The definition of "cumulative impact" given in Minn. R. 4410.0200, subp. 11, does not apply to the project-specific "cumulative potential effects" criterion in Minn. R. 4410.1700, subp. 7.
A "cumulative potential effects" inquiry under Minn. R. 4410.1700, subp. 7, requires a Responsible Governmental Unit to inquire whether a proposed project, which may not individually have the potential to cause significant environmental effects, could have a significant effect when considered along with other projects that (1) are already in existence or planned for the future; (2) are located in the surrounding area; and (3) might reasonably be expected to affect the same natural resources.
The Responsible Governmental Unit made an error of law when it determined that "to show a cumulative negative impact [on the environment], there must be reason to believe that each project in itself will at least have a significant negative impact to the environment." Further, the Responsible Government Unit's conclusion that there would be no cumulative impact on the environment was arbitrary and capricious and was not supported by substantial evidence when the conclusion was based only on conclusory statements by the developer.
The opinion of the court was delivered by: Anderson, Paul H Justice
Concurring, Anderson, G. Barry, J.
Heard, considered, and decided by the court en banc.
On July 29, 2003, respondent Kandiyohi County determined that an environmental impact statement (EIS) was not necessary for two gravel pit projects proposed by respondent Duininck Brothers, Inc. Following this determination, appellant Citizens Advocating Responsible Development (CARD), an environmental advocacy group, brought a declaratory judgment action in Kandiyohi County District Court in an effort to overturn the county's determination. CARD moved for summary judgment, which the court granted. The court then ordered that an EIS be completed for the gravel pit projects. The county appealed the decision, and the Minnesota Court of Appeals overturned the district court, concluding that there was substantial evidence supporting the county's decision. Citizens Advocating Responsible Development, et al. v. Kandiyohi County Bd. of Commissioners, 2005 WL 44823 (Minn. App. 2005). CARD then sought review by our court, claiming that the requirement under Minn. R. 4410.1700 (2005) that the county review "cumulative potential effects" should be interpreted according to the definition of "cumulative impact" given in Minn. R. 4410.0200 (2005). CARD also argues that the county, with or without the correct cumulative potential effects analysis, did not fulfill its duty to adequately review the proposed projects' potential for causing significant environmental effects when making the EIS determination. We reverse the court of appeals and remand to the county so that it may make a new EIS determination in conformity with this opinion.
Respondent Duininck Brothers, Inc. planned to open two new gravel pits, the Eagle Lake West pit in Dovre Township and the CA pit in Green Lake Township. Both of these townships are located within the county, which contains large gravel deposits and a significant existing gravel mining industry.*fn1 Under the county's zoning laws, gravel mining requires a conditional use permit and is thus subject to environmental review under the Minnesota Environmental Policy Act. Conditional use permits in the county are granted by the county board. The county was also the "Responsible Governmental Unit" (RGU) in charge of conducting the environmental review of Duininck's application required by the Minnesota Environmental Policy Act. See Minn. R. 4410.0500, subp. 2 (2005).
Duininck first applied for a conditional use permit to open the Eagle Lake West pit in 1998. Duininck later withdrew this application for reasons unrelated to this appeal, but resubmitted it in November 2001. The county denied the conditional use permit application on October 15, 2002, after receiving a recommendation to deny from the county planning board. Duininck then filed an application for a conditional use permit to mine a limited part of the proposed CA pit area.*fn2 The county board reviewed this application in December 2002, heard public comments, and ruled that an Environmental Assessment Worksheet (EAW) was required before the conditional use permit could be granted. By March 2003, Duininck had not yet submitted an EAW, so the county board denied the conditional use permit request.
