[00:00:00] Speaker 00:
Very well.

[00:00:00] Speaker 00:
Please proceed.

[00:00:02] Speaker 04:
Thank you, Your Honor.

[00:00:02] Speaker 04:
May it please the Court?

[00:00:03] Speaker 00:
Doing both cases, right?

[00:00:04] Speaker 04:
Yes, Your Honor.

[00:00:05] Speaker 04:
I'm doing both.

[00:00:06] Speaker 04:
May it please the Court?

[00:00:07] Speaker 04:
Andrew Missal on behalf of petitioners in these cases.

[00:00:10] Speaker 04:
I'm going to try to reserve five minutes for rebuttal, but I will watch my time.

[00:00:15] Speaker 04:
The central question in these cases concerns the meaning of Section 4H11 of the Northwest Power Act.

[00:00:21] Speaker 04:
Under a proper interpretation of the statute, Section 4H11 applied to the decisions at issue here.

[00:00:27] Speaker 04:
BPA's contrary interpretation is incorrect.

[00:00:30] Speaker 04:
It renders a key term in Section 4-H-11, surplusage.

[00:00:33] Speaker 04:
It makes parts of the Northwest Power and Conservation Council's Fish and Wildlife Program ineffectual, and it undermines the comprehensive approach to fish and wildlife protection adopted in the Northwest Power Act.

[00:00:45] Speaker 00:
Let me ask you this.

[00:00:45] Speaker 00:
If I understand your contention properly, 4-H-11A reaches financial decisions like the ones here.

[00:00:54] Speaker 00:
If that's the case, then doesn't that render 4-H-10A superfluous?

[00:01:00] Speaker 04:
No, Your Honor, 4H10A and 4H11 are very different.

[00:01:04] Speaker 04:
So for one thing, 4H10 is primarily a power-granting provision.

[00:01:09] Speaker 04:
So before the Northwest Power Act, BPA lacked explicit authority to use its power to benefit fish and wildlife.

[00:01:17] Speaker 04:
That was not true of the Corps and Reclamation, the Bureau of Reclamation, because the dam authorizing statutes, for most of those dams, fish and wildlife has an authorized purpose.

[00:01:26] Speaker 04:
So section 4H10 says to BPA, okay, you have the power to use your authority to benefit fish and wildlife.

[00:01:34] Speaker 04:
It does then have this consistency provision, but the consistency provision says you must act consistent with the fish and wildlife program, the power plan, the statutes.

[00:01:44] Speaker 04:
It doesn't have a lot of teeth in it.

[00:01:46] Speaker 04:
Section 4H11

[00:01:47] Speaker 04:
is the provision where Congress puts the teeth into the fish and wildlife provisions.

[00:01:52] Speaker 04:
That's where Congress says, okay, we've taken this comprehensive approach to fish and wildlife as evidenced by the earlier parts of Section 4-H, 4-H2, 4-H5, 4-H8, that all say, okay, we need to do operational changes and we need to do offsite mitigation.

[00:02:08] Speaker 00:
Okay, so let's just say you were one of us and say we had to write an opinion

[00:02:13] Speaker 00:
as to the scope of 4H11A.

[00:02:15] Speaker 00:
What would you say?

[00:02:17] Speaker 00:
What does 4H11A cover?

[00:02:20] Speaker 04:
I think that it covers decisions, it covers BPA's decisions about mitigation funding because

[00:02:30] Speaker 04:
BPA's mitigation funding is how it implements offsite mitigation.

[00:02:35] Speaker 04:
The Northwest Power Act didn't contemplate that BPA would become a fish and wildlife agency.

[00:02:40] Speaker 04:
It contemplated that BPA would fund efforts by the states, by tribes, and even by private entities to carry out fish and wildlife mitigation.

[00:02:48] Speaker 04:
So I think the opinion would say when BPA makes decisions about how much money it's going to

[00:02:55] Speaker 04:
allocate to these fish and wildlife mitigation efforts, that is a decision that falls within the scope of 4H11.

[00:03:03] Speaker 02:
But then, doesn't that introduce, I mean, there are some inconsistencies between 10 and 11 that seem like they are a problem for that interpretation.

[00:03:15] Speaker 02:
So for example, 10 says, 10A says, they're supposed to protect, mitigate, and enhance fish and wildlife to the extent affected by development.

[00:03:26] Speaker 02:
And 11 says, in a manner that provides equitable treatment.

[00:03:32] Speaker 02:
They're either the same or they're different.

[00:03:34] Speaker 02:
They seem like they're different, and then what happens if you're right and 11 also applies?

[00:03:40] Speaker 04:
So, Your Honor, I don't think that they're in conflict at all because I think 4H10 tells BPA you're allowed to use your authorities to protect, mitigate, and enhance fish and wildlife to the extent affected by hydroelectric facilities.

[00:03:53] Speaker 04:
In other words, it's saying you can't do this

[00:03:56] Speaker 04:
You're not supposed to use this authority just for fish and wildlife in general.

[00:04:00] Speaker 04:
It's specifically for fish and wildlife affected by hydroelectric facilities.

[00:04:04] Speaker 04:
And the council has recognized this and said that there needs to be a nexus for measures in the program.

[00:04:09] Speaker 04:
There needs to be a nexus between those measures and the hydroelectric system.

[00:04:13] Speaker 04:
4H11 says when you're exercising these responsibilities, BPA and all the other agencies, here's how you do it.

[00:04:20] Speaker 04:
You do it in a way that puts FISH and other statutory purposes on equal footing.

[00:04:26] Speaker 04:
So I think there's no inconsistency between those two provisions.

[00:04:29] Speaker 04:
And in fact, BPA concedes that its power marketing activities fall under 4H11A.

[00:04:35] Speaker 04:
Well, those also fall under 4H10.

[00:04:38] Speaker 04:
Because 4-H-10 says you can use the fund and all your other authorities, but you must do so in a manner consistent with, et cetera, the program, et cetera, et cetera.

[00:04:47] Speaker 04:
So already BPA is conducting activities, financial activities, that are subject both to 4-H-11 and 4-H-10.

