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Re: MWMC SDC Methodology and SDC Rates <br />Jun 22, 2004 <br />Page 3 <br /> <br />part of the writ of review statutes, therefore the "substantial evidence" test is the proper standard. <br />Pages 19-20. This analysis is incorrect. The tenn "arbitrary and capricious" is commonly 'used to <br />describe an abuse of discretion, which is the term used in Oregon administrative law. It refers to a <br />type of decision involving judgment, as distinguished from factual findings which must be supported <br />by substantial evidence. As Mr. Stamp acknowledges in other parts of his letter, developing a <br />methodology involves considerable discretion. Mr. Jewett's letter referred to the "exercise of <br />professional judgment inherent in selecting the conversion ratio" as not subject to review for <br />substantial evidence. That is correct, because matters of professional judgment necessarily are not <br />purely factual matters that can be proven or disproven by evidence. For decisions that depend <br />primarily on professional.judgment or a choice among competing policies, the court will not review <br />the exercise of judgment for substantial evidence. <br /> <br /> There are, of course, numerous l~actual determinations that underlie the Methodology. A <br />court would review those determinations to see if they are supported by substantial evidence in the <br />record. Mr. Stamp implies that the evidence to support those factual determinations must be in the <br />Methodology itself. See pages 22-24. In fact, the substantial evidence must be in the record, and <br />staff has provided voluminous information containing that evidence. <br /> <br />Other Issues <br /> <br /> Mr. Thorp's letter addresses a number of other issues pertaining to allocation of wet weather <br />flow costs, quality improvement costs, system valuation and other matters. In those areas, our <br />disagreement with Mr. Stamp's letter is less with the applicable legal standard than with technical <br />aspects of its application to the needed MWMC system improvements. Those issues involve <br />engineering expertise outside the scope of this legal memorandum. <br /> <br /> HARRANG LONG GARY RUDNICK P.e. <br /> - City Attorneys <br /> <br /> Jerome Lidz <br /> <br />JL:lke <br />J:'~e_main\00096\001 a\00089720 W PD <br /> <br /> <br />