Industrial Liaison Committee of Niagara Falls Area Chamber of Commerce v. Williams

Majority

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In the Matter of Industrial Liaison Committee of the Niagara Falls Area Chamber of Commerce et al., Appellants, v Henry G. Williams, as Commissioner of Environmental Conservation, Respondent, and Hudson River Sloop Clearwater, Inc., et al., Intervenors-Respondents. (And Another Related Proceeding.)

Argued May 31, 1988;

decided July 12, 1988

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POINTS OF COUNSEL

John Hanna, Jr., and Philip H. Dixon for appellants.

I. The Department of Environmental Conservation denied the public any opportunity for meaningful comment on the proposed regulations. (Kurcsics v Merchants Mut. Ins. Co., 49 NY2d 451 ; Weyerhaeuser Co. v Costle, 590 F2d 1011 ; Connecticut Light & Power Co. v Nuclear Regulatory Commn., 673 F2d 525 ; Kennecott v United States Envtl. Protection Agency, 780 F2d 445 ; National Assn. of Metal Finishers v Environmental Protection Agency, 719 F2d 624 , revd on other grounds sub nom. Chemical

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Mfrs. Assn. v NRDC, 470 US 116 ; United States v Nova Scotia Food Prods. Corp., 568 F2d 240 ; Portland Cement Assn. v Ruckelshaus, 486 F2d 375 , 417 US 921 ; National Crushed Stone Assn. v Environmental Protection Agency, 601 F2d 111 , 449 US 64 .) II. DEC violated the State Environmental Quality Review Act. (Matter of Jackson v New York State Urban Dev. Corp., 67 NY2d 400 ; Chinese Staff & Workers Assn. v City of New York, 68 NY2d 359 .)

Robert Abrams, Attorney-General (Francis J. Keehan, O. Peter Sherwood, Peter H. Schiff and Douglas H. Ward of counsel), for respondent.

I. DEC fully complied with the substantive and procedural requirements of SEQRA. (Matter of Jackson v New York State Urban Dev. Corp., 67 NY2d 400 ; Coalition Against Lincoln W. v City of New York, 94 AD2d 483 , 60 NY2d 805 ; Matter of Environmental Defense Fund v Flacke, 96 AD2d 862 ; Aldrich v Pattison, 107 AD2d 258 ; Matter of Niagara Recycling v Town Bd., 83 AD2d 335 , 56 NY2d 859 ; Sierra Club v Morton, 510 F2d 813 ; Township of Lower Alloways Creek v Public Serv. Elec. Gas Co., 687 F2d 732 ; Vermont Yankee Nuclear Power Corp. v NRDC, 435 US 519 ; Matter of Town of Henrietta v Department of Envtl. Conservation, 76 AD2d 215 .) II. DEC complied with the relevant provisions of the State Administrative Procedure Act. (Flacke v Onondaga Landfill Sys., 69 NY2d 355 ; Matter of Rostlee Assocs. v Amelkin, 121 AD2d 725 ; Matter of Frishman v Schmidt, 96 AD2d 1043 , 61 NY2d 823 ; Connecticut Light & Power Co. v Nuclear Regulatory Commn., 673 F2d 525 .)

Philip Weinberg for intervenors-respondents.

I. Appellants’ challenges based on the State Administrative Procedure Act, mostly not raised by them at Special Term, are hypertechnical and without substance. The Department of Environmental Conservation fully met the requirements of the State Administrative Procedure Act, and appellants’ familiarity with the Technical and Operational Guidance Series, essentially similar to these standards, totally undermines their claimed lack of notice or opportunity to comment. (Carples v Cumberland Coal & Iron Co., 240 NY 187 ; Segar v Youngs, 45 NY2d 568 ; Gilmour v Colcord, 183 NY 342 ; Lustfogel v Bodek, 264 App Div 702 , 265 App Div 991 , 290 NY 931 ; Hecht v City of New York, 60 NY2d 57 ; Matter of Arbor Oaks Civic Assn. v Zoning Bd. of Appeals, 112 AD2d 988 , 66 NY2d 604 ; Matter of City School Dist. v Tonawanda Educ. Assn., 64 NY2d 645 ; Matter of Plato’s Cave Corp. v State Liq. Auth., 68 NY2d 791 ; Golden

