For the past year, at the direction of Governor Shumlin and with the support of the General Assembly, the Natural Resources Board (NRB) and the Agency of Natural Resources (ANR) have been engaged in reviewing the state and municipal environmental permitting processes in Vermont and developing suggestions for improving these processes. The review has included focus group meetings and public meetings to elicit feedback regarding the strengths and weaknesses of the current permit systems, as well as ideas for changes that could improve the permit systems. The Natural Resource Board’s website has devoted a page to this process, which includes a list of the focus group and public meetings held and links to comments received. Recently, as a culmination of this initial review and public outreach effort, the NRB and ANR issued a joint report to the General Assembly.

The legislative report shows that the NRB and ANR examined several distinct areas of environmental permitting in Vermont: state Act 250 permits, which are administered by the NRB; state air, water, waste, and other permits that are administered by ANR; and municipal land use permits, which are regulated and administered by individual towns and cities with minimal state statutory guidance. These various permit processes are quite different in terms of the initial permit application and review processes, but they follow a common path on appeal, which is to undergo de novo review at the Vermont Superior Court, Environmental Division (Environmental Court). (Appeals of land use or zoning permits are on-the-record appeals only in those municipalities that have adopted the municipal administrative procedures act and follow a development review board process. According to the report, only ten municipalities have done so.) The report identifies the appeal process as a main area of focus because, although there is a relatively low percentage of appeals, the appeal process is seen as taking the greatest amount of resources—including time—for permit applicants, permit opponents, and the state.

The report explores two possible approaches to improving the appeal process, but stops short of specifically recommending either of the two approaches as the best way forward. The changes contemplated are either (1) adjusting the current Environmental Court process, or (2) creating a new quasi-judicial environmental review board. While the report avoids making any explicit statements to this effect, the role and duties that the environmental review board is contemplated to undertake would make it possible to dismantle both the Environmental Court and the NRB itself.

According to the report, public comments and focus group feedback indicate that the current Environmental Court process and proceedings are difficult to navigate for parties who are not represented by legal counsel, and that it takes too long to receive a final decision from the court. To address these issues, the first proposed solution would make certain changes to the current framework of the Environmental Court, including:

• addition of hearing officers or magistrates to assist the two Environmental Court judges

•  limitations on the scope or extent of discovery

• encouraging the use of prefiled testimony and exhibits instead of relying entirely on live hearings for the submission of evidence

•  creation of a public advocate to serve two possible roles: (1) represent the public interest in environmental matters, similar to the role of the Department of Public Service in utility matters; (2) serve as a low-cost or no-cost provider of legal assistance for unrepresented parties, similar to Legal Aid

• use Alternative Dispute Resolution (ADR) more effectively by having a case manager, hearing officer, or judge evaluate cases and decide when ADR is likely to assist in settling matters; using other forms of ADR aside from mediation

The second proposed approach would scrap the Environmental Court entirely, and replace that system with a new permit appeal process before a professional review board (Board). As described in the legislative report, the Board would be similar to the Public Service Board, which regulates Vermont’s utilities and energy producers. The report describes the Board as a three-member panel with two alternate members, all of whom would be selected through a process like that used for Public Service Board members or Superior Court judges, with appointment by the governor and confirmation by the Senate. As with the Public Service Board, the Board members would serve fixed terms with staggered term periods to provide a balance between continuity and new appointments. The report proposes that the Board would have essentially the same appellate jurisdiction as the Environmental Court, original jurisdiction over enforcement matters, and an additional role in that the Board would have original jurisdiction over the initial permit review for complex projects of great public interest. However, instead of operating like the Environmental Court, the report recommends that the Board operate in a manner similar to the Act 250 District Commissions in terms of the discovery process, use of prefiled testimony, and the administration of hearings. The report states that the District Commissions were widely recognized as effective venues for environmental decisions and were accessible to the public and unrepresented parties.

Because the Board’s jurisdiction would encompass all areas that the Environmental Court currently covers, and would have even broader original jurisdiction over some initial permit proceedings, there would no longer be a role for a separate Environmental Court. The report also states that the Board could take over the rulemaking and support duties that the Land Use Panel of the NRB currently performs for Act 250 matters. Further, the report recommends moving the rulemaking responsibilities of the NRB’s Water Resources Board to ANR. Based on these recommendations, it seems that creation of the Board would also allow for dissolution of the NRB, as all of its current roles and responsibilities would be transferred to the Board and ANR.

One further major change to the permit appeal process, which the report indicates could be implemented in either the Environmental Court or the Board model, is to change from a de novo review standard to an on-the-record review standard in more of the appeals. The Act 250 permit process seems largely equipped to handle this change at the present time giventhe manner in which the District Commissions currently operate. However, ANR would have to make substantial changes to its permit application review and approval procedures in order to allow for record review of its permit decisions. Similarly, most municipalities would need to adopt uniform administrative procedures, such as the Municipal Administrative Procedures Act, to ensure that their decisionmakers were fully trained and well-advised in proper procedural rules and to ensure that a proper record is created in order to allow for record review of their land use decisions.

