Hog farm ruling from appeals court may complicate other permits, environmentalists warn

A North Carolina Court of Appeals ruling recently could require environmental regulators to submit proposed changes to general permits to the state’s rule review process, attorneys on both sides of the case told The News & Observer.

A panel of three Court of Appeals judges ruled in N.C. Department of Environmental Quality v. N.C. Farm Bureau that three provisions regulators added to the 2019 general permit overseeing waste management systems on hog farms are actually rules and, thus, need to undergo the formal rule-making process before becoming effective.

Environmental advocates argue that the rule-making process is a way to delay regulations, hinders DEQ’s ability to properly carry out its mission and offers too many opportunities for business and political interests to halt necessary rules. Regulated groups like the Farm Bureau say the rule-making process offers the public and those who are subject to rules a key chance to weigh in and potentially to halt unneeded rules.

A general permit allows someone to obtain a certificate of coverage for a certain activity as long as they meet the conditions spelled out in the permit. General permits are used throughout environmental regulation, not only for animal waste management activities, but also for construction activities like grading and to regulate stormwater from more than 20 industries.

The DEQ v. Farm Bureau case hinged on whether a general permit was “generally applicable” like a rule or sufficiently tailored to only apply in certain cases.

In his opinion, Judge Jeff Carpenter wrote, “The conditions within General Permits are generally applicable regulations under the (N.C. Administrative Procedures Act). They are rules.”

The provisions challenged in the DEQ v. N.C. Farm Bureau case required farms with waste lagoons in the 100-year floodplain to conduct groundwater monitoring; required farms whose sprayfields have high phosphorous levels to measure how much is being lost and either limit how much waste is sprayed there or stop it altogether; and required farmers to submit an annual report to regulators about their waste management systems.

Reactions to the ruling

State law requires that lagoons and other waste management systems on hog farms be regulated by a general permit.

In an emailed statement, Jake Parker, the Farm Bureau’s general counsel, told The News & Observer the decision means future conditions will need to undergo the rule-making process before they can be put into animal waste management permits.

“That’s a good thing because the rule-making process, while burdensome for the agency, provides meaningful procedural rights for the regulated community and general public,” Parker wrote.

Blakely Hildebrand, a senior attorney for the Southern Environmental Law Center who represented the N.C. Environmental Justice Network in the case, told The News & Observer that the Appeals Court judges didn’t explain why the three challenged provisions needed to undergo the rules review process while about 80 other provisions in the 2019 permits did not.

The decision could be understood as meaning that every proposed change to every general permit must go through the rule-making process, Hildebrand said.

“If DEQ reads it that way, I really don’t know how they will proceed because the rule-making process is a very cumbersome, lengthy and drawn out process, and the prospect of all provisions of general permits having to go through rule-making seems like a regulatory nightmare,” Hildebrand said.

Asked for comment, Sharon Martin, a DEQ spokeswoman, only said that the agency is reviewing the decision.

Michelle Nowlin, the co-director of Duke University’s Environmental Law and Policy Clinic, called the ruling “overly simplistic” and said it doesn’t account for ways that the general permit considers the individual characteristics of each farm.

The hog farms do include provisions that apply to each facility, Nowlin said, things like requiring farms to keep waste levels in lagoons low enough to prevent spills during a 1-in-25 year rainfall over a 24-hour period.

But the court didn’t account, Nowlin added, for the certified animal waste management plans that are part of each operation’s certificate of coverage under the general permits. Those plans consider the individual characteristics of each farm and mandate different rules like what crops can be grown on the fields where waste is being sprayed, how much waste can be spread on those fields based on the crops growing there and what kind of vegetative buffers need to exist around farms.

“There are some provisions within the general permit that are generally applicable, and then there are some that are not,” Nowlin said.

It is unclear whether DEQ, the Environmental Justice Network or the NAACP will appeal to the state Supreme Court.

Rule-making and the environment

In a typical general permit process, DEQ works with stakeholders including industry groups and environmental advocates to craft the initial permit. It then puts a draft permit forward for comments, potentially including one or more public hearings.

Staff use the feedback received during that process to make any tweaks to the final permit.The process is generally completed in under a year.

The formal rule review process brings several outside entities into the process and can take more than two years.

Under the rule-making process, an agency like DEQ needs to publish the proposal in the N.C. Register and then wait at least 60 days before approving it. DEQ’s Environmental Management Commission — a commission whose makeup the General Assembly shifted this year so that Gov. Roy Cooper no longer appoints a majority of members — would then need to approve the rule.

At that point, the rule must be filed for review with the Rule Review Commission. If the Commission objects to a rule, the agency has a chance to revise it.

Environmental rules — and particularly coastal management rules — have run into problems at this point in the process. The Rules Review Commission has returned six rules to the Environmental Management Commission and dozens more to the Coastal Resources Commission over the past two years.

Requiring that review could complicate the permitting process, Nowlin said, making it harder for regulators to include changes in the final permit like accounting for how climate change might be shifting floodplains or shifts in groundwater that require changes to how much waste is sprayed.

“It’s longer, it’s more onerous and there are many more opportunities for special interests to torpedo DWR’s effort,” Nowlin said.

If the commission approves a rule, there’s another potential hurdle.

Should 10 parties file letters of objection to the rule and request legislative review by 5 p.m. the day after the rule is approved, the General Assembly has potential oversight. There, lawmakers could introduce a bill that strikes down the proposed rule.

“It gives the legislature yet another role in dictating what goes into these permits,” Hildebrand said.

The rule-making process would also have the effect of tying up DEQ staff, Nowlin said.

It typically takes more than two years for a rule to become effective in North Carolina, and the general permits must be renewed every five years according to state law.

“That essentially means that DEQ would always be in rule-making,” Nowlin said.

Updated general permits

The ruling comes even as DEQ is crafting updated general permits for hog, cattle and the state’s few wet-litter poultry waste management systems. That review is happening concurrently with the general permits that regulate digesters that capture methane from the waste so it can be re-used as a fuel source.

DEQ’s draft hog permit included the three conditions that were challenged by the Farm Bureau. Industry representatives previously told The N&O those provisions should not have been included in the permits as long as they were the subject of active litigation.

After this week’s ruling, Parker wrote, “In response to the Court’s ruling, we hope DEQ will take the conditions out of the final version of the renewed permits. If not, we may have to go to court again to protect the interests of its farmer members. Hopefully, things won’t come to that.”

This story was produced with financial support from the Hartfield Foundation and 1Earth Fund, in partnership with Journalism Funding Partners, as part of an independent journalism fellowship program. The N&O maintains full editorial control of the work.