[CITE: Squaw Creek Coal Company v. Commission, 2 CADDNAR 8 (1985)]
[VOLUME 2, PAGE 8]
Cause #: 84-053R
Caption: Squaw Creek Coal
Company v. Commission
Administrative Law Judge: Szostek
Attorneys: Joest; Spicker, DAG
Date: April 25, 1985
ORDER
[NOTE: THIS CASE WAS REVERSED
ON JUDICIAL REVIEW BY THE VANDERBURGH SUPERIOR COURT.]
The
Report of Hearing, Recommended Findings of Fact, Recommended Order of Hearing
Officer filed March 26, 1985 is adopted and approved as the Report, Findings of
Fact and Order of the Natural Resources Commission. It is adjudged and ordered,
for Condition (7) of Permit S-00008, Squaw Creek Coal Company, North Mine, that
Condition (7) is affirmed.
FINDINGS OF FACT
1.
The Natural Resources Commission (the Commission) is included in the definition
of the word agency, as used in IC 4-22-1-2, and is duly empowered to conduct
administrative hearings pursuant to IC 4-22-1.
2.
The Director of the Department of Natural Resources, acting for the Commission
may, pursuant to IC 13-4.1-2-2(c), delegate all or any of his powers and duties
assigned to him in this article to other employees of the Department.
3.
Steven J. Szostek is an employee of the Department.
4.
Squaw Creek Coal Company is a company licensed to do business in Indiana, with
an address at 20 Northwest First Street, P.O. Box 1112, Evansville, Indiana
47706.
5.
In a petition filed with the Commission April 5, 1984, Petitioner requested
administrative review of Permit S-00008, Condition (7).
6.
On April 10, 1984, the Director delegated the authority to make an
administrative review of Permit S-00008 to Steven J. Szostek.
7.
An administrative hearing on Permit S-00008 was held on October 30, 1984, in
Jasonville.
8.
Petitioner had proposed, as part of its reclamation plan for Permit S-00008, to
permanently cover part of a coal slurry waste area with water.
9.
Respondent rejected Petitioner's water cover plan and imposed Condition (7) in
Permit S-00008.
10.
The use of water as a permanent cover for coal waste is specifically precluded
by IC 13-4.1-8-1(10)(A)(i)
and 310 IAC 12-5-56.
11.
Petitioner had not applied to Respondent to use its water cover plan on an
experimental basis, as allowed under the Indiana surface coal mining program.
Disapproval of a plan for disposal of coal processing waste slurry
("slurry") proposed by Plaintiff in its permit application as amended
by Plaintiff prior to Defendants' decision.
[Editor’s Note: A review of the
archived administrative file did not result in an explanation for the
enumeration error.]
5.
On April 5, 1984, Plaintiff filed a request for administrative review of
Defendants' decision disapproving Plaintiff's slurry disposal plan and imposing
condition No. 7 on Plaintiff's permit.
6.
On October 30, 1984, a hearing was held on Plaintiff's request for
administrative review before a Hearing Officer appointed by Defendants.
7.
On March 26, 1985, the Hearing Officer filed with Defendants a report with
proposed
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findings and a recommended order
("report") disposing of Plaintiff's request for administrative
review. The report did not contain any finding (whether o not so denominated)
that Plaintiff's slurry disposal plan would not result in the safe and
effective disposal of slurry in the manner proposed by Plaintiff would result
in acid mine drainage, water pollution, or other environmental harm, nor any finding
that Plaintiff had not adequately justified the technical merits of its
proposal, The report did find, however, that disposal of the slurry in the
manner proposed by Plaintiff is specifically precluded by IC 13-4.1-8-1(10)(A)(i) and 310 IAC 12-5-56.
8.
The slurry proposed to be disposed of by Plaintiff is potentially acidic and
will acidify is exposed to oxygen for sufficient periods of time. Plaintiff's
slurry disposal plan called for placing the slurry in an impoundment, which was
a pit resulting from Plaintiff's mining operations and covering the slurry with
water. Water cover prevents the formation of acid by preventing oxidation of
the slurry.
9.
Plaintiff's witnesses testified that Plaintiff's slurry disposal plan would
result in the safe disposal of the slurry without acidification, acid mine
drainage, water pollution, or other environmental harm, that the principle of
preventing slurry acidification by water was scientifically recognized, and
that Plaintiff's disposal impoundment was properly designed to maintain water
cover over the slurry. Defendant's witnesses did not contradict this testimony
and the report made no finding to the contrary.
