Mountain Coal Company, LLC v. Water Quality Control Division of the Colorado Department of Public Health and Environment

2025 COA 65

• Court: Colorado Court of Appeals
• Decided: July 10, 2025
• Docket: 24CA0907
• Status: Published

Opinion

The summaries of the Colorado Court of Appeals published opinions constitute no part of the opinion of the division but have been prepared by the division for the convenience of the reader. The summaries may not be cited or relied upon as they are not the official language of the division. Any discrepancy between the language in the summary and in the opinion should be resolved in favor of the language in the opinion.

SUMMARY July 10, 2025

2025COA65

No. 24CA0907, Mountain Coal Company, LLC v. Water Quality Control Division of the Colorado Department of Public Health and Environment — Public Health and Environment — Colorado Water Quality Control Act — Colorado Discharge Permit System — Stormwater Discharge Permits — Overburden Contamination — Uncontaminated Stormwater Runoff

A division of the court of appeals holds, as a matter of first

impression, that, under Department of Public Health and

Environment Regulation 61, 5 Code Colo. Regs. 1002-61,

stormwater discharge from a point source associated with industrial

activity is not subject to the discharge permit requirement of the

Colorado Water Quality Control Act unless it is contaminated by

contact with overburden. COLORADO COURT OF APPEALS 2025COA65

Court of Appeals No. 24CA0907 Gunnison County District Court No. 22CV30061 Honorable J. Steven Patrick, Judge

Mountain Coal Company, LLC,

Plaintiff-Appellant,

v.

Water Quality Control Division of the Colorado Department of Public Health and Environment, Center for Biological Diversity, WildEarth Guardians, High Country Conservation Advocates, and Sierra Club,

Defendants-Appellees.

JUDGMENT AFFIRMED IN PART AND REVERSED IN PART, AND CASE REMANDED WITH DIRECTIONS

Division I Opinion by JUDGE J. JONES Kuhn and Moultrie, JJ., concur

Announced July 10, 2025

Clark Hill PLC, Gabe Racz, Justine C. Beckstrom, Boulder, Colorado, for Plaintiff-Appellant

Philip J. Weiser, Attorney General, Michael C. Landis, First Assistant Attorney General, Carrie Noteboom, Assistant Deputy Attorney General, Rachel Kassler, Assistant Attorney General, Denver, Colorado, for Defendant-Appellee Water Quality Control Division of the Colorado Department of Public Health and Environment

Edward B. Zukoski, Allison N. Henderson, Crested Butte, Colorado, for Defendants-Appellees Center for Biological Diversity, WildEarth Guardians, High Country Conservation Advocates, and Sierra Club ¶1 Mountain Coal Company, LLC (the Company), appeals the

district court’s judgment affirming the decision of the Colorado

Department of Public Health and Environment’s Water Quality

Control Division (the Division) to issue a renewal permit regulating

certain discharges of stormwater at the Company’s mine. The

Division regulated the discharges because it determined that the

stormwater contacts “overburden” (a term discussed below) at the

mine.

¶2 We conclude that, under the applicable statutes and

regulations, stormwater runoff’s contact with overburden alone isn’t

sufficient; the Division must determine that such contact

contaminates the runoff before it may require a permit regulating

the stormwater discharge. Because the Division failed to do so

before it renewed the Company’s stormwater discharge permit, and

because uncontested evidence in the record shows that the

stormwater at issue isn’t contaminated by contact with overburden,

we reverse the district court’s judgment as to the discharge sources

to which this challenge by the Company applies and remand the

case with directions to order the Division to remove the challenged

stormwater discharge restrictions from the Company’s renewal

1 permit as to those sources. We affirm the judgment, however, as to

the one discharge source the Company challenges based solely on

the purported impropriety of the administrative proceedings, as that

challenge fails.

I. Regulatory Framework

¶3 Congress enacted the Clean Water Act, 33 U.S.C.

§§ 1251-1376, “to restore and maintain the chemical, physical, and

biological integrity of the Nation’s waters.” § 1251(a). In

furtherance of this goal, the Act establishes a National Pollutant

Discharge Elimination System (NPDES) permitting program to

regulate water pollution emanating from a “point source.” 33

U.S.C. § 1342; see 33 U.S.C. § 1362(14) (defining “point source” as

“any discernible, confined and discrete conveyance, including but

not limited to any pipe, ditch, channel, tunnel, conduit, well,

discrete fissure, [or] container . . . from which pollutants are or may

be discharged”). “Where the source of a pollutant is a point source,

and the pollutant is discharged into navigable waters, the source

must obtain a . . . permit limiting and controlling both the amount

and type of pollutants which can be lawfully discharged.” Nat’l

2 Wildlife Fed’n v. Consumers Power Co., 862 F.2d 580, 582 (6th Cir.

1988) (emphasis omitted); see 33 U.S.C. §§ 1311(a), 1342(a).

¶4 But there are exceptions to the permit requirement. As

relevant in this case, § 1342(l)(2) provides that a permit is not

required “for discharges of stormwater runoff from mining

operations . . . composed entirely of flows . . . which are not

contaminated by contact with, or do not come into contact with,

any overburden.” The Environmental Protection Agency (EPA)

adopted a regulation — 40 C.F.R. § 122.26(a)(2)(i) (2025) —

governing stormwater runoff from mining operations. It provides in

relevant part as follows: “The Director may not require a permit for

discharges of storm water runoff from . . . [m]ining operations

composed entirely of flows . . . which are not contaminated by

contact with[,] or that have not come into contact with, any

overburden . . . .” Id.

