Sponsored by

                                                                                                                                                                                                  cc: Brian Carlson
STATE OF MINNESOTA                                                                                                                                                          Sarah Stroebel
IN COURT OF APPEALS                                                                                                                                                           Dick Nowlin
                                                                                                                                                                                                From: David Sasseville
 
 

City of Bloomington, and Bloomington Amphitheater Coalition,  Appellants,
                VS
City of Burnsville, Respondent.
 

David R. Ornstein, Esq.
City of Bloomington
2215 West Old Shakopee Road
Bloomington, Minnesota 55431
Telephone: 952.563.8753

ATTORNEYS FOR APPELLANTS

STATEMENT OF LEGAL ISSUES

STATEMENT OF THE CASE AND FACTS
 

I. The Proposed Amphitheater Project

II. The EAW Process And The Rod

III. Post Record Of Decision Events
 

A. The PUD Process

B. The Metropolitan Council Process

C. The Litigation
 

1. Count I

2. Counts II and III

 
I. Standard Of Review

II. Count I   The District Court Erred In Holding That A Mandatory EIS Is Not Required
 

A. Burnsville’s Determination That The Project Does Not Have A Design Capacity Or Expected Peak Attendance Of 20,000 or More Is Unsupported By Substantial Evidence In the Administrative Record

B. The District Court Erred In Considering Evidence Outside of the Administrative Record

III. Count II The District Court Erred In Holding That No EIS Is Required Because The Project Does Not Have The Potential For Significant Environmental Effects

A. Noise Impacts
 

1. The RGU’s Finding That There Is No Potential For Significant Environmental Effects Related to Noise is Not Supported by Substantial Evidence and is Erroneous As a Matter of Law

a. Record Evidence
b. Extra-record Evidence
c. The Potential for Violation of State Noise Standards Constitutes, as a Matter of Law, the Potential for Significant Environmental Impacts Requiring an EIS

2.The District Court Erred in Relying On Extra-Record Evidence Generated After the July 20, 2000 Negative Declaration 31

3. If Extra-Record Evidence is to be Considered, Then The District Court Erred in Denying Bloomington the Right To Develop and Submit Extra-Record Evidence to Rebut Burnsville’s Extra-Record Submissions

4. Plaintiffs Are Not Barred By the Doctrine of Collateral Estoppel From Pursing Their Claim That An EIS Is Required Due to Potential Significant Environmental Impacts Related To Noise

B. Water Impacts-The RGU Erred in Failing to Require an EIS due to Potential Water Quality and Related Effects

C. Traffic Impacts-The RGU Erred by Failing to Require an EIS on the Basis of Potential Traffic Impacts

IV. Count III The District Court Erred By Failing To Find That MEPA Was Violated By Burnsville’s Failure To Consider The Cumulative Impacts Of Future dewatering

CONCLUSION

Cases
 

Iron Rangers for Responsible Ridge Action v. Iron Range Resources et al. 531 N.W.2d 874 (Minn. Ct. App. 1995) 31

Minnesota Center for Environmental Advocacy v. Minnesota Pollution ControlAgency, 2002 Minn. LEXIS 354, pg 9-11 (Minn. 2002) 31, 36

National Audubon Society v. Minnesota Pollution Control Agency, 569 N.W.2d211 (Minn. App. 1997) 17,21

Society v. MPCA, supra, 569 N.W.2d at 215 17, 21

Trout Unlimited v. Minnesota Department of Agriculture, 528 N.W.2d 903 (Minn. App. 1995) 17,21

White v. Minnesota Department of Natural Resources, 567 N.W.2d 724 (Minn. App. 1997)

Willems v. Commissioner of Public Safety, 333 N.W.2d 619 (Minn. 1983) 34

Williamson v. Guentzel, 584 N.W.2d 20 (Minn. Ct. App. 1998) 34
 

Minn. Stat. § 116B.02, subd 5 30

Minn. Stat. §116D.01

Minn. Stat. §1 16D.04 subd. 2a(b) 16, 21, 30

Rules
 

Minn. Rules 4410.1100,4410.1500,4410.1600, and 4410.1700 22

Minn. Rules 4410.1700, Subp. 3 16, 21

Minn. Rules 5800.0040, Subp. 4 12, 35

Minn. Rules Part 5800.0040 35

Minn. Rules, Part 4410.2000, Subp. 2 and Part 4410.4400, Subp. 22 6

Minnesota Rules, Part 4410.1700, Subp. 1 1, 11, 31

Minnesota Rules, Part 4410.1700, Subp. 7B 2

Minnesota Rules, Part 4410.2000, Subp. 2 and Part 4410.4400, Subp. 22 1, 18

This consolidated action is brought by the City of Bloomington ("Bloomington") and the Bloomington Amphitheater Coalition, ("BAC") against the City of Burnsville ("Burnsville"), the Responsible Governmental Unit ("RGU") with respect to the environmental review of the proposed Black Dog Amphitheater project ("Project"). Pursuant to the Minnesota Environmental Policy Act ("MEPA"), Minn. Stat. § 116D.01, et seq., Burnsville prepared an Environmental Assessment Worksheet ("EAW") for the Project and subjected the EAW to the public comment process mandated by MEPA. In a Record of Decision dated July 20, 2000 ("ROD"), the Burnsville City Council made a Negative Declaration with respect to the need for an Environmental Impact Statement ("EIS") for the Project. This action challenges that determination on three grounds.

In Count I of the Complaint, Bloomington asserts that an ElS for the Project is mandatory under MEPA and Minnesota Rules, Part 4410.2000, Subp. 2 and Part 4410.4400, Subp. 22, which provide that an ElS is mandatory "for construction of a new outdoor sports or entertainment facility designed for or expected to accommodate a peak attendance of 20,000 or more persons…." (emphasis added)

In Count II of the Complaint, Bloomington asserts that an EIS is required for the Project under MEPA and Minnesota Rules, Part 4410.1700, Subp. 1, which state that" a[n] EIS shall be ordered for projects that have the potential for significant environmental effects."

