Inland Foundry Co., Inc. v. Spokane County Air Pollution Control Authority, 14798-3-III

• Decision Date: 02 May 1996
• Docket Number: No. 14798-3-III,14798-3-III
• Citation: 82 Wn.App. 67,915 P.2d 537
• Court: Washington Court of Appeals
• Parties: INLAND FOUNDRY COMPANY, INC., a Washington corporation, Appellant, v. SPOKANE COUNTY AIR POLLUTION CONTROL AUTHORITY, a municipal corporation, Respondent.

Page 67

82 Wn.App. 67

915 P.2d 537

INLAND FOUNDRY COMPANY, INC., a Washington corporation, Appellant, v. SPOKANE COUNTY AIR POLLUTION CONTROL AUTHORITY, a municipal corporation, Respondent.

No. 14798-3-III.

Court of Appeals of Washington,

Division 3,

Panel Four.

May 2, 1996.

Reconsideration Denied Dec. 4, 1996.

[915 P.2d 538] Appeal from Superior Court, Spokane County; Richard Schroeder, Judge. No. 94-2-02195-2.

Eric K. Nayes, Spokane, for Appellant.

Thomas F. Kingen, Perkins Coie, Spokane, for Respondent.

THOMPSON, Judge.

Inland Foundry Company, Inc. operates a ferrous foundry in Spokane County. In 1992, the Spokane County Air Pollution Control Authority (SCAPCA) billed Inland an annual facility fee, an inspection fee and emission fees. The fees were assessed in accordance with SCAPCA regulations which classified foundries as air contaminant sources and established a method for calculating assessments. When Inland refused to pay the fees, SCAPCA issued an order of payment. Inland challenged the order and the regulations in an appeal to the Pollution Control Hearings Board (PCHB). In summary judgment proceedings, the PCHB upheld the regulations and order. On appeal to superior court, the PCHB's decision was affirmed. We reverse and remand to the PCHB for further proceedings.

STANDARD OF REVIEW

Both Inland and SCAPCA moved for summary judgment in the PCHB's proceedings. Accordingly, this court engages in the same inquiry as the PCHB. In doing so, review is confined to the administrative record. A summary judgment is appropriate only when there is no genuine issue as to any material facts and the moving party is entitled to judgment as a matter of law. Marincovich v. Tarabochia, 114 Wash.2d 271, 274, 787 P.2d 562 (1990).

Judicial review of rules adopted by an activated air pollution control authority such as SCAPCA is governed by Part V of RCW Chapter 34.05, the Administrative Procedure Act (APA). RCW 70.94.141(1). Therefore, although SCAPCA is a municipal corporation, ¹ its rules are reviewed under the APA in the same manner as rules of a state agency. When reviewing a rule under the APA, ² the court shall declare the rule invalid only if it finds that it violates constitutional provisions, exceeds the statutory authority of the agency, was adopted without compliance with statutory rule-making procedures, or it is arbitrary and capricious. RCW 34.05.570(2)(c).

CLASSIFICATION REGULATION AND ENABLING STATUTE

SCAPCA regulated Inland as a member of the class of air contaminant sources it described as "casting facilities and foundries, ferrous and nonferrous." The classification was established in SCAPCA Regulation I, Article IV, Section 4.01, which states:

Under the authority of 70.94.151 RCW, the classes of air contaminant sources listed in Exhibit "R" below are regulated by the Authority. An air contaminant source whether publicly or privately owned shall register with the Authority unless a written exemption is issued by the Authority. An air contaminant source established after the adoption of this Section shall register prior to commencing operations. Registration information shall be updated annually thereafter.

The board of any activated air pollution control authority has the power to adopt, amend and repeal its own rules and regulations to implement Washington's Clean Air Act, so long as they are consistent with the Act and in accordance with chapter 42.30 RCW. ³ RCW 70.94.141(1).

Specific authority to classify air contaminant sources is found in former RCW 70.94.151. ⁴ It states in relevant part:

(1) The board of any activated authority ... may classify air contaminant sources, by ordinance, resolution, rule or regulation, which in its judgment may cause or contribute to air pollution, according to levels and types of emissions and other characteristics which cause or contribute to air pollution, and may require registration or reporting or both for any such class or classes. Classifications made pursuant to this section may be for application to the area of jurisdiction of such authority, or the state as a whole or to any designated area within the jurisdiction, and shall be made with special reference to effects on health, economic and social factors, and physical effects on property.

(Emphasis added.)

Inland concedes that SCAPCA has the authority under RCW 70.94.151 to classify air contaminant sources, but asserts that SCAPCA went beyond its authority by classifying sources without regard to levels and types of emissions and without special reference to effects on health, economic and social factors, and physical effects on property. According to Inland, SCAPCA's regulation simply lists air contaminant sources by type of business activity.

SCAPCA contends, and the PCHB concluded, that SCAPCA's regulation classifying air contaminant sources was "properly promulgated" under RCW 70.94.141 and RCW 70.94.151(1). However, there is nothing in the administrative record from which it can be determined whether SCAPCA considered the statutory criteria when it adopted the challenged regulation and we cannot ascertain whether it did from the language of the regulation itself. Although SCAPCA contends it relied on federal and state law and documents in enacting the regulation, there is nothing in the administrative record to so indicate. ⁵ Meaningful review cannot be completed in the absence of an adequate record.

The sole source of factual information before the PCHB was the affidavit of Kelle Vigeland, an environmental engineer working for SCAPCA. Her affidavit is limited to information regarding her inspection of Inland, the factors and methods used to calculate Inland's emissions, and the basis for Inland's fee assessments. Although the affidavit supports SCAPCA's contention that its classification system, as applied to Inland, took into account the level and types of its emissions, it does not address Inland's broader challenge.

A court examines the actions of an agency to ensure that they were undertaken after proper consideration of appropriate facts. Although the court need not, and generally should not, substitute its judgment for that agency, it must make certain that judgment was in fact exercised properly and fairly. Cf. Neah Bay Chamber of Commerce v. Department of Fisheries, 119 Wash.2d 464, 475, 832 P.2d 1310 (1992).

Based on the record before the PCHB, SCAPCA was not entitled to judgment as a matter of law as to the challenged regulation classifying air contaminant sources.

FEE ASSESSMENT REGULATION AND ENABLING STATUTE

We turn next to Inland's challenge to SCAPCA's fee assessment regulation. According to Inland, SCAPCA cannot require it to pay a fee until it is properly classified as an air contaminant source, and SCAPCA is only authorized to assess a single fee, not three fees.

SCAPCA Regulation I, Article X, Section 10.06 provides for fees for the initial registration of an air contaminant source and annual fees thereafter. These are referred to as "facility fees." The regulation also provides for fees for the inspection of emissions based on the number of emission points, as well as fees based on annual emissions. According to the affidavit of Ms. Vigeland, fees are segregated into components so that small air contaminant sources do not pay for the cost of administering programs for larger, more complex sources.

Pursuant to Regulation I, Article X, Section 10.06, Inland was assessed a $50 facility fee based on its registration as...