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302 Nebraska Report

PROKOP v. LOWER LOUP NRD

Cite as 302 Neb. 10

Robert J. Prokop, appellant and cross-appel

v. Lower Loup Natural Resou

District et al., appelle

and cross-appellan

___ N.W.2d ___

Filed January 11, 2019. No. S-18-082.

1. Administrative Law: Judgments: Appeal and Error. A judgment or 

final order rendered by a district court in a judicial review pursuant to 

the Administrative Procedure Act may be reversed, vacated, or modified 

by an appellate court for errors appearing on the record.

2. ____: ____: ____. When reviewing an order of a district court under 

the Administrative Procedure Act for errors appearing on the record, the 

inquiry is whether the decision conforms to the law, is supported by competent evidence, and is neither arbitrary, capricious, nor unreasonable.

3. Judgments: Appeal and Error. Whether a decision conforms to law 

is by definition a question of law, in connection with which an appellate court reaches a conclusion independent of that reached by the 

lower court.

4. ____: ____. An appellate court, in reviewing a district court judgment 

for errors appearing on the record, will not substitute its factual findings for those of the district court where competent evidence supports 

those findings.

5. Natural Resources Districts: Political Subdivisions: Legislature. A 

natural resources district, as a political subdivision, has only that power 

delegated to it by the Legislature, and an appellate court strictly construes a grant of power to a political subdivision.

6. Natural Resources Districts. A natural resources district possesses and 

can exercise the following powers and no others: first, those granted 

in express words; second, those implied in or incident to the powers 

expressly granted; and third, those essential to the declared objects and 

purposes of the district—not simply convenient, but indispensable.

Nebraska Supreme Court Online Library

www.nebraska.gov/apps-courts-epub/

01/25/2019 09:13 AM CST
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7. Administrative Law. Generally, for purposes of construction, a rule or 

order of an administrative agency or political subdivision is treated like 

a statute.

8. ____. Absent a statutory or regulatory indication to the contrary, language contained in a rule or regulation is to be given its plain and ordinary meaning.

9. ____. A rule is open for construction only when the language used 

requires interpretation or may reasonably be considered ambiguous.

10. Administrative Law: Political Subdivisions: Appeal and Error. An 

appellate court accords deference to an agency or political subdivision’s 

interpretation of its own rules unless plainly erroneous or inconsistent.

11. Statutes. A court must attempt to give effect to all parts of a statute, 

and if it can be avoided, no word, clause, or sentence will be rejected as 

superfluous or meaningless.

12. Statutes: Words and Phrases. In statutory interpretation, “shall,” as 

a general rule, is considered mandatory and inconsistent with the idea 

of discretion.

13. Due Process. Due process principles protect individuals from arbitrary 

deprivation of life, liberty, or property without due process of law.

14. ____. Procedural due process claims require a two-step analysis: (1) 

whether the plaintiff has asserted a life, liberty, or property interest that 

is protected by the Due Process Clause and (2) whether the plaintiff was 

deprived of that interest without sufficient process.

15. Administrative Law: Due Process. A party appearing in an adjudication hearing before an agency or tribunal is entitled to due process protections similar to those given to litigants in a judicial proceeding.

16. Due Process: Notice. Due process does not guarantee an individual 

any particular form of state procedure. Instead, the requirements of due 

process are satisfied if a person has reasonable notice and an opportunity to be heard appropriate to the nature of the proceeding and the 

character of the rights which might be affected by it.

17. Administrative Law: Due Process: Notice: Evidence. In proceedings 

before an administrative agency or tribunal, procedural due process 

requires notice, identification of the accuser, factual basis for the accusation, reasonable time and opportunity to present evidence concerning the 

accusation, and a hearing before an impartial board.

18. Due Process: Notice. Due process requires notice reasonably calculated 

to inform the party to the action of the subject and issues involved in 

the proceeding.

19. Administrative Law. While similar to a judicial proceeding, an adjudication hearing before an agency does not guarantee an individual any 

particular form of state procedure.
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PROKOP v. LOWER LOUP NRD

Cite as 302 Neb. 10

20. ____. Administrative bodies have the authority to provide discovery 

which must be exercised judicially and not arbitrarily.

21. Due Process: Property: Notice. Due process involving deprivation of 

a significant property interest requires notice and an opportunity to be 

heard that is appropriate to the nature of the case.

22. Due Process: Notice: Time. Due process depends on, in part, whether 

the notice was sufficient to provide the party a reasonable opportunity to 

confront and cross-examine adverse witnesses and present evidence.

23. Administrative Law: Due Process: Natural Resources Districts: 

Notice. Due process does not require that a natural resources district 

provide notice of its specific evidence to a party prior to a hearing.

24. Property. A takings analysis begins with an examination of the nature 

of the owner’s property interest.