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v Metropolitan Transp. Auth., 126 AD2d 128 .) II. Appellants, whose interests are economic, lack standing to challenge the Department’s compliance with SEQRA. In any event the impact statement conscientiously discussed the consequences of, and alternatives to, those standards. There was nothing arbitrary or capricious in its consideration of those elements, and, as both courts below properly held, the statement amply satisfied the mandate of the act. (County of Franklin v Connelie, 95 Misc 2d 189 , 68 AD2d 1000 ; Matter of New York State Bldrs. Assn. v State of New York, 98 Misc 2d 1045 ; Seawall Assocs. v City of New York, 134 Misc 2d 187 ; Matter of United Petroleum Assn. v Williams, 102 AD2d 491 , 65 NY2d 708 ; Aldrich v Pattison, 107 AD2d 258 ; Matter of Schiff v Board of Estimate, 122 AD2d 57 ; Matter of Bernstein v Toia, 43 NY2d 437 ; Matter of Sigety v Ingraham, 29 NY2d 110 ; Coalition Against Lincoln W. v City of New York, 94 AD2d 483 , 60 NY2d 805 .)

OPINION OF THE COURT

This case is about the State regulating the quality of its waters and preventing direct pollution of those waters by industrial users and dischargers. A wave of environmental acronyms and jargon, and the "high tech” complexity of this matter, could easily becloud the fundamental issue: Did the Department of Environmental Conservation (the Department), in its procedures for and promulgation of amended regulations as to water quality standards, violate statutory requirements of notice and of meaningful opportunity to be heard? We agree with the lower courts, but for different reasons, that the Department should prevail and we affirm.

Appellant Industrial Liaison Committee (the Committee) is an unincorporated association of approximately 25 self-described "significant industrial dischargers” into the Niagara Falls Wastewater Treatment Plant and into the surface waters of the State. The Committee, with two of its industrial members, instituted an article 78 proceeding seeking to annul the Department’s amendments to 6 NYCRR parts 701 and 702 as violative of the requirements of the State Administrative Procedure Act, State Environmental Quality Review Act (SEQRA), and the Environmental Conservation Law (ECL).

This controversy concerns ambient water quality standards which are used on a substance specific basis to determine

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effluent limitations in permits issued under the State Pollutant Discharge Elimination System (SPDES). The permits, on an applicant specific basis, set water-quality-based-discharge limitations for regulated substances. Prior to the promulgation of the water quality standards at issue in this case, the Department had on a case-by-case basis utilized numerical criteria contained in a nonpromulgated Technical and Operational Guidance Series (TOGS) to set effluent discharge limits in SPDES permits. When the Department initially proposed and considered formal regulations, it intended that they should reflect the methodology used in calculating ambient water quality standards and that the existing TOGS numerical guidance criteria for approximately 200 toxic substances be issued as an appendix to 6 NYCRR part 701.

Public meetings, conferences, seminars and workshops on water quality standards were held throughout the State for more than six months prior to the publication of the notice of proposed rule making. Notice of proposed rule making containing the public hearing dates was filed with the Secretary of State on September 11, 1984 and published in the State Register on September 26, 1984 (State Administrative Procedure Act § 202 [1] [f] [ii]). On September 14, 1984, the Department published a notice of public hearing in accord with ECL 17-0301 (4) which also provided information on how to obtain copies of the Draft Generic Environmental Impact Statement (DGEIS), the proposed amendments, the Regulatory Impact Statement (RIS), and the Regulatory Flexibility Analysis. Legal notice of the public hearing dates was published in newspapers of general circulation on September 25, direct mailed to some 6,000 interested individuals, industry representatives and municipalities, and published in the Department’s Environmental Notice Bulletin on October 3,1984.

Due to the technical nature of the proposed rule amendments, the Department made available 183 "fact sheets” containing aquatic based and human health based background data for the numerical water quality standards on the 95 enumerated chemical and metallic substances which were included in the finally promulgated regulations. It withdrew from the proposed rule amendments the balance of the substances for which fact sheets were not provided; it also withdrew any proposed toxic substances for which the originally proposed numerical standard varied by a factor of plus or minus 20% from its fact sheet.

