Opinion
No. C3-00-854.
Filed January 23, 2001.
Appeal from the Department of Natural Resources, File No. 12-2000-12496-2.
Paul R. Haik, Louis A. Haik, (for relator Elden Brant)
Mike Hatch, Attorney General, Peter L. Tester, Assistant Attorney General, (for respondent Department of Natural Resources)
This opinion will be unpublished and may not be cited except as provided by Minn. Stat. § 480A.08, subd. 3 (2000).
UNPUBLISHED OPINION
The Commissioner of Natural Resources affirmed a restoration order issued for a violation of Minn. Stat. § 103G.245 (1998), alteration of a public water without a permit. Relator Elden Brant appeals, arguing that the commissioner's order was not supported by substantial evidence, deprived him of due process of law for failure of adequate notice, erroneously placed the burden of proof on relator, and exceeded the commissioner's statutory authority. We affirm.
FACTS
Elden and Dorothy Brant own 118 acres in Pine County, two miles east and one mile north of Hinckley. A roughly 1,400-foot length of Spring Creek crosses the Brant property, flowing from west to east. The creek is a spring- fed, cold-water stream that arises a mile west of the Brant property. As the creek flows through the Brant property, it has generally been one to three feet wide, a few inches deep, and fed by ground water along its length. The creek flows through a culvert under a farm road about 100 feet from the eastern edge of the property. The culvert had caused the creek to back up and form a pool west of the culvert, varying from 10 to 40 feet across. The creek joins the Grindstone River 4.9 miles downstream from the culvert.
The creek has been a "designated trout stream" since 1950 and is listed as such (under the name "Spring Brook") in Minnesota Rules. Minn. R. 6264.0050, subp. 4 JJ (1999). Respondent Department of Natural Resources (DNR) has managed the entire length of the creek as a trout stream for many years. Although no trout have been reported in the upper half of the creek, the DNR manages the upstream reaches and tributaries in order to protect downstream trout populations.
The Brants decided to build a wildlife pond on their property on the north side of the creek, near the culvert. The county told them they needed to file a notice with several agencies. On September 24, 1996, the Brants completed a project notification form and sent copies to the DNR regional office, the Army Corps of Engineers, and Pine County. The form described the project as excavation of two acres adjacent to Spring Creek to make a wildlife pond.
The DNR's Cambridge regional office received the project notification form on September 25, 1996. Mike Mueller, the area hydrologist, reviewed the form. It was unclear to Mueller how close to the creek the Brants intended to dig the pond. According to Mueller, Brant called him that day and described the project. Mueller told Brant that no DNR permit was required, but he should keep the pond at least 50 feet back from the creek. Brant said that would not leave him much room, so Mueller told him he could stay back just 25 feet. Although Brant does not specifically recall talking to Mueller, and denies being told to stay back 25 feet, the fact-finder credited Mueller's recollection.
Mueller sent the Brants a letter dated September 25, 1996, advising that since "the wetland is not under DNR permit jurisdiction," "the project does not require a DNR permit provided excavation is not connected to Spring Creek." The letter was a form letter Mueller used in such situations with a modification adding the phrase, "provided excavation is not connected to Spring Creek."
Kelly Osterdyk, a zoning technician at the Pine County Zoning Department, received the project notification form and a copy of Mueller's letter. On October 11, 1996, Osterdyk sent the Brants a letter stating that they would have to obtain a grading and filling permit. The letter stated that the permit was required under the county's shoreland management ordinance for the movement of more than 10 cubic yards of material within 75 feet of Spring Creek, a "tributary trout stream."
On October 30, 1996, the Corps of Engineers sent Elden Brant a letter stating that the project was authorized under an existing general permit and that unless another state or federal agency objected, he could proceed with the project.
On November 5, 1996, the Brants submitted their application for the grading and filling permit to Pine County. The application included a crude drawing of the project. It showed the excavation to be 400 feet long, 100 feet wide, four feet deep, bounded on the north by an embankment, and bounded on the south by Spring Creek. It showed no land between the creek and the excavation. It showed the roadway that passes over the culvert on the east and stated that approximately 6,000 cubic yards would be excavated. It did not show the location of the existing pool by the culvert.
