STATE OF WISCONSIN CIRCUIT COURT ST. CROIX COUNTY
TOWN OF FOREST,
Petitioner,Case No.: ______________
Class Code: 30607
v.(Administrative Agency Review)
PUBLIC SERVICE COMMISSION OF WISCONSIN,
PETITION FOR JUDICIAL REVIEW
The Town of Forest, Petitioner, hereby petitions this Court for review of a Final Decision on Remand issued by the Public Service Commission of Wisconsin (Commission), Respondent, on August 11, 2016, which granted a Certificate of Public Convenience and Necessity to Highland Wind Farm, LLC for construction of an industrial wind energy complex in the Towns of Forest and Cylon, St. Croix County, Wisconsin. Petitioner submits this Petition pursuant to Wis. Stat. 227.52 and respectfully requests that this Court reverses or sets aside the Commissions decision and remands it for further consideration.
1.Petitioner Town of Forest is a political subdivision of the State of Wisconsin, organized pursuant to Chapter 60, Wisconsin Statutes, and located in St. Croix County, Wisconsin.
2.Respondent Public Service Commission of Wisconsin is an administrative agency of the State of Wisconsin, organized pursuant to Chapter 196, Wisconsin Statutes, and tasked with regulating industrial wind energy complexes designed for nominal operations at a capacity of 100 megawatts or more.
I.Previous Judicial Review and Remand
3.This matter involves the consideration of a Certificate of Public Convenience and Necessity for a wind energy project requested by Highland Wind Farm, LLC to be constructed in St. Croix County. The project would include between 41 and 44 wind turbines with a maximum output of 102.5 megawatts.
4.On March 15, 2013, the Commission denied the CPCN for the project. The Commission noted:
The Highland project, based upon the design as presented and the accompanying modeling in this record, is not in the public interest and would create undue adverse impacts on public health and welfare, and individual hardships because there are multiple nonparticipating residences where Highland has failed to demonstrate compliance with the Wis. Admin. Code PSC 128.14(3) nighttime audible noise limit of 45 dBA (A-weighted decibels).
Final Decision, p. 6 (Exhibit D).
5.On October 25, 2013, upon reopening the Final Decision, the Commission granted the CPCN after determining that it would apply a 95% compliance standard. The Commission also adopted a proposal by Highland Wind Farm, LLC, extending protections to six sensitive residences by requiring that the project limit nighttime noise emissions to 40 dBA for those residences. See Final Decision on Reopening (Exhibit C).
6.On January 10, 2014, the Town of Forest petitioned this Court for judicial review of the October 25, 2013 Final Decision on Reopening, in Case Number 2014-CV-000018.
7.On August 27, 2015, the Court issued the Decision and Order in Town of Forest v. Pub. Serv. Commn of Wis., No. 14-CV-18 (Wis. Cir. Ct. St. Croix Cnty Aug. 27, 2015) remanding the Commissions Final Decision granting a CPCN to Highland Wind Farm, LLC (Highland) on the issues of a percentage-based compliance standard and whether the Commission should extend the 40 dBA nighttime noise standard applied to six residences to any other sensitive residences previously identified.
II.Commissions Final Decision on Remand
8.On March 15, 2016, the Commission issued an Order to Reopen, Notice and Request for Comments on the remand from the Courts Decision and Order (Exhibit B). The Commission provided an opportunity to be heard on three matters:
i.The Commissions intention to modify its Final Decision on Reopening to remove the pre-established 95 percent compliance standard and address any complaints concerning alleged noncompliance with the noise standards, based on the specific factual situation, at the time any noncompliance is alleged.
ii.To allow the parties to state why the six identified potentially sensitive residences, and other potentially sensitive residences already identified in Ex.-Forest-Junker-20, should be considered for lower noise requirements than is provided for in Wis. Admin. Code PSC 128.14(3), so that the Commission can decide whether to include lower noise requirements for either these six or any additional residences.
iii.To take official notice under Wis. Stat. 227.45 of certain governmental reports of peer-reviewed studies, relating to whether any identified health concerns are affected by wind electric generation facilities, and provide the parties an opportunity, as required by Wis. Stat. 227.45, to rebut or present countervailing evidence.
