IN RE: Goemaere-Anderson Wetland Protection Act
Appeal of A-1 Auto Parts
File No. 89-11-53
At a session of the

The Proposal for Decision, Cause No. 89-11-0053, dated May 25, 1990, is incorporated into this final decision by the Department of Natural Resources as its finding of fact and conclusions of law with the following exceptions.

The Natural Resources Commission finds as a matter of fact that a feasible and prudent alternative to the loss of the 0.3 to 0.4 acres of wetlands is to mitigate for that loss. It is the finding of the Commission that mitigation in the form of constructing replacement wetlands either on or off site is a feasible and prudent alternative.

It is ordered:

A permit may be issued the petitioner as applied for subject to the petitioner constructing a mitigation area of 0.3 acres or more, either on or off site, in accord with requirements of the Land and Water Management Division, and under the supervision of said Division so as to assure optimum future performance of the area as a functional wetlands.

____________________________ ______________________________

Date Thomas J. Anderson, Chairman
Natural Resources Commission

In Re: Wetland Protection Act
Appeal of A-1 Auto Parts Cause No. 89-11-0053
___________________________________/
PROPOSAL FOR DECISION

Frederick J. Griffith
Administrative Law Judge

I. JURISDICTION

The hearing in this case was conducted pursuant to the Goemaere-Anderson Wetland Protection Act, 1979 PA 203, MCL 281.701, et seq.

II. PARTIES

The professional staff of the Department of Natural Resources (hereafter "Department") is charged with the day to day implementation of the Goemaere-Anderson Wetland Protection Act.

Petitioner A-1 Auto Parts (hereafter "Petitioner") requested the hearing in this cause pursuant to Section 17 of the Wetlands Act.

III. FACTUAL BACKGROUND

Petitioner operates an automotive parts and salvage business on leased premises located at 3902 South Canal Road, Lansing, Michigan. In 1988, the Michigan Department of Transportation condemned a portion of the leased premises for highway purposes. Approximately two (2) acres of the condemned tract confiscated was an area which A-1 used for auto and tire storage purposes. See Petitioner's exhibit K.

On February 15, 1989 Petitioner, having been informed by the Department that wetlands were involved, filed an application to dredge and fill another tract on its property which was adjacent to the existing auto storage area. Petitioner sought to replace the two acre storage area which was taken by MDOT. Discussions between Petitioner's agents and Department personnel occurred and the area of wetland involved in Petitioner's proposal was revised. Pursuant to the revision, the area of wetland involved was reduced from .7 to .3 -  .4 of an acre. In addition, the amount of fill involved was substantially reduced (from 4,000 cubic yards to 1,300 cubic yards). Respondent's exhibit 2, attachment.

The Department issued its decision letter denying Petitioner's application on May 15, 1989. See text quoted in 11, infra. Petitioner filed a petition for contested case hearing on July 13, 1989.

The position of the Department in this case is essentially outlined as follows in the Department's decision letter of May 15, 1989:

After due consideration of the permit application, onsite investigation 'and other pertinent materials, the Department finds that the proposed project will have a significantly adverse impact on the natural resources associated with the scrub/shrub wetlands contagious (sic) to Dann Drain. The subject wetland filters runoff removing nutrients and other contaminants prior to their introduction into Dann Drain. This filtration is accomplished by a combination of natural processes such as physical entrapment, microbial transformation, and biological utilization. The Department finds the proposed demucking, backfill, and drainage tile would harmfully alter the filtration benefits of the wetland area proposed to be filled.

The wetland area provides breeding, loafing, cover, feeding, and nesting habitat for a variety of marsh birds and waterfowl, escape cover and breeding habitat for furbearers, and cover and feeding habitat for upland wildlife species. This area also provides valuable production habitat for reptiles, amphibians, and macroinvertebrates which are a vital part of the food web. These values would be adversely impacted by the proposed demucking, backfilling, and drainage tile.

Rule 4 (R 281.814) of the Administrative Rules for the Inland Lakes and Streams Act,supra, states, in pertinent part: a permit shall not be issued unless.....

a. The adverse effects to the environment and the public trust are minimal and will be mitigated to the extent possible.
b. The resource affected is not a rare resource.
c. The public interest in the proposed development is greater than the public interest in the unavoidable degradation of the resource.
d. No feasible and prudent alternative location is available.

