Keep Our Wells Clean v. DNREC ( 2020 )

IN THE SUPREME COURT OF THE STATE OF DELAWARE
KEEP OUR WELLS CLEAN, GAIL §
SALOMON, EUGENIA GRACE § No. 138, 2020
NAVITSKI, VLAD ERIC §
NAVITSKI, THOMAS DIORIO, §
LYNN TAYLOR-MILLER, § Court Below: Superior Court
CHARLIE MILLER, and VIRGINIA § of the State of Delaware
WEEKS, §
§
Plaintiffs Below, § C.A. No. S19A-07-002
Appellants, §
§
v. §
§
DELAWARE DEPARTMENT OF §
NATURAL RESOURCES AND §
ENVIRONMENTAL CONTROL, §
and ARTESIAN WASTEWATER, §
MANAGEMENT, INC., §
§
Defendants Below, §
Appellees. §
Submitted: October 7, 2020
Decided: December 15, 2020
Before SEITZ, Chief Justice; VAUGHN, and TRAYNOR, Justices.
Upon appeal from the Superior Court. AFFIRMED.
Kenneth T. Kristl, Esquire (argued), Environmental & Natural Resources Law
Clinic, Widener University Delaware Law School, Wilmington, Delaware; Attorney
for Plaintiffs-Appellants Keep Our Wells Clean, Gail Salomon, Eugenia Grace
Navitski, Vlad Eric Navitski, Thomas DiOrio, Lynn Taylor-Miller, Charlie Miller,
and Virginia Weeks.
Devera B. Scott, Esquire, and Kayli H. Spialter, Esquire (argued), Department of
Justice, Dover, Delaware; Attorneys for Defendant-Appellee Delaware Department
of Natural Resources and Environmental Control.
R. Judson Scaggs, Jr., Esquire, MORRIS, NICHOLS, ARSHT & TUNNELL LLP,
Wilmington, Delaware; Attorneys for Defendant-Appellee Artesian Wastewater
Management, Inc.
SEITZ, Chief Justice:
2
Before 2014, the Delaware Department of Natural Resources and
Environmental Control reviewed wastewater treatment facility construction permit
applications under regulations adopted in 1999. In 2014, DNREC revised its
regulations and adopted new requirements. In this appeal, we address whether
Artesian Wastewater Management, Inc.’s 2017 construction permit application,
which Artesian characterizes as an amendment to its existing 2013 wastewater
treatment facility construction permit, must comply with the new requirements of
the 2014 regulations. The Environmental Appeals Board and the Superior Court
decided Artesian did not have to comply with the new requirements. We agree and
affirm.
I.
To build and operate a wastewater treatment facility in Delaware, a developer
must secure two permits—one to construct and another to operate the facility. On
October 5, 2013, DNREC granted Artesian a construction permit for Phase I of the
Artesian Northern Sussex Regional Water Recharge Facility in Sussex County,
Delaware (“Sussex Facility”).1 Like other Delaware wastewater treatment facilities,
Artesian expected that the Sussex Facility would be used to treat domestic
wastewater from a proposed housing development in Milton with the option to
1
Unless otherwise stated, the facts are drawn from the Superior Court’s Opinion, Keep Our Wells
Clean v. Dep’t of Nat. Res. & Envtl. Control, C.A. No. S19A-07-002-ESB, 2020 WL 1320954(Del. Super. Ct. Mar. 19, 2020).
3
service other wastewater needs in the region. Artesian planned to collect and treat
effluent at the Sussex Facility and then spray the treated wastewater on privately-
owned agricultural land. The Sussex Facility would be constructed in three phases
with the final facility composed of a wastewater treatment plant with a 3 million
gallon per day capacity, storage ponds, and a spray operation on agricultural land.
Under Phase I of the construction, Artesian planned to build two storage ponds with
a 62 million gallon storage capacity, 608.9 acres of spray fields, and a wastewater
treatment plant to process up to 1 million gallons a day. As part of its 2013 permit
application, Artesian submitted hydrogeologic and soil investigation reports as
required by regulations adopted in 1999 (the “1999 Regulations”). DNREC
evaluated and approved the Phase I construction permit under the 1999 Regulations
(the “2013 Permit”).
With the 2013 Permit in hand, Artesian started construction of the Sussex
Facility. The Milton housing development, however, never materialized. To
salvage the project, Artesian contracted with Allen Harim Foods, which owns a
chicken processing plant in Sussex County, to use the plant’s treated food processing
wastewater for the spray irrigation. On May 10, 2017, Artesian filed another permit
application to construct a wastewater treatment facility (“2017 Permit Application”).