9.On August 11, 2016, the Commission granted the CPCN again in its Final Decision on Remand. The Commission responded to the remand by declining to hold a hearing on the percentage-based compliance standard or the 40 dBA nighttime protections for the six sensitive residences, and further decided to remove those protections for the six sensitive residences through its amended order. See Final Decision on Remand (Exhibit A).
10.The Commission held in its Findings of Fact that [i]t is reasonable to require Highland to comply with the noise limits in Wis. Admin. Code PSC 128.14(3) for all nonparticipating residences in the project area. Id. at p. 6.
11.The Commission further determined in its Conclusions of Law that no hearing was required to remove the pre-established 95 percent compliance standard or to remove the protections extended to the six sensitive residences. Id. at p. 7.
III.Post-Construction Curtailment as Design Factor
12.On May 14, 2013, when the Commission ordered the reopening of the CPCN Petition, Commissioner Nowak dissented and noted as follows in her dissent:
The applicant interprets Wis. Admin. Code PSC 128.14(2)-(4) to allow curtailment as a design factor, meaning curtailment can be used in the design phase of the project to show compliance with applicable noise standards. Under that interpretation, changing the curtailment parameters would amount to a project redesign. I do not necessarily agree with this interpretation.
Order to Reopen, 5/14/13, Dissent at p. 3, fn 1.
13.On June 25, 2013, the Commission directed the parties to address whether PSC 128 allows curtailment: (i) as a design factor; (ii) only if the project is found to be out of compliance after it is built but not during the project planning phase; or (iii) at any time. Order to Modify Second Prehearing Conference Memorandum, 6/25/13, p. 1.
14.In the Final Decision on Reopening, after receiving the arguments on curtailment from the parties, the Commission held the following:
While Highland may have the better legal argument, it is not necessary for the Commission to address this issue. Regardless of how one interprets Wis. Admin. Code PSC 128.14, these provisions do not control a CPCN application. Under Wis. Admin. Code 128.02(3), the Commission need only consider the Wind Siting Rules when evaluating a CPCN statute. Here the Commission concludes that curtailment is an appropriate planning strategy without regard to the rules.
Final Decision on Reopening at p. 22 (emphasis added).
15.Commissioner Nowak again dissented in the Final Decision on Reopening, and stated as follows:
In the reopened proceeding, Highland submitted a plan that requires curtailment in order to meet the sound limits in Wis. Admin. Code PSC 128.14. While the Commission did not explicitly decide the issue, I am not convinced that Wis. Admin. Code ch. PSC 128 contemplated the type of curtailment plan proposed by Highland as a method for permanent compliance with sound limits. I think the use of curtailment in the manner proposed by Highland undermines the sound limits that were discussed at length and vetted by the Wind Siting Council.
Final Decision on Reopening, Dissent at pp. 1-2 (emphasis added).
16.In the Final Decision on Remand, the Commission states that it specifically concluded that curtailment is an appropriate strategy to meet the noise limits, and Highlands proposed curtailment plan ensured compliance with the applicable daytime and nighttime noise limits. Final Decision on Remand at pp. 20-21. The Commission cited to its statements made in the Final Decision on Reopening at p. 22, found in 14 of this Petition, as support for this statement.
17.Pursuant to Wis. Stat. 196.491(3)(j), any county, municipality, or town having jurisdiction over land affected by a CPCN obtained under Wis. Stat. 196.491(3)(a)(1) may petition for judicial review of a decision to issue the CPCN under Wis. Stat. Ch. 227.
