Clean Wis., Inc. v. Wis. Dep't of Natural Res.

961 N.W.2d 611

2021 WI 72

CLEAN WISCONSIN, INC. and Pleasant Lake Management District, Petitioners-Respondents,

v.WISCONSIN DEPARTMENT OF NATURAL RESOURCES, Respondent-Appellant,Wisconsin Manufacturers & Commerce, Dairy Business Association, Midwest Food Processors Association, Wisconsin Potato & Vegetable Growers Association, Wisconsin Cheese Makers Association, Wisconsin Farm Bureau Federation, Wisconsin Paper Council and Wisconsin Corn Growers Association, Intervenors-Co-Appellants,Wisconsin Legislature, Intervenor.

No. 2018AP59

Supreme Court of Wisconsin.

Oral Argument: April 12, 2021

Opinion Filed: July 8, 2021

For the intervenor, there were briefs filed by Eric M. McLeod, Kirsten A. Atanasoff, Lisa M. Lawless, and Husch Blackwell LLP, Madison and Milwaukee. There was an oral argument by Eric M. McLeod.

For the intervenors-co-appellants, there were briefs file by Robert I. Fassbender and Great Lakes Legal Foundation, Madison. There was an oral argument by Robert I. Fassbender.

For the petitioners-respondents, there was a brief file by Carl A. Sinderbrand and Axley Brynelson, LLP, Madison. There was an oral argument by Carl Sinderbrand.

For the respondent-appellant, there was a brief filed by Gabe Johnson-Karp and Jennifer L. Vandermeuse assistant attorneys general; with whom on the brief was Joshua L. Kaul, attorney general, Madison. There was an oral argument by Gabe Johnson-Karp.

An amicus curiae brief was filed on behalf of Central Sands Water Action Coalition by Andrea Gelatt, Rob Lundberg, Adam Voskuil, and Midwest Environmental Advocates, Madison.

An amicus curiae brief was filed on behalf of Wisconsin Trout Unlimited, Inc. by Henry E. Koltz and Schmidt, Darling & Erwin, Milwaukee.

DALLET, J., delivered the majority opinion of the Court, in which ZIEGLER, C.J., ANN WALSH BRADLEY, and KAROFSKY, JJ., joined. REBECCA GRASSL BRADLEY, J., filed a dissenting opinion, in which ROGGENSACK, J., joined.

REBECCA FRANK DALLET, J.

¶1 One of the Department of Natural Resources’ (DNR) many responsibilities is to evaluate applications to operate high capacity groundwater wells. For certain wells, the DNR must follow a specific environmental review process before approving the application. For all other wells, that process is not required, although the DNR sometimes still considers the potential environmental effects of a proposed well when evaluating the well's application. The eight well applications at issue here fall into the latter category: a formal environmental review was not required, but the DNR had information that the wells would negatively impact the environment. Despite that knowledge, the DNR approved the applications after concluding it had no authority to consider the proposed wells’ environmental effects.

¶2 Clean Wisconsin, Inc. and the Pleasant Lake Management District (collectively, "Clean Wisconsin") appealed that decision to the circuit court.¹ They argued that the DNR's decision was contrary to Lake Beulah Management District v. DNR, 2011 WI 54, 335 Wis. 2d 47, 799 N.W.2d 73, where we held that the DNR had the authority and discretion to consider the environmental effects of all proposed high capacity wells. The DNR argued that Lake Beulah is no longer good law because Wis. Stat. § 227.10(2m) (2019-20)² —enacted at roughly the same time we decided Lake Beulah—limits an agency's actions to only those "explicitly required or explicitly permitted by statute or by a rule," and, for these wells, a formal environmental review was not required under Wis. Stat. § 281.34.³ Thus, the question presented is whether § 227.10(2m) commands a different conclusion here than in Lake Beulah. The circuit court decided that it does not and we agree. We hold that the DNR erroneously interpreted the law when it concluded it had no authority to consider the environmental effects of the eight wells at issue here. Accordingly, we affirm the circuit court's order with the modification that the circuit court remand to the DNR all eight well applications.

I

¶3 Consolidated in this case are eight permit applications for high capacity wells, all of which were filed between March 2014 and April 2015.⁴ At the time, and consistent with our holding in Lake Beulah, the DNR's common practice was to review environmental-impact information for most high capacity well applications, regardless of whether Wis. Stat. § 281.34(4)(a) required such a review. If the review revealed that the proposed well would cause adverse environmental effects, the DNR would either deny the application or place it "on hold," neither denying nor approving it. For all eight wells at issue here, the DNR flagged the applications for further review of their potential environmental impacts. For seven of the wells,⁵ it completed that review and determined that approving the well would adversely affect waters covered by the public trust doctrine.⁶ The DNR then placed all eight well applications on hold.

