Aviation and Airport Development Law

FAA Reopens Comment Period on Massive Changes to the Part 16 Adjudication Process

Barbara E. Lichman, Ph.D., J.D. — Thu, 17 May 2012 12:20:07 -0800

On May 17, 2012, FAA published in the Federal Register a “Notice of Proposed Rulemaking (NPRM); Reopening of Comment Period” for “Rules of Practice for Federally Assisted Airport Enforcement Proceedings (Retrospective Regulatory Review)” first published in March, 2012. In plain language, FAA is making substantial changes to the procedures for bringing a challenge to airports’ compliance with FAA grant assurances under 14 C.F.R. Part 16. “Grant assurances” are those commitments made by airport sponsors in return for receipt of federal funding of airport projects, as required by 49 U.S.C. § 47107. Any changes in the procedures for enforcing grant assurances are of significant interest not only to the airports, which may benefit from a relaxation in the procedures for challenging their actions, but also to airport users, such as fixed-base operators (“FBO”), airlines, and other airport related businesses. The proposed changes are broad in scope and purportedly made for the purpose of, among other things, becoming consistent with the Federal Rules of Civil Procedure.

The changes include, but are not limited to: (1) changes to 14 C.F.R. Part 16.26 to allow motions for summary judgment or dismissal to be filed by the airport before the date for its formal answer to the Part 16 complaint in order to eliminate duplication of effort in answering the complaint and challenging its legal adequacy at the same time; (2) termination of complainant’s standing to appeal pursuant to 14 C.F.R. Part 16.109, where FAA has already found the airport noncompliant thus achieving the complainant’s initial objective; (3) clarification of the requirement in Part 16.207 for a written motion to intervene by a party in any proceeding, and broadening of the current standard for intervention, which now requires a property or financial interest “that may not be adequately addressed by the parties,” with a less restrictive standard, i.e., “if the person has an interest that will benefit the proceedings;” (4) addition of new sections 16.33(e) and (f) and 16.245(e) and (f) to limit the grounds for appeal to issues that were before the court in the underlying action; and (5) addition of a new requirement in proposed section 215(e) that would allow deposition of FAA employees only “with the specific written permission of the Chief Counsel.”

Of the major proposed changes, the last appears most questionable from a due process perspective. As parties are entitled to obtain a broad range of information from FAA, including technical information, through the Freedom of Information Act, there does not appear to be any reason for the change, other than FAA’s alleged concern that, by deposing agency officials, parties are obtaining technical information they might otherwise have to obtain through expert witnesses. As FAA officials are often the closest observers and most knowledgeable parties about the controlling regulation and grant assurances, as well as observance of them or lack thereof at a particular airport, it seems contrary to normal judicial procedure, as well as government’s obligations under the Constitution to provide a fair hearing, to require approval of FAA employees’ testimony by the FAA, the adjudicating agency.

The comment period which officially ended May 4, 2012, is now extended to June 7, 2012.

Federal Aviation Administration Aims at Simplifying Its Airport Design Standards

Barbara E. Lichman, Ph.D., J.D. — Mon, 07 May 2012 09:15:49 -0800

On Monday, May 7, 2012, the Federal Aviation Administration (“FAA”) issued a revision to Advisory Circular 150/5300-13A which provides standards and recommendations for airport design. While Advisory Circulars are typically considered non-regulatory, and, thus, merely “advisory,” use of the Advisory Circulars is mandatory on all projects funded by the FAA under the Federal Airport Improvement Program.

The principal changes include: (1) a new introduction of the Runway Reference Code and Runway Design Code; (2) an expanded discussion on “declared distances;” (3) a clarified discussion on the Runway Protection Zone; (4) the introduction of a Taxiway Design Group concept; (5) the establishment of more specific guidelines for the separation between non-intersecting runways and intersecting runways; (6) the inclusion of runway incursion prevention geometry for taxiway to taxiway intersections and taxiway to runway interface; and (7) the consolidation of numerous design tables into one Runway Design Standards Matrix, Table 3-5.

Comments must be received on or before July 6, 2012 by either hand delivery to Federal Aviation Administration, 800 Independence Avenue S.W., AAS-100, Room 621, Washington, DC 20590, or by fax to (202)267-3688.

EPA's Proposed Carbon Pollution Standard for New Power Plants Creates Controversy

Barbara E. Lichman, Ph.D., J.D. — Mon, 30 Apr 2012 10:57:34 -0800

On March 27, 2012, the Environmental Protection Agency (“EPA”) proposed a Carbon Pollution Standard for New Power Plants (“Carbon Standard”), setting national limits on the amount of carbon pollution power plants built in the future can emit. The rules are a reaction to the United States Supreme Court’s decision in Massachusetts v. EPA, 549 U.S. 497 (2007), in which, among other things, the Supreme Court held that greenhouse gases, including carbon dioxide (“CO2”) are air pollutants under the Clean Air Act. EPA was charged by the court with issuing an “endangerment finding,” i.e., a determination that greenhouse gases threaten public health and welfare which was issued on December 15, 2009.

Immediately upon their initial promulgation, the Carbon Standard generated more contention than power plants generate greenhouse gases. The Wall Street Journal charged, in an article entitled “Killing Coal,” that “because the putative ‘regulatory impact’ would be zero, there are also no benefits.” It went on to say that, because the rule would apply not only to new plants but also to every plant upgrade or modification in existing facilities; and because the technology required to meet the standard is still speculative, the EPA’s real goal must be to put a stop to the use of coal in electricity generating.

The EPA immediately fired back, characterizing the critique of the Carbon Standard in, among others, the Wall Street Journal, as examples of “fact free assault.” Assistant Administrator Gina McCarthy pointed to the “example” that, in fact, “this standard only applies to new sources – that is power plants that will be constructed in the future. This standard would never apply to existing power plants.” Moreover, again pointing to the Wall Street Journal editorial, she stated “the proposed rule explicitly does not apply to facilities making such modifications. In fact, EPA did not propose a standard for any modifications.”

The proposed Carbon Standard speaks for itself.

The Carbon Standard proposes that new fossil fuel fired power plants meet an output based standard of 1,000 pounds of CO2 per megawatt hour (pound CO2/MWh gross). It would apply only to new fossil fuel fired electric utility generating units (“EGUs”). For purposes of the Carbon Standard, fossil fuel fired EGUs include fossil-fuel-fired boilers, integrated gasification combined cycle (“IGCC”) units, and stationary combined cycle turban units that generate electricity for sale and are larger than 25 megawatts. EPA takes the position that new natural gas combined cycle (“NGCC”) power plant units should be able to meet the proposed standard without add-on controls. In fact, basing its claim on available data, EPA believes that nearly all (95%) of the NGCC units built since 2005 would meet the standard. Finally, new power plants that are designed to use coal or petroleum coke would be able to incorporate technology to reduce carbon dioxide emissions to meet the standard, such as carbon capture and storage (“CCS”).

What the Carbon Standard does not do is, perhaps, more notable, than what it does do. EPA explains that the proposal would not apply to: (1) existing units including modifications such as changes needed to meet other air pollution standards; (2) new power plants that have permits and start construction within 12 months of the proposed rule, or units looking to renew permits that are part of a Department of Energy demonstration project (provided that these units start construction within 12 months of the proposal); (3) new units located in non-continental areas such as Hawaii and United States territories; and (4) new units that do not burn fossil fuels (e.g., that burn biomass only).

