Constitutional Challenge to FERC

Update

uly 10, 2018:  The United States Court of Appeals upheld a district court decision rejecting Delaware Riverkeeper Network’s (DRN) due-process challenge to FERC’s funding mechanism and to FERC’s use of tolling orders. Given the makeup of the court, this decision was disappointing but not surprising. The Delaware Riverkeeper Network continues to work with our colleague organizations to find other ways to address the much needed reforms at FERC.

March 22, 2018: Oral arguments were held in the United States Court of Appeals for the DC Circuit. We are waiting for the Court’s decision as to whether there is merit to DRN’s claims of structural bias in FERC’s funding mechanism.

September 25, 2017: Delaware Riverkeeper Network appealed the dismissal of the case to the US Court of Appeals for the DC Circuit. The merits brief can be found here.

Background:

The Federal Energy Regulatory Commission (“FERC”) has become a demonstrably biased agency that has become a partner with, rather than a regulator of, the pipeline companies it purports to oversee.  In addition, FERC is misusing legal loopholes and ignoring court orders to advance gas infrastructure projects while preventing the public from exercising their rights to judicial review or fair public participation in the process.  License for FERC’s abuse of power and blatant bias is provided by the agency’s funding mechanism which makes it an agency funded 100% by the industry it regulates, and is advanced by the revolving employee door that exists between FERC and its regulated community. 

FERC is in need of reform.

There are two pathways to this reform being advanced by the Delaware Riverkeeper Network:

1) is getting an independent investigation into the agency by the Federal Energy Regulatory Commission

2) is a legal action brought by the Delaware Riverkeeper Network challenging FERC’s decisionmaking and funding as a violation of the Fifth Amendment of the U.S. Constitution.

Examples of the many problems with FERC and how it operates include, but are not limited to:

I.  The funding mechanism which results in the Federal Energy Regulatory Commission being 100% funded by the industry it regulates has resulted in blatant bias in favor of pipeline companies and against the public. For example, FERC has approved 100% of the pipeline project proposals that it has reviewed. Such an approval rate cannot be found at any other independent federal agency.

II.  The revolving door between employment with FERC and the industry it regulates contributes to agency bias in the project review and certification process, the unjustifiably high approval rate of proposed projects, and the lack of oversight and enforcement for FERC approved pipeline projects.

III. FERC abuses of law that deny the public their legal rights:

a) use of “tolling orders” to allow projects to advance while denying citizens the ability to initiate an appeal in court; 

b) granting permission for pipeline companies to begin construction activity prior to the company securing all necessary permits and approvals; 

c) continued use of segmentation and the failure to undertake cumulative impact environmental reviews in clear violation of the National Environmental Policy Act (“NEPA”), and in disregard of a July 2014 court order and opinion from the D.C. Circuit;

d) failure to comply with the requirements of NEPA, and instead using subjective judgment to pre-determine the level of environmental review for proposed projects.

IV. Allowing the taking of public and private land via eminent domain for projects that are for private benefit as opposed to a public purpose.

Litigation Updates:

On March 22, 2018, oral arguments were held in the United States Court of Appeals for the DC Circuit. We are waiting for the Court’s decision as to whether there is merit to DRN’s claims of structural bias in FERC’s funding mechanism.

On September 25, 2017, Delaware Riverkeeper Network appealed the dismissal of the case to the US Court of Appeals for the DC Circuit. The merits brief can be found here.

On March 22, 2017, the court dismissed the case. The Court found that DRN had standing to bring the action, yet DRN was unable to show that FERC’s funding mechanism was unable demonstrate structural bias. Below find a statement from the Delaware Riverkeeper addressing the results of the case.

Statement from Maya van Rossum, the Delaware Riverkeeper, leader of the Delaware Riverkeeper Network Concerning the Dismissal of the D.C. District Court Case:

It was gratifying to have set important precedent regarding standing.  The court did explicitly find that we did have standing to bring the action.  That is an important outcome in terms of precedent and future cases.            

As to how we will proceed legally in the wake of this decision is certainly under consideration.  The decision just came out and so there is a lot to consider.

My biggest concern about this decision is that it means that at this point all branches of government have now taken a pass on checking FERC’s abuses of process and law when it comes to their pipeline review and approval process.  The congress will continue to rubber stamp their budget, the president will continue to appoint bad commissioners who will perpetuate the practices of abuse, and now the courts have denied their responsibility to oversee the abuses of power and law by FERC. Now that FERC has been given a license to continue business as usual, I anticipate that FERC’s abuses will continue to get worse.  We have already seen an expansion of the level and quality of abuse they are subjecting communities to.  Their environmental reviews are getting worse, simply embracing the bad information provided by the pipeline companies and ignoring the hard data and evidence provided by the communities.  The length of the tolling orders used to prevent people from challenging pipeline projects before FERC allows them to go to construction are getting longer and I’m sure that trend will now continue.  The leap frogging over state authority will also continue as will the increasing strategies for removing meaningful opportunities for the public to be engaged in the regulatory review process.  FERC has received another green light for its abuse of the people from each of the branches of government.  And the people have lost yet again.

What this means is that the responsibility on members of the Senate to stand up strongly and passionately against the restoration of a quorum at FERC has become even more important and consequential.