Osterdyk reviewed the application and spoke with Elden Brant at some point, probably in conjunction with Richard Noyes of Pine County Soil and Water Conservation District. They told him not to dig in Spring Creek. On November 12, 1996, Noyes wrote Brant a letter on behalf of the soil and water conservation district, recommending leveling of the excavated soil and planting of certain grasses. On November 13, 1996, upon Osterdyk's approval, the County Zoning Administrator issued a grading and filling permit to the Brants for the project.
In September 1997, Brant started excavating the wildlife pond. He hired Jim Irons, a local excavator, to dig the pond. Brant told Irons to dig out the pond on the north side of the creek and not to dig in the creek. Irons used a large backhoe to dig out the pond. He tried to stay three or four feet away from the creek, but at times he got closer than that. At least twice the stream bed pulled away, and Irons pushed the material back into the break. He dredged out a pond on the north side about 480 feet long and 30 to 150 feet wide. Brant was there at times during the excavation and at times he was not.
After the pond on the north side was completed, Brant told Irons to dig another pond on the south side of the creek because he thought it would look nice. They thought that could be justified since they had not yet removed 6,000 cubic yards. Irons dug a pond on the south side of the creek, running from the same starting point on the west to the culvert on the east, a distance of about 400 feet. The south pond was 60 feet wide. Unlike on the north side, Irons left several feet of creek bank between the south pond and the stream, at least near the west end.
On September 19, 1997, Osterdyk visited the site to see if the work had been done. Irons was in the process of digging the south pond. Osterdyk told Irons that the work seemed to exceed the permit in that the north creek bank had been partially removed and there was a pond being dug on the south. Irons told Osterdyk that he had tried to save as much of the creek bank as possible but that clumps of the bank came out as he was digging. On September 24, Osterdyk spoke with Mueller about what he had found.
On September 29, 1997, Mueller and conservation officer Pete Jensen inspected the site. At that time, the ponds appeared essentially as one large pond with a narrow peninsula of land extending about 300 feet from the west along the former creek bed. The north and south ponds were connected at the east end in the area of the former pool by the culvert. Spring Creek flowed a ways onto the peninsula and then over the north side into the pond.
On October 23, 1997, Mueller wrote Brant a letter stating that Mueller and Jensen had inspected the property and observed that excavation had occurred in the creek channel. The letter stated that Spring Creek was a public water and designated as a trout stream, that Minn. Stat. § 103G.245 required a permit for the alteration of public waters, that Brant did not have a permit to excavate in Spring Creek, that Mueller had written Brant that no DNR permit was required provided the excavation did not connect to the creek, and that Mueller had advised him in a phone conversation to maintain a 25-foot buffer. The letter offered Brant the option of voluntarily restoring the bed of Spring Creek to a width of 75 feet on both sides of the original creek bed.
Brant called Mueller and arranged a meeting on the property. On November 5, 1997, the Brants, Mueller, Jensen, and Richard LaPierre of the DNR's Hinckley fisheries office met and discussed the requirement for 75 feet of fill on both sides of the creek bed. The Brants asked whether that requirement could be cut in half. After consulting with the area fisheries manager Roger Hugill, the DNR officials agreed to the change. In a November 12, 1997 letter, Mueller stated that the DNR had agreed to cutting the required in-fill distance in half, to 37.5 feet on both sides of creek bed. The letter included some other requested conditions for the restoration process and stated that, assuming the measures were acceptable, Brant was free to begin at the earliest opportunity.
A few weeks later, the Brants' attorney contacted Mueller and asked for another meeting. Barr Engineering was retained to work on the issue for the Brants. On January 13, 1998, Robert Obermeyer of Barr Engineering sent Mueller a letter stating that Barr's survey of the site indicated that the "hydrologic flow in the project area was not significantly changed" and suggesting alternatives for addressing concerns.
A meeting at the site occurred in February 1998. Barr representatives presented a survey drawing and proposed to restore the bank of Spring Creek with eight-foot wide berms that would separate Spring Creek from the ponds. Mueller did not think the proposal would be adequate but told Brant to go ahead and do that much anyway. After the meeting, Mueller consulted with Roger Hugill, the area fisheries manager, about the adequacy of the Barr proposal. Hugill found it inadequate.
