Quinault Indian Nation v. Imperium Terminal Servs., LLC ( 2017 )

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This opinion was filed for record
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. DATE
1111190 Wn. App. 696, 360 P.3d 949 (2015). The Court of Appeals
affirmed the Board's grant of summary judgment. Id. at 700. It found that the
Westway and Imperium proposals were not subject to ORMA because they are not
"ocean uses" or "transportation uses" under WAC 173-26-360(3) and (12). Id. at
4 Because this third project withdrew its plans for construction, the Court of Appeals determined
the issue was moot. Respondents have not further challenged that determination. Quinault
Indian Nation v. Imperium Terminal Servs., LLC, 190 Wn. App. 696, 703-04, 360 P.3d 949(20 15).
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Quinault Indian Nation, et al. v. Imperium Terminal Svcs., eta!.
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712-17. The court reasoned that respondents' projects were not "ocean uses"
because the terminals did not constitute a "primary activity occurring on
Washington's coastal waters." Id at 713. The court did not directly address
ORMA's plain language or whether the Board was required to apply it to
respondents' proposals. The court instead noted that ORMA does not contain any
definition of "ocean uses," noted further that neither party had "challenged this
regulation," and declined to analyze the statute further. !d. at 713 n. 8.
Petitioners sought review by this court, which was granted. Quinault Indian
Nation v. City ofHoquiam, 185 Wn.2d 1017, 369 P.3d 500 (2016). We now find
that the Board and Court of Appeals erred when finding that ORMA does not
apply to respondents' proposed projects.
ISSUES
1. Do respondents' proposed projects trigger review under ORMA's
statutory framework, RCW 43.143 .030?
2. Do these proposed projects constitute "[o]cean uses" or
"transportation" under WAC 173-26-360(3) and (12)?
3. Do these proposed projects constitute "coastal uses" under WAC 173-
26-360(6)?
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STANDARD OF REVIEW
Summary judgment is proper if there is no genuine issue as to any material
fact, the moving party is entitled to judgment as a matter of law, and reasonable
minds could reach only one conclusion from the evidence presented. Bostain v.
Food Express, Inc., 159 Wn.2d 700, 708, 153 P.3d 846 (2007). We review grants
of summary judgment de novo. Michak v. Transnation Title Ins. Co., 148 Wn.2d
788, 794-95, 64 P.3d 22 (2003).
The issue here is whether the Board properly granted summary judgment
when it found that respondents' projects were not subject to review under ORMA.
Interpreting ORMA is an issue of first impression for this court. We interpret
statutes de novo, as a question oflaw. Dep't ofEcology v. Campbell & Gwinn,
LLC, 146 Wn.2d 1, 9, 43 P.3d 4 (2002). When interpreting statutes, our
fundamental purpose is to ascertain and carry out the intent of the legislature, In re
Marriage of Schneider, 173 Wn.2d 353, 363, 268 P.3d 215 (2011). If a statute's
meaning is plain on its face, "then the court must give effect to that plain meaning
as an expression oflegislative intent." Campbell & Gwinn, 146 Wn.2d at 9-10.
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ANALYSIS
1. Respondents' Proposed Facility Expansion Projects Trigger Review under
ORMA 's Statutory Framework, RCW 43.143.030
The Shoreline Management Act of 1971 is an extensive regulatory scheme
designed to help local governments manage development along shorelines. Ch.
90.58 RCW. ORMA is integrated within this framework. See RCW 90.58.195(2)
(counties, cities, and towns with coastal waters must ensure that their shoreline
master programs "conform with RCW 43.143.010 and 43.143.030 and with the
department of ecology's ocean use guidelines"). The purpose of ORMA is "to
articulate policies and establish guidelines for the exercise of state and local
management authority over Washington's coastal waters, seabed, and shorelines."
RCW 43.143.010(1).
