01-001490 Jacqueline M. Lane vs. International Paper Company And Department Of Environmental Protection Status: Closed Recommended Order on Friday, August 24, 2001.

Summary: International Paper Company provided reasonable assurances of its ability to comply with existing industrial wastewater treatment facility permit and related documents which justified transfer of permit.

STATE OF FLORIDA

DIVISION OF ADMINISTRATIVE HEARINGS

JACQUELINE M. LANE, )

)

Petitioner, )

)

vs. ) Case No. 01-1490

)

INTERNATIONAL PAPER COMPANY and )

DEPARTMENT OF ENVIRONMENTAL )

PROTECTION, )

)

Respondents. )

__________________________________)

RECOMMENDED ORDER

Pursuant to notice, the Division of Administrative

Hearings, by its duly-designated Administrative Law Judge,

Charles A. Stampelos, held a final hearing in the above-styled

case on June 19 and 20, 2001, in Pensacola, Florida.

APPEARANCES

For Petitioner: Jacqueline M. Lane, pro se

10738 Lillian Highway

Pensacola, Florida 32506

For Department of Environmental Protection:

Craig D. Varn, Esquire

3900 Commonwealth Boulevard

Mail Station 35

Tallahassee, Florida 32399-3000

For International Paper Company:

Terry Cole, Esquire

Patricia A. Renovitch, Esquire

Oertel, Hoffman, Fernandez & Cole, P.A.

Post Office Box 1110

30 1 South Bronough Street, Fifth Floor

Tallahassee, Florida 32302-1110

STATEMENT OF THE ISSUES

The first issue is whether Petitioner, Jacqueline M. Lane

(Lane) has standing. The second issue is whether International

Paper Company (IP) provided reasonable assurances it has the

ability to meet the conditions of the existing industrial

wastewater permit for the wastewater treatment facility at the

paper mill in Cantonment, Florida, pursuant to Rule 62-

620.340(3), Florida Administrative Code. A final issue is

whether Lane litigated this matter for an improper purpose.

PRELIMINARY STATEMENT

On or about April 4, 2001, Lane filed with the Florida

Department of Environmental Protection (Department or DEP) a

"Petition for Formal Administrative Proceeding Challenging

Florida Department of Environmental Protection's Agency Action

Granting the Transfer of Combined EPA and State Permit FL

0002526" (Petition). The Petition challenged the Department's

proposed transfer of permit number FL0002526-002-IWF/MT (permit)

and related documents, from Champion International Corporation,

Inc. (Champion) to IP. The permit authorizes operation of the

industrial wastewater treatment facility (facility) at the paper

mill in Cantonment, Florida.

The Department transferred Lane's Petition to the Division

of Administrative Hearings (Division) for the assignment of an

Administrative Law Judge to conduct all necessary proceedings

pursuant to Sections 120.57(1) and 120.569(2)(c), Florida

Statutes (2000), and to submit a recommended order to the

Department. A final hearing was scheduled for June 19 and 20,

2001, in Pensacola, Florida.

On April 30, 2001, IP filed a Motion to Dismiss the

Petition, and in the alternative, requested Lane to file a more

definite statement and identify the water quality standards

violated by IP. Lane filed a Response. The Motion to Dismiss

was denied. However, Lane was permitted to file a more definite

statement "reciting specific violations which Lane believes can

be attributed to IP and any other specific violations which can

be attributed to Champion."

On May 18, 2001, Lane supplemented her Petition by filing a

document titled "Petitioner Lane's Response to Administrative

Law Judge's Order for a More Definite Statement on IP's Specific

Violations of Their Permit Since January 1, 2001." Lane's

Response alleged IP violations, citing to provisions of the

Florida Administrative Code, and incorporated by reference the

allegations set forth in paragraph four (4) of her Response.

On June 8, 2001, IP filed a Motion in Limine, requesting an

order to limit the issues at the final hearing to consideration

of IP's ability to comply with the "four corners" of the terms

and conditions in the permitting documents listed in the Motion

in Limine at paragraph 5. The parties disagreed on the scope of

the permitting terms and conditions. The Department supported

the Motion.

Lane filed a Response and had "no objection to limiting the

proceeding to the permit terms contained within the four

documents that IP listed in paragraph 5 and Exhibits A through

D." Lane believed that consideration should also be given to

compliance with the Temporary Operating Permit and the Consent

Order issued therewith. Further, Lane contended that "IP is

supposed to meet Water Quality Criteria given in F.A.C. 62-

302.500 and 62-302.530 . . .." Lane also discussed the

relevancy of various portions of the permitting documents. Lane

argued, in part, that "Champion never came into compliance with

the permit in question, and neither has IP" and that, pursuant

to Rule 62-620.340, Florida Administrative Code, the "permit can

not be transferred until [IP] complies with the terms of the

permit." Essentially, Lane wanted "to prove that IP is not

meeting the terms of the permit and related documents . . .."

