Portland Pipe Line Corporation v. City of South Portland , 2020 ME 125 ( 2020 )


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  • MAINE SUPREME JUDICIAL COURT                                               Reporter of Decisions
    Decision: 
    2020 ME 125
    Docket:   Fed-20-40
    Argued:   September 16, 2020
    Decided:  October 29, 2020
    Panel:       MEAD, GORMAN, JABAR, HUMPHREY, and HORTON, JJ.
    PORTLAND PIPE LINE CORPORATION et al.
    v.
    CITY OF SOUTH PORTLAND et al.
    MEAD, J.
    [¶1] Portland Pipe Line Corporation’s (PPLC’s) plan to pipe crude oil
    from its facility in Canada to the City of South Portland, where it then would be
    loaded onto tankers in the City’s harbor, was thwarted when the City enacted a
    “Clear Skies Ordinance,” amending the City’s zoning ordinance by prohibiting
    the “[b]ulk loading of crude oil onto any marine vessel.” South Portland, Me.,
    Ordinance 1-14/15 § 3 (July 7, 2014); see Portland Pipe Line Corp. v. City of South
    Portland, 
    947 F.3d 11
    , 13-14 (1st Cir. 2020). After the United States District
    Court for the District of Maine (Woodcock, J.) entered summary judgment
    against PPLC and American Waterways Operators1 (collectively PPLC) on their
    1
    The complaint identifies American Waterways Operators as “the national trade association for
    the nation’s inland and coastal tugboat, towboat, and barge industry.”
    2
    complaint seeking a declaration that, inter alia, the Ordinance was preempted
    by 38 M.R.S. § 556 (2020), Portland Pipe Line Corp. v. City of South Portland,
    
    288 F. Supp. 3d 322
    , 456-58 (D. Me. 2017), PPLC appealed to the United States
    Court of Appeals for the First Circuit, which has certified three questions of
    state law to us pursuant to 4 M.R.S. § 57 (2020) and M.R. App. P. 25:
    (1) Is PPLC’s license an “order,” as that term is used in [38 M.R.S.]
    § 556?
    (2) If PPLC’s license is an order, is the City of South Portland’s Clear
    Skies Ordinance preempted by [38 M.R.S.] § 556 of Maine’s Coastal
    Conveyance Act?
    (3) Independent of [38 M.R.S.] § 556, is there any basis for finding
    that Maine’s Coastal Conveyance Act impliedly preempts the City of
    South Portland’s Clear Skies Ordinance?
    Portland Pipe Line 
    Corp., 947 F.3d at 18-19
    .
    [¶2] We answer the first and third questions in the negative and decline
    to answer the second question.
    I. FACTS AND PROCEDURE
    [¶3] In its opinion certifying the three questions now before us, the Court
    of Appeals stated that the relevant facts and procedural background are
    “undisputed.”
    Id. at 13.
    For years, PPLC unloaded crude oil from ships in
    South Portland’s harbor, stored it in above-ground tanks, and then sent it via a
    largely underground pipeline to Montréal.
    Id. Due to a
    change in demand,
    3
    beginning in or around 2007, PPLC began to seek necessary approvals to
    reverse the flow of oil in the pipeline so that it could send oil from Montréal to
    South Portland and from there load it onto ships in the City’s harbor for
    distribution in the United States.
    Id. [¶4] After PPLC
    received approval for the change from the federal
    government
    , id., in 2010 the
    Maine Department of Environmental Protection
    (MDEP) renewed PPLC’s marine oil terminal facility license, originally issued in
    1979, noting that
    PPLC is proposing a change in its operations in the renewal
    application. PPLC is proposing to reverse one of its underground
    pipe lines to transport oil from its terminal in Montreal Canada to
    its terminal in South Portland, Maine. The oil would be stored in
    the above ground tanks prior to being loaded on vessels at the
    South Portland pier for transport to refineries and terminals
    outside the [S]tate of Maine.
    The City’s Planning Board also approved the change.