25. Waters. Ground water, as defined by Neb. Rev. Stat. § 46-706 (Reissue 

2010), is owned by the public, and the only right held by an overlying 

landowner is in the use of the ground water.

26. Constitutional Law: Waters: Appurtenances: Property. The right of 

an owner of overlying land to use ground water is an appurtenance constituting property protected by Neb. Const. art. I, § 21.

27. Waters: Public Policy. Through its police power, the State has the 

power to determine public policy with regard to ground water and can 

alter the common law governing the use of ground water.

28. Property: Constitutional Law. The appropriate exercise of police 

power occurs where an owner is denied the unrestricted use or enjoyment of his property, or his property is taken from him, because his use 

or enjoyment of such property is injurious to the public welfare.

29. Waters. Appropriate use of police power includes that the State place 

limitations on the withdrawals of ground water in times of shortage.

30. Administrative Law: Appeal and Error. In a de novo review on the 

record of an administrative order, the district court is required to make 

independent factual determinations based upon the record, and the court 

reaches its own independent conclusions with respect to the matters 

at issue.

Appeal from the District Court for Valley County: Karin 

Noakes, Judge. Affirmed.

Brian C. Buescher and Dwyer Arce, of Kutak Rock, L.L.P., 

for appellant.

Blake E. Johnson and Katherine J. Spohn, of Bruning Law 

Group, for appellees.
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PROKOP v. LOWER LOUP NRD

Cite as 302 Neb. 10

Donald G. Blankenau and Kennon G. Meyer, of Blankenau, 

Wilmoth & Jarecke, L.L.P., for amicus curiae Nebraska 

Groundwater Coalition.

Heavican, C.J., Cassel, Stacy, Funke, and Pap

Funke, J

Robert J. Prokop appeals from the district court’s order 

affirming the findings and modifying a cease and desist order 

of the Lower Loup Natural Resources District (LLNRD) Board 

directing Prokop to suspend use of ground water wells for 

noncompliance with LLNRD’s annual reporting requirements.

Prokop challenges LLNRD’s authority under the Nebraska 

Ground Water Management and Protection Act (GWMPA)1 and 

LLNRD rules which require operators to provide actual crop 

yield data in their annual reports and to impose sanctions for 

noncompliance with LLNRD reporting requirements. Prokop 

further argues that LLNRD failed to provide him sufficient 

due process in its proceedings on whether he complied with 

LLNRD reporting requirements and that LLNRD’s suspension of his ground water rights constituted a taking without 

just compensation. Prokop additionally challenges the district 

court’s refusal to receive certain exhibits during his appeal to 

the district court and its failure to award him attorney fees. 

LLNRD and the board cross-appeal and argue the district 

court improperly reduced the duration of Prokop’s suspension of ground water access. For the reasons set forth herein, 

we affirm.

I. BACKGROUND

LLNRD is a natural resources district (NRD) authorized by 

GWMPA to regulate certain activities which may contribute to 

ground water contamination due to nitrate nitrogen and other 

contaminants.2 GWMPA enables NRD’s to establish ground 

1 See Neb. Rev. Stat. §§ 46-701 to 46-756 (Reissue 2010 & Cum. Supp. 

2016).

2 § 46-704.
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water management areas for the protection of ground water 

quality.3 GWMPA requires NRD’s to maintain a ground water 

management plan that, among other obligations and to the 

extent possible, identifies the levels and sources of ground 

water contamination within the district; ground water quality 

goals; long-term solutions necessary to prevent the levels of 

ground water contaminates from becoming too high and to 

reduce high levels sufficiently to eliminate health hazards; and 

practices recommended to stabilize, reduce, and prevent the 

occurrence, increase, or spread of ground water contamination.4

 GWMPA authorizes NRD’s to adopt rules and regulations 

necessary to discharge the administrative duties assigned under 

GWMPA and to require such reports from ground water users 

as may be necessary.5 GWMPA provides that a ground water 

user who violates any controls, rules, or regulations “shall be 

subject to the imposition of penalties imposed through the controls adopted by the district, including, but not limited to, having any allocation of water granted or irrigated acres certified 

by the district reduced in whole or in part.”6 Cease and desist 

orders may also be issued by NRD’s against ground water 

users following 3 days’ notice to the person affected stating the 

contemplated action and, in general, the grounds for the action 

and following a reasonable opportunity to be heard.7

Pursuant to GWMPA directives, LLNRD established a 

ground water management area comprising a large portion 

of its geographical area, adopted water quality and pollution 

control as one of its goals, and enacted rules and regulations to 

implement its obligations under GWMPA. Rule 7 of LLNRD’s 

“Groundwater Management Area Rules & Regulations” 

directs that LLNRD is divided into 28 ground water quality 

3 § 46-712(1)(b).

4 § 46-709.