After oral argument, the Motion in Limine was granted and

the evidence "was limited solely to the ability of IP to comply

with the conditions within the four corners of the existing

permit and related documents."

On June 14, 2002, IP filed a Motion requesting a summary

recommended order, recommending dismissal of Lane's Petition for

lack of standing. On June 25, 2001, Lane filed a Response.

The final hearing was held June 19 and 20, 2001, and

commenced with argument on IP's Motion for Summary Recommended

Order and Lane's Response. IP and the Department contended the

transfer of the permit would not result in any injury to Lane,

as she repeatedly stated in her pre-hearing deposition. Lane

asserted her "harm" was the Department's continuing failure to

enforce conditions in the existing permit. See also paragraph 3

of Lane's Response to IP's Motion for Summary Recommended Order,

filed June 25, 2001. The undersigned deferred ruling on this

Motion until the issuance of this Recommended Order.

During the final hearing, the Respondents offered the

testimony of two witnesses. The Department called William A.

Evans (Northwest District Industrial Wastewater and Underground

Injection Control Permitting Supervisor and expert in

environmental engineering). IP called Kyle Moore (IP

Environmental Supervisor and expert in environmental

engineering). The Department introduced eight exhibits, all

admitted into evidence.

Lane offered the testimony of eight witnesses, James Lane

(professor), Erica Mitchell (Northwest District Enforcement

Coordinator), Franklin Matthew Dimitroff (Northwest District

Environmental Specialist II), Bobby Cooley (former Northwest

District Director), Donald Ray (DEP Environmental Specialist II

and expert in freshwater stream ecology), William A. Evans

(recalled), Kyle Moore (recalled), and herself (expert in marine

biology). Lane identified ten exhibits; seven were admitted (1-

3, 5, and 7-9), two were not offered (4 and 6), and one (10) was

rejected.

The two volumes of the final hearing Transcripts were filed

with the Division on July 5, 2001. All parties filed Proposed

Recommended Orders and IP filed a Motion for Reasonable

Attorney's Fees and Costs pursuant to Section 120.595(1),

Florida Statutes (2000).

FINDINGS OF FACT

Based on the evidence and testimony of the witnesses

presented and the entire record in this proceeding, the

following facts are found:

The Parties

1. The Department is charged with the responsibility for

determining whether to approve the Application for transfer of

permit number FL0002562-002- IWF/MT from Champion to IP.

2. IP is a corporation authorized to do business in the

State of Florida. IP operates a bleach kraft fine paper mill in

Cantonment, Florida, formerly operated by Champion.

3. Lane is a citizen of the State of Florida who lives on

Perdido Bay.

Application for Transfer of Industrial Wastewater Permit

Number FL0002526-002- IWF/MT

4. In June 2000, IP notified the Department it was

acquiring Champion as a wholly owned subsidiary. IP took over

operation of the facility in Cantonment on January 1, 2001. At

that time, the companies had fully merged.

5. On January 19, 2001, IP timely submitted an Application

for Transfer of a Wastewater Facility or Activity Permit

(Application) and advised the Department that "the permittee

name for the pulp and paper mill in Cantonment, Florida[,] has

been changed from 'Champion International Corporation, Inc.' to

'International Paper Company.'" Several wastewater permit-

related documents were submitted to the Department as part of

this name change.

6. The Department processed IP's Application to transfer

the facility's permit pursuant to Rule 62-620.340(3), Florida

Administrative Code. "The parties agree that this matter is

controlled by Rules 62-4.120 and 62-620.340, F.A.C., regarding

the transfer of the permit. The parties [did not agree] upon

what conditions of the combined permits are applicable to

determine whether the Department has received 'reasonable

assurances that the conditions of the permit will be met.' Rule

62-620.340(3), F.A.C."

7. Rule 62-620.340(3), Florida Administrative Code,

provides: "The Department shall allow the transfer under

subsection (2) of this section unless it determines that the

proposed permittee cannot provide reasonable assurance that

conditions of the permit will be met. The determination shall

be limited solely to the ability of the proposed permittee to

comply with the conditions of the existing permit, and it shall

not consider the adequacy of these permit conditions. "

(Emphasis added).

8. This proceeding does not involve an enforcement action

or consideration of whether the wastewater permit, and related

documents, should be renewed. Champion's renewal application is

under consideration by the Department.