    Id. at 14
    . In a subsequent
    renewal of PPLC’s license, the MDEP restated that the license “allows PPLC to
    receive oil from Montreal, Canada by underground and aboveground pipe lines
    to the South Portland oil terminal facility for storage prior to being loaded onto
    vessels.”
    [¶5] Despite receiving regulatory approval in 2010, PPLC halted the
    reversal project, “choosing instead to wait out the economic decline
    4
    precipitated by the Great Recession.”
    Id. PPLC revived the
    project in 2012 and
    2013 as economic conditions improved, but the enactment of the Ordinance by
    the City in 2014 effectively halted further operations.
    Id. [¶6] In 2015,
    PPLC filed suit against the City and its code enforcement
    director (collectively the City) in the United States District Court for the District
    of Maine, seeking to bar enforcement of the Ordinance on largely federal
    grounds.
    Id. at 14
    & n.5. Relevant to the First Circuit’s certification, Count IX of
    the complaint alleged that the Ordinance is preempted by Maine’s Coastal
    Conveyance Act (the Act),2 38 M.R.S. §§ 541-560 (2020), specifically
    section 556 (the statute).3
    Id. [¶7] After the
    City unsuccessfully moved to dismiss the complaint, the
    parties filed cross-motions for summary judgment. Portland Pipe Line 
    Corp., 947 F.3d at 15
    . The District Court granted the City’s motion as to all but one
    count and entered summary judgment for the City on, inter alia, Count IX. Id.;
    see Portland Pipe Line 
    Corp., 288 F. Supp. 3d at 458
    -59. After the remaining
    2 The original enactment of the subchapter of the statutes now captioned “Oil Discharge
    Prevention and Pollution Control,” 38 M.R.S., subchapter 2-A, was entitled “An Act Relating to Coastal
    Conveyance of Petroleum.” P.L. 1969, ch. 572, § 1 (effective May 9, 1970). See Portland Pipe Line
    Corp. v. Env’t Improvement Comm’n, 
    307 A.2d 1
    , 8 (Me. 1973).
    3  Count VIII of the complaint, alleging that the Ordinance is inconsistent with the City’s
    comprehensive plan, see 30-A M.R.S. § 4352 (2020), is not at issue here. Portland Pipe Line Corp. v.
    City of South Portland, 
    947 F.3d 11
    , 14 n.5 (1st Cir. 2020).
    5
    count was dismissed following trial, PPLC appealed. Portland Pipe Line 
    Corp., 947 F.3d at 15
    .
    [¶8] Concluding that answers in the affirmative “would resolve the state
    law preemption claim [stated in Count IX] and this matter as a whole,” and that
    “the case lacks controlling precedent and presents close and difficult legal
    issues that warrant certification to the Law Court,”
    id. (alteration and quotation
    marks omitted), the First Circuit certified to us the three questions that we now
    address.
    Id. at 15, 18-19;
    supra ¶ 1.
    II. DISCUSSION
    A.    Acceptance of the Certified Questions
    [¶9] Because “4 M.R.S. § 57 authorizes, but does not require, us to
    consider a certified question of state law posed by a federal court in certain
    circumstances,” Scamman v. Shaw’s Supermarkets, Inc., 
    2017 ME 41
    , ¶ 7,
    
    157 A.3d 223
    (quotation marks omitted), “[a] threshold issue is whether we
    will agree to consider the certified questions,” Doherty v. Merck & Co., Inc.,
    
    2017 ME 19
    , ¶ 8, 
    154 A.3d 1202
    . We have said that
    we may consider the merits of a certified question from the [federal
    court] and, in our discretion, provide an answer if (1) there is no
    dispute as to the material facts at issue; (2) there is no clear
    controlling precedent; and (3) our answer, in at least one
    alternative, would be determinative of the case.
    6
    Doherty, 
    2017 ME 19
    , ¶ 8, 
    154 A.3d 1202
    (alteration and quotation marks
    omitted).
    [¶10]    Here, the First Circuit stated that the material facts are
    “undisputed” and that, were we to hold that Maine law preempts the Ordinance,
    that determination would “resolve . . . this matter as a whole.” Portland Pipe
    Line 
    Corp., 947 F.3d at 13
    , 15. We have not had occasion to construe 38 M.R.S.