A. ORMA Is a Balancing Tool That Must Be Liberally Construed
ORMA is a balancing tool intended to be used by local governments to
weigh the commercial benefits of coastal development against the State's interest
in protecting coastal habitats and conserving fossil fuels. In its findings section,
the legislature identified the ecological importance of our state's coastal habitats:
"Washington's coastal waters, seabed, and shorelines are among the most valuable
and fragile of its natural resources." RCW 43.143.005(1). The legislature also
emphasized the commercial utility of industries dependent on the ocean and
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shoreline. RCW 43.143 .005(2). While recognizing the importance of commercial
uses, the legislature nonetheless signaled that commercial endeavors may be
prohibited if they are potentially destmctive to the environment. RCW
43.143.005(3) ("Washington's coastal waters, seabed, and shorelines are faced
with conflicting use demands. Some uses may pose unacceptable environmental or
social risks at certain times.").
The purpose of statutory interpretation is to give effect to the intent of the
legislature. Campbell & Gwinn, 146 Wn.2d at 9. We have historically found that
when passing laws that protect Washington's enviromnental interests, the
legislature intended those laws to be broadly construed to achieve the statute's
goals. See, e.g., Kucera v. Dep't ofTransp., 140 Wn.2d 200,212,995 P.2d 63(2000) (noting that SEPA requires an environmental impact analysis even if a
party's primary motivation for such analysis is economic in nature); Leschi Imp.
Council v. Wash. State Highway Comm., 84 Wn.2d 271,277,525 P.2d 774 (1974)
(plurality opinion) (noting SEPA's application to "broader questions of
environmental impact"). ORMA is designed to address environmental threats to
our coastal waters and specifically addresses the threats posed by increased
expansion of the fossil fuel industry along the Pacific Coast. See RCW
43.143.010. The language of the statute indicates that the legislature intended it to
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combat current environmental dangers and to preemptively protect the coastline
from future environmental risks. Because ORMA addresses broad concerns
surrounding the environmental dangers of collecting and transporting oil near our
shores, it requires a liberal construction.
B. Under the Plain Language of the Statute, ORMA Applies to Respondents'
Projects
In this case, the Court of Appeals neglected to apply the plain language of
the statute, skipping directly to the definition of "ocean use" in WAC
173-26-360(3). Quinault, 190 Wn. App at 711-12. In so doing, the Court of
Appeals failed to consider the legislature's explicit direction as written in the
statute. In relevant part, RCW 43.143.030 states:
(1) When the state ofWashington and local governments develop
plans for the management, conservation, use, or development of
natural resources in Washington's coastal waters, the policies in RCW
43.143.010 shall guide the decision-making process.
(2) Uses or activities that require federal, state, or local
government permits or other approvals and that will adversely impact
renewable resources, marine life, fishing, aquaculture, recreation,
navigation, air or water quality, or other existing ocean or coastal
uses, may be permitted only if the criteria below are met or
exceeded ....
The plain text of this statute includes respondents' terminal expansion
projects. These shoreline management plans include "plans for the management,
conservation, use, or development" of Washington's environment. RCW
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43.143.030(1). Further, they make use of"natural resources in Washington's
coastal waters" as defined in the statute. Id. Respondents' projects are designed to
transfer tens of millions of gallons of petroleum products across the threshold of
Washington's coast. The projects thus constitute "[u]ses or activities" that require
government permits and may "adversely impact renewable resources, ...
navigation, ... or other existing ocean or coastal uses" due to the dramatic increase
in both ocean vessel and rail traffic. RCW 43.143.030(2).
Nonetheless, Westway argues that ORMA's review criteria are narrowly
triggered by the "location and nature of the activity." Suppl. Br. ofResp't
Westway at 4. Likewise, Imperium claims respondents' projects are activities on
coastal waters rather than in the water itself. See Suppl. Br. of Resp't Imperium at
10-12. The city of Hoquiam and DOE make similar arguments, indicating that the
statutory language of ORMA shows it applies only to projects that sit "in" coastal
waters. Suppl. Br. ofResp'ts Hoquiam & DOE at 6-14. Thus, according to
respondents, because the bulk of these projects are several feet adjacent to the
coast, and because any additions would be made to already existing facilities in
Grays Harbor, ORMA should not apply. These arguments construe the statute too
narrowly.
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The plain language of RCW 43.143 .030(1) anticipates respondents' projects.
