Sage v. Colo Dept of Pub Health

The summaries of the Colorado Court of Appeals published opinions
constitute no part of the opinion of the division but have been prepared by
the division for the convenience of the reader. The summaries may not be
cited or relied upon as they are not the official language of the division.
Any discrepancy between the language in the summary and in the opinion
should be resolved in favor of the language in the opinion.

SUMMARY
August 20, 2020

2020COA127

No. 19CA0990, Peabody Sage v Colo Dept of Pub Health —
Administrative Law — Final Agency Action; Public Health &
Environment — Colorado Water Quality Control Act

A division of the court of appeals considers whether a “Final

Agency Order” issued by the Executive Director of the Colorado

Department of Public Health and Environment (the Department)

was the last step in the adjudicatory process, rendering the

groundwater-discharge permit of appellant, Peabody Sage Creek

Mining, LLC (Peabody), final. The division concludes that the order

was a final agency action; therefore, the time to seek judicial review

of the action was governed by the Water Quality Control Act (the

Act), §§ 25-8-403, -404, C.R.S. 2019, rather than the State

Administrative Procedure Act, § 24-4-106(4), C.R.S. 2019. Because

the Act required Peabody to seek judicial review within thirty days
of the Department’s final order, and Peabody sought review thirty-

five days later, the division affirms the trial court’s dismissal of

Peabody’s complaint seeking judicial review of the final agency

action. However, the division remands for the trial court to correct

its judgment to a dismissal without prejudice.
COLORADO COURT OF APPEALS 2020COA127

Court of Appeals No. 19CA0990
Routt County District Court No. 19CV30029
Honorable Shelley A. Hill, Judge

Peabody Sage Creek Mining, LLC, a Colorado limited liability company,

Plaintiff-Appellant,

v.

Colorado Department of Public Health and Environment, Water Quality Control
Division; and Jill Hunsaker Ryan, in her official capacity as Executive Director
of the Colorado Department of Public Health and Environment,

Defendants-Appellees.

JUDGMENT AFFIRMED IN PART, REVERSED IN PART,
AND CASE REMANDED WITH DIRECTIONS

Division VII
Opinion by JUDGE FOX
Brown and Rothenberg*, JJ., concur

Announced August 20, 2020

Bryan Cave Leighton Paisner LLP, Alan J. Gilbert, Stephen D. Rynerson,
Denver, Colorado, for Plaintiff-Appellant

Philip J. Weiser, Attorney General, Carrie Noteboom, First Assistant Attorney
General, Matthew B. Miller, Assistant Attorney General, Denver, Colorado, for
Defendants-Appellees

*Sitting by assignment of the Chief Justice under provisions of Colo. Const. art.
VI, § 5(3), and § 24-51-1105, C.R.S. 2019.
¶1 In this appeal, we conclude that the “Final Agency Order”

issued by the Executive Director of the Colorado Department of

Public Health and Environment (the Department) was the last step

in the adjudicatory process making the groundwater-discharge

permit of appellant Peabody Sage Creek Mining, LLC (Peabody),

final. Therefore, the time to seek judicial review of the final

administrative action is governed by the operative provisions of the

Water Quality Control Act (the Act), §§ 25-8-403, -404, C.R.S. 2019,

rather than the State Administrative Procedure Act (APA), § 24-4-

106(4), C.R.S. 2019. Because the Act required Peabody to seek

judicial review within thirty days of the Department’s final order,

but Peabody sought review thirty-five days later, we affirm the trial

court’s dismissal of Peabody’s complaint seeking judicial review of a

final agency action. However, we reverse in part and remand for the

trial court to correct its judgment to a dismissal without prejudice.

I. Facts and Procedural History

¶2 Peabody owns an inactive mine in Hayden, Colorado. In

November 2015, the Colorado Water Quality Control Division (the

water division), an entity within the Department, renewed and

1
reissued a permit (the 2015 Permit) authorizing Peabody to

discharge water from that mine.

¶3 Dissatisfied with certain terms of the 2015 Permit, Peabody

sought reconsideration of the permit. The water division granted

that request, and the Department, through its Executive Director,

referred the matter to an administrative law judge (ALJ).

