitions for rehearings before

administrative bodies are addressed to their own

discretion is uniformly accepted and seems to be

almost universally applied in other Federal courts”

— (322 U. 8. at 517),

and held that the fact that a proceeding was reopened for

modification did not require a rehearing of the basic i issue :

“* * * Nor can a litigant insist that a commission

may not take a second step in a rate-making process

without retracing all previous ones” (322 U. S. at

517).

Similarly, i in United States v. Pierce Auto Lines, 327 U.S.

515 (1946), this Court reversed a determination of a lower

court: which would have required the I.C.C. to reopen a

certification proceeding to consider possible changed con-

ditions. .In its »pinion, this Court distinguished Atchison,

T. @ 8. F. R. Co. v. United States, 284 U. S. 248 (1932),

saying (327 U. S. at 534-536) :

“That ¢ase, as has been indicated more than once,

was ‘promptly restricted * * * to its special facts,

United States v. Northern Pacific Ry. Co., 288 U.S.

490, and it stands virtually alone.’ [citing cases]

Exegpt in the single instance, it has been held

consistently that rehearings before administrative

bodies are addressed to their own discretion. Inter-

state Commerce Commission v. Jersey City, supra.

Only a showing of the clearest abuse of discretion

could sustain an exception to that rule. * * *

We think the court misconceived not only the

effects of the Commission’s action in these cases

but also its own function. It is not true, as the

opinion stated, that ‘* * * the courts must in a

_ litigated case, be the arbiters of the paramount

public interest.’ This is rather the business of the

Commission, made such by the very terms of the

statute. The function of the reviewing court is

much more restricted. It is limited to ascertaining

whether there is warrant in the law and the facts

for what the Commission has done. Unless in some

specific respect there has been prejudicial departure

from requirements of the law or abuse of the

Commission’s discretion, the reviewing court is

without authority to intervene. It cannot substitute

its own view concerning what should be done,

whether with reference to competitive considera-

tions or others, for the Commission’s judgment

upon matters committed to its determination, if

that has support in the record and the applicable

law” (emphasis supplied).

Indeed, it should be recognized that but for this

administrative discretion, the substantial evidence rule

prescribed by the statutes would become a dead letter.

This is so because any party objecting to a rule can

always dredge up additional evidence which he can offer

to contradict -the substantial evidence of record. Were

the Court of Appeals empowered to evaluate such pro-

ferred evidence and decide the Commission must receive

it, the deference which the statutes require must be paid

to administrative expertise, by prescribing the substantial

evidence rule, would be defeated.” |

The decisions in which the Courts have given due

deference to agency expertise are not mere exercises in

humility; they constitute a sensible recognition of realities.

The agencies not only have a depth of experience in a

#0. Washington Public Power Supply System v. FPC, Nos.

18728, 1 , and 18731 decided March 24, 1966 by the Court of

Appeals for the D.C. Circuit appears in direct conflict with the

instant case. The Court there rejected the Secretary of Interior’s

contention that the FPC was required to reopen a‘ licensing proceed-

ing and make an “independent staff study” regarding the propriety

of federal development.

98 ©

particular ‘field which is lacking in a court which must

deal with questions of law ranging from aviation to zoning,

but the agencies have technically trained staffs who can

evaluate technical data. ese.

The instant case clearly indicates the problem created

when a technically untrained Court attempts to decide

technical issues on the merits. ;

As the record indicates, the issue of whether gas tur-

bines present a practical alternative to the Cornwall proj-

ect as a source of power requires consideration of com-

plex and technical issues such as the capacity, starting time,

reliability, capital cost, B.T.U. rate, decibel levels, how

well they are suited for spinning reserve, and factors re-

lated to air pollution.” re

_11. The evidence before the Commission which it weighed in

arriving at its decision, included such issues as:

unavailability of gas turbines in units of sufficiently large

a ity to substitute for the 2,000,000 kilowatt Cornwall pro-

ject (A. 324-325, 350-352, 355, 360-362, 369, 397, 714) ;

inability of gas turbines to start quickly enough to fulfill the

spinning reserve (supra p. 16) function of the Cornwall project

(A. 325, 341-343, 353-355, 364, 397, 713) ;

relative novelty of gas turbines as ‘compared with the simple

and proven Francis-type hydroelectric turbines of the Cornwall

project, as effecting reliability of electric service to the public

(A. 156-158, 340-341, 352, 397, 571-572, 699) ;

relative capital costs of gas turbines and Cornwall, including

all auxiliary equipment, and how those are costs reflected in

annual costs to the consumer (A. 21, 121-123, 339-340, 356-359,

364, 424-427, 451);

relatively high rate of fuel consumption of gas turbines (ex-

pressed in the number of units of heat, British Thermal Units,

required to be supplied to the turbines as fuel in order for the

gas turbines to create a kilowatt hour of electric energy) as

making them prohibitively expensive to te as a substitute

for the Cornwall project (A. 325, 340, 352, 365-366, 451, 713) ;

the high noise levels (generally expressed in decibels) of the

jet engine components of gas turbines as affecting their accepta-

bility in an urban area (A. 351-352, 355, 360-362, 397-398) ;

the availability of natural gas in sufficient quantity to utilize

.in gas turbines, and the effect of the alternative fuel, kerosene,

in increasing air pollution, as compared to the.effect of Corn-

wall in alleviating such problem (A. 159-162, 355-356, 397,

699-700, 714).

The Commission and its staff of engineers could and

did properly evaluate the evidence presented on these ~

issues, in the light of its own background of expertise on

the specific subject of gas turbines. The reference of the

Court of Appeals to the extensive testimony on the sub-

ject of gas turbines as not being “meaningful” (Opinion

18a) reflects its lack of that technical assistance and

expertise which the Commission had in its own staff.

This may also account for the Court’s being impressed

with the unsworn statements” on this subject of an

“expert” who has never been subjected to cross-examina-

tion. As this Court has recognized, however, conflicting

opinions of experts are readily available, and are best.

weighed by the agency involved. In Railroad Comm’n of

Texas v. Rowan & Nichols Oi] Co., 310 U. S. 573 (1940),

a case involving oil field proration, the Court noted (310

U. S. at 583-584) :

“The record is redolent with familiar eaendlie

assertions by experts equally confident of contradic-

tory contentions. These touch matters of geography

and geology and physics and engineering * * *.

“Plainly these are not issues for our arbitrament.

The state was confronted with its general problem

of proration and with the special relation to it of the

small tracts in the particular configuration of the

East Texas field. It has chosen to meet these

problems through the day-to-day exertions of a

body specially entrusted with the task because pre-

sumably competent to deal with it * * *. It is not

for the federal courts to supplant the Commission’s

judgment even in the face of convincing proof that

a different result would have lates better.” (310 .

U. S. at 583-584).

12, The reference (Opinion 18a) to Mr. Lurkis’ “testimony”

before a legislative committee is in error; all that was given was an

_ unsworn statement, not subject to cross-examination.

9°

In the present case, the FPC noted that Mr. Lurkis’

testimony would at best be “a disagreement among ex-

perts” (A. 795), on a topic already fully considered. It

certainly could not be said to abuse its discretion _

rejecting such offer, unless some new rule of administra- —

tive procedure, some inverse rule of judicial expertise,

entitles a Court of Appeals to weigh conflicting technical

- evidence and substitute its own opinion (Opinion 18a-21a).

d) Did the action taken by the Court of Appeals

below in receiving and avowedly basing its de-

cision on matter not in the record before the

agency, and substituting its judgment for that of

an expert administrative body, constitute a sub-

stantial extension beyond the restricted jurisdiction

imposed on appellate courts by the Administrative

Procedure Act and the Federal Power Act?

The Court of Appeals below. received, as “a convenient

source of information” (Opinion 3a) the record of hear-

ings in May 1965 and the October 4, 1965 order resulting

therefrom. It relied upon that record, made subsequent

to the orders appealed from, in reaching its decision

(Opinion 26a-27a, 32a).

It has been uniformly held that the record filed in a

reviewing court shall include a transcript of the record

upon which the order appealed was entered and nothing

else. Norris & Hirshberg.v. SEC, 163 F.2d 689 (D.C.

Cir. 1947), cert. den., 333 U. S. 867 (1948); Hartford

Electric Light Co. v. Federal Power Commission, 131 F.

2d 953, 966 (2d Cir. 1942), cert. den., 319 U. S. 741 (1943),

Balazs v. Anderson, 77 F. Supp. 612 (D.C. N.D. Ohio

1948), ;

There is more than a mere conceptual difficulty in see-

ing how a Commission order can be held to be erroneous

on the basis of evidence not before the Commission at

the time such order was made; there are very practical

objections to such a procedure.