The 2017 Permit Application along with an amended design development report
included the following changes to the existing Phase I construction: (1) moving
4
wastewater treatment plant construction from Phase I to Phase II; (2) increasing the
estimated treatment capacity from 1 million gallons of domestic wastewater per day
to 1.5-2 million gallons per day; (3) building one 90 million gallon storage pond
rather than two 62 million gallon ponds; and (4) increasing the spray area from 608.9
acres to 762.7 acres out of the 1,700 acres of agricultural land leased for spray
irrigation.
In between 2013 when DNREC issued the 2013 Permit and 2017 when
Artesian submitted its 2017 Permit Application, DNREC adopted new wastewater
regulations (“2014 Regulations”).2 Under the 2014 Regulations, in addition to the
hydrogeologic and soil investigation reports required by the 1999 Regulations,
permit applicants must submit a Hydrogeologic Suitability Report (“HSR”) and a
Surface Water Assessment Report (“SWAR”) before DNREC will review a
construction permit application. 3 Artesian’s 2017 Permit Application did not
include an HSR or SWAR.
DNREC reviewed Artesian’s 2017 Permit Application and found it
administratively complete—meaning it contained all the required submissions and
2
Regulations Governing the Design, Installation, and Operation of On-Site Wastewater Treatment
and Disposal Systems, 7 Del. Admin. Code § 7101.
3
7 Del. Admin. Code § 7101-6.5 (“A permit application will not be reviewed by the Department
until the SIR, HSR and SWAR have been reviewed and approved by the Department.”). An HSR
report “characterizes the hydrogeologic properties present on a given site through direct
observations.” Id. at § 7101-2.0. An SWAR “characterizes the potential nutrient impacts of a
wastewater treatment system to a site from future development through background data and
computer modeling.” Id.
5
was ready for review—even though it did not contain an HSR and SWAR. After a
public hearing and public comment period, and favorable recommendation from a
Hearing Officer, the DNREC Secretary approved the 2017 Permit Application and
directed that the permit be issued (the “2017 Permit”). According to the Secretary,
the Sussex Facility must meet the highest criteria for spray irrigation, and the
changes to the number and capacity of the ponds, the sprayable acreage, and project
phasing were reasonable adjustments to the 2013 Permit.4 In response to public
objections that Artesian’s application was not administratively complete for failing
to include an HSR and SWAR, the Secretary treated the 2017 Permit Application as
an amendment to Artesian’s 2013 Permit instead of a new permit “because the 2013
Permit remains in effect.”5
Appellants Keep Our Wells Clean (“KOWC”) appealed the Secretary’s 2017
Permit approval to the Environmental Appeals Board (“EAB”). 6 The issues
included whether DNREC should have denied the 2017 Permit because Artesian
failed to submit an HSR and SWAR as required by the 2014 Regulations.7 The EAB
held hearings on May 22, 2018 and March 12, 2019. At the second hearing, the
4
App. to Opening Br. A074, A078 (Secretary’s Order No. 2017-W-0029, at 7, 11).
5
App. to Opening Br. at A071 (Secretary’s Order No. 2017-W-0029, at 4).
6
Under 7 Del. C. § 6008(a), a person whose interests are substantially affected the Secretary’s
action may appeal to the EAB within 20 days of the Secretary’s order.
7
KOWC raised other objections before the EAB but have not pursued them on appeal.
6
Board heard from John G. Hayes, Jr., DNREC’s Program Manager for the Large
Systems Branch, Ground Water Discharge Section. Mr. Hayes testified that he:
(1) was familiar with [the Sussex Facility] as originally approved and
with the proposed amendments to the [2013 Permit]; (2) was familiar
with the 2014 Regulations; (3) knew that no HSR [or] SWAR had been
filed with the amended application; (4) believed that only a new
application required an HSR and SWAR; (5) believed that an existing
permit could be amended; (6) believed that the proposed changes to the
construction permit were not significant enough to require a new
application; (7) believed that the site was still suitable for the disposal
of treated wastewater; [and] (8) believed that Artesian had submitted
everything it was obligated to submit . . . .8
KOWC called Christopher P. Grobbel, Ph.D., an expert in hydrology and
hydrogeology. During Dr. Grobbel’s testimony, Artesian objected on the grounds
that his testimony dealt with operational issues rather than those for a construction
permit and thus exceeded the relevant issues being heard by the EAB. DNREC
moved to cut off Dr. Grobbel’s testimony and for a directed verdict that Artesian did
not have to submit an HSR and SWAR with its 2017 Permit Application. After
hearing argument, the Board voted 6-0 to affirm the Secretary’s order granting the