18.The Town has jurisdiction over the land that will be directly affected by the Commissions approval of this CPCN. The Project poses a significant risk to the health and safety of Town residents, the value of properties within the Town, and the Towns environment. The Town therefore has standing under Wis. Stat. 196.491(3)(j) to petition for review of the Commissions decision.
GROUNDS FOR RELIEF
19.This Court may review and remand the Commissions Final Decision on Remand if it determines that the Commission has failed to follow prescribed procedure or made a material error in procedure, or if the agency has erroneously interpreted a provision of law. Wis. Stat. 227.57(1)-(10).
I.The Commission erroneously interpreted its obligations under Wis. Stat. 196.491(3)(dg) to consider the requirements of Wis. Admin. Code PSC Ch. 128 when issuing a CPCN.
20.In the previous Petition for Review in this matter, the Commission determined that Highland would be subject to a 95 percent compliance standard, meaning that Highland would be considered in compliance with the applicable noise limits if it was in actual compliance at least 95 percent of the time. Final Decision on Remand, p. 35. This compliance standard was removed by the Court during the previous review, and the Commission now approves the project where the only mechanism to ensure design-phase compliance is through application of post-construction curtailment.
21.The Commission has consistently evaded a determination of whether Wis. Admin. Code Ch. PSC 128 allows for post-construction curtailment to be used as a design factor during the pre-construction compliance showing. See id. at p. 22. The Commission instead interpreted its obligation sunder Wis. Stat. 196.491(3)(dg), which states that the Commission shall consider whether installation or use of the facility is consistent with the standards specified in the rules promulgated by the commission, as allowing it to make a separate determination regarding the project without regard to the rules of Ch. PSC 128. Id.
22.The Commission now relies on an erroneous reading of its obligations to consider its own rules when granting a CPCN to determine that it needs only consider the Wind Siting Rules when evaluating a CPCN statute. Id. The correct interpretation of the statute, and Wis. Admin. Code PSC 128.02(3), which mirrors the consider language, is that the Commission must abide by the requirements it establishes, as part of a statewide uniform regulatory system, when considering a CPCN. The Commission may only disregard its own rules in Ch. PSC 128 if it specifically identifies exceptional or unusual situations meriting greater or lesser requirements on individual wind energy systems, as authorized by Wis. Admin. Code PSC 128.02(4). To summarize, the Commission has erroneously interpreted the statutes as allowing it to make determinations about wind energy CPCNs without regard to its own wind siting rules. It now approves this project under the same conditions that it originally denied the CPCN as not complying with the nighttime noise requirements of Wis. Admin. Code PSC 128.14(3).
23.The Commission made a material error of law and procedure by determining that Ch. PSC 128 does not control its CPCN determinations, despite finding as a matter of fact in its Final Decision on Remand that [i]t is reasonable to require Highland to comply with the noise limits in Wis. Admin. Code PSC 128.14(3) for all nonparticipating residences in the project area. Final Decision on Remand at p. 6. By selectively applying the noise requirements of Ch. PSC 128 to Highland, but not to the Commissions own determinations regarding compliance under that section, the Commission attempts to avoid its procedural obligations to identify an unusual or exceptional situation meriting variance from the rules.
24.The Commission made a material error of law and procedure by interpreting its obligations to consider the wind siting rules for a CPCN as meaning that the Commission was not bound by those wind siting rules, absent a showing of exceptional or unusual circumstances, and could set requirements for Highland without regard to those rules. This contravenes the Commissions previous interpretation of the applicability of Ch. PSC 128 to CPCN applications for wind energy systems. The Commissions own Report to the Legislature on the creation of Wis. Admin. Code Ch. PSC 128 identified the need for uniform standards across the state and place limits on the ability of the Commission to vary from those rules. See Report to the Legislature, Docket 1-AC-231, 8/31/2010 (Exhibit E).