Finally, EPA takes the position that the Carbon Standards provide flexibilities for new power plants to phase in technology to reduce carbon pollution. For example, new power plants that use CCS would have the option to use a thirty year average of CO2 emissions to meet the proposed standard, rather than meeting the annual standard each year. Moreover, plants that install and operate CCS right away would have the flexibility to emit more CO2 in the early years as they learn how to best optimize the controls. In the final analysis, EPA’s, DOE’s and other industry projections indicate that the Carbon Standard is in line with current industry investment patterns. That is, due to the economics of coal and natural gas, among other factors, new power plants that are built in over the next decade or more would be expected to meet this proposed standard even in the absence of the rule.

EPA will accept comments for 60 days after publication in the Federal Register. Comments on the proposed standard should be identified by Docket ID No. EPA-HQ-OAR-2011-0660.

The FAA Proposes Changes to its Funding Contracts with Airports

Barbara E. Lichman, Ph.D., J.D. — Mon, 23 Apr 2012 09:30:16 -0800

On April 13, 2012, as a result of the February 14, 2012 passage of the Federal Aviation Administration Modernization and Reform Act of 2012 (“FMRA”), the Federal Aviation Administration (“FAA”) proposed modifications to the “grant assurances” incorporated into FAA’s contracts with airports that receive FAA funding for physical improvements and/or noise compatibility purposes. These changes were made in order to ensure the consistency of the grant contracts with the changes arising out of FMRA. The revisions primarily address three categories of actions: (1) permission for “through the fence” operations under specified conditions; (2) exceptions to current restrictions on use of airport revenues; and (3) revision to rules governing use of revenues gained from disposal of airport property subsidized by FAA.

(1) Grant Assurance 5, “through the fence” arrangements, whereby proximate, off-airport, aviation-related development, either residential or commercial, is now allowed access to airport property through the airport’s security fence under specified circumstances. FMRA has restored the opportunity for “through the fence” arrangements which, after 9/11, were prohibited due to security concerns. Consequently, Grant Assurance 5, subsection g, was revised to provide the terms under which “through the fence” arrangements may operate.

(2) Grant Assurance 15, “Veteran’s Preference,” which previously included only “Vietnam era veterans,” now includes “Persian Gulf veterans, Afghanistan-Iraq war veterans, disabled veterans” and business owned and operated by disabled veterans from those conflicts;

(3) Grant Assurance 25, governing use of airport revenues, to add two new exceptions to the general rule that “[a]ll revenues generated by the airport and any local taxes on aviation fuel established after December 30, 1987, will be expended by it for the capital or operating costs of the airport; the local airport system; or other local facilities which are owned or operated by the owner or operator of the airport and which are directly and substantially related to the actual air transportation of passengers or property; or for noise mitigation purposes on or off the airport.” Grant Assurance 25.a. The first exception, set forth in new section a.(2) deals with the FAA’s financing of the sale of a “privately owned airport to a public sponsor.” It provides that the limitation set forth above on the uses of revenue will not apply under certain specified conditions applicable to the prior owner of the private airport. Those conditions require, among other things, that, in the event of a sale to a public airport, the prior owner will repay FAA “an amount equal to the unamortized portion of any airport improvement grant made to the private owner for use other than land acquisition after October, 1996 plus an amount equal to the Federal share of the current market value of any airport land acquired with an airport improvement grant,” made after October 1, 1996. A second revision also exempts revenues derived from mineral extraction, production or lease at a general aviation airport;

(4) Grant Assurance 29, also dealing with the new rules governing “through the fence” access, requiring amendment to airport layout plans (“ALP”) to include “all proposed and existing access points used to taxi aircraft across the airport’s property boundary;” and

(5) Grant Assurance 31, governing use of proceeds from disposal of real property. Previously, proceeds from the disposal of airport real property which equal the “portion of the proceeds of such disposition which is proportionate to the United States’ share of the cost of acquisition of such land” were limited, with the permission of the Secretary, to reinvestment in another eligible airport improvement project at the airport or within the national airport system, or repayment into the aviation trust fund. The amendment now prescribes certain criteria by which the Secretary shall make the determination on the use of funds, including, in descending order: (1) reinvestment in an approved noise compatibility project; (2) reinvestment in an approved project that is eligible for grant funding under 49 U.S.C. § 47117(e); (3) reinvestment in an approved airport development project that is eligible for grant funding under 49 U.S.C. §§ 47114, 47115 or 47117; (4) transfer to an eligible sponsor of another public airport to be reinvested in an approved noise compatibility project at that airport; and (5) paid to the Secretary for deposit in the Airport and Airway Trust Fund. 77 Fed.Reg. 22376, 22378 (the criteria prescribed for allocation of proceeds from the sale of land for noise compatibility purposes under Grant Assurance 31, subsection a, are substantially similar).

Comments on the proposed revisions are due no later than May 14, 2012.

EPA Takes Its First Enforcement Action Under Marine Diesel Engine Air Rules

Barbara E. Lichman, Ph.D., J.D. — Thu, 29 Mar 2012 08:52:34 -0800

On March 28, 2012, the Environmental Protection Agency (“EPA”) and Department of Justice (“DOJ”) announced their first settlement of an enforcement action addressing Federal Clean Air Act (“CAA”) violations in the marine engine manufacturing and ship building industries. Under that settlement, Coltec Industries, Inc. (“Coltec”) and National Steel and Shipbuilding Company (“National Steel”) have agreed to pay a civil penalty of $280,000 and spend approximately $500,000 on an environmental project to resolve alleged violations of the CAA and the EPA’s marine diesel engine air rules. Coltec is a subsidiary of EnPro Industries, Inc. and operates Fairbank Morse Engines which supplies marine propulsion and ship service systems to the United States Navy and Coast Guard. National Steel is a subsidiary of General Dynamics which designs and builds support ships, oil tankers and dry cargo carriers for the United States Navy and commercial markets.

The CAA prohibits marine diesel engines from being sold in the U.S. unless the engines are covered by a certificate of conformity and have an EPA label indicating that the engine meets applicable emissions standards. Engines that are not certified may be operating without proper emissions controls and emitting excess carbon monoxide and nitrogen oxides. On September 30, 2010, the DOJ filed a complaint which alleged that Coltec violated the CAA by manufacturing and selling 32 marine diesel engines that were not covered by an EPA-issued Certificate of Conformity and that National Steel violated the CAA by installing those engines in ships that National Steel built and sold to the U.S. Navy. The complaint also alleged that the 32 uncertified Coltec engines, plus eight more certified engines Coltec sold to National Steel, had missing or improper emissions compliance labels required by EPA’s regulations. Finally, the complaint alleged that National Steel further violated the CAA by manufacturing and selling ships containing an additional six uncertified engines.

