[Federal Register Volume 64, Number 183 (Wednesday, September 22, 1999)]
[Rules and Regulations]
[Pages 51222-51236]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 99-24616]
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DEPARTMENT OF ENERGY
Federal Energy Regulatory Commission
18 CFR Part 385
[Docket No. RM98-1-000; Order No. 607]
Regulations Governing Off-the-Record Communications
Issued September 15, 1999.
AGENCY: Federal Energy Regulatory Commission, DOE.
ACTION: Final Rule.
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SUMMARY: The Federal Energy Regulatory Commission (Commission) is
revising its rules concerning communications between persons outside
the Commission and the Commission and its employees. The revised
regulations are designed to clarify ambiguities in the existing ex
parte rules and to provide better guidance on what communications to
and from the Commission are permissible and what communications are
prohibited.
EFFECTIVE DATE: This rule is effective on October 22, 1999.
FOR FURTHER INFORMATION CONTACT: David R. Dickey, Office of the General
Counsel, Federal Energy Regulatory Commission, 888 First Street, NE,
Washington, DC 20426, (202) 208-2140.
SUPPLEMENTARY INFORMATION: In addition to publishing the full text of
this document in the Federal Register, the Commission also provides all
interested persons an opportunity to inspect or copy the contents of
this document during normal business hours in the Public Reference Room
at 888 First Street, NE, Room 2A, Washington, DC 20426.
The Commission Issuance Posting System (CIPS) provides access to
the texts of formal documents issued by the Commission from November
14, 1994, to the present. CIPS can be accessed via Internet through
FERC's Homepage (http://www.ferc.fed.us) using the CIPS Link or the
Energy Information Online icon. Documents will be available on CIPS in
ASCII and WordPerfect 8.0. User assistance is available at (202) 208-
2474 or by E-Mail to [email protected].
This document is also available through the Commission's Records
and Information Management System (RIMS), an electronic storage and
retrieval system of documents submitted to and issued by the Commission
after November 16, 1981. Documents from November 1995 to the present
can be viewed and printed. RIMS is available in the Public Reference
Room or remotely via Internet through FERC's Home Page using the RIMS
link or the Energy Information Online icon. User assistance is
available at (202) 208-2222, or by E-Mail to [email protected].
Finally, the complete text on diskette in WordPerfect format may be
purchased from the Commission's copy contractor, RVJ International,
Inc. RVJ International, Inc. is located in the Public Reference Room at
888 First Street, NE, Washington, DC 20426.
I. Introduction
The Federal Energy Regulatory Commission is revising its
regulations governing communications between the Commission's
decisional employees and persons outside the Commission. The revisions
clarify the ground rules for communication, consistent with the
Commission's outreach goals. The final rule is intended to permit fully
informed decision making while at the same time ensuring the continued
integrity of the Commission's decisionmaking process.
II. Background
The amendments added to the Administrative Procedure Act (APA) in
1976 by the Government in the Sunshine Act provided a general statement
as to the limitations and procedures governing ex parte communications
in matters that statutorily require an on the record
hearing.1 Except as otherwise authorized by law, the APA
prohibits ex parte communications relevant to the merits of a
proceeding between employees involved in the decisional process of a
proceeding and interested persons outside the agency.2 The
1976
[[Page 51223]]
Act instructed agencies to issue regulations necessary to implement the
APA's requirements.3 Shortly thereafter, the Federal Power
Commission implemented ex parte regulations based on the APA's
guidance.4 Existing Rule 2201 5 applies to all
covered proceedings before the Commission except those involving oil
pipelines. The Commission currently has a separate ex parte regulation,
Rule 1415,6 originally developed by the Interstate Commerce
Commission (ICC), which applies only to oil pipeline
proceedings.7 Although directed to the same end--both
prohibit certain ex parte communications and both describe methods for
public disclosure of such communications--they differ in significant
details. The manner in which the existing ex parte regulations have
been interpreted and applied within and outside of the Commission has
led to a great deal of confusion.
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\1\ 5 U.S.C. 551-557. Section 557 applies ``according to the
provisions thereof, when a hearing is required to be conducted in
accordance with section 556 of this title.'' Section 556 applies to
hearings required by sections 553 and 554.
\2\ 5 U.S.C. 557(d) provides that:
(1) In any agency proceeding which is subject to subsection (a)
of this section, except to the extent required for the disposition
of ex parte matters as authorized by law--
(A) No interested person outside the agency shall make or
knowingly cause to be made to any member of the body comprising the
agency, administrative law judge, or other employee who is or may
reasonably be expected to be involved in the decisional process of
the proceeding, an ex parte communication relevant to the merits of
the proceeding;
(B) No member of the body comprising the agency, administrative
law judge, or other employee who is or may reasonably be expected to
be involved in the decisional process of the proceeding, shall make
or knowingly cause to be made to any interested person outside the
agency an ex parte communication relevant to the merits of the
proceeding;
(C) A member of the body comprising the agency, administrative
law judge, or other employee who is or may reasonably be expected to
be involved in the decisional process of such proceeding who
receives, or who makes or knowingly causes to be made, a
communication prohibited by this subsection shall place on the
public record of the proceeding:
(i) All such written communications;
(ii) Memoranda stating the substance of all such oral
communications; and
(iii) All written responses, and memoranda stating the substance
of all oral responses, to the materials described in clauses (i) and
(ii) of this subparagraph;
(D) Upon receipt of a communication knowingly made or knowingly
caused to be made by a party in violation of this subsection, the
agency, administrative law judge, or other employee presiding at the
hearing may, to the extent consistent with the interests of justice
and the policy of the underlying statutes, require the party to show
cause why his claim or interest in the proceeding should not be
dismissed, denied, disregarded, or otherwise adversely affected on
account of such violation; and
(E) The prohibitions of this subsection shall apply beginning at
such time as the agency may designate, but in no case shall they
begin to apply later than the time at which a proceeding is noticed
for hearing unless the person responsible for the communication has
knowledge that it will be noticed, in which case the prohibitions
shall apply beginning at the time of his acquisition of such
knowledge.
(2) This subsection does not constitute authority to withhold
information from Congress.
\3\ 5 U.S.C. 559.
\4\ FPC Order No. 562, 42 FR 14701 (Mar. 16, 1977).
\5\ 18 CFR 385.2201.
\6\ 18 CFR 385.1415.
\7\ 18 CFR 385.1415.
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In October 1992, upon determining that a proposed negotiated
rulemaking effort would be cumbersome and ineffective,8 the
Commission noticed a Public Conference for the purpose of examining the
Commission's ex parte regulations and providing, inter alia, that the
Commission wanted to provide clearer guidance on whether the ex parte
prohibitions should apply to all Commission employees or be more
limited, e.g., to Commissioners, their personal staff, and other
decisional employees.9 The notice further recited the need
for clearer standards governing informal consultations between the
Commission's environmental staff and other federal agencies that have
environmental responsibilities or interests impacting our decisions, as
well as contacts between the Commission and applicants and other
persons for the purpose of obtaining information necessary for
environmental analyses.10
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\8\ See Determination Not to Establish a Negotiated Rulemaking
Committee, Docket No. RM 91-10-000, 57 FR 10621 (Mar. 27, 1992), IV
FERC Stats. & Regs. para. 35,023 (Mar. 20, 1992).
\9\ Notice of Public Conference, Regulations Governing Ex Parte
Communications, Docket No. RM91-10-000, 58 FERC para. 61,320 (Mar.
20, 1991).
\10\ Id.
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As a result of the March 1992 public conference, participants
developed a general consensus favoring a revised rule that would
provide the Commission, the industry, and the public with a clearer
statement of what communications are prohibited and when the
prohibitions apply.11 It is evident from comments on the
March 1992 Notice of Public Conference, and from the ongoing
experiences of staff and persons outside the agency, that the language
and application of our existing ex parte rule should be revised for the
sake of clarity.
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\11\ See, e.g., the comments filed by Interstate Natural Gas
Association, the Industrial Groups, Pacific Gas Transmission
Company, and Environmental Action in Docket No. RM91-10-000. Notice
of Public Conference, 57 FR 10622 (Mar. 27, 1992); IV FERC Stat. &
Regs. para. 35,023 (Mar. 20, 1992).
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Moreover, the Commission has recognized the benefits of enhancing
its access to information from federal and state agencies and other
interested persons to the extent consistent with law and fair process.
More recently, discussions undertaken as part of the Commission staff's
ongoing reengineering effort indicated that many people believe that
changes to the current ex parte rule could enhance the Commission's
operations.
On September 16, 1998, the Commission issued a Notice of Proposed
Rulemaking (NOPR) to revise its procedural rules concerning
communications between the Commission and its employees and persons
outside the Commission.12 The NOPR requested comments on the
proposed changes to the Commission's procedural rules governing
communications between the Commission and its employees and persons
outside the Commission.13 Thirty-two commenters,
representing the hydropower, electric power, and natural gas pipeline
industries, as well as state and federal resource agencies filed
comments generally supporting adoption of the rule as proposed in the
NOPR.14 Their comments offer a number of recommendations and
suggestions for improving the proposed rule, some of which are adopted
in the final rule, and some which are not, as discussed more thoroughly
below.
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\12\ Regulations Governing Off-the-Record Communications, 63 FR
51312 (Sept. 25, 1998); FERC Stats. & Regs. (Proposed Regulations
1988-1998) para. 32,534 (Sept. 16, 1998).
\13\ The Commission sought comments notwithstanding that,
because this is a procedural rule, no opportunity for comment is
required by the APA.
\14\ The commenters are identified in Appendix A.
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III. Discussion
The final rule is based on the fundamental APA principles that are
the foundation for the ex parte prohibition, and furthers the basic
tenets of fairness: (1) A hearing is not fair when one party has
private access to the decision maker and can present evidence or
argument that other parties have no opportunity to rebut; 15
and (2) reliance on ``secret'' evidence may foreclose meaningful
judicial review.16 The final rule sets out when
communications between the Commission and Commission staff and persons
outside the Commission may take place off-the-record, and when such
communications must take place on the record. The final rule also
contains directions on how both prohibited and exempted off-the-record
communications will be handled by the Secretary's office and how public
notice of such communications will be made.
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\15\ WKAT, Inc. v. FCC, 296 F.2d 375 (D.C. Cir.), cert. denied,
360 U.S. 841 (1961).
\16\ Home Box Office, Inc. v. FCC, 567 F.2d 9, 54 (D.C. Cir.),
cert. denied, 434 U.S. 829 (1977); U.S. Lines v. Federal Maritime
Commission, 584 F.2d 519, 541-542 (D.C. Cir. 1978).