The Department finds that:
a. The adverse effects to the environment and the public trust are not minimal nor are they mitigated to the extent possible.
b. The public interest in the proposed development is not greater than the public interest in the unavoidable degradation of the resource.
c. That a feasible and prudent alternative is available.

Section 9(l) of the Goemaere-Anderson Wetland Protection Act,supra, states, in pertinent part: "A permit . . . shall not be approved unless the Department determines that the issuance of a permit is in the public interest . . ."
Section 9(4) states, in pertinent part:

"A permit shall not be issued unless it is shown that an unacceptable disruption will not result to the aquatic resources. A permit shall not be issued unless the applicant also shows either of the following:
a. The proposed activity is primarily dependent upon being located in the wetiand.
b. A feasible and prudent alternative does not exist.

The Department finds that:

a. The proposed project is not in the public interest in that the benefits which reasonably may be expected to accrue from the proposal do not balance the reasonably foreseeable detriments of the activity.
b. The proposed project will cause an unacceptable disruption to the aquatic resources.
c.The activity is not dependent upon being located in the wetland and a feasible and prudent alternative exists.

Section 5(2) of the Michigan Environmental Protection Act states, " In any such administrative, licensing, or other proceedings, and in any judicial review thereof, any alleged pollution, impairment, or destruction of the air, water, or other natural resources or the public trust. therein, shall be determined, and no conduct shall be authorized or approved which does, or is likely to have such effect so long as there Is a feasible and prudent alternative consistsent (sic) with the reasonable requirements of the public health, safety, and welfare".

In consideration of the statutory provisions as noted above, the Department has determined that although the resources involved are not rare, the adverse impacts to the environment and public trust are significant, and they have not been migitated (sic) to the extent possible. We further find that there is no public interest in the proposed project and there is a public interest in unavoidable degradation of the resource, and that there are feasible and prudent alternatives.

The Michigan Environmental Protection Act, supra, requires the Department to deny application for activities that will cause pollution, impairment, or destruction to the State's natural resources when there exists a feasible and prudent alternative consistent with reasonable requirements of the public health, safety, and welfare. The Department finds that the proposed project will cause pollution, impairment, or destruction to the State's natural resources and there is a feasible and prudent alternative.

Based on the foregoing findings, a permit cannot be granted to demuck, backfill, and install the drainage tile as proposed into the scrub/shrub wetlands and your application is hereby denied.

Review of your parcel shows that there are existing uplands available which could be used to provide the area (0.3 -0.4 acres) proposed for storage within the wetlands. The Department is aware that you may have preliminary plans for the development of existing uplands beyond their use for salvage vehicle storage. However, that is not sufficient justification for the Department to authorize the filling of the wetlands as you have proposed.

Petitioner continues: The negotiations back and forth between the Department of Natural Resources and Petitioner continued, with additional suggestions being made to cut down the area of the wetland that would be involved. Petitioner complied with every request made by the DNR to work on the proposal which it had initiated and was shocked to find, after a 40 day notice period, that the Department had denied the proposal. Mr. Thomas of the Department indicated that his supervisor had overruled him.

Petitioner continues: Review of the history of the location at issue indicates that the surface water conditions on the premises are man-made, and not a natural condition, resulting from the fact that the Board of Water and Light engineered their property so that its 77 acres was drained across the road to the area at issue. The Board of Water and Light took steps, at one point, to correct the drainage problem and to dry out the property, which was initially a cornfield. The natural resources involved on this tract are not rare. The area of wetland at issue is approximately .3 - .4 of an acre. There are no animals of any kind that are prevalent in this area (note: Petitioner does concede that this area is a wetlands see T, 201). The adverse effects to the environment have been mitigated by the plan orally approved, but subsequently denied, by the DNR. The area at issue is not an area of particular public interest. It is at the back of Petitioner's property and is not accessible to anybody. No feasible alternative sites for the land use intended exist. The area referred to in the denial is not available to Petitioner. It appears that this permit was denied because the Department did not have the right information.

Mr. Les Thomas, a water quality specialist for the Department, testified that on February 17, 1989 he met at Petitioner's property with Tom Kolhoff of the Department to do a wetlands evaluation on the site. This evaluation was an initial evaluation to determine whether submission of a wetlands permit was necessary. On the site he observed that wetland species of plants were evident and that the wetlands were contiguous to the Dann Drain. Mr. Thomas authored the project review report which was issued in this case. T, 28. He specifically noted that the project could potentially affect turbidity, wildlife, and water quality, explaining that the area provided habitat for various animals, including song birds, small fur bearing animals, and possibly raccoons. T, 32. Water quality impacts could exist simply from the construction of the proposed activity due to its direct connection to the drain. Construction activity could also cause erosion and runoff to reach surface waters, therefore causing turbidity.

