Court Rules Against State In Vt. Yankee Federal Preemption Case

Aug 14, 2013

A federal appeals court has handed the state of Vermont a significant defeat in its efforts to close the state’s only nuclear power plant.

The court said only the federal government can regulate nuclear safety, and that Vermont lawmakers tried to hide their focus on safety concerns.

The 2nd Circuit Court of Appeals said federal law trumps two state laws that would have forced the Vermont Yankee nuclear plant to close when its original 40 year license expired last year.

The appeals court ruling largely affirms a lower court decision by Judge Garvan Murtha that said Vermont legislators were improperly motivated by safety issues when they passed the laws. The appeals judges said safety is the sole province of the federal government. And they used strong language to describe what they said were lawmakers’ misguided attempt to hide their true motives.

“Vermont legislators repeatedly demonstrated awareness of the potential for a preemption problem and disguised their comments accordingly,” the appeals court said.

The court did hand Vermont one victory: It overturned Murtha’s decision and said the state did not violate the commerce clause of the U.S. Constitution by seeking to condition the Yankee re-licensing on favorable power rates.

If the state had been found liable for the constitutional violation it could have been forced to pay Entergy’s legal bills, estimated last year at $4.6 million and climbing.

Attorney General Bill Sorrell said he was pleased with that part of the decision.

“Well, this is certainly more than half a loaf for Vermont taxpayers,” he said. “We saved the state millions and millions of dollars in attorney’s fees we would have had to pay to Entergy on the constitutional provisions that Judge Murtha said we violated.”

But Sorrell said he was disappointed that the appeals judges – like Judge Murtha – delved deep into the legislative record to try to discern the motives of individual lawmakers.

“They seemed to be even more critical than Judge Murtha was, so the tenor of that aspect of the decision was certainly a surprise and a disappointment,” he said.

Sorrell said he has 90 days to decide whether to appeal the ruling to the U.S. Supreme Court.

Vermont Law School Professor Pat Parenteau sees a silver lining in the appeals court ruling. He said the Vermont Public Service Board can still proceed with its own review of whether Yankee will get a new 20-year license from the state.

“It says to the PSB you now have really clear instructions, if you keep nuclear safety issues completely out of the consideration, out of the record, out of the rationale, out of any way shape or form the basis for your decision, you’re okay,” Parenteau said. “If you stick to economics, you stick to need, you stick to other environmental impacts, you build a decision on those grounds, you’re free to decide the fate of Vermont Yankee.”

Environmentalists were also discouraged by the 2nd Circuit decision, but also gratified that the court did not limit the scope of the PSB review. Sandra Levine is senior attorney with the Conservation Law Foundation.

“There’s a continuing role for Vermont going forward on issues of power supply, on issues of economics, and issues of the trustworthiness of the operators and owners of Vermont Yankee,” Levine said.

The Public Service Board has wrapped up the hearings on the Yankee case and is expected to issue a decision by late fall or early winter.

Read The Second Circuit Court Ruling.

Read The Concurring Ruling.