¶5 The EPA has authorized the Colorado Department of Public

Health and Environment (CDPHE) to administer the NPDES

permitting program in Colorado. See generally § 1342(b). Within

CDPHE, both the Water Quality Control Commission (the

Commission) and the Division carry out the program in accordance

3 with the Colorado Water Quality Control Act, §§ 25-8-101 to -1008,

C.R.S. 2024, and the state regulations promulgated thereunder.

Under Colorado’s permitting program, the Commission promulgates

regulations regarding the control of water pollutants, and the

Division enforces and administers those regulations. See § 25-8-

202, C.R.S. 2024 (the Commission’s duties); § 25-8-302, C.R.S.

2024 (the Division’s duties). With respect specifically to permitting

for discharge of pollutants, the General Assembly has directed the

Commission to “promulgate such regulations as may be necessary

and proper for the orderly and effective administration of permits”

and has mandated that such regulations “be consistent with . . .

federal requirements.” § 25-8-501(3), C.R.S. 2024.

¶6 Pursuant to these directives, the Commission promulgated

Regulation 61, 5 Code Colo. Regs. 1002-61 (Regulation 61) — the

regulation at issue in this case — which governs the permitting

process for point source stormwater discharges in Colorado. Id.;

see also 40 C.F.R. pt. 122 (2025) (Regulation 61’s federal

counterpart). It requires any “person” (as defined in Regulation

61.2(73)) to obtain a permit before discharging stormwater from a

point source associated with industrial activity. Dep’t of Pub.

4 Health & Env’t Regs. 61.2(73), 61.3(2)(e)(ii), 5 Code Colo. Regs.

1002-61; see also id. at Reg. 61.3(2)(e)(iii)(C) (including coal mining

among the types of facilities that engage in industrial activity). But,

consistent with federal law, a permit isn’t required for “stormwater

runoff from mining operations” that is “composed entirely of

flows . . . which are not contaminated by contact with[,] or that

have not come into contact with, any overburden” at the mining

site. Id. at Reg. 61.3(2)(c); accord § 1342(l)(2); 40 C.F.R.

§ 122.26(a)(2)(i); see Dep’t of Pub. Health & Env’t Reg. 61.2(71), 5

Code Colo. Regs. 1002-61 (defining “overburden” as “any material of

any nature, consolidated or unconsolidated, that overlies a mineral

deposit, excluding topsoil or similar naturally-occurring surface

materials that are not disturbed by mining operations”).

¶7 When a permit is required for discharging stormwater from a

point source, the Division “shall be solely responsible for the

[permit’s] issuance and enforcement.” § 25-8-202(7)(b)(I). As part

of this process, permittees must apply to renew their permits every

five years. See Dep’t of Pub. Health & Env’t Regs. 61.9(2)(g),

61.10(a), 5 Code Colo. Regs. 1002-61. Once the Division renews a

permit, any person affected or aggrieved by the Division’s

5 determination may request an adjudicatory hearing to challenge the

permit’s terms and conditions. Id. at Reg. 61.7(a). The person

requesting the adjudicatory hearing generally bears the burden of

proof at the hearing. Id. at Reg. 61.7(d).

II. Factual and Procedural History

¶8 The Company operates West Elk Mine, an underground coal

mine in Gunnison County. Mining operations began in the 1980s,

when the Company received permits (1) authorizing the extraction

of coal from what is now the Colorado Department of Natural

Resources’ Division of Reclamation, Mining, and Safety; and (2)

authorizing stormwater discharge flows from the mine into the

Gunnison River at multiple distinct point sources, which the parties

refer to as “outfalls,” from the Division.

¶9 The Division renewed the Company’s stormwater discharge

permit in 1995. Two years later, the Company expanded West Elk

Mine by building ventilation and access facilities, an electrical

substation, power lines, and support facilities along an access road

within Sylvester Gulch. Sylvester Gulch is south of the main

mining site, and stormwater runoff in the gulch is a tributary of the

Gunnison River.

6 ¶ 10 In 1999, the Company applied for another renewal of its

stormwater discharge permit. Its application included updated

maps reflecting the new Sylvester Gulch facilities but didn’t identify

certain outfalls in the gulch that discharge stormwater. The

Division renewed the Company’s permit in 2004.

¶ 11 When the Company applied for a third renewal permit in 2008,

it again didn’t identify certain outfalls in Sylvester Gulch that

discharge stormwater. The Division administratively extended the

Company’s permit to gather more information. An inspector from

the Division visited West Elk Mine in 2010 and 2018 and requested

additional information from the Company, including maps, a

description of its stormwater management plan, and a list of all

stormwater outfalls that the Company hadn’t identified in its

previous applications.

¶ 12 The Division renewed the Company’s permit in 2019. In

addition to the previously-regulated outfalls, the renewal permit

included seven outfalls in Sylvester Gulch (the Sylvester Gulch

outfalls) — referred to as Outfalls 25, 26, 27, 30, 32, 33, and 34 —

and one outfall near a train loading area (the train loading area

outfall) — referred to as Outfall 35. The Division imposed effluent

7 limitations on all of the outfalls. See Dep’t of Pub. Health & Env’t

Reg. 61.2(26), 5 Code Colo. Regs. 1002-61 (effluent limitations

restrict or prohibit the quantities, rates, and concentrations of

pollutants discharged from point sources).

