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CONCERNED CITIZENS OF COHOCTON VALLEY, INC. v. TOW

March 21, 1996

CONCERNED CITIZENS OF COHOCTON VALLEY, INC., Plaintiff,
v.
TOWN OF AVOCA PLANNING BOARD, NEW YORK STATE DEPARTMENT OF ENVIRONMENTAL CONSERVATION, MICHAEL ZAGATZA, as Commissioner of the New York State Department of Environmental Conservation, JEFFREY J. SAMA, Deputy Permit Administrator of the New York State Department of Environmental Conservation, COUNTY OF STEUBEN INDUSTRIAL DEVELOPMENT AGENCY, and J. MAKOWSKI ASSOCIATES, INC., Defendants.



The opinion of the court was delivered by: LARIMER

 INTRODUCTION

 Plaintiff, Concerned Citizens of Cohocton Valley, Inc. ("Citizens") brought this action challenging certain permits that have been granted in connection with a natural-gas storage project in the Town of Avoca, New York ("Town"). Citizens, a not-for-profit corporation made up of Avoca-area residents, contends that the issuance of the permits by several different governmental bodies was unlawful under New York State and local laws, including the State Environmental Quality Review Act ("SEQRA"), Envtl. Conserv. L. § 8-0101 et seq., certain sections of the New York Town Law, New York State regulations, and Town zoning ordinances.

 Jurisdiction is premised upon 28 U.S.C. § 1331, on the ground that questions arising under federal law and the United States Constitution predominate. Specifically, at issue is whether the state and local laws that plaintiff alleges have been violated are preempted by the Natural Gas Act ("NGA"), 15 U.S.C. § 717 et seq., under the Supremacy and Commerce Clauses of the Constitution (Art. VI, cl. 2, and Art. I, § 8, cl. 3, respectively).

 FACTUAL BACKGROUND

 The Avoca Natural Gas Storage Project ("the Project") is a planned project to store natural gas underground in the Town of Avoca. JMAI, the developer of the Project, plans to create caverns deep underground by dissolving subterranean salt deposits through the injection of water, and then forcing the resulting brine further underground, leaving the remaining cavities available for storing natural gas. The Project is expected eventually to store some 5 billion cubic feet of gas for distribution throughout the Northeastern United States.

 On September 20, 1994, the Federal Energy Regulatory Commission ("FERC"), pursuant to its authority under 15 U.S.C. § 717f(c), issued a "Certificate of Public Convenience and Necessity" ("the Certificate"), which in effect approved the Project. Among other things, the Certificate contained an environmental assessment of the Project, and concluded that approval of the Project "will not constitute a major Federal action significantly affecting the quality of the human environment." JMAI's Motion Ex. B. The Certificate also stated that

 
any state or local permits issued with respect to the jurisdictional facilities authorized herein must be consistent with the conditions of this certificate. We encourage cooperation between interstate pipelines and local authorities. However, this does not mean that state and local agencies, through application of state or local laws, may prohibit or unreasonably delay the construction and operation of facilities approved by the Commission.

 Id.

 JMAI also applied for permits from the DEC and the Board. The DEC issued a permit on March 10, 1995, and the Board granted a permit on April 29, 1995.

 Under SEQRA and its accompanying regulations, all state agencies must require submission of an EIS before approving any proposal that may have a significant effect on the environment, or issue a "negative declaration" that the proposal will not have a significant environmental impact. See Envtl. Conserv. L. § 8-0109; 6 N.Y.C.R.R. § 617.3. New York Town Law § 274-b(8) also provides that town boards must comply with SEQRA before issuing special use permits. The DEC and the Board did not require JMAI to submit an EIS, nor did they make a negative declaration under SEQRA, because they both concluded that SEQRA review over the Project was preempted by the NGA.

 Citizens contends that the DEC's and the Board's issuance of these permits without first either requiring an EIS or making a negative declaration violated SEQRA and the Town Law. All of plaintiff's causes of action are based solely upon these state statutes; no violation of the NGA or any other federal law is alleged. Two of the causes of action are also premised upon Town Law § 282, which provides that anyone aggrieved by a decision of a town planning board concerning a plat or the changing of zoning regulations may have the decision reviewed by a special term of the New York supreme court under C.P.L.R. Article 78. *fn1"


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