In Count III of the Complaint, Bloomington asserts that the RGU failed to consider the "cumulative potential effects of related or anticipated future projects", as required by MEPA and Minnesota Rules, Part 4410.1700, Subp. 7B.

The appeal before this court is from orders dated March 25, 2002, June 19, 2002 and October 8, 2002, and the final judgment of the district court, rejecting these MEPA claims. This appeal raises three legal issues which go far beyond this case, to the heart of MEPA and the integrity of the state environmental review program. These three issues are:

 
1. Whether the district and appellate courts, in reviewing a challenge to the decision of an RGU regarding the need for an EIS, may consider evidence generated after the RGU’s determination and outside of the administrative record before the RGU at the time of its determination.

2. Whether the projected violation of a state environmental quality standard, in this case a state noise standard, constitutes, as a matter of law, the potential for a significant environmental effect and therefore requires the preparation of an EIS.

3. Whether the thresholds established in the Environmental Quality Board ("EQB") Rules implementing MEPA for the preparation of a mandatory EIS should be strictly applied by RGUs and the courts based on the evidence before the RGU at the time a decision on the need for an EIS is made.
 

 
4. Whether the District Court erred, as a matter of law, in its June 19, 2002 Order denying Bloomington’s Motion in Limine and Motion for Access to Conduct Sound Study, and its October 8, 2002 decision, when it allowed Burnsville to rely on evidence developed after the July 20, 2000 Negative Declaration to support its decision, and did not allow Bloomington the opportunity to develop its own extra-record evidence in order to respond to Burnsville’s extra-record summary judgment submissions.

5. Whether the District Court erred, in its March 25, 2002 Order, when it determined that a mandatory EIS is not required for the Project based upon a finding of fact, with no citation to the administrative record, that Burnsville had sufficient information before it that the capacity of the proposed amphitheater would be less than 20,000 persons, where the only evidence of design capacity in the record reflected a design capacity far beyond 20,000, the ROD itself reflected that the amphitheater was designed to have a capacity of 20,000 or more, and the evidence in the record reflected that the amphitheater could be expected to accommodate a peak attendance of 20,000 or more persons.

6. Whether the District Court erred, as a matter of law, in its October 8, 2002 decision, when it found that Burnsville has not violated MEPA, based upon a finding that the Project does not have the potential for significant environmental effects, where the record before Burnsville at the time of the Negative Declaration, and subsequent to the Negative Declaration, was undisputed that the Project has the potential to violate Minnesota state noise standards due to crowd noise.

7. Whether the District Court erred, as a matter of law, in its October 8, 2002 decision, in holding that a decision of the Metropolitan Council regarding the metropolitan significance of the Project bars Bloomington’s noise claims under MEPA under the doctrine of collateral estoppel.

8. Whether the District Court erred, in its October 8, 2002 decision, in finding that Burnsville has not violated MEPA in stating that the Project does not have the potential for significant water related effects, where the record reflects that the Project will require a dewatering operation at the Project site in the future, and where the Minnesota Department of Natural Resources ("DNR") concluded, with no refutation in the record, that the dewatering issue raised the prospect of significant environment effects and both the DNR and the United States Fish and Wildlife Service recommended that an EIS be prepared.

9. Whether the District Court erred, in its October 8, 2002 decision, in finding that Burnsville has not violated MEPA in stating that the Project does not have the potential for significant environmental effects due to traffic, where the record reflects that certain elements of the traffic issue had not even been addressed during the EAW process.

10. Whether the District Court erred, as a matter of law, in its October 8, 2002 decision, in finding that Burnsville has not violated MEPA and Minnesota Rule Part 4410.1700 Subp. 7, by failing to consider the cumulative effects of related or anticipated future projects, including the future dewatering project which all parties acknowledge will be required.

I. The Proposed Amphitheater Project

 
The amphitheater project was first proposed in 1989. At that time, Burnsville indicated in an EAW that "the project involves the construction of an outdoor entertainment amphitheater with a peak attendance of 20,000 persons." Moloney Aff. I at Exh. 1, 14128. The amphitheater project did not go forward in 1989. In January 2000, Burnsville elected to update the EAW for the 1989 project. According to Burnsville, the design of the new amphitheater is "identically sized" to that of its 1989 predecessor. Id. at Exh. 18, 19295. However, the updated EAW indicates, without explanation, that the seating capacity is 19,500. Id. This unexplained adjustment is significant, because under Minn. Rules, Part 4410.2000, Subp. 2 and Part 4410.4400, Subp. 22, an EIS is mandatory if the Project is "designed for or expected to accommodate peak attendance of 20,000 or more persons".

During the EAW comment period, Bloomington and others raised the issues of design capacity and expected peak attendance. In particular, Bloomington included in its comments the report of an expert who indicated that the design capacity of the Project is over 37,000. Bloomington also included testimony showing that the actual experience at similar sized amphitheaters is that attendance frequently exceeds 20,000 persons. (AA100-107C.) In Burnsville’s response to these comments, it ignored the statement of Bloomington’s expert regarding the design capacity of the Project, and instead focused on its assurance that the Project would be operated so as to limit peak attendance to less that 20,000. A myriad of additional issues were raised during the comment period, including: (1) noise issues associated with concert performances and crowd noise; (2) water quality issues associated with contaminants present on the Superfund Site and the need for a future dewatering operation at the amphitheater site; and (3) traffic issues.

During the comment period, the U.S. Department of Interior Fish and Wildlife Service, after addressing noise, water quality, traffic and cumulative impact issues. concluded that "[w]e sincerely believe that this proposal, with all if (sic) its complexities noted above, should require a higher level of review through the development of a comprehensive environmental impact statement." (AA99.) Similarly, the Minnesota Department of Natural Resources concluded "an EIS may be the best means available to comprehensively address the full range of issues that are associated with the project." (AA121.) The DNR specifically requested that if an EIS was prepared "potential project-related dewatering be included within the scope of the EIS." Id.