9. The parties agree that the documents described in

Findings of Fact 10-19, infra , set forth the conditions of the

permit number FL0002526-002-IWF/MT at this time. These

documents are listed below:

November 15, 1995, DEP Order (combining

the NPDES permit and the State-

issued wastewater permit)

April 22, 1996, DEP Letter (clarifying

November 15, 1995, Order regarding

1983 NPDES Permit)

January 3,1983, EPA NPDES Permit

December 13, 1989, DER Temporary

Operating Permit

December 1, 1989, DER Consent Order

December 12, 1989, DER Variance

The Permit(s), Consent Order, Variances, and Related Permit

Documents

10. Before May 1, 1995, in order to operate the wastewater

treatment facility at the mill in Cantonment, both state and

federal permits were required. The Department or its

predecessor agency, the Department of Environmental Regulation

(DER), issued state permits pursuant to Sections 403.08 and

403.088, Florida Statutes, and applicable rules. The United

States Environmental Protection Agency (EPA) issued federal

National Pollutant Discharge Elimination System (NPDES) permits

pursuant to 40 Code of Federal Regulation Section 124.15. As a

result of EPA's delegation of its NPDES authority to the

Department in 1995, only one permit is now required.

11. The 1995 Memorandum of Agreement between EPA and the

Department does not allow the Department to modify a permit that

has been administratively continued. Modifications to permit

limits have to be made through the permit renewal process.

12. On or about January 3, 1983, the EPA issued a NPDES

permit to St. Regis Paper Company, authorizing discharge from

the facility, located at the paper mill in Cantonment to the

receiving waters named Eleven Mile Creek (creek). This NPDES

permit contains the federal permit conditions applicable at this

time. (EPA has since used the facility as a benchmark model to

develop effluent guidelines for its new cluster rule.)

13. On December 1, 1989, the DER entered into a Consent

Order with Champion International Corporation. This Consent

Order was issued as a result of Recommended and Final Orders

issued in Perdido Bay Environmental Association, Inc. et al. v.

Champion International Corporation and Florida Department of

Environmental Regulation , 12 F.A.L.R. 126 (DER Nov. 14, 1989).

14. This Consent Order allowed the continued operation of

the facility. As a compliance requirement, a study report was

required to include "an evaluation of technologies and treatment

alternatives . . . to determine the most environmentally sound

and practicable means to correct identified water quality

violations caused by Champion." The studies required by the

Consent Order are needed to pinpoint sources of pollutants in

the creek and Perdido Bay (bay).

15. The Consent Order has no expiration date although it

is tied to the temporary operating permit (TOP) which had an

expiration date of December 1, 1994. Extensive studies have

been submitted to the Department pursuant to paragraph 14.A. of

the Consent Order, which are necessary to trigger "the final

compliance plan." This has been an ongoing process since the

Consent Order and TOP were issued.

16. The conditions in the Consent Order and TOP apply at

this time. Various discharge limitations and monitoring

requirements are set forth in the TOP.

17. On December 13, 1989, DER issued a TOP, Number IT17-

156163, to the facility, which was issued in conjunction with

the Consent Order. The TOP expressly relies on the Consent

Order for authorization. It contains the effective state permit

conditions at this time.

18. On December 8, 1989, DER issued a Variance from water

quality standards for color (transparency), iron, zinc, and the

general water quality criterion for specific conductance. The

standards in the Variance are part of the TOP and are effective

at this time. The mill no longer needs the Variance for iron

and zinc. As to those parameters, it currently operates at

lower levels than under the Variance.

19. On November 15, 1995, the Department combined the

state and federal operating permits into a single permit

identified as Wastewater Permit Number FL0002526-002-IWF/MT.

20. The TOP and NPDES permit were administratively

continued when renewal applications were filed.

21. The Department will transfer to IP the permit

documents described in Finding of Fact 9, supra . The Department

will also transfer the pending permit renewal applications filed

by Champion.

Wastewater Treatment Facility at the Paper Mill in

Cantonment, Florida

22. In the past, Champion owned and operated a 1400-ton

per day bleach and kraft pulp and paper mill in Cantonment. The

operation is now conducted by IP. The paper mill treats its

effluent from industrial activities at an on-site wastewater

treatment facility (facility). Stormwater that falls on the

industrial portion of the mill is also processed through the

facility.

23. The mill is required to and takes monthly samples from

the creek for a few parameters, e.g. , DO and pH, to provide data

to the Department for use in developing possible changes to

effluent limitations in a final compliance plan.

24. There is an installed structure that continuously

measures the flow of the effluent at the end of the facility's

treatment system. This point, i.e. , where the flow is measured,

is called the Parshall Flume which is the compliance point for

the facility. The effluent at Parshall Flume is automatically

sampled each day, analyzed, and reported on a monthly basis to

the Department. The analyses are reviewed and compared to the

effluent limitations for a particular permit.

