Source: https://supreme.justia.com/cases/federal/us/367/396/
Timestamp: 2019-04-20 13:10:46+00:00

Document:
"the final design provides reasonable assurance . . . that the health and safety of the public will not be endangered by operation of the reactor."
"that a utilization facility of the general type proposed . . . can be constructed and operated at the location without undue risk to the health and safety of the public,"
and it continued in effect the provisional construction permit, subject to substantially the same condition. The Court of Appeals set aside the order and remanded the case to.the Commission.
Held: the Court of Appeals erred in setting aside the Commission's order continuing the provisional construction permit in effect. Pp. 367 U. S. 398-416.
(a) It is clear from the face of the statute that Congress contemplated a step-by-step procedure: first, an applicant would have to get a construction permit, then he would have to construct his facility, and then he would have to ask the Commission to grant him a license to operate the facility. Pp. 367 U. S. 403-405.
that operation of the facility "will provide adequate protection to the health and safety of the public." Pp. 367 U. S. 405-406.
(c) Under the provisions of the Act and the Commission's regulations, the Commission proceeded properly in issuing the provisional construction permit on a finding of reasonable assurance in the record that a utilization facility of the general type proposed could be constructed and operated at the location proposed without undue risk to the health and safety of the public, and deferring until application for the grant of an operating license a definitive finding that operation of the facility "will provide adequate protection for the health and safety of the public." Pp. 367 U. S. 406-410.
(d) A different conclusion is not required by the legislative history of the Act. Pp. 367 U. S. 410-414.
(e) Before granting a permit for construction of a reactor near a large population center, the Commission is not required to find that there are "compelling reasons" for doing so. P. 367 U. S. 414.
(f) This Court cannot assume that the Commission will exceed its powers in passing on an application for a license to operate the reactor or that the many safeguards provided to protect the public interest will not be fully effective. Pp. 367 U. S. 414-416.
108 U.S.App.D.C. 97, 280 F.2d 645, reversed, and case remanded.
This case is the first contested licensing proceeding to be decided by the Atomic Energy Commission under the Atomic Energy Act of 1954, 68 Stat. 919, 42 U.S.C. § 2011 et seq. It presents the question whether the Commission erred in continuing in effect a provisional construction permit which authorizes the petitioner Power Reactor Development Company to construct, but not to operate, a fast-neutron breeder reactor for the generation of electric power. The Court of Appeals for the District of Columbia Circuit set that order aside. 108 U.S.App.D.C. 97, 280 F.2d 645 (1960). We granted certiorari, 1960, 364 U.S. 889, on petitions of the United States and of Power Reactor Development Company (hereafter PRDC), to decide an important question of the scope of the Commission's power under the Atomic Energy Act of 1954.
"It is undisputed that the Commission must make such a finding when it authorizes operation. The question is whether it must make such a finding when it authorizes construction. In our opinion, it must."
its resolution, it will be necessary to state the proceedings in the case at some length, and then describe in detail the government statute and administrative regulations. For the decision of this case ultimately turns on a comparison of what the Commission found with what the statute and regulations require.
high level, these safety rods are intended to drop into the reactor automatically and shut it down immediately. The whole machine is housed in a series of thick concrete, graphite, and steel layers, all underground. Over this entire complex is placed a football-shaped building, enclosed in a two-inch steel shield capable of containing an explosion equal in force to 1,000 pounds of TNT, which is greater than any explosion which any of the experts who testified in this case believes is at all likely to result from an accident in the operation of the reactor. The application, after describing the reactor in much greater detail than this rudimentary summary, went on to provide that the reactor would be located at Lagoona Beach, Mich., on the shores of Lake Erie, about 35 miles from the center of Detroit, Mich., and about 30 miles from the center of Toledo, Ohio.
"The conversion of this permit to a license is subject to submittal by PRDC to the Commission (by amendment of the application) of the complete, final Hazards Summary Report (portions of which may be submitted and evaluated from time to time). The final Hazards Summary Report must show that the final design provides reasonable assurance . . . that the health and safety of the public will not be endangered by operation of the reactor. . . ."
"22. The Commission finds reasonable assurance in the record that a utilization facility of the general type proposed in the PRDC application and amendments thereto can be constructed and will be able to be operated at the location proposed without undue risk to the health and safety of the public."
construction permit in effect, but containing the same condition which the original permit, issued on August 4, 1956, had contained.
"public safety is the first, last, and a permanent consideration in any decision on the issuance of a construction permit or a license to operate a nuclear facility."