Reference to extraneous matter deprives the parties of

the protections of the testimonial process, including oath

and cross-examination. Even if the material being con-

sidered consists of sworn testimony, where the hearing

was specifically confined to limited issues (as at the May

1965 ‘hearings) the cross-examination will be similarly

limited.

The Administrative Procedure Act, Section 7(d) re-

quires an agency to make its decisions on the record

before it. Basic considerations of fairness should preclude

thé out-of-context use of extraneous material by a Court

reviewing such decision.

Furthermore, Scenic Hudson which persuaded the Court

to consider the record of hearings in May 1965 and the >

October 4, 1965 order, failed to take the statutory steps

of application for rehearing (Section 313(a) ), and peti-

tion for review (Section 313(b) ), which are the jurisdic-

tional prerequisites to the Court’s consideration of the

subject of those hearings. Such consideration was over

the strenuous objection of both the Commission and the

applicant for license. While the Court did not in express

terms reverse the order of October 4, 1965, its procedure

in reversing the other orders which were before it, in

practical effect annulled the October 4, 1965 order with-

out the jurisdictional prerequisites required by Section

313.

The receipt by the Court of such extraneous material

as a basis for disputing the findings of the agency is also

in direct conflict with the “substantial evidence” rule

prescribed by Section 10(e¥ of the Administrative Pro-

cedure Act and Section 313(b) of the Federal Power Act.

These statutes make the agency findings “conclusive” if

supported by substantial evidence, and the Court cannot

reverse even if it finds certain evidence to the contrary

in the record to be persuasive. It would be anomalous

if the Court were free to reverse such agency findings,

and substitute its own judgment, based upon conflicting

evidence not in the record.

e) Does the Administrative Pracedure Act, Section

10(e), and the Federal Power Act, §313(b), permit

a reviewing Court to weigh evidence and substitute

its judgment on factual issues for that of a Com-

mission?

A reading of the opinion below as compared to the

record before the Court below (see Statement herein, pp.

5-13 supra), demonstrates that the Court of Appeals

avoided the effect of the substantial evidence rule pre-

scribed by the two applicable statutes by finding the evi-

dence “self-serving” (Opinion 2la) or not “meaningful”

(Opinion 18a). It then proceeded to substitute its own

judgment for that of the Commission on factual issues,

not, to be sure, by saying that the converse finding. must

be made, but by remanding to the Commission with direc-

tions to affirmatively seek out contrary evidence.

If such a procedure is to be deemed consistent with the

statutory restrictions on the Court’s jurisdiction to review,

then a substantial inroad has been made in the substantial

svidence rule. A Court could as effectively kill an applica-

tion for a license by delay, by continuing to remand until

findings are made which accord with the Court’s views,

as it could by directly substituting its own findings of fact.

The latter course would be kinder to both the agency and

the parties. It is submitted, however, that neither should

be permitted.

CONCLUSION

For the foregoing reasons, this petition for a writ

of certiorari should be granted. — .

Respectfully submitted,

Ranpatu J. LEBoevr, Jr.,

Counsel for Petitioner.

Of Counsel:

Aurrep E. Fron,

LeBorvur, Lams & Lety,

March 28, 1966

‘

Appendix A—Opinion of the Court of Appeals

‘UNITED STATES COURT OF APPEALS

For tHe Seconp Circuit

No. 106—September Term,’ 1965.

(Argued October 8, 1965 Decided December 29, 1965.)

Tang

Docket No. 29853

_—_—_——E— ee

Scenic Hupson Preservation ConFerENcE, Town oF Cort-

LANDT, Town oF Putnam VALLEY and Town or YorRKTOWN,

Petitioners,

FreperaL Power ComMIssIoN,

Respondent,

and

CoNnsoLIDATED EpiIson Company oF New York, Inc.,

Intervener.

Before:

Lumparp, Chief Judge,

Waterman and Hays, Circuit Judges.

Petition, pursuant to Section 313(b) of the Federal

' Power Act, 16 U. S. C. §825 1 (b), to review and set aside

certain orders of the Federal Power Commission granting

intervener a license to construct a pumped storage hydro-

electric project. Pha

Orders set aside and case remanded for further pro-

ceedings in accordance with this opinion.

Luoyp K. Garrison, New York City (Simon H.

Rifkind, Albért K. Butzel, Paul, Weiss,

Rifkind, Wharton & Garrison, New York:

City, and Dale E. Doty, Washington, D. C.,

of_counsel), for Petitioner, Scenic Hudson

Preservation Conference.

SamveL. L. Siurzxy, Putnam Valley, N. Y.,

for Petitioner, Town of Putnam Valley.

Joun C. Turrix, Peekskill, N. Y. on the brief,

for, Petitioner, Town of Cortlandt.

JoHN R. Kisse and Raymonp Maretss, York-

town Heights, N. Y., on the brief, for

Petitioner, Town. of Yorktown.

JosEPHINE H. Kuz, Washington, D. C. (Rich-

ard A. Solomon, General Counsel for Fed-

-eral Power Commission, Howard E. Wah-

renbrock, Sol., Melvin Spaeth, Asst. Gen.

Counsel, Washington, D. C., on the brief),

for Respondent. -

Ranpatt J. LeBozvr, Jr, New York City

(LeBoeuf, Lamb & Lieby [sic], New York

City, on the brief), for Intervener.

Hays, Circuit Judge:

In this proceeding the petitioners are the Scenic Hudson

' Preservation Conference, an unincorporated association

consisting of a number of non-profit, conservationist’ or-

ganizations, and the Towns of Cortlandt, Putnam Valley

and Yorktown. Petitioners ask us, pursuant to §313(b) of

the Federal Power Act, 16 U. S. C. §825 L (b), to set aside.

3a : oe

three orders of the respondent, the Federal Power: Com.

mission :?

(a) An order of March 9, 1965 paver a license to the

intervener, the Consolidated Edison Company of New:

York, Inc., to construct a pumped storage hydroelectric

project on the west side of the Hudson River at Storm

King Mountain in Cornwall, New York; 2

(b) An order of May 6, 1965 denying petitioners’ appli-

cation for a rehearing of the March 9 order, and for the

reopening of the proceeding to permit the introduction of ©

additional evidence;

by the petitioners to expand the scope of supplemental

- hearings to include consideration of the practicality and

cost of underground transmission lines, and of the feasi-

bility of any type of fish protection device.

A pumped storage plant generates electric energy for ~ ’

use during peak load periods,? using hydroelectric units

1.. At oral argument petitioners made a motion to enlarge the

record by including in it the supplemental hearings conducted before

a Trial Examiner of the Federal Power Commission in May 1965.

These ‘hearings were limited to consideration of .the routes of over-

head transmission facilities and the design of fish protection devices.

Petitioners allege that the May hearings divulge information which

should have been. developed and considered by the Commission at

the time the license was granted. We are not being asked to review

the October 4, 1965 i a setting forth the Commission’s determina-

tion of the questions presented at the May hearings, but rather to

consider evidence compiled at the May hearings as a convenient

source of information from which inferences can be drawn about the

completeness of the March 9 record. : For this limited purpose we

have granted petitioners’ motion.

& Capacity for peak load periods is that part of a system’s gen-

erating equipment which is operated intermittently for short periods

pcan the hours of highest ek weekly, or seasonal kilowatt.

deman

, a3

. te 4a:

driven by water from a headwater pool or reservoir. The

contemplated Storm King project would be the largest of

its kind in the world. Consolidated Edison has estimated

its cost, including trazigmission facilities, at. $162,000,000.

The project would consist of three major components, a

storage reservoir, a powerhouse, and transmission lines.

The storage reservoir,® located over a thousand feet above

>the powerhouse, is to be connected to the powerhouse,

located on the river front, by a tunnel 40 feet in diameter.

The powerhouse, which is both a pumping and generating

station, would be 800 feet long and contain eight pump

generators.‘ -

Transmission lines would run under the Hudson to the

east bank and then underground for 1.6 miles to a switch-

ing station which Consolidated Edison would build at

Nelsonville in the Town of Philipstown. Thereafter, over-

head transmission lines would be placed on towers 100 to™

150 feet high and these would reqifire a path up to 125 feet

wide’ through Westchester and Putnam Counties for a

distance of some 25 miles until they reached Consolidated

Edison’s main connections with New York City.® .

3. The project’s reservoir would contain a surface area of 240

acres and a usable capacity df 25 ,000 acre-feet. A part of the space

which it would occupy is now occupied by a reservoir providing part

of the water supply for the Village of Cornwall. Another area con-

sisting of approximately 70 acres of pos within the Black Rock

Forest, a private forest reserve of Ha University, would also

be inundated by the proposed reservoir. Consolidated Edison has

offered appropriate ‘compensation for the acreage which would be

used/. .

