May 20, 2014Client Alert

Challenges to Wastewater Discharge Permits Must be Directed First to the Wisconsin Department of Natural Resources

Individuals or groups seeking to challenge aspects of wastewater discharge (WPDES) permits issued by the Wisconsin Department of Natural Resources (DNR) must first seek a contested case before DNR prior to bringing a court challenge. That is the conclusion reached by the Wisconsin Court of Appeals late last month when it rejected two separate arguments made by a citizen group seeking to forego agency review and jump right to the circuit court. The decision confirmed an application of the relevant law that has guided DNR, permittees, and citizen groups for over 30 years.


On April 29, 2014, the Court of Appeals released its decision in Clean Water Action Council of Northeast Wisconsin v. Dept. of Natural Resources, in which Clean Water Action Council of Northeastern Wisconsin, Inc. (CWAC) challenged aspects of a WPDES wastewater discharge permit DNR issued to Appleton Coated LLC. At issue was whether CWAC was required to first seek DNR’s review of the challenged permit terms in a contested case proceeding by filing a petition pursuant to Wis. Stat. § 283.63. That section provides that DNR’s decision following the contested case proceeding is subject to review in the circuit court.


CWAC argued that the contested case procedure described in § 283.63 presents an optional layer of administrative review on top of judicial review, but that § 283.63 does not impose administrative review as a mandatory step. The Court of Appeals rejected that argument and held that § 283.63 provides the exclusive procedure for challenging a WPDES permit, which cannot be circumvented by a premature judicial review petition. Moreover, the Court of Appeals noted that a 1981 decision of the Wisconsin Supreme Court in Sewerage Commission v. Dept. of Natural Resources answered this very question, stands as controlling precedent, and has been the law for over 30 years.


CWAC next argued that § 283.63 cannot be the exclusive means of seeking review of WPDES permit terms because that section requires that the petition be presented by five or more persons. As a single “person” under the law, CWAC argued that § 283.63 precluded it from obtaining any review of Appleton Coated LLC’s WPDES permit, in violation of 40 C.F.R. § 123.30, a federal Clean Water Act regulation that prohibits states from narrowly restricting the class of persons who may obtain review of WPDES permitting decisions. The Court of Appeals rejected this argument on two grounds. First, it noted that it is the role of the United States Environmental Protection Agency, and not state courts, to determine whether Wis. Stat. ch. 283 is consistent with the Clean Water Act. That issue was conclusively decided in the 2011 Wisconsin Supreme Court decision in Andersen v. Dept. of Natural Resources. Second, it observed that CWAC had not demonstrated that Wisconsin’s requirement that five or more persons jointly petition DNR for review of a WPDES permit even runs afoul of the federal requirement.


Finally, the Court of Appeals noted that CWAC relied heavily for its arguments on a January 2012 letter from the Wisconsin attorney general to DNR. The Court observed that the letter: 1) is not a formal attorney general opinion; 2) is inconsistent with the Wisconsin Supreme Court’s decision in Sewerage Commission; and 3) would produce an illogical result in which groups of five or more persons are required to seek a contested case hearing while groups of four or less persons could proceed directly to court. The Court of Appeals also explained that contested case proceedings perform a valuable function by providing context and explanation for the types of lengthy and highly technical records that are generally developed by DNR when making environmental permitting decisions. Without the benefit of a prior contested case proceeding, it could be difficult for a reviewing court to ascertain which facts in the record were actually relied upon by DNR in its decision-making.


The practical result of CWAC decision is that that citizen petitioners seeking to challenge individual WPDES permits must seek out four or more like-minded persons and go through the contested case procedure set forth in § 283.63 before seeking review in the courts. However, since this decision merely confirms the Sewerage Commission decision that has been on the books for over thirty years, it does not actually reflect a procedural change under Wisconsin law.

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