FEDERAL POWER ACT

An act of Congress creating a federal licensing system administered by the Federal Energy Regulatory Commission (FERC) and requiring that a license be obtained for nonfederal hydroelectric projects proposing to use Navigable waters or federal lands. The act contains a clause modeled after a clause in the Reclamation Act of 1902 which disclaims any intent to affect state water rights law. Subsequently, in a number of decisions dating back to the 1940s, the U.S. Supreme Court held that the provisions of both the Reclamation Act and the Federal Power Act preempted inconsistent provisions of state law. Decisions under both acts found that these clauses were merely "saving clauses" which required the United States to follow minimal state procedural laws or to pay just compensation where vested non-federal water rights are taken. Later the Supreme Court overturned a number of its earlier decisions and required that the Bureau of Reclamation (USBR) comply with conditions in state water rights permits unless those conditions conflict with "clear Congressional directives." However, no such reversal of the Federal Power Act's provisions followed and more recent decisions (Sayles Hydro Association v. Maughan, February 1993) reinforced this fact by holding that federal law has "occupied the field," preventing any state regulation of federally licensed power projects other than determining proprietary water rights. This precedent has far-reaching implications over states' rights to regulate water projects and stream flows within their borders. There have been instances where holders of Federal Power Act licenses have claimed preemption from state safety of dams requirements, minimum stream flow requirements, and state designation of wild and scenic streams. Also see Equal Footing Doctrine (U.S. Constitution) and Public Trust Doctrine.