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Essroc Cement Corp. v. Clark County Board of Zoning Appeals

Court of Appeals of Indiana

April 18, 2019

Essroc Cement Corp., Appellant-Petitioner,
v.
Clark County Board of Zoning Appeals and Sierra Club, Appellees-Respondents

          Appeal from the Clark Circuit Court The Honorable Susan L. Orth, Special Judge Trial Court Cause No. 10C02-1609-PL-108

          ATTORNEY FOR APPELLANT C. Gregory Fifer F. Brad BensonApplegate Fifer Pulliam LLC Jeffersonville, Indiana

          ATTORNEYS FOR APPELLEE CLARK COUNTY BOARD OF ZONING APPEALS Douglas B. Bates Chelsea R. Stanley Stites & Harbison PLLC Jeffersonville, Indiana Zachary M. VanVactor Stites & Harbison PLLC Louisville, Kentucky

          ATTORNEYS FOR APPELLEE SIERRA CLUB Khushi K. Desai Earthjustice Washington, D.C. Jeffrey B Hyman Conservation Law Center Bloomington, Indiana

          May, Judge.

         [¶1] Essroc Cement Corporation ("Essroc") operates in Clark County, Indiana, on land zoned M2 for Heavy Industrial Use. To date, Essroc has always used coal to power its concrete production, but in the past decade Essroc began considering firing its concrete kiln with liquid waste derived fuels ("LWDF"). In December 2014, Essroc requested an informal determination from the Clark County Plan Commission ("the Plan Commission") about the permissibility of burning LWDF on land zoned M2. In late January 2015, the executive director of the Plan Commission gave Essroc a private letter indicating the burning of LWDF was permitted in an area zoned M2.

         [¶2] However, seventeen months later, Plan Commission staff issued a second private letter to Essroc that revoked the first private letter and indicated Essroc would need to obtain a variance or re-zone its property to an M3 district if it wished to burn LWDF. Essroc appealed that second private letter to the Clark County Board of Zoning Appeals ("the CCBZA"). The CCBZA held a public hearing and determined Essroc's proposed use of LWDF is prohibited in an area zoned M2. As a result, to burn LWDF, Essroc would need either to re-zone to M3, which is a Hazardous Waste Disposal District, or to petition for a use variance.

         [¶3] Essroc petitioned the trial court to review that administrative determination. The trial court affirmed the CCBZA's decision. Essroc filed a motion to correct error, which the trial court granted in part and denied in part. Essroc now appeals to this court, raising numerous procedural and substantive issues[1] that we reorganize and restate as:

I. Does the Clark County Zoning Ordinance ("CCZO") permit the burning of LWDF on land zoned M2 or only on land zoned M3?
II. Can Essroc nevertheless burn LWDF on its land zoned M2 because such burning is permitted as an "accessory use"?
III. Does Plan Commission staff have the authority to revoke a prior staff-issued, non-public, informal zoning determination letter by sending another staff-issued letter?
IV. If Plan Commission staff could revoke the initial staff determination, was Essroc entitled to notice and a public hearing before that revocation?
V. Is the CCBZA equitably estopped from requiring Essroc to rezone because Essroc had spent money in reliance on the Plan Commission's first determination letter?
VI. Should Finding 18, Finding 19, and Conclusion 7 be struck from the trial court's final order because the issue of whether the CCZO is preempted by federal law was not before the trial court?

         We affirm.

         Facts and Procedural History[2]

         [¶4] For over 100 years, Essroc has produced cement at its facility in Clark County, Indiana. To date, Essroc has fired its cement kiln using coal. However, Essroc wishes to begin firing its kiln with LWDF, which are an amalgam made of such liquids as household cleaning products, oils, nail polish, nail polish remover, perfume, paint, and ink. To burn LWDF, Essroc needs a permit from the Indiana Department of Environmental Management ("IDEM"), and to obtain that IDEM permit, Essroc needs a letter confirming it has CCBZA approval for converting from coal to LWDF.

