Opinion ID: 444114
Heading Depth: 3
Heading Rank: 1

Heading: The Staggers Act Certification Process

Text: 14 On the exhaustion issue, we have great difficulty with the ICC's sweeping assertion in this case that federal preemption completely forecloses any necessity of the ICC giving consideration to a state rehearing requirement. We do not conclude that federal preemption in the Staggers Act can be extended to such limits. Rehearing is a normal feature of administrative action and when properly applied for, and responded to, can work to substantially reduce subsequent litigation. We do not interpret the Staggers Act as ruling out all necessity to apply for rehearing in state cases. In the course of enacting the Staggers Act, Congress expressly rejected a sweeping federal preemption of the state regulatory role. Such preemption was originally provided for in the bill that became the Staggers Act, 6 but the attempt to oust the states completely from some regulatory role in intrastate rates was defeated. Instead, a compromise resulted which guaranteed that [i]ntrastate rail movements [in most cases] will continue to be regulated by state regulatory agencies with uniformity and consistency. 126 Cong.Rec. H8548 (daily ed. Sept. 9, 1980) (statement by Rep. Staggers). Rehearing is a normal, though not universal, feature of such state regulation. The legislative compromise was recorded in the Conference Report: states may only regulate in these areas if they are certified under the procedures of [section 11501]. H.Rep. No. 96-1430, 96th Cong., 2d Sess. 106 (conference), reprinted in 1980 U.S.Code Cong. & Ad.News 3978, 4110, 4138. Thus, the states' authority to regulate depends upon ICC certification of their regulatory procedures--which might include rehearing procedures--in order to ensure that federal standards established by and in accordance with the Staggers Act will be applied uniformly in determining intrastate rates. 15 We also reject the attempt by the ICC to find some support for its assumption of jurisdiction purely on the fact that Utah's intrastate rate regulation has been only provisionally certified. ICC Brief at 27 (emphasis in the original). This contention simply does not wash. In so contending the ICC attempts to inflate the scope of its own discretionary authority to a degree wholly unsupported by the Staggers Act. First of all, the Act does not provide explicit authority for a provisional certification. The purpose of the ICC in provisionally certifying was to act timely in order to bring complying states immediately under federal jurisdiction on intrastate rates, in the meantime depriving the state agencies of some of the benefits of a final certification by leaving open the capability of the ICC subsequently to reject certification if it should finally determine that the State Commission's standards and procedures were deficient. In the interim, though, the State Commission's standards and procedures must be considered to have been certified. A provisional certification is still a certification. It is not a partial certification. We find the conditional certification of the Utah standards and procedures to be valid. See Illinois Central Gulf Railroad Co. v. ICC, 720 F.2d 958, 962 (7th Cir.1983). The ICC in so acting was filling a void in the Staggers Act which permitted the agencies involved to carry out its basic intent and purpose that intrastate rail operations would conform to federal standards and procedures. Id. 16 Finally, we must reject the ICC's view of the certification process. The ICC appears to assert that even if it had certified an express rehearing petition requirement, it could nevertheless ignore a party's failure to comply with such a requirement, as any other course would render review of certified states' procedures in individual appeals impossible. ICC Brief at 27-28. We disagree that ICC review under such circumstances would become impossible. Because we hold, infra, that in the circumstances of this case the ICC was justified in exercising jurisdiction under section 11501(c), it is not necessary to address further the ICC's contention that it could ignore such a rehearing requirement if it were clearly stated and subsequently certified. 17