¶4 The ALJ conducted the hearing and issued an order entitled

“Initial Decision” that modified the 2015 Permit to include terms

mostly favorable to Peabody. The Initial Decision included a notice

to the parties of their right to appeal by filing exceptions with the

Department.

¶5 Both parties filed exceptions. The Executive Director then

heard the administrative appeal and reversed the ALJ’s Initial

Decision in an order entitled “Final Agency Order.” That order

concludes with the statement, “the 2015 Permit shall go into effect

immediately.”

¶6 Thirty-five days later, Peabody filed a complaint in the Routt

County District Court for judicial review of a final agency action.

Peabody invoked jurisdiction under APA section 24-4-106(4), which

provides that “any person adversely affected or aggrieved by any

2
agency action may commence an action for judicial review in the

district court within thirty-five days after such agency action

becomes effective.” (Emphasis added.) It conceded that venue was

governed by section 25-8-404.

¶7 The water division responded with a C.R.C.P. 12(b)(1) motion

to dismiss the complaint for lack of subject matter jurisdiction. It

contended that section 25-8-404(3) of the Act applied, which

provides that “[a]ny proceeding for judicial review of any final rule,

order, or determination of the commission or division shall be filed

within thirty days after said rule, order, or determination has

become final.” (Emphasis added.) The court reasoned that

although the Final Agency Order was authored by the Executive

Director, the order was essentially an act of “the division” within the

meaning of the Act.

¶8 Deeming the Final Agency Order to be an act of “the division,”

the district court concluded that the Act provided the exclusive

means for judicial review. It accordingly dismissed, with prejudice,

Peabody’s complaint as untimely. Peabody appeals.

II. Final Agency Action

A. Standard of Review

3
¶9 Where, as here, there are no disputed issues of material fact,

we review de novo a C.R.C.P. 12(b)(1) motion to dismiss for lack of

subject matter jurisdiction. Tulips Invs., LLC v. State ex rel. Suthers,

2015 CO 1, ¶ 11. A court’s jurisdiction to review an agency action

is a question of statutory interpretation that we also review de novo.

Doe 1 v. Colo. Dep’t of Pub. Health & Env’t, 2019 CO 92, ¶ 15.

¶ 10 In construing a statute, our primary purpose is to ascertain

and give effect to the intent of the General Assembly. Assoc. Gov’ts

of Nw. Colo. v. Colo. Pub. Utils. Comm’n, 2012 CO 28, ¶ 11. We look

first to the language of the statute, giving words and phrases their

plain and ordinary meaning. Chittenden v. Colo. Bd. of Soc. Work

Examr’s, 2012 COA 150, ¶ 11. In doing so, we consider the statute

as a whole and construe it in a manner that gives consistent,

harmonious, and sensible effect to all its parts. Id. at ¶ 12.

¶ 11 If the statute is unambiguous, our inquiry ends. Id. at ¶ 13.

But if the statute is ambiguous, we turn to other tools of statutory

construction to discern the General Assembly’s intent, including

legislative history, statements of legislative purpose, the statute’s

relationship to other statutory provisions, and policy

considerations. Id.

4
B. Regulatory Framework

1. The Colorado Water Quality Control Act

¶ 12 The Act empowers the Department, headed by the Executive

Director, to adopt and enforce regulations to prevent, abate, and

control water pollution in Colorado. §§ 25-1.5-203, 25-8-102(1),

25-8-301(1), C.R.S. 2019. It also mandates that “[n]o person shall

discharge any pollutant into any state water from a point source

without first having obtained a permit from the division for such

discharge.” § 25-8-501(1), C.R.S. 2019.

¶ 13 In furtherance of that objective, the Act creates a water quality

control commission within the Department and tasks it with

promulgating (among other rules) water quality standards and

permit regulations. § 25-8-201 to -202, C.R.S. 2019. It also gives

the Department’s enforcement responsibilities to the Division of

Administration, an entity within the Department that is further

divided into various subdivisions, including the water division.

§ 25-8-301(2) (“[I]n furtherance” of the Department’s responsibility

to enforce the regulations adopted by the commission, “the

executive director shall maintain within the division [of

administration] a separate water quality control agency.”); § 25-8-

5
302(1), C.R.S. 2019 (tasking “[t]he division” with administering the

permit system).

