Opinion
No. 55,951
Opinion filed February 18, 1984.
SYLLABUS BY THE COURT
ADMINISTRATIVE LAW — Rules and Regulations — Salt Water Spill from Injection Well — Report Requirement of Regulation Construed. K.A.R. 28-16-27 is construed and held not to require the owner of a salt water injection well to report an accidental salt water spill to the Kansas Department of Health and Environment.
Appeal from Rice district court, WILLIAM J. LAUGHLIN, judge. Opinion filed February 18, 1984. Reversed with directions.
Thomas E. Malone, of Redmond, Redmond, O'Brien and Nazar, of Wichita, argued the cause and was on the brief for appellant.
Emily E. Cameron, of Kansas Department of Health and Environment, argued the cause and L. Patricia Casey, of KDHE, was with her on the brief for appellee.
The opinion of the court was delivered by
Defendant Department of Health and Environment (KDHE) assessed a $250.00 civil penalty against plaintiff Malone Oil Company, a partnership, for failure to report a salt water spill. Plaintiff appealed to the district court and the administrative order was sustained. Plaintiff now seeks appellate review.
Malone Oil Company is a family partnership which was organized in 1971 for the purpose of drilling oil wells on family owned realty located in Rice County, Kansas. A well, known as Keesling # 1 and drilled in 1974, was not commercially productive. On November 21, 1975, authorization for waterflood operations was obtained from the Kansas Corporation Commission (KCC) pursuant to K.S.A. 55-133 (repealed L. 1982, ch. 228, § 26). In 1976, in apparent accordance with the permit, the well known as Keesling # 1 was converted to a salt water injection well (in actuality fresh water was initially used by virtue of the lack of available salt water). The KCC water flood authorization was amended in 1979 to permit conversion of another not commercially productive oil well to a salt water injection well. Fresh water continued to be used in both injection wells. In 1981, by virtue of some additional drilling, salt water became available and was utilized for both injection wells.
In late March, 1982, a crack was observed by Francis Malone in a PVC pipe involved in the salt water injection well system. The pipe was promptly repaired. It was difficult to ascertain how much salt water had escaped from the pipe, but it was estimated to be about 30 barrels. A farm pond was located on the Malone property. Its exact location in relation to the cracked pipe cannot be ascertained from the record, but apparently there was no indication at that time salt water had contaminated the pond water. There were no livestock in the pasture where the pond was located until some were placed there on April 25, 1982, under a lease. On April 27, 1982, it was noted the cattle were in distress and were not drinking from the farm pond. When fresh water was provided, the cattle drank thirstily. On April 28, 1982, Mr. Younkin, owner of the cattle, telephoned KDHE for a salinity check on the pond water. The testing was done the following day and a high chloride level was indicated.
Upon being advised of the test findings by KDHE, plaintiff hauled the water out of the pond, this operation being completed on May 9, 1982. The cattle were provided with fresh water during the clean-up operation. On May 11, 1982, KDHE issued an administrative order finding plaintiff had violated K.A.R. 28-16-27 by not reporting to it the salt water spill and assessed a $250.00 civil penalty pursuant to K.S.A. 65-170d( a) and ( b). Plaintiff then requested an administrative hearing before the Secretary of Health and Environment pursuant to K.S.A. 65-170d( c). The hearing was held on July 9, 1982, and the civil penalty was affirmed on July 30, 1982. Plaintiff perfected an appeal therefrom to the district court as provided by K.S.A. 65-170d( d). The district court sustained the KDHE and plaintiff appeals therefrom.
A number of issues are raised. We shall first consider whether K.A.R. 28-16-27 imposed a duty upon plaintiff oil company to report the salt water spill to KDHE. If the regulation did not impose such a duty, all other issues would be rendered moot.
In order to place this issue in context, some preliminary discussion is warranted. Challenges to the validity of administrative regulations are usually predicated upon contentions the agency exceeded its statutory authority in promulgating the regulation in question. The issue, in such cases, is whether the statutory authority asserted by the agency as the basis for its regulation is broad enough to authorize the regulation. As this court stated in Willcott v. Murphy, 204 Kan. 640, 465 P.2d 959 (1970):
"The power of an administrative agency to adopt rules and regulations is administrative in nature, not legislative, and to be valid administrative regulations must be within the authority conferred. An administrative regulation which goes beyond or conflicts with legislative authorization is void." 204 Kan. 640, Syl. ¶ 1.
