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PRESIDING JUDGE:

Catherine Gibbs

PARTY REPRESENTATIVES:

IDEM: = Denise Walker, Esq.

Petitioner: = Anton and Christina Verwayen, pro se

ORDER ISSUED:

November 15, 2010

INDEX CATEGORY:

Water

FURTHERE CASE ACTIVITY:

[none]

[2010 OEA 2= 00, page 201 begins]

STATE OF INDIANA &= nbsp; &nbs= p; ) &= nbsp; &nbs= p; BEFORE THE INDIANA OFFICE OF

&n= bsp; = ; &n= bsp; = ; ) &= nbsp; &nbs= p; ENVIRONMENTAL ADJUDICATION

COUNTY OF MARION &= nbsp; )<= /p>

IN THE MATTER OF: &= nbsp; &nbs= p; &= nbsp; &nbs= p; &= nbsp; )

&n= bsp; = ; &n= bsp; = ; &n= bsp; = ; &n= bsp; )

OBJECTION TO THE EXPIRATI= ON OF INDIVIDUAL = )

NPDES/CAFO CONSTRUCTION P= ERMIT &= nbsp; &nbs= p; )

ANIMAL WASTE NO. AW-5807 = /FARM ID NO. 6523 ) &= nbsp; CAUSE NO. 10-W-J-4377

FAR HILLS DAIRY LLC &= nbsp; &nbs= p; &= nbsp; &nbs= p; )

CASS COUNTY, INDIANA &= nbsp; &nbs= p; &= nbsp; &nbs= p; )

FINDINGS OF FACT, CONCLUSIONS OF LAW AND FINAL ORDER<= /u>

<= /span>This matter came before the Court on the hearing of the Petition for Review file= d by Far Hills Dairy LLC; the Court having read the record, heard the testimony = and other evidence, now enters the following findings of fact, conclusions of l= aw and final order.

Summary of Decision

<= /span>Far Hills Dairy LLC (the Petitioner) has appealed the Indiana Department of Environmental Management (the IDEM)’s decision that the Petitioner did not begin construction of its CAFO on time and that its operating permit has expired. The main issue in this matter is whether the work completed by the Petitioner before September 11, 2009 was “construction” as defi= ned by I.C. § 13-11-2-40.8. The IDEM maintains that the work was site preparation as the Petitio= ner had not started construction of approved manure control equipment. The Petitioner maintains that this= work qualifies as construction. Th= e ELJ finds in favor of the IDEM in this matter.=

FINDINGS OF FACT

1. &n= bsp; On August 27, 1007, the IDEM issued National Pollut= ant Discharge Elimination System (NPDES) Concentrated Animal Feeding Operation (CAFO) Individual Permit INA006523/AW-5807 (the Permit) to Far Hills Dairy = LLC, the Permittee and the Petitioner in this matter. The Permit became effe= ctive September 11, 2007. Jt. Stipulation 2.

&nb= sp;

2. &n= bsp; The Permit authorized the construction and operatio= n of a concentrated animal feeding operation (CAFO) at CR 1000 North and CR 1000 West, Cass County, = Indiana (the Site). Jt. Stipulation 1.

&nb= sp;

3. &n= bsp; I.C. § 13-18-10-2.2 and the Permit required the Petitioner to begin construction no later than 2 years after the effective = date of the Permit. In this case, construction should have begun no later than September 11, 2009. Jt. Stipulation 3 and 4.

[2010 OEA 2= 00, page 202 begins]

4. &n= bsp; The IDEM received a Construction Notification Form = on June 11, 2008. Jt. Stipulated Exhibit 2, Jt. Stipulation 8.

5. &n= bsp; Prior to May 25, 2010, the following construction h= ad been completed at the Site: a= silt fence was installed; the entire facility was surveyed and staked out; 5,200= feet of filter tile was installed in order to drain the building pad area; pads = for the confinement barns were excavated and compacted in preparation for concr= ete; the main drives were excavated and ready for stone. Petitioner’s Exhibit A, Affidavit of Anton Verwayen.

6. &n= bsp; Construction changes were proposed to the IDEM on August 1, 2008 and approved on November 21, 2008. Petitioner’s Exhibits.

7. &n= bsp; The IDEM conducted inspections of the Site on July = 1, 2008 and May 13, 2010. Stipulation 9.

8. &n= bsp; On May 25, 2010, the IDEM notified the Petitioner t= hat the Permit had expired due to Petitioner’s failure to begin construct= ion before September 11, 2009.

9. &n= bsp; The Petitioner timely filed its petition for review= on June 10, 2010.