5 § 46-707(1).

6 § 46-746(1).

7 § 46-707(1)(h). See, also, § 46-746(1).
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management subareas and provides that each subarea may be 

subject to water quality controls in three separate phases based 

upon median nitrate nitrogen levels. Under “Phase III,” rule 

7 directs that an operator—a person with direct control over 

day-to-day farming operations of the land—must, among other 

obligations, “[s]ubmit, on forms provided by [LLNRD], a 

report of yearly water tests, flow meter reading, water applied, 

soil tests, crops planted, yield goals, nitrogen applied, and other 

field operations required prior to January 31st . . . .” The forms 

which LLNRD provides to operators require specific information of farming operations, including number of acres, the crop 

planted, expected yield, nitrogen readings and application, 

water applied, irrigation date, and actual crop yield. Operators 

are also required to sign and date the forms. To enforce compliance with this obligation and other controls, rules, and regulations adopted by LLNRD, rule 2 provides:

[LLNRD] shall have the authority to enforce these rules 

and regulations for the . . . protection of groundwater 

quality . . . by issuing cease and desist orders in accordance with the procedure hereinafter specified and by 

bringing appropriate actions in the District Court for the 

county in which any violations occur for enforcement of 

such orders.

Since 1962, Prokop has operated a farm on property he 

owns within LLNRD’s regulated area in which he irrigates a 

significant portion of his crops. Prokop’s property is within a 

phase III subarea of the district, and he is required to submit 

yearly reports to LLNRD on its forms provided.

In 2013, prior to the actions underlying the present case, 

Prokop was subject to an enforcement action by LLNRD in 

the district court for Nance County under case No. CI 13-01. 

LLNRD initiated that case against Prokop for illegal wells and 

failure to submit completed forms for 2010 and 2011 by not 

providing the actual crop yield data for those years. The district 

court found Prokop in violation of LLNRD’s reporting requirements and ordered him to provide the required reports.
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PROKOP v. LOWER LOUP NRD

Cite as 302 Neb. 10

1. Administrative A

The instant case involves Prokop’s annual reports from 

2015 and 2016 and arose from LLNRD concerns about missing information from those reports, including actual crop 

yield data, irrigation data, nitrogen application, and dates and 

signatures. Due to these concerns, LLNRD’s board voted in 

April 2017 to file a complaint against Prokop and issued a 

“Notice of Intent to Issue Cease and Desist Order and Impose 

Penalties for Failing to Submit Annual Reporting” which was 

served on Prokop on May 2. In the notice, LLNRD alleged that 

Prokop “failed to submit timely and complete annual reports 

. . . for the [2015 and] 2016 crop year[s],” that “LLNRD sent 

multiple notice to [Prokop] requesting he submit the annual 

reports,” and that “LLNRD has reason to believe [Prokop] 

has intentionally and repeatedly violated the annual reporting 

requirements.” LLNRD stated its belief that Prokop “should 

be subject to penalties pursuant to the GWMPA and a cease 

and desist order should be issued.” The notice additionally 

provided that Prokop “has until June 1, 2017 to submit the 

complete annual reports” and informed Prokop of “LLNRD’s 

intention to enforce the penalty provisions of the GWMPA in 

the event [Prokop] fails to submit timely and complete annual 

reporting in accordance with this Notice.” In particular, the 

notice stated LLNRD’s intention to “de-certify [Prokop’s] irrigated acres” and “seek maximum civil penalties.” The notice 

also informed Prokop that “a hearing is scheduled regarding 

this Notice at 5:00 p.m. on May 25, 2017,” “[t]he hearing 

shall be conducted on the record,” Prokop “will be given 

the opportunity to present any evidence or testimony he may 

have with respect to the violations identified in this Notice,” 

Prokop may appear through counsel, and the board will determine whether a cease and desist order should be issued based 

on the record developed at the hearing.

A hearing before the board on LLNRD’s notice was held 

on May 25, 2017. At the hearing, LLNRD offered and the 

board received a copy of LLNRD’s ground water rules and 
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Cite as 302 Neb. 10

regulations, a blank “Groundwater Management Area Annual 

Report Form,” the notice, the return of service of the notice, 

proofs of publication of the notice, the complaint and order in 

case No. CI 13-01, Prokop’s “Groundwater Management Area 

Annual Report Form” for the 2015 crop year, and Prokop’s 

“Groundwater Management Area Annual Report Form” for the 

2016 crop year.

LLNRD presented testimony from the assistant general manager of LLNRD. He testified to the rules and regulations 

adopted by LLNRD. He explained Prokop’s property is within 

a subarea of the district that is designated “Phase III” and the 

rules that apply to the property, including Prokop’s annual 

reporting obligations as the operator.