¶4 While those applications were on hold, the DNR's well-approval process changed. In 2016, then-Attorney General Brad Schimel released an opinion regarding Wis. Stat. § 227.10(2m) and its effect on both the DNR's well-permit authority and our holding in Lake Beulah. The Attorney General's opinion concluded that this court did not address § 227.10(2m) in Lake Beulah and that, after the enactment of § 227.10(2m), the DNR had no authority to impose specific permit conditions that were not explicitly listed in a relevant statute. See Opinion of Wis. Att'y Gen. to Robin Vos, Assembly Committee on Organization Chairperson, OAG-01-16, ¶2 (May 10, 2016). He read Lake Beulah as holding that the legislature had "impliedly delegated" to the DNR broad, public-trust authority, which could not withstand § 227.10(2m) :

Although the Lake Beulah Court found that DNR had broad implied authority to impose permit conditions, 335 Wis. 2d 47, ¶3 [799 N.W.2d 73], that holding now directly conflicts with Act 21. I conclude that through Wis. Stat. §§ 227.10(2m) [and 227].11(2)(a), the Legislature has limited DNR's authority to regulate high capacity wells only as explicitly enumerated through statute or rule. DNR cannot premise such authority on broad statements of policy or general duty, such as those found in Wis. Stat. §§ 281.11 -.12.

OAG-01-16, ¶31 (footnote omitted). The DNR adopted this opinion and began approving most of the applications it had placed on hold. And, despite its having evidence that some of those proposed wells would adversely affect public-trust waters, the DNR generally imposed no permit conditions to protect those waters. The DNR also stopped reviewing the potential environmental effects of proposed wells except when such a review was required under Wis. Stat. § 281.34(4). Under this new approach, and despite its prior determination that the wells at issue here would adversely affect public-trust waters, the DNR approved all eight well applications without any conditions.

¶5 Clean Wisconsin appealed each approval to the circuit court under Wis. Stat. ch. 227. Clean Wisconsin argued that the DNR approved those wells based upon an erroneous legal determination that it had no authority outside of Wis. Stat. § 281.34(4) to consider the environmental effects of a proposed high capacity well. Citing Lake Beulah for support, Clean Wisconsin argued that the DNR has both a public-trust duty and the express statutory authority to consider the environmental impact of all proposed high-capacity wells. The DNR countered that Lake Beulah did not control for two reasons: (1) it was "decided incorrectly" because it "amalgamat[ed]" an "implied" authority for the DNR to review a proposed well's environmental effects rather than looking to the statutes’ explicit text; and (2) per the Attorney General's 2016 opinion, Wis. Stat. § 227.10(2m) negated Lake Beulah’s holding. Several business associations intervened and urged the circuit court to find that the DNR had properly approved the well applications.⁷ These associations argued that ruling otherwise would create a permit system without standards and leave applicants without clear guidance about which applications would be further reviewed for their potential environmental impact.

¶6 The circuit court agreed with Clean Wisconsin that Lake Beulah applied and that the DNR erred in determining it could not consider the environmental effects of all proposed high capacity wells. The circuit court pointed to a footnote in Lake Beulah in which we briefly mentioned that Wis. Stat. § 227.10(2m) did not affect our analysis. It then explained that the DNR, the business associations, and the Attorney General's opinion raised arguments that we had rejected in Lake Beulah. Having concluded that the DNR was bound by Lake Beulah, the circuit court found that "[a]bsent the Attorney General[’s] opinion, the DNR would have denied all ... of these well applications [except for the Turzinski application] as impacting navigable waters." It therefore vacated the seven approved applications and remanded to the DNR the Turzinski application so that the DNR could consider the well's potential effect on the headwaters of a nearby creek.

¶7 The DNR and the business associations appealed, and, in early 2019, the court of appeals certified the appeal to this court.⁸ After we accepted certification, two noteworthy procedural developments occurred. First, we granted the legislature's motion to intervene, creating two sets of intervenors: the business associations and the legislature. Throughout this opinion, we refer to them collectively as the "Intervenors." Second, the DNR now agrees with the circuit court and Clean Wisconsin that the DNR has the authority to review the environmental impact of a proposed well even if such a review is not required by Wis. Stat. § 281.34(4).

II

¶8 This certified appeal presents two questions:

(1) Does Wis. Stat. § 227.10(2m) prohibit the DNR from considering the potential environmental effects of a proposed high capacity well

...