    § 556. Accordingly, we agree to consider the certified questions. See Doherty,
    
    2017 ME 19
    , ¶ 8, 
    154 A.3d 1202
    .
    B.    Question One
    [¶11] The statute provides:
    Nothing in [the Coastal Conveyance Act] may be construed to deny
    any municipality, by ordinance or by law, from exercising police
    powers under any general or special Act; provided that ordinances
    and bylaws in furtherance of the intent of [the Act] and promoting
    the general welfare, public health and public safety are valid unless
    in direct conflict with [the Act] or any rule or order of the board or
    commissioner adopted under authority of [the Act].
    38 M.R.S. § 556. The first certified question asks us whether PPLC’s MDEP
    license is a Departmental “order” within the meaning of the statute.
    Portland Pipe Line 
    Corp., 947 F.3d at 18
    .
    [¶12] We conclude that it is not. That said, we note that the court’s
    certification went further than a request for a bare “yes” or “no” answer in
    7
    saying, “We would welcome further guidance from the Law Court on any other
    relevant aspect of Maine law that it believes would aid in the proper resolution
    of the issues before us.”
    Id. at 19.
    We accept the First Circuit’s invitation to
    expound on our answer to the first question because we also conclude that the
    Ordinance is not “in direct conflict with” the MDEP license granted to PPLC,
    even if the license were, arguendo, an “order.” 38 M.R.S. § 556.
    [¶13] The Legislature explicitly declared its intent in enacting the Coastal
    Conveyance Act:
    The Legislature intends by the enactment of this legislation to
    exercise the police power of the State through the Department of
    Environmental Protection by conferring upon the department the
    power to deal with the hazards and threats of danger and damage
    posed by [oil] transfers and related activities; to require the
    prompt containment and removal of pollution occasioned thereby;
    to provide procedures whereby persons suffering damage from
    those occurrences may be promptly made whole; and to establish
    a fund to provide for the inspection and supervision of those
    activities and guarantee the prompt payment of reasonable
    damage claims resulting therefrom.
    38 M.R.S. § 541. The Act further sets out the respective powers of the MDEP,
    the Board and Commissioner of Environmental Protection, and other state
    officials to effect that purpose. See 38 M.R.S. §§ 361-A(1-E), (1-G), 544-545,
    546-551, 552-A, 553, 555, 560 (2020).
    8
    [¶14] Nothing in the Ordinance is in “direct conflict” with the MDEP’s
    exercise of the State’s police power pursuant to the Act. 38 M.R.S. §§ 541,
    544-545, 556; see 20 Thames St. LLC v. Ocean State Job Lot of Me. 2017, LLC,
    
    2020 ME 55
    , ¶ 8, 
    231 A.3d 426
    (“In examining [a] statute . . . we construe its
    terms to give effect to the Legislature’s intent in enacting the statute.”
    (quotation marks omitted)). The Ordinance does not purport to require the
    MDEP to do anything that the Act says it may not do, nor does it bar the MDEP
    from doing what the Act says that it may do. The MDEP’s authority to set and
    enforce licensing standards through physical inspections and the examination
    of an applicant’s records is unchallenged.
    [¶15] Furthermore, as the District Court found, “it is not impossible to
    comply with both the Ordinance and the License.” Portland Pipe Line 
    Corp., 288 F. Supp. 3d at 458
    . The license permits, and the Ordinance does not forbid,
    transporting oil from the City’s harbor via pipeline to Canada as PPLC has
    always done. See Portland Pipe Line 
    Corp., 947 F.3d at 13
    .
    [¶16] Because there is no “direct conflict” between the Ordinance and
    the MDEP’s approval of PPLC’s compliance with Departmental standards for
    reversing the flow of oil in one of its pipelines, it is immaterial whether that
    approval is termed a “license” or an “order.” See 38 M.R.S. § 556. That said,
    9
    although that determination could end our inquiry, we think it necessary to
    address the first certified question directly, and in so doing we further conclude
    that PPLC’s license is not an “order” within the meaning of the statute.