LLNRD also presented testimony from an agronomy technician for LLNRD. He testified that the subarea in which 

Prokop’s land is located has an issue with ground water 

nitrates which are unsafe for consumption at certain levels. 

He explained that the purpose of LLNRD’s annual reports is 

to record nitrogen characteristics and develop a plan to reduce 

nitrate contamination. He testified that actual crop yield data 

is part of the factors that record nitrogen characteristics as it 

helps determine how many pounds of nitrogen are removed 

from the field.

The agronomy technician testified that he reviewed Prokop’s 

2015 and 2016 reports and that the 2015 report was incomplete, because it failed to indicate an actual crop yield and 

was missing a signature, and that the 2016 report was late and 

incomplete, because it failed to indicate actual crop yields, 

failed to provide the irrigation data, failed to provide the nitrogen applications, and was not signed or dated. He explained 

that Prokop’s reporting insufficiencies are ongoing and that 

LLNRD has had issues with the quality of Prokop’s reporting 

since 2009.

Prokop presented no evidence or witnesses, but he made 

factual arguments during the hearing and cross-examined both 

LLNRD witnesses. Prokop stipulated to the receipt of the 
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notice and acknowledged publication in the newspapers of 

general circulation within the district. However, Prokop repeatedly objected to the hearing, arguing that he was not provided 

LLNRD’s evidence with sufficient time prior to the hearing to 

enable a fair opportunity to develop his defense. He additionally challenged the applicability of the reports’ actual crop 

yield requirements, stating he “has long taken the position 

that the LLNRD’s demand that farmers provide actual yield 

information is unnecessary from a scientific standpoint and the 

request for such information is a governmental overreach not 

allowed or required by law.”8

After the presentation of evidence and argument by the parties, LLNRD’s board took the matter under advisement and 

delayed any action until June 22, 2017, the next regularly 

scheduled meeting. The delay allowed Prokop additional time 

to meet the June 1 deadline set out in the notice to Prokop. 

However, Prokop failed to complete the reports and the board 

voted at the June 22 meeting to find Prokop had violated 

LLNRD reporting rules by failing to submit timely and complete reports for the 2015 and 2016 crop years.

Pursuant to its vote on June 29, 2017, LLNRD’s board executed a cease and desist order to impose penalties, which order 

was served on Prokop July 6. Through this order, the board 

found the following: Prokop’s land was located in a phase III 

subarea; Prokop’s 2015 annual report failed to include data 

on actual crop yields, nitrogen application, and a signature; 

and Prokop’s 2016 annual report was filed after the January 

31 deadline and failed to include data on actual crop yields, 

nitrogen application, water applied, and Prokop’s signature. 

The order also noted Prokop’s history of noncompliance with 

LLNRD’s reporting requirements. In consideration of its findings and Prokop’s noncompliant history, the board ordered:

1) [Prokop] and all heirs, successors, assigns, or agents 

cease and desist the use of all groundwater irrigation 

8 Brief for appellant at 17.
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wells on the Property for a period of four (4) years 

commencing January 1, 2018 and continuing through 

December 31, 2021;

2) [Prokop] to submit complete annual report forms 

for the Property for the 2015 crop year and the 2016 crop 

year by January 31, 2018; and

3) [Prokop] to submit timely and complete annual 

report forms for the Property for all subsequent crop 

years.

2. Appeal to District Co

Prokop filed a pro se petition for review in the district court 

in June 2017, prior to the board’s executing the cease and 

desist order. After obtaining counsel, Prokop filed an amended 

petition in July, claiming: the cease and desist order was not 

supported by the evidence; LLNRD’s hearing and actions were 

not conducted in accordance with Nebraska law, LLNRD’s 

rules and regulations, and the requirements of due process; 

the board’s order was in violation of Nebraska law, LLNRD’s 

rules and regulations, and the requirements of due process; the 

cease and desist order constituted a taking without just compensation and the due process required for such action; and 

the cease and desist order was issued for reasons not allowed 

by law.

At a hearing on Prokop’s amended petition, Prokop offered 

exhibits 4 and 5 to support his claims that LLNRD’s actions, 

the hearing, and the cease and desist order were in violation 

of his due process rights. LLNRD objected to these exhibits 

because they were not part of the administrative record, while 

Prokop argued these exhibits fell within an exception for evidence showing a procedural due process violation.

Exhibit 4 was an affidavit from Mitch Husmann, a location 

manager for a co-op, who sold Prokop and his tenants fertilizer and assisted Prokop in filling out the annual reports for 

LLNRD. Husmann explained that he would work with Prokop 

to fill out the reports, Prokop would sign them, and they would 
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be delivered to LLNRD. While this is what occurred in 2015, 

Husmann provided that the typical procedure was interrupted 

in 2016 because Prokop’s new tenant purchased fertilizer 

through another sales representative. Therefore, Husmann did 

not have all the information necessary to fill out Prokop’s 

forms, so he filled out what he could and delivered the incomplete 2016 report to LLNRD in mid-January under the understanding that Prokop would come in to complete it.