25. The treated effluent is discharged from the Parshall

Flume through a pipe to natural wetlands. In this wetland area,

the treated effluent combines with several streams, non-

processed stormwater, and runoff from land south and west of the

facility. Runoff from residential areas and areas west of the

mill, including the City of Cantonment, also flows into this

area. The IP mill is not the only source of discharge into this

area.

26. After passing through the natural wetlands, the

treated effluent runs through a pipe that discharges into the

creek from below the surface. This point is about a half-mile

from the facility. It is called the "boil" because the water

from the pipe boils up into the creek. The "boil" is not a

compliance point. On occasion, a Department inspector has taken

water samples at the boil. Each time, his sampling has shown

water quality standards were met at the boil.

27. At the boil, the water flowing into the creek from the

pipe contains treated effluent and drainage from areas not

associated with the mill. From the boil, the creek flows a

distance of fourteen miles to Perdido Bay (the bay).

28. At the boil, there is also stormwater runoff and

drainage from residential areas flowing into the creek in

addition to the water from the pipe. Along the sides of the

creek to the bay is a large drainage basin, which includes

agricultural and residential runoff that flows into the creek.

The boil, which is non-processed stormwater of the creek, could

be contaminated from non-IP sources.

29. Sources of pollutants in the bay include residential

and agricultural stormwater runoff, Perdido River, and the

creek. The Escambia County Utility Authority (ECUA) also has a

treatment plant that has a discharge into the bay. Saltwater

intrusion and runoff from development are additional sources of

pollutants in the bay.

30. Lane takes samples at the boil and most recently in

May and June of 2001. Her measurement of dissolved oxygen (DO)

was approximately 2.6 and for specific conductance, between 1600

and 2000. Lane also samples the water at a bridge (279A) two

miles down the creek from the boil. Lane testified regarding

bacteriological quality at the boil or further down stream, that

fecal coliforms, including the bacteria Klebsiella, were

present.

31. Lane is not a certified sampler. She does not have

the required quality control/quality assurance program. Lane

does not know the Department requirements to sample dissolved

oxygen. She could not describe an approved standard for such

sampling.

Surface Water Quality Standards

32. Unless otherwise provided through relief mechanisms,

discharges into surface waters must meet the minimum water

quality standards set forth in Rules 62-302, Florida

Administrative Code. Relief mechanisms include variances,

consent orders, and temporary operating permits.

33. The Department has issued variances, consent orders,

and temporary operating permits to allow permit holders time to

respond to changes in water quality standards and related

regulations that reflect changes in understanding of

environmental impacts to water bodies.

Permit Conditions

34. The permit conditions do not require compliance with

all the water quality criteria in Chapter 62-302, Florida

Administrative Code, for water quality parameters. The

Department has not yet agreed on "final treatment solutions" it

can require under the Consent Order. See , e.g. , Finding of Fact

49.

35. Specific deviations from the surface water quality

standards in Chapter 62-302, Florida Administrative Code, are

authorized by the Consent Order, TOP, variance, and NPDES

permit.

36. The specific effluent discharge limitations in the TOP

and NPDES permit, are for BOD 5 , TSS, iron, specific conductance,

pH, and zinc. (The reference to condition 12 in paragraph 25 of

the TOP has not been amended.) Several of the effluent

limitations ( e.g. , specific conductance) were granted by the

Variance.

37. Paragraph 26 of the TOP specifies the monitoring and

frequency requirements for the monitoring at the Parshall Flume.

This monitoring information can be used by the Department to

pinpoint sources of pollutants in the creek and in order to

establish numerical, water-quality based effluent limitations

for those sources.

38. General Condition 5 of the TOP does not per se impose

on the mill the duty to meet all water quality standards in

Chapter 62-302, Florida Administrative Code. The TOP authorizes

"a certain amount of pollution" and "certain relief." The TOP

further established a "compliance schedule" for Champion to

study the impacts of the discharge. However, the Department

rules allow for reopening of the TOP and changing the permit

conditions to reflect new evidence causing a concern regarding

pollution. Here, the Department has not reopened the TOP.

39. The permit, including the TOP and Consent Order,

allows the mill a period of time to come into compliance with

all minimum water quality standards. When a final permit is

eventually issued, the facility will have to meet these

standards absent some express relief mechanism at that time.

IP Provided Reasonable Assurances of Its Ability to Meet

Permit Conditions

40. The Department employee who reviewed IP's Application

to transfer the permit is an expert in environmental

engineering. At the time he reviewed the Application, he was

familiar with the existing permit conditions. As part of his

review, he ascertained whether IP was satisfying the conditions

of the permit and determined it was.

41. The Department reviewed IP's annual report and other

corporate brochures as part of its processing of the transfer

Application. Information in these documents revealed IP has

obtained other Federal-type NPDES permits for other companies at

several other facilities.

