In the Matter of Hibbing Taconite Mine and Stockpile Progression and Williams Creek Project Specific Wetland Mitigation.
Department of Natural Resources OAH Docket No. 11-2004-31655.
Affirmed in part, reversed in part, and remanded. Reilly,
W. Von Korff, John C. Kolb, Rinke Noonan, St. Cloud,
Minnesota (for relator Lake of the Woods County)
Swanson, Attorney General, Max Kieley, Assistant Attorney
General, St. Paul, Minnesota (for respondent Department of
K. Wiens, William P. Hefner, The Environmental Law Group,
Ltd., Minneapolis, Minnesota (for respondent Cliffs Natural
Considered and decided by Reilly, Presiding Judge; Halbrooks,
Judge; and Johnson, Judge.
authority of the commissioner of natural resources, under
Minnesota Statutes section 103G.222 (2014), to approve
wetlands replacement for activities requiring a permit to
mine does not include the authority to approve the
reservation of wetland credits for future use by a
permit-to-mine applicant without deposit into the state
certiorari appeal, relator county challenges a final order
affirming respondent administrative agency's approval of
respondent mine operator's wetland replacement plan. We
affirm in part, reverse in part, and remand.
January 2014, respondent Cliffs Natural Resources Inc.
(Cliffs) submitted to respondent Minnesota Department of
Natural Resources (DNR) an application for approval of a
wetland replacement plan (the plan or the Cliffs's plan)
proposing the restoration of about 432 acres of wetlands at a
specified site in Lake of the Woods County (the LOW site).
The plan stated that the LOW site was projected to produce
approximately 443.34 wetland credits, 14.29 of which were
designated for mitigation of wetland impacts of mine
progression and stockpile development at Cliffs's mining
operation, Hibbing Taconite, and the balance of which were
"to be held for future use" to mitigate wetland
impacts of any of Cliffs's mining operations'
"potential future" activities requiring a permit to
mine (PTM). The plan was entitled "Project-Specific
Wetland Replacement Plan Hibbing Taconite Mine and Stockpile
Progression Project" and was submitted by Cliffs to DNR
pursuant to its authority to approve wetland-replacement
actions in connection with activities requiring a PTM.
See Minn. Stat. § 103G.222, subd. 1(a) (2014);
Minn. R. 8420.0200, subp. 1.D, .0930, subp. 1 (2015).
Lake of the Woods County (the county) and others submitted to
DNR comments opposing Cliffs's plan based on
"numerous technical issues and its inconsistency with
the Wetland Conservation Act." The county also asserted
that the plan, despite its title, was not a wetland
replacement plan subject solely to DNR approval, but rather a
wetland banking plan subject to specific regulatory
requirements and oversight by the Minnesota Board of Water
and Soil Resources (BWSR). See Minn. Stat. §
103G.2242, subd. 9 (2014); Minn. R. 8420.0700-.0820 (2015).
issued a notice of decision approving the plan as a
replacement plan and directing that "any person
aggrieved by this decision may appeal the decision in the
manner provided for a contested case hearing." The
county both petitioned DNR for contested-case proceedings and
submitted an appeal to BWSR, asserting that the proper avenue
of review was the appeal to BWSR. BWSR held the county's
appeal in abeyance, and DNR ordered contested-case
proceedings before the Minnesota Office of Administrative
Hearings (OAH) to adjudicate three issues:
1. Was the Commissioner's approval of [the Cliffs's
plan] issued in conjunction with a valid [PTM] and an
approved mining reclamation plan pursuant to the requirements
of Minn. Stat. § 103G.222, subd. 1 (2012)?
2. If there are surplus wetland mitigation credits developed
by Cliffs [under its plan], can they be used to mitigate
mining-related wetland impacts at Cliffs' mining
operations . . . pursuant to Minn. R. 8420.0930, subp. 4A
(2013) without being deposited in a state wetland bank?
3. Did the Commissioner have cause to approve [the
Cliffs's plan] pursuant to Minn. Stat. § 103G.222,
subd. 1 (2012) and Minn. R 8420.0930 (2013)?
successfully petitioned to intervene and brought a motion to
dismiss the contested-case proceedings for lack of
jurisdiction or, alternatively, to limit the proceedings to
review on the administrative record. Both the county and DNR
opposed Cliffs's motion to dismiss or to limit the
proceedings, and the administrative-law judge (the ALJ)
denied the motion.
moved for partial summary disposition, which Cliffs supported
and the county opposed. The ALJ issued an order recommending
summary disposition in favor of DNR on Issues 1 and 2, and
the parties entered into a settlement agreement resolving
Issue 3. The ALJ issued an order recommending dismissal of
the contested-case proceedings, in light of the partial
summary-disposition recommendation and the parties'
receiving written arguments, the commissioner of natural
resources (the commissioner) issued a final order adopting
with modification the ALJ's order denying Cliffs's
motion to dismiss the contested-case proceedings for lack of
jurisdiction and recommending summary disposition in favor of
DNR on Issues 1 and 2; adopting without modification the
ALJ's order recommending dismissal of the contested-case
proceedings; and affirming DNR's notice of decision
approving the plan as modified by the settlement agreement.
The final order includes a conclusion that "excess
wetland credits from [wetland restoration at] the [LOW] site
[may] be used to replace future mining-related [wetland]
impacts from mining operations under a [PTM] that is held by
county appeals, arguing that DNR lacked jurisdiction to
initiate contested-case proceedings and exceeded its
authority in approving the plan.
the county waive or forfeit the issues raised on appeal?
DNR exceed its statutory authority in approving Cliffs's
appeal requires us to examine the nature and extent of
DNR's authority under the Minnesota Wetland Conservation
Act (WCA), Minn. Stat. §§ 103G.221-.2375 (2014),
which was adopted by the legislature in 1991 for the purpose
of preserving and restoring Minnesota wetlands. See
Minn. Stat. § 103A.201 (2014); Drum v. Minn. Bd. of
Water & Soil Res., 574 N.W.2d 71, 73 (Minn.App.
1998). WCA requires that "[w]etlands must not be drained
or filled, wholly or partially, unless replaced by actions
that provide at least equal public value under a replacement
plan." Minn. Stat. § 103G.222, subd. 1(a). WCA is
primarily administered by BWSR in cooperation with soil and
water conservation districts and other local government units
(LGUs). Drum, 574 N.W.2d at 73-74; Minn. Stat.
§ 103G.005, subd. 10e (2014) (defining local government
unit). Generally speaking, to engage in activities
potentially impacting wetlands, one must apply to the