The settlement includes a supplemental environmental project in which Coltec and National Steel will install a NOx control system to an engine test stand exhaust stack connected to Coltec’s Beloit, Wisconsin engine manufacturing facility. The engine test stand is used for testing large marine diesel engines. The NOx controls required by the settlement are estimated to reduce levels of NOx by at least 85%, from approximately 102 pounds emitted per hour to approximately 16 pounds per hour.

The settlement appears to serve the purposes of all the parties. On the one hand, the EPA sees the settlement as ensuring that engines meet requirements and encouraging environmental projects that benefit nearby communities as well as making the air cleaner not just for nearby neighborhoods but also for the Southern Wisconsin region as a whole. On the other hand, the companies avoided a much more severe penalty that might have been imposed by a court given the breadth, number and type of violations.

Federal Court Finds that Judicial Deference Does Not Mean "Do Everything Federal Entity Requests"

Barbara E. Lichman, Ph.D., J.D. — Tue, 27 Mar 2012 10:39:23 -0800

Challengers to the determinations of Federal agencies do not go to court on a level playing field with their governmental adversaries. Federal courts have long taken the position that deference is properly accorded to an agency making decisions within its area of technical expertise. That position may now be changing, at least with respect to two specific sets of legal circumstances.

The first set of circumstances deals with settlements. In SEC v. Citigroup Global Markets, Inc., 2011 W.L. 5903733 (S.D.N.Y.), Judge Jed S. Rakoff rejected a $285 million settlement between the Securities and Exchange Commission (“SEC”) and Citigroup which he believe had not been adequately supported. Specifically, the Judge found the settlement was vague concerning the rationale for a charge of negligence in what was clearly a well thought out scheme of “shorting” dubious investments it had just sold to investors; the total losses suffered by investors; and the penalty amount that would have been imposed.

In a hearing on those questions, counsel for the SEC took the position that the Judge had no business assessing the “public interest” in the settlement, as it was not part of the applicable standard of review. The Judge firmly disagreed. Analogizing the applicability of the public interest standard in settlements to its applicability in injunctive relief, the Court held that it could not be asked to “exercise my power and not my judgment,” particularly where Supreme Court authority held that a court cannot grant injunctive relief without considering the public interest. Ultimately, refusing to be “a mere handmaiden to a settlement privately negotiated on the basis of unknown facts,” the Court ordered the parties to trial in July, 2012.

The second circumstances under which deference may be attenuated in the future occurs mainly in actions involving the National Environmental Policy Act, 42 U.S.C. § 4321 (“NEPA”). In typical NEPA cases, courts give almost total deference to the adequacy of a project’s environmental review by a Federal agency that has been delegated by Congress with the authority to promulgate rules implementing Congress’ clearly expressed statutory purpose. U.S. v. Mead Corp., 533 U.S. 218, 227-228 (2001). However, in a very recent, untypical case, Tinicum Township, et al. v. U.S. Department of Transportation, et al., still pending in the United States 3rd Circuit Court of Appeals, the Federal agency delegated with that rulemaking and implementation power, the United States Environmental Protection Agency (“EPA”) took strong and unchanging issue with the adequacy of the review by the Federal Aviation Administration (“FAA”) of the Philadelphia International Airport Capacity Enhancement Project (“Project”). Tinicum Township is the first, if not the only, case in which the challenger has pled that, even though FAA is the agency delegated to perform environmental review, it is EPA that deserves deference in its conclusion that the Project’s review was inadequate.

As can be seen from the above situations, the concept of deference may be in transition. From a specific perspective, this change could most notably affect the level of judicial review of settlements and NEPA compliance. More generally, the transition could implicate cognizable separation of powers issues between the Executive and Judicial branches of government.

A California Appellate Court Puts a Fence Around Federal Preemption of Airport Safety Standards

Barbara E. Lichman, Ph.D., J.D. — Thu, 22 Mar 2012 14:48:05 -0800

On March 20, 2012, in a far reaching opinion, the California Appellate Court for the Second District incurred into the territory usually occupied by the Federal Courts of Appeals, by holding that Federal Aviation Administration (“FAA”) safety standards, published in FAA Advisory Circular 150/5300-13 (“Advisory Circular”) do not preempt state tort law on the standard of care applicable to utilization of an airport’s “Runway Protection Zone” (“RPZ”).

The case, Sierra Pacific Holdings, Inc. v. County of Ventura, 2012 WL 920322 (Cal.App.2 Dist.)), concerns damage to an aircraft owned by Sierra Pacific Holdings, Inc. (“Sierra”), allegedly caused by a barrier erected within the RPZ at Camarillo Municipal Airport. The airport, owned and operated by Ventura County (“County”), erected the barrier for the apparent purpose of preventing runway incursions by police vehicles leasing space in part of the RPZ at the airport. The trial court upheld the County’s motion in limine to exclude evidence of state safety standards relating to “airport design and construction,” on the ground that Federal standards in the Advisory Circular preempt state tort law on the standard of care. The trial court’s holding was based on the Federal government’s “implied preemption” of safety standards at airports, and, thus, the foreclosure of Sierra’s negligence action based on a dangerous condition of public property under state tort law. Cal. Gov. Code § 835. The Appellate Court reversed on the ground that “Congress has not enacted an express preemption provision for FAA safety standards” and, thus, if preemption exists, it must be implied. The Appellate Court’s decision is flawed for at least two reasons.

First, the Court ignored an explicit statement of Congressional purpose to preempt state safety standards set forth in 49 U.S.C. § 40103. In that section, Congress stated unequivocally that “the United States government has exclusive sovereignty of airspace of the United States,” § 40103(a)(1). Congress delegated that sovereignty to the FAA Administrator, including the right to “prescribe air traffic regulations on the flight of aircraft,” § 40103(b)(2), which are required to include traffic regulations “protecting people and property on the ground” § 40103(b)(2)(B), and, most notably, “preventing collisions between aircraft and land or water vehicles . . .,” § 40103(b)(2)(D) [emphasis added]. As the barrier at issue was erected by the County to exclude vehicles from the RPZ and runway, and, thus, “prevent collision between aircraft and land . . . vehicles” using the runway and/or RPZ, its regulation falls directly within the Federal government’s express preemptive power under § 40103.

Second, even if for argument’s sake, an implied preemption analysis were required, the Appellate Court misconstrued the scope of Advisory Circular 150/5300-13. Relying on a portion of the Advisory Circular’s introduction (“[U]se of this AC is mandatory for all projects funded with federal grant monies through the Airport Improvement Program (AIP) and with revenue from the Passenger Facility Charges (PFC) Program.” Advisory Circular, Introduction, § 3), the Court found that the Advisory Circular only becomes mandatory where Federal funding is accepted for the specific project at issue in the litigation, here the barrier allegedly causing the damage.

The Court failed to recognize, however, that the RPZ and associated safety surfaces were Federally funded with AIP and/or PFCs, and, consequently, are safety surfaces to which the Advisory Circular’s standards apply. The barrier, far from being a project eligible for Federal funding, is precisely the sort of incursion meant to be excluded by the statute and associated regulations. Thus, the Advisory Circular is mandatory with respect to the prevention of safety hazards within and upon the RPZ, and, under the Court’s reasoning, should preempt state law with respect to those safety standards.