"that its construction permit is provisional upon further demonstration of many technological and financial facts, including the complete safety of the reactor."
"[t]he degree of 'reasonable assurance' . . .
that satisfies us . . . for purposes of the provisional construction permit would not be the same as we would require in considering the issuance of the operating license."
"22. The Commission finds reasonable assurance in the record, for the purposes of this provisional construction permit, that a utilization facility of the general type proposed in the PRDC Application and amendments thereto can be constructed and operated at the location without undue risk to the health and safety of the public."
The intervening unions, respondents in this Court, then petitioned the Court of Appeals for the District of Columbia Circuit to review and set aside this order of the Commission. Only the final order continuing the permit in effect was drawn in question. No complaint was made of the original ex parte grant of the permit in 1956. PRDC intervened in the Court of Appeals in support of the AEC. On June 10, 1960, by a divided vote, a three-judge panel of the Court of Appeals set aside the AEC's order and remanded the case to the Commission. A petition for rehearing en banc was denied, two judges dissenting, and we brought the case here.
"issue licenses to persons applying therefor for utilization and production facilities involved in the conduct of research and development activities. . . . In issuing licenses under this subsection, the Commission shall impose the minimum amount of such regulations and terms of license as will permit the Commission to fulfill its obligations under this chapter to promote the common defense and security and to protect the health and safety of the public. . . ."
Two things about this section should be emphasized. First, there is no doubt that the term "licenses" as used therein includes the provisional construction permit which PRDC has received. The last sentence of § 185, 42 U.S.C. § 2235, expressly so provides, as we shall soon see. And second, there is also no doubt that construction permits, like all other licenses, can be issued only consistently with the health and safety of the public. But the responsibility for safeguarding that health and safety belongs under the statute to the Commission. And § 104b, especially when read in connection with the general rulemaking power conferred by § 161(i)(3), 42 U.S.C. § 2201(i)(3), clearly contemplates that the Commission shall by regulation set forth what the public safety requires as a prerequisite to the issuance of any license or permit under the Act.
construction permit shall expire, and all rights thereunder be forfeited, unless, upon good cause shown, the Commission extends the completion date. Upon the completion of the construction or modification of the facility, upon the filing of any additional information needed to bring the original application up to date, and upon finding that the facility authorized has been constructed and will operate in conformity with the application as amended and in conformity with the provisions of this chapter and of the rules and regulations of the Commission, and in the absence of any good cause being shown to the Commission why the granting of a license would not be in accordance with the provisions of this chapter, the Commission shall thereupon issue a license to the applicant. For all other purposes of this chapter, a construction permit is deemed to be a 'license.'"
nuclear material will be in accord with the common defense and security and will provide adequate protection to the health and safety of the public."
It is clear from this provision that, before licensing the operation of PRDC's reactor, the AEC will have to make a positive finding that operation of the facility will "provide adequate protection to the health and safety of the public." What is not clear, and what is at the center of the controversy in this case, is whether the Commission must also have made such a finding when it issued PRDC's construction permit. There is nothing on the face of either § 182 or § 185 which tells us what safety findings must be made before this preliminary step is taken. We know, however, from § 104b that some such finding must be made. For enlightenment on the nature of this finding, both parties urge us to examine the Commission's regulations, and accordingly we proceed to do so.
to its later production and an evaluation by the Commission that the final design provides reasonable assurance that the health and safety of the public will not be endangered."
"that [the AEC] has information sufficient to provide reasonable assurance that a facility of the general type proposed can be constructed and operated at the proposed location without undue risk to the health and safety of the public,"
is a valid exercise of the rulemaking power conferred upon the AEC by statute, and requires that some finding as to safety of operation be made even before a provisional construction permit is granted. The question is whether that first finding must be backed up with as much conviction as to the safety of the final design of the specific reactor in operation as the second, final finding must be.
We think the great weight of the argument supports the position taken by PRDC and by the Commission, that Reg. 50.35 permits the Commission to defer a definitive safety finding until operation is actually licensed. The words of the regulation themselves certainly lean strongly in that direction. The first finding is to be made, by definition, on the basis of incomplete information, and concerns only the "general type" of reactor proposed.
"involves a contemporaneous construction of a statute by the men charged with the responsibility of setting its machinery in motion; of making the parts work efficiently and smoothly while they are yet untried and new."
