Opinion ID: 2038160
Heading Depth: 1
Heading Rank: 3

Heading: the department's decision: burden of proof; standard of review.

Text: Our review of the evidence and our disposition of the related arguments are guided by a cluster of principles. First of all, because the petitioners could proceed with the proposed financings only in amounts determined by the department to be reasonably necessary (G.L.c. 164, § 14; St. 1975, c. 775, § 17), they had the burden of presenting, in support of their applications, evidence sufficient to enable the department to make those essential determinations. Fitchburg I, supra at 678. In fulfilling its responsibility the department had wide latitude in the admission of evidence ( AAA Movers v. Department of Pub. Utils., 354 Mass. 390, 393 [1968]) and in the determination of credibility ( Framingham v. Department of Pub. Utils., 355 Mass. 138, 146 [1969]). Once it rendered a decision the department was required to supplement it with a statement of reasons, including a determination of each necessary issue of fact or law. G.L.c. 30A, § 11 (8) (1984 ed.). See School Comm. of Chicopee v. Massachusetts Comm'n Against Discrimination, 361 Mass. 352, 355 (1972) (duty to make subsidiary findings of fact on all issues relevant and material to the ultimate issue and to describe the manner in which it reasoned from those subsidiary facts to the ultimate decision). See also Hamilton v. Department of Pub. Utils., 346 Mass. 130, 137 (1963) (right to use `technical competence and specialized knowledge in the evaluation of the evidence' ... may be reflected in the specific findings but does not make specific findings unnecessary [citation omitted]). In light of the department's duty to make specific findings, we give detailed attention not only to the arguments alleging that the department erred in not considering evidence from the separate financing cases on such matters as energy need, alternative sources of power, financial planning, economic analysis, and rate impact, but also to the fact that the department's decision does not contain an evaluation of or findings based on that evidence. Initially, we point out that such issues are not relevant and material to the questions of cost, completion, and operating characteristics at issue in the generic proceeding. Although they may be relevant and material to the issues in the separate financing cases, we do not discern error in that context because the department did not deny those applications for reasons related to matters of energy need and alternative sources of power; but did so because the proposed issuance ... [could not] be determined to be reasonably necessary based on an economic analysis of the project. It decided that the economic analyses that it had intended to make in the individual financing cases would, if based on the substantially understated cost and construction schedule estimates, be meaningless. Under the circumstances, this is an appropriate choice by the department. Logic warrants, if not compels, its decision that determination of the threshold issues (of cost and completion schedule) obviated any need to reach the issues in the separate financing cases. As a result, we do not have the dilemma of not knowing whether the department disbelieved evidence presented in those financing cases or believed it but considered it not determinative. Cf. School Comm. of Chicopee v. Massachusetts Comm'n Against Discrimination, supra ; Westborough v. Department of Pub. Utils., 358 Mass. 716, 717-718 (1971). After considering only the evidence in the generic case, the department made findings and specifically identified the failure to present a reasonable range of possible cost estimates supported by reviewable and more realistic construction schedules and the failure to meet their burden of providing ... a credible analysis of the potential costs of the project. Notwithstanding the emphasis on the inadequacies of their presentation, the petitioners argue that the department's determination is not supported by substantial evidence. We may set aside a department decision which is not so supported. G.L.c. 30A, § 14 (7) ( e ) (1984 ed.). Although the standard (substantial evidence) is not easily defined, it is such evidence as a reasonable mind might accept as adequate to support a conclusion. G.L.c. 30A, § 1 (6) (1984 ed.). See Boston Edison Co. v. Department of Pub. Utils., 393 Mass. 244, 249 n. 8 (1984). We are to give due weight to the experience, technical competence, and specialized knowledge of the department. G.L.c. 30A, § 14. Here the burden is on the petitioners to show that the order is invalid. G.L.c. 25, § 5. We believe, as the ensuing discussion demonstrates, that a reasonable mind would consider that the evidence before the department supports its determination that the petitioners had not met their burden of proof. See Deacon Transp., Inc. v. Department of Pub. Utils., 388 Mass. 390, 395 (1983). The petitioners relied in substantial part on the testimony of William Derrickson, the senior vice president of New Hampshire Yankee Division of Public Service Company of New Hampshire (PSNH), who represented that specific project milestones were achievable, based on his engineering analysis, his management plans, his experience in managing the construction of another nuclear power plant, and his personal familiarity with Seabrook I. The department reviewed the information provided regarding the achievement of certain milestones in the construction of the plant and determined that the date for achieving one (the cold hydro test) was supported by an adequate analysis of each major task. However, it considered the information supplied regarding achievement of subsequent milestones to lack the necessary level of detail, although that had been requested, to permit appropriate review. Material with that level of detail did not exist but was being developed. The department determined that, without the information, it was impossible to verify Derrickson's ability to achieve the schedule he had developed; that the establishment of a schedule without a greater level of supporting detail generated questions as to whether the schedule represented a realistic evaluation of the remaining work; and stated that the petitioners had presented unreviewable assertions that achievement of certain milestones was attainable. It noted that other than Derrickson's judgment there was insufficient project-specific, detailed engineering analysis at the task level to permit a conclusion that the portion of the construction schedule (between the cold hydro and hot functional milestone) was reasonable. Moreover, it concluded that, if it were to rely on industry experience as a guide to Seabrook's likely completion date, it could not accept the August, 1986, estimate. The department then examined Derrickson's experience as project manager of another nuclear power plant to determine whether that would support his schedule for Seabrook I but found there to be significant differences between the two plants, so that the view that the schedule for the other plant is achievable for Seabrook was not acceptable. It also reviewed information on recent work at Seabrook I in light of Derrickson's schedule and found that the schedule was not being achieved. The department therefore concluded that the August, 1986, completion date offered by the investor-owned utilities through Derrickson was unsupported on the record. It found the earliest reasonable completion date to be August, 1988, and that there was a substantial likelihood, given industry experience and Seabrook's history, of its being later. The department also reviewed construction costs and financing costs for Seabrook I. The petitioners relied on the testimony of Derrickson, who stated that it could be built for a total cost of $4.5 billion, based on an in-service date of August, 1986. The department found that, because substantial portions of the projected schedule were insufficiently detailed to permit review of its reasonableness, it was also precluded from making a detailed evaluation of the reasonableness of the construction cost estimate. It decided that, because both the completion date and the construction cost estimate were overly optimistic, Derrickson's estimated allowance for funds used during construction was also understated. Thus, the department found that the petitioners had failed to meet their burden of providing a credible analysis of the potential costs, as well as the completion date, of the project. The department specifically viewed the evidence in the context of the extremely disappointing past history of the project [10] and it was justified in so doing. On review, we believe that a reasonable mind would perceive the evidence as supporting the department's finding that the petitioners had not met their burden of proof.