¶ 13 The Company challenged the 2019 renewal permit on the

basis that the permit improperly included and regulated the

Sylvester Gulch outfalls and the train loading area outfall. The

Division granted the Company’s request for an adjudicatory

hearing. The presiding Administrative Law Judge (ALJ) allowed the

Center for Biological Diversity, WildEarth Guardians, High Country

Conservation Advocates, and the Sierra Club (collectively, the Public

Interest Groups) to intervene as parties.

¶ 14 After a three-day hearing, the ALJ issued an initial decision

upholding the renewal permit’s terms and conditions. CDPHE’s

executive director subsequently issued a final agency order

affirming the ALJ’s decision.

¶ 15 The Company appealed to the district court, see § 24-4-106(4),

C.R.S. 2024, which affirmed the executive director’s final agency

order.

8 III. Discussion

¶ 16 The Company challenges the inclusion of the Sylvester Gulch

outfalls in the 2019 renewal permit on five bases: (1) the outfalls

don’t require a stormwater discharge permit from the Division

because they are exempt under Regulation 61; (2) the Division

lacked jurisdiction to regulate the outfalls; (3) the Division

erroneously imposed effluent limitations on the outfalls; (4) the

Division failed to consider the permit’s economic reasonableness

before renewing it; and (5) the ALJ improperly allocated the burden

of proof at the adjudicatory hearing. We agree with the Company’s

first challenge with respect to the Sylvester Gulch outfalls and

therefore don’t address the others.

¶ 17 The Company also challenges the renewal permit’s inclusion of

the train loading area outfall but on only one of the above bases. It

contends that the stormwater regulations for this outfall must be

9 set aside because the ALJ improperly allocated the burden of proof

at the adjudicatory hearing.1 We reject that contention.

A. Standards of Review and Principles of Regulatory Construction

¶ 18 We review a final agency decision de novo, standing in the

same position as the district court. Martelon v. Colo. Dep’t of Health

Care Pol’y & Fin., 124 P.3d 914, 916 (Colo. App. 2005). We will

reverse only if the final agency decision is “arbitrary or capricious,

in excess of statutory authority, not in accord with the procedures

or procedural limitations of the [State Administrative Procedure Act]

or as otherwise required by law, an abuse or clearly unwarranted

exercise of discretion, unsupported by substantial evidence, or

otherwise contrary to law.” HCA-HealthONE LLC v. Colo. Dep’t of

Lab. & Emp., 2020 COA 52, ¶ 28 (citing § 24-4-106(7)(b)). “In

applying this standard, we presume the validity and regularity of

administrative proceedings and resolve all reasonable doubts as to

the correctness of administrative rulings in favor of the agency.”

1 The Company made additional arguments below about why the

Division shouldn’t have included the train loading area outfall in the renewal permit, but it abandons those arguments on appeal. See McLellan v. Weiss, 2024 COA 114, ¶ 10 n.2 (arguments raised below but not raised on appeal are deemed abandoned).

10 Gessler v. Grossman, 2015 COA 62, ¶ 11, aff’d sub nom. Gessler v.

Smith, 2018 CO 48.

¶ 19 We won’t disturb a hearing officer’s factual findings unless

they are clearly erroneous. Neppl v. Colo. Dep’t of Revenue, 2019

COA 29, ¶ 9; see § 24-4-106(7)(b)(VII). “The credibility of witnesses,

the weight to be afforded the evidence, and the resolution of

conflicting evidence are factual matters solely within the hearing

officer’s province as the trier of fact.” Neppl, ¶ 9 (citing Long v. Colo.

Dep’t of Revenue, 2012 COA 130, ¶ 7).

¶ 20 We construe administrative regulations de novo, giving full

effect to the promulgating body’s intent. Brunson v. Colo. Cab Co.,

2018 COA 17, ¶ 10. “In construing an administrative regulation,

we apply the same rules of construction that we would apply in

interpreting a statute.” Id. (citing Berumen v. Dep’t of Hum. Servs.,

2012 COA 73, ¶ 19). We look first to the regulation’s plain

language, “read[ing] and consider[ing] the regulatory scheme as a

whole to give consistent, harmonious, and sensible effect to all of its

parts.” Berumen, ¶ 19 (citing Cendant Corp. & Subsidiaries v. Dep’t

of Revenue, 226 P.3d 1102, 1106 (Colo. App. 2009)).

11 ¶ 21 As with a statute, if a regulation’s plain language is clear, we

enforce it as written and don’t resort to other rules of construction.

Id. But if the language is susceptible of two or more reasonable

interpretations leading to different results, the regulation is

ambiguous, and we may then “look beyond the express regulatory

language for other evidence of the promulgating body’s intent and

purpose.” Brunson, ¶¶ 15-16. As relevant in this case, we may

consider the “legislative history,” “former statutory provisions,

including laws upon the same or similar subjects,” and “[t]he

consequences of a particular construction.” § 2-4-203(1)(c)-(e),

C.R.S. 2024. We may also consider relevant “statutory history” —

“the evolution of a statute as it is amended over time by the

legislature.” Carrera v. People, 2019 CO 83, ¶ 24 n.6 (quoting Colo.

