Update (July 31, 2015): This week, the Minnesota Supreme Court has affirmed the Court of Appeals decision, discussed below, in which Minnesota Court of Appeals Judge Margaret H. Chutich issued a dissent. (Judge Chutich found ambiguity in a regulatory scheme (calling for judicial deference to agency interpretation) where the Minnesota Supreme Court saw none.)
Environmental lawyer, Thad Lightfoot, suggested in the earlier post that affirmance of the Court of Appeals’ decision would pose thorny problems of federal and state regulatory cooperation and collaboration. We’ll see how they navigate around this judicially (or legislatively?) created mire.
Here is what Mr. Lightfoot has to say about the Supreme Court’s decision:
As I wrote back in August 2104 when the Minnesota Supreme Court granted review of the case, the issues were whether Reichmann needed a National Pollutant Discharge Elimination System (NPDES) permit under federal Clean Water Act regulations governing concentrated animal feeding operations and a State Disposal System (SDS) permit under a similar Minnesota statute. MPCA said he needed both, Reichmann argued he needed neither, and the Court of Appeals held he did not need an NPDES permit but needed an SDS permit. The Minnesota Supreme Court affirmed. It relied on the Court of Appeals’ analysis for the NPDES permit issue but found that Reichmann needed an SDS permit under a slightly different interpretation than that employed by the Court of Appeals.
There are three interesting aspects to this case. The first is that the Minnesota Supreme Court granted review but then affirmed the Court of Appeals, albeit on different grounds for the SDS permit holding. When the Minnesota Supreme Court grants review, particularly in an environmental matter, it almost always reverses some aspect of the Court of Appeals’ opinion. Granting review and then affirming, even on slightly different grounds, is unusual.
Second, there is no dissent in the case. Although that is not shocking, there was a persuasive dissent by Judge Chutich in the Court of Appeals on the NPDES issue and I expected that issue to be more controversial than it appeared to be in the Minnesota Supreme Court. Given two plausible readings, Judge Chutich determined the Clean Water Act regulation was ambiguous and would have deferred to the EPA preamble to the final rule, which suggests that the Reichmann winter feeding field requires an NDPES permit. In the Minnesota Supreme Court, MPCA cited the EPA preamble to the final rule, the EPA preamble to the proposed rule, and dicta from a Second Circuit case, all of which supported MPCA’s interpretation of the regulation to require an NDPES permit. But all seven Minnesota Supreme Court justices found that the Clean Water Act rule was unambiguous on its face and did not require Reichmann to obtain a permit. The Court refused to consider external sources in interpreting the regulation. Writing for the Court, Justice G. Barry Anderson observed that an EPA preamble “does not have the force of law” and that if EPA intended the regulation to extend to winter feeding facilities, it could have amended the regulation.
Third, EPA’s reaction to the case will be interesting. MPCA clearly believes that EPA intended the federal Clean Water Act regulation to apply to winter feeding facilities such as Reichmann’s. The Minnesota Supreme Court has now held that the federal regulation, which MPCA is delegated to implement and enforce in Minnesota under the Clean Water Act, does not apply. MPCA is bound by the Minnesota Supreme Court’s interpretation of the regulation, which appears to differ from EPA’s interpretation. Of course, EPA could amend the regulation, as Justice Anderson suggested. But amending national Clean Water Act regulations is no easy task.
Original post (August 22, 2014) (under the headline: Environmental Lawyer, Thad Lightfoot, on an Upcoming Minnesota Supreme Court Environmental Case): I find myself stymied by multiple trash cans in cafeterias, asking me to separate “trash” from “recyclables.” As such, I figure I have to renounce any claim to any background or experience in environmental law. For environmental law, call someone else, like Thad Lightfoot. Few, if any, Minnesota lawyers have the depth of experience, generosity, kindness, and wisdom of environmental lawyer, Thad Lightfoot.
So I was delighted when Thad agreed to share his comments and thoughts with Minnesota Litigator on a recent Minnesota Court of Appeals decision that the Minnesota Supreme Court has decided to review (In The Matter of Reichmann Land & Cattle, LLP).
Lightfoot sets up the background:
There are two permits at issue here. The issue is whether Reichmann must have a National Pollutant Discharge Elimination System (NPDES) permit under the federal Clean Water Act and a State Disposal System permit under Minnesota law. MPCA said that he needed both, and he appealed that final decision to the Court of Appeals by a petition for a writ of certiorari. Reichmann argued that he did not need either permit. The Court of Appeals held that he did not need an NPDES permit under the plain language of the federal (EPA) rule implementing the Clean Water Act. But it also held that he needed a State Dispose System (SDS) permit under the plain language of a Minnesota statute. An NPDES permit is a federal permit but is issued by the state of Minnesota, because EPA has delegated its authority to the state. An SDS permit is a state permit, period. And the “pasture” exemption only applies to the SDS permit. A facility needs a federal NDPES permit if it is an “Animal Feeding Operation” (AFO). An area is not an AFO under the Clean Water Act if crops, vegetation, forage growth, or post-harvest residues are “sustained in the normal growing season for any portion of the lot or facility.” So, the key under the NPDES permit is whether Reichmann “sustained” crops or vegetation at the winter feeding fields. The Court of Appeals held that he did, so he did not meet the definition of an AFO and did not need an NDPES permit.
Lightfoot explains:
The Minnesota Supreme Court granted MPCA’s petition for review on the Court of Appeals’ holding that Reichmann did not need an NPDES permit under the Clean Water Act and granted Reichmann’s petition on the issue of whether winter feeding fields are ‘pasture’ under Minnesota law. So the Minnesota Supreme Court will review both substantive holdings of the Court of Appeals, because if Reichmann’s fields are ‘pasture’ he is exempt from obtaining a State Disposal System (SDS) permit.
These issues will require the Minnesota Supreme Court to interpret a federal rule to resolve the NPDES permit question and a state statute to resolve the SDS permit question. The NPDES permit question is more the difficult, in my judgment, and the issue drew a persuasive dissent from Judge Chutich. The majority found that the federal rule was unambiguous and therefore did not consider an EPA preamble that suggests the Reichmann winter feedlot facility requires an NPDES permit. Judge Chutich, in contrast, found two plausible interpretations of the regulation’s plain language, depending upon whether the term “sustained” means that crops must merely be maintained (as Reichmann argued) or must be able to withstand weight or pressure (as MPCA argued). Given two plausible readings, Judge Chutich determined the regulation was ambiguous and would have deferred to the EPA preamble.
One thing is certain. Under EPA’s interpretation of its own NDPES regulations, Reichmann’s winter feedlot facility would require an NPDES permit. If the Minnesota Supreme Court upholds the Court of Appeals’ opinion, MPCA will lack the authority to implement the NDPES program in the manner that EPA intended. That could pose some interesting cooperative federalism problems for both EPA and MPCA, because EPA under the Clean Water Act has delegated to MPCA the authority to issue federal NDPES permits in the state of Minnesota.
It seems to me that clean water, winter, cattle, and complex questions of federalism matter to all Minnesotans (in order of importance?) and we are fortunate to have folks like Thad Lightfoot and the Minnesota Supreme Court to help sort it out when it is way over the heads of the rest of us in the herd.