    [¶17] The Ordinance bars a single activity that the MDEP’s approval
    allowed but did not require—loading crude oil from storage tanks onto marine
    tank vessels in the City’s harbor. Black’s Law Dictionary defines a “license” as
    “[a] permission.” License, Black’s Law Dictionary (11th ed. 2019); see also
    License, Merriam-Webster’s Collegiate Dictionary (11th ed. 2014) (defining a
    “license” as “permission to act”). The Legislature’s definition of “license” in
    Maine’s Administrative Procedure Act is consistent: “‘License’ includes . . . any
    agency permit, certificate, approval . . . or similar form of permission required
    by law . . . .” 5 M.R.S. § 8002(5) (2020) (emphasis added). In contrast, an “order”
    is “[a] command, direction, or instruction.” Order, Black’s Law Dictionary.
    “We . . . give [a] statute’s words their plain, common, and ordinary meaning,
    such as people of common intelligence would usually ascribe to them.”
    20 Thames St. LLC, 
    2020 ME 55
    , ¶ 8, 
    231 A.3d 426
    (quotation marks omitted).
    [¶18] Here, although the words “Department Order” appear in the
    header on the first page of the “Renewal License” issued to PPLC in 2010,4 the
    4  In contrast to the single use of “Department Order,” the words “Renewal License” appear on
    each page of the document.
    10
    license does not “command, direct[], or instruct[]” PPLC to do anything other
    than “fill rodent burrows and remove soil from the base of the [storage] tanks”
    before conducting permitted activities. See Order, Black’s Law Dictionary. That
    the license was not an “order” is demonstrated by the fact that PPLC, although
    authorized in 2010 to reverse the flow of oil in the pipeline, did not do so, but
    rather “[chose] instead to wait out the economic decline precipitated by the
    Great Recession.” Portland Pipe Line 
    Corp., 947 F.3d at 14
    . If the license were
    an “order,” PPLC would not have had the option to simply set it aside.
    [¶19] We conclude that the license PPLC received is not a Departmental
    “order” within the meaning of 38 M.R.S. § 556. It is more precisely a permit that
    allowed PPLC to reverse the flow of oil in the pipeline at its discretion—
    a permit that was granted through the procedural vehicle of an MDEP-issued
    order. For that reason, and because the Ordinance is not in “direct conflict” with
    the Act or the license, we answer question one in the negative.
    B.    Question Two
    [¶20] The second certified question is premised on an affirmative
    answer to question one. Portland Pipe Line 
    Corp., 947 F.3d at 18-19
    . Because
    we answer question one in the negative, we decline to answer the second
    certified question.
    11
    C.       Question Three
    [¶21] The third certified question asks us to determine whether the Act
    as a whole preempts the Ordinance by implication.
    Id. We conclude that
    it does
    not.
    [¶22] Maine’s Coastal Conveyance Act unambiguously declares that
    municipal ordinances concerning oil terminal facilities “are valid” unless they
    directly conflict with the Act or rules or orders made pursuant to it. 38 M.R.S.
    § 556. The Legislature made the presumption of a local ordinance’s validity
    particularly strong by explicitly invoking constitutional municipal home rule
    authority at the outset of the statute: “Nothing in [the Act] may be construed to
    deny any municipality, by ordinance . . . from exercising [its] police powers . . . .”
    Id.; see Me. Const. art. VIII, pt. 2, § 1; 30-A M.R.S. § 3001 (2020).5
    The “home rule” clause of the Maine Constitution provides: “The inhabitants of any municipality
    5
    shall have the power to alter and amend their charters on all matters, not prohibited by Constitution
    or general law, which are local and municipal in character. The Legislature shall prescribe the
    procedure by which the municipality may so act.” Me. Const. art. VIII, pt. 2, § 1.
    The statute enabling the constitutional home rule guarantee provides:
    Any municipality, by the adoption, amendment or repeal of ordinances or bylaws,
    may exercise any power or function which the Legislature has power to confer upon
    it, which is not denied either expressly or by clear implication, and exercise any power
    or function granted to the municipality by the Constitution of Maine, general law or
    charter.