Oil & Gas Conservation Comm’n v. Martinez, 2019 CO 3, ¶ 30 n.2

(distinguishing between “statutory history” and “legislative

history”)).

¶ 22 While we defer to an agency’s reasonable interpretation of its

own regulations, we aren’t bound by an agency decision that

misapplies or misconstrues the law. El Paso Cnty. Bd. of

Equalization v. Craddock, 850 P.2d 702, 704-05 (Colo. 1993); see

12 also Kaiser v. Aurora Urb. Renewal Auth., 2024 CO 4, ¶ 30 (“An

agency’s interpretation ‘of its own rules is generally entitled to great

weight unless it is plainly erroneous or inconsistent with . . . the

underlying statute.’” (quoting Berumen, ¶ 25)).

B. Regulation 61’s Exemption Provision

¶ 23 As noted, Regulation 61 requires a permit for discharges of

stormwater associated with industrial activity. Dep’t of Pub. Health

& Env’t Reg. 61.3(1)(a), (2)(a), (2)(e)(ii), 5 Code Colo. Regs. 1002-61.

But this requirement is subject to the following exemption

provision:

The Division may not require a permit for discharges of stormwater runoff from mining operations or oil and gas exploration, production, processing or treatment operations or transmission facilities, composed entirely of flows which are from conveyances or systems of conveyances (including but not limited to pipes, conduits, ditches, and channels) used for collecting and conveying precipitation runoff and which are not contaminated by contact with or that have not come into contact with, any overburden, raw material, intermediate products, finished product, byproduct or waste products located on the site of such operations.

Id. at Reg. 61.3(2)(c) (emphases added); see also id. at Reg.

61.3(2)(a).

13 ¶ 24 The ALJ, the executive director, and the district court

interpreted the exemption provision as requiring a permit under one

of two circumstances: (1) when stormwater flows come into contact

with overburden or (2) when stormwater flows are contaminated by

contact with overburden. They upheld the Division’s decision to

require a permit for the Sylvester Gulch outfalls under the first

circumstance, reasoning that because the outfalls discharge

stormwater that contacts overburden, they aren’t exempt from the

permit requirement.

¶ 25 But the exemption provision clearly says that a permit is not

required in either of two circumstances: (1) when stormwater flows

have not contacted overburden or (2) when stormwater flows are not

contaminated by contact with overburden. The use of the

disjunctive “or” means that either circumstance independently

warrants an exemption from the permit requirement. See Lombard

v. Colo. Outdoor Educ. Ctr., Inc., 187 P.3d 565, 571 (Colo. 2008)

(“[W]e presume the disjunctive use of the word ‘or’ marks distinctive

categories.”). To put a bit of a finer point on it, if stormwater

discharge doesn’t contact overburden, a permit isn’t required, but

even if it does contact overburden, a permit isn’t required if such

14 contact doesn’t contaminate the stormwater. This interpretation of

the exemption provision gives effect to all its parts.

¶ 26 The construction adopted by the ALJ, the executive director,

and the district court, and urged by the Division and the Public

Interest Groups, does not. Rather, it renders an entire phrase

superfluous: If mere contact with overburden were enough to

require a permit, it would be pointless to identify lack of

contamination by contact as a separate circumstance under which

the Division may not require one. See Lombard, 187 P.3d at 571

(“[W]hen examining a statute’s language, we give effect to every

word and render none superfluous because we ‘do not presume that

the legislature used language idly and with no intent that meaning

should be given to its language.’” (quoting Colo. Water Conservation

Bd. v. Upper Gunnison River Water Conservancy Dist., 109 P.3d 585,

597 (Colo. 2005))); Carruthers v. Carrier Access Corp., 251 P.3d

1199, 1204 (Colo. App. 2010) (rejecting proposed interpretation of

statute that would render part of it meaningless); § 2-4-201(1)(b),

15 C.R.S. 2024 (we must presume that the General Assembly intended

that the entire statute be effective).2

¶ 27 The Division and the Public Interest Groups don’t really

contest this point. Instead, in urging us to adopt the ALJ’s, the

executive director’s, and the district court’s interpretation of the

exemption provision, the Division and the Public Interest Groups

point to a separate provision that, they say, would conflict with our

interpretation. That provision considers “mining operations . . .

that discharge stormwater contaminated by contact with[,] or that

2 It appears that, in essence, the ALJ, the executive director, and

the district court canceled out the provision’s negatives — the “not”s — to form a positive. See generally People v. Bannister, 902 N.E.2d 571, 592 (Ill. 2008) (explaining the grammatical construction of double negatives); Merriam-Webster Dictionary, https://perma.cc/QFB3-6CEC (defining “double negative” as “a now nonstandard syntactic construction containing two negatives and having a negative meaning”). But because the negatives in the exemption provision modify different words, they aren’t self- cancelling double negatives, as exemplified in phrases such as “I don’t have no money.” That is, as the regulation is written, one “not” shouldn’t be construed as being canceled out by another. Cf. Bannister, 902 N.E.2d at 592 (“A double negative ‘consists of more than one negative . . . for a single negation.’ A double negative ‘is a statement that contains two negative modifiers, the second of which repeats the message of the first.’” (first quoting Martin Steinmann & Michael Keller, Good Grammar Made Easy 112 (1995); and then quoting Lynn Quitman Troyka, Simon & Schuster Handbook for Writers 295 (2d ed. 1990))).

