Town of Arcadia Lakes v. South Carolina Department of Health & Environmental Control
Docket: Appellate Case No. 2010-159446; No. 5095
Court: Court of Appeals of South Carolina; March 5, 2013; South Carolina; State Appellate Court
The Town of Arcadia Lakes and various individuals are appealing an Administrative Law Court (ALC) decision that upheld the South Carolina Department of Health and Environmental Control's (DHEC) authorization of land-disturbing activities coverage under a State General Permit. The case involves Roper Pond, LLC, which owns a 12.75-acre property in Richland County, including 1.8 acres of wetlands under the jurisdiction of the Federal Clean Water Act (CWA). Roper submitted plans in 2007 for a multifamily development, requiring a permit for stormwater discharges due to land-disturbing activities, as mandated by South Carolina law. Roper opted for coverage under a general permit to expedite the process instead of applying for an individual permit.
DHEC issued the State General Permit, which allows stormwater discharges from construction projects until the site is stabilized. Roper was also required to obtain a wetlands permit from the Corps of Engineers to fill jurisdictional wetlands on the site. Under the CWA, the Corps can issue Nationwide Permits (NWPs) for activities with minimal environmental impact, allowing for quicker processing compared to individual permits.
On March 12, 2007, the Corps issued Nationwide Permits (NWP) 29 and 39, applicable to residential and commercial/institutional developments, respectively. These permits necessitate a 404 permit from the Corps, which in turn requires water quality certification under Section 401 of the Clean Water Act to ensure discharges into navigable waters comply with federal and state standards. On May 11, 2007, the South Carolina Department of Health and Environmental Control (DHEC) issued 401 certifications for projects under NWPs 29 and 39, mandating that project reviews consider both direct impacts and effects on adjacent water bodies or wetlands.
On April 30, 2008, George Whatley, a wetland scientist, submitted a joint application for a construction project on Roper’s property, indicating a planned filling of 0.075 acres of jurisdictional wetlands. A pre-construction notification (PCN) was submitted on May 5, 2008, which noted a reduction in impact area from 0.099 acres. Whatley stated that best management practices would be implemented to protect non-permitted areas. Although no other water quality impacts were disclosed, subsequent communications revealed plans to lower Roper Pond’s elevation and discharge soil and sediment into an upland area. The Corps confirmed that lowering the pond was not considered an impact and that excavation would be exempt from permitting if the material was properly managed.
A Stormwater Pollution Prevention Plan (SWPPP) was prepared on June 26, 2008, and DHEC requested revisions. On September 9, 2008, the Corps informed Whatley that the project would not result in significant adverse environmental effects and complied with NWP 39 conditions, requiring Roper to obtain necessary state certifications. The Corps also shared this determination with DHEC and Whatley. On September 24, 2008, Roper submitted a notice of intent to DHEC for stormwater discharges related to the Roper Pond Apartments project, seeking coverage under the State General Permit.
The project site encompasses 12.8 acres, with 9.9 acres designated for land-clearing. DHEC's October 2, 2008 correspondence indicated minimal water quality impacts from the project, consistent with a prior 401 certification for NWP 39, subject to certain unspecified conditions. On November 17, 2008, DHEC engineer Jill Stewart raised concerns regarding the proposed lowering of Roper Pond's water surface elevation for stormwater management. BP Barber confirmed the wetlands consultant stated this action was permissible under NWP 39. In December 2008, DHEC approved the revised SWPPP and granted Roper coverage under the State General Permit for stormwater discharges. Subsequently, on December 30, 2008, Appellants requested a review of DHEC's decision, citing issues such as the failure to disclose the water elevation change and potential misapplication of NWP. DHEC declined a review conference, allowing aggrieved parties to seek a contested case hearing, which the Appellants filed on February 16, 2009. Meanwhile, on January 6, 2009, Whatley requested a correction to indicate coverage under NWP 29. The Corps confirmed on February 25, 2009, that the project would have minimal adverse effects and met NWP 29 criteria, sending a copy to DHEC. However, DHEC did not issue a new authorization letter for NWP 29. DHEC's Section Manager stated that Roper's activities complied with conditions for both NWP certifications, negating the need for prior notification before proceeding under NWP 29.
