ABC Disposal Systems, Inc. v. DNR, 03-0147.
| Decision Date | 16 June 2004 |
| Docket Number | No. 03-0147.,03-0147. |
| Citation | 681 N.W.2d 596 |
| Parties | ABC DISPOSAL SYSTEMS, INC., Appellant, v. DEPARTMENT OF NATURAL RESOURCES, Appellee. |
| Court | Iowa Supreme Court |
Douglas H. Napier of Napier, Wolf & Napier, Fort Madison, for appellant.
Thomas J. Miller, Attorney General, and David R. Sheridan and David L. Dorff, Assistant Attorneys General, for appellee.
ABC Disposal Systems, Inc. (ABC) owns property in Hiawatha, Iowa, which it used for truck-to-trailer transfers of solid waste. Prior to investing in the equipment to perform truck-to-trailer transfers, ABC relied on advice from the Iowa Department of Natural Resources (DNR) that truck-to-trailer transfers did not require a sanitary disposal project permit. The DNR subsequently reversed its decision and ordered ABC to obtain a permit for its Hiawatha facility. It also levied a civil penalty against ABC in the sum of $5000 for ABC's failure to obtain a permit. On administrative appeal, the Iowa Environmental Protection Commission (Commission) affirmed the DNR's order that ABC was required to obtain a permit but reversed the Commission's order assessing the civil penalty. ABC sought judicial review of the Commission's decision in district court. The district court agreed with the Commission that ABC was required to obtain a permit for its Hiawatha facility. ABC appealed the district court's decision. Because we agree that ABC is required to obtain a permit for its Hiawatha facility, we affirm the district court.
ABC operates a solid waste collection business in Hiawatha, Iowa. In 1997, ABC began considering whether transfer trailers, which Brothers Industries (Brothers) manufactured, would be a good investment for ABC. Transfer trailers have expandable sides on the receiving end and a two-way walking floor. Brothers specially designed the transfer trailer for the direct truck-to-trailer transfer of materials such as solid waste. Using a ramp, the driver of the route-collection truck backs up into the transfer trailer and unloads its contents directly onto the trailer's floor. ABC's driver then hauls the transfer trailer to a landfill, where the waste is disposed. The advantage of transfer trailers is that it enables ABC to consolidate waste collected by two to three route-collection trucks in a single transfer trailer and transport large loads of solid waste to less expensive out-of-state disposal sites.
In the process of deciding whether to purchase transfer trailers, Ted Carter, a representative of ABC, met with a Brothers representative. As part of the sales pitch, the Brothers representative showed Carter a copy of a letter Brothers received from the DNR's solid waste section. The letter, which was dated November 20, 1996, stated, "a transfer station permit is not required in order for route-collection trucks to backup and unload into the rear of a transfer trailer with expandable side walls and a two-way walking floor."
In order to determine whether the above letter was legitimate and to ensure it was still the DNR's position that transfer trailers did not require a permit, Carter contacted the author of the above letter, who reaffirmed his earlier position. Additionally, Carter contacted another DNR employee who told him the same thing.
Ultimately, Carter purchased four transfer trailers and tractors to pull the trailers. ABC used its property located in Hiawatha to transfer the solid waste from the route-collection trucks to the transfer trailers. The Hiawatha facility had a concrete ramp, which the drivers of the route-collection trucks used to back their trucks up to the transfer trailers. Once the route-collection truck and the transfer trailer were in position, the transfer would take place. After the transfer was completed, ABC would haul most of the solid waste it collected to a private landfill in Milan, Illinois, where ABC received more favorable tipping rates as compared to the tipping rate it received at the local Iowa landfill. On occasion, ABC has also taken solid waste to Iowa landfills. The transfer trailers loaded with solid waste remain on the Hiawatha facility for less than twelve hours, excluding weekends or holidays.
On July 8, 1998, the DNR informed Brothers that it was reversing its prior opinion concerning the need of a permit for truck-to-trailer transfers of solid waste. The letter stated, "A transfer station permit is now required for truck-to-truck transfer of solid waste." The letter also listed other requirements for applicants to submit in order to obtain a permit. Over three months later, the DNR sent a similar letter to ABC informing ABC of the change in its requirements. The letter gave ABC until January 8, 1999, to comply with the requirements for obtaining a permit. ABC argued it was not a "facility" under the statute and resisted the DNR's request to obtain a permit. From July 1999 to January 2001, there was no communication between the DNR and ABC. The DNR explains the lapse in time was because it was in the process of reviewing 567 other cases.
