Container Life Cycle Management, LLC v. DNR

COURT OF APPEALS
DECISION NOTICE
DATED AND FILED This opinion is subject to further editing. If
published, the official version will appear in
the bound volume of the Official Reports.
March 30, 2021
A party may file with the Supreme Court a
Sheila T. Reiff petition to review an adverse decision by the
Clerk of Court of Appeals Court of Appeals. See WIS. STAT. § 808.10
and RULE 809.62.

Appeal No. 2019AP1007 Cir. Ct. No. 2019CV313

STATE OF WISCONSIN IN COURT OF APPEALS
DISTRICT I

CONTAINER LIFE CYCLE MANAGEMENT, LLC,

PETITIONER-APPELLANT,

V.

WISCONSIN DEPARTMENT OF NATURAL RESOURCES,

RESPONDENT-RESPONDENT.

APPEAL from an order of the circuit court for Milwaukee County:
STEPHANIE ROTHSTEIN, Judge. Affirm.

Before Brash, P.J., Dugan and Donald, JJ.

Per curiam opinions may not be cited in any court of this state as precedent

or authority, except for the limited purposes specified in WIS. STAT. RULE 809.23(3).
No. 2019AP1007

¶1 PER CURIAM. Container Life Cycle Management, LLC (CLCM)
appeals the order of the circuit court dismissing its petition for judicial review of
two letters issued by the Wisconsin Department of Natural Resources (DNR) in
December 2018. We affirm the circuit court’s order dismissing CLCM’s petition
because the letters are not final agency decisions subject to judicial review.

BACKGROUND

¶2 CLCM is in the chemical-container refurbishment business. The
company operates a facility in St. Francis, Wisconsin, where it receives and cleans
used industrial containers such as steel and plastic drums. CLCM’s facility in
St. Francis is a source of air emissions subject to regulation by the DNR. This
case relates to CLCM’s requests for new air permits at its St. Francis facility.

¶3 This case involves air pollution permitting requirements under the
Clean Air Act, 42 U.S.C. § 7401 et seq.; Wisconsin’s analogous air pollution
statutes, WIS. STAT. ch. 285 (2019-20);1 and the applicable regulations, namely
WIS. ADMIN. CODE chs. NR 405 and 406. These statutes and regulations relate to
controlling emissions of air contaminants from stationary sources.

¶4 There are two main categories of sources regulated under these
statutes and regulations: (1) major sources, which emit more air contaminants
than the law permits; and (2) minor sources, which emit less emissions than the
law permits. See WIS. STAT. § 285.01(24), (25). A synthetic minor source is a
source that could emit enough air contaminants to qualify as a major source, but

1
All references to the Wisconsin Statutes are to the 2019-20 version unless otherwise
noted.

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accepts permit limitations that bind its emissions below the major source level.
See WIS. ADMIN. CODE § NR 407.02(9). Generally speaking, construction of new
emissions sources or modification to existing sources require a construction
permit. See WIS. STAT. § 285.60(1)(a)1.; see also WIS. ADMIN. CODE § NR
406.03(1). For areas of the country in which air quality is relatively good, the
applicable permitting framework focuses on the “prevention of significant
deterioration” of air quality, or “PSD.” See generally WIS. ADMIN. CODE ch. NR
405.

¶5 In 2017, the DNR and the United States Environmental Protection
Agency notified CLCM of a violation of its air emissions permit due to odors and
the emission of volatile organic compounds from CLCM’s facility in St. Francis.
CLCM submitted a permit application on February 14, 2018, to install a TRITON-
60.95 Regenerative Thermal Oxidizer (Thermal Oxidizer) that would control the
odors and the emission of the volatile organic compounds. The DNR advised
CLCM that it needed to submit additional information to complete its application,
and CLCM submitted a revised Thermal Oxidizer permit application on June 7,
2018, with additions to the application including the installation of a new
emissions source, removal of existing equipment, and a request to revise existing
permit emission limits.

