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January 24, 1975

CONCERNED RESIDENTS OF BUCK HILL FALLS, By its trustee ad litem, Edwin Gee, et al., Plaintiffs,
Kenneth GRANT, as Administrator, Soil Conservation Service, U.S. Department of Agriculture, et al., Defendants

Muir, District Judge.

The opinion of the court was delivered by: MUIR


 This case involves alleged violations of the National Environmental Policy Act, 42 U.S.C.A. § 4321 et seq., and the Watershed Protection Act, 16 U.S.C. § 1001 et seq. The Plaintiffs are owners of property in the vicinity of the Buck Hill Creek in the Pocono Mountains region of northeastern Pennsylvania. The stream is a tributary of the Brodhead, one of the most famous trout streams in the Eastern United States. The Defendants, officials of the U.S. Department of Labor, propose to construct a dam across the stream in the proximity of the Plaintiffs' homes.

 On December 10, 1974, the Plaintiffs filed a complaint requesting declaratory and injunctive relief and a motion for a preliminary injunction. Expedited action was requested on the preliminary injunction as a construction contract was to be let for the dam on December 23, 1974. The award date was subsequently changed to January 3, 1975. A hearing commenced in Williamsport, Pennsylvania on December 23, 1974 and concluded on December 30, 1974. On the first day of the hearing, the parties agreed that the hearing on final injunction be consolidated with the hearing on the preliminary injunction. Because of the exigent circumstances of the case it was necessary to issue an order unaccompanied by findings of fact and conclusions of law. An order embodying a declaratory judgment and an injunction was issued by the Court on December 31, 1974 with respect to the National Environmental Protection Act issue. Findings of fact and conclusions of law are lengthy, are filed separately and incorporated herein by reference.

 1. Scope of Reviewability of the Agency's Action with Respect to the National Environmental Policy Act.

 The National Environmental Policy Act requires that federal agencies engaged in "planning and in decision making which may have an impact on man's environment . . . utilize a systematic, interdisciplinary approach . . . ." 42 U.S.C. § 4332(2)(A). The Act also requires that "a detailed statement" be prepared where "major Federal actions significantly affecting the quality of the human environment" are to be undertaken. 42 U.S.C. § 4332(2)(C). The Act specifically provides what the statement is to contain. For example, the document which has become known as an environmental impact statement must discuss the "environmental impact of the proposed action, . . . any adverse environmental effects which cannot be avoided should the proposal be implemented . . ." and, "alternatives to the proposed action." 42 U.S.C. § 4332(2)(C)(i), (ii), and (iii), respectively.

 The Court in this case is not called upon to consider the question of standing. Defendants agree that the Plaintiffs have standing to challenge the action of the Soil Conservation Service and Defendants also agree that the agency's actions are reviewable. The question presented in this case is to what extent should the Court review the determination of the Soil Conservation Service that it need not file an environmental impact statement, that it need not seek reapproval from Congress for the contested dam, and that the benefits of the dam exceed the costs. The extent to which a Court should question the actions of a federal agency is set forth by the Administrative Procedure Act, (A.P.A.), 5 U.S.C. § 706.

 The A.P.A. states that "The reviewing court shall -- (1) compel agency action unlawfully withheld or unreasonably delayed; and (2) hold unlawful and set aside agency action, findings, and conclusions found to be --

 (A) arbitrary, capricious, an abuse of discretion, or otherwise not in accordance with law;

 * * *

 (C) in excess of statutory jurisdiction, authority, or limitations, or short of statutory rights;

 (D) without observance of procedure required by law;" . . . .

 The most authoritative explanation of the Administrative Procedure Act is found in Citizens to Preserve Overton Park v. Volpe, 401 U.S. 402, 415-417, 91 S. Ct. 814, 28 L. Ed. 2d 136 (1970). The Defendants believe that agency action should only be set aside where it is found to be arbitrary and capricious. The clear import of the language of the statute and the Supreme Court case cited is that the Defendants proposed "arbitrary" and "capricious" standard is incorrect. The words "arbitrary" and "capricious" impose a minimum standard of review where there is no other standard to apply. Under Volpe, this Court is first to determine the administrator's duties, responsibilities, and whether he has carried them out. Only after that examination is made, in cases where there is no other standard to apply, should the Court then scan the agency action for evidence of arbitrary or capricious conduct. Citizens to Preserve Overton Park v. Volpe, supra. The commands of the National Environmental Policy Act are clear. The statute requires that the environmental study be done. N.E.P.A. does not direct that environmental statements are to be prepared when in the opinion of the administrator there may be a significant effect on the human environment. If an agency decides not to undertake an environmental study, it takes the risk that its decision will be overturned where a Plaintiff proves that the federal action will have a significant effect on the environment.

 The Court is aware of authority in the Second Circuit holding that an agency decision not to file an environmental impact statement should be overturned only if it is arbitrary and capricious. Hanly v. Kleindienst, 471 F.2d 823 (2d Cir. 1972), cert. denied 412 U.S. 908, 93 S. Ct. 2290, 36 L. Ed. 2d 974 (1972). We think the better view is set forth in Judge Friendly's dissent in that case and in Wyoming Outdoor Coordinating Council v. Butz, 484 F.2d 1244 (10th Cir. 1973) and Minnesota Public Interest Research Group v. Butz, 498 F.2d 1314 (8th Cir. 1974). See Save ...

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