[00:04:54] Speaker 02:
And what about further down in both provisions?

[00:04:59] Speaker 02:
Under 10, it's supposed to be in a manner consistent with the plan and the program adopted by the council.

[00:05:08] Speaker 02:
And under 11, it's supposed to be taking into account to the fullest extent practicable the program adopted by the council.

[00:05:15] Speaker 02:
Those do seem different, right?

[00:05:17] Speaker 02:
Or at least one is significantly stronger than the other, right?

[00:05:22] Speaker 04:
Your honor, I think the key difference for me between those is that one's procedural and one's substantive.

[00:05:28] Speaker 04:
So 4H10 is substantive.

[00:05:30] Speaker 04:
It says you have to act in a manner consistent with the program and all of these other things.

[00:05:35] Speaker 04:
4H11A sub 2 says you have to take into account the council's program to the fullest extent practicable.

[00:05:42] Speaker 04:
So Congress sometimes imposes both substantive and

[00:05:46] Speaker 04:
procedural requirements for the same actions.

[00:05:48] Speaker 02:
So you read 11 as purely procedural, so they could take into account the program by saying, well, we've thought about the program and decided to do none of it.

[00:05:58] Speaker 02:
That would be taking it into account?

[00:06:00] Speaker 04:
I think they would have to justify that decision, and then we'd, of course, have a question of whether it was arbitrary and capricious.

[00:06:06] Speaker 04:
And I think it would be difficult for them

[00:06:10] Speaker 04:
justify a decision to do something that was completely against the program under Section A2.

[00:06:17] Speaker 04:
But I do think that A2, the fullest extent practicable and the consistency are not incompatible.

[00:06:23] Speaker 04:
They're just one substantive, one's procedural.

[00:06:27] Speaker 00:
Again, you think that 10 is substantive

[00:06:32] Speaker 00:
and 11 is procedural or the other way?

[00:06:34] Speaker 04:
Sorry, let me be clear.

[00:06:36] Speaker 04:
So the consistency provision of 10 is substantive.

[00:06:41] Speaker 04:
The fullest extent practicable taking the council's program into account is procedural.

[00:06:46] Speaker 04:
Equitable treatment is substantive, however.

[00:06:48] Speaker 04:
That's a substantive requirement.

[00:06:49] Speaker 04:
In fact, it is the most important substantive requirement for fish and wildlife in the act.

[00:06:53] Speaker 00:
What if we think both sections are substantive?

[00:06:56] Speaker 00:
What impact does that have on your argument?

[00:07:00] Speaker 04:
Well, Your Honor,

[00:07:01] Speaker 04:
I don't think it has an impact because I don't think the two are in tension in any way.

[00:07:07] Speaker 04:
I think that, again, BPA already conducts activities that are subject to both of those subsections.

[00:07:15] Speaker 04:
And there's no problem with that.

[00:07:17] Speaker 04:
The subsections serve different purposes.

[00:07:19] Speaker 04:
4-H-10 is where BPA has granted the power to use its authority for fish and wildlife.

[00:07:26] Speaker 04:
4-H-11 is where Congress says to BPA and the other agencies, here's how you do it.

[00:07:30] Speaker 02:
So why isn't, I mean, the mode of analysis in last year's Idaho Conservation League case was to say, we have this, we have 11, which I think I would agree with you, just read in a vacuum, it's broad enough to cover this.

[00:07:46] Speaker 02:
Managing, I think, seems like this falls under the rubric of managing, or it could if you read that in isolation.

[00:07:55] Speaker 02:
We also have this other more specific statute that seems directed to this particular problem.

[00:08:02] Speaker 02:
There was seven, here it's 10.

[00:08:05] Speaker 02:
And so we should infer from that that Congress didn't mean 11 to apply to this.

[00:08:11] Speaker 02:
That's essentially what they said there.

[00:08:13] Speaker 02:
Why isn't that suggestive of what we ought to do here?

[00:08:17] Speaker 04:
So I think the one big difference is that when you compare Section 7 to Section 4H10, those are very different beasts.

[00:08:26] Speaker 04:
Section 7 is a very long, complex, reticulated scheme telling BPA how to conduct rate-making proceedings.

[00:08:36] Speaker 04:
It has procedural requirements.

[00:08:37] Speaker 04:
It has substantive requirements.

[00:08:40] Speaker 04:
The inference that the panel made in the previous decision was, look, this is so

[00:08:46] Speaker 04:
complicated and this is so detailed that if Congress wanted 4-H-11 to apply, they would have said so.

[00:08:52] Speaker 04:
4-H-10 is not in any way close to being as detailed, and the part of it that's the most detailed is 4-H-10D, but that was not in the statute as originally enacted in 1980.

[00:09:05] Speaker 04:
And it applies to the council.

[00:09:07] Speaker 04:
And in fact, I would argue that 4-H-10-D actually cuts in our favor, because 4-H-10-D is this long, complicated thing about how the council will select measures to put into the program, which just evinces how important the program was to Congress.

[00:09:24] Speaker 04:
And the idea that

[00:09:27] Speaker 04:
The most important decisions that affect the implementation of the program, namely BPA's financial decisions, would then be exempted from 4-H-11.

[00:09:35] Speaker 04:
Doesn't make a lot of sense.

[00:09:36] Speaker 00:
Let me ask you this.

[00:09:38] Speaker 00:
What's your best argument that the RDC's allocation decision, I mean the BPA's ROC allocation is a qualifying, end quotes, responsibility?

[00:09:51] Speaker 00:
Sorry.

[00:09:51] Speaker 00:
Your best argument.

[00:09:53] Speaker 00:
that the BPA's RDC allocation is a qualifying and quotes responsibility under the statute.

[00:10:00] Speaker 04:
Our best argument is that.

[00:10:03] Speaker 04:
BPA's duty under the Northwest Power Act, one of its duties is to use the BPA fund to protect, mitigate, and enhance fish and wildlife.

