14

BACKGROUND FACTUAL STATEMENT OF EVENTS LEADING UP TO THE CALVERT CLIFFS DECISION AS EXCERPTED FROM THE RESPONDENTS BRIEF IN CALVERT CLIFFS' COORDINATING COMMITTEE, INC., ET AL.

v.

UNITED STATES ATOMIC ENERGY COMMISSION, ET AL., UNITED STATES COURT OF APPEALS FOR THE DISTRICT OF COLUMBIA CIRCUIT, No. 24, 871

This action seeks review of regulations promulgated by the Atomic Energy Commission stating the agency's general policy and procedure for implementation of the National Environmental Policy Act of 1969 (P.L. 91-190, 83 Stat. 852) in licensing proceedings conducted by the AEC. Petitioners, three conservationist organizations, dispute compliance with the National Environmental Policy Act of certain provisions of the subject AEC regulations. The relevant facts and the rule making proceedings of the Atomic Energy Commission may be summarized as follows:

On January 1, 1970, the National Environmental Policy Act of 1969 (NEPA) became effective. The Act declares that:

it is the continuing policy of the Federal Government, in cooperation with State and local governments, and other concerned public and private organizations, to use all practicable means and measures, including financial and technical assistance, in a manner calculated to foster and promote the general welfare, to create and maintain conditions under which man and nature can exist in productive harmony, and fulfill the social, economic, and other requirements of present and future generations of Americans. (Section 101(a)). Section 101 (b) of the Act provides that, in order to carry out the policy set forth in the statute, "it is the continuing responsibility of the Federal Government to use all practicable means, consistent with other essential considerations of national policy, to improve and coordinate Federal plans, functions, programs, and resources" to the end of attaining certain broad goals in the management of the environment.

NEPA authorizes and directs in Section 102 that, "to the fullest extent possible", the policies, regulations and public laws of the United States shall be interpreted and administered in accordance with the policies set forth in the Act. Section 102 (1). This section also requires, among other things, that all agencies of the Federal Government are to include in every recommendation or report on proposals for legislation and "other major Federal actions significantly affecting the quality of the human environment", a detailed statement by the responsible official on certain specified environmental considerations. Prior to making this detailed statement, the responsible Federal official is to consult with and obtain the comments of "any Federal agency which has jurisdiction by law or special expertise with respect to any environmental impact involved"; and provision is further made

for obtaining the comments and views of "the appropriate Federal, State, and local agencies, which are authorized to develop and enforce environmental standards". The detailed statement and the comments and views obtained in connection therewith are to be made available to the President, the Council on Environmental Quality (a body within the Executive Office of the President given statutory status and specified oversight functions by Title II of NEPA) and to the public and are to accompany the proposal through the existing agency review processes. Section 102 (2) (C).

On March 31, 1971, the Commission issued its initial policy statement for implementing the new environmental legislation in the area of AEC licensing activities. The policy statement, effective upon publication,1 reflected a Commission determination that the issuance of construction permits and operating licenses for nuclear power reactors and fuel reprocessing plants were "major Federal actions significantly affecting the quality of the human environment", and embodied, inter alia, the following: a requirement and procedure for the preparation of detailed environmental statements in connection with the licensing of these facilities; and a requirement that such environmental statements and companion comments from cognizant Federal, State and local agencies accompany license applications through the agency review process. The policy statement also contained a delaration by the Commission in regard to the enlargement of its licensing jurisdiction as a consequence of NEPA's enactment.2

Two months later, the Commission published for comment in the Federal Register proposed amendments to its NEPA implementation regulations (35 F.R. 8594, June 3, 1970). The purpose of the proposed amendments was to revise the Commission's regulations to take account of (1) implementation guidelines which had since been issued by the Council on Environmental Quality in regard to the preparation and distribution of environmental statements and (2) enactment of the Water Quality Improvement Act of 1970. The Commission's rule making notice stated the agency's expectation that the proposed amendments, to the extent not inconsistent with the existing regulations, would be useful as interim guidance until final rule making action was taken; and comments on the proposed revisions were invited from "all interested persons". (35 F.R. 8595).

By letter dated June 29, 1970, petitioners in this action filed with the Commission a petition for rule making seeking amendment to the Commission's regulations in respect to NEPA implementation. Petitioners requested that the Commission add new provisions to its NEPA regulations to apply the latter Act to nuclear power plants for which construction permits had been issued without prior consideration by the AEC of NEPA factors. In this connection, petitioners proposed the regulations provide that, at the instance of any interested party, the Commission shall immediately issue to any such construction permit holder an order to show cause why the permit should not be suspended pending the full investigation of the environmental impact of the subject facility; and further asked for a regulatory provision directing suspension of a permit where the Commission finds that full and complete examination of environmental impact has not been conducted in accordance with NEPA. The Commission was additionally requested: to require submission, as soon as possible, of NEPA environmental reports from permit holders of pre-ÑEPA facilities; to conduct NEPA environmental studies and prepare NEPA environmental statements with respect to such facilities; and to require facility modification or permit revocation in the light of the above studies so as to protect the environment to the greatest extent practicable. Petitioners further proposed that the Commission amend its regulations to require "backfitting" of any nuclear facility previously licensed for construction (i.e., the addition, elimination or modification of facility structures, systems or components) if the Commission finds that such action will provide substantial additional protection of the environment.