On June 17, 2009, the ALC issued a consent order dismissing all claims by Appellants regarding the 401 certification and NWP 39 authorization for the proposed Roper Pond Apartments, while leaving intact claims related to NWP 29. A contested case hearing occurred on September 3-4, 2009, with testimony from Appellants, including expert witness Seth Reice, Ph.D., who expressed concerns about the excavation's impact but ultimately admitted his views were conjectural and lacked direct experience with excavation impacts. On January 21, 2010, the ALC upheld DHEC’s approval for the project's State General Permit, ruling that Appellants lacked standing to challenge this decision. After a temporary stay of the order, the ALC denied Appellants' motion for reconsideration on April 1, 2010, leading to their appeal. The appeal raises three primary issues: the ALC's ruling on Appellants' standing, the sufficiency of the 401 certification for a valid 404 permit, and the coverage of Roper's stormwater control activities under the State General Permit. The appellate court's review standards are governed by the South Carolina Administrative Procedures Act, allowing reversal or modification of ALC decisions if they violate statutory provisions, exceed authority, or are clearly erroneous or arbitrary. The precedent established in Bailey v. S.C. Dep’t of Health, Envtl. Control is cited regarding standing and review standards.
The appellants in this case include the Town and residents from Kaminer Station and Cary Lake. The Administrative Law Court (ALC) determined that none of these groups had standing to pursue the action, a conclusion that is affirmed. Standing is a critical legal requirement, and in the absence of a specific statute granting standing, constitutional standing criteria must be met. The Supreme Court of South Carolina outlines three essential elements for establishing standing: (1) the plaintiff must show an "injury in fact" that is concrete, particularized, and actual or imminent; (2) there must be a causal link between the injury and the defendant’s conduct; and (3) it must be likely that a favorable ruling would remedy the injury. The burden of proof rests with the party asserting standing.
The ALC found that the Town failed to demonstrate a personal stake in the litigation, as it did not establish an injury in fact. The ALC cited a precedent stating that municipalities must claim an infringement of their proprietary interests or statutory rights to have standing. Appellants argued for a broad interpretation of "proprietary interest," asserting that the Town's interests in environmental quality of Cary Lake, compliance with federal regulations, maintenance of desirable community attributes, and protection of property values constituted sufficient injury to confer standing.
The Town lacks standing in this case, as its asserted interests—whether proprietary or otherwise—are insufficient. Mayor Richard Thomas testified that the Town does not own Cary Lake and claimed, without supporting authority, that the Town is responsible for the water flowing from it. He acknowledged the Town's lack of maintenance responsibility, absence of allocated funds, and no incurred fines under NPDES regulations despite past issues with water flow. The Town's role is limited as Cary Lake is the final reservoir for six other lakes. The Appellants failed to provide evidence that the best management practices (BMPs) under the SWPPP would be inadequate to prevent sediment from leaving the construction site, and they did not demonstrate that their alleged injuries were fairly traceable to the actions challenged. The Administrative Law Court (ALC) affirmed that the Town lacks standing under section 1-23-610.
Regarding the Kaminer Station Appellants, the ALC found they did not establish an injury in fact related to the permitting decision or a causal connection to their alleged injuries. Linda Jackson, a Kaminer Station Appellant, acknowledged that water flows downhill and did not express serious concern about stormwater from Roper Pond affecting her area. Although she noted the visual and recreational value of Roper Pond and observed negative changes in Cary Lake, such claims, while possibly valid, do not automatically confer standing, especially since the affected water bodies are privately owned. The court reiterated that recreational or aesthetic injuries must be concrete and particularized, but cannot be assumed when the property is not owned by the plaintiffs. The ALC's determination that a causal link between the Kaminer Station Appellants' injuries and the permitting decision was not established is supported by substantial evidence.
Roper’s attorney questioned Jackson about potential injuries from land-disturbing activities under the State General Permit, to which she stated uncertainty regarding management. Jackson acknowledged that her dissatisfaction with past construction stemmed from permit violations rather than the permits themselves. Reice’s inability to provide a definitive impact assessment on pond dredging supported the Administrative Law Court's (ALC) conclusion that the Kaminer Station Appellants did not satisfy the standing requirement.
The ALC also found that the Cary Lake Appellants failed to demonstrate actual or imminent injury from DHEC’s coverage decision for Roper Pond Apartments under the State General Permit. Elaine Starr, a witness for the Cary Lake Appellants, testified about her long-term residence near Cary Lake, her educational background in biology, and her concerns regarding water quality and water lilies due to dredging. Despite her observations of declining water quality linked to past mismanagement, she could not connect these issues to the current project, having not reviewed the Stormwater Pollution Prevention Plan (SWPPP) and lacking specific challenges to DHEC’s findings regarding the SWPPP’s adequacy.
Additionally, the ALC noted that the complaints from both the Kaminer Station and Cary Lake Appellants pertained to privately owned bodies of water, which did not constitute injuries in fact. Consequently, the ALC deemed the evidence of potential injury from DHEC's decision to be speculative.