On July 20, 2000, the Burnsville City Council passed a resolution adopting the Record of Decision, the Burnsville Responses to Comments on the Environmental Assessment Worksheet, and a Decision that "[t]he project as proposed does not have the potential for significant environmental effects and therefore preparation of an environmental impact statement is not ordered." (AA46.)

The finding of the ROD acknowledges that the Project has a design capacity of 20,000, because it indicates that, due to operational restrictions, the "maximum total occupancy of the site (including staff, performers and crew) will never exceed 20,000 people." (emphasis added) (AA48-48A.) Thus, the ROD itself acknowledges that both the design of the Project and the expected attendance exceed the mandatory EIS threshold.

The ROD also acknowledges the "potential for future groundwater contamination from the landfill after the adjacent Kraemer quarry stops dewatering" (AA49); and that when dewatering is necessary at the amphitheater, "[t]here is the potential that dewatering in this location will draw pollutants from the landfill into the amphitheater dewatering." With respect to noise from amphitheater events, the ROD finds that "the proposed Black Dog Amphitheater will not have a significant environmental impact on the surrounding community from noise…"" (AA52.) Finally, with respect to the cumulative potential effects of related or anticipated future projects, the RGU simply found that "no related projects are anticipated." (AA52A.)

On the basis of the above, the ROD concluded "the Blackdog Amphitheater does not have the potential for significant effects and that preparation of an Environmental Impact Statement for the project is not required." Id.

III. Post Record Of Decision Events
 

A. The PUD Process

In August and September 2000, Burnsville considered an application from the Project developer for a Planned Unit Development ("PUD") Amendment for the Project. On August 21, 2000 a hearing was held before the Burnsville City Council at which a witness, Gary Vogel, testified that the design capacity of the proposed Project was less than 20,000. Kozar Affidavit dated February 12, 2002, Exhs. A and J. On September 5, 2002, the application for a PUD Amendment was approved with a Findings of Fact which again acknowledges that the Project has a capacity of 20,000 ("total site occupancy will never exceed 20,000").

B. The Metropolitan Council Process

In August 2000 Bloomington and others petitioned the Metropolitan Council for "metropolitan significance" review of the Project. The Council was asked to determine "if the proposed project adversely affects existing or proposed land use or development in another local government unit with respect to…noise pollution." During this process a hearing was held before an administrative law judge who issued findings of fact, conclusions and a recommendation which was ultimately approved by the Metropolitan Council. (AA73-90.) The findings acknowledged that under "worse case" conditions, crowd noise from the Project may exceed state noise standards. Id. The administrative law judge and the Council concluded that the proposed Project did not have metropolitan significance so long as the requirements of the PUD, as amended by commitments made at the administrative hearing were followed. Id. and Kozar Affidavit, dated May 13, 2002, Exh. D. Subsequently, the developer entered into an Agreement with the Metropolitan Council, to which Bloomington was not a party, incorporating certain noise mitigation measures of the Project.

C. The Litigation

1. Count I   This litigation was commenced by Bloomington and BAC following Burnsville's Negative Declaration on the need for an EIS for the Project. On January 24, 2002,

Bloomington filed a motion for partial summary judgment as to Count I of its Complaint, (AA24-45) which asserts that a mandatory EIS is required for the Project.

Burnsville filed a cross-motion for partial summary judgment on Count I which heavily relied upon evidence beyond the administrative record before Burnsville at the time of its July 20, 2000 Negative Declaration. In particular, Burnsville relied on evidence generated after the Negative Declaration during the PUD approval of the Project. Included in this evidence was the testimony of an expert who testified during the PUD process that the design capacity of the Project is less than 20,000.

On March 1, 2002, a hearing was held on the cross-motions for partial summary judgment. At the hearing, Bloomington emphasized that "the only evidence in the {administrative} record of what the design capacity of this project is came from the city of Bloomington" and "it says that the capacity is almost double what triggers the mandatory EIS." March 1, 2002 Transcript ("Tr. I") 8. See also 50-51 "[W]e dared them in our brief.. . to show something in the record that said we were wrong" when Bloomington said, "the only evidence in the record of design capacity is ours." Tr. 110. Bloomington then argued that that under MEPA, review of the RGU’s decision is limited to evidence that was before the RGU at the time of the Negative Declaration. Tr. 1, 12-14. Burnsville argued in response that it was not limited to the record before Burnsville at the time of the Negative Declaration.

On March 25, 2002 the district court issued an Order and Memorandum denying Bloomington’s Motion for Partial Summary Judgment and granting Burnsville’s Motion for Partial Summary Judgment. (AA1-4.) The district court failed to cite any evidence in the administrative record rebutting Bloomington’s submission during the comment period showing that the design capacity far exceeded 20,000. Id. Instead, the Court generally found that "the City Council had before it a full and complete record, including reports and comments from engineers, planners, the fire department, department of natural resources, and the public" and that "[t]he Council had sufficient information before it that the capacity of the amphitheater would be less than 20,000." March 25, 2002 Order and Memorandum (AA4.) The Court made no ruling on Bloomington’s motion to strike evidence relied upon by Burnsville developed after the Negative Declaration, and thus allowed Burnsville to rely on such evidence.

Bloomington asserts that the district court erred in finding that Burnsville had sufficient information before it to find that the design capacity of the Project was less than 20,000, and in allowing Burnsville to rely on evidence outside the administrative record before the City of Burnsville when it made its Negative Declaration on July 20, 2000.

  2. Counts II and III   On June 14, 2002, Bloomington filed a motion for partial summary judgment as to Count II of the Complaint, which asserts that an EIS is required under Minnesota Rules, Part 4410.1700, Subp. 1, which states, "[a]n EIS shall be ordered for projects that have the potential for significant environmental effects." Bloomington also moved for partial summary judgment with respect to Count III of the Complaint under Minnesota Rules, Part 4410.1700, Subp. 7, which states that, in deciding whether a project has the potential for significant environmental effects, among the criteria which shall be considered is the

"cumulative potential effects of related or anticipated future projects." On the same date, Burnsville cross-moved for partial summary judgment on Counts II and III. In support of its motion, Burnsville again relied upon evidence which had been developed after its Negative Declaration, particularly evidence presented during the PUD process.

