This matter came on for hearing before the Honorable Joseph F. Wieners, Judge of District Court, at the Olmsted County Government Center, Rochester, Minnesota, on December 2, 2003, on cross motions for summary judgment.  James P. Peters of Peters & Peters, PLC, Alexandria, Minnesota, appeared on behalf of Plaintiffs.  Tom G. Dunnwald of Dunnwald & Peterson, PA, Minneapolis, Minnesota, appeared on behalf of Plaintiff-Intervenor City of Preston.  Kathleen L. Winters, Assistant State Attorney General, St. Paul, Minnesota, appeared on behalf of Defendant Minnesota Pollution Control Agency.  B. Andrew Brown of Dorsey & Whitney, Minneapolis, Minnesota, appeared on behalf of Defendant-Intervenor Heartland Energy & Recycling.

Based upon the written and oral arguments of counsel, the 2164-page MPCA Administrative Record, together with Exhibit A thereto, consisting of pages 2165-2410, 2411-2697, 3175-3181 and 3182-3304, and upon all of the other files, records and proceedings herein, the Court hereby finds and orders as follows:

1.         Plaintiff Southeastern Minnesotans for Environmental Protection’s and Intervenor City of Preston’s motions for summary judgment may be and hereby are reserved.

2.         Defendant Minnesota Pollution Control Agency’s and Intervenor Heartland’s motions for summary judgment may be and hereby are reserved. 

3.         The matter is remanded to the Minnesota Pollution Control Agency and the Minnesota Pollution Control Agency Citizens Board for reconsideration of its Findings of Fact, Conclusions of Law, and Order of February 26, 2003, so as to address the questions more fully set forth in the Memorandum of this Court attached hereto and made a part hereof.

4.         After preparation of responses to this Court’s questions, the Minnesota Pollution Control Agency and the Minnesota Pollution Control Agency Citizens Board shall provide Plaintiffs and Plaintiff-Intervenor with adequate time within which to prepare for a further hearing before the Environmental Review Committee prior to an ultimate further review of this matter by the Minnesota Pollution Control Agency Citizens Board, at which amended or additional findings of fact, conclusions of law, and an order regarding the need for an environment impact statement are to be considered that address this Court’s questions as set forth in the Memorandum attached hereto and made a part hereof.

5.         Various motions of the parties to supplement the record are remanded to the Minnesota Pollution Control Agency for consideration as to inclusion in the record in connection with the remand herein.

The attached Memorandum is incorporated herein by reference and made a part hereof.

Dated:  February 17, 2004

BY THE COURT: 

/s/ Joseph F. Wieners

Joseph F. Wieners

Judge of District Court
 

MEMORANDUM

            This matter is before the court on cross motions for summary judgment.  The matter is before the court pursuant to Minn. Stat. § 116D.04, subd. 10, which allows the court to consider the negative declaration decision with respect to the need for an environmental impact statement (hereinafter EIS) reached by the Minnesota Pollution Control Agency Citizens Board (hereinafter Board) on February 26, 2003.  There are both procedural and substantive issues that have been raised by the parties, and also pending before this court are motions concerning desired additions to the record.  Because this court has determined to remand the matter to the Minnesota Pollution Control Agency (hereinafter PCA) and the Board for further review in light of what this court believes to be a fundamental factual error possibly affecting the substantive issues, this court has determined that supplementation of the record can be left to the PCA upon their review.  The other procedural issues are moot in light of the remand. 

            Remand is one option available to a district court to require review of issues the court feels need consideration in connection with a negative declaration with respect to the need for an EIS.  See

 American Iron & Supply Company’s Proposed Metal Shredding Facility in Minneapolis, Minnesota, v. State of Minnesota, Minnesota Pollution Control Agency, 604 N.W.2d 140 (Minn. App. 2000)  (hereinafter the Kondirator case).  Remand in the present case seems to be particularly appropriate in light of the principle enunciated in Reserve Mining Co v. Minnesota Pollution Control Agency, 267 N.W.2d 720 (1978),  “that in scrutinizing administrative decisions there is a ‘need for exercising judicial restraint and for restricting judicial functions to a narrow area of responsibility lest (the court) substitute its judgment for that of the agency.’ ”  The Reserve Mining court suggested that if the agency acted arbitrarily and capriciously, “it was the duty of the trial court to remand the matter to the agency to correct its own errors and fashion amended permits . . .”    In White v. Minnesota Department of Natural Resources, 567 N.W.2d 724 (Minn. App. 1997), the court stated that “if the evidence submitted outside the administrative record demonstrates that the agency’s effort was clearly inadequate . . ., the court’s proper function is to remand to the agency for correction of the agency’s errors.” 