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Public hearings were held in November 1984 on five different dates in separate locations around the State. The comment period was twice extended so it did not close until three months after the last of the public hearings and five weeks after the last set of fact sheets was made available. There was extensive public comment on the proposed amendment which was responded to in a "Responsiveness Summary” made part of the final generic environmental impact statement (FGEIS). The ambient water quality standards which were finally adopted retained the exact TOGS numerical limits for the substantial majority of the substances. For 5 of the 95 substances, the amendments were more stringent than the ambient water quality standards which had existed under the TOGS criteria.

The article 78 proceeding was disposed of by the Supreme Court rejecting, on the merits, each of the technical and legal claims advanced by the Committee and dismissing the petitions. The Appellate Division unanimously affirmed and we granted leave to appeal.

We hold that statutory requirements for public notice, for meaningful comment and for opportunity to be heard were satisfied in this case. The Department’s proposal of regulations formalizing specific scientific standards already in use by the administrative agency and disclosure of the scientific basis for all finally adopted standards complied with statutory prerequisites under all the facts, circumstances and history attending this particular rule amendment process. When a new regulatory provision adopts existing standards which predate the enactment of State Administrative Procedure Act § 202-a and results in no new significant economic changes for the regulated community, it is not error to fail to provide a detailed administrative explication in a Regulatory Impact Statement of the economic impacts of the promulgation of those parts. Similarly, it is not arbitrary and capricious or a violation of existing law for the agency, when it takes its "hard look” and makes its "reasoned determination” under SEQRA, to ignore speculative environmental consequences which might arise under the new or amended regulation.

We note at the outset that the Appellate Division employed the incorrect standard of review concerning the Department’s compliance with the State Administrative Procedure Act. Regulatory promulgation consistent with the provisions of the State Administrative Procedure Act is not a

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matter which rests within the particular and specialized expertise of the Department. Interpretation of the State Administrative Procedure Act is not dependent on an understanding of technical data or underlying operational practices. The statute outlines uniform administrative procedures that State agencies must follow in their rule making, adjudicatory and licensing processes and that courts review in their usual de novo adjudicative function. Thus, the legislative direction to these agencies is compliance, not implementation. As specialized knowledge is not necessarily implicated, the courts use their own competence to decide issues of law raised, since those questions are of ordinary statutory reading and analysis (see, Matter of Town of Mamaroneck PBA v New York State Pub. Employment Relations Bd., 66 NY2d 722 , 724). Our reasoning does not mean that an agency’s special expertise will never be relevant or specially respected as to a question arising under the State Administrative Procedure Act (see, Vermont Yankee Nuclear Power Corp. v NRDC, 435 US 519 ), but that the principle of deference should be applied only where such expertise is relevant. It is not in this case.

At the time these regulations were proposed, the State Administrative Procedure Act provided that ”[u]nless a different time is specified by statute, the notice of proposed rule making must appear in the state register at least thirty days prior to * * * the first public hearing on a proposed rule” (State Administrative Procedure Act § 202 [1] [a] [ii]). Copies of the complete text of the proposed rule, the RIS, and the Regulatory Flexibility Analysis are to be made available to the public on the date notice is first given (State Administrative Procedure Act § 202 [1] [e]). If the complete text of the proposed rule, RIS, or Regulatory Flexibility Analysis exceeds 2,000 words, the notice shall include a summary of that item (State Administrative Procedure Act § 202 [1] [f] [iii], [iv], [v]). The promulgation of a new rule must be done in substantial compliance with the State Administrative Procedure Act’s provisions (State Administrative Procedure Act § 202 [8]).

The Department provided notice of its intention to promulgate the amendments to the regulations more than five weeks before the first public hearing, alerted the public (including, of course, these affected petitioners) to the fact that "[t]he proposed revisions describe methodologies and protocol used to develop numeric standards for toxic substances in New York State water for the protection of human health, fish and wildlife”, and provided a synopsis of the RIS, Regulatory

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Flexibility Analysis and the proposed amendments. The last set of fact sheets on the standards actually promulgated was made available to the public, although not required as a condition of the notice under the State Administrative Procedure Act, more than a month before the close of the hearing comment period. This notice complied with the State Administrative Procedure Act requirements and was adequate to provide a timely opportunity for meaningful comment.

