On Appeal from the United States District Court for the Middle District of Pennsylvania
(D.C. Civil Action No. 94-cv-01033) Argued February 9, 1996
Before: BECKER, ROTH and MCKEE, Circuit Judges
(Opinion Filed August 20, 1996)
In this appeal, we must evaluate the Secretary of Labor's interpretation of the Low-Level Radioactive Waste Policy Amendments Act of 1985 ("LLRW Act"), 42 U.S.C. Section(s) 2021a-2021j, under the standard set forth in Chevron U.S.A., Inc. v. Natural Resources Defense Council, Inc., 467 U.S. 837 (1984). We hold that the Secretary's interpretation was a permissible reading of an ambiguous statute and is properly accorded deference. We will therefore reverse the district court's decision and enter judgment for the Secretary.
This case revolves around Congress's efforts to address the nation's problems with the disposal of low-level radioactive waste ("LLRW") and the Secretary of Energy's ("Secretary") attempts to implement Congress's legislated solution. Much of the background to this dispute is described in New York v. United States, 505 U.S. 144 (1992), in which the U.S. Supreme Court held unconstitutional the LLRW Act's requirement that states which were not in compliance with the Act after January 1, 1993, take title to their waste. 42 U.S.C. 2021e(d)(2)(C)(i). The Court held the take-title provision severable; the balance of the Act remains in effect.
The LLRW saga began in the 1970s when six commercial LLRW disposal sites were operating in the United States. By 1979, three of the facilities had closed permanently, and the states where the three remaining facilities were located had announced plans to shut down or to severely limit access to their sites. The nation faced a substantial risk that thousands of LLRW generators -- such as hospitals, research institutions, universities, manufacturers, industrial facilities, and nuclear power plants -- would have nowhere to dispose of their waste. New York, 505 U.S. at 149-50.
Congress responded to this crisis by passing the Low-Level Radioactive Waste Policy Act of 1980, Pub. L. No. 96-573, 94 Stat. 3347 (1980). This largely hortatory enactment authorized states to form regional compacts that would cooperate to plan, construct, and operate new LLRW disposal sites. The 1980 Act authorized the regional compacts to exclude waste generated outside their regions beginning on January 1, 1986. As that date approached, it became apparent that no new facilities had been built. The nation faced a renewed LLRW crisis, accentuated by the fact that those regional compacts containing the three existing facilities could now exclude waste from the remaining states. New York, 505 U.S. at 151.
Congress reacted by passing new legislation. The Low-Level Radioactive Waste Policy Amendments Act of 1985, 42 U.S.C. Section(s) 2021a-2021j, created a revised set of deadlines and added a variety of incentives and penalties to the formerly toothless scheme. The goal of the program remained the construction of new disposal sites. The new system of incentives and penalties was designed to spur construction. The deadlines included a series of milestones by which states had to submit plans, issue progress reports, and eventually complete licensing applications for new LLRW sites. States could also comply with the statute's requirements by forming regional compacts in which one state would build the requisite facility and the others would contract for waste disposal. The incentives included an escalating scale of surcharges, which states with sites could charge for LLRW waste disposal and a rebate system to return a portion of those surcharges to states that met the relevant milestones. States that failed to meet the milestones would forfeit these rebates, would face higher surcharge rates, and could be barred from disposing of their waste at a given facility.
The various statutory milestones followed a natural progression toward full disposal. By July 1, 1986, "each non-member State" had to manifest an "intent to develop a site for the location of a [LLRW] disposal facility within such State." 42 U.S.C. 2021e(e)(1)(A). By January 1, 1988, each non-sited region had to identify the state that would contain the LLRW facility and develop a detailed siting plan for establishing the facility. Id. 2021e(e)(1)(B). By January 1, 1990, each non-sited compact region and each non-member state had to furnish a complete application for licensing the LLRW facility. Alternatively, any state without a facility could provide "written certification . . . that such State will be capable of providing for, and will provide for, the storage, disposal, or management of any [LLRW] waste generated within such State and requiring disposal after December 31, 1992 . . .." Id. 2021e(e)(1)(C). The fourth and final milestone provided for reimbursement only if "by January 1, 1993, the State . . . is able to provide for the disposal of all [LLRW] generated within such State or compact region." Id. Section(s) 2021e(d)(2)(B)(iv).
To comply with the LLRW Act, the states of Pennsylvania, Delaware, Maryland, and West Virginia formed the Appalachian States Low-Level Radioactive Waste Compact, governed by the plaintiff-appellee Appalachian States Low-Level Radioactive Waste Commission ("Commission"). Congress approved this compact on May 19, 1988. Pub. L. No. 100-319, 102 Stat. 471 (1988). The record indicates that the Commission met the first three statutory milestones.
This dispute turns on the fourth milestone. On December 1, 1992, the Commission entered an eighteen-month conditional contract with the Southeast Compact to obtain access to the disposal facility in Barnwell, South Carolina, one of the three sites that had been in existence when the original 1980 Act was passed. *fn1 The contract was not renewed, and the Commission does not have a contract with any other compact region or state for the disposal of LLRW. Nevertheless, this contract was in effect on January 1, 1993, the date by which a state had to be able to dispose of "all" LLRW to meet the fourth milestone and qualify for a rebate.
On February 11, 1993, the Commission sent a letter to the Department of Energy claiming that it had satisfied the requirements of the LLRW Act and was therefore eligible for a full 1993 rebate. On March 21, 1994, the Secretary published her interpretation of the statute, clarifying the criteria for the 1993 rebate. She explained that a full 1993 rebate would be given only to those states that had provided for disposal of all their waste for the entire three-year period from January 1, 1993, until January 1, 1996. States that only provided for disposal for shorter periods would have their rebates reduced proportionately. This interpretation was based on the Secretary's reading of the statute as a whole, relying particularly on the related provision in Section(s) 2021e(d)(2)(C) that established the consequences of failing to meet the 1993 milestone. On April 22, 1994, the Commission renewed its request for a full 1993 rebate. On September 1, 1994, pursuant to its final policy and procedures, the Secretary paid the Commission one half of the maximum rebate, plus interest. This amount was based on the Commission's eighteen-month contract, which provided for waste disposal for half of the three-year period.
The Commission responded by filing suit in the U.S. District Court for the Middle District of Pennsylvania, seeking a writ of mandamus to compel the Secretary to pay the full rebate. Both sides moved for summary judgment. Ostensibly applying Chevron, U.S.A., Inc. v. Natural Resources Defense Council, Inc., 467 U.S. 837 (1984), the district court held that (1) the statute was ambiguous, but that (2) the Secretary had failed to adopt a reasonable reading of the LLRW Act. See Appalachian States Low-Level Radioactive Waste Comm'n v. ...