These fundamental principles were recently stated in Pork Motel, Corp. v. Kansas Dept. of Health Environment, 234 Kan. 374, 673 P.2d 1126 (1983), as follows:
"Administrative agencies are creatures of statute and their power is dependent upon authorizing statutes, therefore any exercise of authority claimed by the agency must come from within the statutes. There is no general or common law power that can be exercised by an administrative agency.
"Rules or regulations of an administrative agency, to be valid, must be within the statutory authority conferred upon the agency. Those rules or regulations that go beyond the authority authorized, which violate the statute, or are inconsistent with the statutory power of the agency have been found void. Administrative rules and regulations to be valid must be appropriate, reasonable and not inconsistent with the law." 234 Kan. at 378-79.
In the case before us a markedly different determination must be made. We must decide whether the regulation (K.A.R. 28-16-27), although based upon very broad statutory authority (K.S.A. 65-171d), is, itself, sufficiently broad to require the oil company to report the salt water spill to KDHE. In other words, the question is not whether the regulation has exceeded its statutory authority, but whether the regulation, as promulgated, applies to the plaintiff's activities herein.
K.S.A. 65-171d is a part of a long series of contiguous statutes (K.S.A. 65-161 through -171w) dealing with water supply and sewage. The purpose of this legislation was stated in Pork Motel, Corp. v. Kansas Dept. of Health Environment, 234 Kan. 374, as follows:
"The legislature has by statute charged the secretary of KDHE with specific duties to protect the health and environment of the citizens of this state. Two areas in which the legislature has stated the public policy of the state and granted authority to the secretary of KDHE to carry out that policy are: (1) protecting our water supply and controlling discharge of sewage into the water supply (K.S.A. 65-161 et seq.), and (2) achieving and maintaining levels of air quality which protect human health and safety (K.S.A. 65-3001 et seq.). To carry out the legislative policy, the secretary of KDHE has been granted the authority to issue permits regarding water supply and the discharging of sewage into the water supply, and allowed to set conditions to protect and maintain certain levels of air quality.
"The secretary has authority to issue a water and sewage permit when, in the secretary's opinion, the general interest of the public health would be subserved thereby or the discharge of such sewage would not detract from the quality of the water of this state for the beneficial use for domestic or public water supply, agriculture needs, industrial needs, or other beneficial use. The secretary shall issue a permit, stipulate in the permit the conditions upon which such discharge shall be permitted and require such treatment of sewage as he determines necessary to protect beneficial uses of the waters of the state. K.S.A. 65-165." 234 Kan. at 379.
KDHE has authority to issue two kinds of permits under K.S.A. 65-161 et seq. — for discharge of sewage (K.S.A. 65-165), and for operators of public water systems (K.S.A. 65-163). K.S.A. 65-164 provides:
" No person, company, corporation, institution or municipality shall place or permit to be placed or discharge or permit to flow into any of the waters of the state any sewage, except as hereinafter provided. This act shall not prevent the discharge of sewage from any public sewer system owned and maintained by a municipality or sewerage company, if such sewer system was in operation and was discharging sewage into the waters of the state on the twentieth day of March, 1907; but this exception shall not permit the discharge of sewage from any sewer system that shall have been extended subsequent to the aforesaid date, nor shall it permit the discharge of any sewage which, upon investigation by the secretary of health and environment as hereinafter provided, shall be found to be polluting the waters of the state in a manner prejudicial to the health of the inhabitants thereof.
" For the purposes of this act, sewage is hereby defined as any substance that contains any of the waste products or excrementitious or other discharges from the bodies of human beings or animals, or chemical or other wastes from domestic, manufacturing or other forms of industry." (Emphasis supplied.)
To discharge sewage, including industrial waste, a permit must be obtained pursuant to K.S.A. 65-165. The statute provides, in part:
"[T]he secretary of health and environment shall issue a permit for the extension of a sewer system and/or for the discharge of sewage and shall stipulate in the permit the conditions on which such discharge will be permitted and shall require such treatment of the sewage as he shall determine necessary to protect beneficial uses of the waters of the state in accordance with the statutes and regulations defining the quality of the water affected by said discharge and may require treatment of the sewage in accordance with regulations predicated upon technologically based effluent limitations." (Emphasis supplied.)
