where the action is one which will significantly affect the quality of the human environment.
Prior to their petitions for reconsideration, the environmental issue had not been raised. The arguments of the three plaintiffs re the NEPA statement necessity have now been adopted by all the plaintiffs in this proceeding.
At the outset, it should be noted that this court's scope of review as to this issue is essentially the same limited review which governs our review of the merits of the Division's report. This court upon review of the agency's threshold determination of the necessity of a NEPA statement must examine the facts to determine whether the decision was arbitrary, capricious, or an abuse of discretion, and to decide whether the necessary procedural requirements were followed, and then determine de novo 'all relevant questions of law.' Citizens to Preserve Overton Park v. Volpe, 401 U.S. 402, 91 S. Ct. 814, 28 L. Ed. 2d 136 (1971); Hanly v. Kleindienst, 471 F.2d 823, 829 (2d Cir. 1972) cert. denied 412 U.S. 908, 93 S. Ct. 2290, 36 L. Ed. 2d 974 (1973).
In its order denying the petitions for reconsideration, the Commission expanded on the reasons for its decision that a NEPA statement was not required: (1) the SCNO grant would not increase fuel consumption or commercial activity because the traffic will still require transportation (often by the plaintiff); and (2) the denial of the application by SCNO would have an adverse environmental impact inasmuch as (a) SCNO would more likely be compelled to operate tows on the Mississippi at less than peak capacity thereby wasting fuel, and (b) during the times when the barge shortage is acute, shippers and receivers (principally on the Missouri River) would be pressed to use more polluting forms of transportation (motor trucks) to move their goods.
Two factors which an agency should normally consider in deciding whether a NEPA statement is required are: '(1) the extent to which the action will cause adverse environmental effects in excess of those created by existing uses in the area affected by (the decision), and (2) the absolute quantitative adverse environmental effects of the action itself, including the cumulative harm that results from its contribution to existing adverse conditions or uses in the affected area.' See Hanly v. Kleindienst, supra, 471 F.2d at 830-831. Applying these two considerations to these proceedings, it appears that plaintiffs are advancing a procedural proposition which lacks any objective basis. The granting of the certificate to SCNO will not enable that carrier to travel on any rivers upon which it does not now travel as an unregulated carrier. As we previously noted, the certificate here addresses of course regulated water traffic, which all parties concede constitutes no more than 4% Of the totality of tonnage moved on our inland waterways. Rather than serving new waterways, SCNO merely proposed to serve the same waterways more efficiently as a regulated as well as an unregulated carrier. It is difficult to imagine how this grant which would enable SCNO to more promptly and efficiently fill out tows, thereby conserving gasoline, could be viewed as detrimental to our environment in a time when the nation is seeking any new way in which to more efficiently consume its energy sources.
Plaintiffs argue that the Division's opinion denying the necessity for a NEPA statement was terse. It is accurate to note that the opinion was not lengthy. However, the statement was reasoned enough to allow the court to understand the process used by the Division in reaching its ultimate conclusion that an environmental impact statement was not required. Applying the appropriate standard of review, it cannot be said that this determination by the Commission was not in accordance with law or that it represents an arbitrary and capricious conclusion.
Plaintiffs refer to the case of Hanly v. Mitchell, 460 F.2d 640 (2d Cir. 1972)
to support their contention that the Division erred in not issuing an environmental impact statement. In Hanly v. Mitchell, supra, the appellate court decided that there was no error in the GSA's decision that a NEPA statement was not required for the construction of a nine-story, federal courthouse building in lower Manhattan. On the other hand, it was concluded that a NEPA statement should have been issued by the GSA for the construction of a jail-detention center in the same area of Manhattan. The court believed that the GSA had erred in failing to consider the impact of the jail on the surrounding residential environment. The matter was remanded with instructions to consider the probability that prison riots could occur which would adversely affect the immediate residential area.
If any adverse environmental impact could occur due to the SCNO grant, it would seem to be more closely related to the type of impact created by the construction of the courthouse in Hanly. The court in Hanly apparently recognized that construction of the courthouse in that area of Manhattan would have no adverse environmental effect on the immediate residential area which is already occupied by many other nine-story office buildings. Thus, by analogy, the grant of SCNO's application for more authority as a regulated carrier would not have any significantly adverse environmental impact because SCNO would be cruising the same waters it, and all unregulated carriers, have traveled. The only difference is that the load status of SCNO's tows would be changed to regulated commodities rather than unregulated, in certain instances. No increased adverse environmental impact would occur.
For the reasons as set forth, plaintiffs' NEPA contentions must be rejected. It cannot be said that the finding of the Commission was not properly made.
Was the Division's Decision Adequately Supported by a Statement of the Findings and Conclusions, and Reasons Therefor?
This contention by plaintiffs is in many ways a reiteration of some of plaintiffs' other contentions which have been discussed. Plaintiffs' argument seems to be that the Division did not support its ultimate conclusions by appropriate subsidiary findings of fact and explanations. This contention is substantially based on plaintiffs' premise that, when Division One generally adopted the Administrative Law Judge's statement of fact, the Division also undertook an additional burden of explaining how it arrived at contrary conclusions.