[00:10:11] Speaker 04:
That's part of, that's what it does with respect to managing the hydro system, because it is not the operator in fact of the hydro system, that's the core and reclamation.

[00:10:20] Speaker 04:
And so BPA's mitigation funding duties are part of its managerial responsibility that falls under 4-H-11.

[00:10:31] Speaker 03:
Yeah, that was my question.

[00:10:32] Speaker 03:
Could you explain textually how you get to rate determinations and funding decisions under 11A?

[00:10:37] Speaker 03:
Is it, you think you're using managing as the hook?

[00:10:42] Speaker 04:
Yes, Your Honor.

[00:10:43] Speaker 04:
We think that, especially in light of operating already, we know what operating means.

[00:10:47] Speaker 04:
It's used in the other statutes.

[00:10:49] Speaker 04:
So we think that by managing, Congress was trying to cast a very wide net and essentially bring in all of these agencies relevant response.

[00:10:57] Speaker 03:
But it's managing hydroelectric facilities, right?

[00:11:00] Speaker 04:
Yes.

[00:11:01] Speaker 03:
And then so how do you get from there to funding determinations?

[00:11:05] Speaker 04:
So I think, especially with REDD next to operating, managing the hydro system can include funding efforts to, given that BPA's statutory duty is to protect, mitigate, and enhance fish and wildlife to the extent affected by the hydro system, managing the hydro system can include funding measures, can include funding those mitigation measures.

[00:11:27] Speaker 04:
So the idea would be that, and again, BPA already concedes that when it makes short-term power purchases for the benefit of fish and wildlife, that that's, well, they don't actually really ever say that it's managed.

[00:11:43] Speaker 04:
They say something, maybe it's operating, maybe it's managing, but they say it falls under 4H11.

[00:11:47] Speaker 04:
And I would say if that falls under 4H11, I mean, when BPA-

[00:11:50] Speaker 03:
goes directly to the management of operation of the facilities.

[00:11:55] Speaker 03:
My understanding is when there's a shortfall, that's when they buy it.

[00:11:59] Speaker 03:
So that goes directly to operating the electric grid, essentially.

[00:12:06] Speaker 04:
Yes, although they're, of course, they're managed.

[00:12:10] Speaker 03:
I guess my point is it just seems, setting these rate determinations seems so far more removed from operating or managing a facility.

[00:12:20] Speaker 04:
So two points to that.

[00:12:22] Speaker 04:
I think first, this is technically, it's related to the rate determination, but it is not itself a rate determination.

[00:12:28] Speaker 03:
But the second point I would say is- It makes it even further far afield, is my point.

[00:12:33] Speaker 03:
Well, I think- Because it's like rate determination, and then the excess, and then use of the excess.

[00:12:40] Speaker 04:
So I think there's still, but there still is a nexus, there still is a close relationship to the Hydra system, because of course, the only reason BPA is funding

[00:12:50] Speaker 04:
mitigation is to protect fish from the effects of the hydro system.

[00:12:55] Speaker 04:
And in fact, that limits BPA's authority to spend money under 4H10.

[00:13:00] Speaker 04:
So there's still a connection to the hydro system.

[00:13:02] Speaker 04:
Now if the point is, well, is there as tight a connection to the hydro system there?

[00:13:06] Speaker 04:
No, but I don't think, I think when you read the term, I think when you read the term managing, it can encompass both, and it is a better reading of the statute to say that it encompasses both.

[00:13:18] Speaker 03:
Just as a practical matter, is it the same people managing or operating the facility and then setting the rate distribution?

[00:13:29] Speaker 03:
I'm sorry?

[00:13:31] Speaker 03:
Is it the same people managing the facility and determining the rate distribution, the excess distribution?

[00:13:39] Speaker 04:
Well, I mean, it's BP.

[00:13:40] Speaker 04:
I think BPAs.

[00:13:45] Speaker 04:
Financial, I think BPA's decisions about how much to fund mitigation is part of its managing of the Hydra system.

[00:13:52] Speaker 04:
I'm not sure if I answered.

[00:13:53] Speaker 03:
It's the same people, I think that's what I thought.

[00:13:54] Speaker 03:
Yeah, I'm just trying to think, is it actually the same people?

[00:13:58] Speaker 03:
Is there someone doing the managing of the facility?

[00:14:01] Speaker 03:
Is there someone then determining rate funding?

[00:14:03] Speaker 04:
I don't pretend to know exactly how BPA operates on the inside, but my understanding is that the, I am sure some of the same people are involved.

[00:14:15] Speaker 00:
Did you want to save some time?

[00:14:17] Speaker 04:
It's entirely up to you, but... Yeah, I will reserve the rest of my time.

[00:14:21] Speaker 00:
Very well.

[00:14:23] Speaker 04:
Okay.

[00:14:25] Speaker 00:
Drawl it.

[00:14:44] Speaker 01:
Good morning.

[00:14:45] Speaker 01:
Morning.

[00:14:46] Speaker 01:
May it please the court, my name is Courtney Olive, representing respondent Bonneville Power Administration, and with me at council table is Mr. Tucker Miles of Bonneville's Office of General Counsel.

[00:14:57] Speaker 01:
BPA and petitioners agree that the RDC decisions before you today were purely financial in nature.

[00:15:05] Speaker 01:
The question is whether Section 4H11A of the Northwest Power Act applies to financial decisions like these.

[00:15:12] Speaker 01:
It does not.

[00:15:13] Speaker 01:
That provision pertains to how water is managed within a system of dams and reservoirs.

[00:15:20] Speaker 01:
And the RDCs did not involve water management.

[00:15:24] Speaker 01:
Yet petitioners seek to, in Mr. Mistel's words and in the words of his brief, broaden Section 4H11A so that it would apply for the first time in 44 years to BPA's financial decisions.

[00:15:38] Speaker 01:
We ask the court to reject this broad reading

[00:15:41] Speaker 01:
And I'd like to go directly into the merits to explain why.

[00:15:44] Speaker 01:
I'll address our jurisdictional arguments at the end if there's time.

[00:15:50] Speaker 01:
This case really boils down to and is most directly addressed with the plain language of the provision here, Section 4H11A.