         [¶5] On December 19, 2014, Essroc's legal counsel sent a letter to the Plan Commission asking "for certification of zoning compliance from the Clark County Plan Commission and/or Plan Director":

This firm represents Essroc. Essroc's production facilities at Speed are located on approximately 3500 acres in the unincorporated territory of Clark County with the manufacturing and production of the facility within the M2 (Heavy Industrial) zoning district as shown on the Clark County Zone Map.
To date Essroc has fueled its production facilities primarily with coal. It proposes to begin supplementing its coal usage with alternative fuels. These materials would include solvents, paints, etc. They would be flammable (as required to create heat for the kiln), and would be accordingly designated as "hazardous" due to such flammability. The alternative fuel materials would be delivered by generators to Essroc's Logansport, Indiana, plant for blending. This plant already has a permit to burn alternative fuels, and therefore presently has all of the equipment in place as required to properly handle these materials.
After blending at the Logansport plant, the materials would be transported by truck to the Speed plant. Essroc already has one (1) tank in place that it has used for waste oils in the past. The only capital addition Essroc currently proposes to make would be the addition of a second tank to enable replacement of up to fifty percent (50%) of the coal it now uses. However, Essroc presently anticipates that it will likely achieve replacement of coal in the 25-30% range, but plans to seek IDEM permitting to allow up to the 50% replacement level. The addition of this single tank is obviously a very small addition to Essroc's existing plant. Once the materials arrive at the Speed plant, they will be pumped into the existing and new tanks, and then pumped to the kiln utilizing existing equipment to use as a process fuel in manufacturing clinker, a work-in-process that ultimately becomes cement.
Enclosed are the materials that Essroc has provided to adjoining property owners as part of the environmental permitting process. Please not [sic] the graphic on page 4 illustrating the cement manufacturing process entitled "Cleaner Alternative Fuels Can Replace Coal". [sic] Again, the only change in Essroc's current production activities relates to the Alternative Fuel graphic on the right hand side of this page, as Essroc plans to replace a portion of the coal used in its kiln with such alternative fuels.
Essroc needs to demonstrate to IDEM that, if permitted, its plans will comply with all local zoning regulations. Permitted uses (g) ("concrete mixing", etc.), and (h) ("sand, gravel or aggregate wash production or processing") would appear to expressly permit the continued operation of Essroc's cement production facilities, regardless of whether alternative fuels are utilized as a supplement to coal. Essroc does not in any manner intend to construct or operate any facilities constituting a "landfill, waste transfer facilities, recycling facilities and related operations, or storage processing and recycling of hazardous materials" that would most likely require rezoning to M3 (Hazardous Waste Disposal District).
Based on the foregoing, Essroc would request the issuance of an assurance letter by the Plan Directoor [sic] and/or on behalf of the Plan Commission (in the manner you deem appropriate), certifying that (i) Essroc's current cement manufacturing operations are permitted as a matter of right, (ii) such operations will continue to be permitted as a matter of right subsequent to Essroc's conversion to alternative fuels usage; provided however, that Essroc complies with all applicable laws, regulations, and permits with respect to the handling and usage of such alternative fuels, and (iii) Essroc's use of such alternative fuels will not necessitate a change of zoning classification to M3 (Hazardous Waste Disposal District) for any portion of its facilities.
Should the Plan Commission or you require any additional information in order to be able to issue the requested assurance letter, please advise and we will attempt to accommodate your request promptly. Essroc representatives and I would also be glad to meet with the Plan Director, yourself, or other appropriate County officials as required to satisfy any remaining concerns regarding this request.

         (App. Vol. II at 53-4.)

         [¶6] Essroc and Plan Commission staff held informal meetings and, on January 26, 2015, the Executive Director of the Plan Commission sent a letter to Essroc that stated:

The Office of Planning & Zoning for Clark County[, ] Indiana concludes after our meeting on January 22, 2015, that Essroc's current cement manufacturing operation is permitted as a matter of right within the M2 (Heavy Industrial) district in which it is located. Such operations will continue to be permitted as a matter of right subsequent to Essroc's conversion to RCRA-regulated Liquid Waste Derived Fuels (kiln-ready fuel) usage at this site location as described and detailed to the Office of Planning, provided that Essroc complies with all applicable laws, regulations, permits, and local ordinances with respect to the handling, usage, and location of such alternative fuel. Essroc's use of such alternative fuels will not require a rezoning to M3 (Hazardous Waste Disposal District) for any portion of its facilities or the grant of any use variance.
The new storage tank and shed over the existing tank farm will require commercial building permits issued through the Office of Planning & Zoning by the Building Commissioner after all approvals or permits are received from other agencies, including the Indiana Department of Natural Resources for the approval of the location of the items in the floodway . . . and the Indiana Department of Environmental Management (IDEM) for the modifications to the Essroc facility for the construction of, and operations for, the use of these alternative fuels as specified in the RCRA and Clean Air Act permit applications to be prepared and submitted by Essroc.