Given the controversy regarding the use of extra-record evidence relating to Count I, prior to filing its motion for partial summary judgment on Counts II and II, Bloomington filed a Motion In Limine, Or, In the Alternative, For Access to Conduct Sound Test. In its Motion, Bloomington argued that evidence developed after the July 20, 2000 Negative Declaration should not be considered, unless it fell within the judicially created exception for evidence clarifying the record. In the alternative, Bloomington argued that it should be allowed access to the Project site so that it might conduct a sound test during the summer months which would approximate the weather conditions when concerts will be held.

Burnsville filed a Motion to Amend its answer to include the affirmative defenses of res judicata and collateral estoppel. Burnsville’s motion argued that the Metropolitan Council’s decision that the Project does not have "metropolitan significance" under Minn. Rules 5 800.0040, Subp. 4 (because it would not have a "substantial physical effect on a local government unit" or "adversely affect existing or proposed land use or development in another local government,") barred Bloomington’s noise related claims under MEPA.

On June 19, 2002, the district court issued an Order and Memorandum (AA2O-23) denying Bloomington’s Motion in Limine and its Motion For Access to Conduct a Sound Study. The court further granted Burnsville’s Motion to Amend, ruling that evidence developed after the Negative Declaration, including the PUD Agreement between Burnsville and the developer of the Project, and any other "regulatory controls" put into effect after the Negative Declaration "is admissible on summary judgment and at trial, subject to the rules of Evidence." The court explained in its Memorandum that "the Court must consider the ongoing regulation that is designed to mitigate the environmental effects that concern Bloomington residents."

In Bloomington’s opposition to Burnsville’s motion for partial summary judgment, Bloomington raised the summer sound study again by filing an affidavit under Rule 56.06 indicating generally that if Burnsville was going to be allowed to use extra-record evidence on the noise issue, than Bloomington needed the opportunity to develop its own extra-record evidence in the form of a summer sound study and expert testimony in order to respond to Burnsville’s extra-record summary judgment submissions. (AA 195-229.)

On October 8, 2002, the district court issued Findings of Fact, Conclusions of Law and Order granting Burnsville’s motion for partial summary judgment and denying Bloomington’s motion for partial summary judgment. (AA5-1 8.)

Bloomington contends that the district courts rulings on Counts II and III are in error on several grounds. With respect to the noise issue, whether the court focuses on the record before Burnsville at the time of its Negative Declaration, or the record subsequently developed, the record reflects that the Project is expected, in certain conditions, to violate Minnesota state noise standards. The potential for violation of these standards was acknowledged by Burnsville’s own experts during the EAW process and in the findings of the Metropolitan Council. Burnsville even acknowledged in its summary judgment submissions that "the actual sound levels for most events will be below what is modeled and therefore will be below state standards." (emphasis added) (AA56.) Bloomington submits that the admitted potential for violation of Minnesota environmental quality standards constitutes, as a matter of law, the potential for significant environmental effects requiring an EIS under MEPA. This conclusion is supported by the language of Section 116D.04, Subd. 1a(b) and 6 of MEPA which bars "state action significantly affecting the quality of the environment" and then defines, by reference to a definition in the Minnesota Environmental Rights Act, Minn. Stat. 1 16B.02, Subd. 5, such action as including conduct "which violates, or is likely to violate, any environmental quality standard."

In addition, the district court erred in considering extra-record evidence of mitigation. While MEPA provides for the consideration of mitigation in considering the need for an EIS, such consideration is limited to the mitigation evidence before the RGU at the time of its determination. If extra-record evidence is to be considered, then the district court erred in precluding Bloomington from conducting a summer sound test and developing expert testimony to respond to Burnsville’s extra-record evidence.

The district court further erred in holding that the determination of the Metropolitan Council that the Project does not have "metropolitan significance" barred Bloomington’s noise claims under the collateral estoppel doctrine. The standards for a determination of whether an EIS is required under MEPA are far different than the standards for determining whether a project has metropolitan significance.

The district court also erred in finding that there was substantial evidence supporting the RGU’s finding that the Project does not have the potential for significant environmental effects other that those related to noise. When the neighboring quarry dewatering operation closes down, the amphitheater would become flooded unless it initiates its own dewatering operation. Such a dewatering operation would require a permit from the DNR. During the EAW process the DNR indicated that such dewatering operations have their own negative environmental effects on habitat and further stated that it could give no assurance that it would issue a new permit. Burnsville rejected the DNR’s call to prepare an EIS to study the cumulative potential environmental effects through the public EIS process so that alternatives which might avoid the environmental impacts may be explored.

Since MEPA was enacted in 1973, both the EQB and commentators have expressed concern that the purposes of MEPA are being undermined by the tendency of governmental units to avoid EIS’s by improperly using an EAW as a substitute for an EIS, or by characterizing the scope of the project to fall just below the mandatory EIS threshold.’ Such tendencies are perhaps not surprising since an RGU is often both the proponent of the project and the decision maker regarding whether the proposed Project will be subjected to the heightened review of an EIS. However, given such circumstances, if the purposes of MEPA are to be served, it is imperative that this Court closely scrutinize the determination of the RGU, and the district court’s rulings.
 

Unlike an EAW, an EIS must include an analysis of alternatives which might eliminate or mitigate environmental damage, an analysis that has been said to be the "heart" of the process. An EIS might also include analysis of the potential economic and sociological impacts of a proposed project, analysis not required in an EAW and not undertaken with respect to this Project. In a 1985 report, the EQB recognized that it was inappropriate for an EAW to be used as a substitute for an EAW:

Under MEPA, the decision whether to prepare an EIS "shall be based on the Environmental Assessment Worksheet and the comments received during the comment period." Minn. Stat. §116D.04 subd. 2a(b). See also Minn. Rules 4410.1700, Subp. 3 ("The RGU shall base its decision regarding the need for an EIS and the proposed scope on the information gathered during the EAW process and the comments received on the EAW.") Thus, under the plain language of the statute and the applicable regulation, the RGU is required to make its decision on the basis of the record before it at the time the decision is made. White v. Minnesota Department of Natural Resources, 567 N.W.2d 724, 734 (Minn. App. 1997). In Trout Unlimited v. Minnesota Department of Agriculture, 528 N.W.2d 903, 907-908 (Minn. App. 1995), the Court acknowledged that the record may encompass more than responses labeled "comments," but to be part of the record, documents must be available to and in the possession of the’ RGU at the time of the decision whether an EIS is necessary. See also, National Audubon Society v. Minnesota Pollution Control Agency, 569 N.W.2d 211, 216 (Minn. App. 1997).