[00:16:00] Speaker 01:
Petitioners have conceded through their briefing that read on its own, the text of 4H11A could carry the meaning that BPA ascribes to it.

[00:16:08] Speaker 01:
But they're insisting that this is a situation where the provision itself does not tell us where it should apply, but we must impute a broad reading to, as Judge Boumete observed, one word, the word management.

[00:16:22] Speaker 01:
And so if you want to join me, I'm on page 28 of our brief, so that's where the provision appears.

[00:16:27] Speaker 01:
You may have it in front of you and elsewhere, but I'm just going to focus on a few lines of the provision to talk about how the word management

[00:16:36] Speaker 01:
is limited by the phrase in which it appears.

[00:16:39] Speaker 01:
And of course, this is the problem with Petitioner's whole case.

[00:16:42] Speaker 01:
I mean, in analyzing statutory text, we do not look at its words in isolation.

[00:16:47] Speaker 01:
That's the court's B.F.

[00:16:48] Speaker 01:
Goodrich case.

[00:16:49] Speaker 01:
General Dynamics from the Supreme Court says, a phrase gathers meaning from the words around it.

[00:16:54] Speaker 01:
These are basics of statutory interpretation.

[00:16:57] Speaker 01:
But Mr. Missal is not adhering to these.

[00:16:59] Speaker 01:
So what is happening in 4H11A?

[00:17:03] Speaker 01:
And I recognize that it's lengthy.

[00:17:06] Speaker 01:
But it sets up a situation where we're talking about the physical management of these facilities.

[00:17:13] Speaker 01:
It directs the administrator and these other agencies to manage and operate the hydroelectric facilities located on the Columbia River.

[00:17:22] Speaker 01:
And then in Romanette 1, the last three lines, and this is where equitable treatment appears, when you're managing and operating those hydro facilities, you have to do it, quote, in a manner that provides equitable treatment for such fish and wildlife with the other purposes for which such system and facilities are managed and operated.

[00:17:44] Speaker 01:
Now, what are these purposes?

[00:17:45] Speaker 01:
They're all water management purposes.

[00:17:48] Speaker 01:
Congress specifically authorized the construction of these dams for things like flood control, irrigation for crops, navigation, power generation.

[00:17:57] Speaker 01:
All of these things have to do with the fundamental attribute of the dams and the reservoirs.

[00:18:01] Speaker 03:
Where are you getting the other purposes from?

[00:18:03] Speaker 03:
Is that statutorily provided?

[00:18:05] Speaker 01:
Yes, Your Honor.

[00:18:06] Speaker 01:
So it's in Romanette 1 of 4H11A, it's the second to last line of that paragraph.

[00:18:14] Speaker 01:
It says,

[00:18:15] Speaker 01:
provide equitable treatment for fish and wildlife.

[00:18:20] Speaker 03:
No, I'm saying how are you defining the other purposes?

[00:18:22] Speaker 01:
Oh, excuse me.

[00:18:23] Speaker 01:
Yes, yes.

[00:18:24] Speaker 01:
Those other purposes are statutorily defined.

[00:18:28] Speaker 01:
When Congress authorized in the 30s, 40s, and 50s the construction of these dams, it listed specific purposes.

[00:18:35] Speaker 03:
Do you have a statutory site off the top of your head?

[00:18:37] Speaker 01:
Yes.

[00:18:47] Speaker 01:
I don't have it at my fingertips, Your Honor.

[00:18:50] Speaker 01:
I apologize, Judge.

[00:18:51] Speaker 01:
Your colleague might have it.

[00:18:52] Speaker 01:
My colleague has it here.

[00:18:54] Speaker 01:
Thank you.

[00:18:54] Speaker 01:
Okay, so you can find that in the excerpt of record.

[00:18:58] Speaker 01:
It's volume 3ER at 443.

[00:19:01] Speaker 01:
Okay, thank you.

[00:19:03] Speaker 01:
And so again, those are all water management purposes.

[00:19:06] Speaker 01:
So we're talking about a provision that Congress designed as a tool for how we protect, mitigate, and enhance fish when we're operating the system and making

[00:19:16] Speaker 01:
You know, inevitable competing decisions on how you use the water.

[00:19:20] Speaker 00:
Let's assume, arguing that we agree with your construction of 4H11A.

[00:19:27] Speaker 00:
What role then does 4H10A play?

[00:19:31] Speaker 01:
Well, 4H10 plays the funding role.

[00:19:35] Speaker 01:
So separate from the physical operation of the system, Congress also designed a separate tool to deal with financial BPA decisions on how to protect, mitigate, and enhance.

[00:19:47] Speaker 01:
And that's 4H10.

[00:19:49] Speaker 01:
In fact, I think it was Judge Miller's questions that were going to this, but 4H10,

[00:19:56] Speaker 01:
is a separate paragraph from Section 4H11.

[00:20:01] Speaker 01:
And it specifically says that BPA's funding is pursuant to this paragraph.

[00:20:06] Speaker 01:
So it's TIN that deals with financial decisions and how BPA is to protect, mitigate, and enhance with regard to paying for offsite mitigation.

[00:20:15] Speaker 01:
Essentially, Congress, just practically speaking, Congress knew that the dams could only do so much with the water management decisions.

[00:20:23] Speaker 01:
And so they assigned BPA a separate tool to go out and fund mitigation projects.

[00:20:28] Speaker 01:
And the problem that petitioners are doing here is they're collapsing the provisions into one.

[00:20:33] Speaker 01:
They're saying, look, you can only meet 4H10 if you fund projects in an equitable manner.

[00:20:40] Speaker 01:
They're grabbing that equitable standard from over in 4H11A and saying, well, 4H10 must mean that you've got to fund in an equitable manner.

[00:20:49] Speaker 01:
But no, they're entirely separate statutory provisions dealing with separate situations.

[00:20:54] Speaker 00:
From your perspective, 11 has nothing to do with the funding.

[00:20:57] Speaker 00:
It's all in 10.