¶ 14 As noted, and as relevant to the challenge before us, section

25-8-404 provides as follows:

(2) Any proceeding for judicial review of any
final order or determination of the commission
or division shall be filed in the district court for
the district in which the pollution source
affected is located.

(3) Any proceeding for judicial review of any
final rule, order, or determination of the
commission or division shall be filed within
thirty days after said rule, order, or
determination has become final. . . .
Quasi-judicial determinations shall become
final upon issuance of such determinations to
those parties to the proceedings. The period
for filing the action for judicial review shall be
stayed while any application for a hearing,
rehearing, or reconsideration is pending
pursuant to section 25-8-403, and the period
during which any such application is pending
shall extend the time for filing a proceeding for
judicial review an equal length of time.

See also Dep’t of Pub. Health & Env’t Reg. 61.7, 5 Code Colo. Regs.

1002-61. Section 25-8-403, the reconsideration provision, states as

follows:

During the time permitted for seeking judicial
review of any final order or determination of
the commission or division, any party directly

6
affected by such order or determination may
apply to the commission or division, as
appropriate, for a hearing or rehearing with
respect to, or reconsideration of, such order or
determination. . . . If the application for a
hearing, rehearing, or reconsideration is
granted, the order or determination to which
such application pertains shall not be
considered final for purposes of judicial review,
and the commission or the division may affirm,
reverse, or modify, in whole or in part, the
pertinent order or determination; thereafter
such order or determination shall be final and
not subject to stay or reconsideration under
this section.

¶ 15 The Act expressly incorporates APA procedures into the

permitting process. § 25-8-401(1), C.R.S. 2019 (Hearings “shall be

held pursuant to and in conformity with” the APA.); Parrish v. Water

Quality Control Div., 934 P.2d 913, 914 (Colo. App. 1997);1 Dep’t of

Pub. Health & Env’t Reg. 21.4, 5 Code Colo. Regs. 1002-21;2 Dep’t

of Pub. Health & Env’t Reg. 61.7(b), 5 Code Colo. Regs. 1002-61.

2. The State Administrative Procedure Act

1 In addition, because the Department, Executive Director, the
division of administration, and the water division are agencies
having statewide territorial jurisdiction, the APA and the Act govern
their actions. § 24-4-107, C.R.S. 2019; Roosevelt Tunnel, LLC v.
Norton, 89 P.3d 427, 430 (Colo. App. 2003).
2 This regulation, which outlines the applicable adjudication

procedures, was added as part of the agency’s rulemaking process
and has been amended from time to time between 2007 and 2015.

7
¶ 16 Regarding judicial review, APA section 24-4-106(4) provides

that

any person adversely affected or aggrieved by
any agency action may commence an action
for judicial review in the district court within
thirty-five days after such agency action
becomes effective . . . . A proceeding for such
review may be brought against the agency by
its official title, individuals who comprise the
agency, or any person representing the agency
or acting on its behalf in the matter sought to
be reviewed. . . . The residence of a state
agency for the purposes of this subsection (4)
shall be deemed to be the city and county of
Denver. . . .

¶ 17 The APA operates as a gap filler where an organic statute like

the Act is silent on a matter of procedure. Marks v. Gessler, 2013

COA 115, ¶ 29. But, by its own terms, the APA is inapplicable to an

agency action if it is inconsistent with the organic statute

authorizing that action. § 24-4-107, C.R.S. 2019. While the “APA

and statutes specific to that agency should be read together and

harmonized to the extent possible[,] if a provision of the APA and

the agency’s statute conflict, the agency-specific provision controls.”

V Bar Ranch LLC v. Cotten, 233 P.3d 1200, 1205 (Colo. 2010).

C. Discussion

8
¶ 18 The parties dispute which timeline — the Act’s thirty-day

deadline or the APA’s thirty-five-day deadline — applies to

Peabody’s challenge to the Final Agency Order. More specifically,

they disagree on whether the Final Agency Order was a “final order

or determination of the . . . division” within the meaning of section

25-8-404(3) of the Act. As we explain below, we conclude that the

culmination of the administrative appeals process was the

Department’s January 17, 2019, Final Agency Order and that order

triggered the Act’s thirty-day judicial review deadline.