42. The Department was familiar with IP's local management

at the Cantonment facility when it processed the transfer

Application. IP brings considerable "capability and talent" to

the mill. The Department performed inspections during the last

six (6) months and was familiar with the facility and wastewater

system.

43. IP is an international company with greater financial

resources than Champion. It has approximately $30 billion in

annual sales. Champion, in comparison, generated about $5

billion a year. It is clear that that the operation of the mill

and the facility would have less capital and financial support

without IP.

44. Since June 2000, IP has worked with the Department in

a continuation of the Department's concept of relocating the

facility's discharge to wetlands. The plan considers removal of

the facility's treated effluent from the creek to wetlands on

IP's land and effectively eliminates it as a point source

discharge and removes the discharge from the creek.

45. IP will have a greater ability than Champion to meet

permit conditions due to greater financial sources, technical

staff, and resources. IP's management is committed to resolving

water quality issues like specific conductance and is willing to

resolve outstanding water quality issues in the bay and creek.

46. In the view of the former Northwest District Director

who worked on water quality issues at the facility for twelve

years ending March 31, 2001, the current plan to discharge to

wetlands will be implemented and allow compliance with all water

quality standards. He also opines that IP has the ability to

comply with water quality standards under the plan to discharge

to wetlands.

47. In the Department's view, IP has provided reasonable

assurances that it has the ability to meet the existing

conditions of the permit sought to be transferred.

IP Complies with Permit Conditions as Evidence of Ability

48. According to the Department's expert, Mr. William A.

Evans, a professional engineer with a Master's degree in civil

engineering and an expert in environmental engineering, there

have been no verifiable violations of permit conditions and no

exceedances since January 2000, before IP took over operations

of the mill. On the other hand, Mr. Evans, in reviewing a

discharge monitoring report for IP for April 2001, advised,

during cross-examination, that there appeared to be "an apparent

violation, exceedance of the permit" for specific conductance

pursuant to the 1500 micromhons per centimeter limit in the

EPA's version of the permit. However, the Variance, which is

part of the Application, was granted "because there is no

practicable means known or available for the adequate control of

the pollution involved," i.e. , specific conductance. The

Department applies the limit of 2500 micromhos per centimeter

set forth in the Variance for specific conductance, which is a

reasonable interpretation of the permit documents. When the

permit documents, including the Variance are read in this light,

IP is in compliance with this limit.

49. IP is in compliance with the Consent Order, NPDES

permit, and Variance. In making this finding, the undersigned

is mindful of Lane's arguments and facts presented. The issue

here is not black or white; violation or no violation. As noted

by Mr. Evans:

This permit is recognized since '89 is

[sic] not meeting water quality standards.

It has all these documents because it

doesn't. And they're still working under

those. And the Department agrees with Ms.

Lane that they are not meeting water quality

standards in the creek. And we're working

under these documents to make improvements.

And so is Champion and so is IP. But

they are not, in our opinion, violating the

conditions of the permit. There [sic] are

complying with studying it, meeting the

interim limits that are set forth in the

permit. And that is what the Statutes

require when a facility can not meet all the

standards of a permit.

The Department, while considering the renewal application, has

not approved it yet because they have not received reasonable

assurances that new permit conditions can be met. Champion, and

now IP, are facing the continuing challenge of satisfying, among

other requirements, water quality standards, which takes time,

money, and know-how. The Department rightly believes that IP

can best meet this challenge.

50. The Department's review of the monthly monitoring

reports submitted by the mill since Champion was purchased

reveals the facility has complied with permit conditions. The

most recent monthly report was submitted May 23, 2001, and

includes data through April 2001. During inspections at the

facility since June 2000, the Department found no violations of

permit conditions.

51. The mill, under IP's operation, has not exceeded the

fecal coliform conditions of its permit. The mill has no

significant contribution to fecal coliform in the creek because

it treats its own domestic sewage and meets the fecal coliform

limit at the compliance point. Runoff along the creek from

agricultural and domestic sources could contribute to fecal and

total coliform in the creek.

52. The Department enforces the "more stringent" pH

condition in the 1989 TOP and Variance which is controlling over

the less stringent standard in the 1983 NPDES permit. The pH

limit in the NPDES permit is 6.0-9.0.

53. The Department reasonably interprets the freshwater

stream pH rule to mean enforcement is not required if the

permittee meets the range in the rule (6.0-8.5), more stringent

than the 9.0 limit in the NPDES permit. The facility's pH data

satisfies this range. If the Department were to enforce a limit

of 6.5, instead of 8.5, IP has the ability to meet the lower

limit by installing one of several available technologies to

control the pH levels. IP's current proposal includes one of

these technologies.