Finally, petitioners asked that their rule making request be considered as comments in the rule making proceeding previously initiated by the Commission.

On August 6, 1970, the Commission published in the Federal Register a notice of "Filing and Denial of Petition for Rule Making in Light of Pending Rule Making Proceeding" (35 F. R. 12566). The Commission's notice stated that the proposals and comments made in petitioners' rule making request were germane to the subject of the AEC rule making proceeding then under way; that the agency deemed it unnecessary to initiate a further separate rule making proceeding; and that the Commission, in the pending rule making proceeding, would consider carefully and address itself to the matters raised by the petitioners' rule making request.

The June 3 rule making proceeding elicited comments "reflecting a variety of, and sometimes conflicting, points of view" from Federal and State agencies, from conservation groups, from industry organizations, and from members of the general public. Following "consideration of these comments and other factors involved", the Commission issued its revised NEPA regulations on December 3, 1970. To summarize its principal provisions, that issuance: continued the requirement for AEC preparation of a detailed environmental statement for license applications after appropriate intra and inter-governmental consultation and coordination; enlarged the scope of the non-radiological environmental issues which might be raised by the AEC staff or any other party in Commission construction permit and operating

35 F.R. 18469, December 4, 1970: "Implementation of the National Environmental Policy Act of 1969; Revision of Appendix D of Part 50”.

7

license proceedings; and imposed new environmental requirements on holders of construction permits and operating licenses already issued by the Commission.

The Commission's issuance of December 3, 1970, dealt specifically with the comments submitted by petitioners. The Commission noted, in this regard, that it had modified its NEPA regulations to require, "as soon as practicable", the filing of environmental reports by construction permit holders who had not previously prepared such reports (including pre-NEPA permittees), and to provide for the subsequent preparation by the AEC of NEPA detailed environmental statements. Further, the new regulations provided that the license condition compelling observance of applicable Federal and State environmental protection standards and requirements, hitherto prospective in its imposition, would be included in all permits and licenses previously issued which did not contain such a condition.

Petitioners' suggestion that agency proceedings be initiated looking to suspension of pre-NEPA construction permits pending a NEPĂ study of the environmental impact of the facilities involved, was not adopted by the Commission. The Commission stated that whether suspension is appropriate is a matter to be determined pursuant to Subpart B of its Rules of Practice in the light of the requirements established by the new NEPA regulations.

With respect to petitioners' request for "backfitting" of facilities, the Commission stated that, in its program for the regulation of facilities, the primary times for decision making are at the construction permit and operating license stages; that the approach embodied in its new NEPA regulations affords the full review of environmental matters in connection with agency decision making required by NEPA; and that this review process, together with the NEPA condition which would be imposed on all prior holders of construction permits and operating licenses, "reflects a reasonable balancing of the various public interest considerations involved".

The Commission went on to state that, in regard to application of NEPA to matters of water quality (a further point raised by petitioners in their supporting memorandum), the agency remained of the view that the requirements of Section 21(b) of the Federal Water Pollution Control Act supersede, where they apply, NEPA's more general environmental requirements. It noted, in this connection, that the new NEPA regulations do call for discussion of water quality aspects of the proposed licensing action in an applicant's environmental report and in the AEC's detailed environmental statement and that provision is made for the inclusion in construction permits and operating licenses of conditions requiring compliance with the applicable requirements of Section 21 (b).

The Commission stated that, in its rule making consideration of a NEPA policy for AEC licensing proceedings, it had recognized "the public interest in protecting the environment as well as the public

'These expanded issues were made applicable by the new regulations "only to proceedings in which the notice of hearing in the proceeding is published on or after March 4, 1971".

The rule making notice stated that this was done: "In order to provide an orderly period of transition in the conduct of the Commission's regulatory proceedings and to avoid unreasonable delays in the construction and operation of nuclear power plants urgently needed to meet the national requirements for electric power”.

10 CFR Part 2, Subpart B, "Procedure for Imposing Requirements by Order or for Modification, Suspension, or Revocation of a License".

interest in avoiding unreasonable delay in meeting the growing national need for electric power". It took note of progressively increasing demands for electricity and, particularly, of authoritative forecasts which indicated that "during the coming winter and summer and for the next few years, there is a real electric power and fuel crisis in this country". The Commission set forth its belief that the agency's new NEPA regulations take appropriate account of the foregoing and reflect "a balanced approach toward carrying out the Commission's environmental protection responsibilities under the National Environmental Policy Act of 1969 and the Atomic Energy Act of 1954, as amended".

On December 7, 1970, petitioners filed their petition for review of this Commission rule making action with the Court. In a separate petition for review, filed with the Court on November 25, 1970 (No. 24,839), petitioners contest the Commission's refusal to take certain of the actions which they requested in regard to the Calvert Cliffs Nuclear Power Plant. By order of the Court, the two proceedings have been consolidated for purposes of argument.