1. Review of “Final Agency Action”

¶ 19 Only a “final” agency action is subject to judicial review. § 24-

4-106(2); Doe 1, ¶ 38. We must therefore decide whether the Final

Agency Order, as a “final order or determination of the . . . division,”

constitutes “final” agency action here.

¶ 20 Neither the Act nor the APA defines the term “final,” but

generally a final agency action “must ‘(1) mark the consummation of

the agency’s decision-making process and not be merely tentative or

interlocutory in nature, and (2) constitute an action by which rights

9
or obligations have been determined or from which legal

consequences will flow.’”3 Doe 1, ¶ 38 (quoting Chittenden, ¶ 26).

¶ 21 The Act’s permitting process begins when a party files an

application for a new or renewal permit with “the division.” § 25-8-

502(2), C.R.S. 2019. Peabody applied for a renewal permit and the

water division granted that application and issued the 2015 Permit.

At this point, the 2015 Permit was a “final order or determination of

the . . . division.” § 25-8-404(2).

¶ 22 But Peabody chose to invoke section 25-8-403, the

reconsideration provision, and demanded a hearing from the water

division. The water division granted that request, at which point

the 2015 Permit was no longer final. § 25-8-403. The Department,

on the water division’s behalf, transferred the matter to the Office of

Administrative Courts so that an ALJ outside of the Department

3The operative rules clearly contemplate that the conclusion of the
administrative appeals process constitutes “Final Agency Action”
subject to judicial review. See Dep’t of Pub. Health & Env’t Reg.
21.4(K), 5 Code Colo. Regs. 1002-21 (titled “Final Agency Action”
and describing the process that was followed in this case). If
Peabody had not availed itself of the reconsideration process, the
water division’s decision on permitting would have then been final.
See § 25-8-404(3), C.R.S. 2019; see also Colo. Water Quality Control
Comm’n v. Town of Frederick, 641 P.2d 958, 965 (Colo. 1982).

10
could conduct the hearing. § 25-8-401(4); see also § 24-30-1001,

C.R.S. 2019; Butz v. Economou, 438 U.S. 478, 513-14 (1978) (In an

agency adjudication the hearing examiner must exercise

“independent judgment on the evidence before him, free from

pressures by the parties or other officials within the agency.”);

Edwin L. Felter, Jr., The Hidden Executive Branch Judiciary:

Colorado’s Central Panel Experience – Lessons for the Feds, 19 Colo.

Law. 1307, 1312 (July 1990) (describing Colorado’s central panel

structure, which gives ALJs independence from the agencies they

serve, and observing that state “legislatures are beginning to find

that the central panel is the best answer to providing dignified,

impartial, and cost-effective administrative adjudications”).

¶ 23 While the Act does not explain the water division’s role in the

reconsideration after this point, see § 25-8-401, the water division’s

regulations and the APA’s procedures help to fill in that gap, Marks,

¶ 29. Pursuant to APA section 24-4-105, C.R.S. 2019, and

consistent with the Department’s Regulation 21.4, an ALJ

conducted a hearing and issued an Initial Decision on September

17, 2017, before returning the matter to the Department. § 24-4-

105(14); Weld Air & Water v. Colo. Oil & Gas Conservation Comm’n,

11
2019 COA 86, ¶ 34 (after enacting regulations, the agency is bound

by them); Dep’t of Pub. Health & Env’t Reg. 21.4(K)(3), 5 Code Colo.

Regs. 1002-21 (noting that, absent “an appeal to the agency by

filing exceptions within thirty days after service of the initial

decision of the hearing officer upon the parties, unless extended by

the agency, or a review upon motion of the agency within thirty

days after service of the initial decision of a hearing officer, every

such initial decision of a hearing officer shall thereupon become the

decision of the agency”). The ALJ’s Initial Decision clearly notified

the parties that if no exceptions were filed within thirty days, that

decision would be final: “This decision is final unless exceptions are

filed within thirty (30) days from the date of this notice, pursuant to

§ 24-4-105(14)(a)(III). Exceptions must be filed with the Colorado

Department of Public Health and Environment. . . . Failure to file

exceptions as prescribed herein shall result in a waiver of judicial

review.”