With this background, we turn to the specific issue before us.
The regulation in question is K.A.R. 28-16-27, which provides:
" The owner or person responsible for the discharge of sewage or other materials detrimental to the quality of waters of the state, under conditions other than provided for by a valid permit issued by the secretary of the state board of health, shall report such discharge to the state department of health, environmental health services.
"When sewage treatment facilities or portions thereof are programmed for bypassing for cause, which results in reduced treatment efficiency below acceptable levels, the owner or his representative shall notify and receive approval from the state department of health at least seven (7) days prior to such discharge.
" Emergency or accidental discharge of sewage or other materials detrimental to the quality of waters of the state shall be immediately reported to the state department of health by the owner of the treatment plant or his representative. In the event the water pollution-causing material is in transit or in storage within the state, it shall be the responsibility of the owner, the carrier, or person responsible for storage, to immediately notify the state department of health that the pollutant has gained admittance or there is the potential the pollutant will gain admittance to waters of the state. (Authorized by K.S.A. 65-164, 65-169, 65-171a, 65-171f, K.S.A. 1968 Supp. 65-165, 65-166, 65-167, 65-171d, 65-171h; effective Jan. 1, 1969.)" (Emphasis supplied.)
It shall be noted K.S.A. 65-171d is one of the statutes upon which K.A.R. 28-16-27 is predicated. As far as the duty to notify of the salt water spill herein is concerned, K.S.A. 65-171d is conceded by KDHE to be the one statute upon which the regulation relies for authorization. K.S.A. 65-171d provides in relevant part:
"For the purpose of preventing surface and subsurface water pollution and soil pollution detrimental to public health or to the plant, animal and aquatic life of the state, and to protect beneficial uses of the waters of the state and to require the treatment of sewage predicated upon technologically based effluent limitations, the secretary of health and environment shall make such rules and regulations, including registration of potential sources of pollution, as may in its judgment be necessary to protect the waters of the state from pollution by oil, gas, salt water injection wells or underground storage reservoirs; to control the disposal, discharge or escape of sewage as defined in K.S.A. 65-164, by or from municipalities, corporations, companies, institutions, state agencies, federal agencies, or individuals and any plants, works, or facilities owned and/or operated by them; and to establish water quality standards for the waters of the state to protect their beneficial uses. . . . The storage or disposal of salt water, oil or refuse in surface ponds shall be prohibited unless a permit for such storage or disposal shall first be obtained from the secretary of health and environment, and such permit shall be considered as granted unless denied within ten (10) days. The secretary of health and environment is authorized to deny or revoke a permit for such storage or disposal in any case where he finds such storage is causing or likely to cause pollution: Provided, however, That where a fresh water reservoir or farm pond is privately owned and where complete ownership of land bordering the reservoir is under common private ownership, such fresh water reservoir or farm pond shall be exempt from water quality standards except as it relates to water discharge or seepage from the reservoir to waters of the state, either surface or groundwater, or as it relates to the public health of persons using the reservoir or pond or waters therefrom." (Emphasis supplied.)
Thus, storage or disposal of salt water in surface ponds is prohibited without a KDHE permit unless specifically exempted from the statute. Obviously, the accidental spill from the cracked pipe in the salt water injection well system cannot be categorized as storage or disposal of salt water in a surface pond and, hence, an activity requiring a permit. It would be ridiculous to require a permit for an unforeseen accidental happening. Indeed it would be difficult to draft conditions of a permit concerned solely with unplanned and unforeseen possible events. Carried to ludicrous extremes, a truck hauling oil field brine which was involved in an accident and overturned in a farm pond could be considered to be the disposing of salt water in a farm pond and hence, in the absence of a permit, could subject the truck owner to a KDHE fine. We conclude this section of K.S.A. 65-171d is inapplicable herein although KDHE argues otherwise.
Before leaving the area of disposal of salt water, it should be noted K.S.A. 55-1003 requires authorization by the KCC with the approval of KDHE before an oil field brine disposal system may be operated. K.S.A. 55-1003 is not one of the statutes on which K.A.R. 28-16-27 relies for authority.
Let us look specifically at K.A.R. 28-16-27. It is necessary to analyze the regulation section by section. The first two paragraphs provide as quoted on pp. 6-7:
"The owner or person responsible for the discharge of sewage or other materials detrimental to the quality of waters of the state, under conditions other than provided for by a valid permit issued by the secretary of the state board of health, shall report such discharge to the state department of health, environmental health services.
