RICHARD E. LYNG, SECRETARY OF AGRICULTURE, AND THE DEPARTMENT OF
AGRICULTURE, PETITIONERS V. STATE OF IOWA, ETC., ET AL.

   No. 85-1818

   In the Supreme Court of the United States

   October Term, 1985

   On Petition for a Writ of Certiorari to the United States Court of
Appeals for the Eighth Circuit

   Reply Memorandum for the Petitioners

   Respondents pay scant attention to the statutory language that
plainly authorizes -- but does not require -- the Secretary to act in
the circumstances of this case.  Nor can respondents overcome the
absence of law to apply to enable a court to review the Secretary's
decision not to implement the discretionary SDPP in this instance.
Rather, respondents' submission serves to underscore the need for this
Court to review the Eighth Circuit's transformation of the Secretary's
discretionary authority into a mandatory benefits program.

   1. The decision below remanded the case to the district court to
"consider (respondents') requests for preliminary and permanent
injunctive relief compelling the Secretary to implement the SDPP"
(Pet. App. 16a-17a).  On remand, the district court required the
Secretary to promulgate final regulations.  In order to avoid the
confusion that would be generated by regulations "implementing" a
program under a decision this Court might reverse, we sought a stay of
proceedings pending disposition of the petition for a writ of
certiorari.  After initially entering a temporary stay, Justice
Blackmun denied our application on May 16, 1986.  In order to comply
with the district court's order, the Secretary published proposed
regulations on May 20, 1986 (51 Fed. Reg. 18552).  The State of Iowa,
a respondent in this case, filed what it describes as "a lengthy
Comment * * * attacking the Proposed Rule" (Br. in Opp. 13).  /1/ It
is now apparent that unless this Court halts the administrative
process set in motion by the decision below, pointless and protracted
litigation will ensue challenging the validity of regulations the
Secretary need never have issued.  Further litigation inevitably will
arise each time the Secretary decides whether to implement his
discretionary authority in a given emergency.  There is scarcely any
basis to suppose that Congress chose to have the Secretary's
discretionary response to emergency disaster situations restricted by
a bureaucratic straitjacket and subject to judicial hindsight, as
here, years after the event.  /2/ The statute makes it plain that
Congress intended nothing of the sort.  In place of the flexibility
and efficiency with which Congress intended the Secretary to respond
to emergencies, the decision below has planted the seed of
administrative encumbrance.  This Court should grant review to uproot
that seed before it germinates.

   2. Respondents are incorrect in stating (Br. in Opp. 20-21) that
the decision below follows established law.  As we have explained
(Pet. 18-19), the decision flies in the face of this Court's repeated
instruction that courts may not step in to supply criteria for agency
action where Congress has omitted to do so in its grant of
discretionary authority.  See Chevron U.S.A. Inc. v. Natural Resources
Defense Council, Inc., 467 U.S. 837, 842-845 & nn. 11-14 (1984);
Block v. Community Nutrition Institute, 467 U.S. 340 (1984);  Heckler
v. Chaney, No. 83-1878 (Mar. 20, 1985).  Moreover, the decision below
deprives Congress of the important power to delegate discretionary
authority based on conditions precedent without having a court intrude
its judgment into the process to create a mandatory program whenever
it believes the conditions are met.  Review is therefore warranted to
protect this important legislative option.

   3. Respondents assert (Br. in Opp. 15-16 (emphasis added)) that in
authorizing the discretionary SDPP, Congress "expected the Secretary
to provide disaster payments (under 7 U.S.C. 1444d(b)(2)(D)) when he
found" that certain enumerated conditions exist, i.e., (1) that there
is an economic emergency due to production losses caused by natural
disaster, (2) that federal crop insurance payments and other federal
assistance are "'insufficient to alleviate such economic emergency, or
no crop insurance covered the loss because of transitional problems
attendant to the federal crop insurance program;  and'" (3) that
"'additional assistance must be made available * * * to alleviate the
economic emergency.'" That Congress had no such "expectation" is
reflected in the plain language of the statute, which expressly states
that the Secretary "may" provide such payments on the condition that
such factors are found to exist.  As our petition (at 12-14, 17)
explains, neither the language nor structure of Section 1444d(b)(2)(D)
requires the Secretary to take the permitted action.  /3/ Indeed,
Congress expressly abolished the mandatory SDPP where federal crop
insurance is available (see 7 U.S.C. 1444d(b)(2)(A)-(C)), and couched
the authority granted under Subsection (D) in terms of the unqualified
permissive "may." The court of appeals has read this distinction out
of the Act, and has undone Congress's careful design to provide a
limited, discretionary power to be exercised in accordance with the
Secretary's judgment so as not to undermine the crop insurance program
and Congress's overall plan to reduce direct federal financial
involvement in the agricultural industry.  The decision below
effectively eliminates Congress's option to set threshold conditions
to trigger discretionary authority without converting the conditions
into an automatic mandate for action.  Cf. Young v. Community
Nutrition Institute, No. 85-664 (June 17, 1986).