2017 Permit.
In a June 10, 2019 written decision and final order, the EAB made the
following findings relevant to this appeal:
The Board agrees with DNREC and Artesian’s contention that, as a
matter of law, the 2014 regulations do not apply to the amendment to
the existing construction permit. DNREC concluded that a permit
8
Keep Our Wells Clean, 2020 WL 1320954, at *3.
7
amendment is subject to the regulations that were in effect at the time
of the initial permit application unless the changes are significant. In
this case DNREC determined the changes are not significant enough to
require the applicant to submit a new permit application. DNREC’s
determination is not clearly wrong.
The Board agrees with Artesian’s contention, and finds as a matter of
law, that it submitted the required plan, specifications and design
engineer report contemplated by [the Regulations].9
KOWC appealed the EAB’s decision to the Superior Court. The court
described the main issue on appeal as whether “DNREC correctly processed
amendments to a 2013 construction permit that was approved under the 1999
Regulations where those amendments are now governed by – at least to some extent
– the 2014 Regulations.”10 The Superior Court focused on three sections of the 2014
Regulations: Section 6.1, which requires that an applicant “obtain” a permit from
DNREC prior to beginning construction or operation of any on-site wastewater
treatment facility; 11 Section 6.5, which requires an HSR and SWAR as part of a
9
EAB Order, at 12. The EAB’s order makes reference to Section 6.3.1.1.14., rather than
6.3.1.14.1. The Superior Court and the parties agree that this is a typographical error. Keep Our
Wells Clean, 2020 WL 1320954, at *5 n.11; Opening Br. at 12; Artesian Answering Br. at 15.
10
Keep Our Wells Clean, 2020 WL 1320954, at *5.
11
7 Del. Admin. Code § 7101-6.1 (“A permit must be obtained from the Department prior to the
construction, operation, maintenance or repair of any on-site wastewater treatment and disposal
systems with daily design flow rates of ≥ 2,500 gallons.”).
8
construction permit application;12 and Section 6.3.1.14.1, which covers construction
permit changes.13
First, the court held that Sections 6.1 and 6.5 only apply when an applicant
requests a new permit. Here, according to the court, Artesian already had the 2013
Permit, and sought to “amend” an existing permit. Second, the court found that the
EAB correctly applied Section 6.3.1.14.1 because that section “by its clear language,
allows Artesian to seek an amendment to its existing construction permit” when
“changes have occurred.”14 Although the 2014 Regulations did not address when
the changes to an existing permit were substantial enough to require a new
construction permit application, the Superior Court found that DNREC properly
exercised its regulatory discretion when it found that Artesian’s proposed changes
were not substantial enough to require further hydrogeologic and soil studies. Thus,
the Superior Court upheld the EAB’s decision.
II.
We can distill the issues on appeal to two main points—whether the EAB
erred when it supposedly found that the 2014 regulations do not apply to Artesian’s
12
7 Del. Admin. Code § 7101-6.5 (“In order to obtain a permit . . . a permit application must be
submitted to the Department for review and approval. A permit application will not be reviewed
by the Department until the SIR, HSR and SWAR have been reviewed and approved by the
Department.”).
13
7 Del. Admin. Code § 7101-6.3.1.14.1 (“A construction permit application, plans and
specifications and design engineer report with applicable fees must be submitted to the Department
if the construction permit has expired or changes have occurred.”).
14
Keep Our Wells Clean, 2020 WL 1320954, at *6.
9
2017 Permit Application; and if the 2014 Regulations are applied, whether those
regulations required Artesian to submit an HSR and SWAR with its 2017 Permit
Application. Our review of the EAB’s decision matches that of the Superior Court–
whether the decision is supported by substantial evidence and is free from legal
error. 15 “Substantial evidence is that which a reasonable mind might accept as
adequate to support a conclusion.”16 It is more than a “mere scintilla but less than a
preponderance of the evidence.”17
A.
As noted earlier, the EAB found that, “as a matter of law, the 2014 regulations
do not apply to the amendment to the existing construction permit.”18 KOWC argues
the EAB erred because the 2014 Regulations apply to all aspects of wastewater
treatment facilities, and “supersede and replace” the 1999 Regulations.19 If DNREC
applied the 2014 Regulations, KOWC argues, Sections 6.1 and 6.5 required that
Artesian submit a HSR and SWAR with its 2017 Permit Application.