(Id. at 61.)

         [¶7] In February 2016, IDEM held a meeting on Essroc's permit application for burning of LWDF. (Id. at 46.) At the next Plan Commission meeting, a group of Clark County citizens ("Concerned Citizens")[3] raised concerns about Essroc burning LWDF:

The Essroc Cement Corporation (Essroc) has applied for a modification of its Part 70 Clean Air Act permit that would allow it to burn liquid hazardous wastes that require comprehensive regulation under the Resource Conservation and Recovery Act (RCRA) at its Sellersburg, Indiana cement plant. RCRA is a federal law governing the generation, storage, transport and disposal of regulated hazardous wastes, which are among the most highly toxic substances produced in industrial manufacturing and business use. The Essroc plant is located in close proximity to homes, churches, schools, and daycare centers, and its permit application documents reveal that it already emits vast quantities of toxic pollution into the neighboring community - even without burning hazardous waste. Allowing the plant to burn hazardous waste would increase the toxic burden on families in this community, and would also create the risk of catastrophic events if the hazardous waste that Essroc seeks to store on site - which, by Essroc's admission is volatile and ignitable - should spill, leak, catch fire, or explode. Hazardous waste is dangerous to handle, transport, store, and incinerate because it consists of highly toxic chemicals in complex harmful mixtures.

(Id. at 66) (first paragraph of a ten-page submission to CCBZA).

         [¶8] On April 4, 2016, Concerned Citizens filed a petition with the CCBZA for administrative appeal of the letter of January 26, 2015. (Id. at 81-3.) The CCBZA dismissed that appeal because staff decisions must be appealed within thirty days, such that the letter of January 26, 2015, was "not an appealable administrative decision." (Id. at 122.) On June 17, 2016, Concerned Citizens filed a petition for judicial review by the Clark Circuit Court. (Id. at 101-12.) Essroc moved to intervene in that court case and then, on August 10, 2016, the case was dismissed with prejudice by joint agreement of Concerned Citizens, Essroc, and the CCBZA.

         [¶9] However, in the meantime, on June 27, 2016, the new Acting Executive Director of the CCBZA, Stacia Franklin, and the President of the Plan Commission, Jack Coffman, sent a letter to Essroc that provided, in necessary part:

In correspondence dated December 19, 2014, counsel for Essroc requested that the Clark County Plan Commission or the Plan Director issue a letter of assurance related to Essroc's current manufacturing operations and proposed future operations. In that letter Essroc stated:
"Essroc does not in any manner intend to construct or operate any facilities constituting a landfill, waste transfer facilities, recycling facilities and related operations or storage processing and recycling of hazardous materials' that would most likely require rezoning to M3 (hazardous waste disposal) district."
The staff of the office of Planning and Zoning for Clark County relied on the representations of Essroc's letter and issued the requested assurances in a letter dated January 26, 2015 subject to the further requirements stated in the assurance letter.
Clark County has just recently discovered that on February 26, 2015, Essroc submitted to IDEM, an initial part B permit application ("RCRA Permit") (VFC#80012744) for the Esroc [sic] Speed, Indiana facility to request addition of a LWDF process to the Speed facility. On the "Type of Application" section, Essroc designated "Hazardous Waste Storage Facility; Hazardous Waste Treatment Facility". [sic] Additionally, in February of 2015, Essroc applied for a significant modification of its Part 70 Operation Permit ("Title V Permit") in order to begin utilizing LWDF. IDEM's preliminary findings conclude that Essroc will construct a RCRA LWDF waste receiving and storage facility at the Speed, Indiana facility.
Therefore, the Office of Planning and Zoning of Clark County, Indiana still concludes that Essroc's current cement manufacturing operation is permitted as a matter of right but based upon these newly discovered facts, in order to add the uses which are the subject of IDEM approval, Essroc must file for rezoning to an M-3 zone and/or file for a variance prior to any such use at its Speed facility.