Mr. Thomas acknowledged that several plans were submitted to him by Petitioner in an effort to decrease the amount of fill and the area of wetland which were affected by Petitioner's proposal. But in working through the plans, Mr. Thomas indicated that he had failed to address the matter of "reasonable and prudent alternatives". The use of the upland became an issue when his supervisor said that the availability of an uplands alternative required denial of a permit. T, 47. In this case there was no consideration of mitigation because the conclusion drawn by the Department was that there were no feasible and prudent alternatives. The attachment to the project review report (Respondent's exhibit 2) was a statement prepared by Mr. Thomas before the project review report was finalized with a denial. T, 60-62 , 80.

Mr. Thomas Kolhoff, a district water quality specialist for the Department, accompanied Mr. Thomas to Petitioner's site to make the initial wetland identification. He acknowledged that the area of wetland in this case is identified on Respondent's exhibit I by yellow markings. By his testimony, Mr. Kolhoff mirrored the testimony of Mr. Thomas in indicating that there was significance to the loss of the .3 or .4 acres of wetland involved in this case. T, 96-99, 105-107.

Ms. Patricia Pemberton testified that with her now deceased husband she owned the property now ]eased to Petitioner on a land contract. One of the provisions of the land contract was that as land contract vendees she must screen the area of auto salvage and not occupy certain land areas near the home of the vendor. T, 110-112. In this case when her son Jody Pemberton, speaking for Petitioner, asked her if she would permit a portion of the leased Premises next to the Gadsden farm (the land contract vendor's farm) to be used for the storage of vehicles she said "No."  She felt obliged to honor the land contract clause and hoped to develop the property in the area in question commercially. This area was identified as "J" on Petitioner's exhibit C. Ms. Pemberton had this area served by sewer and water in view of potential future commercial development. She was unaware that any of the premises was a particular refuge for wildlife. She was aware that Mr. Bolt, the appraiser for the Department of Transportation, had proposed that the vehicles be stored in "J". But in fact, as she explained, "J" was not available and no portion of the premises other than "J" was available. Ms. Pemberton acknowledged that the land contract had been paid off. She did not know if deed restrictions contained the language of reservation which had been contained in the land contract. T, 119. She, furthermore, acknowledged having a legal and financial interest in Petitioner, A-1 Auto Parts. T, 120.

John L. Pemberton ("Jody") testified that physical changes to "J" would have to be made in order to use it for the storage of vehicles. Such changes include the removal of a large berm. T, 121, 122. Mr. Pemberton is president of Petitioner. The drain, which runs from just outside the middle front door of Petitioner's building to the tract where the auto storage area is proposed, flooded routinely up until about six years ago because it had drained substantial Board of Water and Light property across the highway. The latest proposal to the Department was that the auto storage area would affect possibly .3 to .4 of an acre of wetland. This area is marked "K-111 on Petitioner's exhibit C. As a result of the threatened condemnation by the Department of Transportation, Petitioner has had to reduce the number of vehicles it can store by some two hundred vehicles. At this point, Petitioner is just fighting to maintain the operations that it has had. T, 135-137.

Mr. Pemberton continued: The business has already spent over $50,000.00 on bringing a water and sewer line into place with respect to tract "J". It would not make commercial sense to put cars up in that area when an Investment that big had been made. T, 138. The Department of Transportation has made some arrangements to repay Petitioner for a new site and storage of the vehicles, although payment has not been made at this time. T, 138. Mr. Pemberton employed Mr. Maynard Beery to arrange plans with the Department to place a proposal into effect. Through the negotiation process, Mr. Pemberton believed that as soon as the modifications proposed were agreed upon, a permit would be issued. He was very surprised at the Department's denial under these circumstances. T, 140-143. He was convinced there was no other way to get an additional storage area than to impinge on the .3 to .4 area of wetland. If he is unable to get this permit from the Department, he will be unable to store the numbers of vehicles that are required for his business. T, 151. In these circumstances he would have to ask either the Department or the Department of Transportation to buy his business out before all the savings on the business are whittled away. T, 151. In order to obtain the rezoning of the property ("J") for commercial purposes, it is necessary that at least a five acre tract of property be held. T, 159. The owner of the property to the north of Petitioner's property, will not sell a small parcel, but requires the purchase of an entire large tract. T, 164.