In April 2003, despite having no conditional use permit applications pending, Duininck submitted EAWs for both the Eagle Lake West and the CA pit proposals. In response to the EAWs, several citizens sent letters raising various environmental concerns, the Minnesota Department of Natural Resources (DNR) sent a letter expressing its concern regarding the possible effects on groundwater, and the Minnesota Pollution Control Agency (MPCA) sent a letter regarding its dissatisfaction with the level of detail in the EAW and requesting additional clarification on several of the EAW items. The county followed up by consulting with the Well Division of the Minnesota Department of Health, the Kandiyohi County Director of Environmental Services, and by obtaining responses from Duininck on the areas of environmental concern. After reviewing the accumulated information, the county decided that neither proposal required an EIS.
The record before us contains documents entitled "Supplemental Submittal Response to Public Comments For: Environmental Assessment Worksheet" for the Eagle Lake West and CA pits. These documents appear to be the county's responses to public concerns regarding the environmental effects of the gravel pits and a general explanation of the county's EIS determinations regarding the pits. The record does not contain the minutes of any county board or planning board meeting at which the EIS determination was discussed. After the county declined to order an EIS, Duininck submitted conditional use permit applications for the pits, both of which were granted in November of 2003.
CARD appealed to the district court under Minn. Stat. § 116D.04, subd. 10 (2004), for a declaratory judgment overturning the county's decision. CARD claimed that the county had not fulfilled its obligation to consider and weigh the environmental concerns noted by citizen groups, neighbors, and, to a certain degree, the MPCA and the DNR. These concerns included possible erosion, air pollution, and the insufficiency and inapplicability of the proposed mitigating efforts. CARD also claimed that the county failed to use the correct standard for analyzing the cumulative potential environmental effects of the gravel pit projects, and therefore impermissibly failed to consider whether the proposed gravel pits would have significant environmental effects in light of the fact that there are several other gravel pits in the area.
The district court reversed the county's decision and concluded that an EIS was required. The court found that the county had not sufficiently considered or responded to the environmental concerns raised by CARD, concerned citizens, the MPCA, and the DNR. The court then ordered that an EIS be completed. On appeal, the court of appeals reversed the district court. The court of appeals held that the county's decision was supported by substantial evidence and was not arbitrary or capricious. CARD appealed and we granted review.
CARD alleges that the county did not use the correct meaning for "cumulative potential effects" and thus did not apply the appropriate standard in determining whether the proposed gravel pits had the potential to cause significant environmental effects. More particularly, CARD asserts that when the county made its decision it should have used the "cumulative impact" definition given in Minn. R. 4410.0200 for "cumulative potential effects." We disagree. Our analysis of the framework and language of chapter 4410 leads us to the conclusion that the definition for "cumulative impact" in Minn. R. 4410.0200 does not apply to "cumulative potential effects" as used in Minn. R. 4410.1700.
A. Overview of the Minnesota Environmental Policy Act
The Minnesota Environmental Policy Act (MEPA) requires that governmental agencies contemplating taking action (e.g., issuing a conditional use permit) on a proposed project must first consider the project's environmental consequences.*fn3 Minn. Stat. § 116D.04, subds. 1a(d), 2a (2004), Minn. Ctr. for Envtl. Advocacy v. Minn. Pollution Control Agency, 644 N.W.2d 457, 468 (Minn. 2002). Chapter 4410 of the Minnesota Rules contains the rules for environmental review enacted by the Environmental Quality Board (EQB) pursuant to Minn. Stat. § 116D.04. There are two main types of environmental review under MEPA's rules: project-specific review, where a proposed project is reviewed to determine whether it has the potential to cause significant environmental effects; and generic review, where review is ordered by the EQB to study types of projects that are not adequately reviewed on a case-by-case basis. See Minn. R. 4410.1000, 4410.3800 (2005).