Mueller and Hugill returned to the site about April 6, 1998 to see if any restoration had been done. No restoration had been done, and Mueller decided to recommend that a restoration order be issued. After the county attorney dismissed related criminal misdemeanor charges on April 28, 1998, Brant graded and seeded the area.
On May 3, 1999, the DNR issued its Findings of Fact and Order (Restoration Order). The Restoration Order's findings noted that DNR fisheries staff had made a site inspection on August 21, 1998, during which they had obtained temperature measurements.
The Restoration Order included the following allegations, among others: (a) because the ponds were excavated to a depth approximately 3 feet lower than the bottom of the stream, the streamflow is depleted and still would be depleted if buffer strips of less than 50 feet were installed on each side of the stream; (b) because of the open area of the ponds and removal of streamside vegetation, the temperature of the water in the stream was elevated and such higher water temperatures are harmful to trout and favor the presence of undesirable fish species; (c) the excavation of the ponds into and adjacent to Spring Creek has caused degradation of a coldwater fishery through warming and elimination of overhead shading and instream habitat; and (d) replacement of minimal amount of soil adjacent to the stream as proposed by Barr would not restore the fisheries habitat that had been lost, would not prevent subsurface seepage, and would not prevent thermal degradation of the trout stream.
The Restoration Order required the Brants to restore the stream by filling in the ponds and seeding the area; not to remove any existing willow or alder vegetation; to place a sediment barrier over the culvert; to complete the restoration by July 30, 1999; to pay a $100 field inspection fee; and to notify Mueller when the project was completed so a return inspection could be completed. The Restoration Order was issued without prior hearing pursuant to Minn. Stat. § 103G.251, subd. 2 (1998). The Brants duly demanded a hearing, also pursuant to Minn. Stat. § 103G.251, subd. 2. The Notice and Order for Hearing was issued August 30, 1999.
A contested-case hearing was held before an administrative law judge (ALJ) on November 18, 19, 22, 23, and 29, 1999. In addition, the parties and the ALJ made a site inspection on November 22, 1999.
Bruce Monson and Ray Wuolo of Barr Engineering testified on the Brants' behalf. Barr conducted surveys and data analyses in the summer of 1999 to determine the impact of the ponds on water temperatures and stream flow. Their studies showed that, while the water temperature increased in the ponds, the temperature declined as the stream flowed downstream and by a mile downstream from the ponds returned to about the same temperature as existed upstream of the ponds. As to water flow, they showed that because the ponds were now essentially level with the stream, and groundwater was flowing into the ponds and then into the stream, there was actually an increase in streamflow below the ponds. Moreover, as to the entire watershed, there was no net loss of water, except for a minimal amount due to evaporation from the pond surfaces, because all the water in the ponds that did not flow directly into the stream would flow as groundwater generally downstream until it entered the stream.
In addition to Mueller, Hugill, and Osterdyk, among those testifying for the state were Ian Chisolm, program supervisor for the DNR's Division of Fish and Wildlife Stream Habitat Program; Mark Ebbers, trout and salmon program coordinator for DNR Fisheries; Jason Moeckel, metro trout stream habitat specialist with DNR Fisheries; Jeanette Leet, supervisor of the technical analysis work group of the groundwater unit of DNR Waters; and DNR Fisheries technician Albert Linder. In general, they testified about watershed maintenance and fisheries management, discussing technical topics such as the relationship between water temperature and dissolved oxygen. They reviewed the documents relating to Spring Creek and pointedly disagreed with the idea that construction of the ponds had no impact on the stream habitat. They had varying degrees of first-hand experience with Spring Creek. Linder had extensive experience with Spring Creek. In 1992, Linder had surveyed the entire creek, including a detailed investigation of 300 feet in the precise area where the ponds had since been dug.
On December 30, 1999, the ALJ submitted his recommendation to the Commissioner of Natural Resources. The ALJ found that Brant's excavation changed and diminished the course, current, and cross-section of Spring Creek and that no DNR permit had been authorized for the work. The ALJ concluded that the current conditions did not meet the requirements for issuance of an "after-the-fact" permit. The ALJ recommended to the commissioner that the Restoration Order be affirmed and that enforcement of the order be stayed a reasonable period to allow the parties to negotiate a modified restoration plan.