            The factual error with which this court is concerned represents  something of a twist on the above-referenced decisions.  Specifically, this court is concerned with the mischaracterization of the size of the pilot test plant upon which all, or almost all, of the computations, calculations, and extrapolations of the PCA are based in connection with their air quality determinations.

            The record reflects that PCA consistently referred to the three feet by three feet (nine square feet) pilot test plant as being nine feet by nine feet (81 square feet).  R. 417, 465, 1274, 1426, 1558, and 3259.  No one corrected the PCA as to their error until the plaintiffs did on the day of argument before this court.  (This court has chosen to disregard any determination as to the cubic-foot size of either the test plant or the proposed Heartland facility because the court understands that the depth of the burning medium is uniform whether it is the proposed Heartland plant at issue or a three-by-three or nine-by-nine test plant.  In other words, what is critical appears to be the square feet of the potential burning surface and not its depth.)  The error as to the test plant’s size has created a number of questions to be set forth below with respect to the PCA’s negative declaration as to the potential of the proposed Heartland plant for significant environmental effects.  The specific Findings of Fact that are called into question by virtue of the factual error are as follows:  8(a), (b) and (f); 11; 12; 21; 22; 23; 28; 30 and 31.  The specific Conclusions of Law implicated are Nos. 32, 33, 34 and 35. 

            For the reasons listed below, the court has questions necessitating this remand with respect  to the above-cited Findings and Conclusions:

            1.         There is no 100 % tire-derived fuel (TDF) fluidized bed plant operating in the United States.  R. 2117.  No EIS has ever been prepared anywhere in the United States as to such a plant.  There was discussion at PCA by various personnel as to the proper approach to take with respect to the environmental review involving what was characterized as a new source power or energy plant. (R. 462, 466.)  The court believes many scientists are concerned with how new technology will work in practice.  The pilot test plant upon which virtually all of PCA’s calculations were based was one-ninth the size that PCA thought it was and was itself “first generation.”  Question Number 1 then to be answered by PCA upon remand is whether or not emissions calculations were incorrect by a factor of nine (or some other number) by virtue of that fundamental mistake of fact. 

            Exacerbating this mistake in the Court’s view is the fact that the pilot plant results have never been peer reviewed, are more than 15 years old, and were disclaimed by the company conducting the tests.  R. 32.  (While PCA and Heartland appear sanguine as to the absence of peer review of the 15-year-old pilot test plant results, their position in this regard stands in stark contrast to the EPA report concerning air emissions from scrap tire combustion beginning at R. 1857 as that study specifically states that it “has been peer and administratively reviewed . . .  .”)  R. 1858. 

            2.         PCA is required to give a project a “hard look” (See O’Neill v. MPCA, 2002 W.L. 1423302 (Minn. App.).  The obvious error as to the pilot plant’s size highlights three other matters of concern.

            First, the record reflects that the PCA was short-staffed with respect to air risk assessment.  R. 406, 804. 

            Second, beginning at least as early as May 13, 2002, and continuing through June 11, 2002, a state representative had contact with the PCA’s Commissioner and other PCA personnel in what this court believes can be fairly characterized as a ham-handed effort to speed up the permitting process despite the fact that the Heartland project was behind seven other air projects to be analyzed by the PCA.  R. 406-408, 410-412, and 468-473. 

            Third, the procedural record shows consistent PCA noncompliance with statute §116D.04, subd. 2a (b).  Comments on the need for an EIS are to be submitted to the responsible governmental unit (RGU) during a 30-day period following publication of the notice that an environmental assessment worksheet (EAW) has been completed.  Here, there were so many comments that PCA apparently extended the deadline which would have been about September 30, 2002, until about October 21, 2002.  Section 116D.04, subd. 2a (b) further provides that the RGU’s decision on the need for an EIS is to be based on the EAW and the comments received during the comment period and shall be made within 15 days after the close of the comment period.  The statute further provides that the board’s chair may extend the 15-day period by not more than 15 additional days upon the request of the RGU.  Here the decision was not made by November 5 or at the latest November 20, as the statute requires.  Rather, the decision was made February 26, 2003, about three months later than the rule envisions.