In short, and despite its holding, the approach taken by the 2nd District Appellate Court leaves open the question of whether the preemption provision of Federal Aviation Act § 40103 governing the scope of FAA jurisdiction over operation of aircraft and associated airport safety facilities expressly or impliedly preempts state tort law challenges.

Operators Seeking to Close Airports Navigate Difficult Regulatory Shoals

Barbara E. Lichman, Ph.D., J.D. — Wed, 21 Mar 2012 10:08:36 -0800

The permanent closure or “deactivation” of an underutilized public use airport has gained increasing traction among revenue starved airport sponsors, as well as disparate responses from affected parties. Operators seek to save the drain on diminishing budgets; residential communities surrounding the airport hope for relief from the airport’s impacts; and the pilot community sees its access to the dwindling number of general aviation facilities shrinking further. Whatever the rationale, the operator seeking to close and reuse an airport for non-aviation purposes, that has at any time accepted funds from the Federal Aviation Administration (“FAA”), faces substantial regulatory hurdles and complex procedural requirements.

First, closure of an airport requires a “release” from Federal grant obligations. A “release” “is defined as the formal written authorization discharging and relinquishing the FAA’s right to enforce an airport’s contractual obligations,” FAA Order 5190.6B, § 22.2 (all references will be to FAA Order 5190.6B). These may either be a release from a particular grant assurance or Federal contractual obligation, or may affirmatively permit disposal of some or all of the airport’s property, § 22.2. The airport sponsor’s obligation to the FAA for personal property ends with the physical useful life of the property. However, airport land acquired with Federal funds is federally obligated in perpetuity, § 22.3.

In considering whether to grant a release, the FAA will generally determine whether the release, including that of an entire airport, will have the “potential to protect, advance or benefit the public interest in aviation,” § 22.4.a. More specifically, it will determine: “(1) the reasonableness and practicality of the sponsor’s request; (2) the effect of the request on needed aeronautical facilities; (3) the net benefit to civil aviation; (4) the compatibility of the proposals with needs of civil aviation,” § 22.4.a(1)-(4).

The standards imposed also differ markedly for the disposal of personal and real property. While the FAA may grant a release that permits the sponsor to abandon, demolish, or convert the personal property before its useful life expires, it will do so only when one of the following applies: (1) the facility is no longer needed for the purpose for which it was developed; (2) normal maintenance will no longer sustain the facility’s serviceability; or (3) the facility requires major reconstruction, rehabilitation, or repair, § 22.15.b. The FAA may require the sponsor, as a condition of the release, to reimburse the Federal government or reinvest in an improved Airport Improvement Program (“AIP”) eligible project, § 22.15.d.

The standards for releasing real property are far more restrictive. FAA consent “shall be granted only if it is determined that the property is not needed for present or foreseeable public airport purposes,” § 22.16. Most notably, the airport account must receive fair market value compensation for all deletions of airport real property from the airport even if the sponsor does not sell the property or sells the property below fair market value, § 22.16. In addition, a total release permitting sale or disposal of federally obligated land must specify that the sponsor is obligated to include in any conveyance of a property interest a reservation assuring the continued right of flight and the ability to cause aircraft noise at unlimited levels over the land released, § 22.16.a. Moreover, the conveyance must also “(1) prohibit the erection of structures or growth of natural objects that would constitute an obstruction to air navigation; [and] (2) prohibit any activity on the land that would interfere with or be a hazard to the flight of aircraft over the land or to and from the airport, or that interferes with air navigation and communications facilities serving the airport,” § 22.16.

Finally, the requirements of release for the sale or disposal of real property differ according to the date of the Federal grant. If no grant was received after December 30, 1987, “a sponsor’s request [for release] must assure that the Federal government shall be reimbursed or the Federal share of the net proceeds will be reinvested (a) in the airport, (b) in a replacement airport, or (c) in another operating airport,” § 22.19.a(1). Where a grant was received after December 30, 1987 for land other than for noise compatibility purposes, an airport sponsor must dispose of the land at fair market value and deposit the Federal share of the sales proceeds into the Trust Fund, § 22.19.b(1). In other words, for an airport that has received a grant after December 30, 1987, the flexibility on the disposition of any sales proceeds is eliminated.

Whether an airport can be closed and/or transferred for non-aviation purposes depends almost entirely on the discretion of the FAA Associate Administrator for Airports whose discretion may not be delegated, § 22.20. It is, therefore, critically important to follow all the procedural steps in obtaining a release, as well as the substantive requirements discussed here. It should also be noted that where an airport was acquired as Federal surplus property from the military, different and even more restrictive regulation of transfer may exist.

EPA Issues "Amendment" to Definition of Condensable Particulate Matter as Regulated New Source Review Pollutant

Barbara E. Lichman, Ph.D., J.D. — Mon, 19 Mar 2012 12:41:59 -0800

On Thursday, March 16, 2012, the Environmental Protection Agency (“EPA”) took the almost unprecedented step of publishing in the Federal Register a correction to its prior definition of “regulated new source review pollutant” (“Rule”) contained in two sets of Prevention of Significant Deterioration (“PSD”) regulations, 40 C.F.R. §§ 51.166 and 52.21, and in EPA’s Emissions Offset Interpretative Ruling, 40 C.F.R. Part 51, Appendix S, 77 Fed.Reg. 15,656. The purpose of the revision is to correct an “inadvertent error” dating back to the Rule’s promulgation in 2008 when the then-existing definition was changed to require that particulate matter emissions, both PM10 and PM2.5, representing three separate size ranges of particulates, must include “gaseous emissions, source or activity which condense to form particulate matter at ambient temperatures,” i.e., condensable particulate matter. See, e.g., 40 C.F.R. § 51.166(b)(49)(vi). Previously, EPA’s regulations only required the filterable fraction, not the condensable particulate matter, to be considered for new source review purposes. The 2008 change therefore imposed an unintended new requirement on State and local agencies and the regulated community.

The now apparent rationale for the revision (besides political pressure from governmental agencies and the emitting community), is that EPA no longer regulates the ambient indicator, total suspended particulates, with which the indicator “particular matter emissions” is associated. Therefore, there is no “compelling” reason for requiring the condensable PM portion to be counted toward the measure of particulate matter emissions from stationary sources for PSD applicability determinations and establishing emissions limitations.

Finally, the revision will restore consistency in the regulation of these indictors for particulate matter under the PSD program with EPA’s original intent. Specifically, this would mean PM10 and PM2.5 pollutants will be regulated as criteria pollutants, i.e, under the definition covering “any pollutant for which a National Ambient Air Quality Standard has been promulgated,” and would be required to include the condensable PM fraction emitted by the source. In addition, “particulate matter emissions” would be regulated as a non-criteria pollutant (that is under the portion of the definition that refers to “any pollutant that is subject to any standard promulgated under § 111 of the Act”) without a general requirement to include the condensable PM fraction emitted by a source.

While this change may seem insignificant to the general public, the regulated community that will be affected by it is not small, and includes, but is not limited to, miscellaneous chemical products, natural gas liquids, natural gas transportation, pulp and paper mills and automobile manufacturing. These industry segments will be relieved of expensive and time consuming burdens caused by EPA’s “inadvertent error,” and, thus, will not be required to pass these costs on to the consumer.

