Ariosa v. Md. Dep't of Env't

MICHAEL ARIOSA v. MARYLAND DEPARTMENT OF ENVIRONMENT

No. 2105

COURT OF SPECIAL APPEALS OF MARYLAND

September Term, 2019

June 17, 2021

Circuit Court for Baltimore City

Case No. 24-C-19-002981

UNREPORTED

Nazarian, Friedman, Kenney, James A., III (Senior Judge, Specially Assigned), JJ.

Opinion by Kenney, J.

*This is an unreported opinion, and it may not be cited in any paper, brief, motion, or other document filed in this Court or any other Maryland Court as either precedent within the rule of stare decisis or as persuasive authority. Md. Rule 1-104.

This case stems from an Administrative Complaint, Order, and Penalty issued by the Maryland Department of the Environment (the "Department") to Michael Ariosa, appellant, in which the Department assessed an administrative fine of $35,000.00 based on Mr. Ariosa's purported failure to comply with the Reduction of Lead Risk in Housing Act. Mr. Ariosa contested the amount of the fine in the Office of Administrative Hearings ("OAH"), and a hearing was held before an Administrative Law Judge ("ALJ"). The ALJ ultimately affirmed the amount of the Department's administrative penalty against Mr. Ariosa. Mr. Ariosa later sought judicial review of the ALJ's decision in the Circuit Court for Baltimore City, which also affirmed. In this appeal, Mr. Ariosa presents five questions, which we have rephrased and consolidated into a single question¹:

Did the ALJ err in finding that the amount of the Department's administrative penalty against Mr. Ariosa was reasonable?

For reasons to follow, we hold that the ALJ did not err, and therefore affirm the judgment of the circuit court.

BACKGROUND

Mr. Ariosa is the sole owner of a rental property located at 3632 Keswick Road, Baltimore, Maryland (the "Property"), which was built prior to 1950 and thus subject to certain requirements pursuant to the Reduction of Lead Risk in Housing Act (the "Act"). Under the Act, an owner of a property that was constructed before 1950 and that contains at least one rental dwelling unit ("Affected Property") must, among other things, register the property with the Department and provide the Department with certain information. See Md. Code, Envir. § 6-801, et. seq. The Act states that, upon a change in occupancy at an Affected Property, the owner must have the property inspected and certified compliant with the lead-risk-reduction standards of the Act. See Md. Code, Envir. § 6-815. The Act also states that, when a child under the age of six or a pregnant woman resides or regularly spends at least 24 hours at an Affected Property ("Person at Risk"), the owner must comply with certain additional lead-reduction standards. See Md. Code, Envir. §§ 6-817 and 6-819. In the event of a violation of those provisions of the Act, the Department may assess an administrative penalty of up to $500.00 per day that the Affected Property is out of compliance, but the penalty cannot exceed $100,000.00 in total. See Md. Code, Envir. § 7-266. Before assessing a penalty, the Department must consider the following factors: the willfulness of the violation; any actual harm to the environment or human health; thecost of cleanup; the nature and degree of injury to or interference with health and property; the extent to which the location of the violation poses a danger to the environment or human health or safety; the available technology and economic reasonableness of eliminating the violation; the degree of hazard posed; and the extent to which the current violation is part of a recurrent pattern of violations. Id.

On September 13, 2004, Mr. Ariosa registered the Property with the Department. Mr. Ariosa informed the Department that a tenant had begun occupying the Property on August 10, 2004. He did not, however, provide information as to whether a "lead inspection certificate" had been obtained for the Property. On January 14, 2008, Mr. Ariosa renewed the registration for the Property, but he failed again to indicate whether a lead inspection certificate had been obtained.

On September 21, 2012, the Department sent a letter to Mr. Ariosa informing him that he had failed to renew the Property's registration. The Department informed Mr. Ariosa of the inspection and certification requirements of the Act, and also indicated that Mr. Ariosa's failure to register the Property could result in administrative penalties.

On June 26, 2013, the Department sent a letter to Mr. Ariosa informing him that he had failed to renew the Property's registration for the years 2006, 2007, 2009, 2010, 2011, 2012, and 2013. That letter again informed Mr. Ariosa of the requirements of the Act and the potential for administrative penalties.

On July 9, 2013, Mr. Ariosa submitted the registration fees for the Property, which totaled $135.00, for the years 2006 through 2013. In 2014 and 2015, he renewed theProperty's registration with the Department. He did not renew the registration for the year 2016.

