CADDNAR

[CITE: Indiana Coal Council Status of SMCRA Renewal Mitigation, 5 CADDNAR  135 (1990)]

 

 

[VOLUME 5, PAGE 135]

 

Cause #: 89-266R

Caption: Indiana Coal Council Status of SMCRA Renewal Mitigation
Administrative Law Judge: Lucas
Attorneys: Noland and Joest; Spicker
Date: September 5, 1990

ORDER

 

Summary judgment is granted as follows:

 

(1) The renewal of a permit to engage in surface coal mining and reclamation is subject to compliance with IC 13-4.1-5-4(b).

 

(2) A renewal can be denied subject to IC 4-21.5-3-5(g) where the Director establishes upon written findings that the existing permit does not require a minimization of disturbances and adverse impacts on fish, wildlife, and related environmental values and does not, where practicable, enhance those values as required by IC 13-4.1-8-1(23). As an alternative to the denial of a permit renewal, the Director may require a mitigation plan which achieves conformance with IC 13-4.1-8-1(23).

 

(3) The Department is not, as a matter of law, when a permit renewal is reviewed prohibited from correcting an error made previously in its interpretation of IC 13-4.1-8-1(23). That the Department is bound to an erroneous interpretation of IC 13-4. 1-8-1(23) made when the original permit was issued, based upon detrimental reliance, estoppel or a similar concept, is an affirmative defense which the applicant must plead and establish, in law and in fact.

FINDINGS OF FACT

 

1. By letter dated December 11, 1989, the Indiana Coal Council, Inc. ("ICC") filed a request for a special status determination under 310 IAC 0.6-1-15.

 

2. 310 IAC 0.6-1-15 provides as follows:

 

Sec. 15. (a) A person may, in writing, request the department to interpret a statute or rule administered by the department as applicable to a specific factual circumstance. The request must:

 

(1) describe with reasonable particularity all relevant facts;

(2) cite with specificity the statutory or rule sections in issue;

(3) identify any other person who may be affected by a determination of the request; and

(4) describe the relief sought.

 

(b) The ultimate authority for the department (or its delegate) may within forty-five (45) days provide a written response to the request. The response may set forth an interpretation based upon the information provided in the request or may specify additional information needed to respond to the request. If additional information is specified, the ultimate authority (or its delegate) has another forty-five (45) days to respond after the additional information is provided.

(c) If the department does not respond within the periods described in subsection (b), a general denial of the request is deemed to have resulted.

(d) If the person seeking the request under subsection (a) is aggrieved by the response of the department under subsection (b) (or if a response is not made within forty-five (45) days of the request), that person may file a petition for administrative review under IC 4-21.5-3. The response constitutes a determination of status under IC 4-21.5-3-5(a)(5).

(e) This section does not excuse a person from a requirement to exhaust another administrative remedy provided by statute or rule. A person may not under this section void or modify a final order entered by the department in another proceeding. A request under this section does not toll or extend any time limitation imposed on the availability of another administrative remedy. A final order of the department under this section which follows a contested proceeding under IC 4-21.5-3 provides the same precedent as a final order following any other contested proceeding under IC 4-21.5-3.

 

3. The description of relevant facts contained in the ICC letter of December 11, 1989 indicates that "[m]ost of the Indiana permanent program surface coal mining permits now in effect were issued during the period 1983-1985 for initial five-year terms. In the past year, many of these permits have been renewed, and for the next year or so many renewal applications will be considered. Recently,.... [ICC has] become aware that permits were being renewed subject to the condition that the applicant submit a 'plan to mitigate adverse effects of surface coal mining on fish and wildlife resources' .... where no such plan was required in the initial permit reclamation plan or during mid-term revision."

 

4. ICC asked in its December 11, 1989 letter if a plan to mitigate adverse effects of surface coal mining on fish and wildlife resources would be required for renewal permits under IC 13-4.1 "where no mitigation plan was required (or a different mitigation plan approved] in the original permit. In other words...[ICC is] asking whether the DNR intends to require new fish and wildlife mitigation activities in connection with the renewal of existing permits under IC 13-4.1.11.