Exhibit 5 was an affidavit from Prokop detailing his relationship with Husmann and explaining that he was unaware 

until the hearing that the typical procedure was not followed 

for the 2016 report due to his tenant’s using a different sales 

representative. The affidavit also asserted that Prokop believed 

the notice concerned only his refusal to provide actual crop 

yield data and that the notice failed to mention the 2016 reports 

were not signed and submitted in the same manner Husmann 

had submitted previous reports.

The district court entered an order on the petition in 

January 2018. The court stated that exhibits 4 and 5 were 

not received because they are outside the scope of the official record. The order then affirmed the cease and desist 

order’s findings. First, the court determined LLNRD rules 

and GWMPA enable LLNRD to require actual crop yield 

data on its annual reports as “‘other field operations’” and 

suspend ground water rights for noncompliance. Second, the 

court determined LLNRD complied with its due process obligations. Specifically, the court found the notice adequately 

informed Prokop of the purpose of the hearing and the allegations against him. Because the court found Prokop was 

informed of the purpose of the hearing and the court’s understanding that due process does not require notice of evidence 

to be presented at an administrative hearing, the court found 

Prokop was not denied due process as a result of insufficient 

notice from LLNRD of the evidence it would present. The 

court also found the order’s factual findings were supported 

by the evidence. Finally, the court determined the purpose of 
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the annual reports serves a substantial and legitimate government interest in preventing ground water contamination and, 

therefore, the cease and desist order is an appropriate exercise 

of police power that does not deprive Prokop of property 

rights without just compensation.

However, the district court’s order modified the cease and 

desist order’s penalty. The district court found the suspension of 4 years to be an unreasonable use of LLNRD’s police 

power under the facts of the case and determined the public 

health and welfare could be preserved by imposing a less 

severe restriction. Therefore, the court modified the penalty 

from the 4-year suspension of Prokop’s ground water rights 

to a 1-year suspension with the possibility of 3 additional 

years if Prokop continues to violate LLNRD’s reporting 

requirements.

II. ASSIGNMENTS OF ERROR

Prokop assigns, restated, that the district court erred in 

affirming the board’s order and determining (1) LLNRD had 

the authority under LLNRD rules and GWMPA to require 

Prokop to provide information in his annual reports, including actual crop yield data; (2) LLNRD had the authority under 

LLNRD rules and GWMPA to impose a suspension of ground 

water access as a penalty for noncompliance with LLNRD 

rules; (3) LLNRD did not violate Prokop’s right to procedural 

due process and deny him a reasonable opportunity to be 

heard; (4) LLNRD did not erroneously limit the possibility of 

competent judicial review by violating Prokop’s due process 

rights; and (5) LLNRD’s suspension of Prokop’s ground water 

access did not constitute a taking without just compensation. Prokop also assigns the district court erred in sustaining 

LLNRD’s objection to Prokop’s exhibits 4 and 5 and failing to 

award Prokop attorney fees.

LLNRD and the board assign on cross-appeal that the district court erred in modifying the duration of the penalty 

imposed by LLNRD.
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III. STANDARD OF REVIEW

[1,2] A judgment or final order rendered by a district court 

in a judicial review pursuant to the Administrative Procedure 

Act (APA) may be reversed, vacated, or modified by an appellate court for errors appearing on the record.9

 When reviewing 

an order of a district court under the APA for errors appearing 

on the record, the inquiry is whether the decision conforms to 

the law, is supported by competent evidence, and is neither 

arbitrary, capricious, nor unreasonable.10

[3,4] Whether a decision conforms to law is by definition a 

question of law, in connection with which an appellate court 

reaches a conclusion independent of that reached by the lower 

court.11 An appellate court, in reviewing a district court judgment for errors appearing on the record, will not substitute its 

factual findings for those of the district court where competent 

evidence supports those findings.12

IV. ANALYSIS

1. LLNRD Authority to R

Actual Crop Yield 

Prokop first assigns the district court erred in determining 

LLNRD had authority to require Prokop to provide actual crop 

yield data.

[5,6] LLNRD, as a political subdivision, has only that power 

delegated to it by the Legislature, and we strictly construe 

a grant of power to a political subdivision.13 An NRD possesses and can exercise the following powers and no others: 

first, those granted in express words; second, those implied in 

9 Medicine Creek v. Middle Republican NRD, 296 Neb. 1, 892 N.W.2d 74 

(2017).

10 Id.

11 Stejskal v. Department of Admin. Servs., 266 Neb. 346, 665 N.W.2d 576 

(2003).

