[NOTE: THIS CASE WAS TAKEN ON JUDICIAL REVIEW TO THE DAVIESS CIRCUIT COURT (14COl-9310-MI-263) ON OCT. 19, 1993, BUT SUBSEQUENTLY DISMISSED BY STIPULATION].
A civil penalty assessment of $420 is imposed for violation N21215-S-2. A civil penalty assessment of $1,400 is imposed for violation N21228-S-45, part 1 of 4. A civil penalty assessment of $1,600 is imposed for N21228-S-45, part 2 of 4. A civil penalty assessment of $1,600 is imposed for violation N21228-S-45, part 4 of 4.
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 regulating surface coal mining operations within the state.
5. At all times relevant to these proceedings, Green Construction of Indiana ("Green") held permits S-2 and S-45 issued by the DNR which allowed Green to conduct surface coal mining operations in Daviess County, Indiana.
6. In April of 1992, Solar Sources, Inc. entered into a contract with Green to take over the above mining operations (and others). The permits remain in Green's name but all the participants in the hearing process were employees of Solar Sources and there are transcript references to Solar Sources. Since Green is still the permittee, all references to the mining operation in these findings will be to Green.
7. on December 15, 1992, the DNR issued notice of violation N21215-S-2 (NOV I) to Green for a violation at the S-2 permit site.
8. On December 28, 1992, the DNR issued a four part notice of violation N21228-S-45 (NOV II) to Green for violations occurring at the S-45 permit site.
9. In January of 1993, the DNR assessed civil penalties for both NOVs.
10. Green filed requests for review pursuant to IC 4-21.5 as to the amount of the penalties assessed for NOV 1 (93-045R) and parts 1, 2, and 4 of NOV II (93-046R, 93-047R, and 93-048R).
11. The civil penalty assessments were consolidated for hearing by agreement.
12. Pursuant to the Indiana Supreme Court's decision in Indiana Department of Natural Resources v. United Refuse Company, Inc., (1993, Ind. Sup. Ct.) 615 N.E.2d 100, the administrative law judge must review these matters "de novo", that is, he must assume the role of the initial decision maker rather than review the reasonableness of the DNR penalty assessment.[FOOTNOTE 1]
13. The DNR assessed a penalty of $800 for NOV I.
14. The DNR assessed penalties of $1,900, $1,200, and $1,600 for part 1, part 2, and part 4 of NOV II, respectively.
15. Civil penalty assessments ("CPA") for mining violations are governed by a rigid point system. See 310 IAC 12-6-11, through 310 IAC 12-6-1.5.
16. Green does not challenge most of the penalty points assessed by the DNR.
17. In NOV I, Green contests the assessment of points for seriousness and negligence.
18. NOV I was written for failure to restore all affected areas in a timely manner in accordance with the approved post-mining land use.
19. At issue was the failure to remove basins or submit a request for a post-mining land use change to allow the basins to remain.
20. The NOV was abated by submitting a request for a change of post-mining land use as the landowner wanted the pond to remain.
21. The inspector had discussed the problem with the mine on prior inspections and had given the mine a date by which to file a land use change. The DNR was aware of the fact all interested parties wanted the pond permitted.
22. When the paperwork was not submitted by the date specified, the inspector wrote the NOV.
23. 310 IAC 12-6-12(b) deals with the number of points to be assessed for seriousness.
24. After hearing the sworn
[VOLUME 7, PAGE 9]
testimony of the parties, the administrative law judge concludes that 310 IAC 12-6-12(b)(3) applies. The true basis for this violation appears to be the failure of the mine to submit paperwork, a violation of an administrative requirement for which 0 to 15 points should be assessed.
25. The failure of Green to submit the paperwork within the (reasonable) time frame set by the inspector was caused by the failure of the engineering firm preparing the plans to finish them by the deadline and not because the mine was not interested or concerned or ignoring the inspector.
26. Green correctly points out that the failure to contact the DNR before the deadline date to explain the situation was a mistake.
27. 310 IAC 12-6-12(c) discusses the points to be assessed for negligence.
28. The mine's actions show a lack of diligence or reasonable care and thus expose it to an assessment of 0 through 12 penalty points.
29. The standard for assigning points for seriousness is the extent to which enforcement was obstructed by the failure to submit the land use change timely or discuss an extension of the deadline, with the inspector. The worst of all possible cases requires an assessment of 15 points. Absolutely no obstruction of enforcement justifies an assessment of 0 points.
30. Because of the number of times the inspector talked to the mine about getting this area into compliance, a higher point assessment is justified.
31. The administrative law judge now assigns ten penalty points for seriousness.
32. If the carelessness involved is almost "recklessness" as defined in 310 IAC 12-6-12, 12 points should be assessed.
33. The evidence presented does not show the conduct of the mine to be close to recklessness.
34. In fact, the mine had instructed the engineering firm to prepare appropriate plans and was awaiting the appropriate documents, which arrived soon after NOV I was issued thus abating the violation.
35. Under these circumstances, the number of points that should be assessed is 7, a value halfway between "no carelessness" and "maximum carelessness but not recklessness.