[00:20:58] Speaker 01:
That's correct.

[00:21:00] Speaker 02:
Can I go back to what you were saying a minute ago about the other purposes in 11A, the lie?

[00:21:10] Speaker 02:
And so I think you're saying that those are all physical management purposes.

[00:21:17] Speaker 02:
That's correct.

[00:21:17] Speaker 02:
So what about, I think it's section two of the Northwest Power Act, or 16 U.S.C.

[00:21:25] Speaker 02:
839, that's the congressional declaration of purpose.

[00:21:28] Speaker 02:
Is that the relevant?

[00:21:31] Speaker 02:
No.

[00:21:31] Speaker 01:
That's not the relevant version.

[00:21:33] Speaker 01:
Of course it's an overarching purpose of the Northwest Power Act to help

[00:21:38] Speaker 01:
benefit fish and wildlife and protect, mitigate, and enhance them.

[00:21:42] Speaker 01:
In this provision, it is a term of art.

[00:21:46] Speaker 01:
It is in reference to the other congressionally authorized purposes for which the dams were constructed.

[00:21:55] Speaker 01:
So, if you will, this 4H11A is a balancing test.

[00:22:02] Speaker 01:
Congress wanted us to put fish on level footing when we're making decisions with what to do with the water.

[00:22:07] Speaker 01:
Do we, for example, do we spill it over the top of the dams so that fish can pass more easily on their migration to the ocean, or do we use it to generate power and run it through the turbines in the dams?

[00:22:19] Speaker 01:
Treat fish equitably when you're making those types of water management decisions.

[00:22:24] Speaker 01:
Do you hold extra water back so you can irrigate for crops, or do you allow more to pass through the dams for fish?

[00:22:32] Speaker 01:
So you're just balancing.

[00:22:33] Speaker 00:
It's a balance.

[00:22:34] Speaker 00:
From BPA's perspective, I'm oversimplifying here.

[00:22:36] Speaker 00:
11 is all about water.

[00:22:39] Speaker 00:
10 is all about allocation of money.

[00:22:42] Speaker 01:
That is correct, Your Honor.

[00:22:45] Speaker 01:
And 10, I heard Mr. Missal discuss that, well, you can't really apply the ICL-1 reasoning because there, the court said, well, the standard at play was very, very specific.

[00:22:56] Speaker 01:
The rate setting, Section 7 standard

[00:22:58] Speaker 01:
Well, I disagree.

[00:23:01] Speaker 01:
The logic can easily be applied from your prior ICL-1 case here.

[00:23:05] Speaker 01:
10 is plenty specific about funding decisions.

[00:23:10] Speaker 01:
I mean, it has various standards and things that we're supposed to follow.

[00:23:20] Speaker 01:
And so the idea that, well,

[00:23:24] Speaker 01:
Congress really meant for equitable treatment to apply over in 10, even though it didn't say that, and it also meant for funding to apply over in 11.

[00:23:32] Speaker 01:
I mean, that just doesn't make sense.

[00:23:35] Speaker 01:
10 is plenty specific to tell us how to fund, and we follow that.

[00:23:38] Speaker 01:
And as one of your honors, again, I think it was Judge Miller, pointed out, there are separate standards in 10 that govern the funding.

[00:23:47] Speaker 01:
It must be consistent with the council's program than where the council's program comes up in 11.

[00:23:54] Speaker 01:
The standard there is just taken into account to the fullest extent practical.

[00:23:58] Speaker 01:
So we do that.

[00:24:00] Speaker 03:
The council's program has... Council, can I ask, just looking at 11, is there any other textual reason that we should limit management to physical management of the facilities aside from the other purposes provision?

[00:24:14] Speaker 01:
Absolutely there is a textual reason.

[00:24:16] Speaker 01:
So Arizona health care case from this court in 2007, quote, Congress intends a different meaning when it uses different words in connection with the same subject.

[00:24:27] Speaker 01:
So the subject in 10 and 11 is.

[00:24:30] Speaker 02:
I think the question was if we were just looking at 11.

[00:24:32] Speaker 02:
Just looking at 11.

[00:24:33] Speaker 01:
Oh, I'm sorry.

[00:24:33] Speaker 01:
Yeah, just in isolation.

[00:24:35] Speaker 01:
OK.

[00:24:38] Speaker 01:
Well, the textual reason is that it first off sets up

[00:24:44] Speaker 01:
the verbs, managing and operating, acting on what?

[00:24:49] Speaker 01:
Acting on the noun hydroelectric facilities located in the Columbia River.

[00:24:55] Speaker 01:
And then it repeats that textual language down in the equitable treatment provision where it says, manage and operate, quote, in a manner that provides equitable treatment for such fish and wildlife with the other purposes for which such system and facilities are managed and operated.

[00:25:11] Speaker 01:
So again, it's equitable treatment linked to

[00:25:14] Speaker 01:
them it's the other purposes the other purpose yet so there's no other actual reason to limit management as you know i think that's the that that's our prime argument on okay yes your honor but but it's you know it's supported by canons of statutory construction and and if i could just kind of finish the the point on the you know uh... congress means different things when uses different words in connection with the same subject well yes four h ten and four h eleven both deal with

[00:25:42] Speaker 01:
protecting, mitigating, and enhancing fish and wildlife.

[00:25:46] Speaker 01:
But 10 uses very different words.

[00:25:48] Speaker 01:
It says go out and fund things, things that, you know, the dams through their capabilities of regulating water, they couldn't go out and fund, you know, building of a fish hatchery or restoring a stream somewhere.

[00:26:00] Speaker 01:
Congress wanted us to do that too, and it gave us funding provisions for how to do that.

[00:26:05] Speaker 01:
And then 11 separately says protect, mitigate, and enhance when you're making water management decisions on running the river.

[00:26:12] Speaker 01:
So I want to just add, if you need confirmation of this reading, you don't have to look any further than the legislative history and the purpose of what was going on.

[00:26:22] Speaker 01:
We've got a lot about this in our briefs about what Congress was trying to remedy with 4-H-11 and the water flow problems that had existed where previously fish had only been given under a prior statute equitable consideration.