To hold that the statute does not apply to a storage facility transferring oil products
from land transport to sea transport because the project is not literally "in" the
ocean would be an overly narrow reading of the text. As explained above, the
terminal expansion projects involve vast quantities of petroleum products. They
receive petroleum and other fuel products on trains or trucks, transfer the products
to temporary holding tanks, and then pipe the products into waiting vessels for
further transport. The pipes that these products flow through extend from the coast
onto a terminal, a structure located in Grays Harbor. The pipes then deposit the
products onto ocean-bound tankers moored to the terminal. Further, the proposals
include adding new loading arms and a combustion system on an existing dock.
Thus, though the projects themselves are not literally "in" Washington's coastal
waters, they would pump petroleum over those coastal waters, transfer them into
vessels floating in those coastal waters, and require additional transfer installations
on a dock located on those coastal waters. As noted above, we must construe this
statute liberally, Therefore, the transfer of these products into these vessels and the
construction of additional facilities constitute "management, conservation, use, or
development of natural resources in Washington's coastal waters." RCW
43.143 .030(1 ).
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C. Other ORMA Provisions Indicate That the Projects Require Review
under the Statute
RCW 43.143.030(2) also supports applying ORMA to these projects. It
indicates that uses that (1) require government permits and (2) will adversely
impact renewable resources, navigation, or other existing "ocean or coastal uses"
are subject to ORMA. Respondents' projects require several government permits
before construction can commence. They pose a great risk of adversely impacting
renewable resources with their increased threat of environmental harm. They may
also adversely impact navigation or preexisting ocean or coastal uses in the area by
creating a substantial increase in ocean vessel and rail transits and increased risk of
oil spills on coastal waters and coastline. Because ofthis, the projects are subject
to ORMA review.
The plain language ofRCW 43.143.010(5) further enforces this
interpretation. RCW 43.143.010 explicitly lays out the legislature's policy and
intent when it passed ORMA. Several subsections indicate an intent to regulate
and limit collection and use of fossil fuels off our shores. RCW 43.143.010(1)-(4).
However, subsection (5) demonstrates that the legislature did not intend ORMA to
be restricted to just these causes. In that subsection, the legislature notes that it
was not its current intent to "include recreational uses or currently existing
commercial uses involving fishing or other renewable marine or ocean resources
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within the uses and activities [that require review as] set forth in RCW
43.143.030." RCW 43.143.010(5). However, this language leaves open the
possibility that these other recreational and commercial uses could be covered in
the future. By leaving this opening, the legislature indicated that it considered, and
left available, the possibility of incorporating activities other than offshore drilling
under ORMA. This signals the broad spectrum of activities the legislature
intended the statute to cover. Because of this, RCW 43.143.010(5) indicates that
the legislature did not intend to preclude respondent's projects from undergoing
ORMA review.
The policy encapsulated in ORMA is to carefully review development
projects that involve nonrenewable resources and pose a risk of damage to the
environment in Washington's sensitive coastal waters. Respondents' projects
clearly fall within that broad policy. The projects might pose a threat to the
coastline because of the massive quantities of fuel transferred from land to sea and
the risk of that fuel contaminating our environment.
Therefore, we find that the plain text of the statute expresses the intent that
respondents' projects be reviewed pursuant to ORMA.
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2. Respondents' Proposed Facility Expansion Projects QualifY as "Ocean
Uses" and "Transportation" under WAC 173-26-360(3) and (12)
Even ifthe statute were ambiguous, we could resolve the issue under DOE's
promulgated rules. If a statute is ambiguous, an agency's promulgated rules help
our interpretation because they '"fill in the gaps' where necessary to the
effectuation of a general statutory scheme." Hama Hama Co. v. Shorelines Hr'gs
Bd., 85 Wn.2d 441, 448, 536 P.2d 157 (1975). We apply our normal rules of
statutory construction to administrative rules and regulations. Cannon v. Dep 't of
Licensing, 147 Wn.2d 41, 56, 50 P.3d 627 (2002). This court further gives rules
and regulations promulgated by administrative bodies a rational and sensible
interpretation. !d. at 57. Here, DOE's own ocean management rules support the
conclusion that ORMA applies to respondents' projects.
A. Respondents' Projects Are "Ocean Uses"
DOE has established a set of ocean management mles that help determine
when ORMA applies to particular projects and proposals. In these rules, DOE
provides definitions for both "ocean uses" and "transportation." WAC 173-26-
360(3), (12). The parties contest whether respondents' projects fall under either
definition. We hold that these projects are contemplated under both definitions.
