Wal*Mart Stores, Inc., In re

• Decision Date: 29 August 1997
• Docket Number: No. 95-398,95-398
• Citation: 702 A.2d 397,167 Vt. 75
• Court: Vermont Supreme Court
• Parties: Page 397 702 A.2d 397 167 Vt. 75 In re WAL*MART STORES, INC. and The St. Albans Group. Supreme Court of Vermont

Page 397

702 A.2d 397

167 Vt. 75

In re WAL*MART STORES, INC. and The St. Albans Group.

No. 95-398.

Supreme Court of Vermont.

Aug. 29, 1997.

Peter M. Collins and Mark G. Hall of Paul, Frank & Collins, Inc., Burlington, for appellants Wal*Mart Stores, Inc. and The St. Albans Group.

David A. Barra of Hill, Unsworth, Barra, Bowles & Gannon, Essex Junction, for appellant Town of St. Albans.

Joseph F. Cahill, Jr. and Timothy J. Ryan of Brown, Cahill, Gawne & Miller, St. Albans, for amicus curiae Franklin County Industrial Development Corp.

Thomas F. Heilmann of Heilmann, Ekman & Associates, Inc., Burlington, for amicus curiae Vermont Association of Realtors TM, Inc.

William E. Roper of Neuse, Smith, Roper & Venman, P.C., Middlebury, Christopher M. Kilian and Mark Naud, Law Clerk (On the Brief), Montpelier, for amicus curiae Vermont Natural Resources Council.

Francis X. Murray, South Burlington, for amicus curiae Franklin/Grand Isle County Citizens for Downtown Preservation.

Jeffrey L. Amestoy, Attorney General, and Ronald A. Shems and John H. Hasen, Assistant Attorneys General, Montpelier, for amicus curiae State of Vermont.

Before ALLEN, C.J., and GIBSON, DOOLEY, MORSE and JOHNSON, JJ.

GIBSON, Justice.

Wal*Mart Stores, Inc. and The St. Albans Group (Wal*Mart) and the Town of St. Albans (Town) appeal an order of the Environmental Board denying Wal*Mart's application, pursuant to 10 V.S.A. chapter 151 (Act 250), for a permit to build a retail store in the Town. Wal*Mart and the Town claim that the Board erred in: (1) considering perceived adverse impacts on municipal tax revenues arising from Wal*Mart's competition in the regional market, a factor they contend is irrelevant and too speculative to be considered; (2) requiring Wal*Mart to produce a study of secondary-growth impacts to satisfy several Act 250 criteria; (3) interpreting Criterion 9(A) (impact of growth) to apply to commercial growth, not simply population growth; (4) finding that the proposed store would be "scattered development" under Criterion 9(H); (5) requiring, under Criterion 5 (traffic), a lower level of congestion than is required by the Agency of Transportation; and (6) concluding that the proposed store would unduly burden local municipalities' ability to provide municipal and educational services under various criteria. We affirm the Board's denial of a permit under Criterion 9(A), and do not reach its ruling under Criterion 9(H).

In September 1993, Wal*Mart filed an application under Act 250 for a permit to build a retail store in the Town. The District # 6 Commission found that the application satisfied all criteria listed in 10 V.S.A. § 6086(a), and granted a permit for the project. Franklin/Grand Isle County Citizens For Downtown Preservation (Citizens), the Vermont Natural Resources Council (VNRC) and Commons Associates appealed the district commission's decision to the Board. Citizens appealed the decision with respect to Criteria 5 (traffic), 6 (impact on education), 7 (municipal services), 9(A) (impact of growth), and 9(H) (costs of scattered development). VNRC appealed the decision with respect to Criteria 9(A) and 9(H). ¹

After de novo review of the appealed criteria under 10 V.S.A. § 6089(a), the Board denied Wal*Mart's permit application on December 23, 1994 under Criteria 9(A) and 9(H). The Board also concluded that Wal*Mart had failed to satisfy Criteria 6 (impact on education) and 7 (impact on municipal services), although a permit may not be denied on these criteria alone. See 10 V.S.A. § 6087(b). In response, Wal*Mart moved to alter the decision. The Board denied the motion and issued a final order, with minor changes, on June 27, 1995.

The Board authorized reconsideration of Wal*Mart's application under 10 V.S.A. § 6087(c), but ordered that, if Wal*Mart chose to seek reconsideration, it must provide a credible study of secondary-growth impacts and propose a permit condition to alleviate the burden caused by the project for any municipality in which the public costs outweigh the public benefits. ² The present appeal followed.