The Division's opinion stated:
'We find the Administrative Law Judge's statement of the facts to be substantially correct in all material respects; and, as modified herein, we adopt that statement as our own. Only those facts necessary for clarity of discussion will be restated.' 343 I.C.C. at 413.
Plaintiffs' brief refers the court to Northern Pacific Ry. v. United States, 241 F.Supp. 816 (D.Minn.1965) to support their proposition that the Division, having substantially adopted the statement of facts, was compelled to explain how it arrived at conclusions contrary to those of the Administrative Law Judge. In Northern Pacific, the District Court in Minnesota required the Commission to make a fuller explanation of its subsidiary findings, not because the I.C.C. reversed the Hearing Examiner's conclusions, but rather because the Commission had its original order on this matter annulled by another District Court in Northern California. After the Commission's original findings in Northern Pacific had been annulled by the first reviewing court, the I.C.C. did no more than reverse its prior holdings in general terms without any explanations for its reversal. It was in this context that the District Court in Minnesota ruled that the Commission's order lacked the requisite subsidiary findings.
More to the point is Caravelle Express, Inc. v. United States, 287 F.Supp. 585 (D.Neb.1968), where plaintiff made a similar argument urging that when the Commission adopted the Hearing Examiner's findings of fact, it undertook an additional burden of explaining how it arrived at a contrary conclusion. In Caravelle, the court noted that the applicable section of the APA (Administrative Procedure Act) governing the proceedings does not relegate the Commission to the role of a reviewing court, for that Act expressly confers upon the Commission the right to make its own determinations from the evidence (citing Morgan Drive-Away, Inc. v. United States, supra, 268 F.Supp. 886). Then the Caravelle opinion, after recognizing that the Commission had a duty imposed by the APA, 5 U.S.C. § 557(b) to state its findings and conclusions and to supply its reasons, concluded that there was no requirement that the Commission furnish 'an analysis of each item' brought before it, nor to disclose 'the mental processes' through which the decision was reached.
To the same effect is Braswell Motor Freight Lines, Inc. v. United States, 275 F.Supp. 98, 103 (W.D.Tex.1967) aff'd 389 U.S. 569, 88 S. Ct. 692, 19 L. Ed. 2d 779 (1968):
'Plaintiff attaches great importance to the manner in which the Commission reversed the trial examiner. In the final analysis, it is the obligation and duty of the Commission to make its decisions and in so doing it is free to accept or reject the recommendations of its examiners. Administrative Procedure Act, Section 8(a), 5 U.S.C. § 557(c); Norfolk Southern Bus Corp. v. United States, 96 F.Supp. 756, 758 (E.D.Va.1950), affirmed, 340 U.S. 802 (71 S. Ct. 68, 95 L. Ed. 590); Universal Camera Corp. v. NLRB, 1950, 340 U.S. 474, 496 (71 S. Ct. 456, 95 L. Ed. 456)'
Plaintiffs specifically point to two areas in which the Commission failed to adequately explain its reversal of the Administrative Law Judge's conclusions. First, the Administrative Law Judge in his report stated that the deficiencies in service on the Missouri were in part due to the 'weather and navigational conditions which cannot be corrected by (the) grant of authority here . . ..' (Rec.Rep., p. 9.) Second, plaintiffs aver that the Division's order failed to specifically reject and explain away the Administrative Law Judge's finding that only in a rare instance would bulk shippers be willing to have these commodities travel in a regulated status. (Rec.Rep., p. 9.)
Considering that the Commission is not required to specifically explain away each finding of the Administrative Law Judge with which it does not agree, a cursory review of the Division's report indicates that improvement of transit time on the Missouri could be achieved by SCNO on the Missouri notwithstanding the physical limitations of the Missouri. Indeed, the realization by the Commission of the Missouri's natural and physical limitations was one of the very reasons why SCNO was granted such extensive authority on the Mississippi and Gulf Intracoastal Water-ways. As previously noted, the basis for SCNO's grant was the Commission's intent to improve Missouri River barge service. Recalling that the Commission is not required to make formal or detailed findings of fact with respect to the evidence before it, so long as its report, read as a whole, discloses the essential basis of its judgment, Alabama G.S.R.Co. v. United States, 340 U.S. 216, 228, 71 S. Ct. 264, 95 L. Ed. 225 (1951), it cannot be said the Division inadequately explained the essential basis of its granting SCNO's application.
The argument that there was a failure to reject or explain away the Administrative Law Judge's finding on the frequency of exempt commodities traveling in a regulated status has no merit. The Division's report explicitly rejects this finding, stating 'contrary to the arguments of protestants, shippers of exempt bulk commodities would be willing to have their commodities move in a regulated status, and that they have done so in the past to a substantial extent.' 343 I.C.C. at 419. Because the essential basis of the Division's report is clearly explained, the Commission is not obligated to point to the specific evidence in the record that causes it to reach a conclusion contrary to the Administrative Law Judge.
As pointed out in the foregoing opinion, the findings of the Commission are supported by substantial evidence.
An appropriate order will be entered.