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A. Overview
The final rule generally follows the direction of the proposed
rule. The final rule applies to off-the-record communications made in a
``contested on-the-record proceeding,'' defined as ``any proceeding
before the Commission to which there is a right to intervene and in
which an intervenor disputes any material issue, or any proceeding
initiated by the Commission on its own motion or in response to a
filing.'' Proceedings not covered by this rule include informal (i.e.,
notice and comment) rulemaking proceedings under 5 U.S.C. 553;
investigations under part 1b; public technical, policy, and other
conferences intended to inform
[[Page 51224]]
the public or solicit comments on general issues of interest to the
Commission and the public; any other proceeding not having a ``party or
parties,'' as defined in Rule 102 of the Commission rules of practice
and procedure 17; and any proceeding in which no party
disputes any material issues. Although the APA permits off-the-record
communications concerning general background or policy discussions
about an industry or segment of an industry, discussions of how such
background or policy information might apply to the specific merits of
a pending proceeding are not permitted.18
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\17\ 18 CFR 385.102.
\18\ See H.R. Rep. No. 94-880 (Part I), at 20 (1976), reprinted
in 1976 U.S.C.C.A.N. at 2202.
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The NOPR proposed 10 exemptions to the general prohibition against
off-the-record communications in contested, on-the-record proceedings
at the Commission. Seven of the proposed exemptions are adopted in the
final rule largely as proposed in the NOPR--(1) off-the-record
communications expressly permitted by rule or order, (2) off-the-record
communications related to emergencies, (3) off-the-record
communications agreed to by the parties, (4) off-the-record written
communications with non-party elected officials, (5) off-the-record
communications with other Federal, state, local and Tribal agencies,
(6) off-the-record communications related to National Environmental
Policy Act (NEPA) documentation, and (7) off-the-record communications
with individual non-party landowners. These are discussed below. As a
clarification, the final rule refers to ``exempted'' rather than
``permitted'' off-the-record communications in the regulatory text.
Three proposed exemptions are dropped in this final rule because
they are unnecessary. The NOPR proposed an exemption for communications
taking place prior to the filing of an application for Commission
action (generally referred to as a ``pre-filing'' meeting or
conference). As more thoroughly discussed below, this exemption is
eliminated as unnecessary in the final rule, because pre-filing
communications are outside the purview of this rule because they take
place prior to the filing of an application, and therefore prior to any
``proceeding'' at the Commission.
The NOPR proposed an exemption for published or broadly
disseminated public information. We subsequently have concluded that,
where staff obtains such information of its own volition, no exemption
is required to permit Commission staff to access and consider widely
available public information. Thus, that exemption has been deleted in
the final rule although information relied on by the Commission must be
put into the public record.
Finally, the NOPR also proposed an exemption for communications
related to compliance matters where compliance was not the subject of a
pending proceeding. The final rule addresses this concern by defining
such communications as not relevant to the merits, rather than by
providing a separate exemption.
The final rule establishes notice and disclosure requirements for
both prohibited and exempted communications. These provisions are
similar to those proposed in the NOPR.
B. General Comments
The comments received from the 32 commenters generally were
supportive of the Commission's efforts to clarify and reform the
current rules. Several general comments are addressed in this section;
comments on specific elements of the NOPR are discussed below.
Several commenters expressed concern that the revised rules could
operate to the detriment of small entities.19 It is not our
intent to create rules or regulations having a discriminatory effect on
any segment of the Commission's constituency, particularly smaller
entities that may not have a regular presence in Washington, DC, or may
lack the resources of larger entities. Everybody doing business with
the Commission should be assured that the purpose of the final rule on
communications is to enhance the ability of all entities involved in a
particular proceeding to communicate with the Commission on an equal
footing.
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\19\ See EPSA at 4; Joint Commenters at 3-4.
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One weakness in the prior rule is that it did not expressly apply
to off-the-record communications initiated by the Commission and its
staff. This deficiency appears to be inconsistent with the approach of
the APA that, in general, ex parte proscriptions should apply when one
party has private off-the-record communications with a decisional
authority, regardless of who initiated the contact, so that other
parties are not deprived of fundamental fairness and due process.
Therefore, the final rule applies to off-the-record communications from
decisional Commission employees to persons outside the Commission as
well as off-the-record communications from persons outside the
Commission to Commission decisional employees. The prohibitions apply
both to oral and written off-the-record communications.
One commenter opines that, while most of the reforms set out in the
proposed rule are generally desirable and will give the Commission more
flexibility in communicating with other entities, the rule, if strictly
applied, would seem to reduce some of the flexibility commonly
practiced under the existing rule.20 This commenter believes
that exposing staff to possible recriminations for such off-the-record
communications might have a chilling effect on staff and forecloses the
type of meaningful dialogue that might otherwise lead to informed
decision making, and suggests more extensive use of notice and
disclosure procedures to further enhance communications.
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\20\ Sempra at 3-4.
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The final rule is not intended to reduce communications. Rather, by
clarifying some of the confusion that existed with the prior rule, the
net result should be to improve meaningful dialogue that is necessary
to informed and fair decision making. The final rule defines when a
communication is considered off-the-record, and sets forth certain
exemptions for when off-the-record communications may be permitted.
C. Definitions in the Final Rule
The final rule provides relevant definitions. These are discussed
seriatim.
(1) Off-the-Record Communication
As proposed in the NOPR, an ``off-the-record communication'' was
defined as ``any communication which, if written, is not served on the
parties, and, if oral, is made without prior notice to the parties.''
Several commenters believe that the definition of an oral off-the-
record communication should be amended so that even if prior notice is
provided for the off-the-record oral communication, it should
nonetheless be categorized as prohibited unless there was an
opportunity for all parties to be present when the communication was
made.21 One commenter argues that such an amendment gives
context to the nature of prohibited oral communications and tracks the
language of the Federal Communication Commission's (FCC's) ex parte
rule.22
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\21\ INGAA at 2 (INGAA's comments are endorsed by Southern
Natural Gas Company, Natural Gas Supply Association, and the
Williams Companies).
\22\ Id. at 2-3.
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The Commission agrees that the proposed definition should be
modified along the lines suggested. Accordingly, in the final rule,
``off-the-record communication'' is defined as ``any
[[Page 51225]]
communication relevant to the merits of a contested on-the-record
proceeding which, if written, is not filed with the Secretary and not
served on the parties to the proceeding pursuant to Rule
2010,23 and if oral, is made without reasonable prior notice
to the parties to the proceeding, and without the opportunity for such
parties to be present when the communication is made.'' Many oral
communications are made by telephone conference calls during which all
parties may not be physically ``present.'' We will interpret the
definition of ``present'' to include presence by telephone or similar
means. The definition of ``written communications'' includes
communications transmitted by electronic means such as ``e-mail.''
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\23\ 18 CFR 385.2010
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(2) Contested On-the-Record Proceeding
The APA ex parte prohibitions apply to adjudications and similar
cases required by statute to be decided on the record after an
opportunity for hearing.24 Courts generally have treated
rules barring private communications as a basic element of a fair
hearing--whether an APA-type oral evidentiary hearing or one involving
``paper'' exhibits and pleadings--in any case involving competing
private claims to a valuable privilege or benefit.25
Consequently, the final rule extends the prohibitions to all
``contested on-the-record proceedings.'' The NOPR defined a ``contested
on-the-record proceeding'' as ``any complaint, action initiated by the
Commission, or other proceeding involving a party or parties in which
an intervenor opposes a proposed action.''
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\24\ 5 U.S.C. 557(d)(1).
\25\ Sangamon Valley Television Corp. v. United States, 269 F.2d
221 (D.C. Cir. 1959); and Sierra Club v. Costle, 657 F.2d 298, 400
(D.C. Cir. 1981).
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One commenter believes the definition is too narrow because it
would attach only in a proceeding in which a party has filed in
opposition to an application. The commenter believes that the
Commission should deem as contested a proceeding where parties contest
legal or factual issues, such as the proper scope of mitigation for
environmental harm, even if they do not necessarily contest the
propriety of the application, and expresses uncertainty over whether
the rule would apply in circumstances where the posture of an
intervention is unclear and the Commission has not yet issued a formal
determination that the proceeding is contested.26 The
commenter thus believes that the proposed definition could motivate a
party to take a position in opposition to an application merely to
prevent off-the-record communications from taking place, a proposition
it notes as contrary to the new policy of encouraging collaboration in
licensing proceedings.27 As a solution, the commenter
suggests amending the proposed definition to include the possibility
that the prohibition on off-the-record communications could be invoked
by an intervenor's mere request that the rule apply, even in the
absence of dispute over a material issue.
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\26\ HRC at 2.
\27\ Id. at 2-3.
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The Commission will not rely on intervenor requests to trigger the
rule's application. One purpose of the final rule is to permit and
encourage more open communications between the Commission and the
public, and, therefore, an overbroad definition of when this rule would
be triggered would be counter to this goal. The Commission will not
treat an intervention as triggering the requirements of this rule when
it appears to have been made solely for the purpose of causing the
intervenor to be placed on the service list or solely for the purpose
of seeking permission to participate in a hearing, should the
Commission order that a hearing be held.
To clarify, however, the Commission will amend the definition in
the final rule so that a ``contested on-the-record proceeding'' is
``any proceeding before the Commission to which there is a right to
intervene and in which an intervenor disputes any material issue, or
any proceeding initiated by the Commission on its own motion or in
response to a filing.'' Consistent with current practice, a dispute of
``any material issue'' may include a dispute of fact, law or policy.
This amendment to the NOPR's definition of a contested on-the-record
proceeding is more consistent with the APA and its legislative history.
The explicit requirement that the proceeding be ``contested'' before ex
parte rules attach reflects the notion that procedural requirements and
constraints originally developed to preserve the rights of parties in
an adjudication have no place in an administrative proceeding in which
there is no ``contest'' comparable to the controversy in a judicial
case. For purposes of this definition, an ``on-the-record'' proceeding
includes both proceedings set for oral hearings and so-called ``paper
hearings'' where the matter is disposed of on evidence taken only by
written submissions.
The definition expressly excludes ``notice-and-comment rulemaking
under 5 U.S.C. 553, investigations under part 1b of this chapter,
proceedings not having a party or parties, or any proceeding in which
no party disputes any material issue.'' With this change, the NOPR's
separate definition of ``proceeding involving a party or parties'' is
unnecessary and is omitted.
(3) Decisional Employee, Contractor, and Person
The NOPR proposed to define a ``decisional employee'' as ``a
Commissioner or member of his or her personal staff, an administrative
law judge, or any other employee or contractor of the Commission who is
or may reasonably be expected to be involved in the decisional process
of a particular proceeding, but does not include an employee designated
as a part of the Commission's trial staff in a proceeding, a settlement
judge appointed under Rule 603 (settlement of negotiations before a
settlement judge), a neutral (other than an arbitrator) in an
alternative dispute resolution proceeding subject to Rule 604, or an
employee designated as non-decisional in a particular proceeding
subject to the separation of functions requirements applicable to trial
staff under Rule 2202 (separation of functions of staff).''