We agree with the Superior Court, however, that what the EAB wrote must
be viewed in context. In its decision, the EAB expressly and impliedly made two
15
State of Del. Dep’t of Nat. Res. & Envtl. Control v. McGinnis Auto & Mobile Home Salvage,
225 A.3d 1251, 1254 (Del. 2020) (citing Stoltz Mgmt. Co. v. Consumer Affairs Bd., 616 A.2d 1205,
1208 (Del. 1992)).
16
Prunchkun v. Del. Dep’t of Heath & Soc. Servs., 201 A.3d 525, 540 (Del. 2019).
17
Powell v. OTAC, Inc., 223 A.3d 864, 870 (Del. 2019).
18
App. to Opening Br. at A579 (EAB Order, at 12).
19
7 Del. Admin. Code § 7101-1.2.1; § 7101-1.3.
10
points—first, Section 6.3.1.14.1 of the 2014 Regulations applied to Artesian’s 2017
Permit Application, and second, Artesian was excused from submitting a HSR and
SWAR under Section 6.3.1.14.1 because the Artesian’s proposed changes to its 2013
Permit were not substantial enough to warrant a new application with a HSR and
SWAR. Our conclusion is confirmed when the one sentence KOWC isolates is read
in the context of the rest of the paragraph in the EAB’s Order. In the follow-on
sentences, the EAB elaborated that:
DNREC concluded that a permit amendment is subject to the
regulations that were in effect at the time of the initial permit
application unless the changes are significant. In this case DNREC
determined the changes are not significant enough to require the
applicant to submit a new permit application. DNREC’s determination
is not clearly wrong.20
As these sentences show, the EAB was referring to the substance of Section
6.3.1.14.1 of the 2014 Regulations. Section 6.3.1.14.1 of the 2014 Regulations
addresses “changes” in construction plans. Applying the 2014 Regulations, the EAB
found that the proposed “changes” to Artesian’s 2013 construction plans were not
substantial enough to require an HSR and SWAR under the 2014 Regulations. Thus,
having actually applied Section 6.3.1.14.1 of the 2014 Regulations to Artesian’s
20
App. to Opening Br. at A579 (EAB Order, at 12).
11
2017 Permit Application, EAB did not err as a matter of law by failing to apply the
2014 Regulations.21
B.
Our conclusion that the EAB applied Section 6.3.1.14.1 of the 2014
Regulations to Artesian’s 2017 Permit Application leads to the second issue on
appeal—whether the EAB erred when it held that, under Section 6.3.1.14.1, Artesian
was amending its 2013 Permit, and the proposed changes to the 2013 Permit were
not substantial enough to require an HSR and SWAR.
Section 6.3.1.14.1, entitled Construction Permit, provides as follows:
A construction permit application, plans and specifications and
design engineer report with applicable fees must be submitted to the
Department if the construction permit has expired or changes have
occurred.
The Superior Court held that Section 6.3.1.14.1, “by its clear language, allows
Artesian to seek an amendment to its existing construction permit.” 22 KOWC
counters that the regulation does not mention amendments to existing permits.23 It
requires a “construction permit application” and not an amended application if a
permit has expired or changes occur. And, under Sections 6.1 and 6.5 of the 2014
21
Because the EAB did not err as a matter of law, we need not address KOWC’s alternative
argument that the EAB erred as a matter of fact by failing to apply the 2014 Regulations.
22
Keep Our Wells Clean, 2020 WL 1320954, at *6.
23
Opening Br. at 29.
12
Regulations, all construction permit applications must have an HSR and SWAR.
KOWC also calls our attention to Section 6.5.3.3.1, which addresses amendments to
operating permits.24 A comparable amendment provision is absent for construction
permits.
Section 6.3.1.14.1 is not altogether clear when applied to holders of existing
wastewater facility construction permits issued before the 2014 Regulations. The
Section does not expressly provide for amending an existing permit. Instead, it
requires the holder of an existing permit to file another permit application if the
permit has expired or changes have occurred. Artesian filed another permit
application and related planning documents, which KOWC argues is a concession
that “changes have occurred.”
Practically speaking, the EAB and the Superior Court correctly described
what Artesian wanted to accomplish through the 2017 Permit Application—to revise
the 2013 Permit construction plans for Phase I to address the change in effluent
source from untreated household discharge to treated food processing wastewater.
