[NOTE: JUDICIAL REVIEW WAS TAKEN IN GIBSON SUPERIOR COURT (26D0l-9310-MI-0012). ON SEPTEMBER 23, 1996, SOLAR FILED MOTION TO DISMISS FOR FAILURE TO PROSECUTE. PARTIES REACHED AN AGREEMENT, AND ON NOVEMBER 13, 1996, GIBSON SUPERIOR COURT GRANTED MOTION AND DISMISSED WITH PREJUDICE.]
The civil penalty assessment for notice of violation N20624-S-89 is hereby reduced from $1,200 to $700.
FINDINGS OF FACT
1. The Indiana Department of Natural Resources ("DNR") is an agency within the meaning of IC 4-21.5.
2. IC 4-21.5, IC 13-4.1, and 310 IAC 12 apply to these proceedings.
3. The administrative law judge is the ultimate authority within the meaning of IC 4-21.5 with respect to these proceedings.
4. The DNR is the state agency charged with the responsibility of the regulation of surface coal mining operations.
5. At all times relevant to these proceedings, Solar Sources, Inc. ("Solar") held permit S-89 issued by the DNR which allowed the surface mining of coal at the Sky-Point mine in Gibson and Warrick Counties in Indiana.
6. On June 24, 1992, a duly authorized representative of the DNR issued notice of violation N2067-4-S-89 ("NOV") to Solar during a monthly compliance inspection of the Sky-Point mine.
7. The NOV alleged problems with sediment control.
8. Solar did not contest the issuance of the NOV.
9. On July 28, 1992, the IDNR assessed a civil penalty of $1,300 against Solar for the NOV.
10. Solar requested an informal review of the civil penalty and an assessment conference was held on August 18, 1992.
11. As a result of the assessment conference, the DNR reduced the penalty to $1,200.
12. On or about September 10, 1992, Solar received the IDNR's final assessment of penalty.
13. On September 25, Solar filed a timely request for review of the civil penalty assessment ("CPA") of $1,200.
14. A CPA under IC 13-4.1 and 310 IAC 12 ("I-SMCRA") is fairly inflexible and based on a point system. See 310 IAC 12-6-11 through 310 IAC 12-6-12-5.
15. In calculating the number of penalty points, the DNR assessed a total of 32 points which corresponds to a $1,200 CPA.
16. Solar does not contest the number of points assessed for history of violation (3) or the failure of the DNR to award good faith points.
17. At issue are the assessment of 9 points for probability of occurrence of harm, 8 points for the extent of potential or actual damage, and 12 points for negligence.
18. In light of the decision of the Indiana Supreme Court in Indiana Department of Natural Resources v. United Refuse Company (1993), 615 N.E.2d 100, the administrative law judge must hear this matter "de novo" and use his own judgment based on the evidence at the hearing to assign penalty points in contested areas rather than merely examining the decision of the DNR to see whether or not it was reasonable.
19. The NOV was issued for failure to maintain diversion discharge and inlet structures in order to prevent enlargement of stream channels and minimize disturbance of the hydrological balance.
20. The main basis for the violation was the damage done to rip rap in part caused by a heavy rainfall.
21. There is no evidence that the construction in the area failed to conform to the designs approved by the DNR in the permit.
22. 310 IAC 12-6-12(b)(2) sets forth the number of penalty points that should be assessed for potential or actual damage.
23. If the damage or impact which the violated standard is designed to prevent extends outside the permit area, eight points must be assigned at the minimum.
24. Since the run off enters into Smith's Fork Creek, there is the potential for off-permit damage as a result of this violation.
25. Fortunately, there was no actual damage off the permit area.
26. An eight point minimum assessment for this category is
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appropriate.
27. 310 IAC 12-6-12(b)(1) deals with the appropriate point assessment for probability of occurrence of harm
28. The potential harm that the regulations are attempting to prevent is excessive erosion and suspended particle effluent problems in the discharge.
29. Photographs entered into evidence show that there is some probability of occurrence of damage.
30. The probability appears to be more than insignificant (1-4 points) and close to the borderline of unlikely (5-9 points) and likely (10-14 points).
31. Since the rip rap was moved but not lost, the displaced rip rap still served some purpose and made repairing the problem easier than if there had been a complete loss of erosion control material.
32. The conclusion is thus drawn that nine points is an appropriate assessment for probability of occurrence.
33 310 IAC 12-6-12(c) deals with points to be assigned for negligence.
34. If a violation involves lack of due diligence, indifference, or lack of reasonable care, one to twelve points is assigned.
35. If a violation involves a conscious and unjustified disregard of the harm that might result, the conduct is recklessness and 13 to 19 points is assessed.
36. This area had a history of problems, but on cross examination of the DNR's witness, the mine established that repairs had been made to bring the diversion into compliance with the permit. The witness agreed that there was no reason to believe another "blow out" would occur.
37. To assign a point value in the 12 to 13 point range, the testimony must show a conscious disregard or carelessness almost to a point of conscious disregard of potential harm.
38. No one disputes that the measures taken to abate the violation have worked and the diversions conform to the permit specifications.
39. While the witnesses for both parties may disagree to the extent a heavy rainfall (not a ten year event because it did not last long) contributed to the problem, both agree it was a contributing factor to the violation.
40. While it is true that the DNR had shown concern for this area in prior reports, the failure to plan for a rainfall such as the one described in the testimony cannot support finding of reckless or near reckless conduct on the part of the mine.
41. The number of points that should be assessed for negligence in this case is seven, about halfway between "no negligence" and "recklessness".
42. The total points for this violation should be 3 + 9 + 8 + 7 = 27.
43. A point assessment of 27 points translates into a CPA of $700. See 310 IAC 12-6-12.5.