On December 15, 2017, Mr. Ariosa renewed the Property's registration. In so doing, Mr. Ariosa reported that the current tenant had moved into the Property on May 10, 2006, and that the most recent lead certification for the Property was April 11, 2008.

On June 19, 2018, the Department issued to Mr. Ariosa an Administrative Complaint, Order and Penalty. In that complaint, the Department alleged that, during the period from December 31, 2006 through April 7, 2017, Mr. Ariosa had violated the Act by failing to bring the Property into compliance with the Act's full risk-reduction standard and by failing to obtain a full risk-reduction certificate for the Property. The Department also alleged that a Person at Risk had been residing at the Property and that Mr. Ariosa had failed to satisfy the risk-reduction standards of the Act for Persons at Risk. Based on those alleged violations, the Department assessed an administrative penalty of $35,000.00 against Mr. Ariosa.

On September 27, 2018, Mr. Ariosa obtained a "full risk-reduction certificate" for the Property. On December 11, 2018, the Department issued an Amended Administrative Complaint, Order and Penalty, in which the Department acknowledged that Mr. Ariosa had obtained the full risk-reduction certificate but reiterated that Mr. Ariosa had failed to obtain such a certificate prior to September 27, 2018. The Department reasserted the allegations contained in its previous complaint and again assessed an administrative penalty of $35,000.00 against Mr. Ariosa.

Motion for Summary Decision

Shortly after filing its Amended Complaint, the Department filed a Motion for Summary Decision asking the OAH to make findings as to Mr. Ariosa's liability and the reasonableness of the penalty. Although Mr. Ariosa opposed the Department's motion, he did not dispute the Department's allegations that he had failed to comply with the applicable law. He disputed, rather, the reasonableness of the Department's penalty.

The presiding ALJ ultimately granted the Department's motion as to Mr. Ariosa's liability, finding that there was no dispute that Mr. Ariosa had violated the Act. The ALJ found that Mr. Ariosa "readily admits he failed to comply with the applicable law." But, because there was a dispute as to the amount of the proposed fine, the ALJ determined that a contested hearing on the merits of the administrative penalty was appropriate.

Contested Hearing

At that hearing, Maximillian Jeremenko, an Environmental Compliance Specialist with the Department, testified that an investigation of Mr. Ariosa was initiated after the Department received a "tenant outreach" survey stating that the Property was occupied and that the tenant had been living there for approximately 11 years. Mr. Jeremenko stated that he then checked the Department's "lead certificate database" and discovered that there were no certificates on file for the Property. A letter of non-compliance was sent to Mr. Ariosa.

Mr. Jeremenko testified that, on April 26, 2018, he went to the Property and interviewed the tenant. During the interview, the tenant informed Mr. Jeremenko that hehad moved to the Property 12 years ago and that a two-year-old child was living at the Property. Contemporaneously with that interview, Mr. Jeremenko completed a "Compliance Interview" form, on which he indicated that a two-year-old child was "residing or spending significant amounts of time at the Property." Mr. Jeremenko testified that, after confirming that there was no lead certificate for the Property, he "proceeded to push the case forward for a possible enforcement action."

Christopher DenBleyker, an Environmental Compliance Specialist Supervisor with the Department, testified that he was responsible for making the penalty recommendation in Mr. Ariosa's case. Mr. DenBleyker testified that, in making that recommendation, he reviewed the "eight penalty factors" and determined that "there were four that were applicable for this case." He explained that he then compared those penalty factors with information from the inspector and the rental registry database "to determine if the property is in compliance or out of compliance for the registration." Mr. DenBleyker noted the following factors as being of particular importance in his recommendation of a $35,000.00 penalty: that there was an "at-risk child" at the Property; that Mr. Ariosa had not obtained a lead certificate for the Property despite the tenant having lived there for 12 years; and that Mr. Ariosa had been sent "numerous letters" regarding his non-compliance.

Mr. DenBleyker testified that there were several factors that were not applicable in Mr. Ariosa's case. He explained that he determined two of the factors - the actual harm to the environment or human health and the nature and degree of injury to or interference with general welfare, health, and property - to be inapplicable because there had not been anyinjury to person or property. He explained that a third factor - the degree of hazard posed - did not impact his recommendation...