¶ 24 The parties filed timely exceptions to that decision with the

Department. § 24-4-105(14)(b), (c). The Executive Director

reviewed the ALJ’s Initial Decision, modified the ALJ’s factual

findings, reversed in part his legal conclusions, and ordered that

12
the 2015 Permit be effective immediately. § 24-4-105(15), (16);

Dep’t of Pub. Health & Env’t Reg. 21.4(K), 5 Code Colo. Regs.

1002-21 (“Final Agency Action”).

¶ 25 That decision, titled Final Agency Order and dated January

17, 2019, was the last action taken in the administrative

proceedings before Peabody filed its complaint. Because Peabody’s

complaint recognizes this as the final agency action it seeks to have

reviewed, there is no credible dispute that the Final Agency Order

marked the end of the agency process.

¶ 26 The legal effect of the Final Agency Order was to conclude the

permitting process, to make the 2015 Permit’s terms and conditions

final for purposes of judicial review, and to begin the thirty-day

period to seek judicial review. § 25-8-403; § 25-8-404(3) (requiring

judicial review “within thirty days after said rule, order, or

determination has become final”) (emphasis added); Dep’t of Pub.

Health & Env’t Reg. 21.4(K), 5 Code Colo. Regs. 1002-21.

2. The Water Division’s Absence from the Final Administrative Step
Does Not Change Finality For Purposes of Judicial Review

¶ 27 Peabody first argues that the Department’s action is not an

undertaking of the water division because the Act defines “division”

13
to mean “the division of administration of the department of public

health and environment.” § 25-8-103(4), C.R.S. 2019. Likewise, it

defines “[e]xecutive director” to mean “the executive director of the

department of public health and environment.” § 25-8-103(7). But

both definitions are qualified by the phrase “unless the context

otherwise requires.” § 25-8-103. And here context and the

Department’s rules require otherwise. The Department, consistent

with the Act, the APA, and its own rules, acted for the water division

in the final step of the administrative appeal of the challenged

discharge permit. See § 24-4-105; § 25-8-403; § 25-8-404(3); Dep’t

of Pub. Health & Env’t Reg. 21.4(K), 5 Code Colo. Regs. 1002-21.

¶ 28 Peabody next argues that the APA differentiates between the

division of administration and the Executive Director. See § 24-4-

102(3), C.R.S. 2019 (“‘Agency’ means any . . . department,

institution, division, or officer of the state.”). It then reasons that

because the plain language of section 25-8-404 applies only to acts

of “the division” — i.e., the division of administration and the water

division — the Act’s judicial review provision is inapplicable to final

agency actions taken by the Executive Director. The water division,

however, points out that only “the division” can reconsider a permit

14
under the Act. § 25-8-403. It then reasons, “given that the Final

Agency Order issued to Peabody was the culmination of an

administrative appeal process requested and authorized under

[section 25-8-403], it was clearly an order ‘of the division.’” We

agree with the water division.

¶ 29 Like other state and federal agencies, the Department has

created a structure that allows an official who did not participate in

the original decision, here the permit renewal approval, to perform

the administrative review function.4 See Dep’t of Pub. Health &

Env’t Reg. 21.4, 5 Code Colo. Regs. 1002-21. It would be

4 Here, the Department referred the matter for a hearing before an
ALJ within the Office of Administrative Courts (OAC), § 24-30-1001,
C.R.S. 2019, but it could have designated “an employee of the
Department of Public Health and Environment or a member of, or
the Administrator of, the Commission” so long as the person
engaged in conducting a hearing or participating in a decision or an
initial decision is not “responsible to or subject to the supervision or
direction of any officer, employee, or agent engaged in the
performance of investigatory or prosecuting functions for the
agency.” Dep’t of Pub. Health & Env’t Reg. 21.4(I)(1), 5 Code Colo.
Regs. 1002-21. The regulations also expressly prohibit ex parte
contacts with the decision-maker while an adjudicatory proceeding
is pending. Dep’t of Pub. Health & Env’t Reg. 21.4(J)(13), 5 Code
Colo. Regs. 1002-21. Merely because some other agency (here,
OAC) participated in the process does not mean that the final
agency action is not an act of “the division” for judicial review
purposes.