On November 29, 2000, at the request of the DNR, the Attorney General's office issued an opinion concerning the requirements for operation of solid waste transfer stations in Iowa. The opinion concluded, "solid waste transfer stations are sanitary disposal projects within the meaning of Iowa Code section 455B.301(18), for which permits are required pursuant to Iowa Code section 455B.305."
On January 5, 2001, the DNR once again informed ABC that it must obtain a sanitary disposal permit for its Hiawatha facility. The DNR gave ABC a deadline of February 28, 2001, to obtain the permit. ABC continued to deny it needed a permit. At ABC's request, on April 4, 2001, an inspector from the DNR observed and videotaped a transfer of solid waste from a route-collection truck to a transfer trailer. The purpose of the DNR inspection was to gather information regarding the process that is involved with the transfer of solid waste from the route-collection trucks to the enclosed trailers. The inspector reported ABC uses two or three transfer trailers each day to haul approximately forty tons of solid waste to the landfill. Further, the inspector observed a small amount of solid waste that escaped during the transfer, which a worker immediately recovered and placed in the transfer trailer. The inspector also observed a small amount of liquid dripping from the floor of the transfer trailer onto the concrete ramp. The liquid was leachate. Leachate is "fluid that has percolated through solid waste and which contains contaminants consisting of dissolved or suspended materials, chemicals, or microbial waste products from the solid waste." Iowa Code § 455B.301(9) (2001). ABC informed the inspector an underground tank collects the leachate through a drain connected to the tank. The underground tank was on the property when ABC purchased the property. ABC had the drain installed by a third party, who is now deceased. No person at ABC knew anything about the size of the tank or the material from which it was constructed. ABC told the inspector it emptied the tank twice a week, depending on rainfall. After emptying the tank, ABC then would spread the leachate on construction debris, which absorbed more liquid than other waste materials. ABC would then put the construction debris in the transfer trailer with the other waste. After this inspection, the DNR maintained its previous position regarding ABC's need for a permit at the Hiawatha facility.
On July 24, 2001, the DNR issued an administrative order requiring ABC to submit, within fourteen days, all sanitary disposal project permit application documents or cease operation until ABC submits the requested documentation. The order also required ABC to pay a civil penalty of $5000. ABC appealed this order to the Commission pursuant to Iowa Code section 455B.308.
An administrative law judge from the Iowa Department of Inspections and Appeals conducted the hearing. Iowa Admin. Code r. 561-17.12(1). The administrative law judge entered her proposed decision affirming the portion of the order requiring ABC to obtain a permit for its Hiawatha facility but reversing the portion of the order that assessed the $5000 civil penalty. The Commission upheld the administrative law judge's proposed decision. The district court, on judicial review, affirmed the decision of the Commission. ABC appeals.
ABC raises several issues on appeal. They are: (1) whether the DNR has the statutory authority to require a sanitary disposal project permit for truck-to-trailer transfers; (2) whether ABC operates a transfer station; (3) whether the statutes governing the issuance of permits for sanitary disposal projects are unconstitutionally vague; and (4) whether the DNR is estopped from issuing an administrative order based on its past representations to ABC that no permit was required for its truck-to-trailer transfer operations.
In reviewing the decision of the district court, we must apply the standards set forth in Iowa Code section 17A.19(10) and determine whether our application of those standards produce the same results as reached by the district court. Auen v. Alcoholic Beverages Div., 679 N.W.2d 586, 589 (Iowa 2004). Section 17A.19(10) allows the district court to grant relief to a party seeking judicial review if the court determines that substantial rights of the person seeking judicial relief has been prejudiced by the agency action because the agency action meets any one of the several enumerated provisions in paragraphs a through n. Iowa Code § 17A.19(10). Neither party claims that if we find that one of the enumerated provisions of section 17A.19(10) has been met, that the agency's action does not affect the substantial rights of ABC. We will set out the applicable provisions of section 17A.19(10) as they relate to each issue.
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