12 Id.

13 Medicine Creek, supra note 9.
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or incident to the powers expressly granted; and third, those 

essential to the declared objects and purposes of the district—

not simply convenient, but indispensable.14

As stated above, GWMPA directs NRD’s to regulate certain 

activities which may contribute to ground water contamination due to nitrate nitrogen and other contaminants.15 GWMPA 

authorizes NRD’s to adopt rules and regulations necessary to 

discharge the administrative duties assigned under GWMPA, 

require such reports from ground water users as may be necessary, and issue cease and desist orders to enforce any provisions of GWMPA.16

LLNRD rule 7 directs that each subarea of the district may 

be subject to water quality controls in three separate phases 

based upon median nitrate nitrogen levels. Under phase III, the 

phase Prokop’s land was designated, rule 7 directs that an operator must “[s]ubmit, on forms provided by [LLNRD], a report 

of yearly water tests, flow meter reading, water applied, soil 

tests, crops planted, yield goals, nitrogen applied, and other 

field operations required prior to January 31st . . . .” Among 

other information, the forms which LLNRD provides to operators require actual crop yield data.

Prokop claims rule 7 fails to authorize LLNRD to collect 

actual crop yield data, because the rule does not include it in 

the list of operators’ reporting obligations. Prokop also argues 

that actual crop yield data was not implicitly included under 

the phrase “other field operations,” because actual yield data 

is not an operation.

[7-10] Generally, for purposes of construction, a rule or order 

of an administrative agency or political subdivision is treated 

like a statute.17 Absent a statutory or regulatory indication to 

14 Id.

15 § 46-704.

16 § 46-707(1).

17 See Nebraska Protective Servs. Unit v. State, 299 Neb. 797, 910 N.W.2d 

767 (2018).
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the contrary, language contained in a rule or regulation is to 

be given its plain and ordinary meaning.18 A rule is open for 

construction only when the language used requires interpretation or may reasonably be considered ambiguous.19 We accord 

deference to an agency or political subdivision’s interpretation 

of its own rules unless plainly erroneous or inconsistent.20

Here, LLNRD’s interpretation of “other field operations” 

to include actual crop yield data is not inconsistent or plainly 

erroneous. The use of “other field operations” requires interpretation, and LLNRD has interpreted it to include data on 

actual crop yield. In the blank “Groundwater Management 

Area Annual Report Form,” as well as Prokop’s reports from 

crop years 2015 and 2016, LLNRD asks for actual crop 

yield data along with other information from operators’ farming operations. LLNRD’s agronomy technician testified that 

requiring actual crop yield is important to LLNRD’s adopted 

goals of water quality and pollution control and LLNRD’s 

obligations under GWMPA to implement these goals. He testified that the actual crop yield data is used in connection with 

the other farming operations data to record nitrogen characteristics and develop a plan to reduce nitrate contamination, 

because actual crop yield data helps determine how many 

pounds of nitrogen are removed from the field. LLNRD, in 

requiring the data on the reports, clearly interpreted “other 

field operations” to encompass actual crop yield data, which is 

supported by LLNRD’s utilization of the data in implementing 

its statutory duties.

Prokop contends that interpreting “other field operations” to 

include actual crop yield data is inconsistent with a plain reading of rule 7, because actual crop yield data is not an operation. However, such a reading is incorrect. Rule 7 lists specific 

field operations, including items such as “soil tests” and “yield 

18 Id.

19 Id.

20 See id.
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goals.” If actual crop yield data, which is the end product 

of field operations, is not field operations data, than neither 

would soil tests as the state of the soil during field operations 

or yield goals which are what operators believe they will produce through field operations even though soil tests and yield 

goals are explicitly included in the list of required field operations data.

Prokop additionally contends that interpreting “other field 

operations” to include actual crop yield data is inconsistent 

and plainly erroneous, because the purpose of rule 7 is to 

implement LLNRD’s goals of water quality and pollution 

control through the reduction of nitrogen contamination, and 

actual crop yield data is unnecessary to do so. However, we 

cannot say that requiring actual crop yield data is clearly 

erroneous to reducing nitrogen contamination. Moreover, the 

record contains testimony on how actual yield data is relevant 

to a determination of nitrogen levels removed from the soil 

and how it is helpful to LLNRD and operators in determining 

other relevant data required in the annual reporting. Thus, on 

the record before us, we cannot say the interpretation of “other 

field operations” to include actual crop yield data was inconsistent and plainly erroneous due its relationship to LLNRD’s 

stated goals.

In consideration of all of the above, the district court did not 

err in determining LLNRD had the authority to require actual 

crop yield data.

2. LLNRD Authority to Impose S

of Ground Water 

Prokop next assigns the district court erred in determining 

LLNRD had authority to impose a suspension of ground water 

access for a violation of LLNRD reporting requirements.