4. _ According to plans ‘presented to te Kt Pore Commis-

sion three pumping generator units would be installed and go into

operation in mid-1967 and the remaining five in 1968.

5 However, the path might be even wider at corners, transporta-

tion points, access points, or points of an unusual character.

6. As has already been noted we are not now concerned with the

order of October 4, 1965 in which the Commission established the

exact toute of the transmission lines and the width of the right-of-way.

2 5a

During slack periods Censolidated Edison’s conventional

steam plants in New York City would provide electric

power for the pumps at Storm King to force water up the

mountain, through the tunnel, and into the upper reservoir.

In peak periods water would be released to rush down the

mountain and power the generators. Three kilowatts of

power generated in New York City would be necessary to

obtain two kilowatts from the Cornwall installation. When

pumping the powerhouse would draw approximately 1,080,-

000 cubic feet of water per minute from the Hudson, and

when generating would discharge up to 1,620,000 cubic feet

of water per minute into the river. The installation would

have a capacity of 2,000,000 kilowatts, but- would be so

constructed as to be capable of enlargement to a total of

3,000,000 kilowatts., The water in the upper reservoir may

‘be regarded as the equivalent of stored electric energy; in

effect, Consolidated Edison wishes to create a huge storage

battery at Cornwall. See Federal Power Commission,

National Power Survey 120-21 (1964).

The Storm King project has aroused grave concern

among conservationist groups, adversely affected: munici-

palities and various state and federal legislative units and

administrative agencies.”

7. For bills introduced in Congress for the purpose of preserving

the Hudson River and adjacent areas see House Introduction No.

H. R. 3012, 3918; Senate Introduction No. S. 1386. Heariggs were

held on May 10 and 11, 1965 before the House of Representativ

Subcommittee on Fisheries and Wildlife Conservation. House oF

Representatives, 89th Cong., Ist Sess., on Hudson River Spawning

Grounds.

The New York Joint Legislative Committee on Natural Resources

held hearings on November 19 and 20, 1964. See Preliminary Report

on the Joint Cegislative Committee on Natural Resources, On the

Hudson River Valley and the Consolidated Edison-Company Storm

King Mountain Project (issued February 16, 1965) (hereinafter cited

“Preliminary Report’). |

The Fish and Wildlife Service of the Department of the Interior

and the New York State Conservation Department have expressed

6a.

To be licensed by the Commission a prosepective

project must meet the statutory test of being “best

adapted to a eomprehénsive plan for improving or devel-

oping a waterway,” Federal Power Act §10(a), 16 U.S. C.

§803(a). In framing the issue before it, the Federal

Power Commission properly noted:

“[WlJe must compare the Cornwall project with any

alternatives that are available. If on this record Con

Edison has available an alternative source for meet-

ing its power needs which is better adapted to the

development of the Hudson River for all beneficial

uses, including scenic ation this application should

be denied.” ;

If the Commission is properly to discharge: its.

duty in this regard, the record on which it bases its deter-

mination must be complete. The petitioners and the public

at large have a right to demand this completeness. It is .

our view, and we find, that the Commission has failed to

compile a record which is sufficient to support its decision.

The Commission has ignored certain relevant factors and

failed to make a thorough study of possible alternatives

to the Storm King project. While the courts have no

authority to concern themselves with the policies of the

Commission, “it is their duty to see to it that the Com-

mission’s decisions receive that careful consideration which

the statute contemplates. See Michigan Consolidated Gas

Co. v. Federal Power Comm., 108 U..S. App. D. C. 409,

283 F. 2d 204, 226, cert. denied, Panhandle Eastern Pipe

Line Co. v. Michigan Consol. Gas Co., 364 U. S. 913; 81

concern about the effect of the project on the fish life of the Hudson.

See Part IV infra.

Numerous conservationist groups have interested themselves in

the project, and many of them filed formal petitions to intervene

before the

S. Ct. 276, 5 L.Ed. 2d 227 (1960). Petitioners’ application,

pursuant to §313(b), 16 U.S.C. §825 1 (b), to adduce addi-

tional evidence is granted.* We set aside the three orders

of the Commission to which the petition is addressed and

remand the case for further proceedings in accordance

with this opinion:

The Storm King project is to be located in an area of

- unique beauty and major historical: signficance. The high-

lands and gorge of the Hudson offer one of the finest

pieces of river scenery in the world. The great German

traveler Baedeker called it “finer than the Rhine.” Peti-

tioners’ contention that the Commission must take these

factors into considération in evaluating the Storm King

project is justified by the history of the Federal Power

Act.

The Federal Water Power Act of 1920, 41 Stat. 1063

(1920) (now Federal Power Act, 16 U. S. C. §79la et

seq.), was the outgrowth of a widely supported effort on

the part of conservationists to secure the enactment of a

complete scheme of national regulation which would pro- -

mote thescomprehensive develépment of the nation’s water

resources. See Federal Power Comm’n.v. Union Electric

Co., 381 U. S. 90, 98-99, 85 S. Ct. 1253, 14 L.Ed. 2d 239

(1965); First Iowa Hydro-Electric Coop. v. Federal

Power Comm’n, 328 U. S. 152, 180, 66 S. Ct. 906, 90 L.Ed.

1143 (1946). See generally Cushman, The Independent Reg-

ulatory Commission, 275-283 (1941); Pinchot, The Long

Struggle for Effective Federal Water Power Legislation,

_ 8. The hearings to which the third order refers have already been

held ; however, the relief petitioners seek is provided by our deter-

mination as to the second order.

14 Geo. Wash. L. Rev. 9 (1945).° It “was passed for the

purpose of developing and preserving to the people the

water power resources of the country.” United States

ex rel. Chapman v. Federal Power Comm’n, 191 F. 2d 796,

800 (4th Cir. 1951), aff’d, 345 U. S. 153, 73 S. Ct. 609,

97 L.Ed. 918 (1953).

9. The Supreme Court has noted that:

“The movement toward the enactment of the Act in 1920 may

be said to have taken its keynote from President Roosevelt’s

veto of a bill which would have turned over to private interests

important power sites on the Rainy River.” Federal Power

Comm'n v. Union Electric Co., 381 U. S. 90, 98-99 n. 11, 85

S. Ct. 1253, 1258 (1965).

President Roosevelt’s veto message read:

“We are now at the beginning of great development in water

power. Its use through electrical transmission is entering more

and more largely into every element of the daily life of the

people. Already the evils of monopoly are becoming’ manifest ;

already the experience of the past shows the necessity of caution

in making unrestricted grants of this great power.” 42 Cong.

Rec. 4698 (1908).

See also President Roosevelt’s veto of the James River bill, H. R.

17767, 60th Cong., 2d Sess. (1909), veto message, 43 Cong. Rec.

978 (1909); President Roosevelt’s letter appointing the Inland

Waterways Commission, 42 Cong. Rec. 6968 (1908), which read in

“Works designed to control our waterways have thus far usually

been undertaken for a single purpose, such as the improvement of

navigation, the development of power, the irrigation of arid lands,

the protection of lowlands from floods, or to supply water for

domestic and manufacturing purposes. While the rights of the

people to these and similar uses of water must be respected, the

time has come for merging local projects and uses of the inland

waters in a comprehensive plan designed for the benefit of the

entire country. Such a plan should consider and include all the

uses to which streams may be put, and should bring together

and coordinate the points of view of all users of waters.

“(The plans of the Commission should be formulated] in the

light of the widest knowledge of the country and the people, and

from the most diverse points of view.”

Congress gave the Federal Power Commission sweeping

authority anda specific planning responsibility. First

Iowa Hydro-Electric Coop. v. Federal Power Comm’n, 328

U. S. 152, 180-81, 66 S. Ct. 906, 919 (1946) (“instead of

thé piecemeal, restrictive, negative approach of the River

and Harbor Acts and other federal laws previously

enacted”); National Hells Canyon Ass’n v. Federal |

Power Comm'n, 99 U. S. App. D. C. 149, 237 F. 2d 777

(1956), cert. denied, 353 U. S. 924, 77 S. Ct-6$1, 1 L.Ed.

2d 720, rehearing denied, 353 U. S. 978, 77 S. Ct. 1054,

1 L.Ed. 2d 1139 (1957).

Section 10(a) of the Federal Power Act, 16 U. 8. C.

§803(a), reads:

“$803. Conditions of license generally.

All licenses issued under sections 792, 793, 795-

818, and 820-823 of this title shall be on the follow-

ing conditions:

(a) That the project adopted, . . . shall be such

as in the judgment of the Commission will_be best

adapted to a comprehensive plan for improving or -

developing a waterway or waterways for the use

or benefit of interstate or foreign commerce, for

the improvement and utilization of water-power

development, and for other beneficial public uses,

' ancluding recreational purposes; and if necessary

_ in order to secure such plan the Commission shall

have authority to require the modification of any

project and of the plans and specifications of the

project works before approval.” (Emphasis added.)

