Appeal from the United States District Court for the District of South Carolina, at Columbia. Charles E. Simons, Jr., Senior District Judge. CA-85-1155.
Hall and Wilkinson, Circuit Judges, and Doumar, United States District Judge for the Eastern District of Virginia, sitting by designation.
In this case the Sierra Club (appellant) seeks judicial review of certain agency action conducted by the Federal Highway Administration (FHWA) and the United States Department of Transportation (appellees). The Sierra Club appeals the decision by the district court granting appellees' motion for judgment on the pleadings and finding that the agency action in question was not subject to judicial review. We affirm.
Originally, the Sierra Club sought declaratory and injunctive relief against the FHWA and the United States Department of Transportation in the United States District Court for the Northern District of Georgia. The appellant alleged that the appellees had failed to enforce provisions of the Highway Beautification Act (HBA or Act), 23 U.S.C. § 131, regarding outdoor advertising in South Carolina. The district court dismissed appellant's complaint, holding that appellees' discretionary authority under the Act was precluded from judicial review under the terms of the statute and the doctrine of prosecutorial discretion. Sierra Club appealed this decision to the Eleventh Circuit which vacated and remanded to the district court to transfer the case to the United States District Court for the District of South Carolina for further proceedings. In so ruling the Eleventh Circuit held that joinder of South Carolina as a party to the lawsuit was required in order to obtain complete relief, avoid multiple litigation over a single issue and to effectuate congressional intent. Sierra Club v. Leathers, 754 F.2d 952 (11th Cir. 1985).
Once transferred, appellant filed an amended complaint by which the state of South Carolina was added. Appellees' motion for judgment on the pleadings was granted based on the district court's finding that the FHWA made a decision not to undertake enforcement proceedings against South Carolina and that this decision was committed to agency discretion by law and not subject to judicial review because there was no law to apply. The district court relied on Heckler v. Chaney, 470 U.S. 821, 105 S. Ct. 1649, 84 L. Ed. 2d 714 (1985), in making its decision. This appeal followed.
Pursuant to the HBA, each state that participates in its highway beautification program is responsible for enforcing the requirements of the Act by exercising "effective control" over outdoor advertising. The requirements are defined by the Act, federal regulations and an agreement entered into between the state and the Secretary of Transportation (Secretary). It is up to the Secretary, acting through the FHWA, to monitor compliance. 23 C.F.R. § 1.37 (1983); 49 C.F.R. § 1.48(b)(21), (c)(11) (1982). If the Secretary determines, based on recommendations from the FHWA Administrator, that a state is not maintaining "effective control," she may institute formal enforcement proceedings and ultimately withhold 10% of federal highway funds until compliance is achieved. 23 U.S.C. § 131(b). However, if the Secretary determines it to be "in the public interest" she may suspend the withholding of funds. 23 U.S.C. § 131(b). The withholding decisions and the decision to commence enforcement proceedings are reserved exclusively to the Secretary, but the FHWA initially seeks compliance through less formal means. 49 C.F.R. § 1.44(j) (1982).
The regulations authorize the FHWA Administrator to delegate to Division and Regional offices the initial duty to make investigations and consult with state officials when violations are suspected. 49 C.F.R. § 1.45(b) (1982). The Division may recommend to the Regional Administrator that enforcement proceedings commence. The Regional Administrator may conduct more informal proceedings and/or make recommendations to the FHWA Administrator. The Administrator may issue a warning letter as a final step before recommending to the Secretary that enforcement proceedings commence. The Secretary may make more informal gestures before deciding whether to institute proceedings. If proceedings are instituted, and the decision is adverse to the state, and the Secretary does not waive the fund penalty, the state may appeal to a federal court. 23 U.S.C. § 131(l). The statute and regulations do not mandate that enforcement actions be taken by anyone in this chain, and only the Secretary may make the decision to proceed with enforcement. This is usually done only after all informal means fail.
In early 1981, the FHWA conducted a fact-finding investigation in South Carolina, based partially on complaints by Dr. Charles Floyd, Chairman of the Department of Real Estate and Urban Development, University of Georgia. The resultant report indicated that South Carolina was not maintaining "effective control" over its outdoor advertising and recommended that corrective steps be taken. On September 9, 1981, the Regional Administrator advised Dr. Floyd by letter that the report was merely a draft which he had now reviewed. He declined to take any further corrective action because he was "satisfied with actions already taken or planned courses of action by South Carolina . . . in assuring compliance with federal requirements for outdoor advertising." The letter addressed numerous points and outlined steps taken or planned to be taken by the state and FHWA to correct problems. He noted finally that the FHWA was undertaking an "overall assessment of the outdoor advertising program throughout this region." On January 7, 1982, the Regional Administrator wrote Dr. Floyd to notify him that the overall assessment was complete and had resulted in the development of Regional policy on four issues and that no further action, outside routine monitoring, would be taken.
Review of the Secretary's action in this case is sought under the provisions of the Administrative Procedure Act (APA), 5 U.S.C. §§ 551 et seq., which provides for review of final agency actions. "Agency actions" are defined to include "the whole or a part of an agency rule, order, license, sanction, relief, or the equivalent or denial thereof, or failure to act . . ." 5 U.S.C. § 551(13). Both an agency's failure to act and its affirmative actions are subject to review. However, the APA provides two exceptions to judicial review in § 701(a). These occur when the "(1) statutes ...