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State ex rel. Missouri Coalition for Environment v. Joint Committee On Administrative Rules

Supreme Court of Missouri, En Banc

April 25, 2017

STATE OF MISSOURI ex rel. MISSOURI COALITION FOR THE ENVIRONMENT, et al., Appellants,
v.
JOINT COMMITTEE ON ADMINISTRATIVE RULES, et al., Respondents.

         Appeal from the Circuit Court of Cole County, Missouri Honorable Patricia S. Joyce, Judge

          LAURA DENVIR STITH, JUDGE.

         Plaintiffs appeal a judgment dismissing for mootness their action challenging the Joint Committee on Administrative Rules' (JCAR) authority to disapprove the "geographic sourcing" provisions of a 2010 rule promulgated by the Public Service Commission (PSC). Plaintiffs argue they are entitled to an order compelling the Secretary of State to issue a revised version of the 2010 rule that includes the geographic sourcing provisions. Alternatively, they argue the Court should require these provisions to be added to the 2015 rule that superseded the 2010 rule.

         This Court affirms the dismissal on mootness grounds without reaching the question of JCAR's authority to disapprove the portion of the 2010 rule in question. The PSC never published the geographic sourcing provisions at issue in this case, and they never became part of the 2010 rule. Moreover, while this case was pending in the trial court, the PSC issued an amended 2015 rule that did not include the geographic sourcing provisions of the 2010 rule in question here, and no challenge has been filed as to the 2015 rule. It is within the discretion of the PSC and the Secretary of State to issue an amended 2015 rule to supersede the 2010 rule. In light of the adoption of the 2015 rule, no purpose would be served by addressing JCAR's actions regarding a superseded prior rule. The trial court's judgment dismissing this case as moot is affirmed.

         I. BACKGROUND

         On November 4, 2008, the Missouri electorate approved Proposition C, which established renewable energy standards for investor-owned utilities. Proposition C later was codified as sections 393.1020-393.1030, RSMo Supp. 2010.[1] In January 2010, the PSC proposed regulations implementing Proposition C's renewable energy standards. The proposed regulations included provisions requiring electric corporations to achieve escalating percentages of their electricity sales with power obtained from renewable energy sources. Under the proposed regulations, utilities could demonstrate compliance with the statute by registering and retiring a sufficient number of "renewable energy credits"[2] representing renewable energy generated or purchased. 4 CSR 240-20.100(3). Subsections 240-20.100(2)(A) and (2)(B)2 of the proposed regulations, referred to as the "geographic sourcing provisions, " would have required the renewable energy credits to represent electricity that was "sold to Missouri customers." These geographic sourcing provisions form the focus of Plaintiffs' lawsuit.[3]

         When proposing a new rule, an agency must follow certain rulemaking procedures set out in title 36, chapter 536, RSMo. See §§ 536.021.1, 386.125. The agency must first file a notice of proposed rulemaking concurrently with the Secretary of State and with JCAR, and the notice shall be published in the Missouri Register as soon as practicable. §§ 536.021, 536.024.2, 536.073.5. The notice of proposed rulemaking must contain the entire text of the proposed rule and should specify a timeframe not less than 30 days after publication of the notice in the Missouri Register within which anyone may file a statement in support of or in opposition to the proposed rulemaking. § 536.021.2. The agency may also solicit comments from the public about the proposed rule before it files its final order of rulemaking. § 536.026. Normally, within 90 days after the end of the notice and comment period, "the state agency proposing the rule shall file with the Secretary of State a final order of rulemaking either adopting the proposed rule, with or without further changes, or withdrawing the proposed rule, which order of rulemaking shall be published in the Missouri Register." § 536.021.5. But the filing agency must first submit the final order of rulemaking to JCAR, and it cannot file the order with the Secretary of State until 30 days after such final order has been received by JCAR. § 536.024.3. During this 30-day period, JCAR may hold hearings on the final order of rulemaking. Id.

         No proposed rule can become effective without submission to JCAR, which has the authority to disapprove a rule in whole or in part. § 536.073. JCAR shall report any disapproved portion to the Missouri Senate and House of Representatives, and that portion shall not take effect if JCAR's action is ratified by resolution adopted in each house within 30 legislative days after JCAR's disapproval. § 536.073.9. Any portion of a proposed rule that is disapproved shall not formally be filed with the Secretary of State by the proposing agency or published by the agency in the Missouri Register. § 536.073.8.

