Container Life Cycle Mgmt., LLC v. Wis. Dep't of Natural Res.

• Decision Date: 23 June 2022
• Docket Number: 2019AP1007
• Citation: 402 Wis.2d 337,975 N.W.2d 621,2022 WI 45
• Parties: CONTAINER LIFE CYCLE MANAGEMENT, LLC, Petitioner-Appellant-Petitioner, v. WISCONSIN DEPARTMENT OF NATURAL RESOURCES, Respondent-Respondent.
• Court: Wisconsin Supreme Court

402 Wis.2d 337

975 N.W.2d 621

2022 WI 45

CONTAINER LIFE CYCLE MANAGEMENT, LLC, Petitioner-Appellant-Petitioner,

v.WISCONSIN DEPARTMENT OF NATURAL RESOURCES, Respondent-Respondent.

No. 2019AP1007

Supreme Court of Wisconsin.

Oral Argument: April 6, 2022

Opinion Filed: June 23, 2022

For the petitioner-appellant-petitioner, there were briefs filed by David M. Lucey, Linda E. Benfield, Peter A. Tomasi, Anne-Louise T. Mittal, and Foley & Lardner LLP, Milwaukee. There was an oral argument by David M. Lucey.

For the respondent-respondent, there was a brief filed by Gabe Johnson-Karp, assistant attorney general, with whom on the brief was Joshua L. Kaul, attorney general. There was an oral argument by Gabe Johnson-Karp.

An amicus curiae brief was filed by Scott E. Rosenow and WMC Litigation Center, Madison, for Wisconsin Manufacturers & Commerce, Inc.

ANN WALSH BRADLEY, J., delivered the majority opinion of the Court, in which ROGGENSACK, DALLET, HAGEDORN, and KAROFSKY, JJ., joined. REBECCA GRASSL BRADLEY, J., filed a dissenting opinion, in which ZIEGLER, C.J., joined.

ANN WALSH BRADLEY, J.

¶1 The petitioner, Container Life Cycle Management, LLC (CLCM), seeks review of a per curiam decision of the court of appeals affirming the circuit court's dismissal of its petition for judicial review of two letters issued by the Department of Natural Resources (DNR) in December of 2018.¹ The court of appeals determined that the letters at issue were not final agency decisions subject to judicial review.

¶2 CLCM argues that the December 14 letter² adversely affects its substantial interests and is subject to judicial review regardless of whether it constitutes a "final" decision of DNR. Further, CLCM contends that even if there is a "finality" requirement for judicial review pursuant to Wis. Stat. § 227.52 (2019-20),³ the December 14 letter is sufficiently final to warrant judicial review. In response, DNR asserts that the December 14 letter does not affect CLCM's substantial interests and that CLCM's petition for judicial review is an untimely attempt to seek review of an earlier letter.

¶3 For the reasons set forth below, we conclude that the December 14 letter does not adversely affect CLCM's substantial interests. As a result, the letter is not subject to judicial review and the circuit court properly dismissed CLCM's petition.

¶4 Accordingly, we affirm the decision of the court of appeals.

I

¶5 CLCM is engaged in the business of refurbishing used chemical containers. At its facility in St. Francis, it receives and cleans industrial containers such as steel and plastic drums. The St. Francis facility is a source of air emissions subject to DNR's regulation.

¶6 Understanding the factual background of this case requires a short foray into the governing law and the terminology it creates. DNR regulates CLCM through the issuance of air permits under the federal Clean Air Act,⁴ Wisconsin's analogous air pollution statutes,⁵ and related DNR regulations⁶ regarding emissions of air contaminants from stationary sources.⁷

¶7 The applicable statutes recognize two main categories of stationary sources, major sources and minor sources. A major source is one that is capable of emitting a greater amount of contaminants than the law permits, and a minor source is a stationary source that is not a major source.⁸ As relevant here, regulations also recognize a "synthetic minor source," which is a source that has the capability to emit more contaminants than permitted by law, but accepts permit conditions that keep its emissions below the major source level.⁹

¶8 Generally, a construction permit is required to construct a new emissions source or modify an existing source.¹⁰ In areas of the country with relatively good air quality, the permitting framework centers on the prevention of significant deterioration of air quality, referred to as "PSD."¹¹ Major sources are subject to PSD requirements, which means that specifications in a construction permit must be based on maximum pollution control achievable with the best available pollution control technology, or "BACT."¹²

¶9 In 2017, both DNR and the United States Environmental Protection Agency notified CLCM of a violation of an air permit it had been issued in 2014. The source of the violation was odors and air emissions from the St. Francis facility. Seeking to remedy the violation, in February 2018, CLCM sought a permit to install a regenerative thermal oxidizer as a means of controlling odors and emissions. DNR responded that it needed additional information.