“Recreational purposes” are expressly included among

the beneficial public uses to which the statute refers. The

phrase undoubtedly encompasses the conservation of nat-

10a

ural resources, the maintenance of natural beauty, and the

preservation of historic sites.” See Namekagon Hydro Co.

v. Federal Power Comm’n, 216 F. 2d 509, 511-12 (7th Cir.

1954). All of these “beneficial uses,” the Supreme Court

has observed, “while unregulated, might well be contradic-

tory rather than harmonious.” Federal Power Cognm’n v.

Union Electric Co., 381 U. S. 90, 98, 85 S. Ct. 1293, 1258

(1965). In licensing a project, it is the duty of the

Federal Power Commission properly to weigh each factor.

In recent years the Commission has placed increasing

emphasis on the right of the public to “out-door recrea-

tional resources.” 1964 F. P. C. Report 69. Regulations

issued in 1963, for the first time, required the inclusion of

a recreation plan as part of a license application. F.P.C.

Order No. 260-A, amending $4.41 of Regulations under

Federal Power Act, issued April 18, 1963, 29 F. P. C. 777,

28 Fed. Reg. 4092. The Commission has recognized gen-

erally that members of the public have rights in our rec-

reational, historic and scenic resources under the Federal

Power Act. Namekagon Hydro Co., 12 F. P. C. 203, 206

(1954) (“the Commission realizes that in many cases where

unique and most special types of recreation are encoun-

tered a dollar evaluation is inadequate as the public interest

must be considered and it cannot be evaluated ade-

quately only in dollars and cents”). In affirming Name-

kagon the Seventh Circuit upheld the Commission’s denial

10. The clear intention of Congress to emphasize “recreational

rposes” is indicated by the fact that subsection (a) was amended

in 1935 by- substituting the present language “plan for improving or

developing * * * including recreational purposes” for “scheme of

improvement and utilization for the purposes of navigation, of water-

power development, and of other beneficial public uses.” Senate

Rep. No. 621, 74th Cong., Ist Sess., page 45. stated that the amend-

ment was intended to add “an express provision that the Commission

may include consideration of recreational purposes.”

lla

of a license, to an otherwise economically feasible project,

because fishing, canoeing and the scenic attraction of a

“beautiful stretch of water” were threatened.. Namekagon

Hydro Co. v. Federal Power Comm’n, 216 F. 2d 509, 511-12

(7th Cir. 1954).

a Ross said in his dissent in the present

: “[{I]t appears obvious that had this area“of the

‘Hodson Highlands’ been declared a State or National

park, that is, had the people in the area already spoken,

we probably would have listened and might well have

refused to pation it.”

Il. ,

_ Respondent argues that “petitioners do not have stand-

ing to obtain review” becatise they “make no claim of any

— economic injury resulting from the Commission’s

action.”

Section 313(b) of the Federal Power Act, 16 U. S. C.

$825 1 (b) reads:

“(b) Any party ‘to a proceeding der this chap-

ter aggrieved by an order issued b ed Commission

in such proceeding may obtain a review of such

order in the United States court of appeals for any

ciréuit wherein the licensee or — ecu, Yes

which the order relates is located. .

The Commission takes a narrow view of - meaning

of “aggrieved party” under the Act. The Supreme Court

has observed that the law of standing is a “complicated

specialty of federal jurisdiction, the solution of whose

problems is in any event more or less determined by

the specific circumstances of individual situations. . . .”

United States ex rel. Chapman v. Federal Power Comm’n,

345 U. S. 153, 156, 73 S. Ct. 609, 612, 97 L. Ed. 918 (1953).

: 12a:

Although a “case” x Ercan which is otherwise

lacking cannot be created by statute, a statute may create

new interests or rights and thus give standing to one who

would otherwise be barred by the lack of a “case” or

“eontroversy.” The “case” or “controversy” requirement ~

of Article III §2 of the Constitution does not require that

an “aggrieved” or “adversely affected” party have a per-

sonal economic interest. See State of Washington Dept. of

Game v. Federal Power Comm’n, 207 F. 2d 391 (9th Cir.

1953), cert. denied, 347 U. S. 936, 74 S. Ct. 626, 98 L. .

Ed. 1087 (1954); Reade v. Ewing, 205 F. 2d 630 (2d Cir.

53); ef. Scripps-Howard Radio, Inc. v. Federal Commu-

‘nications Comm’n, 316 U. S. 4, 62 S. Ct. 875, 86 L. Ed.

1229 (1942); Federal Communications Comm’n, v. Sanders

Bros. Radio Station, 309 U. S. 470, 642, 60 S. Ct. 693, 84

L. Ed..869 (1940) ; International Union of Electrical, Radio .

and Machine Workers v. Underwood Corp., 219 F. 2d 100,

103 (2d Cir. 1955); Associated Industries, ‘Inc. v. Ickes, 134

F. 2d 694 (2d Cir.), vacated as moot, 320 U. S. 707, 64 S.

Ct. 74, 88 L. Ed. 414 (1943); Jaffe, Standing to Secure

Judicial Review: Private Actions, 75 Harv. L. Rev. 255

(1961). Even‘ in cases involving original standing to sue,

the Supreme Court has not made economic injury a pre-

requisite where the plaintiffs have shown a direct personal

interest. See, e.g., School District of Abington Township

v. Schempp, 374 U. S. 203, 83 S. Ct. 1560, 10 L. Ed. 2d 844

(1963) ; Engel v. Vitale, 370 U. S. 421, 82 S. Ct. 1261, 8 L.

Ed. 2d 601 (1962); Zorach: v. Clie, 343 U. 8. 306, 72

S. Ct. 679, 96 L. Ed. 954 (1952).

In State of Washington Dept. of Game v. Federal Power

Comm’n, 207 F. 2d 391, 395 n. 11 (9th Cir. 1953), cert.

denied, 347 U. S. 936, 74 S. Ct. 626 (1954), the Washington

- State Sportsmen’s Council, Inc., a non-profit organization

13a

of residents, the State of Washington, Department of

Game, and the State of Washington, Department of Fish-

eries, opposed the construction of a dam because it threat- —

ened to destroy fish. The Federal Power Commission

granted the license; the interveners applied for a rehearing

which the Commission ‘denied. Petitioners asked for re-

- view under §313(b) and the court upheld their standing,

noting:

“All are ‘parties aggrieved’ since they claim that

the Cowlitz Project will destroy fish in [sic] which

they, among others, are interested in protecting.”

The Federal Power Act seeks to protect non-economic

as well as economic interests. Indeed, the Commission

recognized this in framing the issue in this very case:

“The project is to be physically located in a gen-

eral area of our nation steeped in the history of the

American Revolution and of the colonial period. It

is also a general area of great scenic beauty. The

principal issue which must be- decided is whether

the project’s effect on the scenic, historical and

recreational values of the area are such -that we

should deny the application.”

In order to insure that the Federal Power Com-

mission will adequately protect the public interest in the

aesthetic, conservational, and recreational aspects of power

development, those who by their activities and conduct

have exhibited a special interest in such areas, must be

held to be included in the class of “aggrieved” parties

under §313(b). We hold that the Federal Power Act

gives petitioners a legal right to protect their special

11. - See discussion in Part I, supra.

l4a

interests. See State of Washington Dept. of Game v.

_ Féderal Power Comm’n, supra.

At an earlier point in these proceedings the Commission

apparently accepted this view. Consolidated Edison

strongly objected to the petitioners’ standing, but the

Commission did not deny their right to file an application.

for a rehearing under §313(a) of the Act which ‘also

_ speaks in -terms of “aggrieved parties.””

oe Moreover, petitioners have sufficient economic interest

to establish their standing. The New York-New Jersey

Trail Conference, one of the two conservation groups

that organized Scenic Hudson, has some seventeen miles

of trailways in the area of Storm King Mountain.

Portions of these trails would be inundated by the con-

. struction of the project’s reservoir. ;

_/The primary transmission. lines are an integral part

‘of the Storm King project. Seé Federal Power Act

§$3(11), 16 U. S. ©. §796(11).% The towns that are co-

12. Federal Power Act, §313(a), 16 U. S. C. §825 J (a) reads:

“8825 J. Rehearings; court review of orders

‘(a) Any person, State, municipality, or State commission

aggrieved by an order issued by the Commission in a proceeding

under this chapter to which such person, State, municipality, or

State commission is a party may apply for a rehearing within

- thirty days after the issuance of such order.”