         In this case, in January 2010, the PSC filed notice of the proposed rule with the Secretary of State and with JCAR in accordance with section 536.073.5. The text of this proposed rule included the geographic sourcing provisions, and it was published in the Missouri Register for notice and comment in February 2010 as required by section 536.021.1. 35 Mo. Reg. 365 (Feb. 10, 2010). After the comment period ended in June 2010, the PSC filed with JCAR a final order of rulemaking, including the two geographic sourcing provisions, pursuant to section 536.024. JCAR held hearings concerning the proposed rule and ultimately voted to disapprove the two geographic sourcing provisions on July 1, 2010. JCAR also sent a letter to the Secretary of State informing the Secretary of its action. A few days later, the PSC submitted a revised 2010 final order of rulemaking with the Secretary of State and with JCAR. The transmittal letter stated that as to the two geographic sourcing provisions, "in accordance with section 536.073.8, the Commission is not filing those sections for publication" with the remainder of the rule, so those provisions would not become effective. Instead, uncertain whether at some later point provisions addressing geographic sourcing might be needed, the PSC stated it was asking the Secretary of State to show subsections (2)(A) and (2)(B)2 as "reserved" for later use "in the event the Commission decides to amend the rule."

         On August 16, 2010, the Secretary of State published the revised final 2010 rule in the Missouri Register. 35 Mo. Reg. 1183 (Aug. 16, 2010). That published 2010 rule did not contain the geographic sourcing provisions. The revised 2010 rule became effective September 30, 2010. 4 CSR 240-20.100 (2010).

         At the end of January 2011, after the revised 2010 rule had already become effective, the PSC issued an "Order Withdrawing Geographic Sourcing Provisions (2)(A) and (2)(B)2 of 4 CSR 240-20.100 Pursuant to the Actions of JCAR" and stating that it had not presented the provisions to the Secretary of State and would not do so in the future. It further stated, "The Commission is withdrawing those provisions and again requests that [the geographic sourcing provisions] not be published or become effective." The order was not appealed and was published in the Missouri Register. 36 Mo. Reg. 1002-1007 (Apr. 1, 2011).

         When the legislature reconvened for the 2011 session, it passed Senate Concurrent Resolution No. 1, which disapproved the withdrawn geographic sourcing provisions. The Governor received the resolution but sent a letter to both chambers, stating he did not sign or veto it because the PSC order withdrawing the geographic sourcing provisions rendered the resolution moot.[4] The concurrent resolution and the letter from the Governor were published in the 2011 Missouri Register. 36 Mo. Reg. 1008-1011 (Apr. 1, 2011).

         More than two and one-half years later, in October 2013, Missouri Coalition for the Environment, Missouri Solar Applications, LLC, and Thomas J. Sager initiated an action against the Secretary of State, JCAR, the PSC, and the Governor, challenging JCAR's authority to disapprove the portions of the 2010 rule as first proposed and promulgated by the PSC. Plaintiffs recognized that sections 536.019, 536.021, and 536.073 authorize JCAR to disapprove any rule or portion of any rule filed by an agency but argued those statutes violate the separation of powers clause set out in article II, section 1, of the Missouri Constitution[5] to the extent they allow a legislative committee to suspend and veto administrative rules. Defendants argued the case was moot because the PSC voluntarily withdrew the geographic sourcing provisions before the 2010 rule was published. They also cite Missouri Coalition for the Environment v. Joint Committee on Administrative Rules, 948 S.W.2d 125, 134 (Mo. banc 1997), and allege any constitutional issue was resolved by section 536.073.9's requirement that the legislature pass a concurrent resolution approving any disapproval which shall be submitted to the Governor.

         The parties filed cross-motions for summary judgment. The trial court initially granted the PSC's motion. Plaintiffs appealed the decision to this Court, which dismissed the appeal because the judgment was not final as to all parties. Order Dismissing Appeal, State ex rel. Mo. Coal. for the Env't v. Joint Comm. on Admin. Rules, Case No. SC95100 (Mo. banc Nov. 17, 2015). In the meantime, the PSC was undertaking new rulemaking in accordance with chapter 536's rulemaking procedures. The proposed new rulemaking never contained geographic sourcing provisions. 40 Mo. Reg. 538-554 (May 1, 2015). After an appropriate notice and comment period and submission to JCAR and the Secretary of ...


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