            The record also shows PCA noncompliance with Minnesota Rules Chapter 4410.1700.  It states that “the decision on the need for an EIS shall be made in compliance with one of the following time schedules:  (a) if the decision is to be made by a board, . . . which meets only on a periodic basis, the decision shall be made between 3 and 30 days after the close of the review period.”  Thus, it seems to this court that a decision should have been made by about November 20, 2002, at the latest.

            Rule 4410.1700, subpart 2a, does indicate that the RGU can postpone the decision on the need for an EIS for not more than 30 days in order to obtain lacking information.  But if it does so it is to provide written notice of its action, including a brief description of the lacking information, within five days to the project proposer, the EQB staff, and any person who submitted substantive comments on the EAW.  There is nothing to indicate that this procedure was followed here.

            The question that arises is what was PCA doing between October 21, 2002, and February 26, 2003?  The court understands that under §116D.04, subd. 11, “any person” could have sought “an order of the district court requiring the board . . . to immediately take the action mandated by subdivisions 2a and 3a.”  The fact that nobody did so does not change the fact that the statute and rule were not complied with and that an extraordinary amount of testing and additional work seems to have been done by PCA subsequent to the receipt of the comments. 

            For example, it was during the questioned time frame that the proposer gave up on the idea of using wood as a fuel source.  R. 2357.  Additional information was provided by the consultant in December 2002.  R. 2330.  PCA performed a multipathway risk analysis the same month.  R. 2346. Pro-Corn and Heartland cumulative impacts modeling was completed in December 2002.  R 1052.  Other information concerning impacts of mercury on the Root River came in late in December (R. 1091) with PCA preparing additional information on Root River impacts on January 7, 2003.  R. 1125.

            Exacerbating the foregoing questions of procedure and preparedness is the fact that when members of the public asked for more time and a continuance of the February 25, 2003, scheduled Board hearing (R. 1249-50) to review the additional PCA work product, PCA refused.  It is ironic that at the argument of this matter both PCA and Heartland argued that “if people wanted more time and were concerned about the process, they should have asked for an extension under the rules.”  It turns out they did and they were denied.

            The broader question the foregoing raises is whether PCA had the time, personnel, and independence to give the Heartland project the requisite “hard look.”

            3.         Whether or not the PCA’s factual error as to the size of the pilot test plant changes any of the air emissions calculations, the following additional questions arise: 

                        a.         With respect to dioxins and furans, both an 18-square-inch pilot plant and a plant in Modesto, California, had (high) detectible emissions (R. 050 and 1993-1994) while they were not detected in the 3’x 3’ plant.  R. 1427.  Does PCA claim that the pollution control devices on the 3’x 3’ pilot plant totally eliminated all dioxin, furan and mercury emissions?  The court’s question in this regard repeats questions that staff itself had and questions posed by the Minnesota Department of Health.  R. 410, 765. 

            If the mysterious absence of mercury emissions and PCBs from the 3’x 3’ test plant as compared with both the 18” plant and the Modesto plant turns out to be a mistake, it is the people of the Preston area who will again suffer because, as the court has learned from a recent article, when mercury hits water, bacteria transform it into methyl mercury, a neurotoxin that irreparable damages brains, eyes and spinal cords, especially in young children and fetuses.  Symptoms include blurred vision, slurred speech, hearing loss, memory loss, cognitive dysfunction, behavioral disorders, coma, and death.  PCBs produce some of the same symptoms, cause cancer, and reduce IQs in children.  See attached article.

                        b.         As is discussed in Comment and Response No. 5 and in the corresponding Finding of Fact No. 8, there are other facilities in the United States that burn tires.  The EPA has studied their air emissions.  None of these plants employ the fluidized bed technology proposed by Heartland.  There are concerns of record as to this technology which have not been addressed in the findings.  Specifically, with respect to the important matter of turbulence within the burner, there is  a question relative to “clumping.”  R. 1908, 2117, 1845, 1854.  Did the test plant use shredded steel-belted tires and demonstrably avoid this problem?