Maynard Beery, a soil scientist employed by Petitioner, testified that, in viewing the proposed permit property he observed no serious disruption of aquatic resources. The original plan which Petitioner submitted would have impinged on more than .3 or .4 acres of wetland. Under the circumstances of the negotiation, Mr. Beery was very surprised at the Department's denial. He disagreed that alternatives were available to Petitioner. Petitioner's exhibit C was produced in response to Mr. Pemberton's request to identify such alternatives as were potentially available. Mr. Beery acknowledged the ten foot deep borings of muck taken from the area in the case indicated the development of such muck over a 10,000 to 15,000 year period.

David Lohr, a licensed land surveyor with Beery and Associates, testified that he revised the plans in accordance with Mr. Thomas' request. The last proposal made by Petitioner (See Respondent's exhibit 6) showed the elimination of elevation along the southerly edge of the proposed relocated lot to drop the elevation to lessen the impact of the slope into the wetlands. The plan also eliminated the southern fifty feet of the wetland area by including property to the east of the site proposed. T, 192, 193. Mr. Thomas informed him the permit would be granted. T, 195. He was very surprised at the denial letter which issued on May 15, 1989. In his opinion there was no alternative area for the storage of vehicles.

A. Context of Review

In administrative proceedings, such as this hearing, constitutional issues are not resolved because such resolution must occur, unless by consent of the parties, in the courts of law. Dation v Ford Motor Company, 314 Mich 152 (1946). This hearing, accordingly, cannot consider and resolve the merits of an issue of an alleged unlawful taking except insofar as consideration of such issue is pertinent pursuant to statutory regulation under the Wetlands Act.

In these proceedings Petitioner, as the proponent seeking relief from a decision of the Department, bears the burden of proof Lafayette Market and Sales Company v City of Detroit, 43 Mich App 129, 133 (1972).

B. The Wetlands Act Criteria

Section 9 of the Wetlands Act contains criteria for the review of permit applications and mandates that findings be made regarding each criteria.

Section 9.
(1) A permit for an activity listed in Section 5 shall not be approved unless the Department determines that the issuance of a permit Is in the public interest, that the permit is necessary to realize the benefits derived from the activity, and that the activity is otherwise lawful.

A determination of whether the project is in the public interest is made by applying the criteria discussed In the Wetlands Act. A permit is necessary to engage in the activity requested. The activity requested is otherwise lawful activity.

(2) In determining whether the activity is in the public interest, the benefit which reasonably may be expected to accrue from the proposal shall be balanced against the reasonably foreseeable detriments of the activity. The decision shall reflect the national and state concern for the protection of natural resources from pollution, impairment, and destruction. The following general criteria shall be considered:

(a) The relative extent of the public and private need for the proposed activity.

(b) The availability of feasible and prudent alternative location and methods to accomplish the expected benefits from the activity.

The five acre tract is a portion of property leased to Petitioner by Ms. Patricia Pemberton, who in accordance with the terms of her lease with Petitioner has declined to give permission for constructing any improvement in the nature of an auto storage area in this tract. Ms. Pemberton with evident approval of her son, John Pemberton, the President of Petitioner, intends to sell the five acre tract for commercial development purposes. Sewer and water have been extended to the premises for this purpose. Ms. Pemberton also acknowledges feelings of responsibility to Mr. Gadsden, the landowner adjacent to tract "J" which indicate that she should not place an auto storage use next to his property. A provision to such effect had been expressly embodied in the land contract, now paid off, between the parties. Furthermore, Ms. Pemberton acknowledged that she had a legal and financial interest in Petitioner, A-1 Auto Parts.

The Department's analysis appears to readily disregard the lack of consent of Ms. Pemberton to use of the uplands on tract "J". I cannot so readily disregard this lack of consent. Ms. Pemberton is titleholder of the property with established leasehold rights. Absent a showing of-fraud or unlawful collusion, her assent to availability of the property to Petitioner is required where "improvements" are concerned. See Petitioner's exhibit B, paragraph 8. 1 do not find that fraud or unlawful collusion are established on this record. Tract "J" is not Petitioner's property. In the absence of Ms. Pemberton's consent It is unavailable to Petitioner. Given this fact and others here noted, I find that there are no feasible and prudent alternatives to the revised proposal presented by Petitioner.