While we give agencies great deference to their interpretation of mles within
their area of expertise, we may substitute our interpretation of the law for that of an
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agency. Port of Seattle v. Pollution Control Hr 'gs Bd., 151 Wn.2d 568, 593, 90
P.3d 659 (2004). It is valid for an agency to "fill in the gaps" via statutory
construction as long as the agency does not effectively amend the statute. Hama
Hama, 85 Wn.2d at 448. In this case, DOE improperly contorted the statute when
it reasoned that respondents' projects are not "ocean uses" or "transportation." The
regulation defines "ocean uses" as
activities or developments involving renewable and/or nonrenewable
resources that occur on Washington's coastal waters and includes their
associated off shore, near shore, inland marine, shoreland, and upland
facilities and the supply, service, and distribution activities, such as
crew ships, circulating to and between the activities and developments.
WAC 173-26-360(3 ). Here, respondents' construction projects are designed to
increase petroleum storage and transportation through facilities built on the edge of
Grays Harbor. Such projects are precisely "developments involving ...
nonrenewable resources that occur on Washington's coastal waters." Id. DOE's
contrary interpretation incorrectly narrows the definition of"ocean uses," thereby
improperly altering the intent of ORMA.
Likewise, the Court of Appeals' holding that the projects were not ocean uses
was error. Quinault Indian Nation, 190 Wn. App. at 713. The terminals not only sit
as close as 160 feet from the water, but they extend over the water. See AR at 124,
228 (pipelines would connect the tank farms and overhang the water to load
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vessels in the port); see also id. at 757 (aerial picture of facilities indicating the
same). Because these projects sit on the shores of Grays Harbor and overhang the
water, we find that respondents' projects qualifY as"[ o]cean uses" pursuant to WAC
173-26-360(3). To conclude otherwise would permit DOE's interpretation of
ORMA to effectively amend the statute by substantially narrowing its scope.
Both DOE and the city of Hoquiam argue that the definition of"ocean uses"
does not apply to respondents' projects because these projects do not literally sit on
Washington's coastal waters. As explained above, this argument misreads RCW
43.143.030, which states that uses involving nonrenewable resources on Washington
coastal waters that require permits, and that will adversely impact navigation or other
ocean or coastal uses, must first meet ORMA's review criteria. Further, DOE and
the city's argument ignores DOE's own rule stating that local governments "may
permit ocean or coastal uses and activities as a substantial development . . . only if"
ORMA's criteria are met. WAC 173-26-360(6) (emphasis added). Accordingly,
because these projects are developments that use nonrenewable resources and are
situated on Washington's coast, we find that they qualifY as "ocean uses."
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B. Respondents' Projects Are "Transportation"
Respondents' projects also constitute "transportation" under DOE's ocean
management regulations. Under DOE's ocean management framework, "ocean
transportation" includes
such uses as: Shipping, transferring between vessels, and offshore
storage of oil and gas; transport of other goods and commodities; and
offshore ports and airports. The following guidelines address
transportation activities that originate or conclude in Washington's
coastal waters or are transporting a nonrenewable resource extracted
from the outer continental shelf off Washington.
WAC 173-26-360(12) (emphasis added). In this case, an integral part of
respondents' projects is loading petroleum products onto ocean vessels to be shipped
to refineries. Neither party disputes this fact. This is clearly a transportation activity
that "originate[s] or conclude[s]" in Washington's coastal waters. Id. The activity
must originate or conclude in Washington's waters or include a nonrenewable
resource from Washington's continental shelf; it need not do both. Id. However, the
Court of Appeals held that the projects cannot be "transportation" because they are
not '"ocean use[s]. "' Quinault Indian Nation, 190 Wn. App. at 714.
We find instead that respondents' projects are "ocean uses" and thus also
qualify as "transportation." Once built, these projects will result in an estimated
310 percent increase in vessel traffic through Grays Harbor annually. Indeed, the
expanded facilities would be served by three separate modes of transportation:
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water, rail, and truck. Therefore, respondents' terminals constitute "transportation"
because they serve no other purpose than to facilitate and increase the movement of
petroleum products across both the ocean via tanker ships and land via rail.