 

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5. In its December 11, 1989 letter, ICC cited the following statutory or rule sections as being in issue: IC 13-4.1-3-4, IC 13-4.1-5-4(b), and 310 IAC 12-3-122(a).

 

6. Persons identified by ICC in the December 11 letter, as those which might be affected by a determination of the request for a special status determination under 310 IAC 0.6-1-15, were "[a]ll applicants for renewal of permits issued under IC 13-4.1 .... Additionally, landowners whose land is mined under such permits could be affected to the extent that a mitigation plan requires reclamation of land other than in accordance with the owner's wishes."

 

7. ICC stated in its December 11 letter that the relief sought was that "permits be renewed in accordance with IC 13-4.1-5-4(b) without new requirements being imposed on permittees except where necessitated by changes in applicable law."

 

8. The December 11, 1989 letter by ICC satisfied the requirements of 310 IAC 0.6-1-15(a).

 

9. On February 8, 1990, the director of the department of natural resources (the "Director") responded in writing to the December 11, 1989 letter by ICC.[FOOTNOTE]

 

10. In his February 8, 1990 letter, the Director stated that after "January 1, 1990, all applications for renewal must have adequate [fish and wildlife] mitigation plans incorporated into their permit applications to obtain a recommendation for approval." Pursuant to 310 IAC 12-3-125(a)(1) through (5), the department of natural resources would not approve a renewal application unless the additional revised or updated mitigation plan is supplied.

 

11. The February 8, 1990 letter from the Director to ICC constitutes the response anticipated by 310 IAC 0.6-1-15(b).

 

12. At issue in this proceeding is administrative review by ICC of the February 8, 1990 letter from the Director to the December 11, 1989 request by ICC for a special status determination under 310 IAC 0.6-1-15.

 

13. On May 1, 1990, ICC filed "Claimant's Motion for Summary Judgment". On June 18, 1990, the "Respondent Division of Reclamation's Reply to Petitioner's Motion for Summary Judgment" was filed. The "Petitioner's Reply Brief in support of Motion for Summary Judgment" was filed on July 20, 1990.

 

14. An examination of the record in this proceeding shows there is no genuine issue of fact in dispute; and a summary judgment may be rendered under IC 4-21.5-3-23 on all issues.

 

15. The department of natural resources (the "Department") must ask for pertinent information in an application for a permit to conduct a surface coal mining and reclamation operation under IC 13-4.1 and 310 IAC 12, and must require a reclamation plan. IC 13-4.1-3-3.

 

16. Among the many requirements to assure that surface coal mining operations are conducted to protect the environment is IC 13-4.1-8-1(23): "In addition to any other standards which the commission [now, the director] may require compliance with by a permittee, a permittee shall do as follows: .... (23) To the extent possible using the best technology currently available, minimize disturbances and adverse impacts of the operation on fish, wildlife, and related environmental values, and enhance those resources where practicable."

 

17. Information must be provided to the Department to demonstrate how a permittee will minimize disturbances and adverse impacts on the surface coal mining and reclamation operation on fish, wildlife, and related environmental values, and how the permittee will enhance those resources where practicable.

 

18. The information

 

[VOLUME 5, PAGE 137]

 

contained in a reclamation plan must be in the degree of detail necessary to demonstrate that reclamation required by IC 13-4.1 can be accomplished. IC 134.1-3-4(a).

 

19. The statutory mandate is illuminated by rule. 310 IAC 12-3-44 requires that an application must identify "[e]ach facility to be used to protect and enhance fish and wildlife and related environmental values." Additionally, where a permittee seeks to change the post-mining land use from what was approved in the permit, the permittee must seek approval of measures to prevent or mitigate adverse affects on fish, wildlife, and related environmental values. 310 IAC 12-5-68(c).

