Weintraub v. Rural Electrification Administration

In Weintraub v. Rural Electrification Administration, the Pennsylvania State Historic Preservation Officer and a private plaintiff alleged that the Rural Electrification Administration (REA) of the Department of Agriculture and two private corporations had violated Section 106 of the National Historic Preservation Act (NHPA) in planning and beginning demolition of the Telegraph Building, listed in the National Register of Historic Places. The building was owned by the two private corporations, which in turn were owned by cooperatives composed of utility companies that had borrowed money from REA. Although REA had not approved use of the loan funds for the proposed demolition and no Federal funds had been used or allocated for demolition, the cooperatives had used surplus funds from the loans to lend money to the corporations for the project.

The court denied plaintiffs' motion for a temporary restraining order. In considering plaintiffs' motion for a preliminary injunction, the court first found that the considerable interests involved in the preservation of historic resources put the question beyond the jurisdictional amount specified in 28 U.S.C. § 1331(a) and that the court therefore had subject matter jurisdiction over the case. The court also concluded that it had jurisdiction over the private defendants because of their association with REA.

Second, the court held that plaintiffs had standing to assert their claims. Plaintiffs had alleged that they or their members resided near the Telegraph Building and that the cultural and aesthetic well-being of the area would be damaged by demolition of the building. The court found that plaintiffs' interests were within the zone of interests intended for protection by NHPA.

The primary issue in the case, however, was whether there was sufficient Federal involvement in the demolition of the building to warrant application of Section 106. The court denied plaintiffs' motion for a preliminary injunction, finding that Congress intended only to control direct Federal spending and not to reach every effect of Federal spending when it made Section 106 applicable to the "approval of the expenditure of any Federal funds." The connection between the Federal spending and the action in this case was found to be too remote. Furthermore, REA's requirement that its borrowers receive its approval of plans for construction of certain buildings and REA's right to control the expenditures of surplus funds did not amount to a "license" within the meaning of Section 106. Rather, "license" refers to a "written document constituting a permission or right to engage in some governmentally supervised activity."

Therefore, the court concluded that NHPA did not apply to demolition of the Telegraph Building.