54. The biological integrity provision in the Consent

Order requires studies on biological components of the creek and

pH impacts this condition.

Permit Conditions Affecting the Creek and Bay

55. The permit does not require the facility to meet all

the minimum surface water quality standards of Chapter 62-302,

Florida Administrative Code, in the creek and bay. That is

because of the relief mechanisms in the Consent Order, TOP,

NPDES permit, and Variance.

56. The Consent Order provides a time frame for the

facility to come into compliance with water quality standards in

the creek and bay.

57. In terms of the Consent Order, the Department

considers IP to be at the paragraph 14.A. step of the compliance

schedule since the Department has not yet "resolved or agreed on

the final corrective action required under this [C]onsent

[O]rder." The Department considers the facility to be in

compliance with permit conditions because it is "working under a

complying [sic] schedule and an order or a temporary operating

permit." See Finding of Fact 49.

58. As long as IP is meeting the "interim limits that are

set forth in the permit," it is not violating conditions of the

permit.

59. The Department is aware of water quality exceedances

from the standards in the creek and bay caused by the mill.

This data was reported in the "fifth year surveys." This

information serves as a basis for making improvements and

finding "a new solution for the effluent as required by the

consent order." See Finding of Fact 49.

Proposal for Joint Project with ECUA

60. IP and the ECUA are working with the Department on a

plan than would result in the discharge of IP's treated effluent

to wetlands, thereby removing the effluent from the creek. IP's

financial capability, size, and technical human resources make

this plan feasible.

61. IP will propose a plan to satisfy the Consent Order

which consists of three parts: upgrading IP's industrial

wastewater treatment facility; allowing ECUA to locate an

advanced domestic wastewater treatment plant on its land; and

disposing the treated effluent from both facilities to wetlands

on IP's land through a pipeline.

62. The proposed plan to discharge the facility's treated

effluent to wetlands is a suitable solution that will allow the

mill to meet minimum water quality standards.

63. Lane has no objection to the plan to discharge to

wetlands. It will resolve all her water quality issues. She

believes the plan, similar to a prior plan, is "feasible."

Standing and Improper Purpose

64. Lane admits the Department is not making any changes

to existing permit conditions before transferring it to IP.

65. Lane agrees that changing the name on the permit from

Champion to IP has no adverse affect on her.

66. Lane brought this proceeding because she is

dissatisfied with the manner in which the Department is

enforcing conditions in the facility's permit. According to

Lane, "They haven't done their duty."

67. Her main complaints are with the Department's failure

to enforce the permit conditions and the lack of a permit that

makes the permit holder comply with Florida law. Lane feels

that Champion violated permit conditions in the past, and IP is

currently violating permit conditions and, as a result, the

permit should not be transferred because a decision to transfer

is an implicit finding of compliance. In this light, Lane

argues that past performance can be an indication of future

ability or lack thereof.

68. Lane acknowledges that in order to add conditions to

the existing permit, the Department must provide notice to the

mill and give it a chance to meet the proposed conditions. She

further admits the Department has not provided such notice.

69. Lane proved that the environmental situation attending

Champion's, and now IP's, operation of the mill and the

wastewater facility has been and is less than optimum and in

need of positive changes. The Department agrees and so does IP.

70. Lane's personal observations of the condition of the

creek and bay are documented. However, Lane did not prove that

she will suffer an "injury in fact" if the permit and related

documents are transferred to IP. Lane is not otherwise

substantially affected by the Department's decision to approve

the transfer. Lane's evidence did not rebut IP and the

Department's proof that IP has the ability to comply with the

permit conditions. The preponderance of the evidence shows that

the environment in and around the mill and the facility has a

better opportunity for improvement if IP takes control of the

mill and facility.

71. On the other hand, based on this record, Lane did not

bring this case for an improper purpose.

CONCLUSIONS OF LAW

72. The Division of Administrative Hearings has

jurisdiction over the parties and subject matter of this

proceeding, pursuant to Sections 120.569 and 120.57(1), Florida

Statutes (2000).

73. The Department is the state agency charged with

establishing a permit system for the operation of installations

that may be a source of water pollution, pursuant to Sections

403.061(14), 403.087, 403.088, and 403.0885, Florida Statutes

(2000).

74. IP, as the permit applicant, has the burden of proving

by a preponderance of the evidence that it provided reasonable

assurances of its ability to meet the conditions of industrial

wastewater permit number, FL0002526-002-IWF/MT.