¶6 In a letter dated June 26, 2018, the DNR denied a waiver to CLCM
to begin construction on one of the additional projects included in the revised
Thermal Oxidizer application because the DNR “determined that … the facility is
a PSD major source” and the DNR “may not grant a waiver” for such sources. In
the following paragraph, the DNR addressed the Thermal Oxidizer application and
stated that it “reviewed the revised application and finds the application as
submitted to be incomplete.” The DNR then listed several items needed from

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CLCM to complete the Thermal Oxidizer application, now that the facility was
considered a PSD major source. The letter concludes with a section entitled
“Notice of Appeal Rights,” which states: “If you believe that you have a right to
challenge this construction waiver decision, you should know that Wisconsin
statutes establish time periods within which requests to review Department
decisions must be filed.”

¶7 Following the June letter, CLCM submitted additional information
to the DNR contesting the PSD major source designation, but CLCM never sought
judicial review. Further discussions between CLCM and the DNR about the PSD
major source designation ended with the DNR issuing two letters to CLCM in
December 2018.

¶8 The first letter, dated December 14, 2018, stated that the DNR
“continues to find the application … incomplete” and “once more requests” that
CLCM submit the information requested in the June letter. Immediately following
its request for information, the DNR stated, “In a letter dated June 26, 2018, the
department informed CLCM that the St. Francis facility required an after-the-fact
PSD permit to address VOC and HAP emissions not previously disclosed to the
department[.]” The DNR continued by describing why it considers the facility to
be a PSD major source and why this designation remains unchanged from the time
of the June letter. In the last section of the letter, entitled “Request for Additional
Information,” the DNR “requests again” the information that it still needs from
CLCM to resolve its Thermal Oxidizer application in light of the PSD major
source designation. In concluding, the DNR stated, “Please be advised that this is
not a complete review of the [Thermal Oxidizer] construction permit application
or the operation permit application submitted at the same time[.]”

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¶9 CLCM requested another meeting with the DNR after receiving the
December 14 letter and the DNR, believing another meeting would be fruitless,
responded with a letter dated December 26, 2018. In this letter, the DNR
reiterated its position:

With regards to the source status of the facility, the
department has consistently indicated since June of 2018
that there was reason to believe the facility should have
been permitted as a PSD major source since at least 2014.
In order to issue a permit containing all legally applicable
requirements at this point in time, the department again
asks CLCM to submit the information requested in both the
June and December letters. If CLCM disputes the
department’s exemption for the [Thermal Oxidizer] and
believes that a permit is necessary, the information
requested in the December 14 letter is necessary to keep the
permitting process moving forward.

Neither the December 14 letter, nor the December 26 letter contained a Notice of
Appeal Rights section, whereas the June letter did.

¶10 CLCM filed a petition for judicial review on January 11, 2019, and
sought review of the two December letters. In its petition, CLCM challenged the
two December letters as the DNR’s final decision to apply the PSD designation to
its facility.

¶11 The DNR filed a motion to dismiss the petition in which it argued, as
is relevant here, that the December letters were not final agency decisions subject
to judicial review and argued that the PSD designation was made in the June letter,
for which the time to file a petition for review had long since expired. The circuit
court granted the DNR’s motion to dismiss. CLCM filed a motion for
reconsideration. The circuit court denied CLCM’s motion, and this appeal
follows.

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DISCUSSION

¶12 On appeal, CLCM argues that the December 14 letter is subject to
judicial review and that the circuit court “made two errors in dismissing CLCM’s
petition for review as untimely in one respect and premature in another.” We
disagree. The December 14 letter, from which CLCM sought judicial review and
develops an argument on appeal, is not a final agency decision subject to judicial
review.2

¶13 Administrative decisions are subject to judicial review as provided
by WIS. STAT. § 227.52. “To receive review of an administrative decision, a
party’s ‘substantial interests’ must be ‘adversely affected.’” Kimberly Area Sch.
Dist. v. LIRC, 2005 WI App 262, ¶10, 288 Wis. 2d 542, 707 N.W.2d 872 (quoting
WIS. STAT. § 227.52). “If a decision sought to be reviewed is not an
administrative decision within the meaning of the statute, a circuit court lacks
jurisdiction to proceed on the merits and only has jurisdiction to dismiss the
petition for review.” Id. “Whether an administrative decision is subject to judicial
review is a question of law, which we review without deference.” Id., ¶9.