One resource agency asks whether the definition of ``decisional
employee'' includes the Commission's environmental staff and directors
of the program offices.28 It does. As a general rule, we
view these employees as involved in the analysis and decisionmaking
process so that, to the extent they are assigned to a particular
proceeding with the goal of making recommendations for the Commission's
consideration, they must be considered as decisional employees.
However, specified communications between persons outside the
Commission and the Commission's environmental staff and directors of
the program offices may take place off-the-record pursuant to one of
the exemptions to the prohibition of the general rule discussed below.
Another commenter notes that, as proposed, the rule would not apply to
staff who are non-decisional employees, focuses on prohibited
communications to and from persons outside the Commission, and does not
address communications between decisional and non-decisional FERC
staff.29 The commenter apparently reads the rule as eroding
or modifying the Commission separation of functions rule (18 CFR
385.2202) and requests the Commission to reaffirm Rule 2202 and specify
that decisional and non-decisional staff
[[Page 51226]]
would not be permitted to engage in prohibited communications in
contested proceedings.30 Other commenters specifically
request that the definition be amended to include Commission trial
staff and other non-decisional employees.31 One commenter
suggests that these Commission employees be considered as outside of
the Commission, and subject to the rule.32
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\28\ ACHP at 1.
\29\ INGAA at 3.
\30\ Id.
\31\ WPPI at 4; SCSI at 2-3
\32\ SCSI at 2-3.
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We find that these proposed modifications are not necessary or
practicable. Rule 102(b) of the Commission's rules of practice and
procedure sets forth the definition of a ``participant'' in Commission
proceedings as ``(1) Any party; or (2) any employee of the Commission
assigned to present the position of the Commission staff in a
proceeding before the Commission,'' thus distinguishing between
Commission trial staff and a party participant to a
proceeding.33 Furthermore, Rule 2202 remains in place and as
such adequately regulates the conduct of intra-agency communications
that concerns these commenters.34 The Commission reaffirms
its commitment to the tenets of the separation of functions rule. This
commitment is recognized in the current Commission organizational
design, with the new Office of Administrative Litigation encompassing
all Commission employees engaged in trial work.
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\33\ 18 CFR 385.102(b).
\34\ 18 CFR 385.2202. The Separation of Functions Rule precludes
employees performing investigative or trial functions in a
particular case from participating as ``decisional employees'' in
the same matter or in a related matter.
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As set forth in the NOPR and reflected in the final rule, the
Commission may designate any member of the Commission staff as ``non-
decisional in a proceeding.'' As a non-decisional employee, he or she
would be subject to the requirements of Rule 2202. This gives the
Commission the necessary flexibility to make appropriate allocations of
its human resources.
The Commission's administrative law judges fall into a unique
category. Consequently, with the addition of a clause to the exemptions
provisions discussed below, the final rule prohibits the making of any
off-the-record communications to or by a presiding officer in any
proceeding set for hearing under subpart E of the Commission's rules of
practice and procedure.35 For subpart E proceedings, none of
the exemptions for off-the-record communications applies to presiding
officers.
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\35\ 18 CFR 385.501 et seq.
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In contrast, when an administrative law judge is appointed by the
Chief Administrative Law Judge as a settlement judge under rule
603,36 or when an administrative law judge is selected as a
neutral under rule 604 37 the administrative law judge is
not a decisional employee in that proceeding.
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\36\ 18 CFR 385.603.
\37\ 18 CFR 385.604.
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Pursuit of alternative dispute resolution by the Commission's
Dispute Resolution Service (DRS) is not part of the decisional process
and is not subject to these ex parte rules. Alternative dispute
resolution procedures are set out in Commission Rule 604.38
Communications undertaken in the context of alternative dispute
resolution are confidential. Moreover, DRS employees are not decisional
employees themselves, nor do they advise decisional employees on
matters relevant to the merits of a particular matter.
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\38\ Id.
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One commenter opposes including third-party contractors in the
definition of decisional employees, asserting that applicants need to
have confidential discussions with those preparing their NEPA
evaluations.39 To be sure, third-party contracting reflects
a scheme by which an applicant is responsible for directly paying and
cooperating with a contractor selected to perform environmental
analyses. However, the selection of the contractor is subject to
Commission approval and Commission staff is responsible for directing
the work of the contractor.40 Thus, in the same manner as
direct Commission contractors, a third-party contractor plays the role
of a Commission decisional employee, subject to the proscriptions of
the rules against prohibited off-the-record communications.
Accordingly, merits-related communications between an applicant and a
contractor are governed by these rules.
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\39\ NHA at 2.
\40\ 40 CFR 1506.5.
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Finally, one resource agency commented that pre-decisional
technical involvement by Commission staff should be outside the purview
of the rule, so that Federal, state, local or tribal agencies may
freely communicate with Commission staff on technical
issues.41 To the extent that the technical issues are not
related to the merits of the underlying proceeding, such communications
would be permitted. Such communications may also be permitted under the
exemptions for communications between Federal agencies having common
jurisdictional interests in a particular matter or for NEPA document
preparation.42
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\41\ See Interior at 11-12.
\42\ 18 CFR 385.2201(e)(1)(v), 385.2201(e)(1)(vi).
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(4) Relevant to the Merits
The final rule applies to off-the-record communications relevant to
the merits of a Commission proceeding in covered proceedings. The term
``relevant to the merits'' is taken directly from the APA and its
definition is drawn from the legislative history of those
provisions.43 The term is defined to mean ``capable of
affecting the outcome of a proceeding, or of influencing a decision, or
providing an opportunity to influence a decision, on any issue in the
proceeding.'' The regulatory text states that purely procedural
inquiries or status requests that will not have an effect on the
outcome of a case or on the decision on any issue are not ``relevant to
the merits.'' Communications relating to purely procedural inquiries,
such as how to intervene in a proceeding, the number of days before a
responsive filing is due, or the number of copies that must be provided
for a required filing are permitted at any time. Where a communication
states or implies a preference for a particular party or position, it
would be considered as being relevant to the merits. Although simple
requests for action by a specific date or for expedited action may be
viewed as not relevant to the merits, the Commission strongly
encourages that any such requests be made in writing and on the record.
---------------------------------------------------------------------------
\43\ See H.R. Rep. No. 94-880 (Part I), at 20, reprinted in 1976
U.S.C.C.A.N. at 2202:
The (statute) prohibits an ex parte communication only when it
is ``relative to the merits of the proceeding.'' This phrase is
intended to be construed broadly and to include more than the phrase
``fact in issue'' currently used in the Administrative Procedure
Act. The phrase excludes procedural inquiries, such as requests for
status reports, which will not have an effect on the way the case is
decided. It excludes general background discussions about an entire
industry which do not directly relate to specific agency
adjudication involving a member of that industry, or to formal
rulemaking involving the industry as a whole. It is not the intent
of this provision to cut an agency off from general information
about an industry that an agency needs to exercise its regulatory
responsibilities. So long as the communication containing such data
does not discuss the specific merits of a pending adjudication it is
not affected by this section.
---------------------------------------------------------------------------
As discussed further below, the definition also excludes
communications related to compliance matters if compliance is not the
subject of an ongoing proceeding.
[[Page 51227]]
D. Exempt Off-the-Record Communications
The final rule sets out seven exemptions from the general
prohibitions against off-the-record communications. These exemptions
are independent of one another. Accordingly, if any exemption applies
to the circumstances of a particular proceeding, off-the-record
communications will be permitted subject to any disclosure
requirements. For example, Rule 2201(e)(1)(iii),44 provides
that the proscriptions of this rule do not apply where all parties to a
proceeding have agreed in writing that off-the-record communications
may take place. However, even in the absence of such unanimity, off-
the-record communications relating to development of an environmental
impact statement would be permitted in accordance with the exemption
contained in Rule 2201(e)(1)(vi).45
---------------------------------------------------------------------------
\44\ 18 CFR 385.2201(e)(1)(iii).
\45\ 18 CFR 385.2201(e)(1)(vi).
---------------------------------------------------------------------------
We note that while the final rule exempts certain off-the-record
communications from the prohibitions of the rule, the Commission and
Commission staff retain the discretion not to engage in permitted
communications if, in their judgment, such communications would create
the appearance of an impropriety or otherwise seem inconsistent with
the best interests of the Commission.46
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\46\ See 18 CFR 385.2201(j)(2).
---------------------------------------------------------------------------
(1) Off-the-Record Communications Expressly Permitted by Rule or Order
To the extent permitted by law, Rule 2201(a) allows the Commission,
by rule or order, to modify any of the ex parte provisions as they
apply to all or part of a proceeding. Resource agencies commented that
statutes such as the Endangered Species Act require interagency
consultations, within and outside of the context of preparing an
environmental document.47 These commenters ask if the rule
should consider whether statutes mandating such consultations properly
fit within this exemption.
---------------------------------------------------------------------------
\47\ E.g., Interior at p. 6.
---------------------------------------------------------------------------
As discussed in the NOPR,48 only where there is specific
statutory authority permitting or directing interagency consultations
to take place on an ex parte basis, would such off-the-record
communications be construed as ``authorized by law.'' We do not believe
that statutes requiring interagency consultations should be viewed as
authorizing such communications to take place off-the-
record.49 Under other exemptions of the final rule, however,
the types of communications addressed by resource agencies may often be
permissible, subject to a disclosure requirement.50
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\48\ Notice of Proposed Rulemaking, Regulations Governing Off-
the-Record Communications, 63 FR 51312, 51316 (Sept. 25, 1998).
\49\ In fact, pursuant to NEPA, prior to issuing a detailed
environmental statement, an agency must make available, pursuant to
the Freedom of Information Act (FOIA), the comments and views of
cooperating agencies. See 42 U.S.C. 4233(C.)
\50\ See 18 CFR 385.2201(e)(1)(v) or (vi). We note however that
the disclosure requirement in this rule does not permit the
Commission or any resource agency to publicly disclose statutorily
protected information. There are statutory prohibitions against
disclosing the location of certain historically, culturally, or
environmentally sensitive resources, but there is no such
prohibition on setting conditions to protect such resources. See,
e.g., Section 304 of the National Historic Preservation Act, as
amended, 16 U.S.C. 470w-3.
---------------------------------------------------------------------------
(2) Off-the-Record Communications Related to Emergencies
The final rule provides an exemption, subject to a notice and
disclosure provision, for communications relating to emergencies. The
NOPR proposed such an exemption for communications related to
emergencies, and specifically requested comments on whether last year's
Midwest price spike might qualify as an emergency under such an
exemption. Some commenters suggest that an ``act of God'' emergency
would not likely occur in the context of a contested
proceeding.51 Because of the high stakes that might be
involved in a contested proceeding, however, it was suggested that, if
adopted, the proposed exemption be triggered only after a decision by
the Commission or a senior staff official.