16 has come into contact with, any overburden” “to be engaging in

‘industrial activity.’” Dep’t of Pub. Health & Env’t Reg.

61.3(2)(e)(iii)(C), 5 Code Colo. Regs. 1002-61; see Gonzales v.

Allstate Ins. Co., 51 P.3d 1103, 1106 (Colo. App. 2002) (“[W]hen

interpreting two statutory sections, we must attempt to harmonize

them to give effect to their purposes and, if possible, reconcile

them . . . .” (citing Norsby v. Jensen, 916 P.2d 555, 559 (Colo. App.

1995))). But that provision merely describes facilities that engage in

industrial activity for purposes of the permit requirement, which

itself is subject to the exemption provision at issue. See Dep’t of

Pub. Health & Env’t Reg. 61.3(2)(e)(ii)(A), 5 Code Colo. Regs. 1002-

61. Thus, interpreting the exemption provision as we do doesn’t

create a conflict.

¶ 28 In any event, to the extent any inconsistency between

Regulation 61.3(2)(e)(iii)(C) and the exemption provision renders the

latter susceptible of more than one reasonable interpretation,

several canons of statutory construction support our conclusion

that the Division may not require a permit for uncontaminated

stormwater runoff.

17 ¶ 29 First, the statutory and legislative history of the stormwater

discharge permitting program demonstrates a clear intent to exempt

uncontaminated stormwater runoff from the permit requirement.

See § 2-4-203(1)(c)-(d) (if a statute is ambiguous, the court may

consider legislative history and former statutory provisions on the

same subject); Martinez, ¶¶ 30-36, 30 n.2 (considering “statutory

history”).

¶ 30 Shortly after Congress enacted the Clean Water Act in the

1970s, the EPA implemented regulations generally exempting

stormwater discharge from the permit requirement unless such

discharge significantly contributed to water pollution. See 40

C.F.R. § 125.4 (1975). Environmental advocacy groups successfully

challenged these regulations in court as being too limited in scope.

See, e.g., Nat. Res. Def. Council, Inc. v. Costle, 568 F.2d 1369, 1377

(D.C. Cir. 1977) (“[T]he EPA Administrator does not have authority

to exempt categories of point sources from the permit

requirements . . . .”). In response, Congress enacted the Water

Quality Act of 1987, Pub. L. No. 100-4, 101 Stat. 7 (codified as

amended at § 1342(l)-(p)), which amended the Clean Water Act by

expanding the NPDES permitting program to generally require

18 permits for industrial stormwater discharge. See § 1342(p)(2). But

in the conference report accompanying an earlier version of these

amendments,3 Congress expressed its intent to impose limits on the

expanded program:

The [amended version of the bill agreed to by the House of Representatives and Senate] . . . add[s] a provision dealing with contamination by contact with raw materials or waste products based on the Senate bill.

The [amended version] provides that permits are not required where stormwater runoff is diverted around mining operations or oil and gas operations and does not come in contact with overburden, raw material, product, or process wastes. In addition, where stormwater runoff is not contaminated by contact with such materials, as determined by the Administrator, permits are also not required.

H.R. Rep. No. 99-1004, at 151 (1986) (Conf. Rep.) (emphases

added); see Fontanari v. Snowcap Coal Co., 2023 COA 29, ¶ 30

3 The conference report accompanied Senate Bill 1128, which was

unanimously approved by the 99th Congress but pocket vetoed by the President. The following year, leaders of both houses of the 100th Congress agreed to introduce, and the House and Senate ultimately passed, H.R. 1, the Water Quality Act of 1987, containing the same provisions as the conference report from the 99th Congress. No new conference report was submitted. The President vetoed H.R. 1, and the House and Senate voted to override the veto, at which point the Water Quality Act of 1987 was enacted as Public Law 100-4. H.R. Rep. No. 100-1121, at 13-14 (1988).

19 (considering a House of Representatives report to help discern

Congress’s intent).4

¶ 31 In the preamble to the regulations implemented pursuant to

the Clean Water Act’s amendments, the EPA explained why

Congress decided to require permits for industrial stormwater

discharge but exempt uncontaminated runoff from the requirement:

Because [oil, gas, and mining facilities] have the potential for serious water quality impacts, Congress recognized . . . the need to control storm water discharges from oil, gas, and mining operations, as well as those associated with other industrial activities.

However, Congress also recognized that there are numerous situations in the mining and oil and gas industries where storm water is channeled around plants and operations through a series of ditches and other structural devices in order to prevent pollution of the storm water by harmful contaminants. From the standpoint of resource drain on both [the] EPA as the permitting agency and potential permit applicants, the conclusion was that operators that use good management practices and make expenditures to prevent

4 At oral argument, counsel for the Division tried to cast doubt on

the conference report’s applicability in this case — asserting that it applies to wastewater, not stormwater — and suggested that we should not consider it to help discern Congress’s intent. We reject that suggestion. The report’s language clearly addresses whether a discharge permit is required for stormwater runoff that contacts overburden at a mining operation.