10. A hearing was held on October 27, 2010.[1]

Applicable Law

= ; The Indiana Department of Environmental Management (IDEM) is authorized to implement and enforce specified Indiana environmental laws and rules promulgated relevant to those laws, pursuant to I.C. § 13. The Office of= Environmental Adjudication (“OEA”) has jurisdiction over the decisions of the Commissioner of the IDEM and the parties to this controversy pursuant to I.= C. § 4-21.5-7-3. <= /u>

= ; This office must apply a de novo standard of review to this proceeding wh= en determining the facts at issue. Indiana Dept. of Natural Resources v. Uni= ted Refuse Co., Inc., 615 N.E.2d 100 (Ind.<= /st1:place> 1993). Findings of fact must = be based exclusively on the evidence presented to the ELJ, and deference to the agency’s initial factual determination is not allowed. Id.; I.C. § 4-21.5-3-27(d). Further, OEA is required to base i= ts factual findings on substantial evidence. Huffman v. Office of Envtl. Adjud., 811 N.E.2d 806, 809 (Ind. 2004) (appeal of = OEA review of NPDES permit); see also I.C. § 4-21.5-3-14; I.C. § 4-21.5-3-27(d).

&nb= sp;

        &= nbsp;   [2010 OEA 200, page 203 begins]

            <= /span>Both the Permit and I.C. § 13-18-10-2.2 require that a permittee begin construction of a CAFO within two (2) years of the effective date of the permit. Construction is defin= ed by I.C. § 13-11-2-40.8 as:

"Co= nstruction", for purposes of I.C. § 13-18-10, means the fabrication, erection,= or installation of a facility or manure control equipment at the location where the facility or manure control equipment is intended to be used. The term d= oes not include the following:

(1)&= nbsp; The dismantling of existing equipment and control devices.

(2)&= nbsp; The ordering of equipment and control devices.

(3)&= nbsp; Offsite fabrication.

(4)&= nbsp; Site preparation.

            <= /span>This case requires that the Court interpret the meaning of “site preparati= on.” When construing a statute or regul= ation, the Court must apply certain rules of statutory construction.    The first rule is that= when a statute or regulation is clear and unambiguous on its face, the court does not need to “apply any rules of construction other than to require th= at words and phrases be taken in their plain, ordinary and usual sense.” St. Vincent = Hosp. & Health Care Ctr., Inc. v. Steele, 766 N.E.2d 699, 703-704 (Ind. 2002); Bourbon Mini-Mart, Inc. v. Commissioner, Indiana Department of Environmental Manage= ment, 806 N.E.2d 14 (Ind.Ct.App. 20= 04); I.C. § 1-1-4-1(1). If the court determines that the wording of the rule or statute is unambiguous, it= is not subject to interpretation. The = Court may consult with English language dictionaries to ascertain a word’s common and ordinary meaning. = Fort Wayne Patrolmen's Benevolent Ass'n v. City o= f Fort Wayne,= 903 N.E.2d 493 (Ind. Ct. App. 2009).

            <= /span>However, if the Court determines that there is ambiguity, then other rules of statut= ory construction shall be applied. “If a statute is subject to interpretation, our main objectives are to determine, effect, and implement the intent of the legislature in su= ch a manner so as to prevent absurdity and hardship and to favor public convenience.” State v. Evans, 790 N.E.2d 558, 560 (Ind. App., 2003)= . “The meaning and intention o= f the legislature are to be ascertained not only from the phraseology of the stat= ue but also by considering its nature, design, and the consequences which flow= from the reasonable alternative interpretations of the statute. Statutes relating to the same gene= ral subject matter are in pari materia<= /i> and should be construed together so as to produce a harmonious statutory scheme.” State v. Hensley, 716 N.E.2d 71, 76 (Ind. Ct. App. 1999).

&n= bsp;

“Site preparation” is not defined. “Preparation” is defined by Merriam-Webster as follows:<= o:p>

1: the action or process of making something ready for use or s= ervice or of getting ready for some occasion, test, or duty

2: a state of bei= ng prepared: readiness

3: a preparatory act or measure

[2010 OEA 2= 00, page 204 begins]

4: something that is prepared; specifically: a medicinal substance= made ready for use <a preparation for colds>

            <= /span>“Prepare” is defined as “to make ready beforehand for some = purpose, use, or activity”. 2010 Merriam-Webster, Incorporated, http://www.merriam-webster.com/dictionary.