On these facts, the RIS also adequately provided "[a] statement indicating the projected costs (i) for the implementation of, and continuing compliance with, the rule” (State Administrative Procedure Act § 202-a [3] [c]), by setting forth the additional expenditures required by the amendments. The Department concluded that the majority of the ambient water quality standards would have no significant economic impact due to the fact that the numerical values were not sufficiently different from those used for deriving effluent limitations under the TOGS’ criteria as to have a fiscal impact on holders of SPDES’ permits. Thus, the Department furnished projected costs only for those standards which replaced existing TOGS criteria with more stringent ambient water quality standards resulting in additional costs to regulated entities. Insofar as the TOGS standards were informally adopted prior to the enactment of the RIS requirement (L 1983, ch 344 [eff Jan. 1, 1984]), the economic impact associated with the introduction of TOGS arose before economic impact analysis was mandated and the Department’s decision not to discuss the impacts at the time of regulatory enactment is not an attempt at impermissible bootstrapping as the Committee argues.

The Committee’s primary procedural complaint flows from what it claims the Department failed to do in providing timely notice and disclosure of the background data upon which the Department relied in setting the ambient water quality standards. ECL 17-0301 (4) provides that "[t]he department, after proper study, and after conducting public hearings upon due notice, shall adopt and assign standards of quality and purity for each such classification necessary for the public use or benefit contemplated by such classification” (emphasis supplied). The notice of public hearing issued in accord with ECL 17-0301 (4) provided notice of the proposed hearing dates, which were commenced at least 15 days after the filing of notice of completion of the DGEIS but within 60 days thereof (see, ECL 8-0109 [5]; 6 NYCRR 617.8 [d] [2]). Thus, the Department did all it was supposed to do.

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Nothing in the statute or regulations governing environmental impact statements requires an agency to make the raw data upon which its environmental impact statement is based available to the public (Matter of Jackson v New York State Urban Dev. Corp., 67 NY2d 400 , 422). Also persuasive is that the Department, on its own initiative and consistent with our view that the public comment purpose of SEQRA is best served by broad disclosure (id., at 422), made the fact sheets available to the public and only promulgated those regulations, for which it had allowed at least five weeks to comment on, after the release of the fact sheets.

Substantively, the Department addressed the significant nonspeculative environmental impacts which could be anticipated as a consequence of the promulgation of the amendments in the relevant DGEIS and FGEIS (see, Matter of Jackson v New York State Urban Dev. Corp., supra, at 417; Aldrich v Pattison, 107 AD2d 258 , 266; Coalition Against Lincoln W. v City of New York, 94 AD2d 483 , 491, affd 60 NY2d 805 ; 6 NYCRR 617.14 [c] [need only discuss impacts which can be reasonably anticipated]). It took a hard look at the need for the numerical standards and their purpose, explained the methodology employed, the benefits the standards would produce, and the alternatives to the methods used. Insofar as the amendments would require a decrease in toxic discharges, the Department found that they had a positive environmental effect and that there were no adverse effects to be minimized.

The protagonists in respective briefs characterized this case as "the most important administrative law case of the 1980’s” (appellant’s brief, at 21) or "a run-of-the-mill Article 78” (intervenor’s brief, at 12). It is neither. Important principles of rule making by the principal environmental administrative agency were at work in a critical regulatory area. We conclude that the governing statutes were satisfied by the Department in the complex interplay and over-all history of procedural developments in this case based on ordinary rules of judicial review and interpretation of applicable statutory bodies of law like the State Administrative Procedure Act.

The remaining issues presented by the parties have also been considered and are without merit.

Accordingly, the order of the Appellate Division should be affirmed, with costs.

Chief Judge Wachtler and Judges Simons, Kaye, Alexander, Titone and Hancock, Jr., concur.

Order affirmed, with costs.