¶10 On June 7, 2018, CLCM submitted a revised construction permit application. In addition to the regenerative thermal oxidizer, the revised application sought the installation of a new emissions source, removal of existing equipment, and the revision of existing permit emission limits. CLCM requested a "commence construction waiver" for the regenerative thermal oxidizer and new emissions source that would allow construction to begin before the permit was issued.

¶11 DNR responded to the revised application with a letter dated June 26, 2018. In the June letter, DNR denied the commence construction waiver on the basis that "the facility is a PSD major source" and stated that it "may not grant a waiver" for such a source. The June letter also stated that previous projects undertaken at CLCM's facility should have been subject to PSD permitting and that the facility required "an after-the-fact PSD permit to address ... emissions not previously disclosed."

Additionally, the June letter stated that the revised application was incomplete and requested that CLCM address several issues to finish the application.

¶12 Among the several issues, the June letter stated:

Because the facility is a major PSD source of [volatile organic compounds (VOCs)], it is important to allocate the total VOC emissions to each emission unit to understand, for each unit, the applicability of permitting under ch. NR 405, Wis. Adm. Code. Please provide maximum theoretical and potential VOC emission calculations for each significant unit at the facility ....

In addition, for the units subject to major-source review, "the facility will be expected to provide additional information in support of a BACT determination, as applicable."

¶13 The June letter also observed that the "revised construction permit application indicates the facility would like to be a synthetic minor for VOC emissions." DNR expressed concern "that the nature of the operations at the facility do not allow for practical enforceability" of the proposed limitation that would make CLCM's facility a synthetic minor source. Accordingly, DNR asked CLCM to "[p]lease explain how the facility can demonstrate compliance with this limitation."

¶14 Finally, the June letter indicated that it was "not a complete review of the ... construction permit application request or the operation permit application submitted at the same time." However, it contained a notice of appeal rights and applicable deadlines, stating: "If you believe that you have a right to challenge this construction waiver decision, you should know that Wisconsin statutes establish time periods within which requests to review Department decisions must be filed." As relevant here, the letter set forth: "For judicial review of a decision pursuant to §§ 227.52 and 227.53, Wis. Stats., you have 30 days after the decision is mailed, or otherwise served by the Department, to file your petition with the appropriate circuit court and serve the petition on the Department ...."

¶15 CLCM neither petitioned for judicial review of the June letter, nor did it provide all of the additional information DNR requested. Rather, CLCM submitted revised calculations and technical memoranda in an attempt to demonstrate that its facility was not a major source.

¶16 DNR responded to CLCM's revised calculations with a letter dated December 14, 2018. According to the December 14 letter, DNR still considered CLCM's application to be incomplete. It also explicitly stated that it disagreed with CLCM's assertions that the facility was not a major source and that it was not subject to an after-the-fact PSD permit. DNR "once more" requested that CLCM submit BACT analyses.

¶17 Additionally, the December 14 letter raised the issue of CLCM's request to be considered a synthetic minor source. It set forth:

[T]he department has determined that such a permitting approach is not approvable in an after-the-fact PSD situation. In accordance with long-standing US EPA and department policy, DNR cannot issue a construction permit for existing equipment for which a facility failed to obtain a PSD permit without placing BACT or BACT-equivalent controls on the equipment in question.

¶18 The December 14 letter then listed emissions units subject to BACT review, stating that DNR "requests again that CLCM provide[ ] additional information for the units identified ... as well as any other modified or new emissions units that are sources of VOC emissions, sufficient for the department to make a BACT determination for each unit." It additionally reiterated that information requested in the June letter remained outstanding. DNR specifically stated that it "again requests that CLCM provide additional information to explain how it proposes to demonstrate compliance with its proposed VOC cap" as would be necessary for CLCM to be classified as a synthetic minor source.

¶19 As the June letter did, the December 14 letter advised that it was "not a complete review" of either the construction permit application or operation permit application and that "[a]dditional information or revisions of the application materials may be needed as the review proceeds." The December 14 letter did not contain any notice of appeal rights.

¶20 After CLCM followed up with a letter, DNR responded with another letter of its own on December 26, 2018. In the December 26 letter, DNR took the position that "a joint meeting between the department, CLCM,...