25.The Commission noted the importance of uniform statewide standards in its Report to the Legislature, stating:
Over time, a patchwork of local wind system ordinances has developed, with varying requirements. The rule helps establish uniform standards about the construction and operation of wind energy systems in the state by specifying what political subdivisions can and cannot include in ordinances regulating wind energy systems. It also specifies requirements for applications, political subdivision review of an application and decommissioning of a wind energy system.
Id. at p. 1. The Commission also promulgated Wis. Admin. Code PSC 128.02(4), the rule allowing for variances based on unusual or exceptional circumstances, as a mechanism for allowing it to deviate when necessary from the rules:
This flexibility is important given the very quick changes that can occur in the industries regulated by the commission, especially in a developing area such as wind energy. Further, this rule is unique in its inter-relationship between political subdivisions and the commission. Unusual complications may arise as a result of this. The provision is not open-ended. The commission must examine the facts and circumstances of an individual case and can only change requirements if there is an unusual or exceptional circumstance.
Id. at p. 14 (emphasis added).
26.The Commissions interpretation of Wis. Stat. 196.491(3)(dg) to consider its wind siting rules when granting a CPCN is a material legal error, as its interpretation would constitute an impermissible delegation of legislative authority to the Commission. To clarify, the Petitioner does not allege that the statute itself is unconstitutional. We argue that the Commissions interpretation is legally erroneous as it interprets the statute in a way that would render it unconstitutional. A delegation of legislative power to a subordinate agency will be upheld if the purpose of the delegating statute is ascertainable and there are procedural safeguards to insure that the board or agency acts within that legislative purpose. Gilbert v. State, Medical Examining Bd., 119 Wis.2d 168, 186, 349 N.W.2d 68 (1984), citing Watchmaking Examining Bd. V. Husar, 49 Wis.2d 526, 536, 182 N.W.2d 257 (1971).
27.As discussed above, the purpose of the delegating statute was to provide a uniform statewide regulatory scheme for wind energy systems. There is no procedural safeguard under the Commissions interpretation that would obligate it to act within that legislative purpose. To the contrary, the Commission argues that it can deviate from its own rules at its discretion, without following the exceptional circumstance procedure promulgated by Wis. Admin. Code PSC 128.02(4), as long as it merely considers the rules. This creates a situation wherein the Commission could approve a CPCN that does not meet the regulatory requirements, as it did here, because at least the Commission considered the fact that the project does not meet the requirements. This determination presumes such great discretionary authority that there is no situation where the Commission could be in abuse of that discretion, as long as it makes a cursory nod towards the fact that regulations did exist. Such an interpretation allows the Commission to deviate from its own rules without any procedural safeguards, contravening the legislative intent of creating a statewide uniform standard, and is consequently an error of law as based upon an erroneous and unconstitutional interpretation of the statute.
28.The Commission promulgated its exceptional circumstance rule as the mechanism by which it can deviate from its own rules when reviewing a CPCN. It now attempts to escape from its procedural obligations by claiming an overbroad discretionary authority to merely consider the rules, ignoring its own previous interpretation of its obligations, its own decision that the rules should apply in this case, and whether such a delegation of discretionary authority is even permissible. The Commission errs as a matter of law by claiming that it is not bound by its own rules. By invoking this erroneous interpretation, the Commission now attempts to grant a CPCN where compliance is demonstrated only by curtailment, despite having consciously and conspicuously evaded ever making the determination that curtailment can even be used as a method of showing pre-construction compliance in Ch. PSC 128.
29.Finally, the Commissions interpretation of Wis. Stat. 196.491(3)(dg), which obligates it to consider the wind siting rules when issuing CPCNs, is itself an administrative interpretation of a governing statute which has the effect of law. It is consequently a rule. The Commission has failed to follow any procedural rule-making procedure to adopt this position, which is especially important as it contradicts the Commissions prior position as articulated in its Report to the Legislature on the promulgation of Ch. PSC 128.
II.The Commission determined that curtailment was an appropriate compliance method without following the prescribed procedure.