 

20. The standards for permit renewal are governed by IC 13-4.1-5-4. Most notably, subsection (b) establishes the structure for renewal:

 

11(b) After compliance with IC 13-4.1-4-1, IC 13-4.1-4-2, and IC 13-4.14-4, the commission [now the director] shall issue a renewal permit for the area within the existing permit unless it is established by opponents of the permit renewal and written findings are made by the commission [now the director] that:

 

(1) the terms and conditions of the existing permit were not satisfactorily met;

(2) the present surface coal mining and reclamation operation does not comply with IC 13-4.1-8;

(3) the renewal request substantially jeopardizes the operator's continuing responsibility on existing permit areas;

(4) the operator has not provided evidence that the performance bond in effect for his operation will continue in full force and effect for any renewal requested in the application as well as any additional bond the commission may require pursuant to IC 13-4.1-6; or

(5) the permittee has not provided the commission with any required additional revised or updated information."

 

21. IC 13-4.1-5-4(b) establishes a structure for the renewal of a permit to engage in a surface coal mining and reclamation operation which is significantly different from the structure which applies to the issuance of a new permit. The burden of persuasion to establish entitlement to a new permit rests under IC 13-4.1-4-3(a) with the applicant, but the burden of persuasion with respect to a renewal applicant rests after "compliance with IC 13-4.1-4-1, IC 13-4.1-4-2, and IC 13-4.1-4-4" with "opponents of the permit renewal" according to written findings by the Director. In addition, the grounds for denying renewal are limited to the five elements listed in IC 13-4.1-5-4(b).

 

22. The statutory structure of IC 13-4.1-5-4(b) is illuminated by rule within 310 IAC 12-3-122(a) which states in pertinent part: "Any valid, existing permit issued pursuant to the program shall carry with it the right of successive renewal upon expiration of the term of the permit, in accordance with 310 IAC 12-3-123 through 310 IAC 12-3-125."

 

23. The structure established by IC 13-4.1-5-4(b) and illuminated by 310 IAC 12-3-122(a) is harmonious with the administrative adjudication act with respect to permit renewals, generally, as stated in pertinent part in IC 4-21.5-3-5(g):

 

"If a timely and sufficient application has been made for renewal of a license with reference to any activity of a continuing nature and review is granted..., the existing license does not expire until the agency has disposed of a proceeding under this chapter (chapter 3 of the administrative adjudication act] concerning the renewal...."

 

24. An agency is not without legal recourse if continuation of the effectiveness of a permit through the administrative review if its renewal poses an emergency. IC 4-21.5-3-5(g) also provides that an agency may issue, "under IC 4-21.5-5-4, an emergency or other temporary order with respect to the license." With respect to a permit to engage in a surface coal mining and reclamation operation, emergency assistance might also be available in the form of a request for temporary relief.

 

25. Among the grounds set forth in IC 13-4.1-5-4(b) for which a permit renewal can be denied is a failure of the present surface coal mining operation to comply with IC 13-4.1-8, the statutory chapter which includes the subdivision [IC 13-4.1-8-1(23)] requiring a minimization of "disturbances and adverse impacts on the operation of fish, wildlife, and related environmental values, and... [the enhancement of] those resources where practicable."

 

26. A permit renewal sought under IC 13-4.1-5-4(b) can be denied if it is established, and written findings are made by the Director, that the present surface coal mining and reclamation operation under the permit does not minimize disturbances and adverse impacts of the operation on fish, wildlife, and related environmental values, or does not enhance those values where practicable.

 

27. Where the statutory authority exists within an agency to prohibit an activity, the authority also exists to condition the conduct of the activity upon compliance with a mitigation plan. See, for example,

 

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DNR v. Indiana Coal Council, Inc. (Ind. 1989), 542 N.E.2d 1000, 1006, U.S. cert. den. 110 S.Ct. 1130, where the Indiana Supreme Court held it "would be not only strange, but against all reason to conclude" that a determination by the Director to prohibit surface coal mining on a site was a "legitimate exercise of the police power" but providing an alternative to the prohibition was not a legitimate exercise of that power.

 

28. A renewal permit under IC 13-4.1-5-4(b) may require, as an alternative to denial, that the permit correct any deficiencies found in the present surface mining reclamation operation with respect to the duty to minimize disturbances and adverse impacts of the operation on fish, wildlife, and related environmental values or to enhance those resources where practicable.

