Skinner v. Mid-America Pipeline Co., 490 U.S. 212 (1989)

Skinner v. Mid-America Pipeline Co.

No. 87-2098

Argued March 1, 1989
Decided April 25, 1989
490 U.S. 212

APPEAL FROM THE UNITED STATES DISTRICT COURT FOR THE

NORTHERN DISTRICT OF OKLAHOMA

Syllabus

Section 7005 of the Consolidated Onmibus Budget Reconciliation Act of 1985 (COBRA) directs the Secretary of Transportation (Secretary) to establish a schedule of pipeline safety user fees based on usage of hazardous pipelines and to collect such fees annually from persons operating pipeline facilities subject to the Hazardous Liquid Pipeline Safety Act of 1979 (HLPSA) and the Natural Gas Pipeline Safety Act of 1968 (NGPSA). Section 7005 -- designed to make the administration of the HLPSA and the NGPSA self-financing -- provides that the assessed fees be used to finance activities authorized by the HLPSA and the NGPSA, and that such fees may not exceed 105 percent of the aggregate of congressional appropriations for the fiscal year for activities to be funded by the fees. Pursuant to this mandate, the Secretary published fee schedules and assessed fees for fiscal year 1986. Appellee Mid-America Pipeline Co. -- which owns and operates pipelines that transport hazardous liquids and is, therefore, subject to the HLPSA -- paid its fees under protest and filed suit against the Secretary in the District Court for declaratory and injunctive relief. On cross-motions for summary judgment, the court adopted the conclusions of a Magistrate recommending that § 7005 be struck down as an unconstitutional delegation to the Department of Transportation of Congress’ taxing power on the grounds that the assessments were taxes, rather than fees, and that, in enacting § 7005, Congress did not give the kind of guidance to the Secretary necessary to avoid the conclusion that Congress had unconstitutionally delegated such power to the Executive Branch.

Held: Section 7005 of COBRA is not an unconstitutional delegation of the taxing power by Congress to the Executive Branch. Pp. 218-224.

(a) The multiple restrictions Congress placed on the Secretary’s discretion to assess user fees meet the normal requirements of the nondelegation doctrine, which requires that Congress provide an administrative agency with standards guiding its actions such that a court can ascertain whether the will of Congress has been obeyed. In enacting § 7005, Congress delimited the scope of the Secretary’s discretion with greater specificity than in other delegations this Court has upheld. The Secretary may not collect fees from firms not subject to either of the two Pipeline Safety Acts or use the funds for purposes other than administering such Acts; he may not set fees on a case-by-case basis, apply a fee-setting criteria other than one of those delineated by Congress, or establish a fee schedule that does not bear a reasonable relationship to these criteria, and he has no discretion to expand the budget for administering the Pipeline Safety Acts because of the 105 percent ceiling. Pp. 218-220.

(b) Even if the user fees are a form of taxation, neither the Constitution nor congressional practices require the application of a different and stricter nondelegation doctrine in cases where Congress delegates discretionary authority to the Executive under its taxing power. There is nothing in the placement of the Taxing Clause -- first in place among the powers of Congress enumerated in Art. I, § 8, of the Constitution -- that would distinguish the power to tax from other enumerated powers in terms of the scope and degree of authority that Congress may delegate to the Executive Branch to execute the laws. Moreover, the Origination Clause -- which requires that all revenue bills originate in the House of Representatives -- implies nothing about the scope of Congress’ power to delegate discretionary authority under its taxing power once a bill has been properly enacted. Even when enacting tax legislation with remarkable specificity, as it has done in the Internal Revenue Code, Congress has delegated the authority to prescribe, and to determine the retroactivity of, rules and regulations for enforcement of the Code. Congress relies on administrators and the courts to implement the legislative will, since it cannot be expected to anticipate every conceivable problem that can arise or carry out day-to-day oversight. Pp. 220-223.

(c) This Court’s decisions in National Cable Television Assn., Inc. v. United States, 415 U.S. 336, and FPC v. New England Power Co., 415 U.S. 345, are not to the contrary, since they stand only for the proposition that Congress must indicate clearly its intention to delegate to the Executive the discretionary authority to recover administrative costs not inuring directly to the benefit of regulated parties by imposing additional financial burdens, whether characterized as "fees" or "taxes," on those parties. Section 7005 explicitly reflects Congress’ intent that the total costs of administering the HLPSA and the NGPSA be recovered through assessment of charges on those regulated by the Acts. Pp. 223-223.

Reversed.

O’CONNOR, J., delivered the opinion for a unanimous Court.