(c) The Extent and Permanence of the Beneficial or Detrimental Effects Which The Proposed Activity May Have on the Public and Private Uses to Which the Area is Suited, including the Benefits the Wetland Provides.

(d) The Probable Impact of Each Proposal in Relation to the Cumulative Effect Created by Other Existing and Anticipated Activities in the Watershed.

(e) Probable Impact on Recognized Historical, Cultural, Scenic, Ecological or Recreational Values and on the Public Health of Fish or Wildlife.

(f) The Size of the Wetland Being Considered.

(g) The Amount of Remaining Wetland in the General Area.

(h) Proximity to Waterway.

(i) Economic Value, Both Public and Private, of the Proposed Land Change to the General Area.

Section 9(4) of the Wetland Act requires that Petitioner show "that an unacceptable disruption will not result to the aquatic resources" as a result of Petitioner's undertaking. The statutory language then continues:

In determining whether a disruption to the aquatic resources is unacceptable, the criteria set forth in section 3 and subsection (2) shall be considered. A permit shall not be issued unless the applicant shows either of the following:
(1) The proposed activity is primarily dependent upon being located in the Wetland,
(2) A feasible and prudent alternative does not exist.

It is acknowledged on this record by the Department that no rare resource is here involved. While the obvious adverse effect of loss of an area of wetland is involved in this case, the area involved is small and there are other existing wetlands of greater extent in the immediate vicinity. Petitioner has made significant efforts to cut down the effect of its proposal upon the environment. These efforts led to the following comments by Mr. Thomas, which occurred before the eventual denial of Petitioner's project proposal:

"This proposed fill project is the result of MDOT's condemnation proceedings to acquire 11 acres of property owned by A-1 Auto. MDOT's action is cause for A-1 Auto to develop a new salvage area for storage of autos. This involves about 1.8 acres of salvage area being lost and needing to be relocated. The applicant's first proposal involved the filling of approximately 0.7 acres of scrub/shrub wetland and the direct discharge of storm water runoff into Dann Drain. The original volume of fill into the wetlands was to be about 4,000 cubic yards. Modified plans have reduced the wetland to be filled to about 0.3 - 0.4 acres has reduced the fill volume to about 1300 cubic yards and has deleted the storm water outlet direct discharge from Dann Drain. Such discharge is now proposed for discharge into the existing scrub/shrub complex thereby potentially improving water quality of Dann Drain and enhancing the existing wetlands."  Respondent's exhibit 2, attachment.

1. Petitioner has applied for a permit to engage in activity that requires a permit under the Gomaere-Anderson Wetland Management and Protection Act.

2. For reasons indicated above, I find that the application of Petitioner fulfills the requirements for a permit set forth in the Goemaere-Anderson Wetland Protection Act, 1979 PA 203, MCL 281.701, et seq.

3. For reasons set forth above, I find that Petitioner's application is in compliance with the Michigan Environmental Protection Act, 1979 PA 127, MCL 691.1201, et seq., particularly Section 5(2), which addresses the pertinence of a "feasible and prudent alternative" use.

For reasons set forth above, I recommend that the application of Petitioner, as amended, and eventually denied by the Department, be approved.

Dated:_________________________ ______________________________

Frederick J. Griffith
Administrative Law Judge

A Land Contract
B Lease between Patricia Pemberton and A-1
C Drawing prepared by Berry & Associates
D Letter from Board of Water and Light
El-6 Pictures of the area in question
H Diagram of Board of Water and Light property
I Aerial photograph of subject property
K Report prepared for Mr. Pemberton
[Petitioner's Exhibits F, G, and J were not admitted into evidence.]

1 Blueprint plan
2 Project Review Report
3 Copy of the Public Notice
4 Revision of A-1 Drainage Plan
5 Additional Revision to Plan
6 Additional Revision to Plan
7 Certified Letter to Jody Pemberton
8 Letter dated June 7th, 1989 fran Mr. MacLean
9 Letter dated June 8th, 1989 to Mr. James Kobza

1. The Department's reliance upon regulations, specifically R 281.814, pursuant to the Inland Lakes and Streams Act is misplaced, because that Act is inapplicable where a permit under The Wetlands Act is at issue. MCL 781.706(1).