 

29. The Director has asserted that the reason for requiring an "adequate mitigation" plan, as a term for granting a renewal, is that a mistake was made by the Department in issuing permits before August 15, 1985. The mistake asserted is one of a statutory interpretation by the Department in finding that mitigation plans for fish and wildlife were required only on state and federally-owned property.

 

30. The consideration of a permit renewal pursuant to IC 4-21.5-5-4 is an appropriate opportunity to correct errors made by the Department in the interpretation of IC 13-4.1-8, since a determination of noncompliance by the present surface coal mining reclamation operation with IC 13-4.1-8 can form the basis for a denial of the renewal.

 

31. If the Director establishes, as documented by written findings under IC 13-4.1-5-4(b), that the present surface coal mining and reclamation operation of a renewal applicant does not minimize disturbances and adverse impacts on the operation of fish, wildlife, and related environmental values (or enhance those values where practicable) due to an error by the agency in interpreting IC 13-4.1-8-1(23) when the original permit was issued, then the Director may condition the renewal upon implementation of a mitigation plan designed to achieve compliance with the statutory mandates of IC 13-4.1-8-1(23). The burden of persuasion for establishing nonconformance by a surface coal mining and reclamation operation rests with the Department. If a request for renewal is filed in a timely fashion, the permit does not expire until any contested proceeding under IC 4-21.5-3 is completed (subject to any emergency or other temporary order).

 

32. An argument by a renewal applicant to the effect that there has been reliance to its detriment upon an incorrect interpretation by the Department of IC 13-4.1-8-1(23) when the permit was issued originally, that the Department is now estopped from asserting an interpretation of IC 134.1-8-1(23) which is different from what was previously asserted, or a similar position constitutes an avoidance or matter of abatement and is an affirmative defense. The burden of persuasion and the burden of going forward with an affirmative defense rests with the party seeking its protection. IC 4-21.5-314(c). See, for example, Kuss v. DNR and Prudential Insurance, 5 Caddnar 51, 54 (July 12, 1989).

 

33. Generally, an affirmative defense depends upon the facts of a particular case; and the renewal applicant must plead and prove its affirmative defenses. The Department is not, as a matter of law, prohibited from correcting an interpretation of IC 13-4.1-8-1(23) if that interpretation was originally in error.

 

34. Standards for minimizing disturbances and adverse impacts on the operation of fish, wildlife, and related environmental values must be set forth by the Indiana General Assembly as a statute or by the Department as a rule. See for rules, generally, Indiana Department of Environmental Management  v. Amax, Inc., (Ind. App. 1988), 529 N.E.2d 1209; Peabody Coal Company v. NRC, 2 Caddnar 21 (Sept 27, 1984); and Great Lks. Coal Co. v. Dept., 2 Caddnar 12 (March 3, 1984). However, the Director's letter of February 8, 1990 does not establish standards which must be applied but merely requires compliance with the statutory pronouncements of IC 13-4.1-8-1(23) as currently interpreted. His letter of February 8, 1990 evidences no intention to implement a rule outside the statutory requirements for rule adoption.

FOOTNOTE:

 

310 IAC 0.6-1-15(b) specifies that the "ultimate authority" for the department of natural resources shall provide the written response to a request for a special status determination. On February 8, 1990, the Director might, arguably, have been the "ultimate authority" for a determination of the matters at issue in this proceeding. With the enactment of Public Law 28-1990, the natural resources commission (the "Commission") clearly becomes the "ultimate authority" for a resolution of any proceeding which applies IC 13-4.1 and 310 IAC 12. "Notwithstanding any other provision of law, the ... [C]ommission is the ultimate authority of the department of natural resources under IC 14-21.5." SECTION 23 of P.L. 28-1990, effective July 1, 1990, as codified at IC 14-3-3-21(a). Even subsequent to July 1, 1990, the Director would, however, appear to be the appropriate person to respond to a special request for a status determination. Public Law 28 placed the responsibility in the Director for making all initial licensing determinations for the department of natural resources (except those made under IC 14-3-3.4). Although a special status determination under 310 IAC 0.6-1-15 is probably not a license, the legislative intent expressed by P.L. 28 is best served by having the initial response prepared by the Director with administrative review to the Commission.