        &= nbsp;   Manure control equipment is not defined. However, "waste management system" is defined by 327 IAC 16-2-44 as “any method of managing manure at the confined feeding operation, including:

<= span style=3D'mso-list:Ignore'>(1)&= nbsp; manure storage structures;

<= span style=3D'mso-list:Ignore'>(2)&= nbsp; manure transfer systems;

<= span style=3D'mso-list:Ignore'>(3)&= nbsp; manure treatment systems, such as:=

<= span style=3D'mso-list:Ignore'>(A)&= nbsp; a constructed wetland;

<= span style=3D'mso-list:Ignore'>(B)&= nbsp; a vegetative management system;

<= span style=3D'mso-list:Ignore'>(C)&= nbsp; a wastewater treatment system under a valid national pollutant discharge elimination system (NPDES) permit; or

<= span style=3D'mso-list:Ignore'>(D)&= nbsp; anot= her system approved by the commissioner;

<= span style=3D'mso-list:Ignore'>(4)&= nbsp; feedlots;

<= span style=3D'mso-list:Ignore'>(5)&= nbsp; confinement buildings; or

<= span style=3D'mso-list:Ignore'>(6)&= nbsp; waste liquid handling, storage, and treatment systems.”

    &nbs= p;       “Manure storage structure” is defined by 327 IAC 16-2-24 as “any = pad, pit, pond, lagoon, tank, building, or manure containment area used to store= or treat manure, including any portions of buildings used specifically for man= ure storage or treatment.”

CONCLUSIONS OF LAW

1.      The OEA has subject matter jurisdiction to h= ear the petitions for review as the petitions for review request review of a decision made by the IDEM Commissioner.&nb= sp; Further, the Court concludes that the petitions were timely filed.

2.      There is no question that the Petitioner has= done a considerable amount of work at the Site.= However, the question is whether the work completed by the Petitioner qualifies as “construction” as defined by I.C. § 13-11-2-40.8.

=

3.      The IDEM maintains that the work was “= site preparation” as the Petitioner had not started “construction of= an approved manure control equipment.”[2] IDEM argues that any work done to prepare the site for the construction of the manure control equipment is “site preparation”. Further, IDEM argues that “manure control equipment” has= the same definition as “waste management system”. IDEM bases its interpretation on w= hether the IDEM has the authority to cite the permittee for violations relating to= the completed work. If the IDEM h= as no

=

[2010 OEA 2= 00, page 205 begins]

=

reg= ulatory authority over how the work must be done, then the IDEM considers the work = to be site preparation. The fact= that the permit contains specifications for the work does not necessarily mean t= hat the IDEM has the authority to take enforcement action for a failure to meet those specifications.

=

4.      The statute is clear that not all of the wor= k at a CAFO that might be considered construction, as that term is commonly used, qualifies as “construction” as defined by I.C. § 13-11-2-4= 0.8 for purposes of meeting the construction deadline.

=

5.      The Petitioner cites to the amount of money spent on the work done at the Site. However, the statute does not reference monies expended as a qualifi= er for construction. Moreover, t= he statute specifically excludes certain activities that might require the expenditure of large sums of money such as the ordering of equipment or off= site fabrication. The Petitioner&#= 8217;s argument that the amount of money spent is relevant is not persuasive.

=

6.      The Petitioner also makes the point that no = effort was made to contact the Petitioner to verify what work had been completed at the Site prior to expiring the permit.&nbs= p; However, the IDEM did inspect the Site once (May 13, 2010) after the construction deadline. Moreov= er, the rules do not require such verification.

=

7.      I.C. § 13-11-2-40.8 is unambiguous in t= hat it applies to the construction of a facility or manure control equipment. If one reads the statutes and rule= s in pari materia, it is clear that “facility or manure control equipment” means the same as “waste management system”.&nbs= p;

=

8.      Further, the definition of “waste management system” is clear that only structures used for manure stor= age or treatment are manure control equipment.= So, it is clear that the installation or construction of any compone= nts of a farm that are not directly related to manure storage or treatment is s= ite preparation and does not count as “construction” of manure cont= rol equipment.

=

9.      The storm water management system is not par= t of the waste management system. = The purpose of the storm water system is to keep uncontaminated storm water from coming into contact with the manure or any part of the waste management sys= tems. In the early stages of constructio= n, such systems also serve to dewater a site so that construction may occur. The permit applicant submits the d= etails of how storm water is diverted from the production area to the IDEM for its approval, but these details are not mandated by the IDEM. The Permit requires that a Storm W= ater Pollution Prevention Plan be drafted and maintained at the Site but does not require IDEM’s approval.  =

=

[2010 OEA 2= 00, page 206 begins]

=

10. The IDEM’s CAFO authority does not ext= end to the construction of storm water management systems. While it is true that the IDEM can= take enforcement action in the event that the storm water systems fail, the basi= s of the enforcement action is not the failure to construct the system to certain specifications, but the release of contaminants into the environment.