                        c.         With respect to dioxins and furans, the record contains references to European fluidized bed plants.  Heartland asserted that they were able to meet more stringent European dioxin and furan emission requirements (R. 3252), but none of these plants burn anything other than a small percentage of tires.  R. 3245, 3246.  Considering that PCA was expressing a concern as to a lack of data and their belief that they needed to find better data, why, unlike the Kondirator case, supra, is there no actual data from European plants?

                        d.         The actual comparative size of the proposed Heartland plant to the pilot test plant is about 66 to 1.  The Heartland plant is to be 20’x 30’ or 600 square feet.  R. 3249.  When the pilot test model was erroneously thought to be 81 square feet, the comparative size ratio of the proposed Heartland plant to the pilot test plant was thought to be approximately 7.5 to 1.  This ratio was apparently of no concern to PCA and would have been of much less concern to this court.  However, the actual size ratio is about 66 to 1 as to the 3’x 3’ test plant and about 265 to 1 as to the 18”x 18” test plant.  (By way of comparison, the 3’x 3’ plant has the same surface area as a standard card table top and the 18”x 18” model is about the size of the seat on a dining room chair.)

            The court believes that PCA must take a second look at their findings in light of the actual size of the test plant for the following reasons: 

                        (a)       The Minnesota Department of Health states that “test burns rarely mimic  scale-up model burns.”  R. 764.

            (b)       Tom Degen, in a presentation to the West Virginia Joint Finance Subcommittee on December 13, 1998, concerning tire burning and the October 1997 EPA report concerning air emissions, stated with respect to a simulator that was roughly 20 to 40 times smaller than full-scale units that “because of the differences in scaling, emission factors from the simulator cannot be directly extrapolated to full-scale units.”  Furthermore, Degen quotes Paul Lemieux, project manager for the EPA study, to the effect that it should not be inferred “that the concentrations of pollutants from this apparatus would be the same as those from full-scale units.”  R. 1993, et seq.  (See also R. 1898, 1900, with respect to Mr. Lemieux’s comments in this regard.)  If Mr. Degen was concerned about a 40-1 or 20-1 ratio, should PCA not be concerned about a 66-1 ratio?

            4.         Does the mistake as to the size of the test plant call into question the results of the cumulative testing relating to the Pro-Corn ethanol plant and the proposed Heartland plant?  Specifically, if the calculations are inaccurate due to the mistake as to the size of the test plant, or if they are unreliable because of its small size, it seems to the court that the cumulative effects testing would also be erroneous. 

            The record makes plain that this question as to cumulative effects is perhaps the most important one to the citizens of Preston and their neighbors in the South Branch Root River Valley area.  The record shows that there were an extraordinary number of citizen comments concerning the Heartland project.  Appendix B lists 68 comments on the EAW.  R. 1425, et seq.  The comments demonstrate a remarkable citizen familiarity with the process.  This is no doubt due to the fact, as noted in Comment Response No. 13 at R. 1436, that the people of the Preston area have already been victimized as a result of the operation of the Pro-Corn facility.  People have experienced upper respiratory symptoms, eye irritation, and nausea. 

            While Heartland may prefer to ignore the Pro-Corn cumulative effects issue (R. 192, 193, 1090, 1093), its significance as a central issue was clearly identified by the Department of Health.  R. 764.  Although Pro-Corn, like virtually every other ethanol plant in the state of Minnesota, has been fined by the EPA and been required to install pollution control and monitoring equipment (R. 1515), the PCA soft-pedals the Pro-Corn issue.  For example, in Response 57 they disingenuously say that the Pro-Corn plant “is a regulated ethanol plant with current state and local permits.”  While perhaps technically true now, there is no hint in this response as to the EPA fines nor the after-the-fact required installation of pollution control equipment and monitoring devices.  In other words, the fact that the environmental review process failed with respect to Pro-Corn initially is nowhere admitted in the record. 

            At R. 1286 and 1515, Finding No. 21 discusses Pro-Corn.  While it may have been true at the time of the consideration of the matter originally that there were no actual stack emissions data available from Pro-Corn, that is not the case now.  Instead of relying upon some late-blooming,  post-EAW prepared extrapolations from a plant that was not demonstrated to be comparable in size or production methodology, there is now actual data from Pro-Corn upon which to reach a conclusion. 