3. Respondents' Proposed Facility Expansion Projects Are "Coastal Uses"
under WAC 173-26-360(6)
While the parties dispute whether the projects are "ocean uses" under the
WAC, neither party has addressed whether the projects qualify as "coastal uses"
under WAC 173-26-360(6). Though no party has discussed this provision in their
briefing, we have the "inherent authority to consider issues not raised by the parties
if necessary to reach a proper decision." Alverado v. Wash. Pub. Power Supply
Sys., 111 Wn.2d 424, 429, 759 P.2d 427 (1988). Here, it is clear that the language
of the regulation, if applied to respondents' proposals, would trigger ORMA
revtew.
DOE's rules read in relevant part, "[l]ocal govermnent and the department
may permit ocean or coastal uses and activities as a substantial development,
variance or conditional use only if the criteria ofRCW 43.143. 030(2) listed below
are met. ... " WAC 173-26-360( 6) (emphasis added). "Coastal use" is not defined
in DOE's ocean management rules, nor is it defined in ORMA. To determine the
meaning of an undefined term, we may look to standard English dictionaries.
Kitsap County v. Allstate Ins. Co., 136 Wn.2d 567, 576, 964 P.2d 1173 (1998). In
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standard English, "coast" means "land immediately abutting the sea" and "coastal"
means "of or relating to a coast" or "located on or near a coast." WEBSTER's
THIRD NEW INTERNATIONAL DICTIONARY 433 (2002). In this case, it makes
common sense to conclude that the respondents' proposed terminal expansion
projects on the shores of Grays Harbor constitute "coastal uses" pursuant to WAC
173-26-360(6). Based on the plain meaning of the text, DOE intended ORMA to
be considered before permitting construction projects along Washington's shores
or coasts. Therefore, we hold that the administrative rules clearly intended its
development projects, both ocean and coastal, be reviewed under ORMA.
Respondents' argument that ORMA does not apply to their projects because
they are not "ocean uses" ignores the fact that ORMA does apply to "coastal uses"
under both the statutory and administrative frameworks. Both ORMA and DOE's
promulgated rules for ocean management plainly include coastal uses. The Court
of Appeals erred when finding that ORMA does not apply to respondents' projects
because they are not "ocean uses." In doing this, the Court of Appeals reads
"coastal use" out of the statute entirely. Even if one could find that these projects
do not qualify as "ocean uses" under ORMA, respondents make no argument that
their projects are not "coastal uses" under either the RCWs or WACs.
Respondents cannot argue that their projects are not "ocean uses" and then ignore
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their qualification as "coastal uses" simply to evade ORMA review. Indeed, the
construction sites sit on the shores of Grays Harbor, as close as 160 feet from the
Chehalis River. Because respondents' projects abut the waters of both Grays
Harbor and the Chehalis River, these projects constitute "coastal uses" pursuant to
WAC 173-26-360(6).
CONCLUSION
The issue here is whether respondents' proposed expansion of fuel storage
terminals on the shores of Grays Harbor require review under ORMA. We hold that
they do.
First, the plain language ofRCW 43.143.030 shows the legislature intended
ORMA to apply in this case. The purpose ofORMA is to carefully review
development projects that involve nonrenewable resources and pose a risk of
damage to the environment in Washington's coastal waters. Because the entire
purpose of respondents' projects is to store and transfer fuel from Washington's coast
to Washington's waters, the projects fit squarely within ORMA's broad reach.
Second, the proposed terminal expansion projects also qualifY as"[ o]cean uses" and
"transportation" as defined in WAC 173-26-360(3) and (12). These projects will
increase transportation of petroleum products over land and sea. To say they do not
constitute ocean uses or transportation would be to improperly narrow the intent of
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the law. Finally, although not addressed by the parties, respondents' proposed
projects qualify as "coastal uses" under WAC 173-26-360(6). A plain reading of the
rule shows respondents' projects constitute coastal uses because they are facilities
situated along the waters of Grays Harbor and involve using the coast to store and
transport fossil fuel products.
Accordingly, we reverse the Court of Appeals and remand the case for further
proceedings consistent with this opinion.
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WE CONCUR:
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