Regarding the validity of the 401 certification, the Appellants contended it was insufficient for Roper to obtain a 404 permit based on several points: (1) the 401 certifications for projects under NWP 29 or NWP 39 did not cover pond excavation as it was not disclosed in Roper's 404 permit application; (2) the project allegedly failed to comply with general conditions requiring DHEC to consider impacts on all lands and adjacent waters; (3) DHEC did not issue a formal certification confirming water quality compliance under NWP 29; and (4) DHEC neglected to conduct a required review for water quality regulation compliance.
None of the allegations presented justify overturning the Administrative Law Court's (ALC) finding that Roper possessed a valid 401 certification for its project. Although Roper initially failed to inform the Corps about the dredging and excavation of the pond, this information was provided by January 6, 2009, leading the Corps to conclude that the project would result in minimal environmental effects and comply with NWP 29. The Appellants correctly assert that DHEC's water quality certification review should encompass the entire project area under single ownership, not just the directly impacted land; however, the 401 certification was only a prerequisite for obtaining a 404 permit for filling jurisdictional wetlands, as mandated by federal law (33 U.S.C. § 1341(a)(1)). The Appellants did not contest the need for a 404 permit for the pond's dredging and excavation, nor did they claim it would discharge into navigable waters. Their concerns regarding impacts were focused solely on the pond, and since Roper, as the property owner, would logically be the party to address any impacts, it would be unreasonable for Roper to object to its own project. The Appellants also argued that the project lacked proper water quality certification under NWP 29; however, while a follow-up letter from DHEC would have been beneficial, it was not a requirement for the validity of the certification already granted. The Corps confirmed Roper's project eligibility under NWP 29, and DHEC had issued the necessary 401 certification, rendering the lack of additional documentation inconsequential to the project's compliance.
Appellants challenged the water quality certification on two main grounds: (1) DHEC's failure to assess compliance with specific regulations under the South Carolina Pollution Control Act, and (2) the impact of draining and excavating Roper Pond. They argued that the ALC incorrectly relied on a precedent stating that a stormwater permit under the Stormwater Act cannot be denied based on Pollution Control Act regulations. However, it was determined that the Corps was aware of Roper's intent to excavate the pond when it granted coverage under NWP 29, and the 401 certification from DHEC met the requirements for the 404 permit.
Regarding the State General Permit, Appellants presented two arguments against Roper's entitlement to coverage, both of which were rejected. They reiterated that the 401 certification was insufficient for a 404 permit, a prerequisite for the State General Permit. The ALC had already established that the 401 certification was adequate for NWP 29 coverage. Appellants also argued that the excavation would classify the pond as a water control structure, necessitating a 404 permit and a 401 certification. However, since the ALC did not address this issue and it was not preserved for appellate review, it could not be considered.
Ultimately, the court affirmed the ALC's ruling that Appellants lacked standing to contest Roper's coverage under the State General Permit and upheld the ALC's decision that Roper was entitled to that coverage. The court noted the regulatory framework governing the NPDES Permit Program under the Clean Water Act, emphasizing the requirement for certification from DHEC before federal permits are granted.
DHEC has the authority to issue, deny, or revoke general certifications related to activities governed by federal dredge and fill permits. A State 401 water quality certification, or its waiver, is necessary before issuing nationwide permits (NWPs) for activities that could lead to discharges into U.S. waters, as mandated by the Clean Water Act (CWA). The CWA defines "navigable waters" as including "waters of the United States," a term clarified by the Supreme Court to limit coverage to wetlands with a continuous surface connection to such waters. In this case, there is agreement that the 0.075 acres of wetlands affected by the project qualify as "jurisdictional wetlands" under the CWA. The Notice of Intent (NOI) was submitted on a DHEC form related to stormwater discharges. The Home Builders Association of South Carolina submitted an amicus curiae brief arguing that the Appellants are unnecessarily complicating stormwater regulation, which could harm the construction industry and public interests. However, the court chose not to address these policy issues since the resolutions of the presented legal questions are sufficient to decide the appeal, following precedent that allows appellate courts to avoid discussing unresolved issues when prior issues are dispositive. The Appellants from the Kaminer Station and Cary Lake projects are named, with the court noting that the Administrative Law Court (ALC) did not determine whether a "public importance" exception could grant standing to the Appellants, a point not raised in their brief. Additionally, the Appellants referenced section 1342(p) of the CWA, which pertains to stormwater discharges, but the court found no requirement for municipalities to obtain new permits for discharges already covered under existing permits.
