Opinion ID: 779823
Heading Depth: 3
Heading Rank: 2

Heading: Jurisdiction for Challenges to Implementation of the CO-94 Rate

Text: 32 Unsurprisingly, the parties dispute the date on which the BPA's implementation of the true-up to actuals became final. The BPA asserts that its implementation became final when it issued its June 4, 1998 letter responding to the Capacity Owners' final audit report. It argues that the letter was its final action because it included a comprehensive and unconditional denial of the Capacity Owners' claims without indicating that it would consider the issue further, and because the Capacity Owners had no right to demand further consideration under the Capacity Agreement. It further denies that its later March 24, 1999 letter responding to Puget Sound's demand for a refund under the Contract Disputes Act was the final action because that letter merely stated its position that the claim was not a contract claim to which the CDA applied. 8 33 Puget Sound counters that the March 24, 1999 letter was the final action in this dispute because the earlier letter was too ambiguous to give sufficient notice that the BPA had made a final determination. It also claims that it reasonably believed that its dispute was properly considered a contract dispute over the sale of personal property, and that it therefore could repackage its demand to the BPA as a certified claim brought pursuant to the CDA and require it to consider that claim anew before seeking judicial review in the Court of Federal Claims. 34 Although Section 7 of the Northwest Power Act permits an aggrieved party to challenge the implementation of final actions in the Ninth Circuit, it does not provide any agency specific standard as to what constitutes final action in this context. In considering when the BPA's denial of the Capacity Owner's challenge to its calculation of the true-up to actuals purchase price became final, we therefore turn for guidance to the more general doctrine of finality in administrative agency law. Fundamentally, that doctrine, is concerned with whether the initial decision-maker has arrived at a definitive position on the issue that inflicts an actual, concrete injury. Ma v. Reno, 114 F.3d 128, 130 (9th Cir.1997) (quoting Darby v. Cisneros, 509 U.S. 137, 144, 113 S.Ct. 2539, 125 L.Ed.2d 113 (1993)); see also Franklin v. Massachusetts, 505 U.S. 788, 797, 112 S.Ct. 2767, 120 L.Ed.2d 636 (1992) (The core question is whether the agency has completed its decisionmaking process, and whether the result of that process is one that will directly affect the parties.). Additionally, the Supreme Court has held in other contexts, as have we, that if an initial agency action may be modified or reversed during administrative reconsideration or review it is rendered non-final while such review is pending. See I.C.C. v. Bhd. of Locomotive Engineers, 482 U.S. 270, 284-85, 107 S.Ct. 2360, 96 L.Ed.2d 222 (1987); Acura v. Reich, 90 F.3d 1403, 1408-9 (9th Cir.1996). This rule is based on the consideration that it would waste scarce government resources to undertake parallel judicial review under such circumstances. Acura, 90 F.3d at 1407. The Supreme Court has similarly stated that, the relevant considerations in determining finality are whether the process of administrative decision making has reached a stage where judicial review will not disrupt the orderly process of adjudication. Port of Boston Marine Terminal Ass'n v. Rederiaktiebolaget Transatlantic, 400 U.S. 62, 71, 91 S.Ct. 203, 27 L.Ed.2d 203 (1970). Thus, in considering when the BPA's implementation of its rate in this case became final, we look for the date at which it communicated a definitive position that it would not grant a refund for spare parts or overhead and closed consideration of the issues. 35 Applying this practical test, we find that Puget Sound's petition was brought more than ninety days after the BPA's decision became final. Since federal law does not establish a formal procedure for the BPA to follow in implementing a rate, the parties themselves supplied a comprehensive and well-defined procedure for doing so in this case in the Capacity Agreement. 36 The Capacity Agreement specifies that the BPA was required to conduct the true-up to actuals and make any required price adjustment by distributing bills or refund vouchers to the Capacity Owners according to a specific timeline. According to Section 16 of the Capacity Agreement, once those vouchers were distributed, the Capacity Owners were permitted to perform a single audit of the BPA's books within 24 months. Once that audit was submitted to the BPA, Section 16 then required the BPA to respond within 30 days, either by agreeing with any exceptions claimed in the audit and remitting refund vouchers, or by disagreeing with such exceptions and proposing a resolution of the disagreement. If a committee representing all of the Capacity Owners agreed with the resolution, the BPA was required to remit refund vouchers for any additional refund proposed by it within the original 30-day period. If the committee did not agree, the Capacity Owners were then permitted to submit the dispute to non-binding arbitration pursuant to Sections 15 and 16 of the Capacity Agreement. 