10.
The report specifically found that covering slurry or any other potentially
acid-forming material with water is prohibited by IC 13-4.1-8-1 (10)(A)(i) and 310 12-5-56.
11.
At its meeting on April 25, 1985, Defendants adopted the report as their final
decision affirming the imposition of condition No. 7 on Plaintiff's permit.
12.
On May 16, 1986, Plaintiff filed a verified petition for judicial review of
Defendant's decision in the Warrick Circuit Court. The judicial review action
was subsequently transferred to this Court on Defendant's motion for change of
venue.
CONCLUSIONS OF LAW
1.
This Court has jurisdiction over the parties and subject matter of this action.
2.
Defendants comprise a board or agency within the meaning of IC 4-22-1-2 and
their final decision described above constitutes an administrative
adjudication.
3. This
Court has jurisdiction over the parties and subject matter of this action.
4.
An administrative agency decision is required to be supported by specific fact
findings based on substantial evidence, and also "in accordance with
law", which means that the agency must follow proper legal procedures and
must correctly interpret applicable substantive law. An agency decision which
is substantially influenced by a misinterpretation of applicable substantive
law must be set aside.
5.
The only basis stated in Defendant's decision for disapproval of Plaintiff's
slurry disposal plan is that covering slurry with water is prohibited by IC
13-4.1-8-1(A)(i) and 310 IAC
12-5-56.
6.
IC 13-4.1-8-1 (10)(A)(i) provides that a surface mine
permittee shall: "(10) Minimize disturbances to
the prevailing hydrologic balance at the mine site and associated offsite areas
and to the quality and quantity of water in surface and ground water systems
during and after surface coal mining and reclamation operations by: (A) Avoiding
acid or other toxic mine drainage by such measures as, but not limited to: (i) preventing or removing water from contact with
toxic-producing deposits."
7.
Disposal of acid-forming materials is specifically governed by IC
13-4.1-8-1(14), which provides that a surface mine permittee
shall: "(14) Insure that all debris, acid-forming materials, toxic
materials constituting a fire hazard are treated, buried and compacted, or
otherwise disposed of, in a manner designed to prevent contamination of ground
or surface waters and contingency plans are developed to prevent sustained
combustion."
8.
Construing IC 13-4.1-8-1(10)(A)(i) and (14) together
and in accordance with the purposes of IC 13-4.1-1-2, the Court finds that IC
13-4.1-8-1(10)(A)(i) does not prohibit covering
slurry or other acid forming materials where doing so will not cause acid mine
drainage.
9.
310 IAC 12-5-56 provides: "All exposed coal seams remaining after mining
and acid-forming, toxic-forming, combustible materials, or any other waste materials
identified by the Director shall be covered with a minimum of four (4) feet of
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non-toxic and noncombustible
materials, or treated to neutralize toxicity in order to prevent water
pollution and sustained combustion, and to minimize adverse effects on plant
growth and land uses. When necessary to protect against upward migration of
salts, exposure by erosion, to provide an adequate depth for plant growth, or
to otherwise meet local conditions, the Director shall specify additional
treatment to neutralize potential acidity. Acid-forming or toxic-forming
material shall not be buried or stored in proximity to a drainage course so as
to cause or pose a threat of water pollution."
10.
310 IAC12-5-56 was repealed effective June 1, 1985, and replaced by 310 IAC
12-5-55.1(f). The former regulation was in effect at all times relevant to
Defendant's consideration of Plaintiff's slurry disposal plan. There is no
relevant difference between the former and present regulations which would have
any effect on the legality of Plaintiff's plan. The present regulation does
specify that any non-toxic, non-combustible material relied upon as cover must
be "earthen" but Plaintiff justified water cover on the basis that it
treated the slurry by preventing acidification, not that the water was
non-toxic, non-combustible cover material.
11.
Constructed consistently with IC 13-4.1-8-1(14) and with the purposes of IC
13-4.1, 310 IAC 12-5-56 does not prohibit slurry disposal by water cover where
such disposal would not result in acid mine drainage or water pollution.
12.
Defendant's decision cannot be sustained on any grounds not contained in their
findings. Defendants made no finding that Plaintiff's slurry disposal plan
would cause acid mine drainage or water pollution and there was no evidence
received at the administrative agency record which would have supported such a
finding had it been made.
13.
Defendant's decision was not in accordance with law and must be set aside.