In re Application of Gourley Brothers, LLC for a Water Appropriation Permit. ( 2015 )

This opinion will be unpublished and
may not be cited except as provided by
Minn. Stat. § 480A.08, subd. 3 (2014).
STATE OF MINNESOTA
IN COURT OF APPEALS
A14-2141
In re Application of Gourley Brothers, LLC
for a Water Appropriation Permit.
Filed August 24, 2015
Affirmed
Toussaint, Judge*
Department of Natural Resources
File No. 2013-1423
Amanda P. Hungerford (pro hac vice), Washington, D.C. (for relators Russell Anderson,
Katrina Downes, Travis Winter, Joel Walsh, Amy Walsh, and Mary Soupir)
Amanda E. Prutzman, Eckberg, Lammers, Briggs, Wolff & Vierling, PLLP, Stillwater,
Minnesota (for relators The Humane Society of the United States, Russell Anderson,
Katrina Downes, Travis Winter, Joel Walsh, Amy Walsh, and Mary Soupir)
Lori Swanson, Attorney General, Karen D. Olson, Assistant Attorney General, St. Paul,
Minnesota (for respondent Minnesota Department of Natural Resources)
Jack Y. Perry, Maren F. Grier, Briggs and Morgan, P.A., Minneapolis, Minnesota (for
respondents Gourley Premium Pork, a/k/a Gourley Premium Pork, LLC, a/k/a Gourley
Brothers, LLC)
Considered and decided by Johnson, Presiding Judge; Kirk, Judge; and Toussaint,
Judge.
*
Retired judge of the Minnesota Court of Appeals, serving by appointment pursuant to
Minn. Const. art. VI, § 10.
UNPUBLISHED OPINION
TOUSSAINT, Judge
Relators1 challenge respondent Minnesota Department of Natural Resources’
(DNR) issuance of a water-appropriation permit, arguing that the DNR’s decision was
arbitrary and capricious and its findings were not supported by substantial evidence. We
affirm.
FACTS
In 2012, Gourley Brothers, LLC (Gourley) proposed to build a total-confinement,
4,000-hog feedlot in Todd County. The proposed feedlot underwent environmental
review in 2012. The Minnesota Pollution Control Agency (MPCA) completed an
environment assessment worksheet (EAW) and determined that the feedlot did not have
the potential for significant environmental effects, negating the need for an environmental
impact statement (EIS).
In May 2013, Gourley applied for a water-appropriation permit from the DNR.
Included with the application was a “well and boring record” that identified the location
of each well and provided geological information and information on the static water
level of the aquifer. Gourley also submitted well pump test results for each well that
indicated the drawdown and recovery rates of the aquifer when both wells were pumping
water at the maximum rate. The DNR requested additional information from Gourley,
including property tax information, and an estimate of daily and annual water usage,
1
Relators include the Humane Society of the United States (the humane society), Russell
Anderson, Katrina Downes, Travis Winter, Joel Walsh, Amy Walsh, and Mary Soupir.
2
which Gourley provided. According to Gourley’s water usage estimates, the feedlot
would use approximately 6.62 million gallons of water per year.
In early October, the DNR issued Gourley a water-appropriation permit allowing
the feedlot to use up to 8 million gallons of water annually. In November, relators
requested a contested case hearing on the issuance of the permit under Minn. Stat.
103G.311 (2014). DNR denied this request on the basis that relators are not one of the
parties permitted to demand a hearing under Minn. Stat. 103G.311, subd 5(a). Relators
petitioned for certiorari review of the DNR’s issuance of the permit, arguing the DNR
inappropriately issued the permit without making factual findings. This court agreed,
concluding that the DNR’s failure to provide any findings prevented meaningful
appellate review of its decision. In re Gourley Bros., LLC, No. A13-2247, 2014 WL
4056063, at *5 (Minn. App. Aug. 18, 2014) (hereinafter “Gourley I”). Accordingly, this
court remanded for additional findings. Id. In September 2014, DNR issued an amended
water-appropriation permit that adopted and incorporated the MPCA’s findings from the
EAW and negative declaration on the need for an EIS. This certiorari appeal follows.
DECISION
“[D]ecisions of administrative agencies enjoy a presumption of correctness, and
deference should be shown by courts to the agencies’ expertise and their special
knowledge in the field[s] of their technical training, education, and experience.” Reserve
Mining Co. v. Herbst, 256 N.W.2d 808, 824 (Minn. 1977). This court’s role is to ensure
the agency has taken a “hard look” at the salient issues and “genuinely engaged in
reasoned decision-making.” Id. at 825. We will not disturb an agency’s decision unless
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it reflects an error of law, the findings are arbitrary and capricious, or the findings are not
supported by substantial evidence. Citizens Advocating Responsible Dev. v. Kandiyohi
Cnty. Bd. of Comm’rs, 713 N.W.2d 817, 832 (Minn. 2006) (quotation omitted).