“““[P]roject’ means complete unit of improvement or develo

ment, consisting of a power house, all water conduits, all dams

and appurtenant works and structures (including navigation

structures) which are a part of said unit, and all storage, divert-

ing, or forebay reservoirs directly connected therewith, the

primary line or lines transmitting power therefrom to the point

of junction with the distribution system or with the intercon-

nected primary transmission system, all miscellaneous structures

used and useful in connection with said unit or any part thereof,

and all water-rights, rights-of-way, ditches, dams, reservoirs,

lands, or interest in lands the use and occupancy of which are

necessary or appropriate in the maintenance and operation of

such unit,” — added. )

‘3. sili

petitioners with Scenic Hudson have standing because the

transmission lines would cause a decrease in the proprie-

tary value of -publicly ‘held land, reduce tax revenues

collected from privately held land, and significantly inter-

fere with long-range community planning. See ‘City of

Pittsburgh v. Federal Power Comm’n, 99:U. S. App. D. C.

113, 237 F.. 2d ‘741, 748 (1956). Yorktown, for example,

fears that the transmission, lines would run over municipal

_ land selected for a school site, greatly decreasing its value-:

and interfering with school construction. Putnam Valley

- faces similar interference with local mate and a sub-

stantial decrease in land tax revenues."* '

We see no justification for the Commission’ 8 inar that

our determination will encourage “literally thousands” to

intervene and seek review in future proceedings... We re-

jected a similar contention: in Associated Industries, Inc.

v. Ickes, 134 F. 2d 694, 707 (2d Cir.), vacated as moot, 320 -

U. S. 707, 64 S. Ct. 74. (1943), noting that ‘no such

' horrendous possibilities” exist. “Our experience with *

public actions confirms the view that the expense and

vexation of legal. proceedings is not lightly undertaken. ©

In any ease, the Federal Power Act creates-no absolute

right of intervention ; $308(a), 16 U.S. C. §$825g(a), reads:

“In any proceeding ‘before it, the Commission, in

accordance with, such rules and mr, zulations as it

14. Permitting the Commission, for reasons of convenience and

practicality, to limit the licensing proceeding and to hold for later

determmation the route of transmission lines, does not divest the

petitioning towns of their standing. If we accepted the Commission’s .

contrary’ argument we would be required to withdraw from the.

towns their right to challenge the entire integrated project.

Although the order of October 4, 1965 is got before us for review,

. ' we note that the Commission has conceded in its Supplemental Brief

‘that Putnam Valley is in the same Position as before the order and

that the transmission route chosen “might be sufficient to cause

aggrievement” to petitioner, Yorktown. ~~

Lf {

16a Fs

may prescribe, may admit as a party any interested.

State, State commission, municipality, ‘or any rep-

resentative of interested consumers or security

holders, or any competitor.of a party to such pro-

ceeding, or any other person whose participation

in the proceeding may be in the public interest.” —

Since the right to seek review under $313(a) and (b) is

limited to a “party” to the Commission proceeding, the

Commission has ample authority reasonably to limit those

eligible. to intervene or to seek review. See Alston Coal

Co. v. Federal Power Comm’n, 137 F. 2d 740, 742 (10th

cr. 1943). Representation of common interests by an or-

ganization such as Scenic Hudson serves to limit the num-

ber of those who might otherwise apply for intervention

and serves to expedite the administrative process.

IIT.

The Federal Power Act $313(b), 16 U. S. C. $825 l ae

reads in part:

“(b) If an* party shall apply to the court for leave

to adduce additional evidence, and shall show to the

satisfaction of the court that such. additional evi-

dence is material and that there were reasonable

grounds for failure to adduce such evidence in the

proceedings before the Commission, the court may

- order such additional evidence to be taken before

the Commission and to be adduced upon the hearing

in such manner and upon such terms and conditions

as to the court may seem proper.”

The Commission in its opinion recognized that in con-

nection with granting a license to Consolidated Fdison it

“must compare the Cornwall project with any alternatives

that are available.” There is no doubt that the Commis-

17a

in is under a statutory duty to give full consideration to

alternative plans. See Michigan Consolidated Gas Co. v.

Federal Power Comm., 108 U. S. App. D.C. 409, 283 F. 2d

204, 224-226, cert. denied, Hastern Pipe Line Co. v. Mich-

igan Consol. Gas Co., 364 U. S. 913, 81 S. Ct. 276, 5 L. Ed.

2d 227 (1960); City of Pittsburgh v. Federal Power

Comm’n, 99 U. S. App. D.C. 118, 237 F. 2d 741 (1956).

In City of Pittsburgh, three months after the hearings

were closed, the petitioners attemptéd to present to the

Commission memoranda supporting an alternative sugges-

tion. The District of Columbia Circuit set aside the Com-

mission’s order and remanded the case with directions to

improperly rejected as “untimely” evidence concerning

the proposed alternative. The court stated that:

“The existence of a more desirable alternative is

one of the factors which enters into a determination

of whether a particular proposal would serve the

public convenience and necessity. That the Com-

mission has no authority to command the alterna-

tive does not mean that it cannot reject the

[original] proposal.” City of Pittsburgh v. Federal

Power Comm’n, 99 U. S. App. D.C. 113, 237 F. 2d

741, 751 n. 28 (1956).

~ In the present case, the Commission heard oral argu-

ment on November 17, 1964, on the various exceptions to

the Examiner’s report. On January 7, 1965 the testimony

of Mr. Alexander Lurkis, as to the feasibility of an alter-

native to the project, the use of gas turbines, was offered

to the Commission by Hilltop Cooperative of Queens, a

taxpayer and consumer group. The petition to intervene

and present this new evidence was rejected on January 13,

1965 as not “timely.” It was more than two months after .

18a

the offer of this testimony, on March 9, 1965, that the

Commission issued a license to Consolidated Edison.

When Mr. Lurkis’s testimony was subsequently reoffered

by the petitioners on April 8, 1965, it was rejected because

it represented “at best” a “disagreement between experts.”

On the other hand, we have found in the record no mean-

ingful evidence which contradicts the proffered testimony

supporting the gas turbine alternative.

Mr. Lurkis is a consulting engineer of thirty-nine years

experience. He has served as Chief Engineer of the New

York City Bureau of Gas and Electric, in charge of a

staff of 400, and as Senior Engineer of the New York City

Transit Authority, where he supervised the design and

construction of power plants.** The New York Joint Legis-

lative Committee on Natural Resources,’ after holding

hearings on the Storm King project on November 19 and

20, 1964, summarized Mr. Lurkis’s testimony as follows:

“Mr. Alexander Lurkis * * * presented a detailed

proposal for using gas turbines. This, he claimed,

would meet the alleged peaking need of Con Ed and

result in a saving for its customers of $132,000,000.

The Committee has learned that similar gas turbine

installations are now in use or proposed for use by

a number of progressive electric utilities throughout

the nation. In addition to meeting the alleged peak

power needs and saving money for the ‘ratepayer,

the gas turbines proposed by Mr. Lurkis would

have the following —

15. Mr. Lurkis has made nimerous studies of utility adequacy

including a survey of “blackouts” in New York during 1959 and

1961, which resulted in revisions of the Consolidated Edison system.

He is a member of many professional associations and has published

numerous articles and presented many papers on electrical engineer-

ing subjects.

16. A total of 107 witnesses were heard; the large majority

objected to the project.

19a bs

‘1) Permit the company greater flexibility in

meeting the power needs of its service area. Admit-

tedly, technological developments in power produc-

tion are changing and improving this field at such

a rapid rate that it may well be entirely revolution-

ized in 10 to 15 years. There are obvious ad-

vantages in the gas turbine installations. Small

installations can be added as needed to meet demand.

This, in contrast to a single, giant, permanent

installation such as Con Ed proposes at Storm King

Mountain, which would tie the technology and in-

vestment of one company to a method of power

production that might be obsolete in a few years.

_ +2) Keep the power production facilities within

New York City. This would not only avoid the

desecration of the Hudson Gorge and Highlands,

but, also, would eliminate the great swathe of

destruction down through Putnam and Westchester

Counties and their beautiful suburban communities.”

Preliminary Report at 6.

The Committee report, issued on February 16, 1965,

three weeks before the license to Consolidated Edison was

granted, concluded:

“T]he whole situation involved in the Consolidated

Edison Storm King Mountain project, and the

protection of the Hudson River and its shores,

requires further and extensive study and investiga-

tion.

_* & * * *

This Committee goes on record as opposing Con

Ed’s application until there has been adequate study

of the points indicated in this report.” Preliminary

' Report at 8.

Mr. Lurkis’s analysis was based on an intensive study

of the Consolidated Edison system, and of its peaking

20a

needs projected year by year over a fifteen year period.

