Opinion ID: 539170
Heading Depth: 2
Heading Rank: 1

Heading: Timeliness of the Suspension Order

Text: 10 National argues that the Commission failed effectively to suspend National's rate increase because the Commission's suspension order was untimely. According to National, the time limit for suspending the rate under section 4(e) was controlled not by National's selection of an effective date--the Commission's position--but rather by the thirty-day minimum notice period established by section 4(d). Because the Commission suspended National's rate filing thirty-two days after it was filed, National contends that we must void the suspension order and direct the Commission to put National's filed rate into effect as of February 1, 1989, subject only to the Commission's power under section 5 to challenge the rate prospectively. 5 We disagree. 11 Our analysis of the Commission's interpretation of the Natural Gas Act is controlled by Chevron U.S.A. Inc. v. Natural Resources Defense Council, Inc., 467 U.S. 837, 104 S.Ct. 2778, 81 L.Ed.2d 694 (1984). [E]mploying traditional tools of statutory construction, we ask first whether Congress has directly spoken to the precise question at issue; if so, we must give effect to the unambiguously expressed intent of Congress. Id. at 842, 843 & n. 9, 104 S.Ct. at 2781, 2781 & n. 9. If not, we defer to the agency's interpretation of the statute so long as it is reasonable and consistent with the statutory purpose. Ohio v. Department of the Interior, 880 F.2d 432, 441 (D.C.Cir.1989); see Chevron, 467 U.S. at 843, 104 S.Ct. at 2782. 12 Congress has not spoken clearly to the issue of whether the Commission may exercise its section 4(e) suspension powers after expiration of the thirty-day notice period under section 4(d) but before the effective date of the filed rate. Section 4(d) states that 13 [u]nless the Commission otherwise orders, no change shall be made by any natural-gas company in any such rate, charge, classification, or service, or in any rule, regulation, or contract relating thereto, except after thirty days' notice to the Commission and to the public. 14 15 U.S.C. Sec. 717c(d) (emphasis added). Section 4(e) provides that the Commission may suspend the operation of a proposed rate increase for no more than five months beyond the time when it would otherwise go to into effect. 15 U.S.C. Sec. 717c(e). Neither the text nor the legislative history of these provisions expressly addresses the question of when the Commission must exercise its suspension power if the pipeline--as in this case--gives more than the thirty-day minimum notice required by section 4(d). 6 15 We find the Commission's answer to this question--that section 4(d) only requires the Commission to act prior to the proposed effective date, 46 F.E.R.C. at 62,290--to be perfectly reasonable and consistent with the statutory purpose. Ohio v. Department of the Interior, 880 F.2d at 441. Taken together, sections 4(d) and 4(e) evidence Congress' preference for the earliest effectuation of ... permissible rate changes consistent with appropriate Commission review. United Gas Pipe Line Co. v. Memphis Light, Gas & Water Div., 358 U.S. 103, 114, 79 S.Ct. 194, 200, 3 L.Ed.2d 153 (1958). By permitting suspension any time up to the effective date proposed by the pipeline, the Commission's reading of section 4(d) promotes the goal of agency review without detracting at all from the goal of early effectuation of permissible rate changes. Thus, we have no difficulty in concluding that the Commission's position reflects a permissible construction of the statute. Chevron, 467 U.S. at 843, 104 S.Ct. at 2782. 16 National resists this conclusion. Pointing to our decision in Indiana & Michigan Elec. Co. v. FERC, 502 F.2d 336 (D.C.Cir.1974), cert. denied, 420 U.S. 946, 95 S.Ct. 1326, 43 L.Ed.2d 424 (1975), National argues that the Commission's reading of section 4(d) is inconsistent with case law. National also maintains that the Commission's position represents an unjustified departure from agency policy. These contentions are without merit. 17 Indiana & Michigan Electric is not dispositive of the case at hand. In that case, we invalidated a FERC regulation requiring sixty days' notice for filing under section 205(d) of the Federal Power Act, which at the time of the decision was worded identically to section 4(d) of the Natural Gas Act. 7 We stated: 18 Thirty days is the maximum a utility can be compelled to wait from the time it files rate changes until the date the changes take effect unless the Commission properly exercises its suspension powers. 19 Id. at 341 (emphasis added). In this case, National, far from being compelled to wait more than thirty days before its rate became effective, chose to do so by filing its rate thirty-three days before the proposed effective date. As the Commission noted, see 46 F.E.R.C. at 62,289-90, Indiana & Michigan Electric says nothing about when the Commission must exercise its suspension powers in a case where a pipeline has elected to give more than the minimum thirty-day period of notice required by section 4(d). 8 But even if the case had directly addressed that question, Indiana and Michigan Electric, as a pre-Chevron decision, would not foreclose the Commission from reinterpreting an ambiguity in its organic statute. See Clinchfield Coal Co. v. Federal Mine Safety and Health Commission, 895 F.2d 773, 777-78 (D.C.Cir. 1990); Natural Resources Defense Council v. EPA, 859 F.2d 156, 187 (D.C.Cir.1988). 20 Nor did the Commission's decision in this case depart from agency precedent. As early as 1956, FERC's precursor, the Federal Power Commission, construed section 4 to permit suspension more than thirty days after a rate was filed but before the effective date announced by the pipeline. See Midstates Oil Corp., 16 F.P.C. 1213, 1214-15 (1956). In the only judicial decision directly addressing the issue, the Tenth Circuit upheld this reading of the statute in 1961. See Pan American Petroleum Corp. v. FPC, 287 F.2d 469, 471-72 (10th Cir.1961). The Commission has recently acknowledged this position, Idaho Power Co., 41 F.E.R.C. p 61,196 at 61,510 (1987), and National refers us to no case in which the Commission has disavowed it. 21 Nevertheless, because the Commission apparently takes action before thirty days in the majority of cases in which a pipeline gives more than the minimum notice period required by section 4(d), National argues that the Commission's suspension order in this case was contrary to FERC's settled practice. See Petitioner's Reply to FERC Letter at 1 (March 8, 1990). This argument is fallacious. The Commission's contention that it has the authority to suspend an as-yet ineffective rate more than thirty days after filing does not imply that the Commission is prohibited from suspending such a rate before thirty days if the Commission completes its review at an earlier point. In sum, National has failed to offer any ground for upsetting the Commission's permissible construction of the Natural Gas Act.