Under § 46-707(1), NRD’s may adopt rules and regulations 

necessary to discharge the administrative duties assigned under 

GWMPA; require such reports from ground water users as may 

be necessary; and issue cease and desist orders to enforce any 

provisions of GWMPA.
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Under § 46-746(1), any person who violates any controls, 

rules, or regulations “shall be subject to the imposition of 

penalties imposed through the controls adopted by the district, 

including, but not limited to, having any allocation of water 

granted or irrigated acres certified by the district reduced in 

whole or in part.”

Additionally, LLNRD enacted rule 2, which addresses 

enforcement of noncompliance with LLNRD rules and regulations and GWMPA. Rule 2 provides:

[LLNRD] shall have the authority to enforce these rules 

and regulations for the . . . protection of groundwater 

quality . . . by issuing cease and desist orders in accordance with the procedure hereinafter specified and by 

bringing appropriate actions in the District Court for the 

county in which any violations occur for enforcement of 

such orders.

Prokop contends the language of § 46-746(1) that

[a]ny person who violates . . . any controls, rules, or 

regulations adopted by [an NRD] relating to a management area shall be subject to the imposition of penalties 

imposed through the controls adopted by the district, 

including, but not limited to, having any allocation of 

water granted or irrigated acres certified by the district 

reduced in whole or in part

requires LLNRD to adopt rules and regulations that specifically list the penalties available. Further, Prokop argues, such 

an interpretation required LLNRD to adopt rules and regulations which explained that a violation of LLNRD reporting 

requirements could result in the allocation of ground water 

reduced in whole or in part.

[11] Contrary to Prokop’s argument, a “penalty” and a 

“control” under GWMPA are separate and distinct terms. 

A court must attempt to give effect to all parts of a statute, 

and if it can be avoided, no word, clause, or sentence will 

be rejected as superfluous or meaningless.21 The inclusion 

21 Wisner v. Vandelay Investments, 300 Neb. 825, 916 N.W.2d 698 (2018).
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of both terms leads to the determination that the words are 

not synonymous.

Section 46-746(1) enables an NRD to enforce a ground 

water user’s obligations under GWMPA and the rules and regulations of an NRD by imposing penalties, including, but not 

limited to, having any allocation of water granted or irrigated 

acres certified by the district reduced in whole or in part by 

utilizing the procedure adopted in the rules and regulations of 

an NRD. Section 46-746(1) does not require an NRD to restate 

in its rules and regulations that a violation could result in a 

reduction of ground water access. Instead, § 46-746(1) articulates one specific penalty which an NRD can impose upon the 

violator—the reduction of allocated water. As to the controls 

adopted by an NRD, in this case, LLNRD adopted rule 2, 

which enables LLNRD to issue cease and desist orders following the procedure outlined in the subsequent rules.

[12] Such a determination aligns with our opinions in Loup 

City Pub. Sch. v. Nebraska Dept. of Rev.22 and Goodyear 

Tire & Rubber Co. v. State.

23 In Loup City Pub. Sch., we 

addressed the question of whether the Department of Revenue 

was required to promulgate rules and regulations under Neb. 

Rev. Stat. § 79-3809 (Reissue 1994).24 We concluded that 

the department was required to do so.25 That statute, which 

has since been amended and recodified, provided in relevant 

part: “Establishment of the adjusted valuation shall be based 

on assessment practices established by rule and regulation 

adopted and promulgated by the Department of Revenue.”26

We noted that in statutory interpretation, “shall,” as a general 

22 Loup City Pub. Sch. v. Nebraska Dept. of Rev., 252 Neb. 387, 562 N.W.2d 

551 (1997).

23 Goodyear Tire & Rubber Co. v. State, 275 Neb. 594, 748 N.W.2d 42 

(2008).

24 Loup City Pub. Sch., supra note 22.

25 Id.

26 § 79-3809(1) (now codified at Neb. Rev. Stat. § 79-1016 (Supp. 2017)).
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rule, is considered mandatory and inconsistent with the idea 

of discretion.27 Thus, under the plain language of that statute, 

the department was required to adopt and promulgate rules 

and regulations to regulate the valuation process.28 Because the 

department had not adopted and promulgated rules and regulations governing the valuation process, we concluded that the 

adjusted valuations of the department were not in conformity 

with the law.29

In contrast, in Goodyear Tire & Rubber Co., we addressed 

whether the State Tax Commissioner was required to promulgate rules and regulations under Neb. Rev. Stat. § 77-4111 

(Reissue 2003) to define “qualified property,” a term utilized in 

the Employment and Investment Growth Act.30 Section 77-4111 

provides that the commissioner “shall adopt and promulgate all 

rules and regulations necessary to carry out the purposes of 

the Employment and Investment Growth Act.” In concluding the commissioner was not required to establish rules and 

regulations regarding its interpretation of “qualified property,” 

we noted the language in § 77-4111 required the adoption and 

promulgation of “only those rules that are necessary for carrying out the purposes” of the act.31

While § 46-707(1)(a) authorizes the adoption and promulgation of rules necessary to discharge the administrative duties 

assigned in GWMPA, § 46-746(1) establishes that the penalties for violations under GWMPA and rules and regulations of 

an NRD include reducing the violator’s ground water access 

in whole or in part. As such, we conclude that it is unnecessary for LLNRD to promulgate rules and regulations restating the potential for LLNRD to restrict a violator’s ground 

water access.