"to conduct hearings in either open or executive session for the purpose of receiving information concerning the development, growth, and state of the atomic energy industry,"
Governmental Indemnity for Private Licensees and AEC Contractors Against Reactor Hazards, 84th Cong., 2d Sess., pp. 62-65 (1956); A Study of AEC Procedures and Organization in the Licensing of Reactor Facilities, 85th Cong., 1st Sess., pp. 11-14, 100-108 (Joint Comm. Print 1957). No change in this procedure has ever been suggested by the Committee, although it has on occasion been critical of other aspects of the PRDC proceedings not before us. It may often be shaky business to attribute significance to the inaction of Congress, but, under these circumstances and considering especially the peculiar responsibility and place of the Joint Committee on Atomic Energy in the statutory scheme, we think it fair to read this history as a de facto acquiescence in and ratification of the Commission's licensing procedure by Congress. Cf., e.g., Ivanhoe Irr. Dist. v. McCracken, 357 U. S. 275, 357 U. S. 292-294 (1958); Brooks v. Dewar, 313 U. S. 354, 313 U. S. 360-361 (1914). This same procedure has been used in each of the nine instances in which the Commission has granted a provisional construction permit for a developmental nuclear power reactor, e.g., Yankee Atomic Elec. Co., CPPR-5 (AEC 1957), and we hold that it was properly used in this case.
reasonable assurance that the general type of reactor proposed could be operated without undue risk to the health and safety of the public. Its Finding 22, which we have quoted, was in the very words of Reg. 50.35, except for the insertion of the phrase, "for the purposes of this provisional construction permit." This phrase was merely declaratory of the nature of the proceeding before the Commission, and in no way denigrated the finding as to safety of operation.
the Dow Chemical-Detroit Edison and Associates atomic power development project, predecessors of PRDC); pp. 226-227 (statement of E. H. Dixon, chairman of the Committee on Atomic Power of the Edison Electric Institute and president of Middle-South Utilities, Inc.); p. 417 (statement of the Special Committee on Atomic Energy of the Association of the Bar of the City of New York). In spite of these pleas, however, the bill was unchanged. Industry spokesmen renewed the argument the next year, when they sought unsuccessfully to have § 185 amended. Hearings on Development, etc., 84th Cong., 1st Sess., pp. 258, 261 (1955). Even a glance at § 185 suffices to show that issuance of a construction permit does not make automatic the later issuance of a license to operate. For that section sets forth three conditions, in addition to the completion of the construction, which must be met before an operating license is granted: (1) filing of any additional information necessary to bring the application up to date -- information which will necessarily in this case include detailed safety data concerning the final design of petitioner's reactor; (2) a finding that the reactor will operate in accordance with the act and regulations -- i.e., that the safety and health of the public will be adequately protected -- and with the construction permit itself, which is expressly conditioned upon a full investigation and finding of safety before operation is permitted; and (3) the absence of any good cause why the granting of a license to operate would not be in accordance with the Act -- e.g., a showing by respondent unions, who will have full rights to appear and contest the issuance of an operating license, that the reactor may not be reasonably safe.
"and no construction permit shall be issued by the Commission until after the completion of the procedures established by section 182 for the consideration of applications for licenses under this act."
consistent administrative practice, made known to Congress many times and never disturbed by it, would dictate this conclusion.
The Court of Appeals put forward as an alternative basis for its decision the holding that, under the law, the Commission may not authorize the construction of a reactor near a large population center without "compelling reasons" for doing so, 108 U.S.App.D.C. at 103-104, 280 F.2d at 651-652, and that no such reasons had been found by the AEC in this case. It is not clear whether respondents have abandoned that contention in this Court, and it is likewise uncertain whether they ever presented it to the Commission, a step which would ordinarily be a prerequisite to its consideration by the Court of Appeals. In any event, the position is without merit. The statute and regulations say nothing about "compelling reasons." Of course, Congress (and the Commission, too, for that matter) had the problem of safety uppermost in mind, and, of course, that problem is most acute when a reactor, potentially dangerous, is located near a large city. But the Commission found reasonable assurance, for present purposes, that the reactor could be safely operated at the proposed location, and that is enough to satisfy the requirements of law. The Commission recognized that the site and all its properties are among the most important ingredients of a finding of safety vel non. It considered the site along with all the other relevant data. There is no warrant in the statute for setting aside the Commission's conclusion.
many safeguards to protect the public interest will not be fully effective.
Accordingly, the judgment is reversed, and the causes are remanded to the Court of Appeals for further proceedings consistent with this opinion.