II. Count I The District Court Erred In Holding That A Mandatory EIS Is Not Required

c. The Potential for Violation of State Noise Standards Constitutes, as a Matter of Law, the Potential for Significant Environmental Impacts Requiring an EIS

 
As shown above, the record before the RGU and the district court clearly demonstrates that the amphitheater has the potential to violate Minnesota state noise standards. The RGU has admitted this in the EAW, in its noise studies (both before and after the Negative Declaration), and in its memorandum to the district court. The Metropolitan Council, upon whom Burnsville relies, found that the Project created the potential for violation of state noise standards due to crowd noise, and the district court incorporated those findings into the findings of the Court. (AAIO.) Moreover, the district court recognized the potential for violations of state noise standards in another finding which finds that the PUD agreement requires "penalty and fines for any violations." (AA9.)

The only remaining question is whether these violations constitute a potential significant environmental effect, and therefore require the preparation of an EIS. It is clear under MEPA that they do, and thus an EIS is required.

Burnsville argued before the district court that, "[a] few extreme conditions are not a significant effect that would require an EIS" and that a violation in worst case conditions "is clearly not a significant effect that requires an EIS (AA55A-55B.) However, there is no such diminimus rule in MEPA or in the state’s noise standards. If the potential for the violation of an environmental standard exists, then the potential for significant environmental effects exists and an EIS must be completed to analyze the impacts of those effects and potential alternatives that would eliminate or lessen any environmental effects.

Section 116D.04, Subd. 6 of MEPA provides, in part, as follows:

No state action significantly affecting the quality of the environment shall be allowed, nor shall any permit for natural resources management and development be granted, where such action or permit has caused or is likely to cause pollution, impairment or destruction of the air, water land or other natural resources located within the state so long as there is a feasible and prudent alternative consistent with the reasonable requirements of the public health, safety, and welfare and the state’s paramount concern for the protection of its air, water, land and other natural resources from pollution, impairment, or destruction.

"Pollution, impairment or destruction" is defined in MEPA, Minn. Stat. 116D.04 subd. 1a(b), by incorporation of the definition of that phrase in the Minnesota Environmental Rights Act (MERA), Minn. Stat. 116B.02, subd. 5, which provides as follows. Subd.5 Pollution impairment or destruction" is any conduct by any person which violates, or is likely to violate, any environmental quality standard, limitation, rule, order, license, stipulation agreement, or permit of the state or any instrumentality, agency or political subdivision thereof which was issued prior to the date the alleged violation occurred or is likely to occur... Section 116D.04 Subd 2a of MEPA provides, in part: Where there is potential for significant environmental effects resulting from any major governmental action, the action shall be preceded by a detailed environmental impact statement prepared by a responsible governmental unit. The record reflects that the Amphitheater is likely to violate state noise standards, if nothing else, "under a few extreme circumstances." (AA55A) Under MEPA, this likelihood of a violation, no matter how infrequent, constitutes "pollution, impairment, or destruction" of natural resources. Minn. Stat. § 116B.02, subd 5. Pollution, impairment or destruction of the state’s natural resources is prohibited, so long as there is a feasible and practical alternative to the proposed action. Minn. Stat. § 116D.04, subd. 6. Under MEPA, the vehicle for determining whether alternatives are available to avoid environmental impacts associated with the violation of a state environmental quality standard is the EIS. Minn. Stat. § 116D.04 subd 2a.

MEPA creates no exceptions for supposedly infrequent violations of State environmental quality standards. Any violation is prohibited so long as there is a feasible and prudent alternative. Therefore, acknowledgment of the potential for noise violations by Burnsville and its experts requires the preparation of an EIS which will study, with the participation of government agencies and the public, the noise effects of the Project, and any alternatives that might be available to avoid such impacts.

2. The District Court Erred in Relying On Extra-Record Evidence Generated After the July 20, 2000 Negative Declaration

The district court held that evidence generated after the Negative Declaration on July 20, 2000 may be reviewed by the court in considering a MEPA challenge, and relied upon such evidence. (AA10, 16-17.) As discussed above, consideration of evidence outside of the administrative record before the RGU at the time of its determination, save those situations where extra-record testimony is need to clarify the record, contravenes the language of MEPA, the rules implementing the statute, and the court decisions interpreting MEPA. The district court was apparently persuaded by Burnsville’s argument that the provisions of Minn. Rules 4410.1700 Subp. 1 (1997) provide for a different approach by allowing consideration of mitigation evidence generated after the Negative Declaration. Minn. Rules 4410.1700 subd. 1 provides that among the factors to be considered by the RGU in determining whether a project has the potential for significant environmental impacts are "the extent to which the environmental effects are subject to mitigation by ongoing public regulatory authority."

Burnsville specifically relied on Minnesota Center for Environmental Advocacy v. Minnesota Pollution Control Agency, 2002 Minn. LEXIS 354, pg 9-11 (Minn. 2002) (the "MCEA decision") and Iron Rangers for Responsible Ridge Action v. Iron Range Resources etc.!. 531 N.W.2d 874 (Minn. Ct. App. 1995) ("the IRRRB decision"), neither of which support the proposition that evidence generated after a Negative Declaration can be considered in determining whether the RGU violated MEPA.