37 However, the right to arbitrate such as dispute was given to the representative committee only, not to the individual capacity owners, and it was of limited duration. If not exercised within eight months of the date that the audit began, the right was deemed waived. 9 At that point, the Capacity Agreement contemplated no further agency action, and the parties' only possible recourse was to the judicial system. On the other hand, if the Capacity Owners did submit a claim to nonbinding arbitration, the BPA was required to respond to the decision of the arbitrator within 90 days. Although the BPA could reject the decision of the arbitrator, it could only do so for a limited number of reasons specified in the Capacity Agreement. 38 With this as background, it is clear that the BPA took the final action required of it according to the process contemplated by both the BPA and Puget Sound itself on June 4, 1998. On May 7, 1998, the Capacity Owners transmitted a letter to the BPA demanding a refund and accompanied by the final audit report covering the true-up to actuals. The BPA's response letter was issued within thirty days, as required by the Capacity Agreement. At that point, the BPA had completed the steps of the agreed decision-making process and the Capacity Owners could choose whether to accept or reject its resolutions of the dispute (including a small refund for computer equipment). The Capacity owners accepted the BPA's proposal as to computer equipment but failed to respond as to the issues currently under petition. Since the deadline for taking a dispute to arbitration had already passed on May 15, 1998, the only recourse left to them was judicial. 39 Moreover, the contents of the BPA's letter responding to the final audit report were consistent with the parties' understanding that the BPA's action was its final action consistent with the procedure set up in the Capacity Agreement. Although the letter did not explicitly state that it was the BPA's final decision, it did contain an unambiguous and definitive rejection of the Capacity Owner's claims as to overhead and spare parts charges and denial of a refund. This was sufficient to inform the Capacity Owners that they had received the response to the audit required of the BPA. While the letter invited the Capacity Owners to contact a BPA official to answer any further questions regarding the response, and also asked them to inform it whether the committee accepted its resolution of the unrelated computer charge — as required by the Capacity Agreement before the BPA made any additional refund — it contained no indication that it would further consider the merits of the Capacity Owners' claims. 40 Further, we are not persuaded by Puget Sound's argument that its allegedly reasonable belief that the BPA was required to reconsider its true-up to actuals in response to a letter styled as a CDA claim is cause to consider May 19, 1999 the date at which implementation became final. As an initial matter, we note that Puget Sound's subjective belief is not apposite to the question of finality because our inquiry focuses on the point at which the BPA had taken a definitive position that was not actually subject to reconsideration and gave adequate notice of the fact to the Capacity Owners. See Ma, 114 F.3d at 130. Therefore, the question which Puget Sound properly raises centers on whether its belief was reasonable either because the BPA gave it cause to believe that it had not yet taken a definitive position or because the BPA was actually required to reconsider in response to a CDA claim. And the answer in both cases is no. 41 Puget Sound presents no evidence that the BPA had indicated willingness to undertake a redundant review of its claims after the process for finalizing the true-up to actuals contemplated in the Capacity Agreement was completed. Instead, Puget Sound contends that it reasonably came to the conclusion that the CDA applied to its claim. But mere reasonableness in this regard is of no avail because it is not apposite to the test outlined above. Even assuming that Puget Sound's legal conclusion was reasonable in the sense that it was colorable in light of prior case law, a mistaken legal belief that one can render an administrative decision non-final by requiring it to undertake additional administrative review is not apposite to the question whether the initial review was in fact final. 42 Finally, since Puget Sound presented a CDA claim for a refund of overhead and spare parts charges, we must determine whether the procedures and remedies provided by the CDA apply to Puget Sound's claims despite the fact that they challenge a rate implementation under our exclusive jurisdiction. We hold that they do not. In a variety of contexts, the Supreme Court has held that a remedy furnished by a precisely drawn and detailed statute preempts a more general remedy provided by statute. See Brown v. GSA, 425 U.S. 820, 832-34, 96 S.Ct. 1961, 48 L.Ed.2d 402 (1976); Preiser v. Rodriguez, 411 U.S. 475, 488-90, 93 S.Ct. 1827, 36 L.Ed.2d 439 (1973); United States v. Demko, 385 U.S. 149, 151-52, 87 S.Ct. 382, 17 L.Ed.2d 258 (1966); Stonite Prods. Co. v. Melvin Lloyd Co., 315 U.S. 561, 566-67, 62 S.Ct. 780, 86 L.Ed. 1026 (1942). For example, in Preiser, the