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\51\ E.g., Joint Commenters at 9-10.
---------------------------------------------------------------------------
Other comments suggest that the final rule better define covered
emergencies, and that generic fact-finding would be a better mechanism
for handling communications concerning emergencies.52
Commenters also noted that, because resource agencies might have
specific statutory responsibilities relating to natural disasters, the
Commission should promptly disclose off-the-record communications
related to such emergencies.53
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\52\ EEI at 8-9.
\53\ Interior at 7.
---------------------------------------------------------------------------
We agree with the commenters' suggestions that it is unlikely that
communications relating to emergencies would take place in the context
of a pending contested proceeding, and we also find some merit in the
argument that permitting off-the-record communications during
``economic'' emergencies could have an adverse effect on regulated
energy markets in the context of a contested proceeding.54
We believe that the Commission's investigative powers under its
enabling statutes and part 1b (``Rules Relating to Investigations''
under subchapter A ``General Rules'') of its regulations appear to be
sufficiently broad to allow informal investigations into ``significant
market anomalies,'' and such investigations are outside the scope of
this rule.
---------------------------------------------------------------------------
\54\ Joint Commenters at 9-10.
---------------------------------------------------------------------------
However, especially with regard to emergencies affecting a
regulated entity's ability to deliver energy, it is imperative that the
regulated community be assured that, in the face of an emergency, it
may initiate communications with the Commission without fear of
violating the prohibitions on off-the-record communications, even in
the context of a contested proceeding. By their very nature,
emergencies do not allow prior opportunity for public participation in
meetings addressing issues relating to the emergency. Concomitantly,
Commission staff must be able to receive an emergency communication
without fear of violating ex parte considerations or other provisions
of the Commission's standards of conduct for employees. Therefore, the
final rule adopts this exemption. Because we believe that the
Commission can proceed to investigate emergencies, once identified,
under its part 1b procedures, the final rule makes clear that this
exemption is limited to communications from persons outside the
Commission, and requires prompt notice and disclosure of the
communication. The prompt disclosure required under this exemption
should alleviate any possible detriment occasioned by allowing such
communications.
(3) Off-the-Record Communications Agreed to by the Parties
The NOPR proposed to retain prior Rule 2201(b)(6) permitting
communications which all the parties to a proceeding agree may be made
without regard to communication constraints. We conclude that
agreements to waive this rule must be in writing and subject to
Commission approval.55
---------------------------------------------------------------------------
\55\ See WKAT, Inc., v. FCC, 296 F.2d 375 at 383 (D.C. Cir.
1961).
---------------------------------------------------------------------------
The NOPR sought comments on whether pre-filing communications
protocols permitted under our collaborative procedures initiatives
56
[[Page 51228]]
should be allowed to remain in effect after a filing is made. The
general consensus of commenters is that pre-filing communications
protocols agreements should be renewed or otherwise approved by all
parties to a proceeding once a filing is made and the time for filing
interventions has passed.57
---------------------------------------------------------------------------
\56\ See Order No. 596, Regulations for the Licensing of
Hydroelectric Projects, 62 FR 59802 (Nov. 5, 1997), III FERC Stats.
& Regs. para. 31,057 (Oct. 29, 1997).
\57\ See, e.g., ACHP at 2; EEI at 9; Williston at 5-6; SMUD; at
5.
---------------------------------------------------------------------------
We agree with the commenters. In order to qualify for this
exemption, pre-filing protocols must be renewed by all parties and
approved by the Commission after an application is filed with the
Commission and the time for filing interventions has expired. At that
time, the identities of all parties participating in the proceeding
have been determined.
(4) Off-the-Record Written Communications from Non-Party Elected
Officials
The Commission receives numerous letters from Federal and state
elected officials requesting expedition and forwarding correspondence
from constituents. The NOPR proposed treating such written
communications as permitted communications, subject to a notice and
disclosure requirement under which the communications would be placed
in the public record.58 Various commenters urge that the
exemption include any communications from Commission officials to the
non-party elected official,59 be limited to
Congress,60 restrict covered officials from forwarding to
the Commission the comments of constituents who are parties to a
particular proceeding,61 and extend to Tribal
officials.62
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\58\ The legislative history of the APA makes clear that members
of Congress are ``interested persons'' subject to the APA
restrictions on communications. It also indicates, however, that
this prohibition is not intended to prohibit routine inquiries or
referrals of constituent correspondence. See H.R. Rep. No. 94-880
(Part 1), (at 21-22), reprinted in 1976 U.S.C.C.A.N at 2203.
\59\ INGAA at 4, SoCalEd at 8-9.
\60\ Id.
\61\ BPA at 3-4.
\62\ Interior at 10.
---------------------------------------------------------------------------
The final rule generally adopts the proposed exemption. The
exemption covers only written communications. Because such
communications may be relevant to the merits, this exemption contains a
notice and disclosure requirement.
We agree with commenters that communications from elected, non-
party Tribal officials should be included among those communications
permitted by this exemption. Indian tribes frequently have interests
that may be substantially affected by Commission proceedings.
Any communications from Commission officials to elected officials
are not covered by this exemption. Consistent with current practice,
Commission responses to correspondence from elected officials do not
address the merits. Nevertheless, such responses will be placed in the
record.
(5) Off-the-Record Communications with Other Federal, State, Local, and
Tribal Agencies
Prior Rule 2201(b)(1) 63 permitted off-the-record
communications from interceders who are Federal, state or local
agencies that have no official interest in, and whose official duties
are not affected by, the outcome of a covered proceeding to which the
communication relates. What was meant by ``official duties'' or having
``no official interest in'' a covered proceeding was unclear, at best.
---------------------------------------------------------------------------
\63\ 18 CFR 385.2201(b)(1).
---------------------------------------------------------------------------
Because many of the agencies with which the Commission works have
an interest in Commission proceedings, the NOPR proposed an exemption
to permit off-the-record communications, subject to a disclosure
requirement, with Federal, state, or local agencies that are not
parties in a specific contested proceeding. As proposed, there would be
an exemption for off-the-record communications involving: (1) A request
for information by the Commission or Commission staff; or (2) a matter
over which the other Federal, state, or local agency and the Commission
share regulatory jurisdiction, including authority to impose or
recommend licensing conditions.
One commenter strongly objects to this exemption and suggests that
agencies use memoranda of understanding to define their respective
roles.64 Three other commenters suggest that government
agencies are no different from other parties with specific interests in
the outcome of a proceeding and, thus, should not be accorded special
treatment, particularly when the Commission may grant late intervention
to agencies.65 On the other hand, most resource agencies
believe the exemption should be expanded to include party, as well as
non-party, agencies.66
---------------------------------------------------------------------------
\64\ HRC at 5-6.
\65\ See, EEI at 3; Joint Commenters at 10-11; NHA at 2-3.
\66\ Interior at 11-12; NMFS at 2; EPA at 1-2.
---------------------------------------------------------------------------
One commenter argues that, because some agencies have authority to
make mandatory licensing conditions, interagency off-the-record
communications should be prohibited unless applicants have similar
access to the Commission.67 NARUC urges the Commission to
consider its statutory obligations for consultations with its member
state utility commissions, and clarify when communications with state
commissions are necessary.68 At least one state agency
believes that excluding party agencies from this exemption would chill
their ability to participate fully in some proceedings.69
Finally, it was suggested that communications with non-party Indian
Tribes be covered by this exemption.70
---------------------------------------------------------------------------
\67\ NHA at 2-3.
\68\ NARUC at 2-4.
\69\ California Oversight at 2.
\70\ Interior at 11-12.
---------------------------------------------------------------------------
The exemption, modeled on similar ex parte exemptions adopted by
the Federal Communications Commission (FCC), is adopted as
proposed.71 The intent is to recognize that, except when the
other Federal, state, or local agency is directly involved in a
Commission case as a party, the public interest favors a free flow of
information between government agencies with shared jurisdiction. Where
agencies are charged with shared jurisdiction and regulatory
responsibilities, a cohesive government policy can best be developed
and implemented through communication, cooperation and collaboration
between agencies and their staff that sometimes can take place most
effectively off-the-record.72 To ensure that such
communications do not compromise the procedural rights of the parties
or the integrity of the Commission's decisional record, the exemption
as proposed and adopted includes a disclosure provision, requiring that
information obtained through off-the-record communications with
Federal, state or local agencies, and relied upon by the Commission in
reaching its decision, be placed in the public record to allow the
public to discern the basis of the Commission's decision.
---------------------------------------------------------------------------
\71\ See, e.g., 47 CFR 1.1204(a)(5).
\72\ Similar exclusions appear in the Federal Communications
Commission's ex parte regulations. See 47 CFR 1.1204(b)(5), (7) and
(8).
---------------------------------------------------------------------------
We do not believe it appropriate to require disclosure of
communications between the Commission and non-party cooperating
agencies that exchange views and information in the development of an
environmental impact statement or environmental assessment under NEPA.
Such cooperation typically involves an interagency sharing of the staff
work necessary to prepare an environmental document. This collaboration
is most
[[Page 51229]]
effective when not burdened by notice and disclosure requirements.
Where the involved agencies are not parties before the Commission, we
believe this collaboration can occur off-the-record without prejudice
to the parties. Thus, the final rule excludes such communications from
the disclosure requirements.
(6) Off-the-Record Communications Relating to NEPA Documentation
The NOPR proposed to exclude from the general prohibitions of this
rule all off-the-record communications relating to the preparation of
either an environmental impact statement (EIS) or an environmental
assessment (EA) where the Commission has determined to solicit public
comment on the EA. Under the proposed exemption, off-the-record
communications would be permitted by the rule if they are made prior to
the issuance of a final NEPA document. The proposed exemption provided
for notice and disclosure of off-the-record communications.
Several commenters would limit application of the exemption to off-
the-record communications leading up to the issuance of a draft
environmental impact statement (DEIS) and require all communications
occurring after issuance of the DEIS to take place on the
record.73 One commenter expresses concern that if the
Commission adopts the rule as proposed, permitting off-the-record
communications during the period between issuance of a DEIS and final
environmental impact statement (FEIS), an applicant might learn of
post-DEIS comments only upon issuance of the final environmental
document, thus denying it an opportunity to respond. Accordingly, this
commenter asks that, should the Commission permit off-the-record
communications until issuance of the FEIS, such communications should
be immediately disclosed and parties should be allowed to comment on
the substance of the communication prior to the Commission addressing
such communication in the FEIS.74
---------------------------------------------------------------------------
\73\ E.g. INGAA at 4-5, NHA at 3-4, SMUD at 8.