15
inconsistent with the Department’s own regulations for the ALJ to

return his Initial Decision to the water division — rather than the

Department — when the water division issued the permit renewal

Peabody challenged. Review of the ALJ decision and the water

division’s decision by another arm of the Department, here its

Executive Director, makes sense because she did not personally

participate in renewing the permit and setting the permit’s

conditions. As such, she provided the best opportunity for a fresh

look at the ALJ’s findings of fact and conclusions of law.5

5 Review by another arm of the agency also fulfills the “separation of
functions” principle. That principle holds that agency staff
members who have prepared or presented evidence or argument on
behalf of or against a party to an administrative proceeding should
not participate in the decision. See Michael Asimow, When the
Curtain Falls: Separation of Functions in the Federal Administrative
Agencies, 81 Colum. L. Rev. 759 (1981). This principle is now
embodied in the Federal Administrative Procedure Act, 5 U.S.C.
§ 554(d) (2018), and recognized in some state statutes or
regulations. See Dep’t of Pub. Health & Env’t Reg. 21.4(I), (J), 5
Code Colo. Regs. 1002-21; see also Roosevelt Tunnel, LLC, 89 P.3d
at 429 (relying in part on federal cases in interpreting “final agency
action” under the APA); Andrews v. D.C. Police & Firefighters Ret. &
Relief Bd., 991 A.2d 763, 769 n.11 (D.C. 2010) (noting that because
the District of Columbia’s administrative procedures act is “closely
analogous to the requirements of the Federal Administrative
Procedure Act,” we “look to case law interpreting the federal APA for
guidance” in interpreting it); see 5 U.S.C. § 557(d) (2018)
(discussing ex parte contacts).

16
¶ 30 Relatedly, Peabody also contends that because the Act’s

reconsideration clause applies only to reconsideration by “the

division,” the Final Agency Order resulted from an “additional,”

“separate,” and “distinct” appeal authorized by section 24-4-105(15)

of the APA. We disagree.

¶ 31 The reconsideration clause is the exclusive means to secure

administrative review of a final permit. § 25-8-403; Assoc. Gov’ts of

Nw. Colo., ¶ 8 (“Where a statute provides a right of review of an

administrative decision, the statute is the exclusive means to secure

review.”). To the extent that Peabody reads the APA to create an

“additional” avenue to seek judicial review separate from section 25-

8-403, that construction conflicts with the Act and must be

rejected. § 24-4-107; Marks, ¶ 29. Peabody cites no legislative

history, statutory provision, or case law supporting the proposition

that a party may seek reconsideration of a permit under any other

provision of the Act except the reconsideration clause (section 25-8-

403). We are not willing to read into the statute what is not there.

See Chittenden, ¶ 20.

¶ 32 We also reject Peabody’s suggestion that because the

Executive Director authored the Final Agency Order, the

17
reconsideration process was not accomplished by the water

division.

¶ 33 Using the APA as a gap filler, the water division’s

reconsideration process must proceed as follows: An ALJ or hearing

officer must conduct a hearing and issue an “initial decision.” § 24-

4-105(14)(a). “‘Initial decision’ means a decision by a hearing officer

or [ALJ] which will become the action of the agency unless reviewed

by the agency.” § 24-4-102(6) (emphasis added). The parties must

then submit the “initial decision” for review by “the agency” to

preserve their right to judicial review. § 24-4-105(14)(b), (c). “The

agency” may then modify the ALJ’s factual findings and legal

conclusions, remand for further proceedings, or affirm, reverse, or

modify the order. § 24-4-105(15)(b).

¶ 34 Certainly, the identity of the agency reviewing the permit has

legal significance. Not every state agency has the authority to

review a permit issued by the water division. What person or

subdivision within the Department conducts the review

contemplated by section 24-4-105(15) depends on the Department’s

authority. As to permits for the discharge of contaminants into

water, the Department has broad authority as the government

18
agency charged with responsibility to administer and enforce water

quality control programs in Colorado, including the discharge

permitting program, § 25-8-301(1); to issue regulations, §§ 25-8-

102(1), 25-1.5-203; and to manage its duties relative to preventing,

abating, and controlling water pollution, §§ 25-8-102(3), 25-8-

202(1)(d), 25-8-503, C.R.S. 2019; see also § 25-6.5-102, C.R.S.