Lane Lacks Standing to Challenge the Department’s Transfer

of the Permit

75. Lane stated in her Petition challenging the

Department's proposed transfer of the permit to IP that she was

filing it pursuant to Sections 120.569 and 120.57, Florida

Statutes. These statutes provide standing in this proceeding

only if Lane's "substantial interests" are being determined by

the Department in the proceeding. Section 120.569(1), Florida

Statutes (2000). Lane has the burden of showing, as a matter of

fact, that she will be substantially and adversely affected if

the Department transfers the permit for the facility to IP. The

purpose of this standing requirement is . . . "to ensure that a

party has a 'sufficient interest in the outcome of the

litigation which warrants the court's entertaining it' and to

assure that a party has a personal stake in the outcome so [s ]he

will adequately represent the interest [s]he asserts." Gregory

v. Indian River County , 610 So. 2d 547, 554 (Fla. 1st DCA

1992)(citation omitted).

76. To demonstrate that the Department's proposed transfer

of the permit will affect her "substantial interest," Lane must

present facts showing the degree and nature of her alleged

interest in the agency action. Lane must show she "will suffer

injury in fact which is of sufficient immediacy to entitle [her]

to a section 120.57 [fact-finding hearing and that her]

substantial injury is of a type or nature which the proceeding

is designed to protect." Agrico Chemical Co. v. Department of

Environmental Regulation , 406 So. 2d 478, 482 (Fla. 2d DCA

1981), rev . denied , 415 So. 2d 1359 (Fla. 1982) and 415 So. 2d

1361 (Fla. 1982).

77. In order to properly apply the test set forth in

Agrico , "both the type and nature of the injury asserted, and

the purpose and scope of the administrative proceeding" must be

analyzed. Friends of the Everglades, Inc. v. Board of Trustees

of the Internal Improvement Trust Fund , 595 So. 2d 186, 189

(Fla. 1st DCA 1992). "The nature of the injury which is

required to demonstrate standing will be determined by the

statute which defines the scope or nature of the proceeding."

Id.

78. At hearing, Lane admitted the Department is not making

any changes to existing permit conditions before transferring it

to IP. Lane agreed that changing the name on the permit from

Champion to IP will have no adverse affect on her. Lane brought

this proceeding because she is dissatisfied with the manner in

which the Department is enforcing conditions in the facility's

permit. However, Lane did not prove that she has suffered an

"injury in fact" should the permit, and related documents, be

transferred to IP.

79. In view of the above, Lane lacks standing to challenge

the Department's transfer of the permit to IP.

IP Provided Reasonable Assurances of Its Ability to Meet

Permit Conditions

80. The parties agree the relevant test for the transfer

of the permit in this case is set forth in Rule 62-620.340(3),

Florida Administrative Code, and allows the transfer of an

industrial wastewater discharge permit if the proposed permittee

provides reasonable assurances it has the ability to meet the

conditions of the existing permit. See Findings of Fact 6-7.

This is the same substantive test contained in the general rule

for the transfer of permits, Rule 62-4.120(4), Florida

Administrative Code ("ability of the new permittee to comply

with the conditions of the existing permit").

81. IP proved by a preponderance of the evidence that it

has the ability to meet the permit conditions as the Department

construes them. IP is an international company with annual

sales of about $30 billion. It operates other mills with NPDES

permits. The Department is familiar with the management at the

mill. That management is committed to meeting permit conditions

and resolving water quality issues the facility's discharge may

present. IP brings human, financial, and technical resources to

the mill that were previously unavailable. The Department has

worked with IP personnel since June 2000, and thereby observed

the mill's continued support of the Department's concept to

relocate the facility's treated effluent to wetlands on IP's

property.

82. The Department has also observed IP's cooperation with

ECUA on the plan to relocate the discharges of IP's facility and

ECUA's proposed treatment facility to wetlands. In the

Department's view, this is a feasible project that will allow

full compliance by these facilities with the water quality

standards in Chapter 62-302, Florida Administrative Code.

83. In view of the above, IP has established by a

preponderance of the evidence reasonable assurances of its

ability to comply with existing permit conditions of the

facility.

IP Complies with Existing Permit Conditions

84. In view of the evidence submitted at hearing, IP is

complying with permit conditions as the Department reasonably

construes them at this time. In the Department's view, there

have been no exceedances of permit conditions since IP took over

operations of the mill in January 2001. According to expert

testimony presented by the Respondents, IP is in compliance with

the Consent Order, TOP, NPDES permit, and Variance. The monthly

monitoring reports and periodic inspections by the Department

show the facility's effluent has complied with permit

limitations since IP purchased the mill as a wholly owned

subsidiary.

85. The Consent Order provides a time frame for the

facility to come into compliance with water quality standards in

Eleven Mile Creek and Perdido Bay. The Department considers IP

to be meeting the compliance schedule in that order. The

Department has not yet "resolved or agreed on the final

corrective action" for water quality issues in the Consent

Order. In the Department's view, IP is meeting the interim

limits in the permit.

