Opinion ID: 110718
Heading Depth: 1
Heading Rank: 4

Heading: The Tenth Amendment

Text: Unlike the Commerce Clause question, the Tenth Amendment issue presented here is somewhat novel. This case obviously is related to National League of Cities v. Usery, 426 U. S. 833 (1976), insofar as both concern principles of state sovereignty. But there is a significant difference as well. National League of Cities, like Fry v. United States, 421 U. S. 542 (1975), presented a problem the Court often confronts: the extent to which state sovereignty shields the States from generally applicable federal regulations. In PURPA, in contrast, the Federal Government attempts to use state regulatory machinery to advance federal goals. To an extent, this presents an issue of first impression. PURPA, for all its complexity, contains essentially three requirements: (1) § 210 has the States enforce standards promulgated by FERC; (2) Titles I and III direct the States to consider specified ratemaking standards; and (3) those Titles impose certain procedures on state commissions. We consider these three requirements in turn: A. Section 210. On its face, this appears to be the most intrusive of PURPA's provisions. The question of its constitutionality, however, is the easiest to resolve. Insofar as § 210 authorizes FERC to exempt qualified power facilities from State laws and regulations, it does nothing more than pre-empt conflicting state enactments in the traditional way. Clearly, Congress can pre-empt the States completely in the regulation of retail sales by electricity and gas utilities and in the regulation of transactions between such utilities and cogenerators. Cf. Southern Pacific Co. v. Arizona, 325 U. S. 761, 769 (1945). The propriety of this type of regulation  so long as it is a valid exercise of the commerce power  was made clear in National League of Cities, and was reaffirmed in Hodel v. Virginia Surface Mining & Recl. Assn .: the Federal Government may displace state regulation even though this serves to curtail or prohibit the States' prerogatives to make legislative choices respecting subjects the States may consider important. 452 U. S., at 290. Section 210's requirement that each State regulatory authority shall, after notice and opportunity for public hearing, implement such rule (or revised rule) for each electric utility for which it has ratemaking authority, 16 U. S. C. § 824a-3(f)(1) (emphasis added), is more troublesome. The statute's substantive provisions require electricity utilities to purchase electricity from, and to sell it to, qualifying co-generator and small power production facilities. § 824a-3(a). Yet FERC has declared that state commissions may implement this by, among other things, an undertaking to resolve disputes between qualifying facilities and electric utilities arising under [PURPA]. 18 CFR § 292.401(a) (1980). In essence, then, the statute and the implementing regulations simply require the Mississippi authorities to adjudicate disputes arising under the statute. Dispute resolution of this kind is the very type of activity customarily engaged in by the Mississippi Public Service Commission. See, e. g., Miss. Code Ann. §§ 77-1-31, 77-3-5, 77-3-13(3), 77-3-21, 77-3-405 (1973). Testa v. Katt, 330 U. S. 386 (1947), is instructive and controlling on this point. There, the Emergency Price Control Act, 56 Stat. 34, as amended, created a treble-damages remedy, and gave jurisdiction over claims under the Act to state as well as federal courts. The courts of Rhode Island refused to entertain such claims, although they heard analogous state causes of action. This Court upheld the federal program. It observed that state courts have a unique role in enforcing the body of federal law, and that the Rhode Island courts had jurisdiction adequate and appropriate under established local law to adjudicate this action. 330 U. S., at 394. Thus the state courts were directed to heed the constitutional command that the policy of the federal Act is the prevailing policy in every state, id., at 393,  `and should be respected accordingly in the courts of the State.'  Id., at 392, quoting Mondou v. New York, N. H. & H. R. Co., 223 U. S. 1, 57 (1912). So it is here. The Mississippi Commission has jurisdiction to entertain claims analogous to those granted by PURPA, and it can satisfy § 210's requirements simply by opening its doors to claimants. That the Commission has administrative as well as judicial duties is of no significance. [24] Any other conclusion would allow the States to disregard both the pre-eminent position held by federal law throughout the Nation, cf. Martin v. Hunter's Lessee, 1 Wheat. 304, 340-341 (1816), and the congressional determination that the federal rights granted by PURPA can appropriately be enforced through state adjudicatory machinery. Such an approach, Testa emphasized, flies in the face of the fact that the States of the Union constitute a nation, and disregards the purpose and effect of Article VI of the Constitution. 