"When sewage treatment facilities or portions thereof are programmed for bypassing for cause, which results in reduced treatment efficiency below acceptable levels, the owner or his representative shall notify and receive approval from the state department of health at least seven (7) days prior to such discharge."
Included in the authority for K.A.R. 28-16-27 are K.S.A. 28-16-27 are K.S.A. 65-164, -165, -166, -167 and -169 — which prohibit discharge of sewage without a permit, set up the procedure for acquiring a permit, and assess penalties for noncompliance of up to $25,000.00 for each offense and up to an additional $25,000.00 each day the discharge of sewage without a permit or in violation of the terms of the permit is maintained.
We believe the first two paragraphs of K.A.R. 28-16-27 relate wholly to the disposal of sewage as specified in K.S.A. 65-164 through -169 and require a permit holder who is discharging sewage or other materials in a manner other than specified in the permit to report immediately such nonconforming discharge to KDHE. Further, a sewage treatment facility must receive prior approval before bypass which results in reduced treatment efficiency. Under the regulation, then, one required to have a sewage disposal permit must report to KDHE when sewage is discharged under conditions other than specified in the permit. By this regulation, KDHE is not required to rely on ferreting out those disposing of sewage under conditions violative of their permits. Rather the person violating the conditions of his permit is required to report the violation.
The next sentence of K.A.R. 28-16-27 provides:
"Emergency or accidental discharge of sewage or other materials detrimental to the quality of waters of the state shall be immediately reported to the state department of health by the owner of the treatment plant or his representative." (Emphasis supplied.)
By this provision only owners or representatives of treatment plants are required to report emergency or accidental discharge of sewage or other materials to the KDHE. If discharge, as used in the regulation, encompasses all situations where sewage or other materials escape, as urged by KDHE, then this provision is indeed strange. We believe, when read in harmony with the preceding portions of the regulation, the provision is logical. Holders of sewage disposal permits must report any deviation from the method of sewage disposal specified in their permits. This assumes an intentional deviation. An emergency or accidental discharge of sewage by a treatment facility must also be reported.
We conclude none of the previously discussed provisions of K.A.R. 28-16-27 require that KDHE be notified of a salt water spill arising from a cracked pipe in a salt water injection well system.
KDHE next argues the activities of the plaintiff were subject to the final provision of K.A.R. 28-16-27 which provides:
"In the event the water pollution-causing material is in transit or in storage within the state, it shall be the responsibility of the owner, the carrier, or person responsible for storage, to immediately notify the state department of health that the pollutant has gained admittance or there is the potential the pollutant will gain admittance to waters of the state." (Emphasis supplied.)
This portion of the regulation is the balance of the paragraph which deals with reporting emergency or accidental discharge of sewage from a treatment facility. We do not believe it extends the duty to report to classes of activities wholly unrelated to the discharge of sewage. We believe proper interpretation requires consideration of these provisions in the context of the entire regulation. The phrase " the water pollution-causing material" is significant. The inclusion of the article the before water pollution-causing material must refer back to sewage or other materials used previously in the regulation. The purpose of this requirement then becomes clear. The provisions of the regulation preceding this provision are involved with the actual discharge of sewage in a sewage disposal program. The final provision extends the duty to report potential water pollution arising from the transportation or storage of sewage or other materials preparatory to their discharge in accordance with the sewage discharge permit.
We conclude the accidental escape of salt water from a pipe which was a part of a salt water injection well system is an activity not encompassed by K.A.R. 28-16-27. Hence, the regulation imposed no duty upon plaintiff to report the salt water spill to KDHE. This being so, a civil penalty was not properly assessable against plaintiff for violation of K.A.R. 28-16-27. In making this determination, we do not find that K.S.A. 65-171d does not authorize KDHE to promulgate a valid regulation which would require the reporting of a salt water spill under circumstances such as occurred herein. Rather, we are holding K.A.R. 28-16-27, the regulation relied upon by KDHE, does not apply to this particular salt water spill. In other words, we are holding the KDHE regulation relied upon did not require a reporting of the salt water spill herein but do not hold KDHE could not require a reporting for occurrences such as this upon promulgation of an appropriate regulation.
The judgment is reversed with directions to enter judgment for the plaintiff.