In his accompanying memorandum, the ALJ explained:
It is clear in this case that the excavation by the Brants has dramatically altered Spring Creek. Where there was once a one to three foot wide stream running through deep grasses and brush, there is now a 480 by 100 or more foot wide pond with a narrow peninsula. The stream no longer exists where the pond exists. And while the temperature in the stream returns to upstream temperatures at some point downstream and there is minimal net water loss to the watershed, it cannot be concluded that these effects are minimal or that they are the only effects. The water from the ponds, heated, full of algae and sediment, low in oxygen, and containing different food supplies, flows directly into the stream and down to the areas that trout are found. If it had not been heated, it would have been even cooler downstream. Trout may have been able to survive farther upstream than they do now. Until the ponds filled up to the level of the ground water, they were lower than the stream and water was lost from the stream to the ponds. The legislature has given high priority to preserving the few trout streams that exist in Minnesota. The Brants' pond as it now exists is not consistent with that priority and not allowed by the rules implementing the legislative intent.
In an April 19, 2000 order, the commissioner affirmed the Restoration Order with several modifications. The commissioner ruled that instead of filling the ponds to 75 feet from the former stream channel as specified in the Restoration Order, the Brants may restore a distance of 50 feet provided that the culvert is also lowered to eliminate all ponding of water on its upstream side. The commissioner extended the completion date for ordered restoration work until September 15, 2000. On May 17, 2000, the Brants filed a petition for writ of certiorari, appealing the commissioner's April 19, 2000 order.
DECISION
We presume that agency decisions are correct and will reverse only upon "an error of law or when the findings are arbitrary and capricious or are unsupported by substantial evidence." Crookston Cattle Co. v. Minnesota Dep't of Natural Res., 300 N.W.2d 769, 777 (Minn. 1980) (citing Reserve Mining Co. v. Herbst, 256 N.W.2d 808, 824, 827 (Minn. 1977)); see also White v. Minnesota Dep't of Natural Res., 567 N.W.2d 724, 730 (Minn.App. 1997).
Spring Creek is a designated trout stream, Minn. R. 6264.0050, subp. 4 JJ (1999) (listed under the name "Spring Brook"), a public water under the regulatory authority of the DNR. Minn. Stat. § 103G.005, subd. 15(a)(4) (1998); see In re Application of Christenson, 417 N.W.2d 607, 609 (Minn. 1987) (noting legitimacy of DNR's regulatory authority of public waters). A person must have a public-waters work permit to "change or diminish the course, current, or cross section of public waters * * * by any means, including filling, excavating, or placing of materials in or on the beds of public waters." Minn. Stat. § 103G.245, subd. 1 (1998). The DNR may investigate activities being conducted without a permit that may affect public waters and issue findings and orders. Minn. Stat. § 103G.251, subds. 1, 2 (1998).
1. Brant argues that the commissioner's order is unsupported by substantial evidence. Substantial evidence means (1) such relevant evidence as a reasonable mind might accept as adequate to support a conclusion; (2) more than a scintilla of evidence; (3) more than some evidence; (4) more than any evidence; and (5) evidence considered in its entirety. White, 567 N.W.2d at 730 (quoting Cable Communications Bd. v. Nor-West Cable Communications P'ship, 356 N.W.2d 658, 668-69 (Minn. 1984) (quoting Reserve Mining Co., 256 N.W.2d at 825)).
The substantial evidence test requires a reviewing court to evaluate the evidence relied upon by the agency in view of the entire record as submitted. If an administrative agency engages in reasoned decisionmaking, the court will affirm, even though it may have reached a different conclusion had it been the factfinder. The court will intervene, however, where there is a "combination of danger signals which suggest the agency has not taken a `hard look' at the salient problems" and the decision lacks "articulated standards and reflective findings."
Id. As the state frames it, the relevant inquiry is limited to whether Brant changed the course, current, or cross- section of Spring Creek and, if so, whether he had a DNR permit to excavate the pond. Substantial evidence in the record readily supports the DNR's decision on both of these points.
First, there is no dispute that the excavation substantially changed the cross-section of the creek. The record is replete with documentary evidence and testimony that the excavation transformed 400 feet of a narrow creek into a large pond. In particular, DNR Fisheries technician Albert Linder, who surveyed that segment of the creek in 1992, provided a clear before-and-after account.