    1. Liberal construction. This section, being necessary for the welfare of the
    municipalities and their inhabitants, shall be liberally construed to effect its purposes.
    12
    [¶23] In Dubois Livestock, Inc. v. Town of Arundel, we said that
    [p]ursuant to the “home rule” provision of 30-A M.R.S. § 3001 . . .
    a municipality may exercise its authority to adopt an ordinance if
    that power is not denied either expressly or by clear implication
    under state law. Local ordinances are presumptively valid,
    30-A M.R.S. § 3001(2), and an ordinance will be invalidated only
    when the Legislature has expressly prohibited local regulation, or
    when the Legislature has intended to occupy the field and the
    municipal legislation would frustrate the purpose of a state law.
    Accordingly, an ordinance will be preempted only when state law
    is interpreted to create a comprehensive and exclusive regulatory
    scheme inconsistent with the local action or when the municipal
    ordinance prevents the efficient accomplishment of a defined state
    purpose.
    
    2014 ME 122
    , ¶ 13, 
    103 A.3d 556
    (alteration and quotation marks omitted),
    superseded in part by statute, 30-A M.R.S. § 2691(4) (2020), as recognized in
    Paradis v. Town of Peru, 
    2015 ME 54
    , ¶ 7, 
    115 A.3d 610
    ; see E. Perry Iron & Metal
    Co., Inc. v. City of Portland, 
    2008 ME 10
    , ¶ 14, 
    941 A.2d 457
    ; City of Bangor v.
    Diva’s, Inc., 
    2003 ME 51
    , ¶¶ 21, 24, 
    830 A.2d 898
    . The Legislature’s grant of
    home rule authority, grounded in the Maine Constitution, see Me. Const.
    2. Presumption of authority. There is a rebuttable presumption that any
    ordinance enacted under this section is a valid exercise of a municipality’s home rule
    authority.
    3. Standard of preemption. The Legislature shall not be held to have implicitly
    denied any power granted to municipalities under this section unless the municipal
    ordinance in question would frustrate the purpose of any state law.
    ....
    30-A M.R.S. § 3001 (2020).
    13
    art. VIII, pt. 2, § 1, “shall be liberally construed to effect its purposes.”
    30-A M.R.S. § 3001(1).
    [¶24] Here, far from being “expressly prohibited,” Dubois Livestock, Inc.,
    
    2014 ME 122
    , ¶ 13, 
    103 A.3d 556
    (quotation marks omitted), the City’s home
    rule authority to enact the Ordinance is expressly recognized and affirmed by
    Maine’s Coastal Conveyance Act. 38 M.R.S. § 556. The Act also establishes that
    the Legislature did not intend to occupy the field; to the contrary, it explicitly
    declares that the Ordinance “[is] valid” except in one narrow circumstance—
    a “direct conflict” with the Act or a rule or order adopted pursuant to the Act.
    Id. Further, the MDEP
    anticipated local regulation when it issued a license
    conditioned on PPLC’s fulfillment of its obligation to “secure and comply with
    all applicable . . . local licenses [and] permits . . . prior to . . . operation.”
    (Emphasis added.)
    [¶25] Finally, the Ordinance does not “frustrate the purpose of a state
    law” or “prevent[] the efficient accomplishment of a defined state purpose,”
    Dubois Livestock, Inc., 
    2014 ME 122
    , ¶ 13, 
    103 A.3d 556
    (quotation marks
    omitted); see 30-A M.R.S. § 3001(3), because the foundational purposes of the
    Act and the Ordinance are the same. In setting out the purpose of the Act, the
    Legislature stated that it
    14
    finds and declares that the highest and best uses of the seacoast of
    the State are as a source of public and private recreation and solace
    from the pressures of an industrialized society, and as a source of
    public use and private commerce in fishing, lobstering and
    gathering other marine life used and useful in food production and
    other commercial activities.
    The Legislature further finds and declares that the
    preservation of these uses is a matter of the highest urgency and
    priority . . . .
