Gilliam County v. Department of Environmental Quality

• Citation: 114 Or.App. 369,837 P.2d 965
• Parties: GILLIAM COUNTY and Oregon Waste Systems, Inc., Petitioners, v. DEPARTMENT OF ENVIRONMENTAL QUALITY, Respondent. COLUMBIA RESOURCE COMPANY L.P., Petitioner, v. ENVIRONMENTAL QUALITY COMMISSION, Respondent. CA A68441 (Control) & CA A68455.
• Decision Date: 22 December 1992
• Court: Oregon Court of Appeals

Page 965

837 P.2d 965

114 Or.App. 369

GILLIAM COUNTY and Oregon Waste Systems, Inc., Petitioners, v. DEPARTMENT OF ENVIRONMENTAL QUALITY, Respondent.

COLUMBIA RESOURCE COMPANY L.P., Petitioner, v. ENVIRONMENTAL QUALITY COMMISSION, Respondent.

CA A68441 (Control) & CA A68455.

Court of Appeals of Oregon.

Argued and Submitted Sept. 6, 1991.

Decided July 22, 1992.

Reconsideration Denied Nov. 4, 1992.

Review Allowed Dec. 22, 1992.

J. Laurence Cable, Portland, argued the cause for petitioners Gilliam County, Oregon, and Oregon Waste Systems, Inc. With him on the brief were James E. Benedict, Donald A. Haagensen, Hill, Huston, Cable, Ferris & Haagensen, Timothy V. Ramis, Jeff Bachrach, and O'Donnell, Ramis, Crew & Corrigan, Portland.

John A. DiLorenzo, Jr., Portland, argued the cause for petitioner Columbia Resource Co., L.P. With him on the brief was O'Connell, Goyak & DiLorenzo, Portland.

Robert M. Atkinson, Asst. Atty. Gen., Salem, argued the cause for respondents. With him on the brief were Dave Frohnmayer, Atty. Gen., and Virginia L. Linder, Sol. Gen., Salem.

Before BUTTLER, P.J., and ROSSMAN and DE MUNIZ, JJ.

DE MUNIZ, Judge.

Petitioner Oregon Waste Systems, Inc. (OWS), owns and operates a regional solid waste disposal facility known as the Columbia Ridge Recycling Center and Landfill. It is located southwest of Arlington in Gilliam County. OWS disposes of waste generated in Oregon and also waste generated outside of Oregon. The operation provides direct and indirect benefits to petitioner Gilliam County as a result of employment in the county and the payment of local fees and taxes.

Petitioner Columbia Resource Company, L.P. (CRC), has a 20-year contract with Clark County, Washington, under which it disposes of solid waste originating there. CRC uses the Finley Buttes Landfill in Morrow County as its disposal site. The operator of the Finley Buttes Landfill passes through to CRC the costs incurred for disposal, including charges made by respondent Department of Environmental Quality (DEQ).

Petitioners challenge the constitutionality of two DEQ rules that the Environmental Quality Commission (EQC) adopted in December, 1990, OAR 340-61-115(1); OAR 340-61-120(6), and the enabling statutes that established the legal standards and procedures for adoption of those rules. ORS 459.297; ORS 459.298. The portions of the rules that petitioners challenge impose a surcharge for in-state disposal of garbage generated out-of-state. ¹

In 1989, the legislature enacted Oregon Laws 1989, chapter 833, an amalgamation of several bills dealing with waste reduction. Section 155, codified as ORS 459.297, provides that every person who disposes of solid waste that was generated out-of-state must pay a surcharge to help meet the cost to the state of administering the solid waste program. ² Section 156, codified as ORS 459.298, enables EQC to establish the amount of the surcharge. ³ The rules impose on the disposal site a surcharge of $2.25 per ton for out-of-state waste that the site receives. The surcharge imposed at the disposal site for waste generated within Oregon is capped at $.50 per ton. Former ORS 459.294(5). ⁴

The Oregon Supreme Court has explained that, before we can reach constitutional issues under ORS 183.400, ⁵ we must first determine: (1) whether the agency had the general authority to make that kind of rule; (2) whether the agency followed the procedures prescribed by statute or regulation; and (3) whether the substance of the rule departed from the legal standard expressed or implied in the enabling legislation or contravened some other applicable statute. Planned Parenthood Assn. v. Dept. of Human Res., 297 Or. 562, 565, 687 P.2d 785 (1984).

"These steps are designed to assure that the challenged action, particularly an action challenged for arguably violating constitutional rights, in fact was authorized by the state's or local government's politically accountable policy makers. Only if the action was clearly so authorized is there any reason to decide whether the state or local government has adopted a policy that the constitution forbids." 297 Or. at 565, 687 P.2d 785.