The MCEA decision did not involve the review of evidence generated after the decision by the MPCA that no EIS was required. In MCEA, the argument posed was that the decision not to prepare an EIS was improper because the mitigation measures identified in the record before the MPCA at the time of the Negative Declaration were not adequate. In rendering its decision, the Minnesota Supreme Court reviewed the record before the RGU and found that on the basis of that record, the RGU had fulfilled its obligation to consider the extent to which potential environmental impacts were subject to mitigation. The Court was not asked to review evidence of mitigation generated after the Negative Declaration, as Burnsville asks this Court to do.

The same is true with respect to the IRRRB decision. In that case, the RGU was a county which concurrently conducted an EAW process and a Conditional Use Permit ("CUP") process in connection with the proposed Project. Thus, at the time of its Negative Declaration, unlike this case, the County had the information generated by both the EAW and the CUP process. The County determined, on the basis of the record then before it, that no EIS was required. 531 N.W.2d at 884. The IRRRB court found that this conclusion was supported by substantial evidence in the record. The County also found that it needed additional information in order to issue a CUP, and it thus conditioned the issuance of the CUP on further studies. The Court found that the independent requirement of further studies before issuance of the CUP did not suggest that the RGU was using this requirement as a device to avoid an EIS. Id. at 885. Unlike this case, the Court was not asked to review studies and other evidence generated after the Negative Declaration.

In sum, these cases support the obvious proposition that a court reviewing the Negative Declaration of an RGU can look at the mitigation evidence in the record before the RGU at the time of its decision to see if that evidence supports the determination of the RGU that no EIS was required. That is far different than what the district court allowed, which is the review of evidence generated after the Negative Declaration to buttress the RGU’s determination. As stated by the IRRRB court, the focus of the reviewing court is to be "on the proceedings before the decision-making body" and upon "the administrative record" created by the RGU. Id. at 880-81.

3. If Extra-Record Evidence is to be Considered, Then The District Court Erred in Denying Bloomington the Right To Develop and Submit Extra-Record Evidence to Rebut Burnsville’s Extra-Record Submissions

 
If this Court rules that the district court was correct in allowing extra-record evidence, then the district erred by precluding the development of extra-record evidence by Bloomington through its June 19, 2002 Order (AA20-23) and its failure to respond to the Rule 56.06 affidavit submitted by Bloomington setting forth appellant’s need for sound testing and expert testimony to respond to Burnsville’s summary judgment affidavits. If Burnsville is allowed to rely on the Sound Study Report generated during the Metropolitan Significance process, then the plaintiffs clearly have the right to submit extra-record evidence rebutting these extra-record submissions of Burnsville.

The sound experts performing the joint sound study agreed that the best time to conduct tests to determine the potential noise impacts of the proposed Project is during the summer, when the amphitheater would be in operation:

The ideal measurement period for these measurements is during summer evenings, when concerts are expected to occur. In addition, it is during summer evenings when temperature inversions are most likely to occur and we expect that those atmospheric conditions are most likely to result in enhanced sound propagation conditions that have been described by residents of the Bloomington bluffs. Further, winds are more often from the south and southwest during the summertime, also potentially enhancing sound propagation from the proposed site to the bluffs.   (AA220.) No such tests were conducted during the Metropolitan Significance process. The issues under consideration by the Metropolitan council were far different than those presented in the MEPA context. Thus, the fact that summer sound tests were not considered necessary for purposes of the Metropolitan Significance process provides no basis for precluding the City of Bloomington from conducting and presenting such tests here to rebut the extra-record submissions of Burnsville. Moreover, as reflected in the Affidavit of Lawrence Moloney Submitted Pursuant to Rule 56.06 (AA195-198), even setting aside the issue of summer testing, in order to respond to Burnsville’s submissions Bloomington would need the opportunity to generate responding affidavits of its own sound experts.

4. Plaintiffs Are Not Barred By the Doctrine of Collateral Estoppel From Pursing Their Claim That An EIS Is Required Due to Potential Significant Environmental Impacts Related To Noise

The collateral estoppel doctrine requires that the issue in the prior adjudication and the issue in the pending adjudication be identical. Williamson v. Guenizel, 584 N.W.2d20, 23 (Minn.Ct. App. 1998); Willems v. Commissioner of Public Safety, 333 N.W.2d619, 621 (Minn. 1983). The district court erred in ruling that the Metropolitan Council decision that the proposed Project does not have "metropolitan significance" barred Bloomington’s Noise claims under MEPA because the issues presented are clearly not identical.

The issue before the Metropolitan Council, under the Metropolitan Significance Rules, was whether the proposed amphitheater "may have a substantial physical effect on …" Bloomington, Minn. Rules Part 5800.0040 and (AA76.) More specifically, "a proposed Project may be of metropolitan significance if it adversely affects existing or proposed land use or development in another local governmental unit with respect to... noise pollution." Id.

On the other hand, the issue before this Court, under MEPA is whether the city of Burnsville acted arbitrarily and capriciously, or without substantial support in the record, in determining that an EIS is not required because the amphitheater has no potential for significant environmental effects. Minn. Stat. Section 116D.04 and Minnesota Rule 4410.1700. These are clearly different standards and different issues.

The decision as to whether an EIS is required was recognized by the Administrative Law Judge and the Metropolitan Council as a distinct issue. (AA17.) More importantly, the Metropolitan Council decision intentionally did not decide this issue, and deferred "to the District Court on this issue." Id. It is not surprising that the Metropolitan Council deferred to the Court on the EIS issue, because the issues under the jurisdiction of the Metropolitan Council are distinct from MEPA issues. As noted above, under Minn. Rules 5800.0040, the focus of a determination of metropolitan significance is whether a proposed Project "may have a substantial physical impact on a local governmental unit other than the local unit in which the proposed Project is located." More specifically, "a proposed project may be of metropolitan significance if it adversely affects existing or proposed land use or development in another local governmental unit." Put another way, the focus with respect to noise is limited to the effects of noise on people, as opposed to animal or plant life, or other aspects of the environment. Given that the issue before the Metropolitan Council was different that the MEPA issues before the district court, the collateral estoppel cannot be applied to bar Bloomington’s noise claims.

