FLOOD06374

• County: Gunnison
• Community: Uncompahgre Valley
• Basin: Gunnison
• Title: Uncompahgre Valley Water Users Association
• Date: 1/1/1984
• Prepared By: CWCB
• Floodplain - Doc Type: Data ‎(general)‎

Project No. 4024-001, et al.

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of the order or alternatively, reconsideration and clarification; ~I
on October 21, Gregory wilcox ("Wilcox") filed an application for
rehearing and clarification of the order; on December 8, Uncom-
pahgre filed an offer of settlement; on December 27, Energenics
filed in opposition to the settlement offer; and on January 5, 1984,
Uncompahgre filed in response to Energenics' opposition. ~/

We now turn to the arguments and questions raised in these
pleadings.

III. DISCUSSION

Uncompahgre advances four arguments contesting our Sep-
tember 21 order. 10/ First, uncompahgre claims that the Commis-
sion abused its dlScretion by implementing the rebuttable pre-

ll/

Concurrent with this filing, Uncompahgre -- on the next to
the last day of the 30 day period provided to rebut the
presumption -- asked that the Commission grant a stay of
its September 21 order pending Commission action on its
other request. Our decision here renders Uncompahgre's
request moot.

~I

We have determined that settlement of this matter is not
appropriate. The integrity of our competitive licensing
program under the ~ederal Power Act requires the action we
take herein.

lQ/

In our Order on Abuse, we gave Uncompahgre 30 days to
demonstrate the absence of concerted action with the
City of Montrose ("City"). Uncompahgre has filed its
response, admitting that, while there was a planned
arrangement with the City to use its preference to
obtain the sites, such arrangement grew out of its
"historically close ties" with the City. uncomphagre
also points to the fact that the relationship of
which the Commission was aware, occurred prior to the
Fayetteville decision. (Uncompahgre's petition, pp.
8-14.) Uncompahgre further states that it tried to
"abide by the spirit" of the Fayetteville decision,
but that the opposing "control" requirements, specified
by the Commission and the Internal Revenue Service
affecting the financial and economic viability of the
project prevented it, and caused the City to surrender
its permit. (rd. at pp. 15-20). As we noted in our
Order on Abuse, the motives underlying any such arrange-
ment are not at issue. Municipal and non-municipal
(Footnote continued on next page.)

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Project No. 4024-001, et-al.

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sumption procedure. Second, Uncompahgre argues that the Commis-
sion's decision was arbitrary and capricious because of its
retroactive application. Third, Uncompahgre urges that the
Commission erred in the selection of its remedy. Finally,
Uncompahgre asserts that the Commission's decision was procedur-
ally defective.

A. Uncompahgre argues that the Commission abused its discretion
by failing to adopt the rebuttable presumption procedure pur-
suant to rulemaking procedures,

.

In the case of Uncompahgre, we found on the facts before
us that there was an apparent abuse of municipal preference
by the coordinated permit surrender by the City of Montrose
and the simultaneous filing of license applications by Uncom-
pahgre. Uncompahgre was given 30 days to show cause why it
should not be found to have abused municipal preference. Its
failure to do so, we explained, would result in the dismissal
of its license applications and its being precluded for one
year from competing for authority to develop those sites.

Our action vis a vis Uncompahgre was eminently fair and a
proper exercise ~our-authority to implement the provisions of
the Federal Power Act in case-by-case adjudication. It is a
fundamental principle of administrative law that an agency has
the discretion to choose between proceeding by general rule or
adjudication. 11/ Had we delayed implementation of this procedure,
our competitive-process would have been undermined. Furthermore,
abuse of municipal preference can be manifested in such a wide
variety of situations that it would not be useful or appropriate
to attempt to anticipate all such actions in a rulemaking. Our
decision is in accord with the ruling in SEC v. Chenery, 332
u.s. 194, 202-203 (1947), where the court explained:

(Footnote continued from previous page).
competitors alike are injured by this abuse of preference,
whether or not the abusing municipality and its non-
municipal partner proceeded in knowing violation of
Fayetteville or according to what they thought to be
"good faith". All that is required for a finding of
abuse is that the municipal preference was employed in
an impermissible manner so as to place the non-municipal
applicant in an advantageous position. Uncompahgre was
given 30 days to respond to our finding in order to
insure that we were not proceeding under some misconcep-
tion with respect to the facts in this proceeding. Uncom-
pahgre has presented no argument disputing our interpreta-
tion of the facts in this case.

.

!.v

See SEe v. Chenery Corp., 332 U.S. 194 (1947); NLRB v. Bell
Aerospace Co., 416 U.S. 267 (1974).

,.,

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