(Id. at 126-7.) Essroc filed a petition with the CCBZA for administrative appeal of that Determination. The CCBZA held a hearing and then affirmed the Determination in an order that provided, in necessary part:

2. This action was brought by Essroc pursuant to I.C. 36-7-4-918.1 (1) claiming to be aggrieved by the Determination relating to its intended burning of hazardous materials, and the requirement that Essroc file a petition to rezone its real estate from its present M-2 zoning to an M-3 zoning designation or in the alternative to file a Petition for a use variance of its real estate to burn hazardous wastes, to store hazardous wastes and treat hazardous wastes. The contents of the Determination are incorporated herein by reference as if full [sic] set out herein.
3. This action is necessary and is also brought pursuant to Article XXII of the Clark County Zoning Ordinance (the "Ordinance")[.]
4. The real estate which is the subject of this appeal is that of Essroc at 301 U.S. 31 Sellersburg, Indiana (the "Real Estate"), is currently zoned "M2 (Heavy Industrial)" and has been so zoned at all pertinent times.
5. On January 26, 2015, without a public hearing and/or public meeting, but apparently in a meeting with Essroc on January 22, 2015, the then Executive Director of the Clark County Plan Commission, Michael Tackett issued a determination that Essroc Cement was able to, as a matter of right, burn regulated liquid waste-derived fuel at its location without a zoning change and/or a zoning variance from its M2 zoning district (the "Interpretation").
6. The "M2 (Heavy Industrial)" in the Ordinance does not allow the destruction or recycling [or] the burning of hazardous waste.
7. The Intentions of Article XVI: M2 Heavy Industrial in the Ordinance state:
Heavy industrial district is intended for those heavy industrial uses that are typically characterized by objectionable factors which are exceedingly difficult to eliminate. These industries are therefore buffered by efficient [sic] areas that minimize any adverse effects and wherever practical the district is removed as far as possible from residential areas buffered by intervening industrial districts.
8. Pursuant to the Ordinance the only zoning district in Clark County, Indiana allowing the burning of hazardous waste is an "M3 Hazardous Waste Disposal District" in Clark County, Indiana, and the same is described in Article XVII of the Ordinance.
9. The Intentions of Article XVII: M3 Hazardous Waste Disposal District in the Ordinance state:
This district is restricted to facilities for the disposal, destruction, or recycling of toxic chemicals, radioactive wastes, heavy metals, asbestos or other forms of hazardous waste whether through incineration, land filling, or other mechanical, chemical, or technological means.
10. Under "Permitted Uses" in Article XVII (M3) the Ordinance further provides in pertinent part: "No building, structure or premises shall be used, arranged or designed to be use[d] except for one or more of the following uses:
(e) Storage processing and recycling of hazardous materials."
11. Additionally under the Ordinance the M3 district requires special setback requirements: "No M3 use shall be located within one mile of any business, residence, church, school, health care facility, or child care facility as measured from the point of admission discharge or regulate[d] activity to the nearest property line."
12. In a letter to David Nachand dated December 19, 2014, Essroc's counsel (the "Essroc Letter") acknowledges the alternative fuels ("solvents, paints, etc . . .") are "hazardous" and further indicates these hazardous materials would be "transported by truck" to Essroc's Speed, Indiana facility from its Logansport facility then stored at the Speed, Indiana facility until pumped for processing as fuel.
13. Additionally in the Essroc Letter to David Nachand, Essroc's counsel represented, it "does not in any manner intend to construct or operate facilities constituting a landfill, waste transfer facilities, recycling facilities and related operations or storage processing and recycling of hazardous materials that would most likely require rezoning to M# [sic] (hazardous waste disposal) District."
14. As background evidence reveals, in 1993 the Clark County Commissioners responded/reacted to the very same issue after Essroc had applied for a similar permit in 1992 to burn hazardous waste at its Speed, Indiana facility by the passage of the M3 zoning designation.
15. In principle Essroc's present intended use is no different than its 1992 request to burn hazardous fuels and since that time the Clark County Commissioners enacted legislation governing hazardous materials in the County and created the M3 district in the Ordinance.
16. The Interpretation by the then Executive Director's [sic] was based upon the representations made in the Essroc Letter by Essroc's counsel.
17. That the Interpretation of the then Executive Director of the Plan Commission was the result of a private meeting (not a public meeting or hearing) and without notice to neighboring property owners as required by notice requirements of the Ordinance pertaining to Essroc's requested burning of hazardous materials in violation of the Ordinance.
18. The Interpretation by the then Executive Director was improper [and] incorrect[, ] as the intended use by Essroc, according to its own filing with the Indiana Department of Environmental Management ("IDEM") for a RCRA Permit (VFC#80012744) its new intended use [sic] stated it as a "Hazardous Waste ...

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