Clean Water Action Council v. Wisconsin Department of Natural Resources

2014 WI App 61, 848 N.W.2d 336, 354 Wis. 2d 286, 2014 WL 1673130, 2014 Wisc. App. LEXIS 349
Court of Appeals of Wisconsin·Decided April 29, 2014·No. No. 2013AP2112·Published·Cited by 3 cases

Opinion

STARK, J.

¶ 1. Clean Water Action Council of Northeast Wisconsin (CWAC) appeals an order dismissing its petition for judicial review of the Wisconsin Department of Natural Resources' (DNR) decision to reissue a Wisconsin Pollution Discharge Elimination System (WPDES) permit to Appleton Coated LLC. Relying on Sewerage Commission v. DNR, 102 Wis. 2d 613, 307 N.W.2d 189 (1981), the circuit court concluded CWAC failed to exhaust its administrative remedies because it petitioned for judicial review under Wis. Stat. § 227.521 without first obtaining a contested case hearing under Wis. Stat. § 283.63. We agree with the circuit court that Sewerage Commission is controlling and requires a contested case hearing under § 283.63 as a [291] prerequisite to judicial review of the DNR's decision to issue a WPDES permit. We therefore affirm the order dismissing CWAC's petition.

BACKGROUND

¶ 2. The United States Congress enacted the Federal Water Pollution Control Act Amendments of 1972 (the Clean Water Act) to "restore and maintain the chemical, physical, and biological integrity of the Nation's waters." 33 U.S.C. § 1251(a). "To effectuate that objective, the Clean Water Act generally prohibits the discharge of any pollutant into navigable waters except when done pursuant to a National Pollution Discharge Elimination System (NPDES) permit." Andersen v. DNR, 2011 WI 19, ¶ 33, 332 Wis. 2d 41, 796 N.W.2d 1 (citing 33 U.S.C. § 1311(a)). The United States Environmental Protection Agency (EPA) has primary authority to issue NPDES permits, but it may delegate that authority to a state when certain conditions are met. 33 U.S.C. § 1342(a)(1), (b). The EPA approved Wisconsin's WPDES permitting program on February 4, 1974. Andersen, 332 Wis. 2d 41, ¶ 37. The WPDES program is administered by the DNR and governed by Wis. Stat. ch. 283. Wis. Stat. §§ 283.001(2), 283.01(3).

¶ 3. On October 1, 2012, the DNR reissued a WPDES permit to Appleton Coated authorizing it to discharge treated wastewater from its paper production facility into the lower Fox River. CWAC filed a petition for judicial review of the DNR's decision to reissue the permit, under Wis. Stat. § 227.52, arguing the permit violated several state statutes and administrative rules. Appleton Coated moved to dismiss CWAC's petition, arguing: (1) CWAC failed to exhaust its administrative remedies because it did not obtain a contested case [292] hearing under Wis. Stat. § 283.63 before seeking judicial review; and (2) the portions of the permit that CWAC asserted were illegal did not constitute final agency decisions. The circuit court agreed with Appleton Coated's first argument and dismissed CWAC's petition. CWAC now appeals.

DISCUSSION

¶ 4. "[W]here a statute sets forth a procedure for review of administrative action and court review of the administrative decision, such remedy is exclusive and must be employed before other remedies are used." Nodell Inv. Corp. v. City of Glendale, 78 Wis. 2d 416, 422, 254 N.W.2d 310 (1977). Pursuant to this principle, courts generally deny judicial relief until the parties have exhausted their administrative remedies. Id. at 424. The requirement that parties exhaust their administrative remedies " 'is a doctrine of judicial restraint, justified by good policy reasons.' It permits the administrative agency to apply its own expertise to the matter, promotes judicial efficiency, and may provide the court with greater clarification of the issues in the event the matter is not resolved before the agency." St. Croix Valley Home Builders Ass'n, Inc. v. Township of Oak Grove, 2010 WI App 96, ¶ 11, 327 Wis. 2d 510, 787 N.W.2d 454 (quoting State ex rel. Mentek v. Schwarz, 2001 WI 32, ¶ 8, 242 Wis. 2d 94, 624 N.W.2d 150).

¶ 5. Whether to apply the doctrine of exhaustion is committed to the circuit court's discretion. Id., ¶ 10 & n.5. Thus, we will uphold the circuit court's decision if it examined the relevant facts, applied a proper standard of law, and used a demonstrably rational [293] process to reach a reasonable conclusion. Id., ¶ 10. We independently review any questions of law underlying the court's discretionary decision. Monicken v. Monicken, 226 Wis. 2d 119, 125, 593 N.W.2d 509 (Ct. App. 1999).

¶ 6. The circuit court concluded CWAC failed to exhaust its administrative remedies because it proceeded directly to judicial review under Wis. Stat. § 227.52. without first obtaining a contested case hearing under Wis. Stat. § 283.63. CWAC argues the court erred because § 283.63 is not the exclusive review procedure for WPDES permitting decisions. In the alternative, CWAC argues that, even if it was required to proceed under § 283.63, the circuit court should have applied an exception to the exhaustion doctrine. We reject both of these arguments for the reasons explained below.

I. Failure to exhaust administrative remedies

¶ 7. To determine whether the circuit court properly exercised its discretion when it concluded CWAC failed to exhaust its administrative remedies, we must interpret the relevant statutes — Wis. Stat. §§ 227.52 and 283.63. Statutory interpretation presents a question of law that we review independently. McNeil v. Hansen, 2007 WI 56, ¶ 7, 300 Wis. 2d 358, 731 N.W.2d 273.

¶ 8. Wisconsin Stat. § 227.52 provides a general right to judicial review of administrative decisions "except as otherwise provided by law."2 The circuit court [294] concluded Wis. Stat. § 286.63 provides an exception to § 227.52 review for WPDES permitting decisions. Section 286.63(1) states:

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Clean Water Action Council v. Wisconsin Department of Natural Resources, 2014 WI App 61, 848 N.W.2d 336, 354 Wis. 2d 286, 2014 WL 1673130, 2014 Wisc. App. LEXIS 349 (Wis. Ct. App. 2014).

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