Moreover, under Minnesota Center for Environmental Advocacy v. Metropolitan Council, 587 N.W.2d 838 (Minn. 1999), administrative decisions can not be the basis for the application of collateral estoppel unless the decision is binding on the parties. Here, the Metropolitan Council’s finding that the proposed amphitheater does not have Metropolitan Significance is specifically subject to the execution of an agreement between the developer of the amphitheater and the Metropolitan Council. (AA87.) The City of Bloomington is not a party to that agreement and has no right or ability to enforce that agreement, nor to prevent it from being amended to change the impacts of the Project on Bloomington. Similarly, the City of Bloomington is not a party to the PUD Agreement between the developer and the City of Burnsville upon which the Metropolitan Significance decision was based, and has no right or ability to enforce that agreement, nor to prevent it from being amended to change the impacts of the Project on Bloomington.

These agreements, which form the basis for the administrative decision which Defendants’ argue preempt this Court’s jurisdiction over the noise issue, do not involve, and are certainly not binding on, all of the parties to this MEPA lawsuit. Therefore, the prior administrative proceedings are not binding on all of the parties to this litigation, and therefore the district court erred in finding that collateral estoppel bars Bloomington’s noise claims.
 

B. Water Impacts-The RGU Erred in Failing to Require an EIS due to Potential Water Quality and Related Effects

As discussed above, the RGU itself, in its ROD, acknowledges the potential for ground water contamination when the adjacent Kraemer dewatering operation is shut down. At that indeterminate time, it is admitted by the RGU that an amphitheater dewatering operation will be required lest the amphitheater be transformed into a lake. Id. (AA177.) In the words of the ROD, "[t]here is potential that dewatering in this location will draw pollutants from the landfill into the amphitheater dewatering." (AA50.) This admission of the RGU alone provides the basis for the Court to require an EIS. The RGU seems to think that an EIS is not required simply because the potential impact related to dewatering may not arise for a considerable time. As stated by Burnsville during the EAW process, "[t]he dewatering issues must be considered as the project moves forward." (AA177.) At the time of the RGU’s Negative Declaration, Burnsville admitted that the impacts of dewatering on groundwater flow, including contaminated groundwater, were not known. In response to comments on the EAW, the RGU stated that, "[t]he MPCA staff and consultants are working on the closure plans for the Freeway Landfill, and when this work is completed, the City will be in a better position to evaluate the potential for pollutants in the water seeping into the amphitheater area." Thus, Burnsville in effect admitted the need for further study.

However, under MEPA and the Rules implementing MEPA, the question is not when the potential significant environmental effects will arise, but rather whether the proposed Project has "the potential for significant environmental effects." Moreover, it should be noted that the RGU couldn’t be assured when these impacts will arise, given that the Kraemer quarry operation is a private enterprise that could be closed down at any point in time.

The purpose of an EIS is to address potential significant impacts before the project goes forward so that those impacts can be examined through the public comment process, which includes both federal and state agencies, as well as private citizens, and so that alternatives which might mitigate or eliminate those potential impacts may be examined through that public process. The RGU’s approach of simply promising that the potential impacts will be dealt with sometime after the project is already built thus undermines the core purpose of MEPA.

The record is replete with additional evidence that the RGU erred in not ordering an EIS on the basis of potential water related impacts. Dewatering the Project site can only be conducted under a permit issued by the Minnesota Department of Natural Resources ("DNR"). During the EAW comment period, the RGU was advised by the DNR that the "DNR can offer no assurance that a water appropriation permit will be provided for this project." (AA119.) Moreover, according to the DNR, there has been an increasing emphasis on reducing or even eliminating "non-essential groundwater appropriations, especially in the southwest Twin Cities Metro Area." Id. Such is the case because "extensive groundwater withdrawal from the Prairie-du-Chien-Jordan aquifer has resulted in negative impacts to State protected calcareous fens." Id. Thus, according to the DNR, "dewatering of the amphitheater site may not be authorized if it results in negative impacts to the groundwater hydrology of a calcareous fen complex or other protected water surface features." Id. Moreover, "dewatering for the purpose of protecting an open space use in a floodplain is considered a low priority appropriation." Id. Finally, even if a permit were granted, during times of drought or water shortage, water appropriation permits for non-essential uses such as dewatering would be suspended or otherwise administratively altered. Id. The DNR states that:

It is not advisable to delay consideration of potential project-related water appropriations to some future date. Demonstrating minimization of appropriated volumes is best achieved during project planning rather than many years after the project is built. There may be other site configurations, when coupled with associated avoidance and/or minimization measures, that allow for project objectives to be achieved while reducing or even eliminating the need for future dewatering. (AA119.) The DNR concluded that "an EIS may be the best means available to comprehensively address the full range of issues that are associated with the project. (AA 121.)

The United States Department of the Interior, in its comments on the EAW, recommended "a higher level of review through the development of a comprehensive environmental impact statement," due in part to the need to analyze the relationship of water-related issues, such as the dewatering permits, with other related environmental issues, such as the closure and management of landfills and dumps in the area, and the construction of protective levees. (AA99.) The Department of Interior was particularly concerned about "the potential for contaminated leachate reaching ground and surface waters within and adjacent to the site." (AA95.)

Similarly, in a June 14, 2000 letter, the Metropolitan Council staff stated that they believe "that there are potential impacts that warrant further investigation before the project is commenced." (AA112.) Metropolitan Council staff noted several issues requiring further study, including the potential impact of the dewatering system and the possibility that landfill contamination could be drawn into the Amphitheater site.

(AA112-1 16.)

In sum, the record contains more than sufficient evidence to conclude that the Project has the potential for creating significant environmental effects relating to surface water and groundwater. The ROD itself recognizes such potential impacts, and an array of environmental agencies and private citizens concur that the Project presents several significant potential impacts on and related to water quality.