\74\ INGAA at 4-5.
---------------------------------------------------------------------------
Federal agency commenters enthusiastically support this exemption
and would broaden it to allow communications related to areas within
their jurisdictional expertise even after a FEIS issues.75
They cite statutory obligations such as, but not limited to, the Clean
Water Act,76 Endangered Species Act,77 and
National Historic Preservation Act of 1966,78 as requiring
input from their respective agencies even after the Commission issues
its decisions. Furthermore, CEQ regulations require that Federal
agencies integrate related surveys, required by other relevant
environmental review laws, into an EIS.79
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\75\ Interior at 12, NMFS at 4-5, ACHP at 1-2, BPA at 4-10, CEQ
at 1.
\76\ 33 U.S.C. 1251, et seq.
\77\ 16 U.S.C. 1632, et seq.
\78\ 16 U.S.C. 470, et seq.
\79\ Such statutes include, but are not limited to, the Coastal
Zone Management Act of 1972, 16 U.S.C. 1451 et seq.; National
Historic Preservation Act of 1966, 16 U.S.C. 470 et seq.; Endangered
Species Act, 16 U.S.C. 1532 et seq.; and section 401, the Clean
Water Act, 33 U.S.C. 1341.
---------------------------------------------------------------------------
Another commenter responds that government agencies that are also
parties to a proceeding should not have access to materials under
circumstances where other parties lack such access, but that a
disclosure requirement would alleviate such concerns.80 One
commenter responds that there is no need to share confidential trade
secret information with agencies in order to prepare an environmental
document.81
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\80\ Williston at 6.
\81\ SoCalEd at 2.
---------------------------------------------------------------------------
The Commission basically adopts the exemption in the final rule as
proposed in the NOPR. The Commission appreciates the concerns raised by
the commenters, both those supporting narrowing the scope of the
exemption, and those supporting broadening its scope, but we do not
believe that they require us to make changes to the rule as proposed.
While the Commission prefers that all NEPA-related communications take
place on the record, we acknowledge that there will be times when off-
the-record contacts may assist in the development of sound
environmental analysis.
The public NEPA process provides sufficient opportunity for
interested persons to fully participate in the development of the
environmental document that will be part of the Commission's record of
decision. In proceedings where the preparation of an EIS is necessary,
CEQ rules describe a public scoping requirement that may include
noticed, public, on-the-record meetings, and require that all
substantive comments (whether written or oral) received on the DEIS, or
summaries thereof, where the response has been especially voluminous,
should be addressed in the final environmental document, whether or not
they are relied upon by the agency.82 Just as with the
development of an EIS, CEQ regulations provide that, to the extent
practicable, environmental agencies, the applicant, environmental
interest groups, and the public should be involved in the process of
crafting an EA.83 Thus, the process of NEPA document
preparation is an open one, with ample opportunities for public
participation.
---------------------------------------------------------------------------
\82\ 40 CFR 1503.4(b).
\83\ 40 CFR 1501.4.
---------------------------------------------------------------------------
The final rule adopts a notice and disclosure requirement. The
disclosure requirement provides that any written communication, and a
summary of any oral communication obtained through an exempted off-the-
record communication to or from Commission staff, will be promptly
placed in the decisional record of the proceeding, and noticed by the
Secretary.84 Thus, interested persons will have notice of
comments received on a NEPA document and be given the opportunity to
respond. Such a practice will enhance the openness of the NEPA process
and allow the Commission to make the most informed decisions
practicable.
---------------------------------------------------------------------------
\84\ As discussed above, the notice and disclosure requirements
do not apply to communications with non-party cooperating agencies.
See 18 CFR 385.2201(g)(1).
---------------------------------------------------------------------------
Finally, there were two comments related to the timing of this
exemption. One commenter asks the Commission to clarify when this
exemption would be in effect: from the time an application is received,
or from the time of notice that the application is ready for
environmental analysis? 85 The CEQ regulations suggest that
the environmental analysis process start at the earliest possible time,
including the possibility that such preparation start before an
application is filed with an agency.86 This exemption will
be triggered by the filing of an application, and remain in effect no
later than the date on which the final environmental document (either
FEIS or Finding of No Significant Impact) is issued.
---------------------------------------------------------------------------
\85\ Interior at 12.
\86\ See, e.g., 40 CFR 1501.2.
---------------------------------------------------------------------------
The second commenter suggests that the exemption provide for
disclosure of an off-the-record communication within ten days of the
communication.87 We believe that the general provision
requiring disclosure promptly after receipt is appropriate, and is
included in the final rule. While the final rule adopts the exemption
for off-the-record communications relating to contested proceedings
that require the preparation of environmental documents, any off-the-
record communications relevant to the merits taking place after the
Commission's issuance of the final environmental document will be
considered prohibited ex parte communications under the final rule,
unless covered by another exemption.
---------------------------------------------------------------------------
\87\ SMUD at 8.
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[[Page 51230]]
(7) Off-the Record Communications With Individual Non-Party Landowners
Subject to a disclosure requirement, the NOPR proposed, and the
final rule permits, off-the-record communications with non-party
landowners whose property may be affected by a pending proceeding.
Several commenters oppose this exemption and suggest that all
landowner communications should be filed and served on all
parties.88 Other commenters suggest that while some
exemption for landowner communications is appropriate, such
communications should be limited in number or restricted to those
owners whose property is or will be affected by an action over which
the Commission has statutory authority.89 Another commenter
notes that the Commission's Landowner Notification proposal
90 was intended to make it easier for landowners to
participate in proceedings that directly affect them. This commenter
asks the Commission to clarify, in this proceeding, when an individual
landowner is or is not a party, who may comment without intervening,
and whether these landowners need to be served filings by parties to
the proceeding.91
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\88\ E.g., HRC at 7, NGSA at 11.
\89\ Joint Commenters at 12, BPA at 7.
\90\ See ``Landowner Notification, Expanded Categorical
Exclusions and Other Environmental Filing Requirements,'' Docket No.
RM98-17-000 64 FR 27717 (May 21, 1999), IV FERC Stats & Regs. ]
32,540 (Apr. 28, 1999).
\91\ Williston at 5.
---------------------------------------------------------------------------
This non-party landowner exemption does not apply to landowners who
have intervened as a party to a proceeding. Such a party will be
treated as any other party to a contested Commission proceeding.
Landowners desiring to become parties may do so in the same manner as
any other person desiring to do so: By filing an application or timely
intervention or opposition to the proceeding, or at such time the
Commission accepts a request to file out of time. Once a landowner
becomes a party to a proceeding, all communications between the
landowner and the Commission must be made on-the-record and served on
all parties to the proceeding. As an intervenor, the landowner will be
placed on the service list and will receive copies of all documents of
record. Also as an intervenor, the landowner has the right to seek
rehearing of any Commission order, and to appeal any final Commission
action.
During the NEPA process, landowner comments (as well as comments by
others) are placed in the record and, to the extent required by CEQ
regulations, responded to in any final environmental document. For
purposes of preparing an environmental impact statement or an
environmental assessment, such commenters are not deemed to be
intervenors, absent their having formally intervened as a party
pursuant to the Commission's procedural rules. Thus, they do not
receive documents of record, nor do they have the right to seek
rehearing or appeal of Commission orders. On the other hand, they do
not have the burden of serving copies of their comments on all parties
on the service list.
The exemption provides an opportunity for individuals who may not
have the knowledge of Commission practice and procedure to obtain
information from the Commission. The Commission is concerned that in
spite of its efforts and those of applicants, many landowners may
remain unaware that a project directly affects their property until the
time for intervention in a proceeding has passed. A non-party landowner
should be able to contact the Commission to determine what is going on
and how to participate in the proceeding if he or she so chooses.
Further, if a landowner decides not to intervene, that landowner should
be permitted to comment without the need to incur the expense of
formally intervening in a proceeding. Any possible bias to the parties
is mitigated by the notice and disclosure requirement that off-the-
record communications with affected landowners be placed in the record
of the proceeding and made available for review and comment. While the
Commission agrees that an individual non-party landowner should not
have an unlimited number of contacts, we believe that it is preferable
to rely on the sound judgment of the Commission and its staff to
prevent abuse rather than setting ``bright line'' restrictions on the
number of such contacts.
In addition, only those non-party landowners whose property would
be used by or whose property abuts property that would be used by the
proposed project would qualify for the exemption. This exemption
applies throughout the course of the proceeding, even after the NEPA
process has been completed, but does not apply to landowner
organizations, or to individual landowners who are parties to the
proceeding.
E. Proposed Exemptions Not Adopted in the Final Rule
As indicated above, three of the ten exemptions proposed in the
NOPR are not included as exemptions in the final rule.
(1) Pre-filing Communications Outside the Scope of the Final Rule
The NOPR proposed an exemption that would have permitted off-the-
record communications relating to ``pre-filing communications,
including communications under Secs. 4.34(i), 4.38 and 16.8 of this
chapter, to take place before the filing of an application for an
original, new, nonpower, or subsequent hydropower license or exemption
or a license amendment.'' A clarifying note added that application of
this exemption is not limited to the referenced hydropower regulations,
but would also include the submission of draft rate schedules for the
purpose of receiving suggestions under Sec. 35.6 of the Commission's
rules, and certain informal pipeline certificate consultations pursuant
to Sec. 157.14(a). Further, the Commission has always encouraged pre-
filings by oil pipeline companies. In our work on streamlining the oil
regulations in Order No. 561,92 we specifically included
Sec. 341.12, ``Informal Submissions,'' to allow for this. In addition,
the NOPR anticipated additional initiatives permitting pre-filing
collaborative procedures designed to expedite the process of reviewing
applications subsequently filed with the Commission.
---------------------------------------------------------------------------
\92\ 58 FR 58753 (Nov. 4, 1993), FERC Stats. & Regs.
(Regulations Preambles 1991-1996) para. 30,985 (Oct. 22, 1993).
---------------------------------------------------------------------------
There is general support for this exemption; however, several
commenters argue in favor of setting conditions on allowing pre-filing
communications to take place off-the-record.93 As noted by
other commenters, however, pre-filing communications generally fall
outside the scope of the APA's definition of ex parte.94
Except for mandating that ex parte provisions take effect no later than
the date a matter is noticed for hearing, the APA leaves to the
individual agency the decision as to whether ex parte proscriptions
should attach at an earlier date.95 The Commission views
pre-filing
[[Page 51231]]
communications as harmonious with the APA and, consistent with our past
practice, does not believe that any bar to communications should exist
prior to the time a matter is formally contested, let alone prior to
the time a matter is filed for its consideration.
---------------------------------------------------------------------------
\93\ E.g., SCSI at 4 (supports as long as pre-filing
consultations do not address merits of the proceeding to be filed);
WPPI at 6-7 (if adopted, permitted communications should be limited
to procedure and precedent, and be disclosed); NGSA at 10 (favors
exemption but reminds Commission that its decision must be based on
record evidence, not pre-filing communications).