He was prepared to make an economic comparison of a

gas turbine system (including capital and fuel operating

costs) and the Storm King pumped storage plant. More-

over, he was prepared to answer Consolidated Edison’s

objections to gas turbines by indicating:

(1) that gas turbines could meet Consolidated Edison’s

reserve needs;

(2) that the blackouts of is and 1961 were caused by

breakdowns in distribution, not by a lack of power;

(3) that gas turbines would avoid the hazards of

weather damage to high transmission lines involved in the

Storm King project;

(4) that since 3 kilowatts of power must be generated

by steam plants in New York City in order to get 2 kilo-

watts of power from the Storm King project, gas turbines

would be even more useful than the project in reducing air

‘pollution ;

(5) that noise from the turbines would be at acceptable

industrial levels.

Other benefits envisioned from gas turbines were higher

reliability, increased system flexibility, and possible savings

in transmission line investment.’?

17. Citing Federal Power Comm'n v. Transcontinental Gas Pipe

Line Corp., 365 U. S. 1, 81 S. Ct. 435, 5 L. Ed. 2d 377 (1961)

the Commission asserts that “serious policy questions” would be

raised by the use of gas, for the generation of electrical energy.

But the serious questions alluded to do not excuse the Commission’s

failure to develop and hear pertinent evidence on the alternative.

As to the use of gas, the Supreme Court held in Transcontinental

that “‘a flexible balancing process, in the course of which all factors

are weighed prior to final determination,” is needed in each case.

Id. at Ba 81 8. Ct. at 447.

21a

Aside from self-serving general statements by officials

of Consolidated Edison, the only testimony in the record

bearing on the gas turbine alternative was offered by

Ellery R. Fosdick. Fosdick’s hastily prepared presenta-

tion considered turbines driven by steam and liquid fuel

as well as gas; his direct testimony occupied less than ten

pages of the record.’® Fosdick’s testimony was too scanty

to meet the requirement of a full consideration of alter-

natives. Indeed, under the circumstances, we must con-

clude that there was no significant attempt to develop

evidence as to the gas turbine alternative; at least, there

is no such evidence in the record. e

The Commission argues that petitioners made “no @

tempt to secure additional testimony.” Yet the record indi-

cates that more than two months before the license was

granted the Commission summarily rejected the offer of

Mr. Lurkis’s testimony. ‘

It is not our present function to evaluate this evi-

‘dence. Our focus is upon the action of the Commission.

The fact that Lurkis’s testimony was originally offered

by a non-petitioner, Hilltop Cooperative, is irrelevant. A

party acting as a “private attorney general” can raise

issues that are not personal to it. See Associated Indus-

tries, Inc. v. Ickes, 134 ¥. 2d 694, 705 (2d Cir.), vacated

as moot, 320 U. S. 707, 64 S. Ct. 74, 88 L. Ed. 414 (1943);

Jaffe, Standing to Secure Judicial Review: Private Ac-

tions, 7) Harv. L. Rev. 255, 283 (1961) (“the right to

18. Fosdick conceded that he had no firsthand knowledge of the

Consolidated Edison system or its requirements. He had been unable

to make a study of the economics of alternative methods of generating

peaking power, nor had he made an examination of New York City

power needs. His testimony on air pollution, which was favorable to

Consolidated Edison, was addressed to a question on the “burning of

kerosene” and not of natural gas, a non-pollutant.

22a |

attack an order resting on a record made by others, or

no record at all, could be valuable”).

Especially in a case of this type, where public interest

and concern is so greag. the Commission’s refusal to

receive the Lurkis testimony, as well as proffered informa-

tion on fish protection devices and underground trans-

mission facilities,’® exhibits a disregard of the statute and

~—* of judicial mandates instructing the Commission to

probe all ‘feasible alternatives. Michigan Consolidated

Gas Co. v. Federal Power Comm., 108 U. S. App. D.C.

~ 409, 283 F. 2d 204,224, 226, cert. denied, 364 U. 8. 913,

81 S. Ct. 276,5 L. Ed. 2d 227 (1960); City of Pittsburgh —

v. Federal 5 i Comm., 99 U. S. ae D.C. 113, 237

F. 2d and (1956).

IV.

The Federal Power Commission argues that having

intervened “petitioners cannot impose an affirmative

burden on the Commission.” But, as we have pointed

out, Congress gave the Federal Power Commission a

specific planning responsibility.’ See Federal Power Act

§10(a), 16 U. S. C7§803(a). The totality of a project’s

immediate and long-range effects, and not merely the engi-

neering and navigation aspects, are to be- considered in a

licensing proceeding. As Commissioner Ross said in his

dissent :

“T do feel the public is entitled to know on the

record that no stone has been left unturned. How

much better it would be if the public is clearly

advised under oath and cross examination that there.

truly is no alternative? The thread running through

this case has been that the applicant is entitled to

19. See Part IV infra.

23a

a license upon making a prima facie case. My own

personal regulatory philosophy compels me to reject

this approach. This Commission of its own motion,

.ghould always seek to imsure that a full and ade-

quate record is presented-to it. A regulatory com-

mission can insure continuing ‘confidence in its - >

decisions only when it has used its staff and its

own expertise in manner not possible for the unin-

formed and poorly financed public. With our inti- -

mate knowledge of other systems and ‘to a lesser

extent of their plans, it should be possible to resolve

all doubts as to alternative sources. This may have

been done but the record doesn’t speak. Let it

do so.” 3

In this case, as in many others, the Commission has

claimed to be the representative of the public interest.

This role does not permit it to act as an umpire blandly

calling balls arid strikes for adversaries appearing before

it; the right of the public must receive active and affirma-

tive protection at the hands of the Commission.

This court cannot and should not attempt to substi-

tute its judgment for that of the Commission. But we

must decide whether the Commission has correctly dis-

charged its duties, including the proper fulfillment of its

planning function in deciding that the “licensing of the

project would be in the overall public interest.” The Com-

mission must see to it that the record is complete. The

Commission has an affirmative duty to inquire into and

consider all relevant facts. See Michigan Consolidated

Gas Co. v. Federal Pewer Comm., 108 U. S. App. D. C.

409, 283 F. 2d 204, 224, 226, cert. denied, 364 U. S. 913,

81 S. Ct. 276 (1960) ; Isbrandtsen Co. v. United States, 96

F. Supp. 883, 892 (S. D. N. Y. 1951), aff’d by an equally

divided court, A/S J. Ludwig Mowinckels Rederi v.

Isbrandtsen Co., 342 U. S. 950, 72 S. Ct. 623, 96 L. Ed.

706 (1952); Friendly, The Federal Administrative Agen-

cies, 144 (1962); Landis, The Administrative Process,

36-46 (1938); ef. City of Pittsburgh v. Federal Power

Comm., 99 U. S. App. D.C. 113, 237 F. 2d 741 (1956).

In Michigan Consolidated Gas Co. v. Federal Power

Comm., supra 283 F. 2d at 224; the Court of Appeals of

the District of Columbia, in criticizing the Federal Power

Commission for refusing to consider an alternative and

for failing to take the initiative in seeking information,

observed: —

“Even assuming that under the Commission’s rules |

Panhandle’s rejection, of the settlement rendered

the proposal ineffective as a settlement, it could

not, and we believe should not, have precluded the

‘Commission from considering the proposal on its

merits. Indeed, the proposal appears prima facie

to have merit enough to have required the Com-

mission at some stage of the proceeding to consider

it on its own initiative as an alternative to total

abandonment.” (Emphasis added.)

‘On rehiuring the court added:

“In viewing the public interest, the Commission’s

vision is not to be limited to the horizons of the.

private parties to the proceeding.

. Where,’ as here, a regulatory agency has’ ignored

~~ factors which are relevant to the public interest,

the seope of judicial review is sufficiently broad to

order their consideration. These limits are not to

be confused with the narrower ones governing

review of an agency’s conclusions reached upon

proper consideration of the relevant factors.” Id.

at 226.

25a

Judge Frank, in response to: a submission similar to the

one > made heré, said:

“This is a somewhat surprising contention, to” be

contrasted with the following views of Commis-

sioner Aitchison of the Interstate Commerce Com-

mission concerning the obligations of administra-.

tive agencies: ‘* * * The agency does not do its

_duty-when it merely decides upon a poor or non-

' representative record. As the sole representative

of the public, which is a third party in these pro-

ceedings, the agency owes the duty to investigate

all the pertinent facts, and to see that they are

adduced when the parties have not put them in

_***, The agency must always act upon the record

made, and if that is not sufficient, it should see the

record is supplemented before jt acts. It must

always preserve the elements of fair play, but it is

not fair play for it to create an injustice, instead

of remedying one, by omitting to inform itself and

by acting ignorantly “when intelligent action is

poem * * *7..

Isbrandtsen Co. v. United States, 96 F. Supp. 883, 892

(S. D. N. Y. 1951), affirmed by an‘ equally divided court,

A/S J. Ludwig Mowinckels Rederi v. Isbrandtsen Co., 342

U. S. 950, 72 S. Ct. 623 (1952).

And Dean Landis said:

“For [the administrative] process to be mae in

a particular field, it is imperative that controversies

~ be decided as ‘rightly’ as possible, independently of

the formal record: the parties themselves pruduce.

