Jacko v. State, Pebble Ltd. Partnership

353 P.3d 337, 2015 Alas. LEXIS 75, 2015 WL 4381086
Alaska Supreme Court·Decided July 17, 2015·No. 7019 S-15516·Published·Cited by 4 cases

Opinion

OPINION

BOLGER, Justice.

I. INTRODUCTION

Lake and Peninsula Borough voters passed an initiative prohibiting large-scale mining activities that have a "significant adverse impact" on anadromous waters within the Borough. Pebble Limited Partnership and the State of Alaska pursued separate suits against the Borough, later consolidated, claiming that the initiative was preempted by state law. Two of the initiative sponsors intervened to support the initiative. The superior court granted summary judgment in favor of Pebble and the State and enjoined the Borough from enforcing the initiative. The initiative sponsors appeal, arguing that the dispute is unripe and that the superior court's preemption analysis was erroneous. But because at least the State has articulated a concrete harm stemming from the initiative's mere enactment, the case is ripe for adjudication. And because the initiative purports to give the Borough veto power over mining projects on state lands within its borders, it seriously impedes the implementation of the Alaska Land Act, which grants the Department of Natural Resources "charge of all matters affecting exploration, development, and mining" of state resources. We therefore affirm.

II. FACTS AND PROCEEDINGS

The Lake and Peninsula Borough (the Borough) is a home rule borough in southwest Alaska bordering the world's largest wild sockeye salmon fishery. Within the Borough, on state-owned land, lies what may be the world's largest discovery of undeveloped copper ore. Pebble Limited Partnership (Pebble) holds the mineral rights to this copper and has spent over a decade exploring the feasibility of mining. However, because extracting the copper would likely generate significant amounts of waste, there is concern that the Pebble project may have detrimental environmental effects that could impair the long-term sustainability of the Borough's salmon industry. 1

In March 2011 George Jacko, Jackie Hob-son, Sr., and other Borough residents proposed the "Save Our Salmon" Initiative # 2 (the SOS Initiative), a borough initiative prohibiting the Borough Planning Commission from issuing a permit whenever a proposed resource extraction activity (a) "could result in excavation, placement of fill, grading, removal and disturbance of the topsoil of more than 640 acres of land," and (b) "will have a Significant Adverse Impact on existing ana-dromous waters." The SOS Initiative defined "Significant Adverse Impact" as

a use, or an activity associated with the use, which proximately contributes to a material change or alteration in the natural *339 or social characteristics of a part of the state's coastal area and in which:
a) the use, or activity associated with it, would have a net adverse effect on the quality of the resources of the coastal area;
b) the use, or activity associated with it, would limit the range of alternative uses of the resources of the coastal area; or
c) the use would, of itself, constitute a tolerable change or alteration of the resources within the coastal area but which, cumulatively, would have an adverse effect.

The SOS Initiative also replaced the requirement that an applicant obtain "[alll applicable state and federal permits ... before a development permit will be issued by the Borough" with the recommendation that an "applicant should obtain its development permit from the Borough prior to obtaining applicable state and federal permits." Additionally, the SOS Initiative authorized the Borough Planning Commission to indefinitely consider applications for large-scale resource extraction permits.

Before the 2011 election, Pebble sued the Borough for declaratory and injunctive relief, contending that the SOS Initiative exceeded the Borough's "power to legislate on matters governing land use permit requirements" and was thus "unenforceable as a matter of law." Pebble asked the superior court to order the Borough not to certify the SOS Initiative and to remove it from the ballot. George Jacko and Jackie Hobson, Sr. (the sponsors) moved to intervene, and the superior court granted their motion. Pebble, the Borough, and the sponsors moved for summary judgment, but the court abstained from ruling on the certification issue and deferred its evaluation of the SOS Initiative's validity until after the election. 2

In October 2011 Borough voters approved the SOS Initiative, enacting it as Borough law. Pebble then amended its complaint, alleging that the enacted initiative was constitutionally preempted by article VIII of the Alaska Constitution and statutorily preempted by the Alaska Land Act. 3 Pebble further claimed that the SOS Initiative improperly appropriated state assets, violated equal protection, and was void for vagueness. Finally, Pebble alleged that the initiative violated the Borough's charter, claiming that the Borough could not amend its municipal code in the absence of a valid comprehensive plan. 4

The State separately sued the Borough for declaratory and injunctive relief. Like Pebble, the State alleged that the SOS Initiative was preempted by the Alaska Constitution and by the Alaska Land Act. The State further claimed that it had "immunity from the operation of the law enacted by the SOS initiative to the extent that it purports to prohibit development of State land and State-owned minerals." The superior court consolidated the State's case with Pebble's previously filed case.

Each of the parties-Pebble, the State, the sponsors, and the Borough-moved for summary judgment on the merits of Pebble's and the State's claims. The sponsors and the Borough also argued that the case was not ripe because Pebble had not yet applied for a Borough permit.

The superior court granted summary judgment in favor of Pebble and the State. Turning first to ripeness, the court found that there was an "actual controversy" because the likelihood of permit denial would have a "dissuasive effect on potential investors" and place a "real burden" on Pebble. Likewise, the court found that the ability of "local government entities ... [to] impede natural resource development via permitting ordinances" would have a "profound[ ] [elf-fect[ ]" on "the regulatory climate in Alaska" and harm the State's royalty and tax revenues, regardless of whether local entities ultimately chose to grant or deny local development permits.

On the merits, the superior court concluded that the SOS Initiative was impliedly preempted by state statute. The court noted that the state legislature "comprehensively *340 conferred authority over all aspects of mining in Alaska to [the Department of Natural Resources]" (DNR). And the court found that the SOS Initiative purported to grant the Borough Planning Commission "co-equal permitting authority" with DNR-authority that was "substantially irreconcilable" with the legislature's intent that DNR be the sole gatekeeper of mining permits. Accordingly, the court concluded that the SOS Initiative was impliedly preempted by state statute and enjoined the Borough from enforcing it.

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Jacko v. State, Pebble Ltd. Partnership, 353 P.3d 337, 2015 Alas. LEXIS 75, 2015 WL 4381086 (Ala. 2015).

353 P.3d 337 (Jacko v. State, Pebble Ltd. Partnership) — published by Counsel Stack Legal Research, free access to 12M+ legal documents.

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