30.As both the majority and dissenting commissioners stated in the Final Decision on Reopening, the matter of whether Ch. PSC 128 allows curtailment to be considered as a design feature has not been decided. Ex. C, Final Decision on Reopening at p. 22, Dissent at pp. 1-2. While the Commission ordered the parties to brief the matter for consideration in its Final Decision on Reopening, the Commission consciously opted to sidestep the issue. The Commissions assertion in its Final Decision on Remand that the matter has been decided speaks to its prior determination that curtailment is an appropriate strategy without regard to the rules of Ch. PSC 128. Ex. A, Final Decision on Remand at pp. 20-21. As argued above, the Commission is obligated to abide by its own wind siting rules, unless it follows the procedure for articulating an exceptional or unusual circumstance, which has not been done in this case. It cannot make a holding here without regard to those rules.
31.A determination that Ch. PSC 128 allows curtailment as a design feature would have effect of law and a considerable impact on municipalities across the state, which would be obligated to abide by the Commissions interpretation of the rules when considering their own wind energy applications. Whether because of the precedential implications of such an interpretation, or because of internal concerns by the commissioners themselves regarding whether the wind siting rules would permit such an interpretation, or for any other reason, the Commission has evaded a determination on this matter. Instead, the Commission attempts to conceal its legal determination that curtailment shows compliance for Highland in a self-created lacuna between Ch. PSC 128 and Wis. Stat. 196.491. It attempts to interpret the rules of Ch. PSC 128 without formally interpreting the rules of Ch. PSC 128, and to make implicit and critical legal determinations without actually making a formal legal determination. The Commission may not have its cake, as it were, and eat it, too. If the Commission wishes to interpret Ch. PSC 128 as authorizing curtailment as a design feature, it must do so through the proper procedure and with statewide applicability, rather than as a convenient procedural tool that only the Commission is entitled to apply, at its sole discretion and without procedural safeguard.
32.If the Commission believes that curtailment can be used as a design feature in Ch. PSC 128, the appropriate procedure would have been rule-making, either as a legislative or interpretive rule. See, e.g., State v. Harenda Enterprises, Inc., 2008 WI 16, 27 (discussing the distinction between legislative and interpretative rules). While the parties may debate what procedures are required to make this determination, the critical issue is that no procedure was followed on this issue. The Commission requested briefings on the matter, determined that they were not bound to make a determination, and then amended a final decision that implicitly relies on a determination that the Commission explicitly refused to make.
33.The Commission, through its Final Order on Remand, removed the 95% compliance standard that would have previously controlled turbine noise exceedances. For the first time in this matter, design compliance is now entirely reliant on post-construction curtailment. The Commission arrived at its ability to make a determination, divorced from Ch. PSC 128, via an erroneous interpretation of the statutes. It attempted to identify a variance from the rules without using the method it created for itself through the exceptional circumstances rule. It interpreted statutes and promulgated rules here without following proper procedure. Furthermore, it now relies upon an internal and informal interpretation of curtailment that the commissioners themselves have steadfastly refused to hold, and that would apply only to the Commission, but not to the municipal wind energy applications that Ch. PSC 128 was also designed to regulate. Consequently, for material errors of law and procedure, reversal or remand is appropriate.
PRAYER FOR RELIEF
For the foregoing reasons, Petitioner respectfully requests this Court reverse or remand the Commissions Final Decision on Remand on the grounds of material errors of law and procedure, with instructions regarding the correct interpretation of relevant legal provisions. The Town also requests leave to present additional evidence before the Court and the Commission.
Respectfully submitted this 9th day of September, 2016.
LEVINE LYON LLP
By:Jeremy B. Lyon, SBN 1094374
Attorney for the Town of Forest
Levine Lyon LLP
14 West Mifflin Street, Suite 206
Madison, WI 53703
(888) 367-8198 (Telephone)
(608) 268-8607 (Facsimile)