The ultimate test of the administrative is the policy

parties of the disposition of a controversy on a

record of their own making.” Landis, The Admin-—

istrative Process 39 (1938).

> J

26a

In addition to the Commission’s failure to receive or

develop evidence conceruing the gas turbine alternative,

there are other instances where the Commission should

have acted affirmatively in order to make a complete -

record.

The’ Commission neither investigated the use of inter-

connected power as a possible alternative to the Storm

King project, nor required Consolidated Edison to supply

such information. The record sets forth Consolidated

Edison’s interconnection with a vast network of other

utilities, but the Commission dismissed this alternative by

noting that.“Con Edison is relying fully upon such inter-

connections in estimating its future available capacity.”

However, only ten pages later in its opinion the Commis-

sion conceded:

“Of significant importance, in our opinion, is the

absence in the record, or the inadequacy, of infor-

mation in regard to Con Edison’s future intercon-

nection plans; its plans, if any, for upgrading exist-

ing transmission lines to higher voltages ; and of its

existing transmission line grid in this general area

and its future plans.”

‘Moreover, in its October 4, 1965 order, the Commission

in explaining how Consolidated Edison would be able to

send “substantial amounts” of Storm King power to up-

state New York and New England power companies, each’

_ December, said:

“ample spinning reserve would be available during

the winter from the interconnected companies in

‘New Jersey and Pennsylvania, including the ‘mine-

mouth’ plants. Thus, even at times of the greatest

diversion of Cornwall power, Con Edison would

- have other power sources immediately available to

it for its peak requirements.”

Ween te He A PAB er

27a

If interconnecting power can replace the Storm King

project in Deécernber, why was it not considered as a

permanent alternative? MS

Commissioner Ross in his dissent said:

“In my opinion, the only true alternative that would

likely be as economic as the proposed project would

be purchased peaking power. There are two pos-

sibly differing sources; one would be purchasing

pumped storage or normal hydro peaking which may

be in the process of development in New England;

or secondly, purchasing steam peaking power from

or in Appalachia.”

There is n% evidence in the record to indicate that either

the Commission or Consolidated’ Edison ever ‘seriously

considered this alternative.” Nor is there any evidence

that a combination of devices, for example, gas turbine and

interconnections, were considered. Indeed, the Gommis-

sion stated in its brief that it is “of doubtful relevance

to the present case whether there are practical alternatives

to an appropriate use of water power by which Con Ed

could meet its anticipated needs for peaking power with

generally comparable economy.” The failure of the Com-

mission to inform itself of these alternatives cannot be

reconciled with its planning responsibility under the Fed-

eral Power Act. —

20. At page’ 39 of the record Mr. M. L. Waring, senior vice-

president of Consolidated Edison, described the inter-connection,

system but failed to answer the question: “Would this not be

economical substitute for the Hmped storage ae ?” ‘In later

testimony*to a similar question ‘he responded: “Yes, [other sources

of power] are available, but not in sufficient quantity.”

But there was no evidence introduced as to the amount of power

available.

| . - . a

“new large scale thermal stations in Pennsylvania ,

28a

In its March 9 opinion the Commission postponed a deci-

sion on the transmission route to be chosen until the May

1965 hearings were completed. Inquiry into the cost of

putting lines underground was precluded because the May

hearings were limited to the question of overhead trans-

mission routes. The petitioners’ April 26, 1965 motion to

enlarge the scope of the May hearing was denied. The

Commission insisted that the question of underground costs

had been “extensively considered.” We find almost

nothing in the record to support this statement.”

Consolidated Edison estimated the cost of underground

transmission at seven to twelve times that of overhead

lines.22_ These estimates were questioned by the Commis-

sion’s own staff, which pointed out that Consolidated Edi-

“son’s estimates incorrectly assumed that the underground

route would be the same as the overhead; in fact, an under-

ground route along the New York Central right-of-way

_ would be clearly less costly than the estimate, since there

21. The Commission contends that petitioners failed to raise the

issue of underground transmission line costs, and the bearing of these

costs on the licensing of the project, in their Application for Rehear-

ing. But in listing Commission errors, petitioners said:

“finaliy it excluded from the consideration of . . . where to

put the transmission lines the deeper questions of . . . what

the cost would be of putting additional portions of the transmis-

sion lines underground.” :

The Philipstown Citizens Association, in its Application for Re-

hearing, specifically urged that the “Commission committed error in

excluding further consideration of underground transmission at the

remand hearings which started on May 4, 1965.”

As we said earlier, the petitioners may raise issues which are not

personal to them.

22. Compare Federal Power Commission, National Power Survey

156 (1964). (“Efforts are frequently made to require utilities to

place transmission circuits underground. In some circumstances

buried cables are advantageous, but the usual cost is 5 to 10 times

that of overhead circuits.” )

29a

are no large differences of elevation requiring special

pumping facilities and no new cross-country right-of-way

would be necessary. Moreover, the staff noted that the

estimates were based on Censolidated Edison’s experience

in New York, where excavation and other costs are higher.

The Examiner noted the staff’s reservations in his opinion,

but since no alternative figures had been presented, he

accepted those submitted by Consolidated Edison, as did

the Commission.”*

Consolidated Edison witnesses testified that the Storm

King project would result in annual savings of $12,000,000

over a steam plant of equivalent capacity. Given these

savings, the Commission should at least have inquired into

the capital and annual cost of running segments of the

transmission line underground: in those areas where the

overhead structures would cause the most serious scenic

damage. We find no indication that the Commission seri-

ously weighed the aesthetic advantages of underground

transmission lines against the economic disadvantages.

At the time of its original hearings, there was sufficient

evidence before the Commission concerning the danger to

fish to warrant further inquiry. The evidence included a

letter from Kenneth Holum, Assistant Secretary of the De-

23. The Commission did state the underground costs would be

prohibitive “except for short distances,” but no substantiation of this

position was offered nor was a definition of short distance given.

24. Commissioner Ross remarked that “the tactics of [Consoli-

dated Edison] were obviously dictated by the precedential effect of

underground transmission.” See testimony of senior vice-president

Waring. “[T]here are thousands of miles of transmission and dis-

tribution lines elsewhere in our territory and in the State of New

York, where there is just as much or more reason to put the trans-

mission lines underground as there is here.”

This approach is unacceptable. Each case must be judged on its

own merits. The area involved here is an area of “unique beauty,”

as Commissioner Ross noted in his dissenting opinion.

30a

partment of the Interior, and a statement made for the

record by Robert A. Cook, on behalf of the New York

State Water Resources Commission in which Mr. Cook

said: “[T]he possibility still exists that extensive losses

of eggs and/or young of valuable species might occur after

installation of the proposed cag going

Just after the Commission closed its proceedings in

November the hearings held by the New York State Legis-

lative Committee on Natural Resources alerted many

fisherman groups to the threat posed by the Storm King

project. On December 24 and 30, January 8, and Febru-

ary 3 each of four groups, concerned with fishing, peti-

tioned for the right to intervene and present evidence.

They wished to show that the major spawning grounds

for the distinct race of Hudson River striped bass was

in the immediate vicinity of the Storm King project and

not “much farther upstream” as inferred by Dr. Perl-

mutter, the one expert witness called by Consolidated

Edison; to attempt to prove that, contrary to the impres-

sion given by Dr. Perlmutter, bass eggs and larvae float

in the water, at the mercy of currents; that due to the

-location of the spawning ground and the Hudson’s tidal

flow, the eggs and larvae would be directly subject to the*

influence of the plant and would be threatened with de- |

struction; that “no screening device presently feasible

would adequately protect these early stages of fish life”

and that their loss would ultimately destroy the economi-

cally valuable fisheries. Their evidence also indicated that

in the case of shad, the young migrate from their spawn-

ing grounds, down past Cornwall, and being smaller than

ate Na hed a0)

3la

the meshes of the contemplated fish screens, would be sub-

ject to the hazards already described.» The Commission

rejected all these petitions as “untimely,” and seemingly

placing great reliance on the testimony of Dr. Perlmutter,

concluded: :

“The project will not adversely affect the fish re-

sources of the Hudson River provided adequate

protective facilities are installed.”

Although an opportunity was made available at the May

hearings for petitioners to submit evidence on protective

designs, the question of the adequacy of any protective

design was inexplicably excluded by the Commission.

Recent events illustrate other deficiencies in the Com-

mittee on Fisheries and Wildlife Studying the Hudson

River Spawning Grounds, 89th Cong. 1st Sess., May 10,

11, 1965, Mr. James McBroom, representing the Depart-

ment of the Interior, stated:

“Practical screening methods are known which .

could prevent young-of-the-year striped bass and

shad from being caught up in the [Storm King]

project’s pumps, but practical means of protection

of eggs and larvae stages have yet to be devised.