Second, there is likewise no dispute that Brant did not have a DNR permit. Brant admitted at the hearing that he did not have a DNR permit. He attempts to rely on the county grading-and-filling permit, but any reliance on the county permit is misplaced. The DNR is the only entity authorized to regulate activities affecting protected waters. In any event, the excavation went well beyond the terms of the grading-and-filling permit. The permit did not allow Brant to alter the creek. Nor did it allow excavation of the south pond. Brant does not dispute that Osterdyk of county zoning and Noyes of the county soil and water conservation district told him not to dig in the creek. Indeed, Brant told Irons not to dig in the creek. Clearly, Brant understood that the county permit did not authorize altering the creek.
Beyond the two issues of whether the creek was altered and whether Brant had the necessary permit, the ALJ's decision, as affirmed by the commissioner, goes on to consider whether Brant had demonstrated that restoration should not be required. The decision points out that in limited situations where a permit is not obtained prior to work in public waters, the DNR may allow the person to apply for an "after-the-fact" permit. Brant did not request an after- the-fact permit, but the decision applies permit-requirement analysis as nonetheless appropriate to Brant's argument.
The specific requirements for a permit to excavate public waters are set out in Minn. R. 6115.0200 6115.0201 (1999). The goal is to
limit the excavation of materials from the beds of protected waters in order to:
A. preserve the natural character of protected waters and their shorelands, in order to minimize encroachment, change, or damage to the environment, particularly the ecosystem of the waters;
B. regulate the nature, degree, and purpose of excavations so that excavations will be compatible with the capability of the waters to assimilate the excavation; and
C. control the deposition of materials excavated from protected waters and protect and preserve the waters and adjacent lands from sedimentation and other adverse physical and biological effects.
Minn. R. 6115.0200, subp. 1. The ALJ concluded that current conditions do not satisfy the goal of limited excavation in that they do not preserve the natural character of the environment, exceed the capability of the stream to assimilate the excavation, and fail to protect and preserve the stream from sedimentation and other adverse effects.
Excavation shall not be permitted
where the proposed excavation will be detrimental to significant fish and wildlife habitat, or protected vegetation and there are no feasible, practical, or ecologically acceptable means to mitigate the effects.
Minn. R. 6115.0200, subp. 3 C. The ALJ concluded that the current conditions constitute a non-permitted excavation in that they are detrimental to significant fish habitat, and feasible mitigation is available.
"The proposed project must represent the `minimal impact' solution to a specific need with respect to all other reasonable alternatives." Minn. R. 6115.0200, subp. 5c. The ALJ concluded that the current conditions do not represent a minimal-impact solution, are not limited to the minimum dimensions necessary for creating a wildlife pond, do not affect the biological character of the stream to the minimum degree feasible, and do not mitigate adverse affects on the stream.
Excavations in trout streams officially designated by the commissioner shall be allowed only if:
A. the amount, method, and location of the excavation will not result in increased water temperatures, cause excessive sedimentation in the stream, or destruction of fish habitat; and
B. there is no other feasible or practical alternative other than excavation.
Minn. R. 6115.0201, subp. 6. The ALJ concluded that the current conditions do not satisfy this rule applying specifically to excavation in designated trout streams, in that they result in increased water temperatures, cause excessive sedimentation in the stream, and destroy fish habitat. "[T]here are feasible alternatives to the current conditions, namely, some form of restoration."
The ALJ's conclusions about the current conditions, as affirmed by the commissioner, are supported by substantial evidence. Excavation of the ponds has not preserved the natural character of Spring Creek, is not the "miminal impact" solution to creating ponds, and restoration is a feasible alternative. The parties argue about the extent to which the current conditions adversely affect fish habitat. Brant's experts emphasize that there is minimal net water loss to the watershed and that, although there is some temperature increase at the ponds, the temperature decreases downstream to pre-pond levels. The ALJ's findings explicitly incorporated these facts. But the ALJ explained that "it cannot be concluded that these effects are minimal or that they are the only effects."