2019; Weld Air & Water, ¶ 34; Dep’t of Pub. Health & Env’t Reg.

21.4(K), 5 Code Colo. Regs. 1002-21. That the Department may

delegate some of its authority to the water division (or even to the

commission, which is not at issue in this appeal) does not mean it

is no longer the agency granted the authority in the first instance.

¶ 35 The APA’s adjudication procedures do not conflict with the

reality that agencies — like the Department here — often conduct

their business through subdivisions. In addition to empowering the

Department with enforcing water quality control regulations, § 25-

8-301(1), the Act empowers it to “maintain” the water division

within the division of administration, § 25-8-301(2), and to

implement rules to carry out its duties, §§ 25-6.5-102; 25-8-102,

25-8-202. It follows that under a regulatory scheme like that

contained in the Act and its implementing regulations, the

19
Department carries out its enforcement responsibilities through the

acts of its subdivisions.

¶ 36 The parties appear to agree that the Executive Director had

some authority to review the permit, so whether she could

permissibly act as “the agency” for purposes of section 24-4-105(15)

and Dep’t of Pub. Health & Env’t Reg. 21.4, 5 Code Colo. Regs.

1002-21, is not seriously disputed. Her participation in the water

division’s reconsideration process was necessary and proper. It

makes sense that a supervising agency, acting through its

Executive Director, needs authority to review an action taken by its

subdivision before that subdivision’s action becomes final. See

Hawes v. Colo. Div. of Ins., 65 P.3d 1008, 1016 (Colo. 2003)

(“[A]gencies possess implied and incidental powers filling the

interstices between express powers to effectuate their mandates.

Thus, the lawful delegation of power to an administrative agency

carries with it the authority to do whatever is reasonable to fulfill its

duties.”).

¶ 37 The significance of the Executive Director’s identity apart from

the water division was that, consistent with Dep’t of Pub. Health &

Env’t Reg. 21.4, 5 Code Colo. Regs. 1002-21, and APA section 24-4-

20
105(15), she was acting as “the agency” in concluding the water

division’s administrative reconsideration process for the 2015

Permit. Because that administrative reconsideration process was

the last step in the permitting process, the Final Agency Order was

final for purposes of judicial review. § 25-8-403; Dep’t of Pub.

Health & Env’t Reg. 21.4(K), 5 Code Colo. Regs. 1002-21. At that

point, the order was subject to judicial review within thirty days or

not at all. § 25-8-404(3).

¶ 38 Because Peabody filed its complaint thirty-five days after the

Department’s final order issued, the district court lacked subject

matter jurisdiction and properly dismissed it as untimely. C.R.C.P.

12(b)(1); Colo. Water Quality Control Comm’n v. Town of Frederick,

641 P.2d 958, 965 (Colo. 1982).

III. Dismissal With Prejudice

¶ 39 Although we affirm the district court’s judgment of dismissal,

the parties agree that the dismissal “with prejudice” was error and

request that we remand with directions to dismiss the action

“without prejudice.”

¶ 40 “A dismissal under C.R.C.P. 12(b)(1) is not an adjudication on

the merits, but rather is the result of a court lacking the power to

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hear the claims asserted.” Grant Bros. Ranch, LLC v. Antero Res.

Piceance Corp., 2016 COA 178, ¶ 35. Because the dismissal here

was pursuant to Rule 12(b)(1), the dismissal we affirm is necessarily

without prejudice, which the district court shall correct upon

remand.

IV. Conclusion

¶ 41 The district court’s order dismissing Peabody’s complaint

under C.R.C.P. 12(b)(1) is affirmed insofar as it concluded that the

complaint was untimely. But we reverse the with prejudice portion

of the dismissal and remand with directions to dismiss the action

without prejudice.

JUDGE BROWN and JUDGE ROTHENBERG concur.

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