Tinicum Township, Pennsylvania's Challenge to the Philadelphia International Airport Expansion Project Goes to Court

Barbara E. Lichman, Ph.D., J.D. — Tue, 13 Mar 2012 14:46:00 -0800

On Tuesday, March 6, 2012, Tinicum Township, Pennsylvania and its partners County of Delaware, Pennsylvania; Thomas J. Giancristoforo; and David McCann (“Petitioners”) took their grievances with the ongoing expansion project at Philadelphia International Airport (“PHL”) to the 3rd Circuit Federal Court of Appeals in Philadelphia. Petitioners, made up of communities and residents surrounding the airport, expressed their concern with the Federal Aviation Administration’s (“FAA”) often-ignored failure to adequately disclose and analyze the project’s air quality and land use impacts.

Relying most heavily on consistent objections to the project by the Environmental Protection Agency (“EPA”) the Federal agency delegated by Congress with the power to promulgate and enforce regulations governing Clean Air Act compliance, Petitioners asserted that their claims are based on: (1) FAA’s failure to comply with the disclosure and analysis requirements of the National Environmental Policy Act, 42 U.S.C. § 4321, et seq., (“NEPA”); (2) the EPA’s right to receive deference from the Court to its negative views of the project because, in the 3rd Circuit, “deference follows delegation,” see, e.g., Chao v. Community Trust Company, 474 F.3d 75, 85 (3rd Cir. 2007); and (3) FAA’s violation of the Airport Airway Improvement Act, 49 U.S.C. § 47101, et seq., (“AAIA”) requirement that airport projects be reasonably consistent with the existing plans of jurisdictions authorized by the State in which the airport is located to plan for the development of the area surrounding the airport. 49 U.S.C. § 47106(a)(1). FAA disagreed with Petitioners’ assertions of deference and claimed that they had complied with the AAIA by relying on the plans of the Delaware Valley Regional Planning Commission. (See Philadelphia Inquirer, March 6, 2012 and Delaware County Daily Times, March 7, 2012 for catalog of FAA arguments.)

The three judge panel expressed satisfaction with the scope of the oral argument, but is not subject to any specific time period within which to render its decision.

FAA Reauthorization Act Changes Rules for Valuation of Residential Properties

Barbara E. Lichman, Ph.D., J.D. — Mon, 06 Feb 2012 15:26:08 -0800

Exemption of NextGen procedures from environmental review is not the only issue raised by the FAA Reauthorization legislation set to be approved by the United States Senate on Monday, February 6 at 5:30 p.m. EST. Section 505 of the Conference Version of the Bill allows a public entity taking private residential properties by eminent domain for airport purposes to pay the value of the property after its value has been diminished by the pendency of the project itself, and by any delay by the public entity in purchasing the property. In other words, the Congress is overriding the long held judicial precept that “temporary takings are as protected by the Constitution as are permanent ones.” See, e.g., First Evangelical Lutheran Church of Glendale v. Los Angeles County, California, 482 U.S. 304, 318 (1987).

Specifically, § 505 amends 49 U.S.C. § 47504 to allow the Federal Aviation Administration to “disregard any decrease or increase in the fair market value of the real property caused by the project for which the property is to be acquired, or by the likelihood that the property would be acquired for the project. . .” Thus, hypothetically, once government announces a program of eminent domain, it may wait an unlimited time to appraise the property in the hope that the value will diminish by virtue of the threat itself, or of the deterioration of the surrounding areas caused by voluntary relocation in the face of the threat of condemnation.

This is precisely the inequity the weight of Supreme Court jurisprudence has sought to eliminate. It is true that this case differs nominally from the typical case of “inverse condemnation,” i.e., a taking by government of all economically viable use of a property by regulation without just compensation, Tahoe Sierra Preservation Council, Inc. v. Tahoe Regional Planning Agency, 535 U.S. 302, 350 (2002). However, the absence of compensation for the indeterminate period before the actual purchase of the property, during which time the property arguably has no economically viable use, is paramount to the “temporary” taking at issue in, among other seminal cases, Lucas v. South Carolina Coastal Council, 505 U.S. 1003 (1992).

In summary, the FAA Reauthorization Act adds the insult of potential undisclosed impacts of new NextGen procedures on previously non- or marginally impacted communities, to the injury of reduced compensation for residential properties eventually impacted, even if the reduction in value of those properties is caused by the airport’s intentional delay in purchasing the property.

There May Still Be Time to Weigh in on the Congressional Action to Exempt the NextGen Technologies from NEPA Review

Barbara E. Lichman, Ph.D., J.D. — Fri, 03 Feb 2012 15:54:37 -0800

As we reported yesterday in our blog titled “FAA Reauthorization Act Exempts Next Generation Airspace Redesign Projects from Environmental Review,” Congress is set to act on the conference version of H.R. 658 (“Act”), a Bill the nominal purpose of which is to fund the Federal Aviation Administration (“FAA”) for 2011-2014, a task Congress has been unable or unwilling to accomplish for the last two years.

The legislation goes far beyond funding, however. Toward another stated purpose - to “streamline programs” - the Act sets out the parameters for establishment and operation of FAA’s Next Generation Transportation System (“NextGen”). Not stopping there, it also “creates efficiencies” by exempting the NextGen program from environmental review under the National Environmental Policy Act, 42 U.S.C. § 4321, et seq. (“NEPA”), Act, § 213. Thus, whole communities around at least 30 “core” airports might be newly impacted by aircraft overflights seemingly without the opportunity for public review and comment before the NextGen project is implemented, and without an avenue of leverage in the courts afterwards. All is not yet lost, however.

Citizens appear to have at least three remaining means to obtain relief. First, H.R. 658 is set for Congressional consideration at 5:30 p.m., Monday, February 6, 2012. However, if communities around airports throughout the United States weigh in en masse with their Senators and Congressmen, between now and then, by e-mail, the legislation’s summary consideration may be considerably lengthened. With enough vocal opposition from the public, it is even possible, though not probable, that the offending § 213 may be deleted.

Another strategy for overcoming the obstacle to environmental relief being established by Congress involves response to the solicitation of comments on proposed changes to FAA regulations, 14 Code of Federal Regulations § 91, 121, 125, 129 and 135, 76 Fed.Reg. 77,939 (December 15, 2011), adding regulations governing NextGen. The Congressional exemption from NEPA allows for the Administrator to exercise discretion in deciding whether “extraordinary circumstances exist with respect to the procedure,” such that the presumption of no significant environmental effect may be abrogated. § 213(c)(1) and (2). Thus, relevant comments on the new regulations would include an exhortation to the Administrator to expand the parameters of the “extraordinary circumstances,” from the already existing factors of increased fuel consumption, carbon dioxide emissions and noise, to include revision in flight paths that bring aircraft over communities not previously overflown, and which substantially lower altitudes over communities that are currently overflown.

Finally, and hopefully as a last resort, there remains recourse to other Federal statutes as a basis for court action. A categorical exclusion under NEPA does not excuse FAA from complying with its obligations under other environmental statutes.