[00:26:35] Speaker 01:
So equitable treatment was upping the ante when you're dealing with water flow situations.

[00:26:41] Speaker 01:
Okay, vis-a-vis the other balancing purchases for which you're using the system and facilities.

[00:26:47] Speaker 02:
Do you think that the Northwest Power Act reflects a congressional delegation of authority to the administrator to interpret any of these provisions?

[00:27:00] Speaker 01:
And I guess you haven't made that argument, but I'm just wondering if, having had more time to consider Loper-Brite, if you have any additional thoughts on the question of what the relevance of the... Yes, so the Supreme Court has always recognized that BPA's interpretations are to be given, even of statute, are to be given great weight here.

[00:27:26] Speaker 01:
The situation after Loper-Brite really hasn't changed that much, certainly with regard to this case, because number one, we would say plain language.

[00:27:35] Speaker 01:
We're not even getting into deference at all.

[00:27:37] Speaker 01:
Number two, this provision, sorry, I lost my train of thought there.

[00:27:50] Speaker 01:
We're not suggesting that BPA's reading is binding on the court.

[00:27:56] Speaker 01:
And for years, we've not suggested our construction of the statute is binding.

[00:27:59] Speaker 01:
That goes back to the Douglas County case in 1991.

[00:28:03] Speaker 01:
The court has recognized it's the final interpreter of the statute.

[00:28:07] Speaker 01:
But if you do get to a point where you find that there's a need to consider deference or the weight to be applied to BPAs, then yes, the court certainly should

[00:28:18] Speaker 01:
give great weight to BPA's interpretation for all the reasons that have always existed for that.

[00:28:23] Speaker 01:
I mean, the agency drafted the statute.

[00:28:25] Speaker 00:
After Loper-Brite, I hear what you're saying, but basically it sounds like you're still applying a Chevron deference approach, or we're supposed to give great weight to the agency.

[00:28:37] Speaker 00:
How do we balance that now?

[00:28:38] Speaker 01:
Well, respectfully, Judge Smith, no, we're not asking for a Chevron deference type thing.

[00:28:44] Speaker 01:
We certainly recognize that there is no such thing anymore as an agency's construction of a statute binding the court.

[00:28:56] Speaker 01:
have a different reading the statute, but as long as the agencies is reasonable, we must uphold it.

[00:29:00] Speaker 01:
That's not, that's not our argument at all.

[00:29:02] Speaker 01:
We're simply saying Bonneville's reading should be given highly persuasive effect.

[00:29:07] Speaker 01:
And that's still in place after Loper because it recognized that, you know, uh, the most respectful consideration, the reasons for giving quote, the most respectful consideration to an agency's reading of a statute are things like the agency drafted the statute.

[00:29:22] Speaker 01:
We have that here.

[00:29:24] Speaker 01:
It's highly technical and fact specific.

[00:29:26] Speaker 01:
Our whole conversation today so far has proven that, I think.

[00:29:30] Speaker 01:
We have that here.

[00:29:31] Speaker 01:
We have a contemporary construction by the agency.

[00:29:34] Speaker 01:
We don't always have that but in this case we certainly do and that construction is completely consistent.

[00:29:40] Speaker 01:
uh... forty some years ago with how we're construing it now so loper recognizes that you know those have existed for a hundred and fifty years as reasons for forgiving great weight and that's the supreme court's words in our alcoa decision from nineteen eighty four great weight is to be given well after loper after loper bride we don't uh... basically defer to the agency no binding that by the

[00:30:09] Speaker 00:
reasoning that you've shown over a period of time, the practices and so on are intended to influence the court's construction of the particular statute, is that correct?

[00:30:21] Speaker 01:
In a highly persuasive way, yes.

[00:30:23] Speaker 01:
I think that's completely fair under Loper-Brite to this day.

[00:30:27] Speaker 03:
Two questions.

[00:30:29] Speaker 03:
So you're not making the argument that managing a hydroelectric facility, that allocation of funding isn't too attenuated from managing a facility so that it's not encompassed by that.

[00:30:43] Speaker 03:
Do you understand?

[00:30:44] Speaker 01:
I'm not quite following.

[00:30:45] Speaker 03:
Yeah, so it's, you know, it says managing of electro facility, right?

[00:30:49] Speaker 03:
Managing hydroelectric facility.

[00:30:50] Speaker 01:
That's right.

[00:30:51] Speaker 01:
Physical, actually like pulling levers and turning dials about how much water can go through.

[00:30:55] Speaker 03:
But you're not making the argument that funding decisions are so far removed from managing hydroelectric facilities that it's not encompassed by 11A.

[00:31:06] Speaker 01:
Well, actually we are sort of saying that.

[00:31:09] Speaker 01:
I mean, petitioners want you to take this generalized linguistic reading of the word management.

[00:31:16] Speaker 01:
And what we're saying is, well no, you can't just shoehorn in funding responsibilities by taking that broad

[00:31:24] Speaker 01:
I mean, if Congress had intended us to fund equitably, it would have put the equitable treatment standard, or at least made reference.

[00:31:31] Speaker 03:
Yeah, I'm just trying to push you on the textual part of 11A, in that I'm just seeing if there's any other limitations you're trying to put on the word management.

[00:31:41] Speaker 03:
Besides, you've already said with other purposes, and that's other physical management purposes, I'm just wondering if funding decisions are so far removed from managing electrophacility that it can't be encompassed by the term management.

[00:31:54] Speaker 03:
But it doesn't seem like you're making that argument.

[00:31:56] Speaker 01:
Yeah, BPA's fish and wildlife mitigation funding decisions are so far removed.

[00:32:00] Speaker 01:
I mean, you are.

[00:32:01] Speaker 01:
Yeah.

[00:32:03] Speaker 01:
Yes.

[00:32:03] Speaker 01:
I mean, this this fish and wildlife program, just just so the court understands.

[00:32:07] Speaker 01:
I mean, for the so these RDC decisions cover two rate periods.