330 U. S., at 389. B. Mandatory Consideration of Standards. We acknowledge that the authority to make . . . fundamental . . . decisions is perhaps the quintessential attribute of sovereignty. See National League of Cities v. Usery, 426 U. S., at 851. Indeed, having the power to make decisions and to set policy is what gives the State its sovereign nature. See Bates v. State Bar of Arizona, 433 U. S. 350, 360 (1977) (State Supreme Court speaks as sovereign because it is the ultimate body wielding the State's power over the practice of law). It would follow that the ability of a state legislative (or, as here, administrative) body  which makes decisions and sets policy for the State as a whole  to consider and promulgate regulations of its choosing must be central to a State's role in the federal system. Indeed, the 19th-century view, expressed in a well-known slavery case, was that Congress has no power to impose on a State officer, as such, any duty whatever, and compel him to perform it. Kentucky v. Dennison, 24 How. 66, 107 (1861). Recent cases, however, demonstrate that this rigid and isolated statement from Kentucky v. Dennison  which suggests that the States and the Federal Government in all circumstances must be viewed as coequal sovereigns  is not representative of the law today. [25] While this Court never has sanctioned explicitly a federal command to the States to promulgate and enforce laws and regulations, cf. EPA v. Brown, 431 U. S. 99 (1977), there are instances where the Court has upheld federal statutory structures that in effect directed state decisionmakers to take or to refrain from taking certain actions. In Fry v. United States, 421 U. S. 542 (1975), for example, state executives were held restricted, with respect to state employees, to the wage and salary limitations established by the Economic Stabilization Act of 1970. Washington v. Washington State Commercial Passenger Fishing Vessel Assn., 443 U. S. 658 (1979), acknowledged a federal court's power to enforce a treaty by compelling a state agency to prepare certain rules even if state law withholds from [it] the power to do so. Id., at 695. [26] And certainly Testa v. Katt, supra , by declaring that the policy of the federal Act is the prevailing policy in every state, 330 U. S., at 393, reveals that the Federal Government has some power to enlist a branch of state government  there the judiciary  to further federal ends. [27] In doing so, Testa clearly cut back on both the quoted language and the analysis of the Dennison case of the preceding century. [28] Whatever all this may forebode for the future, or for the scope of federal authority in the event of a crisis of national proportions, it plainly is not necessary for the Court in this case to make a definitive choice between competing views of federal power to compel state regulatory activity. Titles I and III of PURPA require only consideration of federal standards. And if a State has no utilities commission, or simply stops regulating in the field, it need not even entertain the federal proposals. As we have noted, the commerce power permits Congress to pre-empt the States entirely in the regulation of private utilities. In a sense, then, this case is only one step beyond Hodel v. Virginia Surface Mining & Recl. Assn., supra . There, the Federal Government could have pre-empted all surface mining regulations; instead, it allowed the States to enter the field if they promulgated regulations consistent with federal standards. In the Court's view, this raised no Tenth Amendment problem: We fail to see why the Surface Mining Act should become constitutionally suspect simply because Congress chose to allow the States a regulatory role. 452 U. S., at 290. [T]here can be no suggestion that the Act commandeers the legislative processes of the States by directly compelling them to enact and enforce a regulatory program. Id., at 288. Similarly here, Congress could have pre-empted the field, at least insofar as private rather than state activity is concerned; PURPA should not be invalid simply because, out of deference to state authority, Congress adopted a less intrusive scheme and allowed the States to continue regulating in the area on the condition that they consider the suggested federal standards. [29] While the condition here is affirmative in nature  that is, it directs the States to entertain proposals  nothing in this Court's cases suggests that the nature of the condition makes it a constitutionally improper one. There is nothing in PURPA directly compelling the States to enact a legislative program. In short, because the two challenged Titles simply condition continued state involvement in a pre-emptible area on the consideration of federal proposals, they do not threaten the States' separate and independent existence, Lane County v. Oregon, 7 Wall. 71, 76 (1869); Coyle v. Oklahoma, 221 U. S. 559, 580 (1911), and do not impair the ability of the States to function effectively in a federal system. Fry v. United States, 421 U. S., at 547, n. 7; National League of Cities v. Usery, 426 U. S., at 852. To the contrary, they offer the States a vehicle for remaining active in an area of overriding concern. We recognize, of course, that the choice put to the States  that of either abandoning regulation of the field altogether or considering the federal standards  may be a difficult one. And that is particularly true when Congress, as is the case here, has failed to provide an alternative regulatory mechanism to police the area in the event of state default. Yet in other contexts the Court has recognized that valid federal enactments may have an effect on state policy  and may, indeed, be designed to induce state action in areas that otherwise would be beyond Congress' regulatory authority. Thus in Oklahoma v. CSC, 330 U. S. 127 (1947), the Court upheld Congress' power to attach conditions to grants-in-aid received by the States, although the condition under attack involved an activity that the United States is not concerned with, and has no power to regulate. Id., at 143. The Tenth Amendment, the Court declared, has been consistently construed `as not depriving the national government of authority to resort to all means for the exercise of a granted power which are appropriate and plainly adapted to the permitted end,'  ibid., quoting United States v. Darby, 312 U. S. 100, 124 (1941)  the end there being the disbursement of federal funds. Thus it cannot be constitutionally determinative that the federal regulation is likely to move the States to act in a given way, or even to coerc[e] the States into assuming a regulatory role by affecting their freedom to make decisions in areas of `integral governmental functions.'  