In addition to these possible changes to the permit appeal processes, several other changes to the environmental permitting framework are discussed in the report. These include, as indicated above, transferring the water quality rulemaking responsibility from the NRB’s Water Resources Panel to ANR. Other ideas discussed include giving greater weight to ANR-issued permits and municipal permits in satisfying Act 250 criteria; increasing the use of professional certification to satisfy the applicant’s burden for ANR permits; increasing the use of on-line forms and permit application submissions for ANR permits; increasing the scope of public notice of ANR permit applications and draft permits; standardizing the notice and comment periods across all ANR permits; and increasing public participation in the ANR permit process prior to the time that ANR issues a draft permit.

Most of the possible changes described above would require legislative action, so readers interested in these issues should watch the current session for more developments. Governor Shumlin specifically requested the General Assembly to take action to implement “on the record” review for Act 250 appeals in his recent budget address —indicating a priority for action on that item.

The NRB is accepting comments on the legislative report through its web page dedicated to this project.

In a Jurisdictional Opinion issued earlier this year, the Vermont Environmental Court made clear that Act 250 applicants do not have the independent authority to determine which criteria might not apply to their permit application.

The case – In re Jurisdictional Opinion # 6-007: Wright Parcel Act 250 Subdivision, McBride Parcel Act 250 Subdivision Docket Nos. 55-4-10 Vtec & 56-4-10 Vtec (Feb. 23, 2011) – involved an appeal by Act 250 applicants regarding whether their Act 250 subdivision applications were complete.  Although the appeal has no bearing on any of the substantive Act 250 criteria, the decision is useful to any Act 250 applicant in that it spells out some of the basic requirements for ensuring that an application is complete when filed with the District Commission.

The issue in this case was whether the District #6 District Coordinator erred in rejecting the Act 250 applications as incomplete where the applicants had stated, under several criteria, that the criteria were “not applicable” because the subdivision would not affect the resources or characteristics protected by the criteria.  The Environmental Court ruled that it is the District Commission’s role to determine which criteria are applicable to any given permit application, and it is the applicant’s responsibility to provide the commissioners with sufficient information for them to make the determination.  Thus, the District Coordinator correctly rejected the applications as incomplete.

In this case, the applicants were proposing to subdivide two parcels of land into three lots per parcel.  The District Coordinator ruled that the applications were incomplete because under Criterion 9(B) (the primary agricultural soils criterion), the applications stated, “Criterion 9(B) does not apply to this application as no impact to any soils, primary agricultural or not, will occur due to the subdivision or sale by auction as no earth disturbance or construction of any kind is proposed as part of this application.”  After submitting these applications, the applicants later provided additional information about the agricultural soils on the parcels, including maps and a letter from the Department of Agriculture.  Additionally, the applicants also obtained state wastewater and potable water supply permits for each of the proposed subdivisions.  These permits were sent to the District Coordinator, and after receiving them, the District Coordinator believed that the Act 250 applications were intended to request approval for construction of houses, not simply for subdivision of the parcels.  The District Coordinator then requested additional information from the applicants.  The applicants met with the District Coordinator to discuss some of these issues and explain that they were seeking permits solely for subdivision, and that they were not planning to construct any houses themselves.  They also discussed the possibility of the District Coordinator reconsidering the decision that the applications were incomplete and the request for additional information; however, instead of formally requesting that the District Coordinator reconsider, the applicants appealed the decisions to the Environmental Court.

In its decision, the standard that the Environmental Court used was whether the applications provided “enough information about the property and its resources and characteristics to allow the District Commission to determine whether resources on the land must be assessed or analyzed under the Act 250 criteria for the project property as a whole, before the boundary lines are approved for the subdivision.”  The Court stated that, to decide the case, it was “necessary to determine which Act 250 criteria could potentially be affected by the proposed drawing of lot lines and sale of the lots separate from one another, without regard to what those lots might be used for by their purchasers.”  Because the Environmental Court has de novo authority in Act 250 appeals, it looked not only at the information provided to the District Coordinator at the time it decided that the applications were incomplete, but also at the information provided to the Court during the appeal.

Based on the information provided, the Court evaluated the Act 250 applications and determined that the applications were deficient under multiple criteria, including stormwater, floodways, wildlife and endangered species, primary agricultural soils, and earth resources.  Thus, the applicants were required to provide the additional information before their Act 250 applications would be reviewed by the District Commission.  The take-home message from this case for Act 250 applicants is to provide all of the information requested in the Act 250 application, and leave it to the District Commission to determine whether the criteria apply to the project or not.