“Substantial evidence consists of: (1) such relevant evidence as a reasonable mind
might accept as adequate to support a conclusion; (2) more than a scintilla of evidence;
(3) more than ‘some evidence’; (4) more than ‘any evidence’; and (5) evidence
considered in its entirety.” Id. (quotation omitted). An agency’s decision is arbitrary and
capricious if the agency (a) relied on factors the legislature never intended it to consider,
(b) entirely failed to consider an important aspect of the problem, (c) offered an
explanation for the decision that runs counter to the evidence, or (d) rendered a decision
so implausible that it could not be ascribed to a difference in view or the result of agency
expertise. Watab Twp. Citizen All. v. Benton Cnty. Bd. of Comm’rs, 728 N.W.2d 82, 89
(Minn. App. 2007), review denied (Minn. May 15, 2007).
If an agency engages in reasoned decision-making, this court will affirm, even
though it may have reached a different conclusion had it been the factfinder. Cable
Commc’ns Bd. v. Nor-west Cable Commc’ns P'ship, 356 N.W.2d 658, 669 (Minn. 1984).
The party challenging the agency decision has the burden of proving grounds for reversal.
Markwardt v. State Water Res. Bd., 254 N.W.2d 371, 374 (Minn. 1977).
Relators argue that the DNR’s decision to grant a water-appropriation permit was
arbitrary and capricious because its findings on remand represent conclusory post-hoc
rationalizations and “unsubstantiated assertions,” which demonstrate that the DNR failed
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to conduct a meaningful review of the statutory factors it was required to consider. We
disagree.
A complete groundwater-use permit application requires the following:
(1) a water well record . . . information on the
subsurface geologic formations penetrated by the well and the
formation or aquifer that will serve as the water source, and
geologic information from test holes drilled to locate the site
of the production well;
(2) the maximum daily, seasonal, and annual pumpage
rates and volumes being requested;
(3) information on groundwater quality in terms of the
measures of quality commonly specified for the proposed
water use and details on water treatment necessary for the
proposed use;
(4) an inventory of existing wells within 1–1/2 miles of
the proposed production well or within the area of influence,
as determined by the commissioner. The inventory must
include information on well locations, depths, geologic
formations, depth of the pump or intake, pumping and
nonpumping water levels, and details of well construction;
[and]
(5) the results of an aquifer test completed according to
specifications approved by the commissioner. The test must
be conducted at the maximum pumping rate requested in the
application and for a length of time adequate to assess or
predict impacts to other wells and surface water and
groundwater resources. The permit applicant is responsible
for all costs related to the aquifer test, including the
construction of groundwater and surface water monitoring
installations, and water level readings before, during, and
after the aquifer test[.]
Minn. Stat. § 103G.287, subd. 1(a) (2014). The DNR is permitted to waive any of the
application requirements above “if the information provided with the application is
adequate to determine whether the proposed appropriation and use of water is sustainable
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and will protect ecosystems, water quality, and the ability of future generations to meet
their own needs.” Id., subd. 1(b) (2014).
The DNR shall issue the water-appropriation permit if it concludes the applicant’s
plans are “reasonable, practical, and will adequately protect public safety and promote the
public welfare.” Minn. Stat. § 103G.315, subd. 3 (2014). The DNR shall make findings
of fact on issues necessary for determination of the applications considered and those
findings must be based on substantial evidence. Id., subd. 2 (2014). The DNR shall
consider the following factors when reviewing an application:
(1) the location and nature of the area involved and the
type of appropriation and its impact on the availability,
distribution, and condition of water and related land resources
in the area involved;
(2) the hydrology and hydraulics of the water
resources involved and the capability of the resources to
sustain the proposed appropriation based on existing and
probable future use;
(3) the probable effects on the environment including
anticipated changes in the resources, unavoidable detrimental
effects, and alternatives to the proposed appropriation;
(4) the relationship, consistency, and compliance with
existing federal, state, and local laws, rules, legal
requirements, and water management plans;
(5) the public health, safety, and welfare served or
impacted by the proposed appropriation;
(6) the quantity, quality, and timing of any waters
returned after use and the impact on the receiving waters
involved;
(7) the efficiency of use and intended application of
water conservation practices;
(8) the comments of local and regional units of
government, federal and state agencies, private persons, and
other affected or interested parties;
(9) the adequacy of state water resources availability
when diversions of any waters of the state to any place
outside of the state are proposed;
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(10) the economic benefits of the proposed
appropriation based on supporting data when supplied by the
applicant.
Minn. R. 6115.0670, subp. 2 (2013).
The DNR expressly adopted the MPCA’s findings from its EAW and negative
declaration, and relied heavily on them in justifying its decision to issue the permit.