We agree with KOWC, however, that Artesian’s and DNREC’s description of the
2017 Permit Application as an “amendment” to the 2013 Permit has no support in
the 2014 Regulations. Under Section 6.3.1.14.1 of the 2014 Regulations, a permit
24
7 Del. Admin. Code § 7101-6.5.3.3.1 (“In consultation with the permittee, the Department may
modify or amend an existing permit provided that the modifications would not result in an
increased impact or risk to the environment or public health.”).
13
application is still required and must include an HSR and SWAR unless the Section
itself imposes its own requirements separate from those that apply to an original
construction permit application. We find that it does.
As noted earlier, Section 6.3.1.14.1 addresses an existing permit holder who
wants to make changes to that permit. Artesian proposed a “change” in its
construction plans under its 2013 Permit to accommodate a different source of
effluent. Although Artesian’s 2017 Permit Application is akin to an amendment to
its 2013 Permit, we read the Section differently. Under the Section, when Artesian
sought to change its 2013 Permit to accommodate a new effluent source, Section
6.3.1.14.1 required Artesian to submit “plans and specifications and design
engineering report” with its 2017 Permit Application. As we read the statute, the
plans and specifications and design engineering report submitted under Section
6.3.1.14.1 are separate from the other regulatory requirements and do not include an
HSR and SWAR.
Three basic points support our interpretation. First, if DNREC had wanted
applicants to start from scratch, DNREC could have simply stated in the Section that
an existing permit holder must submit a new application. In that event, Sections 6.1
and 6.5 would require an HSR and SWAR and other submissions. DNREC,
however, chose a different path. Section 6.3.1.14.1 states what must be submitted
with an application to change construction plans under an existing permit—“plans
14
and specifications and design engineering report.” The Section does not mention an
HSR or SWAR. Second, we must give meaning to “plans and specifications and
design engineering report.” If it meant the same as the requirements of Sections 6.1
and 6.5, it would be unnecessary to include the language.25 And finally, to secure
the 2013 Permit, Artesian already submitted for review and approval environmental
and engineering reports to spray wastewater on the site. In the context of an
application to change an existing permit, it makes sense that DNREC would not
require start-from-scratch environmental and engineering reports as long as the
application stayed within the boundaries of the existing permit.
Our interpretation of Section 6.3.1.14.1 does not leave DNREC powerless to
review proposed changes to an existing permit. DNREC must still decide whether
the proposed changes are consistent with the existing permit, which is what DNREC
did here. DNREC scrutinized the size increase of the on-site wastewater storage
pond from 62 to 90 million gallons.26 The Secretary found the change insignificant
because the pond is still on the approved 75 acre parcel, is similar to other farm
ponds, and will have a landscaped buffer. 27 DNREC also found that delaying
wastewater treatment plant construction “will reduce the amount of disturbance”
25
Garrison v. Red Clay Consol. Sch. Dist., 3 A.3d 264, 276 (Del. 2010) (quoting Oceanport Indus.,
Inc. v. Wilmington Stevedores, Inc., 636 A.2d 892 (Del. 1994)) (when interpreting statutes and
regulations, the court should avoid surplusage).
26
App. to Opening Br. at A072 (Secretary’s Order No. 2017-W-0029, at 5); Id. at A091-92.
27
Id. at A094.
15
during Phase I and improve the quality of the sprayed wastewater.28 And finally, the
reduction in spray irrigation areas did not change the original planned acreage or
volume of wastewater sprayed on the fields.29 All of these findings are supported
by the record. If DNREC had found that Artesian’s proposed changes were
inconsistent with its 2013 Permit, DNREC was free to reject the 2017 Permit
Application and require a start from scratch wastewater treatment construction
permit.
III.
The EAB applied the 2014 Regulations—specifically Section 6.3.1.14.1—to
Artesian’s 2017 Permit Application. Under Section 6.3.1.14.1, DNREC approved
Artesian’s 2017 Permit Application requesting changes to its 2013 Permit after
reviewing and approving the “plans and specifications and design engineering
report” required under that Section. Artesian did not have to submit an HSR or
SWAR to secure the changes to its 2013 Permit. The judgment of the Superior Court
is affirmed.
28
Id. at A072, A076 (Secretary’s Order No. 2017-W-0029, at 7, 9); Id. at A093.
29
Id. at A092; Id. at A426, A431.
16