Furthermore the location of the proposed plant

appears from available evidence to be at or very

25. The Committee concluded :

“The Hudson River is a spawning ground for shad and striped

bass. A multi-million dollar fishing industry, both commercial

and sport, has been built on this process of nature . . . The

Joint Legislative Committee . . . goes on record as being

unalterably opposed to the granting of Con Ed’s application,

until such time as there is definite, impartial and conclusive

proof that the project will not have an adverse effect on the

fish life and spawning process upon which the fishing industry

depends for its livelihood.” Preliminary Report 7.

32a

near the crucial spot as to potential for harm to

the overall production of eggs and larvae of the

Hudson River striped bass. The cumulative effect

of unmitigated loss of eggs and larvae of striped

bass by this power project could have a serious

effect on the Hudson River striped bass fishery and

the dependent fisheries around Long Island and

offshore.”

Mr. E. L. Cheatum, representing the New York State

Conservation Department, gave similar testimony. At the

May hearings the testimony of Mr. Walburg and Mr.

Wagner, witnesses for the Department of Interior, and

Dr. Raney and Mr. Massmann, witnesses for Scenic

Hudson, was substantially to the same effect. Indeed,

the Commission in its October 4 order acknowledged that

the protective device to which it had previously referred

favorably (March 9 order) “may not be adequate to pro-

vide the protection required” (October 4 order).

On remand, the Commission should take the whole fish-

eries question into consideration before deciding whether

the Storm King project is to be licensed.

The Commission ‘should reexamine all questions on

which we have found the record insufficient and all related

matters. The Commission’s renewed proceedings must

include as a basic concern the preservation of natural

beauty and of national historic shrines, keeping in mind

that, in our affluent society, the cost of a project is only

one of several factors to be considered. The record as it

comes to us fails markedly to make out a case for the

Storm King project on, among other matters, cost, public

convenience and necessity, and absence of reasonable

alternatives. Of course, the Commission should make

every effort to expedite the new proceedings.

IX.

G Ya

33a

Petitioners’ application, pursuant to Federal Power Act

§313(b), 16 U. S. C. $825 1 (b), to adduce additional evi-

dence concerning alternatives to-the Storm King project

and the cost and practicality of waster transmission

facilities is granted.

The licensing order of March 9.and the two orders of

May 6 are set aside, and the case remanded for further

proceedings. Ai

Appendix B—Statutes Involved

ADMINISTRATIVE PROCEDURE ACT _ +3.

Sec. 7(c) Except as statutes otherwise provide, the

proponent of a rule or order shall have the burden of

proof. Any oral or documentary evidence may be

received, but every agency shall as a matter of policy

provide for the exclusion of irrelevant, immaterial, or

unduly repetitious evidence and no sanction shall be

imposed or rule or order be issued except upon con-

sideration of the whole record or such portions thereof

as may be cited by any party and as supported by and

in accordance with the reliable, probative, and substantial

evidence. Every party shall have the right to present

his case or defense by oral or documentary evidence,

to submit rebuttal evidence, and to conduct such cross-

examination as may be required for a fyll and true

disclosure of the facts. In rule making or determining

claims for money or benefits or applications ‘for initial |

licenses any agency may, where the interest of any party

will not be prejudiced thereby, adopt procedures for the

submission of all or-part of the evidence in written form.

Sec. 7(d) The transcript of testimony and exhibits, to-

_ gether with all papers and requests filed in the proceeding,

shall constitute the exclusive record for decision in ac-

cordance with section 8 and, upon payment of lawfully

Brescribed costs, shall be made available to the parties.

Where any agency decision rests on official notice of a

material fact not appearing in the evidence in the record,

any party shall on timely request be afforded an op-

portunity to show the contrary. 2

Ssc. 10(e) So far as necessary to decision and. where

presented the: reviewing court shall decide all relevant

questions of law, interpret constitutional and statutory

provisions, and determine the meaning or applicability of |

the terms of any agency action. It shall (A) compel

agency actior unlawfully withheld or unreasonably de-

layed; and (B) hold unlawful and set aside agency action,

findings, and conclusions found to be (1) arbitrary, capri-

cious, an abuse of discretion, or otherwise not in accord-

ance with law; (2) contrary to constitutional right, power,

privilege, or immunity; (3) in excess of statutory juris-_

diction, authority, or limitations, or short of statutory

right; (4) without observance of procedure required by

law; (5) unsupported: by substantial evidence in any case

subject to dks Nociieta of sections 7 and 8 or other-

wise reviewed on the record of an agency hearing provided

by statute; or (6) unwarranted by the facts to the extent |

that the facts are subject to trial de novo by the reviewing

court. In making the foregoing determinations the court

‘shall review the whole record or such portions thereof as

may be cited by any party, and.dué&ccount shall be taken

of the rule of prejudicial error.

FeperaL Power Act

Sec. 10. All licenses issued under this Part shall be

on the following conditions :

(a) That the project adopted, including the maps, plane,

and specifications, shall be such as in the judgment of

the Commission will be best adapted to a comprehensivé

plan for improving or developing a waterway or water- :

ways for the use or benefit of interstate or foreign com-

‘merce, for the improvement and utilization of waterpower

development, and for other beneficial public uses, including

recreational purposes; and if necessary in order to secure

such plan the Commission shall have authority to require

3b ?

ee ee

the modification of any ‘project and of the plans and

specifications of the project works before approval.

Sec. 313. (a) Any person, State, municipality, or State —

commission aggrieved by an order issued by the Commis-

sion in a proceeding under this Act to which such person,

State, municipality, or State commission is a party may

apply for a rehearing within thirty days after the issuance

of such order. The application for rehedring shall set

forth specifically the ground or grounds upon which such

application is based. Upon such application the Com-

mission shall have power to grant or deny rehearing or to

abrogate or modify its order without further hearing.

Unless the Commission acts upon the application for.

rehearing within thirty days after it is filed, such applica-

tion may be deemed to have been denied. No proceeding

to review any orders of the Commission shall be brought

by any: person unless such person shall have made applica-

tion to the Commission for a rehearing thereon. Until

the record in a proceeding shall have been filed-in a court

_ of appeals, as provided in subsection (b), the Commission

may at any time, upon reasonable notice and in such man-

ner as it shall deem proper, modify or set aside, in whole

or in part, any finding or order made or issued by it

under the provisions of this act. RTE

' (b) Any party to a proceeding under this Act aggrieved

by an order issued by the Commission in such proceeding

‘may obtain a review of such order in the Circuit Court of.

Appeals .of the United States for any circuit wherein the

licensee or public utility to which the order relates is

United States Court of Appeals for the District of Colum-

bia, by filing in such court, within sixty days after the

order of the Commission upon the application for rehear-

) ing, a written petition praying that the order of the Com-

“mission be modified or set aside in whole or in part. A

copy of such petition shall forthwith be transmitted by the

clerk of the court to any member of the Commission and

thereupon the Commission shall file with the court the

record upon which the order complained of was entered,

as provided in section 2112 of title 28, United States

Code. Upon the filing of such petition such court shall

have jurisdiction, which upon the filing of the record with

it shall be exclusive, to affirm, modify, or set aside such

order in whole or in part. No objection to the order of

the. Commission shall be considered by the court unless

such objection shall have been urged before the Com-

mission in the application for rehearing unless there is

reasonable ground for failure so to do. The finding of

the Commission as to the facts, if supported by substantial

evidence, shall be conclusive. If any party shall apply to

the court for leave to adduce additional evidence, and shall

show to the satisfaction of the court that such additional

evidence is- material and that there were reasonable

grounds for failure to adduce such evidence in the pro-

ceedings before the Commission, the court may order such

additional evidence to be taken before the Commission

and to be adduced upon the hearing in such manner and

upon such terms and conditions as to the court may seem

proper. The Commission may modify its findings as to

the facts by reason of the additional evidence so taken,

and it shall file with the court such modified or new find-

ings which, if supported by substantial evidence, shall be

conclusive, and its fecommendation, if any, for the modi-

fication or setting aside of the original order. The .jndg-

ee ee

ated - “5

ment and decree of the court, affirming, modifying, or

setting aside, in whole or in part, any such order of the |

Commission, shall be final, subject to review by the

Supreme Court of the United States upon certiorari or

certification as provided in sections 239 and 240 of the

Judicial Code, as amended (U.S.C., title 28, secs. 346 and

347).* .

* Sections 239 and 240 of the — C@de (28 U.S.C. 346 and

347) were repealed and were replaced by 28 U.S.C. 1254 (62 Stat.

928,926).

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.