Such reliance on the MPCA’s findings is authorized by law. See Minn. R. 4410.7055
(2013) (directing governmental bodies with permitting authority over a project to
consider environmental review in making a decision to authorize the project); Minn. R.
4410.0300, subp. 4 (2013) (identifying objectives of the environmental review process
including the provision of usable information to “governmental decision makers . . .
concerning the primary environmental effects of a proposed project”). And when the
DNR’s findings are considered in conjunction with the adopted MPCA findings it is clear
that the DNR’s decision was not arbitrary and capricious and based on substantial
evidence in the record.
First, the adopted MPCA findings as a whole support the determination that the
feedlot’s water appropriation will not dangerously deplete the aquifer and is unlikely to
contaminate the area’s water resources. With regards to the impact on available
groundwater, the EAW states:
A review of published geologic and hydrogeologic
data indicates that the water-bearing characteristics of the
surficial aquifer (including recharge) and the nature of its
existing use as a groundwater source, water use for this
project is not expected to interfere with other groundwater
uses.
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The negative declaration also acknowledged that “[s]ignificant adverse impacts to water
quantity are not expected.” Moreover, we disagree with relators’ assertion that the
MPCA deferred to the DNR on the issue of groundwater quantity based on its
acknowledgement that Gourley was required to secure a water-appropriation permit from
the DNR. The substance of MPCA’s findings does not indicate that it deferred to the
DNR to determine the groundwater impact of the project. Rather, it demonstrates that the
MPCA was merely highlighting the fact that the water-appropriation permit provided a
further mechanism to investigate and address any “well interference” that might arise in
the future.
Second, the EAW and negative declaration found that the feedlot would not
negatively impact surface or groundwater quality. The MPCA specifically noted that the
facility was a “total confinement” building with no access to surface water and “[t]he
manure storage structures proposed will be concrete, will not be open to the environment,
and are designed specifically to prevent contamination of groundwater.” The MPCA also
highlighted the fact that the feedlot was required to meet a “zero discharge” standard as
part of its 2011-2016 Feedlot General NPDES/SDS permit, which minimized, if not
eliminated, the risk of water contamination.
Third, in addition to adopting and discussing the MPCA findings above, the DNR
identified other evidence in the record that supports its decision to issue the permit. With
regard to the feedlot’s impact on water quantity and availability, the DNR noted that the
pump test data indicates that the aquifer “is strong, stabilized at three feet of drawdown,
and quickly recharged.” The DNR further explained that this pump test data was
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analyzed by a DNR Area Hydrologist who determined the proposed appropriation was
sustainable. The DNR also stated that in completing this hydrological analysis it relied
on the County Well Index and its well and boring records that included information about
the wells’ location, depth, static water level, construction and geological analysis.
Relators challenge the reliability of the DNR hydrologist’s calculations and the
data she relied on in making those calculations. The DNR’s findings indicate its
hydrologist reviewed the data in the record, did not find it lacking and used it to
determine the appropriation’s impact on the aquifer would not be detrimental. Such
findings and determinations fall squarely within the realm of the agency’s technical
training and expertise. We defer to the agency on such matters when, as is the case here,
there is support in the record for its conclusions. Reserve Mining, 256 N.W.2d at 824.
The DNR’s findings also addressed the environmental and public health concerns
raised by “Brooke Haworth, the Humane Society of the United States, the Socially
Responsible Agricultural Project, and Minnesotans Fighting for Minnesota.” The DNR
explained that “[t]he MPCA Findings specifically addressed the water quality and public
health concerns raised in [the] comments” and the DNR relied on those findings, which
“determined that the proposed project does not pose a significant environmental effect on
groundwater or surface water quality.” The DNR also addressed the commenters
concerns about the impact on the aquifer, stating “[c]oncerns raised regarding the effect
of the water appropriation on the water table” were not only addressed by the MPCA’s
determination that the groundwater appropriation did not have the potential for
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environmental effects, but also by the DNR’s hydrological analysis which showed that
the proposed appropriation “was not likely to have a deleterious effect on the aquifer.”
In sum, the DNR’s discussion of the evidence above demonstrates that its findings
were more than conclusory post hoc rationalizations, as relators suggest. On remand, the
DNR was directed to make findings and it did so in part by permissibly relying on the
MPCA environmental review findings. Moreover, the DNR’s findings relied on its own
hydrologist’s analysis of the evidence in the record. Such analysis is entitled to deference
in this context as it addresses matters that fall directly within the DNR’s area of technical
expertise. This analysis combined with the MPCA findings that the DNR properly relied
upon demonstrate its decision to grant the water-appropriation permit was based on
substantial evidence in the record. And when the DNR’s findings are examined as whole,
along with the adopted MPCA findings, we are not left with the distinct impression its
actions in this context were arbitrary and capricious. Accordingly, we affirm the DNR”s
decision to grant the water-appropriation permit.
Affirmed.
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