Hodel v. Virginia Surface Mining & Recl. Assn., Inc., 452 U. S., at 289. Equally as important, it has always been the law that state legislative and judicial decisionmakers must give preclusive effect to federal enactments concerning nongovernmental activity, no matter what the strength of the competing local interests. See Martin v. Hunter's Lessee, 1 Wheat., at 340-341. This requirement follows from the nature of governmental regulation of private activity. [I]ndividual businesses necessarily [are] subject to the dual sovereignty of the government of the Nation and of the State in which they reside, National League of Cities v. Usery, 426 U. S., at 845; when regulations promulgated by the sovereigns conflict, federal law necessarily controls. This is true though Congress exercises its authority in a manner that displaces the States' exercise of their police powers, Hodel v. Virginia Surface Mining & Recl. Assn., Inc., 452 U. S., at 291, or in such a way as to curtail or prohibit the States' prerogatives to make legislative choices respecting subjects the States may consider important, id., at 290  or, to put it still more plainly, in a manner that is extraordinarily intrusive. Id., at 305 (POWELL, J., concurring). Thus it may be unlikely that the States will or easily can abandon regulation of public utilities to avoid PURPA's requirements. But this does not change the constitutional analysis: as in Hodel v. Virginia Surface Mining & Recl. Assn ., [t]he most that can be said is that the . . . Act establishes a program of cooperative federalism that allows the States, within limits established by federal minimum standards, to enact and administer their own regulatory programs, structured to meet their own particular needs. Id., at 289. [30] To be sure, PURPA gives virtually any affected person the right to compel consideration of the statutory standards through judicial action. We fail to see, however, that this places any particularly onerous burden on the State. Mississippi by statute already grants  [a]ny interested person . . . the right to petition the [Public Service] [C]ommission for issuance, amendment or repeal of a rule or regulation, Miss. Code Ann. § 77-3-45 (1973) (emphasis added), and provides that  any party aggrieved by any final finding, order or judgment of the commission shall have the right, regardless of the amount involved, of appeal in chancery court. Miss. Code Ann. § 77-3-67(1) (Supp. 1981) (emphasis added). Indeed, [a]ny person whose rights may be directly affected by said appeal may appear and become a party . . . . Ibid. And [a]ppeals in accordance with law may be had to the supreme court of the State of Mississippi from any final judgment of the chancery court. Miss. Code Ann. § 77-3-71 (1973). It is hardly clear on the statute's face, then, that PURPA's standing and appeal provisions grant any rights beyond those presently accorded by Mississippi law, and appellees point to no specific provision of the Act expanding on the State's existing, liberal approach to public participation in ratemaking. [31] In this light, we again find the principle of Testa v. Katt, supra , controlling: the State is asked only to make its administrative tribunals available for the vindication of federal as well as state-created rights. PURPA, of course, establishes as federal policy the requirement that state commissions consider various ratemaking standards, and it gives individuals a right to enforce that policy; once it is established that the requirement is constitutionally supportable, the obligation of states to enforce these federal laws is not lessened by reason of the form in which they are cast or the remedy which they provide. Testa v. Katt, 330 U. S., at 391. See Second Employers' Liability Cases, 223 U. S. 1, 57 (1912). In short, Titles I and III do not involve the compelled exercise of Mississippi's sovereign powers. And, equally important, they do not set a mandatory agenda to be considered in all events by state legislative or administrative decisionmakers. As we read them, Titles I and III simply establish requirements for continued state activity in an otherwise pre-emptible field. [32] Whatever the constitutional problems associated with more intrusive federal programs, the mandatory consideration provisions of Titles I and III must be validated under the principle of Hodel v. Virginia Surface Mining & Recl. Assn . [33] C. The Procedural Requirements. Titles I and III also require state commissions to follow certain notice and comment procedures when acting on the proposed federal standards. In a way, these appear more intrusive than the consideration provisions; while the latter are essentially hortatory, the procedural provisions obviously are prescriptive. Appellants and amici Maryland et al. argue that the procedural requirements simply establish minimum due process standards, something Mississippi appears already to provide, [34] and therefore may be upheld as an exercise of Congress' Fourteenth Amendment powers. We need not go that far, however, for we uphold the procedural requirements under the same analysis employed above in connection with the consideration provisions. If Congress can require a state administrative body to consider proposed regulations as a condition to its continued involvement in a pre-emptible field  and we hold today that it can  there is nothing unconstitutional about Congress' requiring certain procedural minima as that body goes about undertaking its tasks. The procedural requirements obviously do not compel the exercise of the State's sovereign powers, and do not purport to set standards to be followed in all areas of the state commission's endeavors. The judgment of the District Court is reversed. It is so ordered.