Court expressly held that state prisoners could not seek redress for the loss of good-time credits under the Civil Rights Act, 42 U.S.C. § 1983, even though their complaint came within the literal terms of that statute because the federal habeas corpus statute, 28 U.S.C. § 2254, was the more specific act. Preiser, 411 U.S. at 489, 93 S.Ct. 1827. The Court stated that in amending the habeas corpus laws, Congress clearly required exhaustion of state remedies as a condition precedent to invocation of federal judicial relief, and it would frustrate Congressional intent to hold that claimants could evade this requirement through the expedient of putting a different label on their pleadings. Id. Similarly, in Brown, the Court held that Title VII provided the exclusive remedy for a federal employee who alleged race discrimination because: 43 The balance, completeness, and structural integrity of § 717 are inconsistent with the petitioner's contention that the judicial remedy afforded by § 717(c) was designed merely to supplement other putative judicial relief.... Under the petitioner's theory, by perverse operation of a type of Gresham's law, § 717, with its rigorous administrative exhaustion requirements and time limitations, would be driven out of currency were immediate access to the courts under other, less demanding statutes permissible. The crucial administrative role that each agency together with the Civil Service Commission was given by Congress in the eradication of employment discrimination would be eliminated by the simple expedient of putting a different label on (the) pleadings. Preiser v. Rodriguez, 411 U.S. 475, 489-490, 93 S.Ct. 1827, 1836, 36 L.Ed.2d 439, 450 (1973). It would require the suspension of disbelief to ascribe to Congress the design to allow its careful and thorough remedial scheme to be circumvented by artful pleading. 44 Brown, 425 U.S. at 832-33, 96 S.Ct. 1961. 45 As in the cases cited above, the CDA provides a general set of remedies — in this case for a variety of contract disputes involving federal agencies. By enacting the Northwest Power Act, Congress created a detailed framework which was more narrowly drawn to apply specifically to the BPA, and which created an integrated scheme of regulations and remedies. By its terms, that scheme is incompatible with the remedies afforded by the CDA. To highlight the type of conflict most salient to Puget Sound, the Northwest Power Act specifies the times that certain actions must be deemed final and thereby become subject to judicial review within ninety days. 16 U.S.C. § 839f(e)(1). Rate determinations, for example, are deemed final when approved by the FERC. 16 U.S.C. §§ 839e(i)(6), 839f(e)(1)(G). By contrast, under the CDA an executive agency's consideration of a contract related claim for greater than $100,000 may only be considered final and reviewable after a written certified claim meeting its requirements has been presented to the agency's contracting officer. See e.g., W.M. Schlosser Co. v. United States, 705 F.2d 1336, 1338 (Fed.Cir.1983); see also 41 U.S.C. § 605(a),(b). Were the CDA applicable, these two rules would come into direct conflict in a number of cases. For example, we have held that we have jurisdiction to consider claims challenging a rate-making as violating a prior contract entered into by the BPA. Jura, 876 F.2d at 746-48; see also Atlantic Richfield Co. v. Bonneville Power Administration, 818 F.2d 701, 705 (9th Cir.1987) (considering a breach of contract claim based on certain charges established through formal rate-making). Under the Act, a petitioner challenging such a rate would be required to seek judicial review within ninety days of its approval, while the CDA would permit it to file a claim with the BPA and then require it to wait for a response before petitioning the court. 46 Moreover, this conflict is not an accident; it reflects the fact that the Northwest Power Act was enacted by Congress for reasons with which the procedures of the CDA are incompatible. This court has recognized that an important goal of Congress in enacting the Northwest Power Act was to expedite litigation challenging BPA actions. See Pacific Power & Light Co., 795 F.2d at 815; see also H.R.REP. No. 96-976 (Part II) 30-31 (1980). It thus provides for direct review to the Ninth Circuit and establishes a short limitations period. By contrast, the CDA provides for a much more relaxed time frame. See e.g. 41 U.S.C. § 605(a) (providing a six-year limitations period for raising CDA claims with an executive agency). Were a petitioner permitted to invoke the CDA for a claim subject to our review, and thereby render a final decision non-final, the effect would be to extend the life of the dispute by as much as six years. In short, allowing Puget Sound to insert the CDA limitations period into the Northwest Power Act by attempting to contract around the latter's procedures would frustrate Congressional purpose. 47 We thus hold that the procedures provided by the CDA were not applicable in this context. The BPA's implementation of Schedule CO-94 through the true-up to actuals was final as of June 4, 1998. Because Puget Sound's petition was brought more than 90 days after this date we lack jurisdiction to consider it.