   4. Respondents incorrectly assert (Br. in Opp. 16-18) that Senator
Heflin's remarks provide controlling legislative history.  As we have
explained (Pet. 17 nn. 16 & 17), Senator Heflin addressed only one
narrow aspect of the discretionary SDPP, i.e., the authority to grant
assistance where the inadequacy of crop insurance was due to
"transitional problems attendant to the Federal crop insurance
program" (7 U.S.C. 1444d(b)(2)(D)(ii)).  Senator Heflin's examples of
transitional situations in which the use of disaster payments "would
be equitable to producers" (S. Rep. 97-126, 97th Cong., 1st Sess. 78
(1981)) do not suggest a mandatory requirement, nor were they codified
in the statute.  Clearly, then, those remarks do not offer a court any
"law" to apply.  /4/

   5. The "administrative materials" relied on by respondents (Br. in
Opp. 18-20) also provide no guidance to a court considering the
Secretary's action in this case.  The cited materials all postdated
relevant legislation and do not address the question in this case:
the Secretary's decision whether to implement his discretionary
authority in a given emergency.  Rather, the materials upon which
respondents rely refer to questions that arise in administering the
program after the Secretary's decision to implement has been made.
Thus, respondents cite a GAO report written more than one year after
the Agriculture and Good Act of 1981 was enacted.  That report focused
on the situation that obtained when the Secretary chose to implement
the program of discretionary SDPP payments for certain countries in
Texas, Oklahoma and New Mexico in 1982;  it criticized the
administration of the program in that instance.  GAO, Report to the
Honorable Berkley Bedell, House of Representatives:  USDA Needs
Objective Criteria for Awarding Special Disaster Payments (Nov. 2,
1982) (hereinafter cited as GAO report).  /5/ As the dissent in the
court of appeals pointed out (Pet. App. 21a), the GAO report "has no
binding effect on the Secretary" and "specifically assumes that the
Secretary has decided to implement the program in a particular
situation and only suggests that the Secretary adopt uniform criteria
in determining what specific areas will be eligible to receive
payments." The report does not address the issue presented here, much
less provide "law" for a reviewing court to apply.  Moreover, the GAO
report (at 15) recognizes that "(t)he Agriculture and Food Act of 1981
provides USDA with discretionary authority to award special disaster
payments," and finds (id. at 16) "indications (that) suggest that
disaster payments discourage (federal crop insurance) participation."
Therefore, while it does not discuss the factors that might guide an
implementation decision, the GAO report implicitly supports the
Secretary's position that Congress intended to commit that decision to
the Secretary's sole discretion.

   Respondents also cite (Br. in Opp. 19) the "Report of (the)
Committee to Establish Special Disaster Payment Criteria" issued by
the Department of Agriculture in response to the GAO report.  As with
the GAO report to which it responds, the cited report does not purport
to bind the Secretary's hand in determining whether to invoke his
discretionary authority under Section 1444d(b)(2)(D) in the first
instance, but simply proposes uniform criteria (as recommended by the
GAO) for administering the program once it has been activated in a
given emergency.

   6. Respondents' remaining arguments are insubstantial.

   a. They contend (Br. in Opp. 22-23) that the anti-injunction
statute, 15 U.S.C. 714b(c), does not apply because this is a suit
against the Secretary under the Administrative Procedure Act, and not
against the Commodity Credit Corporation (CCC) or its property.  /6/
As Judge Fagg recognized (Pet. App. 22a-23a), that contention draws a
distinction without a difference.  Respondents have demanded
implementation of a program for payment of benefits administered by
the CCC out of CCC funds.  Thus, the ultimate relief sought in this
case amounts to an injunction against the CCC and its property, in
direct contravention of the express prohibition of 15 U.S.C. 714b(c).
It is appropriate for this Court to grant review in order to rectify
the Eighth Circuit's mistaken exercise of remedial authority.  See
Lyng v. Payne, No. 84-1948 (June 17, 1986).