In short, what is critically important in the short run is: (1) a massive and focused campaign to convince our Congressional representatives that the public health and welfare should be as well protected as administrative “efficiencies;” and (2) a well-orchestrated set of comments on the regulatory revisions governing NextGen to take advantage of the loopholes in the Federal legislation.

FAA Reauthorization Act Exempts Next Generation Airspace Redesign Projects from Environmental Review

Barbara E. Lichman, Ph.D., J.D. — Thu, 02 Feb 2012 16:19:44 -0800

In a monument to political deal making, the United States Congress is today considering, in the House and Senate Aviation Committees, the "FAA Modernization and Reform Act of 2012," H.R. 658 ("Act") to, among other things, "authorize appropriations to the Federal Aviation Administration for fiscal years 2011-2014 . . ." It is, however, the other provisions of the legislation which most profoundly affect the public.

Purportedly to "streamline programs, create efficiencies, reduce waste and improve safety and capacity," the most recent version of the Act to emerge from the House-Senate Conference Committee exempts all new area navigation ("RNAV") and required navigation performance ("RNP") procedures, which collectively comprise the "Next Generation Air Transportation System" ("NextGen"), Act § 201, Definitions, from environmental review under the National Environmental Policy Act, 42 U.S.C. § 4321, et seq. ("NEPA").

The Act, generally, mandates that all "navigation performance and area navigation procedures developed, certified, published or implemented under this section [Section 213] shall be presumed to be covered by a categorical exclusion (as defined in § 1508.4 of Title 40, C.F.R.) under Chapter 3 of FAA Order 1050.1E, unless the Administrator determines that extraordinary circumstances exist with respect to the procedure." Act, § 213(c)(1).

The Act expands on this mandate in § (c)(2). "NEXTGEN PROCEDURES - Any navigation performance or other performance based navigation procedure developed, certified, published or implemented that, in the determination of the Administrator, would result in measurable reductions in fuel consumption, carbon dioxide emissions, and noise, on a per flight basis, as compared to aircraft operations that follow existing instrument flight rule procedures in the same airspace, shall be presumed to have no significant effect on the quality of the human environment and the Administrator shall issue and file a categorical exclusion for the new procedure."

Certainly some of the duplication will be removed in the Act's final version. But the bottom line will remain. Dramatic changes in the configuration of the national airspace system, to be implemented throughout the United States during the next few years, will be relegated to "a category of actions which do not individually or cumulatively have a significant effect on the human environment and which have been found to have no such effect in procedures adopted by a federal agency in implementation of these regulations . . . and for which, therefore, neither an environmental assessment nor an environmental impact statement is required." 40 C.F.R. § 1508.4. This is so despite the fact that, in many cases, the new NextGen procedures will implicate numerous communities never before overflown, or never overflown at the same low altitudes. Newly affected populations will thereby be deprived of an avenue of redress in the courts through NEPA on which they have come to depend to level the playing field usually dominated by governmental action. The fundamental intent of NEPA, to allow the public a chance to review and comment on governmental actions before they are taken, will effectively be bypassed by the Act.

Nor do the conditions on a finding of categorical exclusion, such as the requirement for a measurable reduction in fuel consumption, carbon dioxide or noise, mitigate the adverse impacts of the exemption, as the determination that those conditions exist is within the exclusive discretion of the FAA Administrator, the same party charged with implementing the NextGen program.

There are two potential courses of action still available to interested parties and affected populations. The first is short term: to call Senators and Congressmen to express opposition to the apparent end run around NEPA's protections. The second is longer term, and involves other statutes that can be applied to take up where NEPA protections will now leave off. The next few days will determine whether the legal strategy in alternative two will eventually be required. First, it's time for the affected public to weigh in with its political leaders to protect its best interests. Stay tuned for the next chapter.

Barbara E. Lichman, Ph.D., J.D. to Join Buchalter Nemer

Barbara E. Lichman, Ph.D., J.D. — Fri, 27 Jan 2012 09:19:34 -0800

As a valued friend, we want to share with you the exciting news that, on Monday, January 30, 2012, we will be joining the law firm of Buchalter Nemer, a premier land use, real estate and environmental law firm with offices throughout the Southwest. Buchalter’s expertise in areas of law such as water rights, land use permitting, air quality, environmental compliance and real estate transactions will strongly support our efforts on your behalf.

As of January 30, 2012, please feel free to reach us at:

Buchalter Nemer
18400 Von Karman Avenue
Suite 800
Irvine, California 92612-0514
Direct Dial: (949) 224-6292
Phone: (949) 760-1121
Fax: (949) 720-0182
Email: blichman@buchalter.com
www.buchalter.com

We look forward to your continued friendship and an even greater capacity to serve you. Please don’t hesitate to contact us with any questions.

Legislature Asked to Grant CEQA Relief for Rail Projects

Barbara E. Lichman, Ph.D., J.D. — Thu, 12 Jan 2012 09:22:39 -0800

Following in the footsteps of his colleagues, on January 6, 2012, Assemblyman Mike Feuer introduced legislation that would give rail projects the same type of relief from California Environmental Quality Act (“CEQA”) requirements that were received in the last session by the proposed NFL stadium in Los Angeles, and some renewable energy projects. Notably, the CEQA amendments enacted for the NFL stadium include a very short time frame of 175 days for resolution of CEQA issues. While current CEQA litigation may extend to two years or more, depending on the complexity of the project and workload of the court, it stands to reason that issues surrounding local projects such as the stadium, with local traffic, noise and air quality impacts, may potentially be resolved within the 175 day timeframe. Rail projects are of far different scope, geographic extent, and are subject to a different set of laws.

Indeed, the geographic size of rail projects implicates the greater scope of legal applicability. Rail projects, even if, like the current “high speed rail,” limited to within the borders of California, will, of necessity, be recipients of Federal funding. Consequently, Federal environmental statutes, including the National Environmental Policy Act, 42 U.S.C. § 4321, et seq., and the Federal Clean Air Act, 42 U.S.C. § 7501, et seq., apply. Thus, while the California legislature may attenuate the CEQA process, the rail projects will still remain hostage to NEPA.

Finally, even if rail projects could proceed without Federal funding, which they most likely cannot, where they cross state lines, the Interstate Commerce Clause of the United States Constitution is implicated, and Federal law will apply. In short, to attenuate the environmental review process for major transportation projects will require a different legislative template, at a different legislative forum, the United States Congress.

Happy New Year Except for California Redevelopment Agencies

Barbara E. Lichman, Ph.D., J.D. — Wed, 04 Jan 2012 11:30:02 -0800

As far back as 1946 when the California Legislature first passed legislation enabling the establishment of redevelopment agencies, the concept of restoring aging urban neighborhoods has played a key role in the character and identity of California cities. This role, which was enhanced by government money during the era of “urban renewal” in the 1960s, has now been effectively obviated by a ruling of the California Supreme Court which, on Thursday, December 27, 2011, held in favor of a recent State law abolishing the State’s 400 local redevelopment agencies. The Court also ruled against a compromise measure which would have allowed the redevelopment agencies to continue in operation with the sharing of their revenues with the State General Fund. Localities are now faced with the quandary of how to make up the shortfall. Several new ideas have been advanced at both the State and local levels.

