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What Happens When the Agency Changes Its Mind? Recent Wisconsin Decision Highlights This Issue

Updated: Jul 1, 2020

Cows in a dairy farm (Photo by Edwin Remsberg).

This post is not legal advice

Sometimes I post about court decisions from other states that have little to do with Maryland but help demonstrate important features of law or tips to help you in your business. Today is one of those posts, involving a Wisconsin dairy seeking to expand its operation. In expanding, the dairy sought to get the state department of natural resources (DNR) to reissue its pollution discharge permit. When notice on the permit reissue was put out for public comment, five individuals contested the reissue, prompting an administrative hearing. At the end of the hearing, the administrative law judge issued a ruling requiring the reissued permit be modified by requiring monitoring groundwater and limiting the number of animal units in the dairy due to past issues with inadequate manure storage.

This was all in late 2014, and DNR was still working on implementing the new permit conditions in 2015, when someone at DNR asked the Wisconsin Attorney General to determine if state law limited DNR’s ability to place additional restrictions on the dairy. The state law in question limits agencies from requiring a condition in a permit unless explicitly allowed by statute or a regulation. The Attorney General decided the new conditions were not explicitly allowed by statute or regulation and would violate the law. With this in mind, the DNR Secretary reversed the administrative decision. That decision was challenged in court.

Court Opinion

On appeal, the court looked to decide whether DNR had followed the appropriate procedures in reversing its decision, determining that, in fact, DNR had not followed any of the processes in Wisconsin’s Administrative Procedures Act and could no longer change the decision and was beyond the authority of the Secretary of DNR.

DNR had decided to reverse the decision based on an interpretation of state law which did not allow the agency to add permit conditions or other restrictions unless state law allowed them. The court found the permit conditions (cap on animal units and requiring groundwater monitoring) allowed by the law. The Wisconsin legislature had expressly given DNR broad authority to protect the state’s waters and DNR could limit the number of animal units allowed and require groundwater monitoring. The court reversed the DNR decision.

Why Care?

Red barn (Photo by Edwin Remsberg).

The first thing to note is this is a district court opinion and the parties may decide to appeal, so the outcome may change down the road. Why should you care about a district court opinion out of Wisconsin? When agencies (such as Maryland Department of Agriculture or Maryland Department of the Environment) make a decision, in many cases the agencies must follow the state’s Administrative Procedures Act, which dictates how agencies make a decision after following a required process. Even when the agency appears to have made a mistake in applying a law, the agency will need to follow the process when reversing the decision.

The party impacted by the ruling (in this case, the dairy farmer) can also seek court review of an agency’s decisions. Once DNR had set the animal unit cap and determined the groundwater monitoring issue, the dairy farmer could seek court review of that final decision. We typically require final decisions before judicial review because until the agency’s decision is final, the agency can always change course. For example, if DNR had told the dairy farmer the animal unit cap would be 200 units, but had not issued the final permit, the dairy farmer could not challenge that decision in court until the final permit was issued. Allowing for court review of final agency decisions helps ensure agencies stay within the bounds of the law.

Keep all this in mind as you deal with government agencies. There is a process the agency must follow and limits on conditions and requirements the agency can place on you. If all else fails, you can always seek review in court once the agency’s decision is final.

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