¶14 Preliminary and interlocutory agency decisions are “excluded from
judicial review to prevent administrative proceedings from being ‘constantly

2
CLCM raised the December 26 letter in its petition for review before the circuit court,
but it fails to develop an argument before this court regarding the December 26 letter. We do not
address arguments that are undeveloped, see State v. Pettit, 171 Wis. 2d 627, 646-47, 492
N.W.2d 633 (Ct. App. 1992), or abandoned on appeal, see A.O. Smith Corp. v. Allstate Ins. Cos.,
222 Wis. 2d 475, 491, 588 N.W.2d 285 (Ct. App. 1998). We affirm the circuit court’s decision to
dismiss the petition for judicial review as to the December 26 letter for these reasons, and
consequently, our discussion focuses on the December 14 letter. However, given that the
December 26 letter reiterates the DNR’s same position from the December 14 letter, the
December 26 letter suffers from the same defects and is not a final agency decision subject to
judicial review.

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interrupted and shifted back and forth between the agencies and the courts.’” Id.,
¶12 (citation omitted). “In determining whether an agency order is final for
purposes of judicial review, we focus on its substance and not its form or label.”
Sierra Club v. DNR, 2007 WI App 181, ¶14, 304 Wis. 2d 614, 736 N.W.2d 918.

¶15 Looking to the substance of the December 14 letter, we conclude
that CLCM has not sought review of a final agency decision, which is required in
order for the court to have jurisdiction. In the letter, the DNR expressly and
unambiguously states that the Thermal Oxidizer permit process is ongoing, and the
DNR reiterates an entire list of items that the DNR previously requested from
CLCM in June 2018 to even consider the Thermal Oxidizer application complete.
Consequently, the outcome of the Thermal Oxidizer permit application was left
undetermined in the December letter and items to even consider the application
complete were still being requested. With the application still pending, “the
substantial rights of the parties involved … remain undetermined.” See Kimberly
Area Sch. Dist., 288 Wis. 2d 542, ¶12 (citation omitted).

¶16 Additionally, the DNR did not include a Notice of Appeal rights
section in the letter. While this is not determinative, it is further evidence that the
DNR did not consider the letter to be a final decision of any sort that triggered
CLCM’s ability to seek judicial review.

¶17 In its petition for review and on appeal, CLCM argues for judicial
review of the December 14 letter as a final decision on the PSD major source
designation and argues that the cost and expense it will incur as a result of such a
designation requires immediate judicial review. CLCM contends that, pursuant to
federal case law, the PSD major source designation is immediately subject to
judicial review even if the permit process is ongoing.

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¶18 Even assuming for the sake of argument that a PSD major source
designation is immediately subject to judicial review, that designation was not
made in the December letter. Instead, the December letter references the PSD
major source designation made in the June letter in which the DNR clearly stated
that “[t]he department has determined that … the facility is a PSD major source”
and then lists several items for CLCM to submit to complete its Thermal Oxidizer
application as a result of the new PSD major source designation. In fact, the first
item on the list from the June letter requests “emission calculations for each
significant unit at the facility” because “the facility is a major PSD source.”

¶19 The December 14 letter does not make or modify the PSD major
source designation and its applicability to the Thermal Oxidizer application, but
rather reiterates the same designation from the June letter, along with the same list
of items. If there was a time to seek judicial review of the PSD major source
designation, it was when CLCM received the June letter for which judicial review
is no longer available. See WIS. STAT. § 227.53(1)(a) (providing thirty days to file
a petition for judicial review).

¶20 CLCM further argues that the PSD designation was not made until
the December 14 letter because the December 14 letter denied CLCM’s request to
permit the facility as a synthetic minor source and, thereby, avoid the PSD
permitting process. In the December 14 letter, the DNR stated, “DNR cautioned
CLCM that such a plan was complicated by the unresolved concerns over the PSD
status of the 2014 project. Upon further consideration, the department has
determined that such a permitting approach is not approvable in an after-the-fact
PSD situation.” Read in context, this language tables the minor synthetic source
permitting approach until the underlying violations in the original permit that led
to the PSD major source designation in the first place are resolved. This language

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does not transform the December 14 letter into a final agency decision subject to
judicial review.

CONCLUSION

¶21 In sum, we conclude that the letters for which CLCM sought judicial
review are not final agency decisions that are, in fact, subject to judicial review.
Thus, we affirm the circuit court’s order dismissing CLCM’s petition for judicial
review.

By the Court.—Order affirmed.

This opinion will not be published. See WIS. STAT. RULE
809.23(1)(b)5.

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