\94\ HRC at 4, Interior at 5 (requests that the rule reference
need for certain interagency communications).
\95\ See, 5 U.S.C. 557(d)(1)(E). It should be noted, however,
that the APA requires that, when the agency knows that the matter
will be set for hearing, ex parte prohibitions should be enforced at
that point.
---------------------------------------------------------------------------
We agree with the commenters' assertion that there is no need to
provide an exemption for pre-filing communications, as such
communications fall outside this rule's applicability. Accordingly,
this exemption is deleted from the final rule.96
---------------------------------------------------------------------------
\96\ Even though we find that pre-filing communications fall
outside the scope of this rule, we are nonetheless sensitive to the
concerns expressed by some commenters regarding communications that
take place before an application is filed. The Commission's pre-
filing collaborative procedures address these concerns, typically
with communications protocols.
---------------------------------------------------------------------------
(2) Consideration of Published or Widely Disseminated Public
Information
As articulated in the NOPR, the Commission proposed this exemption
to allow the Commission to consider publicly available information such
as speeches, articles, and other published or widely disseminated
information that may have a bearing on the issues involved in a
contested proceeding. For example, Commission staff should be able to
consult various regulated companies' electronic bulletin boards such as
OASIS sites in order to obtain market information. The Commission can
take official notice of that information in making its determination in
the contested case. Independent research such as this does not qualify
as an ex parte communication. This policy is not intended to encourage
parties to forward for Commission consideration any published or
otherwise broadly disseminated information in any manner other than on-
the-record.
Commenters acknowledge that the Commission may take notice of
public domain information but urge that parties not be permitted to
provide such information to a decisional employee without formal
notice.97 It was also argued that exercising judicial notice
is appropriate as long as the Commission identifies and allows parties
a chance to rebut any such information it relies upon, and that the
Commission clarify that the exemption applies to the document and not
to direct communications with its makers.98
---------------------------------------------------------------------------
\97\ ACHP at 3.
\98\ NGSA at 9.
---------------------------------------------------------------------------
We agree with the commenters' assertions. However, we do not
believe that a specific exemption is necessary to allow the Commission
to access and consider in its decision making process any publicly
available, widely disseminated materials. Independent research or fact
gathering where no oral or written communication is exchanged does not
qualify as a communication. Nor do we believe that a specific exemption
is warranted to permit parties the opportunity to forward such
information for Commission consideration off-the-record. Accordingly,
we do not believe that a specific exemption is required for off-the-
record communications of published or widely disseminated public
information, and this exemption is deleted from the final rule. To the
extent persons outside the Commission wish to communicate publicly
available information in contexts not otherwise exempt under the rule,
those communications must take place on-the-record.
(3) Off-the-Record Communications Concerning Non-Contested Compliance
Matters
The NOPR proposed an exemption for certain staff communications
concerning compliance matters where the compliance issue is not a
subject of the rehearing. We note that several commenters supporting
this exemption suggested that it be subject to a disclosure
requirement.99 Two commenters opposed lifting any
restrictions on off-the-record communications relating to compliance,
preferring that all such communications take place on the record.
100 It also was suggested that the exemption be limited to
matters concerning environmental and safety concerns as well as to
routine audits, and would require that the communication be disclosed
with an opportunity for comment.101
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\99\ E.g., HRC at 7; INGAA at 10; Interior at 10; Indicated
Shippers at 10, NGSA at 5.
\100\ NMFS at 4 (suggesting that its role in compliance matters
could be adversely affected if it is not provided prior notice of
communications between the Commission and the licensee); WPPI at 5-
6.
\101\ Indicated Shippers at 10.
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The Commission does not believe that a specific exemption is needed
to allow the sort of off-the-record communications we envisioned as
being permitted by this proposed exemption. If a compliance matter is
unrelated to a pending rehearing, it is no longer subject to an on-
going Commission proceeding, and communications related to such matters
are not relevant to the merits and, therefore, are not subject to the
rule in any case. In order to clarify our intent, the definition of
``relevant to the merits'' has been modified to expressly exclude
``communications relating to compliance matters not the subject of an
ongoing proceeding.'' With this definitional change, the proposed
exemption is not included in the final rule.
Under the final rule, if a hydropower licensee or certificate
holder is having difficulty complying with a particular condition
imposed by the Commission in its order authorizing the subject
facility, and the licensing or certification order is pending rehearing
on issues unrelated to compliance issues, the licensee or certificate
holder and the Commission may engage in off-the-record communications
necessary solely to resolve issues related to the mechanics of
compliance. However, communications relating to the need for the
particular condition would be considered as relevant to the merits and
would have to take place on the record.102
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\102\ In this example, should the permitted communication result
in a conclusion that the condition cannot practicably be met, the
licensee would have to seek an amendment to its license, which must
be on-the-record, subject to comment by all parties to the
proceeding.
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F. Application of the Prohibitions on Off-The-Record Communications
The final rule generally follows the proposed rule, stating that
the prohibitions on off-the-record communications do not apply prior to
the initiation of a proceeding at the Commission. The rule's
proscriptions apply: For proceedings initiated by the Commission--from
the time an order initiating the proceeding is issued; for proceedings
returned to the Commission on judicial remand--from the date the court
issues its mandate; for complaints initiated pursuant to Rule 206
103--from the date of the filing of the complaint with the
Commission, or the date the Commission initiates an investigation, on
its own motion; and for all other proceedings--from the time of the
filing of an intervention disputing any material issue that is the
subject of a proceeding.
---------------------------------------------------------------------------
\103\ 18 CFR 385.206.
---------------------------------------------------------------------------
As discussed above, pre-filing communications are not governed by
this rule. With respect to licenses and certificates, even though pre-
filing communications are not prohibited under the provisions of this
rule, our intent and preference is that pre-filing protocols will
continue to be used as an element of our collaborative pre-filing
procedures.
Several commenters suggest that the Commission should presume that
all docketed matters will be contested and,
[[Page 51232]]
therefore, the prohibition on off-the-record communications should be
in effect from the time of filing of an application until the time for
interventions and protests has expired. If no opposing pleading has
been filed by that time, the Commission could then notice that
communications may take place off-the-record.104 Another
commenter requests that the Commission announce that ex parte
provisions have been triggered at the same time it announces receipt of
any filing. 105
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\104\ Indicated Shippers at 7, WPPI at 3.
\105\ Interior at 15.
---------------------------------------------------------------------------
The Commission is not adopting these suggestions. The thrust of
these comments would be to begin the prohibition on ex parte contacts
as soon as an application is filed with the Commission. This would mean
that there could be no off-the-record communications about any
proceeding docketed by the Commission--a result that the Commission
finds is too restrictive and is not required by law. To trigger the
rule upon application, for example, could prevent the Commission from
efficiently obtaining important information necessary to cure an
incomplete filing.
As noted above, the prohibitions on off-the-record communications
will typically be triggered by the filing of a protest or an
intervention that disputes any material issue in an application for
Commission action, not by the filing of the application itself. Because
a properly filed intervention is recorded on the docket sheet and is
available on other public electronic information retrieval systems
maintained by the Commission and should be served by the maker on the
parties, the Commission does not believe it is necessary to formally
notice in any individual proceeding when the prohibitions on off-the-
record communications are in effect. However, the Commission will
explore electronic tools for indicating, perhaps on the docket sheet,
when the prohibitions on off-the-record communications have been
triggered.
Once triggered, the prohibitions against off-the-record
communications remain in effect until the time for rehearing has
expired and no party has filed for rehearing, or the Commission has
disposed of all petitions for rehearing or clarification, or the
proceeding is otherwise terminated or is no longer contested. If the
Commission order is subject to judicial review which results in a
remand, the prohibitions against off-the-record communications once
again apply when the court issues its mandate remanding the matter to
the Commission.
One commenter suggested that the prohibitions should remain in
effect during judicial review.106 This commenter's concern
was that, in the event of a remand, whether voluntarily requested by
the Commission or as a result of judicial review, information
communicated while the proceeding is before the court by the parties to
the case to Commission staff defending the Commission's orders could be
improperly used to prejudice any Commission action on
remand.107
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\106\ Indicated Shippers at 7-9.
\107\ Id.
---------------------------------------------------------------------------
The final rule does not adopt this suggestion. During judicial
review, there is no matter pending before the Commission that would
trigger the ex parte communication prohibitions of the APA. During the
judicial review process, the record of the Commission's proceedings is
closed. In the event of a remand, any further Commission action would
be required to be based on that existing record or on additions made to
that record after remand and the reopening of the record. As the rule's
prohibitions would once again apply on remand, any additional matter
made part of the record would be admitted under the protections of the
rule.
G. Handling Prohibited Off-The-Record Communications
The final rule, as did the proposed rule, differentiates between
two types of off-the-record communications: those prohibited by the
regulations, and those permitted by the regulations under specific
exemptions. This section sets forth the treatment for prohibited off-
the-record communications under the regulations, while the next section
addresses the handling of exempted off-the-record communications.
The NOPR proposed to depart from the prior Rule 2201,108
but not the APA, by dropping the requirement that submissions to the
public, non-decisional file revealing prohibited off-the-record
communications must be served on the parties to the proceeding. The
proposed substitution of public notice, rather than requiring the
Commission to make individual service on all parties to a proceeding,
was modeled on the approach used in the FCC's ex parte rule with regard
to off-the-record communications.109
---------------------------------------------------------------------------
\108\ 18 CFR 385.2201.
\109\ 47 CFR 1.1206(b).
---------------------------------------------------------------------------
Comments received on this provision of the rule express concern
about the adequacy of notice, with a number of commenters arguing that
mere ``bulletin board'' posting is insufficient notice.110
However, several other commenters argue that, although merely posting a
notice on the Commission's bulletin board is not sufficient, proper
notice could be accomplished electronically through the Internet,
electronic mail, or by posting the notice on the Commission's web
page.111 The final rule reflects these comments. In
addition, in the case of a prohibited off-the-record written
communication, the final rule requires the Secretary to instruct the
author to directly serve the document on all parties listed on the
Commission's official service list.
---------------------------------------------------------------------------
\110\ E.g., NHA at 4-5, Interior at 16-17, EEI, at 4, HRC at 8.
``Bulletin board'' posting in this context means the posting of a
paper document on a public bulletin board at Commission
headquarters.
\111\ See, e.g., INGAA at 9, BPA at 7, Williams at 2-3,
Williston at 6-10.
---------------------------------------------------------------------------
Commission decisional employees who make or receive a prohibited
off-the-record communication relevant to the merits of a contested on-
the-record proceeding, are obligated to deliver a copy of the
communication, if written, or a summary of the substance of any oral
communication, to the Secretary for submission into a public, non-
decisional file associated with the decisional record in the
proceeding. This obligation must be met promptly after the prohibited
off-the-record communication occurs.