Litigation Costs and Attorney's Fees Should Not Be Assessed

Against Lane

86. Pursuant to Section 120.595(1)(b) and (c), Florida

Statutes (2000), an award of litigation costs, including

reasonable attorney's fees, may be awarded in a Section

120.57(1) proceeding if the administrative law judge finds the

nonprevailing party participated for an "improper purpose"

within the meaning of Section 120.569(2)(e).

87. The definition of "improper purpose" in Section

120.569(2)(e), Florida Statues (2000), includes a "frivolous

purpose or needless increase in the cost of litigation." See

also Section 120.595(1)(e)(1.), Florida Statutes (2000). A

frivolous purpose has been judicially defined as " one which is

of little significance or importance in the context of the goal

of administrative proceedings." Mercedes Lighting and

Electrical Supply, Inc. v. State, Department of General

Services , 560 So. 2d 272, 278 (Fla. 1st DCA 1990).

88. Whether an improper purpose exists is a question of

fact determined by the administrative law judge's review of the

record presented by the parties. Burke v. Harbor Estates

Associates, Inc. , 591 So. 2d 1034, 1037 (Fla. 1st DCA 1991).

See also Mercedes Lighting , 560 So. 2d at 278 (The determination

of improper purpose is based on the record, not a party's

subjective intent.).

89. In this proceeding, Lane stated her purposes at

hearing. See Findings of Fact 64-70. However, and overlooked

by IP, Lane has consistently argued that Champion has in the

past, and IP, is currently violating the current permit

conditions. See , e.g. , Transcript, Volume I, page 14 (". . .

the law says yes, you are providing reasonable assurance that

the conditions of the permit are being met and that is where I

am being injured because they are not—they are not meeting those

conditions in the permit. And I will continue to be injured

until they write a permit that does make this company come into

compliance with the rules of Florida.") Lane also asserted that

IP did not have the ability to comply with the permit

conditions.

90. Lane offered evidence in support of her position.

There are problems with the water quality of the creek and bay

and perhaps these can been solved in the future. However,

Lane's evidence did not sufficiently disprove that IP has the

ability to comply with the permit conditions. This does not

mean, however, that Lane proceeded with an improper purpose and

no such improper purpose is found.

RECOMMENDATION

Based on the foregoing Findings of Fact and Conclusions of

Law, it is recommended that a final order be rendered as

follows:

1. Lane lacks standing to challenge the transfer of

industrial wastewater permit number FL0002526-002-IWF/MT to IP

because Lane did not prove that her substantial interests were

being determined by the Department's transfer of the permit from

Champion to IP;

2. IP provided reasonable assurances it has the ability to

comply with the conditions of industrial wastewater permit

number FL0002526-002-IWF/MT;

3. IP has complied with the conditions of industrial

wastewater permit number FL0002526-002-IWF/MT, as the Department

construes those conditions, since assuming control of the mill

on January 1, 2001; and

4. Lane did not participate in this administrative

proceeding for an improper purpose.

DONE AND ENTERED this 24th day of August, 2001, in

Tallahassee, Leon County, Florida.

___________________________________

CHARLES A. STAMPELOS

Administrative Law Judge

Division of Administrative Hearings

The DeSoto Building

1230 Apalachee Parkway

Tallahassee, Florida 32399-3060

[phone] SUNCOM 278-9675

Fax Filing [phone]

www.doah.state.fl.us

Filed with the Clerk of the

Division of Administrative Hearings

this 24th day of August, 2001.

COPIES FURNISHED:

Jacqueline M. Lane

10738 Lillian Highway

Pensacola, Florida 32506

Terry Cole, Esquire

Patricia A. Renovitch, Esquire

Oertel, Hoffman, Fernandez & Cole, P.A.

Post Office Box 1110

301 S. Bronough Street, Fifth Floor

Tallahassee, Florida 32302-1110

Craig D. Varn, Esquire

Department of Environmental Protection

3900 Commonwealth Boulevard

Mail Station 35

Tallahassee, Florida 32399-3000

Kathy C. Carter, Agency Clerk

Office of General Counsel

Department of Environmental Protection

3900 Commonwealth Boulevard, Mail Station 35

Tallahassee, Florida 32399-3000

Teri L. Donaldson, General Counsel

Department of Environmental Protection

3900 Commonwealth Boulevard, Mail Station 35

Tallahassee, Florida 32399-3000

David B. Struhs, Secretary

Department of Environmental Protection

3900 Commonwealth Boulevard

The Douglas Building

Tallahassee, Florida 32399-3000

NOTICE OF RIGHT TO SUBMIT EXCEPTIONS

All parties have the right to submit written exceptions within

15 days from the date of this Recommended Order. Any exceptions

to this Recommended Order should be filed with the agency that

will issue the Final Order in this case.