The Court’s action is a double-edged sword. On the one side is the more than $1 billion in revenue that will accrue to the State which would have gone to the local redevelopment agencies. Those who supported the legislation justify it by pointing to the use of redevelopment funds to support self-serving action by local government, including the purported catering to rich developers, and the alleged sponsoring of fancy field trips for redevelopment agency members. Those who opposed the legislation point to redevelopment agencies’ role in the resuscitation of depressed neighborhoods and their replacement with low income and elderly housing as well as job creating commercial areas.

Both positions have a point, and both have problems. While it is true that local redevelopment coffers (enhanced by “tax increment financing” which returns to the local jurisdiction the difference between the appraised value of the local neighborhood in its original condition and its appraised value after redevelopment) are often raided for purposes other than redevelopment, it is also true that redevelopment has demonstrated notable successes in the past such as San Diego’s Gas Lamp District, and the development of new low income housing where only hulks of burned tenements stood before.

Of course, even the newly refurbished housing stock had an additional cost which served to condemn redevelopment – the hidden relocation of low income households from their original dwellings. While Federal funds are available for relocation of those who cannot afford alternate housing, even low income, those funds have been misused and misallocated with as much frequency as the funds required for the underlying development, often leaving the poor and displaced to fend for themselves.

Finally, the court also rejected a proffered compromise that would have allowed the redevelopment agencies to continue in existence with a revenue sharing agreement with the State government. Ironically, it was the forces opposed to the underlying legislation that brought about the demise of the “compromise” legislation by opposing it and challenging it in court. At this juncture, however, the localities that opposed the demise of the redevelopment agencies say that they will settle for “anything they can get.” It remains to be seen if the Legislature will adhere to their request and enact new legislation allowing for the continued existence of the agencies on some, as yet unspecified, terms.

SCAG's Regional Transportation Plan Falls Down Hard on Aviation Policy

Barbara E. Lichman, Ph.D., J.D. — Fri, 30 Dec 2011 15:14:34 -0800

The recently published Southern California Association of Governments (“SCAG”) Draft Regional Transportation Plan 2012-2035, Sustainable Communities Strategy (“Draft RTP”) is a study in contrasts. The Draft RTP is meant to be a roadmap to “increasing mobility for the region’s residents and visitors.” Draft RTP, p. 1. Its “vision” purportedly “encompasses three principles that collectively work as the key to our region’s future: mobility, economy and sustainability.” Draft RTP, p. 1. SCAG’s jurisdiction falls largely into compartments: (1) surface transportation such as roadways and rail; and (2) aviation. SCAG has funding authority over the former, but none over the latter.

The purpose of the Draft RTP is to portray transportation from a broader regional, rather than merely local, perspective. On the one hand, the Draft RTP’s analysis of surface transportation growth estimates, trends and proposed policies for the Southern California Region to the year 2035 contains relatively sophisticated and substantially complete analysis and projections that meet its goals. On the other hand, the Draft RTP’s analysis of aviation trends and policies for meeting airport demand is reminiscent of a high school science project.

For example, the Draft RTP anticipates that, after the “urban capacity constrained airports of Los Angeles International (“LAX”), Bob Hope, Long Beach and John Wayne Airports (sic)” all meet their “defined legally allowable or physical capacity constraints,” the remainder of the demand will be served at “suburban airports with ample capacity to serve future demand, including Ontario International, San Bernardino International, March Inland Port, Palmdale Regional, Southern California Logistics and Palm Springs airports.” Draft RTP, p. 58. While SCAG is correct about the availability of unused capacity at Ontario International (“ONT”) (which is at its lowest passenger level since 1987 despite ample facilities including a new, unused, terminal), SCAG is flat wrong in the assumption that: (1) the other named airports actually have usable capacity; and (2) the “remainder of the demand” will automatically be siphoned off to airports more remote than ONT (which is actually an urban airport in the midst of a highly developed and developing Inland Empire). For example, San Bernardino International Airport (“SBIA”), while sporting a new, completely empty, terminal with apparently ample groundside capacity, has serious airspace conflicts with ONT, as well as a $4,000 foot high mountain at the end of its principal runway.

The Draft RTP further opines that “congested airports have an interest in shifting traffic to less congested airports.” Draft RTP, p. 61. No they don’t. Airports earn revenue by, among other things, airline landing fees and concessions revenues like food and parking, which in turn depend on increasing numbers of passengers. The favored (although not always desirable) solution for congested airports is to simply create more capacity which is largely funded by Federal dollars appropriated by the Federal Aviation Administration (“FAA”), with little or no downside to the local operator.

Finally, the Draft RTP opines that “for airports like LAX which has a significant component of international traffic that generates more revenue than domestic flights, it may be more efficient to limit domestic flights that could be accommodated at other airports in the region, thereby freeing up capacity for more lucrative international flights.” Draft RTP, p. 61. As an organization charged with understanding transportation laws and regulations, SCAG should be aware that it is not up to the airport or the local jurisdiction that operates it to “limit domestic flights” or any flights for that matter. “The United States government has exclusive sovereignty of airspace of the United States,” 49 U.S.C. § 40103(a)(1), including the type of aircraft allowed to fly and where they may land. While other laws such as the Airport Noise and Capacity Act of 1990 (49 U.S.C. § 47521, et seq.) circumscribe the Federal government’s preemptive sovereignty to some extent, the local airport operator may only choose to construct, or not to construct, facilities to accommodate aircraft operations. Once such facilities exist, a local operator may not choose between operations based on their ultimate destinations.

In summary, while the Draft RTP’s general conceptual framework, analyzing transportation as a regional and cooperative issue among regional jurisdictions is supportable, the Draft RTP entirely omits from its aviation analysis reference to, or consideration of, the third party with the real power to make a difference in the allocation of regional air transportation resources – the FAA. Without such consideration, the Draft RTP’s aviation policies amount to nothing more than a wish list. The comment period on the Draft RTP extends until February 14, 2012.

The D.C. Circuit Court of Appeals Reconfirms the Bar of Standing in the Federal Courts

Barbara E. Lichman, Ph.D., J.D. — Thu, 29 Dec 2011 15:20:56 -0800

In National Association of Homebuilders, et al. v. Environmental Protection Agency, et al., 2011 W.L. 6118589 (December 9, 2011) (“Homebuilders”) the D.C. Circuit Court of Appeals has raised the bar for Article III standing in actions involving private petitioners or appellants. While recent years have seen a loosening of the standing requirements for states (see, e.g., Massachusetts v. EPA, 549 U.S. 497, 518 (2007) [“This is a suit by a state for an injury to it in its capacity of quasi-sovereign. In that capacity the state has an interest independent of and behind the titles of its citizens, and all the earth and air within its domain”], and municipalities (see, e.g., City of Olmsted Falls v. FAA, 292 F.3d 261, 268 (2002) [“In this Circuit we have found standing for a city suing an arm of the Federal government when a harm to the City itself has been alleged” [emphasis added]], Homebuilders represents an escalation of the existing standing restrictions for individuals and organizations that represent them.