C. Traffic Impacts-The RGU Erred by Failing to Require an EIS on the Basis of Potential Traffic Impacts

The district court ruled that Burnsville had substantial evidence supporting its conclusion that the Project does not have the potential to cause significant traffic effects. However, the EAW does not even address certain traffic impacts of peak events, when the Amphitheater will be used to full capacity. Instead, the EAW analyzes traffic impacts of an event at 83% of the Project’s stated capacity. (AA107A.) Furthermore, the EAW does not address the impact on traffic flow into the facility of the plan to check tickets of patrons as they enter the facility. This will obviously slow considerably the flow of traffic into the parking areas and will make the congestion and back-ups on I-35W even worse.

The RGU first suggested this modification after their traffic studies had been conducted and after the close of the public comment period during the EAW process. (AA1 69B.) As a result, the RGU has failed to offer an opportunity for independent study and public comment on the traffic impact of checking patrons’ tickets as they enter the facility. The impact of this operational control is particularly critical given the RGU’s commitment to prevent crowds in excess of 19,500 in order to control noise. Even if the RGU intends to keep this commitment, it may well be that the cumbersome job of monitoring incoming vehicles to ensure that only ticket holders are present will create its own traffic-related impacts in an area where traffic congestion and its related impacts are already a serious problem.

Recognizing such problems, in its June 13, 2000 comments on the EAW, the Minnesota Department of Transportation repeated its "ongoing concern over the potential impact which the Project may have on the operation of Interstate Highway 35W when amphitheater patrons are arriving and leaving major events." Exh. 4 at 10152. Based on the evidence contained in the record, the Project has the potential for creating significant environmental effects related to traffic.

IV. Count III The District Court Erred By Failing To Find That MEPA Was Violated By Burnsville’s Failure To Consider The Cumulative Impacts Of Future Dewatering

 
Under Minnesota Rules Part 4410.1700, Subp. 7, in deciding whether a project has the potential for creating significant environmental effects, an RGU must consider the "cumulative potential effects of related or anticipated future projects." Bloomington asserted in Count III of its Complaint that this rule was violated because Burnsville failed to consider the cumulative impact of future dewatering which will be required at the amphitheater when the neighboring Kramer Quarry and its dewatering operation are shut down. The district court made no specific conclusions of law with respect to Count III, simply stating that future dewatering was "studied in the EAW."

However, in the ROD Burnsville dismisses the need for the consideration of cumulative impacts of future anticipated project by blithely stating that "no related projects are anticipated." (AA52A.) While there was some discussion of water contamination, there was no discussion al all of the DNR’s concerns regarding the impacts of future dewatering of fen habitat.

The RGU tries to ignore the amphitheater dewatering project because is will not emerge until sometime in the future. However, the language of the applicable Rule simply encompasses "anticipated future projects." There can be no doubt that the amphitheater dewatering is just such a project. Moreover, as stated by the Minnesota DNR in its comment letter:

It is not advisable to delay consideration of potential project related water appropriation to some future date. Demonstrating minimization of appropriated volumes is best achieved during project planning rather than many years after the project is built. (AA119.)

Burnsville violated MEPA by failing to consider the cumulative impacts of a future dewatering operation which it has acknowledged will be required.

The district court, in its October 8, 2002 Findings, states that Bloomington’s MEPA claims "are based on technical disputes" which Burnsville has broad discretion to resolve in a way that supports its Negative Declaration. However, as a review of Bloomington’s submissions both before this Court and the district court will show, Bloomington’s reliance is not on technical disputes between experts, but on legal issues which go to the very core of MEPA.

With respect to Count I, Bloomington has emphasized that the ROD itself acknowledges that the facility has the capacity to hold 20,000 people, and that the only evidence in the EAW record regarding design capacity is the statement of Bloomington’s expert consultant who indicated that the design capacity of the Project was in excess of 37,000. If the EQB Rules setting a mandatory EIS threshold for this type of facility mean anything, they mean that this project requires a mandatory EIS as a matter of law.

With respect to Counts II and III, Bloomington has emphasized that the potential for violations of state noise standards due to crowd noise was acknowledged by Burnsville’s own experts in the EAW, and even at the hearing on the day of the Negative Declaration; that the potential for violations was confirmed by Burnsville’s own experts during the Metropolitan Council proceedings, acknowledged in the findings of the Metropolitan Council, and accepted in the findings of the district court. Bloomington simply argues that this acknowledged potential for violation of state noise standards constitutes the potential for a significant environmental effect under MEPA as a matter of law.

With respect to water quality issues, Bloomington has emphasized that it is undisputed that if the project is built, it will necessitate dewatering operation at the amphitheater site when the dewatering operation at the adjacent Kramer Quarry terminates. Bloomington simply argues that the failure of Bloomington to consider the cumulative impacts of future dewatering on habitat violates MEPA.

Bloomington argues with respect to all Counts that errors of law were made by the district court in relying on evidence beyond the administrative record before the RGU at the time of the Negative Declaration.

These are not technical disputes where experts are disagreeing with one another and where the RGU has the discretion to support its findings with the testimony of either expert. Rather, these are issues where Burnsville and the district court acted without substantial support in the administrative record and contrary to MEPA. Such issues are precisely the type which are ripe for resolution by this court, which "Need not defer to a lower court’s decision on the same matter." White, supra, at 730. The resolution of these issues are important in protecting the effectiveness of MEPA, one of the cornerstones of Minnesota environmental protection laws.

Bloomington requests on the basis of all of the above, that this court reverse the rulings of the district court and order that an EIS be prepared for the proposed Project.

Dated: February 13, 2003 Respectfully submitted,

GRAY, PLANT, MOOTY, MOOTY & BENNETT, P.A.
 

BY: Lawrence A. Moloney (#165876)
Peter K. Beck (#5927)
33 South Sixth Street
Suite 3400
Minneapolis, Minnesota 55402
Telephone: (612) 343-2800

 

David R. Ornstein, Esq.
City of Bloomington
2215 West Old Shakopee Road
Bloomington, MN 55431
Telephone: (952) 563-3096

David L. Sasseville, Esq. (#156000)
Linquist & Vennum P.L.L.P.
4200 IDS Center
80 South Eighth Street
Minneapolis, MN 55402
Telephone: 612.371.3211
Fax: 612.371.3207

ATTORNEYS FOR APPELLANTS