We give deference to the Environmental Board's interpretations of Act 250 and its own rules, and to the Board's specialized knowledge in the environmental field. Secretary v. Earth Constr., Inc., 165 Vt. 160, 163, 676 A.2d 769, 772 (1996). Absent compelling indications of error, we will sustain its interpretations on appeal. Re Chittenden Recycling Servs., 162 Vt. 84, 90, 643 A.2d 1204, 1208 (1994). Our deferential level of review, however, "does not equate with mere judicial passivity in determining the propriety of Board 'interpretations' of its own rules." In re Vitale, 151 Vt. 580, 583, 563 A.2d 613, 615 (1989). Rather, as with all legislative schemes, we are guided by the intent of the Legislature, as evidenced by the statutes themselves. Id.

The Legislature requires that "[t]he findings of the board with respect to questions of fact, if supported by substantial evidence on the record as a whole, shall be conclusive." 10 V.S.A. § 6089(c); see In re Killington, Ltd., 159 Vt. 206, 210, 616 A.2d 241, 244 (1992). Thus, we will affirm the Board's findings if based on evidence properly before the Board that is relevant and that a reasonable person might accept as adequate to support a conclusion. In re Denio, 158 Vt. 230, 236, 608 A.2d 1166, 1170 (1992). We will affirm the Board's conclusions of law if "they are rationally derived from a correct interpretation of the law and findings of fact based on substantial evidence." In re BHL Corp., 161 Vt. 487, 490, 641 A.2d 771, 773 (1994).

I.

Wal*Mart and the Town argue that the Board's findings and conclusions on the impacts of market competition should be overturned because such impacts are irrelevant to Act 250 review. Amici VNRC and Citizens contend that Wal*Mart failed to object to the relevance of marketing and secondary-growth studies before the Board, and therefore, is precluded from raising this issue before us. See 10 V.S.A. § 6089(c) (objection that has not been urged before Board may not be considered by Supreme Court).

Although the parties did not specifically address the admissibility or use of either a marketing or a secondary-growth study, it is clear that Wal*Mart objected to the relevance of economic impacts early in the process. In a prehearing memorandum, VNRC indicated that, at the hearing on the merits, it intended to address the extent to which fiscal tax impacts resulting from the proposed project's competition with existing retail stores would violate Criterion 9(H). In response, Wal*Mart argued that Act 250 does not authorize the Board to consider anything more than the additional costs to the community for public services and facilities caused by the project. Wal*Mart specifically stated, "There is no indication that Criterion 9(H) is intended to provide a scale for measuring the overall economic impact of a retail store on private businesses located in neighboring towns." Wal*Mart raised the issue again in its hearing memorandum and in its proposed findings of fact.

The Board acknowledged that the parties had questioned the relevance of the project's effect on existing retail stores and on the tax base of the various localities. It ruled against Wal*Mart's objections and concluded that the project's impacts on retail sales and tax revenues were relevant to Criteria 6, 7, 9(A) and 9(H). The question is therefore properly before the Court.

The Board's conclusion that the project's impact on market competition is a relevant factor under Criterion 9(A) finds support in the plain language of the statute, which requires the Board to consider the "financial capacity" of the town and the region to accommodate growth. 10 V.S.A. § 6086(a)(9)(A); see Green Tree Credit Corp. v. Kenyon, 163 Vt. 631, 632, 660 A.2d 296, 298 (1995) (mem.) (if statute's meaning is plain on face, Court will enforce statute according to its terms). Further, Criterion 9(A) requires consideration of the cost of "education, highway access and maintenance, sewage disposal, water supply, police and fire services and other factors relating to the public health, safety and welfare." A municipality's ability to pay for these services depends on its tax base, that is, the appraised value of property in the municipality's grand list. To the extent that a project's impact on existing retail stores negatively affects appraised property values, such impact is a factor that relates to the public health, safety, and welfare. Cf. People v. Kohrig, 113 Ill.2d 384, 101 Ill.Dec. 650, 658, 498 N.E.2d 1158, 1166 (1986) (" '[I]n the interest of general welfare, the police power may be exercised to protect citizens and their businesses in financial and economic matters, [and] it may be exercised to protect the government itself against potential financial loss.' ") (quoting Sherman-Reynolds, Inc. v. Mahin, 47 Ill.2d 323, 265 N.E.2d 640, 642 (1970)). There is no compelling indication of error in the Board's interpretation of Criterion 9(A).

The same analysis applies to Criteria 6 and 7, which require findings pertaining to "the ability of a municipality to provide educational services" and "the ability of the local governments to provide municipal or governmental services." Just as the public health, safety, and welfare depend on the tax base so do educational and other public services. The arguments of Wal*Mart and amicus Vermont Association of Realtors TM, Inc. to the contrary are unavailing.

Wal*Mart contends, however, that the Board should not have considered the project's impact on market competition because projections of such impacts are speculative and unreliable. In support of this contention, Wal*Mart relies on several studies of the accuracy of economic impact analysis that do not appear in the record. Moreover, Wal*Mart does not indicate that this issue was ever raised before the Board. In any event, such an argument goes not to admissibility, but...