Petitioners do not contend that the agency did not have the general authority to make rules imposing surcharges on solid waste. They also make no meritorious arguments that the substance of the rules deviated from the legal standard provided in the statute ⁶ or that they contravened some other applicable statute. ⁷ Their procedural argument is that ORS 459.298 requires the agency to follow a process that violates the Oregon Constitution and that the statute in its entirety is therefore invalid, so no rules could be made under it. They argue in the alternative that, if the procedures are permissible, then the rules are invalid, because the agency did not follow those procedures. If the rules were made by a valid procedure, they argue, they are nonetheless invalid, because they impermissibly discriminate against interstate commerce in violation of the United States Constitution.

We turn first to the state law issues. Planned Parenthood Assn. v. Dept. of Human Res., supra. Under ORS 459.298, the amount of the surcharge is subject to approval by the Joint Committee on Ways and Means (Committee) during legislative sessions or by the Emergency Board during the interim. OWS argues that the grant of authority to the Emergency Board violates the state constitution. CRC agrees and argues that subjecting the rules to approval by the Committee is also unconstitutional. Both petitioners assert that the unconstitutional provisions render the statute unconstitutional and, therefore, that the rules promulgated under it are invalid. If the approval requirements are valid, they argue, then the rules are invalid, because EQC did not seek to obtain final approval from either authority.

Respondents concede, and we agree, that ORS 459.298 is unconstitutional to the extent that it subjects the surcharge determination to Emergency Board approval, because the Board has only the powers granted to it in Article III, section 3, of the Oregon Constitution. Art. IV, §§ 1, 25. Those powers do not include the power to veto EQC's surcharge rule. ⁸ Respondents argue, however, that the language requiring Emergency Board approval is severable from ORS 459.298, that the statute is workable without that provision and that EQC followed the correct procedure by not obtaining final approval of the Board.

The starting point for deciding that issue is ORS 174.040, which states the legislative preference for severability:

"It shall be considered that it is the legislative intent, in the enactment of any statute, that if any part of the statute is held unconstitutional, the remaining parts shall remain in force unless:

"(1) The statute provides otherwise;

"(2) The remaining parts are so essentially and inseparably connected with and dependent upon the unconstitutional part that it is apparent that the remaining parts would not have been enacted without the unconstitutional part; or

"(3) The remaining parts, standing alone, are incomplete and incapable of being executed in accordance with the legislative intent."

Petitioners contend that Emergency Board approval is essential to the remaining parts, because without it the statute cannot be executed in accordance with legislative intent.

The bills that comprised HB 3515, which became Oregon Laws 1989, chapter 833, had been referred first to subject matter committees to consider their substance and then to the Joint Committee on Ways and Means to consider their fiscal impacts. The Joint Committee on Ways and Means, the first committee to consider HB 3515 as a whole, inserted the Emergency Board approval requirement without providing a detailed explanation for it. Petitioners rely on the history of other sections of the bill that also included Emergency Board oversight. On the basis of that history, they argue that "the overriding philosophy * * * was to maintain strict E-Board control over fees of various agencies" and that the legislature would not have enacted the statute without that control.

The history cited by petitioners shows that members of the Committee were informed that, legally, the Emergency Board could review and comment on the surcharges, but that it did not have approval authority. During consideration of the State Fire Marshall's authority to establish a fee schedule relating to hazardous wastes, ⁹ a legislative committee staff member, Acuff, commented:

"Mr. Chairman, I believe that legislative counsel will tell you that the Emergency Board does not have the approval authority * * * that it is a review and comment only."

The response of the chair, Representative Hanlon, was to instruct staff to include control "to the extent authorized by law."

The history also demonstrates that inclusion of Emergency Board review was intended to permit the exertion of political, even if not legal, pressure:

"Acuff: "Well, I think you're accomplishing your objective * * *. I think you're accomplishing the objective that you want now in limiting the dollars that you have in your first four decisions. You're forcing the fee structure as it is and they will come back to you and prove that [to] you either to the E-Board or to the Assembly.

"Rep. Jones: Except that * * * if [the Fire Marshall does not prove the need to the Emergency Board to increase fees] they go ahead and do it anyway.

"Acuff: I doubt that the Fire Marshall would go ahead and do it anyway.

"Rep. Hanlon: So do I. We will be breaking for a quick lunch at 12:30 * * * half an hour or so. Up to the lounge and get some cornflakes. I would like to see the amendment. I'm not sure because I wasn't listening to the whole thing, but I think Representative Jones and I agree the amendment should be made to the fullest extent possible to control the imposition of those fees. And that means that the E-Board * * * whoever it is that's approving it in the...