Does the Natural Gas Act preempt EHB jurisdiction over appeals from DEP’s decisions concerning permits required under Federal law?
Cole v. DEP, 257 A.3d 805 (Pa. Cmwlth. 2021) (en banc), appeal dockets 21 EAP 2023 and 77 MAP 2023; West Rockhill Twp. v. DEP, 258 A.3d 1161 (Pa. Cmwlth. 2021) (en banc) (unreported), appeal dockets 22 EAP 2023 and 78 MAP 2023, allocatur granted August 3, 2023
Before constructing its natural gas pipeline compressor station in Quakertown Pennsylvania, Adelphia Gateway, LLC, an interstate pipeline, needs various regulatory approvals, including a certificate of public convenience and necessity from the Federal Energy Regulatory Commission (FERC) under Section 7(c) of the Natural Gas Act, 15 U.S.C. § 717f(c), and a plan approval from the Pennsylvania Department of Environmental Protection (DEP) under the federal Clean Air Act and the Pennsylvania Air Pollution Control Act. After DEP issued the plan approval, neighboring protesters filed a timely appeal with the Environmental Hearing Board (EHB). The EHB then granted Adelphia’s motion to dismiss the protesters’ appeal, agreeing with Adelphia that any challenge to DEP’s action lies within the original and exclusive jurisdiction of the United States Court of Appeals for the Third Circuit under Section 19 of the federal Natural Gas Act, 15 U.S.C.A. § 717r(d)(1) (Section717r(d)(1)), which provides:
The United States Court of Appeals for the circuit in which a facility … is proposed to be constructed, expanded, or operated shall have original and exclusive jurisdiction over any civil action for the review of an order or action of a Federal agency … or State administrative agency acting pursuant to Federal law to issue, condition, or deny any permit, license, concurrence, or approval (hereinafter collectively referred to as “permit”) required under Federal law, other than the Coastal Zone Management Act of 1972.
On appeal, the en banc Commonwealth Court reversed, holding that the EHB erred in dismissing the protesters’ appeal, and remanding to the EHB for further proceedings on the protesters’ appeal. The court reasoned that while Section717r(d)(1) vests the Third Circuit with original and exclusive jurisdiction over any civil action for the review of an order of a state administrative agency acting pursuant to federal law to issue a permit required under federal law, the protesters’ appeal from DEP to the EHB was not a civil action as defined under either federal or Pennsylvania law. Rather, under both federal law and Pennsylvania law the term “civil action” refers only to civil cases brought in courts of law or equity. Therefore, although DEP’s action in approving Adelphia’s plan was final agency action that could have been appealed directly to the Third Circuit, the protesters also had the option under Pennsylvania law to pursue an administrative appeal before a different Pennsylvania agency – the EHB. In so deciding, the Commonwealth Court expressly recognized that Section 717r(d)(1) precludes state court review of DEP permitting decisions that fall under the scope of Section 717r(d)(1), because such review would clearly constitute a “civil action,” but held that protesters, if they desired, could pursue an administrative appeal to the EHB because it was permitted under Pennsylvania law and not a state civil action that is prempted under Section 717r(d)(1):
Section 717r(d)(1) vests within the federal circuit courts of appeals exclusive jurisdiction over civil actions challenging certain state permitting decisions that fall within the scope of the statute. The term “civil actions” in the federal statute does not include state administrative agency reviews of state permitting decisions. Such collateral administrative reviews remain available, if desired, and are not preempted by the federal jurisdictional statute. For these reasons, expounded upon above, the EHB erred when it dismissed Petitioners’ timely administrative appeal of the April 19, 2019 DEP plan approval of the Quakertown Compressor Station for lack of jurisdiction. We, therefore, will reverse the EHB’s order and remand the matter to the EHB to hear Petitioners’ administrative appeal.
Slip op. at 25.
Both DEP and Adelphia sought allowance of appeal, which the Supreme Court granted. The issues, as stated by DEP, are:
(1) Did the Commonwealth Court err in deciding that the Pennsylvania Environmental Hearing Board has jurisdiction to hear appeals of DEP actions on projects regulated by the Federal Energy Regulatory Commission under the Natural Gas Act when the Natural Gas Act grants the Third Circuit original and exclusive jurisdiction to review state agency actions related to interstate domestic energy projects?
(2) Did the Commonwealth Court contradict other appellate courts in deciding that both the EHB and the Third Circuit have jurisdiction to hear an appeal of DEP’s action?
The issues, as stated by Adelphia, are:
(1) The U.S. Court of Appeals for the Third Circuit has ruled five times that it has “original and exclusive” jurisdiction over the review of the Department’s issuance of permits in connection with interstate natural gas pipeline projects regulated under the federal Natural Gas Act. Did the Commonwealth Court err on an important question of first impression in holding that the EHB has dual jurisdiction over such appeals, contrary to the plain language of the Natural Gas Act?
(2) Did the Commonwealth Court depart from accepted judicial practices and abuse its discretion in determining that the federal Natural Gas Act does not preempt the EHB from reviewing the Department’s permits, given the contrary holdings of other courts, and given that those permits are issued pursuant to, and required by, federal law governing interstate natural gas pipeline projects?
(3) Did the Commonwealth Court depart from accepted judicial practices and abuse its discretion in adopting a dual-jurisdiction approach that is contrary to the plain language of the federal Natural Gas Act ‘s judicial review provision, undermines Congress’s clear legislative purpose, is without precedent in this or any other jurisdiction, and creates an unworkable framework that will produce uncertainty, inconsistency, and conflict among state and federal courts?
For more information, contact Kevin McKeon or Dennis Whitaker.