36. The total points assessed for this violation should be 4 + 10 + 7 = 21 points.
37. 310 IAC 12-6-12.5 requires a CPA of $420 be imposed for a 21 point violation.
38. CPA for NOV I should be reduced from $800 to $420.
39. Part I of NOV II was written for an effluent violation at a siltation structure.
40. The DNR assessed a penalty of $1,900, based on 39 penalty points.
41. Green again objected to the points assessed for seriousness and negligence.
42. The evidence showed that the mine over treated an acetic basin and ended up with an alkaline discharge with a pH of approximately 10.
43. Discharge limits are governed by an NPDES permit because the discharge eventually ends up in waters of the United States.
44. 310 IAC 12-6-12(b)(1) and (2) discuss the points to be assessed for seriousness.
45. 310 IAC 12-6-12(2) requires that 8 - 15 points be assessed if the danger extends outside the permit area. In this case, the minimum of 8 points is appropriate because a discharge having a 10 pH in an acetic watershed has a very low chance of doing damage but will extend off the permit area.
46. The probability of damage occurring on or off the permit area is insignificant. Because the pH is more than 1.0 higher than the NPDES limit, more than the absolute minimum points under 310 IAC 12-6-12(b)(2) should be assessed. The range is 1 - 4 points.
47. The administrative law judge concludes that 2 points should be assessed for this category.
48. As to negligence, the pond in question is monitored bimonthly because of acid drainage.
49. A routine check of pH by the mine led to treatment with alkaline substances.
50. The pond was over treated.
51. As far as negligence points go (310 IAC 12-6-12(c)) there is certainly no evidence of willfulness or callous disregard.
52. Green has attempted to keep any discharge in compliance.
53. There is some evidence of lack of reasonable care.
54. The range of possible penalty points is 0 - 12.
55. The number of points that should be assessed should fall in the lower range of negligence.
56. The administrative law judge assesses 4 penalty points for negligence for this violation.
57. The total number of penalty points assessed for part I of NOV II is 30 + 2 + 8 + 4 = 34.
58. 310 IAC 12-6-12.5 requires a CPA of $1,400 be assessed.
59. Accordingly, the CPA assessed by the DNR for part I of NOV 11 is reduced from $1,900 to $1,400.
60. Part 2 of NOV II was written for failure to protect topsoil from wind and water erosion and failure to protect exposed surface areas.
61. Again, Green objected to the number of points assessed for seriousness and negligence.
62. Evidence introduced by the mine showed that there was a crew assigned to do nothing but protect exposed areas, which in
[VOLUME 7, PAGE 10]
December means placing straw or mulch.
63. Because of the small area involved here, the area in question was a low priority to the mulching crew.
64. Further, the topsoil which was displaced by erosion was not necessarily lost; just removed to an adjoining flat area.
65. It appears from the evidence that the loss of any significant amount of topsoil is unlikely, hence pursuant to 310 IAC 12-6-12(b)(1), 5 points should be assessed for probability of occurrence.
66. It also appeared from the evidence that whatever damage which did or could occur would be restricted to the permit areas.
67. If the potential damage is restricted to the permit area, 310 IAC 12-6-12(b)(2)(i) requires an assessment of 0 - 7 points, depending on the duration and extent of the damage.
68. In this particular case, the extent of the damage was slight and that reclamation can still be readily accomplished.
69. The administrative law judge therefore assesses 2 points for extent of damage.
70. The actions of the mine in assigning a crew to erosion control and prioritizing do not indicate conduct close to recklessness and therefore an assessment of recklessness points at or near the 12 point maximum is not justified.
71. On the other hand, the fact that the mine was still working on exposed, nonvegetated areas in late December means that negligence points in the upper half of the 0 - 12 point range is appropriate.
72. The administrative law judge now assesses 9 points for negligence.
73. The total point assessment for part 2 of NOV 11 is 20 + 5 + 2 + 9 = 36 points.
74. 36 points corresponds to a CPA of $1,600.
75. Accordingly, the CPA of $2,100 assessed for part 2 of NOV II is reduced to $1,600.
76. Part 4 of NOV II was written for failure to pass surface drainage from disturbed areas through an approved siltation structure before leaving the permit area.
77. Green only contests the number of points assigned for negligence.
78. The area in question was an area in which the mine needed to get a small area drainage exemption.
79. The mine attempted to control drainage by hay bales. It did not work well. There was some confusion caused by a typographical error in the permit.
80. Inspection reports of prior inspections introduced into evidence indicated the DNR had called the need for a drainage exemption to the mine long before the NOV was written.
81. The conduct of the mine shows a lack of diligence or reasonable care to a degree near the maximum of negligence as set forth in 310 IAC 12-6-12(c).
82. The total number of points assessed for part 4 of NOV II remains unchanged.
83. The CPA for part 4 of NOV II remains $1,600.
FOOTNOTES
1 This represents a change in approach by administrative law judges in penalty cases. Prior administrative decisions seem to rely on the "reasonableness" of the agency determination of penalties rather than taking a completely de novo approach. See Peabody Coal Company v. DNR, 5 Caddnar 205 (1991).