20 contamination must not be burdened with the requirement to obtain a permit. Hence, [§ 1342(l)(2)] creates a statutory exemption from storm water permitting requirements for uncontaminated runoff from these facilities.

Nat’l Pollutant Discharge Elimination Sys. Permit Application Reg.

for Storm Water Discharges, 55 Fed. Reg. 47990-01, 48029 (Nov.

16, 1990) (codified at 40 C.F.R. pts. 122, 123, 124). The EPA

continued,

To implement [§ 1342(l)(2)], [the] EPA intends to require permits for contaminated storm water discharges from oil, gas and mining operations. Storm water discharges that are not contaminated by contact with any overburden, raw material, intermediate products, finished product, byproduct or waste products located on the site of such operations will not be required to obtain a storm water discharge permit.

Id.5

¶ 32 Though this statutory and legislative history pertains to the

federal stormwater discharge permitting program, it carries great

5 As noted above, 33 U.S.C. § 1342(l)(2) says that a permit isn’t

required if stormwater runoff is “composed entirely of flows . . . which are not contaminated with, or do not come into contact with, any overburden.” Accord 40 C.F.R. § 122.26(a)(2)(i) (2025). These federal provisions, therefore, make clear that a permit isn’t required if either the runoff doesn’t contact overburden or the runoff does contact overburden but isn’t contaminated when it does so.

21 weight in helping us construe the matching provisions of Colorado’s

program. After all, Regulation 61 governs the administration of the

federal program at the state level, and the exemption provision uses

language substantially similar to that of its federal counterpart to

“[e]nsure that Colorado’s regulations are consistent with the federal

requirements.” Dep’t of Pub. Health & Env’t Reg. 61.36(E), 5 Code

Colo. Regs. 1002-61. Compare id. at Reg. 61.3(2)(c), with 40 C.F.R.

§ 122.26(a)(2)(i), and § 1342(l)(2); see also § 25-8-501(3) (Colorado’s

regulations must be “consistent with . . . federal requirements.”).

Indeed, Regulation 61 itself says, “The Clean Water Act . . . requires

that in order to maintain delegated authority [to administer the

NPDES permitting program], a state must have regulations that are

consistent with the federal regulations” and that “[i]ncluding

stormwater discharges in an efficient manner in the [permitting]

program in the State of Colorado . . . requires that the regulations

22 be consistent with the federal rules.” Dep’t of Pub. Health & Env’t

Reg. 61.36(D)(2), 5 Code Colo. Regs. 1002-61.6

¶ 33 Second, at least one federal court has interpreted the NPDES

permitting program as exempting uncontaminated stormwater

runoff from the permit requirement. See Colo. Civ. Rts. Comm’n v.

Big O Tires, Inc., 940 P.2d 397, 399 (Colo. 1997) (federal cases

interpreting federal law, though not controlling, can be helpful

where the state statute closely parallels a federal counterpart).

¶ 34 In Natural Resources Defense Council, Inc. v. EPA, 526 F.3d

591 (9th Cir. 2008), the Ninth Circuit Court of Appeals described

the stormwater regulations in the Clean Water Act, as amended by

the Water Quality Act of 1987, explaining that the “EPA’s

interpretation of [§ 1342(l)(2)] was that [the] ‘section . . . creates a

statutory exemption from storm water permitting requirements for

uncontaminated runoff from [oil, gas, and mining] facilities.’” Id. at

596-97 (quoting 55 Fed. Reg. at 48029). True, the court analyzed

6 We recognize that Regulation 61.3(2)(c), Dep’t of Pub. Health &

Env’t Reg. 61.3(2)(c), 5 Code Colo. Regs. 1002-61, is worded slightly differently than § 1342(l)(2) and 40 C.F.R. § 122.26(a)(2)(i). But in light of the foregoing considerations, the slight differences in wording don’t justify a difference in interpretation.

23 the exemption in the context of stormwater runoff contaminated by

sediment from oil and gas construction activities, not mining

activities. See id. at 601. Still, the exemption applies across the

board to stormwater runoff from oil, gas, and mining operations.

§ 1342(l)(2). We therefore find the court’s explanation relevant to

our analysis.

¶ 35 Third, interpreting Regulation 61 as exempting

uncontaminated stormwater runoff from the permit requirement

results in a two-step process consistent with the stormwater

discharge permitting program’s framework. See § 2-4-203(1)(e) (we

may consider the “consequences of a particular construction”).

¶ 36 In the mining context, step one requires the facility proposing

a new discharge of stormwater associated with industrial activity to

apply for a permit. Dep’t of Pub. Health & Env’t Reg. 61.4(3)(a)(i), 5

Code Colo. Regs. 1002-61. Step two requires the Division to

determine whether the stormwater is contaminated by contact with

overburden (or any other material identified in the exemption

provision) and, if it is, to issue a permit regulating the stormwater

discharge. See id. at Reg. 61.3(2)(c).

24 ¶ 37 The Public Interest Groups assert that it would be impractical

for the Division to determine whether stormwater runoff is

contaminated by contact with overburden because such a

determination would require the Division to calculate background

levels of pollutants, and those levels are difficult to calculate at

mining sites.7 They claim support for their assertion in the

preamble to the EPA’s stormwater regulations:

Comments received . . . suggested that background levels of pollutants would be very difficult to calculate due to the complex topography frequently encountered in alpine mining regions. For example, if a mine is located in a mountain valley surrounded on all sides by hills, the site will have innumerable slopes feeding flow towards it. Under such circumstances, determining how the background level is set would prove impractical. . . . In many instances, data on original background levels may not be available due to long-term site activity.