The processes for project-specific and generic environmental review are different. For both processes, if an initial environmental review is needed, an RGU is designated to handle the review.*fn4 Minn. Stat. 116D.04, subd. 2a(c); Minn. R. 4410.0500 (2005). But with a project-specific review, the RGU first prepares an EAW, which is described in section 116D.04 as "a brief document which is designed to set out the basic facts necessary to determine whether an environmental impact statement is required for a proposed action." Minn. Stat. § 116D.04, subd. 1a(c) (2004); Minn. R. 4410.1000, subp. 1, 4100.0200, subp. 24 (2005). When preparing the EAW, the RGU applies certain criteria laid out in Minn. R. 4410.1700, subp. 7, to determine whether the project has "potential for significant environmental effects." Minn. Stat. § 116D.04, subd. 2a(c) (2004); Minn. R. 4410.1700, subp. 7 (2005). If, after reviewing the EAW, the RGU decides that the project does have the potential for significant environmental effects, the RGU is required to issue a "positive declaration" indicating that an EIS must be completed. Minn. R. 4410.1700, subps. 1, 3. An EIS is an exhaustive environmental review that the party proposing the project must conduct at its own expense. See Minn. R. 4410.2000, subp. 1; Minn. R. 4410.2300; Minn. Stat. § 116D.045.
For generic EIS determinations, the EQB is the default RGU, and no EAW is completed or used in determining whether a generic EIS is required. Minn. R. 4410.3800, subps. 5-6. The factors which must be considered by an RGU in determining whether a generic EIS is required are found in Minn. R. 4410.3800, subp. 5. These factors are different in number and type from the factors used for project-specific determinations. Compare Minn. R. 4410.3800, subp. 5, with Minn. R. 4410.1700, subp. 7.
B. Language in the "Cumulative Potential Effects" and "Cumulative Impact" Criteria
One of the criteria that an RGU must apply when deciding whether a proposed project has the potential to cause significant environmental effects is the "cumulative potential effects of related or anticipated future projects." Minn. R. 4410.1700, subp. 7(B). Chapter 4410 defines the term "cumulative impact" in Minn. R. 4410.0200, subp. 11,*fn5 but does not define the term "cumulative potential effects." Minn. R. 4410.0200, subp. 11. CARD maintains that the "cumulative impact" definition in subpart 11 should be used to define "cumulative potential effects."
In attempting to determine whether the "cumulative impact" definition should be applied to "cumulative potential effects," we look first to the plain meaning of the words as used in the rule. MBNA America Bank, N.A. v. Commissioner of Revenue, 694 N.W.2d 778, 780 (Minn. 2005). We have noted that the "words of a statute are to be viewed in their setting, not isolated from their context." State v. Anderson, 683 N.W.2d 818, 822 (Minn. 2004) (citing Chiodo v. Bd. of Educ. of Special Sch. Dist. No. 1, 298 Minn. 380, 382, 215 N.W.2d 806, 808 (1974)).
"Cumulative impact" and "cumulative potential effects" are different terms, and the fact that "cumulative impact" is specifically defined in chapter 4410 would appear to indicate that the EQB, which authored chapter 4410, intended to give that term a special and nontransferable meaning. This conclusion is supported by the fact that the language providing the context for "cumulative potential effects" is significantly different from that surrounding "cumulative impact." Minnesota Rules 4410.1700, which articulates the criteria an RGU must use in determining whether an EIS is required for a specific proposed project, contains the term "cumulative potential effects," and reads as follows:
In deciding whether a project has the potential for significant environmental effects, the following factors shall be considered:
A. type, extent, and reversibility of environmental effects;
B. cumulative potential effects of related or anticipated future projects;
C. the extent to which the environmental effects are subject to mitigation by ongoing public regulatory authority; and
D. the extent to which environmental effects can be anticipated and controlled as a result of other available environmental studies undertaken by public agencies or the project proposer, including other EISs.
Minn. R. 4410.1700, subp. 7 (emphasis added).
On the other hand, the term "cumulative impact" appears in Minn. R. 4410.3800, which contains the criteria that the RGU*fn6 must consider when deciding whether a generic EIS is warranted:
In determining the need for a generic EIS, the EQB shall consider:
A. if the review of a type of action can be better accomplished by a generic EIS than by ...