[00:32:12] Speaker 01:
which in total spans four years.

[00:32:14] Speaker 01:
So the Fish and Wildlife Program has, as we have included in those rates, $1.2 billion for fish and wildlife, and these RDC decisions were allocating another $50 million and $30 million on top of that.

[00:32:30] Speaker 01:
So the funding decisions that we've made for fish and wildlife,

[00:32:35] Speaker 01:
They're already subject to 4-H-10 and the consistency provision.

[00:32:39] Speaker 01:
We are most assuredly doing things that are consistent with the council's program.

[00:32:45] Speaker 01:
So 10 has its full meaning that it was intended to have, and 11 has its full meaning.

[00:32:49] Speaker 03:
Can I ask, are the same people at BPA making the managing of the physical facility and the allocation of funds?

[00:32:58] Speaker 03:
No.

[00:32:58] Speaker 03:
It's different people.

[00:32:59] Speaker 01:
No.

[00:33:00] Speaker 01:
And this is a perfect illustration of why the two provisions are divorced.

[00:33:04] Speaker 01:
These management and operations decisions, you can think about these like actual, you know,

[00:33:12] Speaker 01:
mechanical decisions like how the dams allow water to go through them or over them or how fast or when.

[00:33:19] Speaker 01:
Those are operational type things and BPA has a role to play in those because it manages and operates those water management decisions when it has to call on power.

[00:33:31] Speaker 01:
I mean it's constantly working with the Corps of Engineers and Bureau of Reclamation about

[00:33:36] Speaker 01:
How much water do we have available?

[00:33:38] Speaker 01:
We have these commitments.

[00:33:41] Speaker 01:
For instance, an example would be a weather event comes along.

[00:33:43] Speaker 01:
We expect high temperatures this week, and so we're going to be needing more water to generate power.

[00:33:48] Speaker 01:
So there's a constant interplay that BPA performs when it's managing and

[00:33:54] Speaker 01:
and operating the water that's available to generate power.

[00:33:58] Speaker 01:
And that's where equitable treatment comes into play.

[00:34:01] Speaker 02:
I was just going to ask you to briefly address the timeliness argument that you've made.

[00:34:08] Speaker 02:
So you're saying that the real challenge is to the RDC provision of the rate schedule.

[00:34:14] Speaker 02:
And my question is, did the rate schedule, in your view, prohibit

[00:34:21] Speaker 02:
the BPA from allocating more than it did to the conservation projects?

[00:34:31] Speaker 01:
No, it didn't have a financial prohibition.

[00:34:34] Speaker 02:
So in that case, why should they have challenged it?

[00:34:39] Speaker 02:
They didn't know until you implemented it.

[00:34:41] Speaker 01:
Right.

[00:34:42] Speaker 01:
Well, because of the way this court's case law on the true nature test works, it says,

[00:34:46] Speaker 01:
that the nature and timing of the action is the key.

[00:34:50] Speaker 01:
That's from the Puget case.

[00:34:52] Speaker 01:
And then in the Pacific Corps or Pacific Power case, it says the factual basis for the claims.

[00:34:57] Speaker 01:
So here, it may be easiest to understand it.

[00:35:00] Speaker 01:
We've presented two alternative ways in which their argument could be sort of packaged.

[00:35:05] Speaker 01:
Easier to understand it under the second one, which is, look, the factual basis for their claims is all these past actions that they still disagree with, that they didn't like how we funded it.

[00:35:16] Speaker 01:
It's summed up on page 62 of their brief where they say, it is clear from the record that BPA has not been providing equitable treatment for fish and wildlife because it has consistently underfunded mitigation efforts.

[00:35:28] Speaker 01:
So they're requiring you to look at that past factual basis and say, that was inequitable.

[00:35:35] Speaker 01:
Now you've got to make up for it with this.

[00:35:37] Speaker 01:
And the court has said, look, if the factual basis is something in the past, they should have challenged those past factual funding decisions.

[00:35:47] Speaker 01:
And the 90 days for that challenge is long gone.

[00:35:51] Speaker 00:
Other questions about my colleague?

[00:35:53] Speaker 00:
All right.

[00:35:53] Speaker 00:
Thank you for your argument, counsel.

[00:35:55] Speaker 00:
I believe, Mr. Missal, you have a few minutes of rebuttal.

[00:36:03] Speaker 04:
Thank you, Your Honor.

[00:36:04] Speaker 04:
I want to make a few points about the text.

[00:36:06] Speaker 04:
So first, BPA says 4H11A is all about physical water management, pulling levers.

[00:36:11] Speaker 04:
There's two problems with that.

[00:36:13] Speaker 04:
Number one, BPA doesn't pull levers.

[00:36:14] Speaker 04:
That's the core in reclamation.

[00:36:17] Speaker 04:
That is what operating the statutes is.

[00:36:18] Speaker 04:
You even, I think, heard Mr. Olive say at one point there, he slipped up and used the word operating to describe the physical water management.

[00:36:25] Speaker 04:
But you don't have to take my word for it.

[00:36:27] Speaker 04:
You can look at 3ER437.

[00:36:30] Speaker 04:
which is where the Corps, the Bureau, and BPA in their EIS for the Columbia River System Operations, which again, Columbia River System Operations, described physical water management as part of operations.

[00:36:45] Speaker 00:
Let's assume you're correct about that.

[00:36:49] Speaker 00:
As you know, opposing council has basically said that 11 deals with the allocation of water.

[00:36:57] Speaker 00:
It has nothing to do with money.

[00:36:59] Speaker 00:
10 deals with money.

[00:37:00] Speaker 00:
What's your best response to that?

[00:37:02] Speaker 00:
I know it's a simplistic approach, but what's your what's your best argument that that's not correct?

[00:37:08] Speaker 04:
So two things.

[00:37:09] Speaker 04:
First is that 4H11 is the place is the only provision that applies to all the agencies.

[00:37:15] Speaker 04:
The core reclamation FERC and BPA.

[00:37:17] Speaker 04:
and it's the only place where non-operational, in other words, things that don't have to do with the allocation of water, where those duties for the other agencies have any tie to the council's program.