Article III of the United States Constitution “limits Federal Court jurisdiction to ‘cases’ and ‘controversies.’ Those two words confine ‘the business of Federal Courts to questions represented in an adversary context and in a forum historically viewed as capable of resolution through the judicial process.’” Massachusetts, supra, 549 U.S. at 515, quoting Flast v. Cohen, 392 U.S. 83, 95 (1968). In order to establish Article III standing, “a litigant must demonstrate that it has suffered a concrete and particularized injury that is either actual or imminent, that the injury is fairly traceable to the defendant, and that it is likely that a favorable decision will redress that injury.” Massachusetts, supra, 549 U.S. at 517. In Homebuilders, the National Association of Homebuilders (“NAHB”), which represents a variety of individual developers, brought suit challenging the determination by the United States Environmental Protection Agency (“EPA”) and United States Army Corps of Engineers (“ACOE”) that certain reaches of the Santa Cruz River in Arizona constitute “Traditional Navigable Waters” (“TNW”), thus subjecting those reaches to Federal regulation. The Court in Homebuilders rejected NAHB’s attempts to fit under the umbrellas of organizational, representational or procedural standing on the following grounds.

With respect to organizational standing, the Court opined that “NAHB must ‘demonstrate that it has suffered injury in fact including such concrete and demonstrable injury to the organization’s activities – with a consequent drain on the organization’s resources – constituting more than simply a set back to the organization’s abstract social interests.” Homebuilders, supra, at * 2. The Court found that NAHB’s allegations of expended staff time and monetary resources on legal services and lobbying did not establish the requisite allegation that the action “perceptibly impaired” a non-abstract interest, Id. quoting Havens Realty Corp. v. Coleman, 455 U.S. 363, 379 (1982). The Court did not, however, explain what would have been a sufficient allegation.

With respect to representational standing, the Court reiterated the test for establishing representational standing in which “an association must demonstrate that (a) its members would otherwise have standing to sue in their own right; (b) the interest it seeks to protect are germane to the organization’s purpose; and (c) neither the claim asserted nor the relief requested requires the participation of individual members in the lawsuit.” Id. at * 3. The Court went on to find that NAHB had not met this burden because it had not sufficiently alleged any threat of injury in fact to any of its members traceable to the TNW Determination. This was in spite of several declarations submitted by third parties purporting to have knowledge of the possible adverse impacts of the TNW Determination on owners and developers on the banks of the river. Apparently, however, none of the declarations were from those owners or operators, nor were any directly affected parties also parties to the lawsuit.

Finally, the Court denied NAHB’s claim of procedural standing as well, even though “a litigant to whom Congress has accorded a procedural right to protect his concrete interests – here the right to challenge agency action unlawfully withheld, § 7607(b)(1) – can assert that right without meeting all the normal standards for redressability and immediacy.” Massachusetts, supra, 549 U.S. at 517. “When a litigant is vested with a procedural right that litigant has standing if there is some possibility that the requested relief will prompt the injury causing party to reconsider the decision that allegedly harmed the litigant.” Id. at 518. However, in Homebuilders, the Court found that NAHB had failed to meet the same standard it had failed to meet with respect to either organizational or representational standing, i.e., it had failed to allege any concrete interest of any of its members affected by the deprivation of the procedure, without which Article III standing could not be maintained.

Based on the above analysis, it appears that NAHB required only one short additional step toward the goal of establishing standing. As “only one of the petitioners needs to have standing to permit [the Court] to consider the petition for review,” Massachusetts, supra, 549 U.S. at 517, NAHB could potentially have established standing if one of its members, directly affected by the TNW Determination, had become a party and supplied a declaration setting forth the “injury in fact” that was, or would be, caused by the implementation of the TNW Determination. With an individual allegation of “concrete and particularized injury” that is “imminent” “fairly traceable” to the TNW Determination, and remediable by a favorable decision of the Court, the case could have gone forward without the necessity for the complex analysis in which the Court ultimately engaged, and potentially without the adverse outcome to NAHB.

LAX Grows Like "Topsy" While Ontario Starves

Barbara E. Lichman, Ph.D., J.D. — Wed, 28 Dec 2011 11:31:14 -0800

An interesting dichotomy was observable in recent news coverage of the utilization of the two major airports owned and operated by the City of Los Angeles. On the one hand, in a recent story, the Los Angeles Times reported that the City of Los Angeles’ Board of Airport Commissioners, the administrative agency charged with overseeing the operation of the City’s airports, is considering closing one of the two terminals at Ontario International Airport (located in the City of Ontario, but operated by Los Angeles World Airports (“LAWA”)). The stated reason was that Ontario has lost one-third of its peak 7.2 million passengers from 2007 to 2010, putting Ontario “on track to have as many passengers as it saw in 1987.” On the other hand, a story in the Los Angeles Business Journal touts passenger increases at LAX of between 3% and 10% over the period April through October, 2011. What the latter story does not do is venture an analysis of the potential causes of this enormous disparity.

Despite the economic downturn, there is still potential ridership, for Ontario, not only in Riverside and San Bernardino Counties, but also in Northern Orange County and parts of San Diego County that are closer to Ontario than to the coastal airports of John Wayne Airport and San Diego International Airport, located in their own counties.

Even a moderate degree of analysis reveals the true cause of the disparity: favorable treatment of LAX by the City of Los Angeles, to the severe detriment of Ontario’s future. For example, despite its facial commitment to “regionalization” of air traffic, i.e., the dispersion of passengers among the various airports in the region, affirmed in its settlement of a case brought by various impacted parties in 2004, City of El Segundo, et al. v. City of Los Angeles, et al., LAWA has apparently enticed air carriers to move to LAX by lower costs and fees, in order to pay the cost of its major, ongoing expansion project.

Ontario is left the orphan, saddled with hefty City employee contractual obligations; a $4.50 per passenger Passenger Facility Charge; and among the highest per passenger costs in the entire region, with little or no marketing effort by LAWA during the past three years to ameliorate these disparities.

What is clear from a comparative analysis of the passenger traffic at the two venues is that LAWA’s defense, i.e., “there won’t be any net growth until you see the economy bounce back,” is without a cognizable basis. If the economy were the controlling factor, LAX would also be experiencing a decline, or at least less growth. That LAX is booming is proof positive of the views of Inland Empire officials who have taken the consistent position that “LAWA which operates both LAX and Ontario has become an absentee landlord bent on completing a multi-billion dollar modernization of LAX at the expense of its weaker stepchild and potential competitor 56 miles to the east.”

American Airlines Declares Bankruptcy

Barbara E. Lichman, Ph.D., J.D. — Tue, 29 Nov 2011 10:35:38 -0800

This morning, November 29, 2011, American Airlines, one of the biggest airlines in the world, announced that it had declared Chapter 11 bankruptcy. It is not unexpected news, as American has been declaring losses in excess of $1 billion per year for some time. What remains to be seen is, among other things: (1) whether American will review its devotion to the “hub and spoke” system and begin a return to “point to point” routes that have allowed Southwest to remain profitable for a period of 35 years; (2) whether American will maintain its schedules throughout its system during the bankruptcy; (3) whether American will continue to court its best customers with the continuation of the “Advantage Miles” program; and (4) perhaps most urgent, whether American will enhance its customer service, in the model of Southwest Airlines, in order to retain and attract customers. The story is still unwritten. Stay tuned.