Under the Natural Gas Act (“NGA”), the Federal Energy Regulatory Energy Commission (“FERC”) has jurisdiction over development of interstate natural gas pipelines, except that a state may grant or deny a water quality certification application; provided the State acts timely. Millennium seeks to build a 9-mile pipeline from its main pipeline to the CPV combined cycle natural gas fired electric plant in Orange County, NY (called the Valley Lateral Project). Millennium Pipeline Company sued the New York State Department of Environmental Conservation (DEC), arguing it dragged its feet in ultimately denying its application.  At issue was a delay by the DEC to issue a Section 401 Water Quality Certification or denial for the pipeline project. By section 401 of the Clean Water Act, a State must grant or deny the certification application “within a reasonable period of time (which shall not exceed one year) after receipt of [a] request.” Id. Alcoa Power Generating Inc. v. FERC, 643 F.3d 963, 972 (D.C. Cir. 2011) (quoting 33 U.S.C. § 1341(a)(1)). If the State fails to act within that time period, the Act’s “certification requirements” are deemed “waived.” The U.S. Court of Appeals for the District of Columbia Circuit dismissed the lawsuit by Millennium, reasoning FERC had the power to override the DEC and issue the permits.  Thereafter, finding the DEC had waived its authority under Section 401, the FERC ordered the pipeline construction by Millennium to go forward. The FERC found the DEC acted untimely. The FERC also denied New York’s request for rehearing and stay, assuring that a federal court would determine the issue. It appears that FERC is taking a more proactive approach to State review. If it prevails, FERC may issue a similar order for the Constitution pipeline, possibly finding the DEC again acted untimely and their waived its authority to review its application. The DEC claims the FERC has misinterpreted when the time period for its review commences, contending the one year period did not commence until it deemed the application to be “complete”. The pipeline companies have asserted that the DEC review of water certification applications has become politicized to preclude pipeline development in NYS that might involve the transport of hdyrofracked natural gas. The Millennium matter presently resides with the United States Court of Appeals for the Second Circuit, which recently denied New York’s motion to stay construction.


About the Author:
Mark Lansing focuses his practice on property tax & condemnation matters with respect to energy, industrial and commercial properties. He achieves significant property tax savings and assessment reductions for his clients through litigation, negotiations (settlements), due diligence reviews and alternative agreements (e.g., PILOTs). Mark assists clients with their valuation of complex property, and through real property tax management. Mr. Lansing also works with energy, industrial and commercial companies in buying, building and operating facilities to effectively manage their property taxes, including due diligence review in the purchase or development phase, and representation before administrative agencies.

As an experienced trial lawyer, Mark has successfully represented clients in settlement negotiations, motions, trials and appeals at all levels of state and Federal Courts (including, Circuit Courts of Appeal). Mark is also well published in property tax and condemnation valuation matters. Mark may be reached in our Washington, D.C. office at 202.466.5964, or via email at mlansing@dickinsonwright.com and you may visit his bio here.