....

Because of these concerns [the] EPA has decided to drop the use of background levels as a measure for determining whether a permit application is required. Accordingly, a permit application will be required when discharges of storm water runoff from mining operations come into contact with any overburden, raw

7 Notably, the Division itself doesn’t make this argument.

25 material, intermediate product, finished product, byproduct, or waste product located on the site.

55 Fed. Reg. at 48032. But the Public Interest Groups’ answer brief

omits the EPA’s statement that immediately follows:

Similar to the . . . test for oil and gas operations, [the] EPA intends to use the “contact” test solely as a permit application trigger. The determination of whether a mining operation’s runoff is contaminated will be made in the context of the permit issuance proceedings.

If the owner or operator determines that no storm water runoff comes into contact with overburden, raw material, intermediate product, finished product, byproduct, or waste products, then there is no obligation to file a permit application. This framework is consistent with the statutory provisions of [§ 1342(l)(2)] and is intended to encourage each mining site to adopt the best possible management controls to prevent such contact.

55 Fed. Reg. at 48032. While the EPA acknowledged the difficulty

with calculating background levels of pollutants at mining sites, it

addressed that difficulty, not by abandoning the calculation

requirement altogether, but by placing the onus on the permitting

authority to calculate those levels after a permit application has

been submitted. See Nat. Res. Def. Council, Inc. v. EPA, 966 F.2d

26 1292, 1306-08 (9th Cir. 1992) (explaining that the NPDES

exemption gives the EPA Administrator discretion to determine

whether stormwater runoff at oil and gas facilities is contaminated

and noting, in dicta, that the provision “requires consideration of

background levels of any pollutant only with respect to mining

operations”).8

¶ 38 We also reject the Division’s assertion that interpreting

Regulation 61 as exempting uncontaminated stormwater runoff

from the permit requirement “would upend stable permitting

processes and policies.” The requirement that permittees apply to

renew their stormwater discharge permits every five years allows

the Division to gather new information, re-evaluate best practices

for managing stormwater flows, and update the permits’ terms and

conditions. See Dep’t of Pub. Health & Env’t Regs. 61.9(2)(g),

61.10(a), 5 Code Colo. Regs. 1002-61. Thus, to the extent the

Division has been issuing permits based only on determinations

8 Indeed, considering background levels of pollutants is especially

important in light of Congress’s intent in enacting the Clean Water Act — to eliminate the discharge of pollutants into navigable waters. See 33 U.S.C. § 1251(a)(1). The Division and the Public Interest Groups don’t explain how regulating uncontaminated stormwater runoff would serve that goal.

27 that stormwater flows merely contact overburden, it will have the

opportunity to review and correct those permits during the renewal

process. Indeed, one of the Division’s employees testified before the

ALJ that the Division doesn’t take a prior permit’s terms as a given

because “we do a complete review when we’re renewing a permit.

So we review all the materials over again. We look at any changes

in, you know, law or rule or standards. . . . And we look at

whether, you know — if we had made an error in a previous permit,

we correct that — that permit, that error.”

¶ 39 In sum, we conclude that the plain language of Regulation

61’s exemption provision is clear: The Division may not require a

discharge permit for stormwater that contacts overburden (or any

other material identified in the exemption provision) but isn’t

contaminated by such contact. Likewise, the Division may not

require a discharge permit for stormwater that never contacts

overburden in the first instance. To the extent the provision could

be interpreted as ambiguous, the statutory and legislative history,

federal case law, and practical consequences of construing the

provision as we have (versus how the Division and the Public

Interest Groups would have us do) indicate the enacting authority’s

28 intent to exempt uncontaminated stormwater runoff from the

¶ 40 The Division issued the Company’s renewal permit without

first determining whether the stormwater discharged from the

Sylvester Gulch outfalls is contaminated by contact with

overburden. While we could remand the case for further

proceedings to determine whether there is contamination, we don’t

need to do so in this case because uncontested evidence in the

record shows that the stormwater from the Sylvester Gulch outfalls

isn’t contaminated by contact with overburden. See Scherr v. Colo.

Dep’t of Revenue, 49 P.3d 1217, 1219-20 (Colo. App. 2002) (when a

hearing officer’s order erroneously interpreted the law in a driver’s

license revocation proceeding, remand for further findings was

inappropriate because undisputed evidence showed the licensee’s

breath alcohol content test was invalid); cf. Larimer Cnty. Bd. of

Comm’rs v. Colo. Prop. Tax Adm’r, 2013 COA 49M, ¶¶ 92-96 (when

the board of commissioners denied an organization’s application for

property tax exemptions based on a flawed interpretation of the law,

remand was necessary because the record evidence as to whether

29 the organization qualified for the exemptions under the correct legal

standard remained in dispute).

¶ 41 At the adjudicatory hearing, the Company presented evidence

that the concentration of settleable solids detected in the

stormwater discharged by the Sylvester Gulch outfalls doesn’t

exceed that which would naturally be present in stormwater in

Sylvester Gulch had the Company not developed facilities therein.

