Jorling v. United States Department of Energy

218 F.3d 96, 2000 WL 702358
Court of Appeals for the Second Circuit·Decided May 31, 2000·No. Docket No. 99-6188·Published·Cited by 2 cases

Opinion

JON O. NEWMAN, Circuit Judge:

The issue on this appeal is whether certain hazardous waste regulatory charges imposed by New York on federal installations are “reasonable service charges” within the meaning of the provision of the Resource Conservation and Recovery Act that waives the sovereign immunity of the United States. See 42 U.S.C. § 6961(a) (1994). The United States Department of Energy and others (collectively “USDOE”) appeal from the June 3, 1999, judgment of the District Court for the Northern District of New York (Neal P. McCurn, District Judge), granting summary judgment to the New York State Department of Environmental Conservation and its commissioner (collectively “NYDEC”). The judgment imposed liability for hazardous waste regulatory charges assessed by NY-DEC against ten federal facilities in New York, and denied USDOE’s cross-motion for summary judgment. We conclude that the hazardous waste regulatory charges were properly determined to be “reasonable service charges,” and we therefore affirm.

Background

In January 1989, NYDEC brought four consolidated actions in New York State Supreme Court against USDOE to recover unpaid environmental program regulatory charges, including hazardous waste program and waste transporter program charges, assessed by the NYDEC against ten federal facilities from 1983 to 1989. USDOE counter-claimed for a refund of approximately $400,000 and related relief for regulatory charges already paid. These actions were subsequently removed to the District Court for the Northern District of New York.

The parties stipulated to the following relevant facts. At all relevant times, New York has had environmental conservation programs concerning waste pollution. In 1983, the New York legislature enacted and NYDEC began assessing hazardous waste program and waste transporter program charges, as detailed in N.Y. Envtl. Conserv. Law §§ 72-0402, 72-0502 (McKinney 1997 & Supp.2000). From 1983 through 1989, the ten federal facilities received billing for these waste regulatory charges in the month of billing, and payment was due under state statute within thirty days.

From 1983 through 1984, all waste regulatory charges were deposited into the state’s general revenue fund, which is primarily funded by tax revenues. From 1985 through 1988, half of the waste regulatory charges was deposited into the general revenue fund, and the other half was deposited into a special hazardous waste remedial fund (ie., the New York State superfund). Starting in 1989, half of the waste regulatory charges was deposited into the New York State superfund, and the other half was deposited into a special environmental enforcement fund.

The parties stipulated to the following charges and payments for waste regulatory charges from 1983 to 1989:

Year Charges Payments
1983 70,954.79 70,604.79
1984 112,833.56 112,833.56
1985 142,951.37 38,809.50
1986 227,870.28 24,000
1987 196,471.31_0
1988 197,250.00 0
1989 215,260.27 0

[99] NYDEC waived any claim for unpaid hazardous waste regulatory charges assessed prior to July 14, 1985. For the year 1985, NYDEC billed the annual regulatory charges in September 1985.

The District Court initially granted in part and denied in part cross-motions for summary judgment. See New York State Department of Environmental Conservation v. United States Department of Energy, 772 F.Supp. 91 (N.D.N.Y.1991) (“NYSDEC I”). The District Court explained that although section 6001 of the Resource Conservation and Recovery Act of 1976, Pub.L. No. 94-580, 90 Stat. 2795, 2821, as amended, 42 U.S.C. § 6961(a) (1994) (“RCRA”), contains a waiver of the United States’ sovereign immunity from suit concerning certain state requirements regarding hazardous waste, including the imposition of “reasonable service charges,” section 6001 is not a “blanket waiver[] of the United States’ sovereign immunity from the imposition and assessment of taxes by a State.” NYSDEC I, 772 F.Supp. at 98. The District Court noted that the “parties agree that the proper test for this court to utilize in ascertaining whether the charges sought by the NYDEC are impermissible taxes or permissible fees was developed by the Supreme Court in Massachusetts v. United States, 435 U.S. 444, 98 S.Ct. 1153, 55 L.Ed.2d 403 (1978),” NYSDEC I, 772 F.Supp. at 99, which we discuss infra.

Arguing that the waste regulatory charges were unreasonably high, USDOE asserted that in every year between 1983 and 1989, “total waste regulatory charges exceeded [NYDECj’s actual services [to the' ten federal facilities] by a ratio of approximately nine to one ($1,163,591.58 vs. $126,792.13).” Id.

The District Court denied both motions for summary judgment because neither party had submitted evidence “as to the value of the overall benefits the facilities receive in light of the programs and services made available to them by [NYDEC] should the need for such assistance ever arise.” Id. at 100.

On subsequent cross-motions for summary judgment, the District Court granted NYDEC’s motion for partial summary judgment and denied USDOE’s motion for summary judgment. See New York State Department of Environmental Conservation v. United States Department of Energy, 850 F.Supp. 132 (N.D.N.Y.1994) (“NYSDEC II”). The District Court explained that Massachusetts “requires only a rational relationship between the method used to calculate the fees and the benefits available to those who pay them.” Id. at 143 (emphasis added). The Court found such a relationship in this case because

larger facilities are more expensive to regulate and require more services than smaller facilities. In addition, all services which NYDEC provides pursuant to these regulatory programs, whether used or not, are available to the United States should they be needed in the future.... This evidence, coupled with the fact that the total receipts from these regulatory fees have been substantially less than the actual costs of these programs, demonstrates that NYDEC’s method of calculating its waste ... regulatory charges results in a fair approximation of the cost of the use of the system.

Id. (footnote omitted).

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Jorling v. United States Department of Energy, 218 F.3d 96, 2000 WL 702358 (2d Cir. 2000).

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