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Arkansas Power & Light Co. v. Interstate Commerce Commission | 725 F.2d 716 (1984)

One of the key roles of federal agencies is to make rules. But what happens when an agency declines to make a rule? In Arkansas Power and Light Company versus Interstate Commerce Commission, we’ll see whether courts can compel agencies to institute rulemaking proceedings.

The Railroad Revitalization and Regulatory Reform Act and the Staggers Rail Act effectively ended federal regulatory control over railroads in the United States. The acts were passed to help establish reasonable rail rates through free competition. However, the Interstate Commerce Commission, or ICC, retained jurisdiction over areas where there was market dominance by a single operator. The Long Cannon Amendment to the Staggers Rail Act gave further protection to captive shippers, or shippers that must use railroads owned by a single operator. The amendment outlined that the ICC could regulate the rates that market dominant operators could charge for interstate commerce. Under a Long Cannon inquiry, the ICC would evaluate 3 different criteria, such as the impact that the proposed rate increase would have on national energy goals and other rail traffic criteria.

Arkansas Power and Light Company and other utility companies that transported coal via rail filed a petition with the ICC to institute rulemaking proceedings. The utility companies wanted the ICC to collect carrier specific data and create a rule that would outline what evidence would be relevant in a Long Cannon inquiry. The ICC refused to institute rulemaking proceedings. The ICC explained that collecting the requested data would be unnecessarily burdensome. Developing standards on a case by case basis through individual adjudications would be more efficient than creating a rule. There would also be adequate procedures in place for any party that needed to obtain the carrier specific data in an individual adjudication. The utility companies appealed to the United States Court of Appeals for the District of Columbia Circuit and sought review of the ICC’s decision to not create a rule.

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