The final rule, under Rule 2201(h),112 requires the
Secretary to issue a public notice, at least as often as every 14 days,
of the receipt of any prohibited off-the-record communications. Such
notice will list the maker of the prohibited off-the-record
communication, date of receipt by the Commission, and the docket number
to which the prohibited off-the-record communication relates. The
notice also will state that the prohibited, off-the-record
communication will not be considered by the Commission.
---------------------------------------------------------------------------
\112\ 18 CFR 385.2201(h).
---------------------------------------------------------------------------
Parties to a proceeding may seek an opportunity to respond on the
record to any facts or contentions made in a communication and placed
in the non-decisional file, and may request that the Commission include
the prohibited off-the-record communication and responses thereto in
the public decisional record, as well. The Commission will grant such
requests only when it determines that fairness so requires. If the
request is granted, a copy of the off-the-record communication and the
permitted on-the-record response will be made a part of the decisional
record.
The public notice will appear on the Commission's web page in a
place
[[Page 51233]]
designated for such notices. The notice will describe the prohibited
off-the-record communication in sufficient detail to allow interested
persons to ascertain whether it is of interest and how it may be
accessed through RIMS or some other means. In addition, the Secretary
will periodically, but not less than every 14 days, publish in the
Federal Register a list of prohibited off-the-record communications.
H. Handling Exempted Off-The-Record Communications
Many of the exemptions to the final rule require notice and
disclosure of off-the-record communications permitted under their
terms. Because the exemptions require notice and disclosure of off-the-
record communications that are relevant to the merits, one commenter
asks that when the Secretary notices an exempted off-the-record
communication, whether written or oral, such notice provide details of
the contact, such as the related docket number, maker, time and place
of a communication, and a summary of the substance of the
communication.113 Because this section addresses exempted,
rather than prohibited communications, this commenter believes that it
is very important that notice of the communication be made promptly so
as to allow time for a meaningful response.114
---------------------------------------------------------------------------
\113\ HRC at 8-9.
\114\ Id.
---------------------------------------------------------------------------
These comments have merit. Exempted off-the-record communications
subject to a disclosure requirement will be placed in the decisional
record and may be used by the Commission in coming to a decision on the
merits in a proceeding. Accordingly, such communications must be
available for review by all parties to the proceeding, and there must
be an efficient and effective method for noticing the receipt of such
off-the-record communications and making such off-the-record
communications available for public inspection and comment. In the case
of exempted off-the-record communications, prompt electronic notice
through an electronic service list will be made and the document will
be made available through the Commission's public automated information
retrieval systems.
J. Notice of Prohibited and Exempted Off-The-Record Communications
The NOPR had two different subsections regarding notice of off-the-
record communications. Rule 2201(f)(2) required notice of prohibited,
off-the-record communications, and Rule 2201(g)(2) required notice of
permitted off-the-record communications.115 The final rule
consolidates these two subsections into final Rule 2201(h): ``Public
notice requirement of prohibited and exempted off-the-record
communications.''
---------------------------------------------------------------------------
\115\ The comments relating to the notice requirements were
discussed in the previous section.
---------------------------------------------------------------------------
K. Sanctions for Making Prohibited, Off-The-Record Communications
The final rule adopts the NOPR's proposed sanctions. Any party or
its agent who knowingly makes or causes to be made prohibited off-the-
record communications may be required to show cause why its claim or
interest should not be dismissed, disregarded, or otherwise adversely
affected because of the improper communication. This particular
sanction is already found in our existing ex parte
regulation,116 and mirrors that provided for in the APA
itself.117 An additional sanction subjects to possible
suspension or disbarment from practice before the Commission, any
individual knowingly making or causing to be made, prohibited off-the-
record communications. The final rule allows the Commission to take
action against the representative of a party to a proceeding, the party
itself, or both. In those rare instances where a party uses attorneys
or other representatives who repeatedly violate Commission procedures,
both the party and the individual offender may be subject to Commission
disciplinary measures.
---------------------------------------------------------------------------
\116\ 18 CFR 385.2201(f).
\117\ 5 U.S.C. 557(d)(1)(D).
---------------------------------------------------------------------------
The general view of the commenters is that the existing ex parte
sanction, coupled with Rule 2102 on suspensions from practice before
the Commission,118 is already sufficient to dissuade
individuals from engaging in improper off-the-record
communications.119 One commenter argues that the sanctions
set forth in the NOPR seem disproportionate and may discourage contact
with the Commission.120
---------------------------------------------------------------------------
\118\ 18 CFR 385.2102
\119\ See, e.g., NGSA at 12.
\120\ Indicated Shippers at 14-15.
---------------------------------------------------------------------------
To the extent the commenters support the new sanctions, they
suggest making clear that this section should be applied in only the
most egregious cases, e.g., repeated violations by the same person, and
then only after due process requirements have been
satisfied.121 The Commission also is urged not to invoke
sanctions for inadvertent violations, and to assure that the sanction
of disqualification would apply to an individual representing a party
to a proceeding and not the party itself.122
---------------------------------------------------------------------------
\121\ Id. See also Process Gas at 6, EEI at 13,.
\122\ NGSA at 12.
---------------------------------------------------------------------------
The final rule retains the sanctions as proposed. In so doing, we
acknowledge the overlap with this provision and Rule
2102.123 The ex parte sanctions are intended to clarify that
persons who engage in prohibited communications are subject to
sanctions for the violation of the rule. The final rule properly
provides that knowing and willful violations of the prohibitions could
result in suspension or disbarment pursuant to the provisions of Rule
2102.
---------------------------------------------------------------------------
\123\ 18 CFR 385.2102.
---------------------------------------------------------------------------
One commenter suggests that the final rule provide that those
Commission employees who violate these provisions should be subject to
the Commission's disciplinary procedures.124 The
Commission's standards of conduct 125 and administrative
directives 126 provide that staff who violate its rules are
subject to sanctions ranging from admonishment to removal from Federal
service, depending on the severity of the violation. One intent of the
revisions to the existing ex parte rule is to clarify that the
prohibitions apply to communications by Commission decisional employees
as well as to communications from persons outside the Commission.
Accordingly, the final rule includes a provision that Commission
personnel violating this rule may be subject to Commission disciplinary
action.
---------------------------------------------------------------------------
\124\ INGAA at 11.
\125\ 18 CFR 385.3c
\126\ Federal Energy Regulatory Commission, Administrative
Directive 3-7B (FERC Work Force Discipline Program).
---------------------------------------------------------------------------
IV. Regulatory Flexibility Certification Statement
The Regulatory Flexibility Act 127 requires rulemakings
either to contain a description and analysis of the impact the rule
would have on small entities, or to certify that the rule will not have
a significant economic impact on a substantial number of small
entities. An analysis is not required if a proposed rule will not have
such an impact.128
---------------------------------------------------------------------------
\127\ 5 U.S.C. 601-612.
\128\ 5 U.S.C. 605(b).
---------------------------------------------------------------------------
The regulations proposed in this rulemaking would revise the
Commission's rules of practice and procedure dealing with certain off-
the-record communications. The Commission certifies that this final
rule will not have a significant economic impact on small entities.
V. Environmental Statement
Commission regulations require that an environmental assessment or
an
[[Page 51234]]
environmental impact statement be prepared for any Commission action
that may have a significant adverse effect on the human
environment.129 The Commission has categorically excluded
certain actions from this requirement as not having a significant
effect on the human environment. Among these are proposals for rules
that are procedural.130 The final rule falls under this
exception; consequently, no environmental consideration is necessary.
---------------------------------------------------------------------------
\129\ 18 CFR part 380.
\130\ 18 CFR 380.4(a)(2)(ii).
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VI. Information Collection Statement
The Office of Management and Budget's (OMB's) regulations require
that OMB approve certain information collection requirements imposed by
agency rules.131 However, this final rule contains no
information collection requirements and therefore is not subject to OMB
approval.
---------------------------------------------------------------------------
\131\ 5 CFR part 1320.
---------------------------------------------------------------------------
VII. Congressional Review and Effective Date
The provisions of 5 U.S.C. 801, regarding Congressional review of
rulemakings, do not apply to this rulemaking because it concerns agency
procedure and practice and will not substantially affect the rights and
obligations of non-agency parties.132
---------------------------------------------------------------------------
\132\ 5 U.S.C. 804(3)(C).
---------------------------------------------------------------------------
The rule is effective October 22, 1999.
List of Subjects in 18 CFR Part 385
Administrative practice and procedure, Electric Power, Penalties,
Pipelines, and Reporting and record keeping requirements.
By the Commission.
David P. Boergers,
Secretary.
In consideration of the foregoing, the Commission amends part 385,
chapter I, Title 18, Code of Federal Regulations, as follows:
PART 385--RULES OF PRACTICE AND PROCEDURE
1. The authority citation for part 385 continues to read as
follows:
Authority: 5 U.S.C.551-557; 15 U.S.C. 717-717w, 3301-3432; 16
U.S.C. 791a-825r, 2601-2645; 31 U.S.C. 9701; 42 U.S.C. 7101-7352; 49
U.S.C. 60502; 49 App. U.S.C. 1-85.
Sec. 385.101 [Amended]
2. In Sec. 385.101, remove paragraph (b)(4)(ii), and redesignate
paragraph (b)(4)(i) as (b)(4).
3. Section 385.915 is revised to read as follows:
Sec. 385.915 Off-the-record communications (Rule 915).
The provisions of Rule 2201 (prohibited communications and other
communications requiring disclosure) apply to proceedings pursuant to
this subpart, commencing at the time the Secretary issues a proposed
remedial order under 10 CFR 205.192, an interim remedial order for
immediate compliance under 10 CFR 205.199D, or a proposed order of
disallowance under 10 CFR 205.199E.
4. Section 385.1012 is revised to read as follows:
Sec. 385.1012 Off-the-record communications (Rule 1012).
The provisions of Rule 2201 (prohibited communications and other
communications requiring disclosure) apply to proceedings pursuant to
this subpart, commencing at the time a petitioner files a petition for
review under Rule 1004 (commencement of proceedings).
Sec. 385.1415 [Removed]
5. Section 385.1415 is removed.
6. The heading of Subpart V is revised to read as follows:
Subpart V--Off-the-Record Communications; Separation of Functions
7. Section 385.2201 is revised to read as follows:
Sec. 385.2201 Rules governing off-the-record communications. (Rule
2201).
(a) Purpose and scope. This section governs off-the-record
communications with the Commission in a manner that permits fully
informed decision making by the Commission while ensuring the integrity
and fairness of the Commission's decisional process. This rule will
apply to all contested on-the-record proceedings, except that the
Commission may, by rule or order, modify any provision of this subpart,
as it applies to all or part of a proceeding, to the extent permitted
by law.