11. Therefore, the construction of structures us= ed for control of uncontaminated storm water, including but not limited to, digging of an exploratory trench to locate field tiles, the rerouting of fi= eld tiles, installation of drains, culverts, or detention ponds, does not quali= fy as construction under I.C. § 13-11-2-40.8 as none of these structures = are used for the actual storage or treatment of manure or process wastewater.        =

=

12. Further, driveways, silt fences and surveyin= g clearly are not part of the waste management system. None of these structures are used = for the actual storage or treatment of manure or process wastewater and do not qualify as construction under I.C. § 13-11-2-40.8.

=

13. On May 7, 2010, the IDEM sent out a message = via electronic mail[3]= that iterated its interpretation of “construction”. The pertinent portion of this e-ma= il relating to construction states, “a facility is not considered to have started construction unless, they have started construction of an approved manure control equipment and in the location it was approved to be placed.<= span style=3D'mso-spacerun:yes'> The construction is also expected = to meet the approved design specifications and any requirements established by= the agency and within the approval. Items that will not be considered starting construction for the purp= ose of I.C. § 13-18-10-2.2 are as follows; installation of a concrete pad = in the wrong location and not meeting agency design specs, installation of a p= ost, flags or markers delineating structure locations or drainage tiles and, site preparation including driveway construction and installation of utilities.”

=

14. This communication is not decisive of the is= sues in this case because (1) it was sent after the Petitioner’s construct= ion deadline had passed; (2) there is no indication in the email whether this w= as published as a non rule policy document pursuant to I.C. § 13-14-1-11.= 5; and (3) OEA proceedings are de novo= so IDEM’s interpretation is not entitled to any deference. However, this email is useful for clarifying the IDEM’s interpretation. The IDEM’s interpretation is consistent with the ELJ’s conclusions relating to clean storm water systems and other structures described in Conclusions of Law 6 and 7 above.

=

15. The only construction that may qualify as co= nstruction of manure control equipment is the preparation of the soil pad for the confinement barns. The pads (= also referred as the sub base and sub grade) are necessary for the proper construction of the barns and other structures. The pads are an important part of = the construction of the confinement barns, which are clearly part of the waste management system. The IDEM d= oes not make any argument that the confinement barns are not part of the waste management system. However, t= he IDEM

=

[2010 OEA 2= 00, page 207 begins]

=

arg= ues that the construction of the pads is not regulated by the IDEM, unlike the construction of the actual structure, including the concrete floor which si= ts upon the pad.
=

16. The specifications for the soil pad are prop= osed by the applicant. The IDEM re= views and approves these specifications for the purpose of ensuring that the waste management system, as designed, will perform as required. However, the ELJ can find no speci= fic regulations requiring that the pads meet certain specifications. In contrast, there are regulations= that specify design requirements for the actual manure storage and treatment structures, depending on whether the manure is liquid or solid and whether = the structure will be concrete or earthen.

17. The Merriam-Webster definition supports a conclusion that the soil pads are “site preparation”. The soil pads are installed in ord= er to prepare for the pouring of the concrete structure, that is, “to make ready beforehand for some purpose, use, or activity&#= 8221;. The installation of the soil pads = serves no other purpose than to prepare the area for the construction of some component of the manure management system.

=

18. The installation of soil pads in preparation= for the pouring of the concrete manure management systems is not construction as defined by I.C. § 13-11-2-40.8.

=

19. The Petitioner has failed to meet its burden= of proof in this matter. Far Hil= ls Dairy LLC failed to begin construction of the manure management system prio= r to April 10, 2009. NPDES CAFO Individual Permit #INA006523/AW-5807 has expired.        =             &nb= sp;

FINAL ORDER

      = ;      IT IS THEREFORE ORDERED, ADJUDGED AND DECREED that the Petition for Review fil= ed by Far Hills Dairy LLC is hereby D= ISMISSED. Judgment is entered in favor o= f the Indiana Department of Environmental Management.

            <= /span>You are hereby further notified that pursuant to provisions of I.C. § 4-21.5-7-5, the Offic= e of Environmental Adjudication serves as the Ultimate Authority in the administrative review of decisions of the Commissioner of the Indiana Department of Environmental Management.&nb= sp; This is a Final Order subject to Judicial Review consistent with applicable provisions of I.C. § 4-21.5. Pursuant to I.C. § 4-21.5-5-5= , a Petition for Judicial Review of this Final Order is timely only if it is fi= led with a civil court of competent jurisdiction within thirty (30) days after = the date this notice is served.

IT IS SO ORDERED th= is 15th day of November, 2010 in = Indianapolis, IN.

Hon. Catherine Gibbs
Environmental Law Judg= e

&n= bsp;

[2010 O= EA 200: end of decision]

&n= bsp;

2010 OEA 200 in .doc format

2010 OEA 200 in .pdf format