Cases cited

Kurcsics v. Merchants Mutual Insurance 49 NY2d 451 N.Y. 1980-02-20 p. 139
Chemical Manufacturers Ass'n v. Natural Resources Defense Council, Inc. 470 US 116 SCOTUS 1985-02-27 p. 140
Environmental Protection Agency v. National Crushed Stone Ass'n 449 US 64 SCOTUS 1980-12-02 p. 140
Jackson v. New York State Urban Development Corp. 67 NY2d 400 N.Y. 1986-05-08 at 422 p. 140, p. 146
Chinese Staff & Workers Ass'n v. City of New York 68 NY2d 359 N.Y. 1986-11-18 p. 140
Coalition Against Lincoln West, Inc. v. City of New York 94 AD2d 483 N.Y. App. Div. 1983-07-07 at 491 p. 140, p. 141, p. 146
Coalition Against Lincoln West, Inc. v. City of New York 60 NY2d 805 N.Y. 1983-10-27 p. 140, p. 141, p. 146
Environmental Defense Fund, Inc. v. Flacke 96 AD2d 862 N.Y. App. Div. 1983-08-08 p. 140
Aldrich v. Pattison 107 AD2d 258 N.Y. App. Div. 1985-03-04 at 266 p. 140, p. 141, p. 146
Niagara Recycling, Inc. v. Town Board of Niagara 83 AD2d 335 N.Y. App. Div. 1981-11-13 p. 140
Niagara Recycling, Inc. v. Town Board of Niagara 56 NY2d 859 N.Y. 1982-06-10 p. 140
Vermont Yankee Nuclear Power Corp. v. Natural Resources Defense Council, Inc. 435 US 519 SCOTUS 1978-04-03 p. 140, p. 144
Town of Henrietta v. Department of Environmental Conservation 76 AD2d 215 N.Y. App. Div. 1980-07-10 p. 140
Flacke v. Onondaga Landfill Systems, Inc. 69 NY2d 355 N.Y. 1987-03-31 p. 140
Rostlee Associates, Ltd. v. Amelkin 121 AD2d 725 N.Y. App. Div. 1986-06-30 p. 140
Frishman v. Schmidt 61 NY2d 823 N.Y. 1984-02-16 p. 140
Carples v. Cumberland Coal & Iron Co. 240 NY 187 N.Y. 1925-05-05 p. 140
Segar v. Youngs 45 NY2d 568 N.Y. 1978-10-31 p. 140
Gilmour v. Colcord 183 NY 342 N.Y. 1906-01-09 p. 140
Hecht v. City of New York 60 NY2d 57 N.Y. 1983-09-15 p. 140
Arbor Oaks Civic Ass'n of Dix Hill, Inc. v. Zoning Board of Appeals 112 AD2d 988 N.Y. App. Div. 1985-08-12 p. 140
Murphy v. Southside Hospital 64 NY2d 645 N.Y. 1984-11-29 p. 140
Golden v. Metropolitan Transportation Authority 126 AD2d 128 N.Y. App. Div. 1987-03-02 p. 141
County of Franklin v. Connelie 95 Misc 2d 189 N.Y. Sup. Ct. 1978-05-24 p. 141
County of Franklin v. Connelie 68 AD2d 1000 N.Y. App. Div. 1979-03-29 p. 141
New York State Builders Ass'n v. State 98 Misc 2d 1045 N.Y. Sup. Ct. 1979-02-22 p. 141
Seawall Associates v. City of New York 134 Misc 2d 187 N.Y. Sup. Ct. 1986-12-22 p. 141
United Petroleum Ass'n v. Williams 102 AD2d 491 N.Y. App. Div. 1984-07-12 p. 141
Schiff v. Board of Estimate 122 AD2d 57 N.Y. App. Div. 1986-07-07 p. 141
Bernstein v. Toia 43 NY2d 437 N.Y. 1977-12-21 p. 141
In re Sigety v. Ingraham 29 NY2d 110 N.Y. 1971-07-07 p. 141
Town of Mamaroneck PBA, Inc. v. New York State Public Employment Relations Board 66 NY2d 722 N.Y. 1985-10-22 at 724 p. 144