The ALJ's conclusions were based on extensive testimony provided by DNR Fisheries staff. Mueller, for one, testified that the excavation did not satisfy either the general standards for excavations in protected waters, found in rule 6115.0200, or the specific standards for excavations in designated trout streams, found in rule 6115.0201. By detailing in their decision the ways in which the current conditions do not satisfy the rules, the ALJ and the commissioner implicitly found Mueller's testimony credible and persuasive. "[D]eference should be shown by courts to the agencies' expertise and their special knowledge in the field of their technical training, education, and experience." Reserve Mining Co., 256 N.W.2d at 824. We conclude that substantial evidence supports the commissioner's decision that restoration is required.
Brant asserts that the DNR's "evidence was conceptual, illustrative, or anecdotal but it was definitely not substantial." Brant faults the DNR's experts for not performing any independent analysis or testing but instead merely commenting on data collected by Brant's experts. In fact, according to the May 3, 1999 Restoration Order, DNR Fisheries staff made a site inspection on August 21, 1998, during which they obtained temperature measurements. While they admittedly did not conduct the kind of extensive analyses and modeling done by Brant's experts, they did have first-hand knowledge of the conditions at the site. Mueller first inspected the property in September 1997, and both Mueller and Hugill returned to the site in April 1998. Furthermore, Linder had conducted an extensive inventory of the creek in 1992. DNR staff was familiar with the site such that testimony was not merely conceptual and anecdotal but rather based on direct experience.
2. Brant argues that the DNR violated Brant's due process rights by raising new biological and fisheries issues on appeal. Brant apparently believed that the issues to be dealt with at the contested case hearing were limited to thermal pollution and stream flow depletion and did not anticipate "fisheries issues such as dissolved oxygen, filamentous algae, and stream nutrients." A review of the May 3, 1999 Restoration Order reveals that, although the order emphasizes stream flow depletion and thermal pollution, it is in the context of a concern for fish habitat. Several findings in particular reference fisheries issues:
29) Water temperatures above 72 F can impair respiration, retard growth, lower disease resistance and interrupt the spawning cycle for cold water species like trout.
30) Higher water temperatures can also contribute to changes in the forage base and favor the presence of other, undesirable, fish species.
* * * *
37) The excavation of ponds into and adjacent to this trout system have caused degradation of a coldwater fishery, through warming and elimination of overhead shading and instream habitat.
38) Replacement of a minimal amount of soil adjacent to the stream, as proposed by Barr Engineering in a plan dated February 12, 1998, would not restore the fisheries habitat which has been lost, nor would it prevent thermal degradation of the trout stream.
While the restoration order did not explicitly reference dissolved oxygen, filamentous algae, and stream nutrients, it nevertheless indicated that fish habitat was at issue.
3. Brant argues that the ALJ erroneously placed the burden of proof on him. The DNR issued the May 3, 1999 Restoration Order without prior hearing pursuant to Minn. Stat. § 103G.251, subd 2. The person to whom the order is issued may file a demand for a hearing with the commissioner. Id. "[T]he hearing must be held in the same manner and with the same requirements as a hearing held under section 103G.311, subdivision 5." Id. Minn. Stat. § 103G.311, subd. 5 (1998), sets out the procedure for demanding a hearing on an order issuing or denying a permit. Minn. Stat. § 103G.315 (1998) governs the denial and issuance of permits and states:
In permit applications, the applicant has the burden of proving that the proposed project is reasonable, practical, and will adequately protect public safety and promote the public welfare.
Minn. Stat. § 103G.315, subd. 6 (1998). When challenging restoration orders under Minn. Stat. § 103G.251, subd. 2, the person requesting the hearing bears the burden of proof. The ALJ did not err.
4. Brant argues that the DNR exceeded its jurisdictional authority by requiring the Brants to restore lands beyond the ordinary high water mark of Spring Creek. Brant contends that he had the requisite county permit and that the DNR does not have authority to require restoration to 75 feet, 50 feet, 25 feet, or any other distance beyond the creek's ordinary high water mark. Brant cites no authority for this argument. In a 1986 case, this court rejected a similar argument that the DNR did not have authority to require landowners to fill in an already completed excavation on their private property. See In re Excavation of Erickson Lake (Beltrami County) by Lahman, 392 N.W.2d 636, 640 (Minn.App. 1986) (statute is very broad and allows commissioner to order person to take any action necessary to restore waters). The commissioner has the authority to order the restoration.