   b. Respondents argue (Br. in Opp. 23-24) that the relief they
demand (implementation of the discretionary SDPP) would pose no danger
to the success of the congressionally-preferred crop insurance
program.  /7/ They assert that "(t)he holding (below) simply requires
that benefits be available where federal crop insurance (does not
cover the loss)," and point out (id. at 24) that "(i)f the Secretary
were able to implement a program of crop insurance that provided
adequate coverage for producers and smooth out transitional problems,
no payments would be made under the SDPP." This tautology is
irrelevant, because the statute prohibits SDPP payments where crop
insurance is adequate.  At all events, when Congress enacted the
discretionary SDPP it was concerned that the availability of cash
payments would detract from the successful implementation of the crop
insurance program.  S. Rep. 97-126, supra, at 75-76.  In order to
prevent that result, Congress chose to permit the Secretary, in his
discretion, to provide cash SDPP payments under very limited
conditions where he finds, inter alia, that crop insurance was
"insufficient" for a particular disaster situation.  Obviously, if
cash payments are automatically available whenever crop insurance is
"insufficient," there would be no occasion for an exercise of
discretion, and Congress's provision that the Secretary "may" provide
such payments in certain situations is converted to a directive that
he "must" provide payments whenever the conditions pertain.  Apart
from draining all meaning from the plain language of Section
1444d(b)(2)(D), respondents' argument is circular and would
effectively prevent the Secretary from successfully implementing the
crop insurance program:  producers would be discouraged from
purchasing crop insurance if they knew that SDPP benefits could be
obtained automatically and without cost to compensate for their
inadequate insurance coverage.

   c. Finally, respondents incorrectly accuse the Secretary (Br. in
Opp. 24-26) of trying to abolish the discretionary SDPP by
administrative fiat.  /8/ To the contrary, it was Congress that
discontinued cash disaster assistance in order to encourage greater
reliance on federal crop insurance.  As respondents state, the
administration bill for the 1981 Act proposed elimination of the
previous system of disaster payments.  See S. Rep. 97-126, supra, at
28-29.  That proposal was adopted in the final enactment.  7 U.S.C.
1444d(b)(2)(C).  All the major bills considered prior to enactment
focused on reducing the federal involvement in the agriculture
industry and substituting market factors as the prevailing norm.  S.
Rep. 97-126, supra, at 25-28.  The limited, discretionary SDPP
originated as a "new discretionary disaster payment program" (id. at
27 (emphasis added) (description of the bill proposed by Senator
Huddleston)) and a departure from the general trend, undertaken with
great caution to avoid undermining the success of crop insurance.  Id.
at 75-76.  By opposing the conversion of a clearly discretionary
program into a mandatory one, the Secretary is therefore simply
endeavoring to carry out the statute as envisioned by Congress.

   For the reasons stated above and in the petition, it is therefore
respectfully submitted that the petition for a writ of certiorari
should be granted.

   CHARLES FRIED

      Solicitor General

   JUNE 1986

   /1/ Pursuant to the district court order, the Secretary issued
final regulations effective June 9, 1986 (51 Fed. Reg. 21326).

   /2/ This case involves the SDPP provisions for feed grain producers
only, but the statutory language is identical to other provisions
relating to producers of rice, wheat, and upland cotton (see Pet.
n.1).  Thus, if the decision below is permitted to stand, it is
predictable that similar challenges will be generated under the
companion provisions for other crops.

   /3/ The three statutory findings are conditions that must be met
before the Secretary may even consider using his discretion under the
Act.

   /4/ In any event, respondents do not contend that Senator Heflin
described the situation in this case as one in which discretionary
payments would be appropriate.

   /5/ The GAO report (at 2) (emphasis added) states that "USDA used
its discretionary authority to award disaster payments in an
inconsistent manner" by designating certain counties for payments when
more seriously affected nearby counties were not designated, based on
"'subjective'" determinations of the severity of damage (id. at 9).
See also id. at 10.

   /6/ Respondents tellingly assert (Br. in Opp. 22-23 (emphasis
added)) that their quarrel is with the Secretary "for failing to carry
out his statutory mandate under 7 U.S.C. Section 1444d(b)(2)(D)." Of
course, Section 1444d(b)(2)(D) creates no mandate;  by its terms it is
simply a delegation of authority to agency discretion.

   /7/ Respondents also contend (Br. in Opp. 23-24) that the
Secretary's cost estimate for compulsory implementation is "grossly
inaccurate," but they suggest no alternative estimate or basis for
such an alternative.

   /8/ Indeed, as we have explained (Pet. 3-4 n.3), the Secretary did
provide considerable assistance to Iowa farmers under several other
federal programs and Iowa farmers received substantial indemnities
under the federal crop insurance program.