See H.R. Rep. No. 99-1004, at 151 (1986) (Conf. Rep.) (stormwater

runoff at a mining site is “contaminated by contact” with

overburden if its concentration of overburden exceeds natural

background levels). For example, the Company presented soil and

water quality data, discharge monitoring reports, and computer

modeling data indicating that the concentration of settleable solids

present in the stormwater is at or below natural background levels.

Multiple expert witnesses testified that, based on this data and the

Company’s best management practices, the concentration of

settleable solids present in the stormwater is the result of “erosion

of the natural undisturbed soils” rather than mining activity.

¶ 42 The Division didn’t refute this evidence or otherwise present

any evidence indicating that the stormwater discharged from the

30 Sylvester Gulch outfalls is contaminated by contact with

overburden or any other material identified in Regulation 61’s

exemption provision. Indeed, the ALJ observed that “[t]he Division

does not advance the argument that [the Sylvester Gulch outfalls]

are in fact contaminated.” Nor did the Division advance such an

argument before the executive director or the district court, and it

does not do so before this court on appeal.9

¶ 43 Accordingly, we reverse the district court’s judgment in part

and remand the case with directions to order the Division to remove

the stormwater discharge regulations for the Sylvester Gulch

outfalls from the Company’s renewal permit.

C. Burden of Proof

¶ 44 The Company also contends that the renewal permit’s terms

and conditions regarding the train loading area outfall must be set

aside because the ALJ improperly allocated the burden of proof at

9 At oral argument, the Division’s attorney suggested that contact is

nearly synonymous with contamination, and we can tell by looking at monitoring reports. But the Division didn’t make this argument in the proceedings below or its brief on appeal. Therefore, we don’t need to consider it. Weld Cnty. Colo. Bd. of Cnty. Comm’rs v. Ryan, 2023 CO 54, ¶ 18 n.10 (an appellate court won’t consider an argument raised for the first time at oral argument). In any event, this argument, too, fails to give effect to all the relevant language.

31 the adjudicatory hearing to the Company instead of the Division.10

We disagree with this contention.

¶ 45 As noted, once the Division renews a permit, any person

affected or aggrieved by the Division’s determination may request

an adjudicatory hearing to challenge the permit’s terms and

conditions and generally bears the burden of proof at the hearing.

Dep’t of Pub. Health & Env’t Reg. 61.7(a), (d), 5 Code Colo. Regs.

1002-61. But there are two circumstances in which the Division

bears the burden of proof: (1) when “the Division initiated the

permit revocation or modification” and (2) when “the Division denies

renewal of a permit or changes the terms of a renewed permit and

that denial or change is not based either upon significant changes

in the facts relevant to water quality considerations or upon

changes in the applicable statutes or regulations.” Id. at Reg.

61.7(d)(i)-(ii).

¶ 46 The Company argues that the second circumstance applies

because the Division’s decision to include the train loading area

10 The Company also challenges the renewal permit’s terms and

conditions regarding the Sylvester Gulch outfalls on this basis. Because we conclude that the Sylvester Gulch outfalls are exempt from the permit requirement, we don’t address that challenge.

32 outfall in the 2019 renewal permit wasn’t based on significant

changes in the law or facts. It reasons that the outfall existed

before the Division renewed the Company’s discharge permit in

2004 and that the Division “had all the necessary information”

about the outfall at that time because (1) an inspector from the

Division visited West Elk Mine in 2000, and (2) the Company’s 1999

application included a map of the train loading area — a map

substantially similar to the one the Company included in its 2008

application, which formed the basis for the 2019 renewal permit.

¶ 47 Even if the train loading area outfall existed before the

Division renewed the Company’s permit in 2004, substantial

evidence in the record supports the ALJ’s determination that the

Division based its decision to include the train loading area outfall

in the 2019 renewal permit on significant changes in facts it didn’t

learn about until the most recent renewal permitting process. The

Division employee assigned to handle the Company’s renewal

permit testified that the Division administratively extended the

Company’s 2004 permit to gather more information after the

Company had submitted its 2008 application. During the extension

period, the employee “started fresh” by visiting a sedimentation

33 pond in the train loading area outfall and requesting additional

information regarding the Company’s stormwater management at

the mine, including updated site maps and descriptions with the

precise locations of all industrial stormwater outfalls not previously

identified. And, in writing the Company’s 2019 renewal permit, the

employee determined the train loading area outfall required

regulation based on her personal observation of it and the

additional information the Company had provided.

¶ 48 This evidence is sufficient to support the ALJ’s findings.

Therefore, we conclude that, with respect to the train loading area

outfall, the ALJ properly allocated the burden of proof at the

adjudicatory hearing to the Company.

¶ 49 Because the Company doesn’t otherwise challenge the renewal

permit’s inclusion of the train loading area outfall, we affirm the

district court’s judgment insofar as it affirms the Division’s decision

to regulate that outfall.

IV. Disposition

¶ 50 The district court’s judgment is reversed in part and affirmed

in part. We remand the case to the district court to order the

Division to remove the stormwater discharge regulations for the

34 Sylvester Gulch outfalls (identified in the permit as Outfalls 25, 26,

27, 30, 32, 33, and 34) from the Company’s 2019 renewal permit.

JUDGE KUHN and JUDGE MOULTRIE concur.