            Procedurally the present case has some striking similarities to Trout Unlimited, Inc. v. The Minnesota Department of Agriculture, 528 N.W.2d 903 (Minn. App. 1995).  It seems to this court that Trout Unlimited, supra, appropriately instructs that environmental effects must be determined and addressed before they occur, not just fixed after the fact, as was done with Pro-Corn.  Therefore, this court believes that actual data should now be used from the Pro-Corn plant in connection with reconsideration of the cumulative effects issue.

            Apart from the foregoing questions that are directly related to the mistake as to the size of the pilot test plant, this court has the following additional questions from its review of the record that PCA and the Board need to address:

            5.         Initially, the Heartland plant was a co-generation facility that would use 80 % TDF and up to 20 % wood.  R. 3, 4, 182, 550.  During the comment period following the publication of the EAW, wood as a fuel source was deleted due to a concern about acrolein.  R. 945.  The specific question the court has with respect to this change is whether there was any recalculation or recomputation following this change and whether there was any resulting change in NO_x and/or the single HAP figures. 

            As can be seen from the table produced in Response 6 (R. 1427), both NO_x and single HAP test results as to the proposed Heartland plant are close to “major source level.”  (The Court understands that the proposer asserts that the NO_x level would actually be much less than the 245 tpy listed.) 

            6.         At R. 2014, Dr. Neil Carmon, a Texas Air Control Board investigator of toxic air emissions from synthetic rubber plants indicates that “aromatic extender oils comprise about 25 % of most tires today and are known to cause cancer in lab animals as well as being suspected human carcinogens.  These are highly aromatic -- multiple benzene-containing chemicals -- petroleum waste materials with complex ring structures that are even more difficult to burn than benzene.” Carmon states:  “Anything with benzene will require higher combustion temperatures, higher residence times and higher oxygen to break apart the six-carbon ring with electron clouds above and below that protect the ring from easy chemical breakdown.  The thick black oil and black smoke that one sees when tires are burning outdoors is due solely to the aromatic extender oils; they too require higher combustion temperatures, higher residence times, and higher oxygen to break down fully to CO² and water.” 

            In order to recapture the steel in the tires and to minimize NO_x emission, the temperature of the fluidized bed will be at 1600º.  (See R. 3246-3256.)  By contrast, cement kilns burn tires at such a high temperature that the tires are vaporized instantly and little smoke is emitted.  R. 2005.  While the court understands that the fluidized bed plant incorporates longer residence and higher turbulence than do many burning systems, the court has a concern as to whether PCA addressed the question of whether or not the proposed temperature is hot enough to overcome the problems about which Dr. Carmon writes.

            7.         At R. 2014 it is stated that zinc oxide is a major constituent of tires as it is used  to cure rubber.  A lot of it is to be emitted.  In high dosages zinc is an immune system suppressant.  It does not seem to the Court that PCA addressed the health concerns that seem to be implicit in the zinc emissions that this plant proposes to emit. 

            8.         At R. 1089 and 1092, numbers are presented with respect to the “farmers’ risk” that need review in conjunction with Finding of Fact 8 (f).  Does the “farmers’ risk” exceed the limit, and if so, why has that been ignored?

            9.         With respect to air dispersion modeling, there is a PCA staff comment that the receptor grid should be expanded out to 10 kilometers because of the height of the stack.  (R. 175.)  Heartland’s engineering advisors, Sebesta Blomberg, proposed in response to “begin the analysis with a grid extending at least 2 kilometers in all directions from the main stack.”  R. 177.  Further, “if the model results do not show clear fall-off of concentrations at the edge of the grid, the grid will be expanded enough to ensure that all maximum concentrations are identified.”   

            It is the court’s understanding that the Sebesta Blomberg response was adopted but the record contains nothing that this court found as to what was observed at 2 kilometers, and this discussion again comes up within the context of MPCA’s staff shortage.  R. 176.  In other words, it is unclear to the court whether the decision to test to 2 kilometers was based upon staff shortage, a justifiable, scientific reason, or an observed fall-off at 2 kilometers.

            10.       While it may be a comparatively small matter, the project initially did not include a roof on what the court understands will be a storage building.  The record indicates that that building now is to have a roof, but nowhere could the court find any information describing the roof.  That information should be forthcoming.