[00:37:29] Speaker 00:
So you're saying that, well, take fish and wildlife.

[00:37:33] Speaker 00:
Basically, the way water is used has a huge impact on fish, has a huge impact on wildlife.

[00:37:41] Speaker 00:
So they could be correct that 11 just deals with water

[00:37:46] Speaker 00:
and not money.

[00:37:47] Speaker 00:
Isn't that also true with the other agencies, the other components, if you will, that are dealt with in 11?

[00:37:56] Speaker 04:
So the problem, Your Honor, is that Congress contemplated that the council's program would have offsite mitigation, in other words, things that are not about operations.

[00:38:05] Speaker 04:
for all the agencies to carry out.

[00:38:07] Speaker 04:
And as the council pointed out in its proposed amicus brief, this has been part of the council's program since the beginning.

[00:38:12] Speaker 04:
Under BPA's reading of the statute, those parts of the council's program, which Congress thought would be part of the program, have no bite.

[00:38:19] Speaker 04:
They are unenforceable.

[00:38:21] Speaker 04:
Because 4H11, which again, is the only part of the statute that ties the council's program to the non-BPA agencies, if it only applies to water management, the other agency's non-operational actions

[00:38:35] Speaker 04:
to the extent that the program provides guidance for them has no bite whatsoever.

[00:38:39] Speaker 00:
Let's say that's right.

[00:38:41] Speaker 00:
As you both know very well, these dams in Bonneville Power have been there for a long, long, long, long time.

[00:38:50] Speaker 00:
So far as I can tell, isn't this the first time that you or someone in your position has argued that Section 11 deals with monetary issues?

[00:39:01] Speaker 00:
So, Your Honor, I would...

[00:39:03] Speaker 04:
I'm not sure if that's true.

[00:39:05] Speaker 04:
I know that in the Golden Northwest aluminum case, which was a case about rate making, there was an equitable treatment argument made.

[00:39:11] Speaker 04:
I'm not sure.

[00:39:11] Speaker 04:
I don't know the specifics of that.

[00:39:14] Speaker 04:
I would also say I think that kind of anti-novelty inference is, I think in recent years we've seen that there have been a lot of

[00:39:22] Speaker 04:
things that were long understood that have turned out to be wrong.

[00:39:25] Speaker 04:
So I'm not sure the fact that no one has raised this argument before leads to the inference that it's not a good argument.

[00:39:32] Speaker 00:
Again, with respect, the fact that you have this incredibly important entity for everybody in that part of the country, that this has never, as far as I can tell, been raised before,

[00:39:46] Speaker 00:
I just say, well, you all are smart people.

[00:39:48] Speaker 00:
You've been advocating for fish and wildlife for years and years and years, and the fact you haven't ever brought it up before, shouldn't that have some impact on our analysis?

[00:39:58] Speaker 04:
Your Honor, if I were born 40 years earlier, this would have been raised.

[00:40:02] Speaker 04:
But why weren't you?

[00:40:06] Speaker 02:
You said that in recent years, there have been a lot of things that were well understood that we've learned to be wrong.

[00:40:12] Speaker 02:
Are you talking about Bonneville or administrative law or just the world?

[00:40:15] Speaker 04:
I'm not talking about Bonneville.

[00:40:16] Speaker 04:
I'm talking about administrative law, but also I think cases that have been overturned.

[00:40:21] Speaker 04:
I think that the anti-novelty kind of argument maybe doesn't have the weight that it wants to.

[00:40:30] Speaker 03:
Can I ask if you have a response to the textual argument that in 11A, you know, it could be treated for such fish and wildlife with the other purposes for which the system are managed and operated, and all those refer to physical management issues.

[00:40:44] Speaker 04:
Yeah, my response is that that's wrong, because the purposes includes the purposes of the Northwest Power Act itself.

[00:40:50] Speaker 04:
And the agencies have actually said this.

[00:40:52] Speaker 04:
It's at SER, page 17.

[00:40:54] Speaker 04:
It's also at excerpts of record volume 3, 443, 444.

[00:40:59] Speaker 04:
and the statutory provision is 839 sub 6, where it talks about protecting, mitigating, enhancing fish and wildlife as being one of the purposes of the system.

[00:41:09] Speaker 04:
So purposes includes purposes of, in the Northwest Power Act, and then... That sounds like a management problem, though.

[00:41:17] Speaker 03:
A physical management problem.

[00:41:18] Speaker 04:
No, because it uses the word enhance in there, which is specifically enhancement refers to offsite mitigation.

[00:41:24] Speaker 04:
That's, if you look at 4H5 and 4H8, enhancement refers to

[00:41:29] Speaker 04:
actions taken, non-operational actions taken to address offsite hatcheries.

[00:41:35] Speaker 03:
But that still sounds like a physical management issue, not an expenditure or funding issue.

[00:41:42] Speaker 04:
Your Honor, I think the only way you do off-site enhancement is, I mean, it's going to cost money, and it doesn't really involve, like habitat restoration, for instance, is a form of enhancement.

[00:41:54] Speaker 03:
The Congress does that all the time.

[00:41:55] Speaker 03:
In one hand, they make a statutory authorization to do something, and then you have to go funding somewhere else.

[00:42:00] Speaker 03:
So it seems like it could be consistent in that way, that 11 is about what you should do, and 10 is about funding to do it.

[00:42:07] Speaker 04:
And I guess one response to that would be that, again, that reading, I think, reads the word bandage out, is inconsistent with BPA's position that some of its financial decisions, short-term power purchases fall under, and eliminates any influence the council's program has on non-operational mitigation by the other agencies.

[00:42:29] Speaker 00:
I know you both would have lots of additional things to say.

[00:42:36] Speaker 00:
We appreciate your argument.

[00:42:37] Speaker 00:
The case just argued is submitted, and we will keep in mind the fact that if you'd been born 40 years earlier, you would have raised this.

[00:42:45] Speaker 00:
The case just argued is submitted, and the court stands adjourned for the day.