* Together with No. 454, United States et al. v. International Union of Electrical, Radio and Machine Workers, AFL-CI0, et al., also on certiorari to the same Court.
"in the absence of any good cause being shown to the Commission why the granting of a license would not be in accordance with the provisions of"
"Section 185 . . . requires the issuance of a license if the construction is carried out in accordance with the terms of the construction permit. [Footnote 3]"
In other words, the finding on "safety," if it is to be made (as it assuredly must be), must be made at the time the construction permit is issued, or not at all.
the public," it also finds that "[i]t has not been positively established" that a facility of this character "can be operated without a credible possibility of releasing significant quantities of fission products to the environment." The Commission added that there was "reasonable assurance" before the date when the facility went into operation that research and investigation would definitely establish "whether or not the reactor proposed by Applicant can be so operated."
Plainly these are not findings that the "safety" standards have been met. They presuppose -- contrary to the premise of the Act -- that "safety" findings can be made after construction is finished. But when that point is reached, when millions have been invested, the momentum is on the side of the applicant, not on the side of the public. The momentum is not only generated by the desire to salvage an investment. No agency wants to be the architect of a "white elephant." Congress could design an Act that would give a completed structure that momentum. But it is clear to me it did not do so.
"no construction permits shall be issued by the Commission until after the completion of the procedures established by section 182 for the consideration of applications for licenses under this act. [Footnote 4]"
That amendment would plainly have made the present findings inadequate, for they leave the issue of "safety" wholly in conjecture and unresolved.
of a license, because, had that been done, what it would have amounted to would be getting an investment of a substantial amount of capital, which surely would have been prejudicial in terms of the Commission issuing the license. In other words, if the Commission had granted the construction permit for some form of nuclear reactor, and then the question of a license was not fully resolved, surely there would have been considerable pressure, and justifiably so, for the Commission to have authorized the license once it had authorized the permit for construction."
"The chairman of the committee tells me he has modified certain sections by the committee amendments to the bill, of which at that time I was not aware. The chairman indicates to me that, under the terms of the bill, as amended, the construction permit is equivalent to a license. In other words, as I understand, under the bill, a construction permit cannot be interpreted in any other way than being equal to or a part of the licensing procedure. Is that correct?"
"A license and a construction permit are equivalent. They are the same thing, and one cannot operate until the other is granted."
"The same is true with reference to hearings. Therefore, we believe, and we assure the Senator, that the amendment is not essential to the problem which he is attempting to reach."
See Appendix to this opinion, post, p. 367 U. S. 419.
See Biological and Environmental Effects of Nuclear War, Summary -- Analysis of Hearings, June 22-26, 1959, Joint Committee on Atomic Energy, 86th Cong., 1st Sess.; Fallout From Nuclear Weapons Tests, Summary -- Analysis of Hearings, May 5-8, 1959, Joint Committee on Atomic Energy, 86th Cong., 1st Sess. For an analysis of the administrative law techniques used by the Commission in this case, see Jalet, A Study in Administrative Law, 47 Georgetown L.J. 47 (1958).
and source of special nuclear material required, the place of the use, the specific characteristics of the facility, and such other information as the Commission may, by rule or regulation, deem necessary in order to enable it to find that the utilization or production of special nuclear material will be in accord with the common defense and security and will provide adequate protection to the health and safety of the public. Such technical specifications shall be a part of any license issued."
"CONSTRUCTION PERMITS. -- All applicants for licenses to construct or modify production or utilization facilities shall, if the application is otherwise acceptable to the Commission, be initially granted a construction permit. The construction permit shall state the earliest and latest dates for the completion of the construction or modification. Unless the construction or modification of the facility is completed by the completion date, the construction permit shall expire, and all rights thereunder be forfeited, unless upon good cause, the Commission extends the completion date. Upon the completion of the construction or modification of the facility, upon the filing of any additional information needed to bring the original application up to date, and upon finding that the facility authorized has been constructed and will operate in conformity with the application as amended and in conformity with the provisions of this Act and of the rules and regulations of the Commission, and in the absence of any good cause being shown to the Commission why the granting of a license would not be in accordance with the provisions of this Act, the Commission shall thereupon issue a license to the applicant. For all other purposes of this Act, a construction permit is deemed to be a 'license.'"

References: § 2011
 § 185
 § 2235
 § 104
 § 161
 § 2201
 § 182
 § 185
 § 104
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 § 185
 § 185
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