First Iowa Hydro-Electric Cooperative v. FPC

In First Iowa Hydro-Electric Cooperative v. FPC (1946) 328 U.S. 152, the FPC was willing to approve a pending application for development of a hydroelectric project on the Cedar River, but the State of Iowa intervened to demand that the applicant first secure a state permit. The United States Supreme Court held that the state demand was preempted by the FPA: "To require the cooperative to secure the actual grant to it of a state permit ... as a condition precedent to securing a federal license for the same project ... would vest in ... Iowa a veto power over the federal project. Such a veto power easily could destroy the effectiveness of the Federal Act. It would subordinate to the control of the State the 'comprehensive' planning which the Act provides shall depend upon the judgment of the Federal Power Commission ... ." (First Iowa, supra, 328 U.S. 152, 164.) "A dual final authority, with a duplicate system of state permits and federal licenses required for each project, would be unworkable. 'Compliance with the requirements' of such a duplicated system of licensing would be nearly as bad. Conformity to both standards would be impossible in some cases and probably difficult in most of them." (Id. at p. 168.) The court then considered the scope of section 27 of the FPC, which then and now provides: "Nothing contained in this chapter shall be construed as affecting or intending to affect or in any way to interfere with the laws of the respective States relating to the control, appropriation, use, or distribution of water used in irrigation or for municipal or other uses, or any vested right acquired therein." (16 U.S.C. 821.) The court gave this provision a narrow construction: "The effect of 27, in protecting state laws from supersedure, is limited to laws as to the control, appropriation, use or distribution of water in irrigation or for municipal or other uses of the same nature. It therefore has primary, if not exclusive, reference to such proprietary rights. The phrase 'any vested right acquired therein' further emphasizes the application of the section to property rights. There is nothing in the paragraph to suggest a broader scope ... ." (First Iowa, supra, 328 U.S. 152, 175-176.) After describing the FPA as "a major undertaking" intended "to secure a comprehensive development of natural resources," the court concluded: "The detailed provisions of the Act providing for the federal plan of regulation leave no room or need for conflicting state controls." (First Iowa, supra, 328 U.S. 152, 180-181.)