(b) General rule prohibiting off-the-record communications. Except
as permitted in paragraph (e) of this section, in any contested on-the-
record proceeding, no person shall make or knowingly cause to be made
to any decisional employee, and no decisional employee shall make or
knowingly cause to be made to any person, any off-the-record
communication.
(c) Definitions. For purposes of this section:
(1) Contested on-the-record proceeding means
(i) Except as provided in paragraph (c)(1)(ii) of this section, any
proceeding before the Commission to which there is a right to intervene
and in which an intervenor disputes any material issue, or any
proceeding initiated by the Commission on its own motion or in response
to a filing.
(ii) The term does not include notice-and-comment rulemakings under
5 U.S.C. 553, investigations under part 1b of this chapter, proceedings
not having a party or parties, or any proceeding in which no party
disputes any material issue.
(2) Contractor means a direct Commission contractor and its
subcontractors, or a third-party contractor and its subcontractors,
working subject to Commission supervision and control.
(3) Decisional employee means a Commissioner or member of his or
her personal staff, an administrative law judge, or any other employee
of the Commission, or contractor, who is or may reasonably be expected
to be involved in the decisional process of a proceeding, but does not
include an employee designated as part of the Commission's trial staff
in a proceeding, a settlement judge appointed under Rule 603, a neutral
(other than an arbitrator) under Rule 604 in an alternative dispute
resolution proceeding, or an employee designated as being non-
decisional in a proceeding.
(4) Off-the-record communication means any communication relevant
to the merits of a contested on-the-record proceeding that, if written,
is not filed with the Secretary and not served on the parties to the
proceeding in accordance with Rule 2010, or if oral, is made without
reasonable prior notice to the parties to the proceeding and without
the opportunity for such parties to be present when the communication
is made.
(5) Relevant to the merits means capable of affecting the outcome
of a proceeding, or of influencing a decision, or providing an
opportunity to influence a decision, on any issue in the proceeding,
but does not include:
(i) Procedural inquiries, such as a request for information
relating solely to the status of a proceeding, unless the inquiry
states or implies a preference for a particular party or position, or
is otherwise intended, directly or indirectly, to address the merits or
influence the outcome of a proceeding;
(ii) A general background or broad policy discussion involving an
industry or a substantial segment of an industry, where the discussion
occurs outside the context of any particular proceeding involving a
party or parties and does not address the specific merits of the
proceeding; or,
[[Page 51235]]
(iii) Communications relating to compliance matters not the subject
of an ongoing proceeding.
(d) Applicability of prohibitions.
(1) The prohibitions in paragraph (b) of this section apply to:
(i) Proceedings initiated by the Commission from the time an order
initiating the proceeding is issued;
(ii) Proceedings returned to the Commission on judicial remand from
the date the court issues its mandate;
(iii) Complaints initiated pursuant to rule 206 from the date of
the filing of the complaint with the Commission, or the date the
Commission initiates an investigation, (other than an investigation
under part 1b of this chapter), on its own motion; and
(iv) All other proceedings from the time of the filing of an
intervention disputing any material issue that is the subject of a
proceeding.
(2) The prohibitions remain in force until:
(i) A final Commission decision or other final order disposing of
the merits of the proceeding or, when applicable, after the time for
seeking rehearing of a final Commission decision, or other final order
disposing of the merits expires;
(ii) The Commission otherwise terminates the proceeding; or
(iii) The proceeding is no longer contested.
(e) Exempt off-the-record communications.
(1) Except as provided by paragraph (e)(2) of this section, the
general prohibitions in paragraph (b) of this section do not apply to:
(i) An off-the-record communication permitted by law and authorized
by the Commission;
(ii) An off-the-record communication made by a person outside of
the agency related to an emergency subject to disclosure under
paragraph (g) of this section;
(iii) An off-the-record communication provided for in a written
agreement among all parties to a proceeding that has been approved by
the Commission;
(iv) An off-the-record written communication from a non-party
elected official, subject to disclosure under paragraph (g) of this
section;
(v) An off-the-record communication to or from a Federal, state,
local or Tribal agency that is not a party in the Commission
proceeding, subject to disclosure under paragraph (g) of this section,
if the communication involves:
(A) An oral or written request for information made by the
Commission or Commission staff; or
(B) A matter over which the Federal, state, local, or Tribal agency
and the Commission share jurisdiction, including authority to impose or
recommend conditions in connection with a Commission license,
certificate, or exemption;
(vi) An off-the-record communication, subject to disclosure under
paragraph (g) of this section, that relates to:
(A) The preparation of an environmental impact statement if
communications occur prior to the issuance of the final environmental
impact statement; or
(B) The preparation of an environmental assessment where the
Commission has determined to solicit public comment on the
environmental assessment, if such communications occur prior to the
issuance of the final environmental document.
(ii) An off-the-record communication involving individual
landowners who are not parties to the proceeding and whose property
would be used or abuts property that would be used by the project that
is the subject of the proceeding, subject to disclosure under paragraph
(g) of this section.
(2) Except as may be provided by Commission order in a proceeding
to which this subpart applies, the exceptions listed under paragraph
(e)(1) of this section, will not apply to any off-the-record
communications made to or by a presiding officer in any proceeding set
for hearing under subpart E of this part.
(f) Treatment of prohibited off-the-record communications.--(1)
Commission consideration. Prohibited off-the-record communications will
not be considered part of the record for decision in the applicable
Commission proceeding, except to the extent that the Commission by
order determines otherwise.
(2) Disclosure requirement. Any decisional employee who makes or
receives a prohibited off-the-record communication will promptly submit
to the Secretary that communication, if written, or, a summary of the
substance of that communication, if oral. The Secretary will place the
communication or the summary in the public file associated with, but
not part of, the decisional record of the proceeding.
(3) Responses to prohibited off-the-record communications. Any
party may file a response to a prohibited off-the-record communication
placed in the public file under paragraph (f)(2)of this section. A
party may also file a written request to have the prohibited off-the-
record communication and the response included in the decisional record
of the proceeding. The communication and the response will be made a
part of the decisional record if the request is granted by the
Commission.
(4) Service of prohibited off-the-record communications. The
Secretary will instruct any person making a prohibited written off-the-
record communication to serve the document, pursuant to Rule 2010, on
all parties listed on the Commission's official service list for the
applicable proceeding.
(g) Disclosure of exempt off-the-record communications. (1) Any
document, or a summary of the substance of any oral communication,
obtained through an exempt off-the-record communication under
paragraphs (e)(1)(ii), (iv), (v), (vi) or (vii) of this section,
promptly will be submitted to the Secretary and placed in the
decisional record of the relevant Commission proceeding, unless the
communication was with a cooperating agency as described by 40 CFR
1501.6, made under paragraph (e)(1)(v) of this section.
(2) Any person may respond to an exempted off-the-record
communication.
(h) Public notice requirement of prohibited and exempt off-the-
record communications. (1) The Secretary will, not less than every 14
days, issue a public notice listing any prohibited off-the-record
communications or summaries of the communication received by his or her
office. For each prohibited off-the-record communication the Secretary
has placed in the non-decisional public file under paragraph (f)(1) of
this section, the notice will identify the maker of the off-the-record
communication, the date the off-the-record communication was received,
and the docket number to which it relates.
(2) The Secretary will not less than every 14 days, issue a public
notice listing any exempt off-the-record communications or summaries of
the communication received by the Secretary for inclusion in the
decisional record and required to be disclosed under paragraph (g)(1)
of this section.
(3) The public notice required under this paragraph (h) will be
posted in accordance with Sec. 388.106 of this chapter, as well as
published in the Federal Register, and disseminated through any other
means as the Commission deems appropriate.
(i) Sanctions. (1) If a party or its agent or representative
knowingly makes or causes to be made a prohibited off-the-record
communication, the Commission may require the party, agent, or
representative to show cause why the party's claim or interest in the
proceeding should not be dismissed, denied, disregarded, or otherwise
adversely affected because of the
[[Page 51236]]
prohibited off-the-record communication.
(2) If a person knowingly makes or causes to be made a prohibited
off-the-record communication, the Commission may disqualify and deny
the person, temporarily or permanently, the privilege of practicing or
appearing before it, in accordance with Rule 2102 (Suspension).
(3) Commission employees who are found to have knowingly violated
this rule may be subject to the disciplinary actions prescribed by the
agency's administrative directives.
(j) Section not exclusive. (1) The Commission may, by rule or
order, modify any provision of this section as it applies to all or
part of a proceeding, to the extent permitted by law.
(2) The provisions of this section are not intended to limit the
authority of a decisional employee to decline to engage in permitted
off-the-record communications, or where not required by any law,
statute or regulation, to make a public disclosure of any exempted off-
the-record communication.
8. The heading of Sec. 385.2202 is revised to read as follows:
Sec. 385.2202 Separation of Functions (Rule 2202).
Note: This Appendix will not appear in the Code of Federal Regulations
Appendix A--List of Commenters
Adirondack Mountain Club
Advisory Council on Historic Preservation (ACHP)
American Gas Association (AGA)
ANR Pipeline Company/Colorado Interstate Gas Company (ANR/CIG)
Bonneville Power Administration (BPA)
California Electric Oversight Board (Cal Board)
Chevron Pipe Line Company (Chevron)
Edison Electric Institute (EEI)
Electric Power Supply Association (EPSA)
Environmental Protection Agency (EPA)
Executive Office of the President/Council on Environmental Quality
(CEQ)
Hydropower Reform Coalition (HRC)
Indicated Shippers
Interstate Natural Gas Association of America (INGAA)
Louisiana Department of Wildlife And Fisheries (La W&F)
National Association of Regulatory Utility Commissioners (NARUC)
National Marine Fisheries Services (NMFS)
National Hydropower Association (NHA)
National Rural Electric Cooperative Association/American
Public Power Supply Association (Joint Commenters)
Natural Gas Supply Association (NGSA)
Public Service Commission of New York (PSCNY)
Public Utilities Commission of State of California (PUCCAL)
Public Utilities Commission of State of California/Independent (Cal-
ISO) System Operator
Process Gas Consumers Group (Process Gas)
Sacramento Municipal Utilities District (SMUD)
Sempra Energy Companies (Sempra)
Southern California Edison Company (SoCalEd)
Southern Companies Services, Inc. (SCSI)
Southern Natural Gas Company (SoNat)
United States Department of the Interior (Interior)
Williams Companies (Williams)
Williston Basin Interstate Pipeline Company (Williston)
Wisconsin Public Power, Inc. (WPPI)
[FR Doc. 99-24616 Filed 9-21-99; 8:45 am]
BILLING CODE 6717-01-P