The Michigan Supreme Court ruled in favor of regulators this week, saying the state’s general permit to govern how large operations are regulated is necessary and doesn’t need to follow the Administrative Procedures Act (APA), Michigan’s law governing how state agencies can issue rules.
Michigan farmers and various agricultural associations called the 5-2 decision “disappointing,” “creative fiction” and “gaslighting producers with its 118-page word game,” among other descriptors.
Conversely, Michigan Attorney General Dana Nessel called it a “significant procedural victory for environmental protection,” noting the administration will “vigorously defend” its position in contested cases.
Issued by EGLE in 2020, the National Pollutant Discharge Elimination System (NPDES) permit for concentrated animal feeding operations (CAFOs) imposed new conditions to lower phosphorus application limits for point-source discharges, which farmers say hampers their ability to provide sufficient nutrients to meet crop needs.
The permit also added new buffer requirements, calling for a 35-foot vegetated buffer and a 100-foot manure application setback from all waterways, which goes beyond federal requirements.
In June 2020, Michigan farmers and various agricultural associations, including Michigan Farm Bureau (MFB), filed a lawsuit against the Michigan Department of Environmental, Great Lakes and Energy (EGLE).
They argued EGLE arbitrarily wrote new rules into the general permit about CAFOs and “went beyond its power in doing so.”
Despite this, the Michigan Supreme Court ruled EGLE’s general permit is not a rule but a license, freeing them up to have greater power over larger livestock operations, ag groups tell Michigan Farm News.
“The scheme they are proposing here is simply untenable,” said Zach Larsen, the Clark Hill attorney defending the plaintiffs. “It would require every single general permit holder to challenge their individual permit decision either on the Certificate of Coverage (COC) or on the individual permit application, and that’s going to be far too costly for individual farms.”
In a majority opinion, Chief Justice Elizabeth Clement found federal and state laws give EGLE the ability to include extra conditions that “are more stringent than these mandatory conditions when EGLE decides those discretionary conditions are necessary to achieve applicable Part 4 waterquality standards.”
“If an agency lacks rulemaking power, any statement of general applicability issued by the agency necessarily lacks the force and effect of law, no matter if the agency has issued it following the APA’s rulemaking procedures,” Clement wrote.
“As a result, neither the general permit in this case nor the discretionary conditions in it could have the force and effect of law, and so they were not rules under the APA.”
However, Clement went on to say that it doesn’t mean that “CAFOs that apply for and receive certificates of coverage under the general permit are not required to comply with the discretionary conditions.”
Justices David Viviano and Brian Zahra dissented with the majority opinion, believing that the 2020 general permit is a rule that “could be challenged.”
“This notion that the 2020 general permit conditions prohibit certain activities that were previously allowed — does not appear to be in serious dispute,” Viviano wrote.
“Indeed, the majority mints two new phrases to distinguish between permit conditions that are required by EGLE or federal regulations, coined ‘mandatory conditions,’” and those that are more stringent than and merely authorized by such regulations, coined “discretionary conditions.”
“The 2020 general permit commands, requires, orders, and dictates what a CAFO must do to obtain coverage under it,” Viviano wrote. “Indeed, EGLE did not expressly argue in this case that the 2020 general permit is non-binding.”
Read the entire Supreme Court opinion.
The Michigan Milk Producers Association, Michigan Pork Producers Association, Select Milk, Dairy Farmers of America, Foremost Farms, Greenstone Farm Credit Services, and Michigan Allied Poultry Association and MFB are among the plaintiffs in the case.
Many industry leaders say producers are fed up with state regulators and won’t know which permit to apply for.
Others worry state-wide producers won’t expand and instead move to nearby states to grow.
“Regulation is the biggest complaint we hear from our producers in Michigan,” said an industry leader who asked to remain anonymous.
“It’s much harder to do business in Michigan.”
MFB and the other farm groups will now decide whether to file a motion to the Michigan Supreme Court to reconsider the case.
“This is a tremendously disappointing decision,” Larsen said. “It feels like we won every issue that was actually in front of the court, yet we lost.”
The 2020 permit is still being reviewed by an administrative law judge to determine if it is based on sound science and environmental policy.
Larsen said it also must adhere to the Supreme Court’s decision that “discretionary conditions in the general permit are necessary to achieve Part 4 water-quality standards or to comply with other applicable laws.”
Justices Viviano and Zahra even predicted: “The confusion and contradictions in the new legal regime created by the majority opinion will have to be sorted out in this case and others for years to come.”
“Given that historically over 92% of CAFOs have been covered by a general permit, the majority’s erroneous decision will surely be to the financial detriment of CAFOs across the state, which will now be required to engage in an uncertain, laborious, and litigious individual permitting process,” Viviano added.
“Indeed, the majority opinion sentences CAFOs (which cannot operate without a permit) to perpetual permitting litigation — including the litigation that will be necessary to parse the majority’s convoluted and confusing opinion.”
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