    The Legislature further finds and declares that the transfer
    of oil, petroleum products and their by-products between vessels
    and vessels and onshore facilities . . . are hazardous undertakings;
    that spills, discharges and escape of oil, petroleum products and
    their by-products occurring as a result of procedures involved in
    the transfer, storage and other handling of such products pose
    threats of great danger and damage to the marine, estuarine, inland
    surface water and adjacent terrestrial environment of the State; to
    owners and users of shorefront property; to public and private
    recreation; to citizens of the State and other interests deriving
    livelihood from marine and inland surface water related activities;
    and to the beauty of the Maine coast and inland waters; that such
    hazards have frequently occurred in the past, are occurring now
    and present future threats of potentially catastrophic proportions,
    all of which are expressly declared to be inimical to the paramount
    interests of the State as set forth in this [Act] . . . .
    38 M.R.S. § 541. The declared purpose of the Ordinance dovetails with the
    stated purpose of the Act:
    This Ordinance is enacted, consistent with the City’s traditional
    land use authority, to protect the health and welfare of its residents
    and visitors and to promote future development consistent with
    the City’s Comprehensive Plan by prohibiting within the City the
    bulk loading of crude oil onto marine tank vessels, and also by
    prohibiting construction or installation of related facilities,
    15
    structures, or equipment that would create significant new sources
    of air pollution, adversely impact or obstruct ocean views and
    scenic view-sheds, and impede or adversely impact the City’s land
    use and planning goals.
    South Portland, Me., Ordinance 1-14/15 § 2.
    [¶26] Because in enacting 38 M.R.S. § 556 the Legislature expressly
    recognized municipalities’ authority to exercise their police power and in so
    doing made clear that it did not intend to occupy the field in this area, and
    because the Ordinance does not conflict with the purpose of the Act, the strong
    presumption that the Ordinance is valid remains. Id.; see 30-A M.R.S. § 3001;
    Dubois Livestock, Inc., 
    2014 ME 122
    , ¶ 13, 
    103 A.3d 556
    . Accordingly, the Act
    does not preempt the statute by implication, and we answer the third certified
    question in the negative.
    The entry is:
    We answer the certified questions as follows:
    “We answer the first and third certified
    questions in the negative. We decline to answer
    the second certified question.”
    16
    John J. Aromando, Esq., Matthew D. Manahan, Esq., and Nolan L. Reichl, Esq.
    (orally), Pierce Atwood LLP, Portland, for appellants Portland Pipe Line
    Corporation and American Waterways Operators
    Sally J. Daggett, Esq., Jensen Baird Gardner & Henry, Portland, and Jonathan M.
    Ettinger, Esq. (orally), Euripides Dalmanieras, Esq., and Jesse H. Alderman, Esq.,
    Foley Hoag LLP, Boston, Massachusetts, for appellees City of South Portland and
    Matthew LeConte
    Patrick Strawbridge, Esq., Consovoy McCarthy PLLC, Boston, Massachusetts, for
    amici curiae Chamber of Commerce of the United States of America, Portland
    Pilots, Inc., Maine Energy Marketers Association, Associated General
    Contractors of Maine, and Association of Oil Pipe Lines
    Aaron M. Frey, Attorney General, and Laura E. Jensen, Asst. Atty. Gen., Office of
    the Attorney General, Augusta, for amicus curiae State of Maine
    Susanne F. Pilgrim, Esq., Maine Municipal Association, Augusta, and Sarah J. Fox,
    Esq., Northern Illinois University College of Law, DeKalb, Illinois, for amici
    curiae International Municipal Lawyers Association, Sara Bronin, Nestor
    Davidson, Keith Hirokawa, Ashira Ostrow, Dave Owen, Laurie Reynolds,
    Jonathan Rosenbloom, and Sarah Schindler
    Sean Mahoney, Esq. and Phelps Turner, Esq., Conservation Law Foundation,
    Portland for amici curiae Conservation Law Foundation and Protect South
    Portland
    United States Court of Appeals for the First Circuit docket number 18-2118
    FOR CLERKS REFERENCE ONLY