27 Loup City Pub. Sch., supra note 22.

28 Id.

29 Id.

30 Goodyear Tire & Rubber Co., supra note 23.

31 Id. at 601, 748 N.W.2d at 49.
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In consideration of the above, the district court did not err 

in determining LLNRD had the authority to suspend Prokop’s 

ground water access under § 46-746(1).

3. Procedural Due Pr

Prokop assigns LLNRD violated his due process rights by 

not providing him adequate notice of the charges against him 

and of the evidence to be presented.

[13,14] Due process principles protect individuals from arbitrary deprivation of life, liberty, or property without due process of law.32 Procedural due process claims require a two-step 

analysis: (1) whether the plaintiff has asserted a life, liberty, or 

property interest that is protected by the Due Process Clause 

and (2) whether the plaintiff was deprived of that interest 

without sufficient process.33 Here, Prokop’s interest in the use 

of ground water is a property interest that is under due process protections.34 Therefore, the issue is whether Prokop was 

deprived of that interest without sufficient process.

[15-17] A party appearing in an adjudication hearing before 

an agency or tribunal is entitled to due process protections 

similar to those given to litigants in a judicial proceeding.35

Due process does not guarantee an individual any particular 

form of state procedure. Instead, the requirements of due 

process are satisfied if a person has reasonable notice and an 

opportunity to be heard appropriate to the nature of the proceeding and the character of the rights which might be affected 

by it.36 In proceedings before an administrative agency or tribunal, procedural due process requires notice, identification of 

the accuser, factual basis for the accusation, reasonable time 

32 Cain v. Custer Cty. Bd. of Equal., 298 Neb. 834, 906 N.W.2d 285 (2018). 

See, also, U.S. Const. amends. V and XIV; Neb. Const. art. I, § 3.

33 White v. Busboom, 297 Neb. 717, 901 N.W.2d 294 (2017).

34 See Sorensen v. Lower Niobrara Nat. Resources Dist., 221 Neb. 180, 376 

N.W.2d 539 (1985) (superseded by statute on other grounds).

35 Cain, supra note 32.

36 Id.
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and opportunity to present evidence concerning the accusation, 

and a hearing before an impartial board.37

(a) Notice of Factual Basis for 

LLNRD’s Accusations

In its notice, LLNRD alleged that Prokop “failed to submit 

timely and complete annual reports . . . for the [2015 and] 2016 

crop year[s],” that “LLNRD sent multiple notice to [Prokop] 

requesting he submit the annual reports,” and that “LLNRD 

has reason to believe [Prokop] has intentionally and repeatedly 

violated the annual reporting requirements.” The notice stated 

LLNRD’s belief that Prokop “should be subject to penalties 

pursuant to the GWMPA and a cease and desist order should 

be issued” for the violation. The notice additionally provided 

that Prokop “has until June 1, 2017 to submit the complete 

annual reports” and informed Prokop of “LLNRD’s intention 

to enforce the penalty provisions of the GWMPA in the event 

[Prokop] fails to submit timely and complete annual reporting 

in accordance with this Notice.” In particular, the notice stated 

LLNRD’s intention to “de-certify [Prokop’s] irrigated acres” 

and “seek maximum civil penalties.” The notice also informed 

Prokop that “a hearing is scheduled regarding this Notice at 

5:00 p.m. on May 25, 2017,” “[t]he hearing shall be conducted 

on the record,” Prokop “will be given the opportunity to present any evidence or testimony he may have with respect to 

the violations identified in this Notice,” Prokop may appear 

through counsel, and the board will determine whether a cease 

and desist order should be issued based on the record developed at the hearing.

Prokop acknowledges the notice accused Prokop of 

“‘fail[ing] to submit timely and complete annual reports,’” 

but claims that the notice provided no factual basis as to 

what it alleged was deficient in the reports.38 Instead, Prokop 

37 Stenger v. Department of Motor Vehicles, 274 Neb. 819, 743 N.W.2d 758 

(2008).

38 Brief for appellant at 26.
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claims he was unaware of LLNRD’s allegations of missing 

signatures, dates, irrigation data, and nitrogen application until 

the hearing. Prokop argues that without such explanation of 

deficiencies, he was deprived of the opportunity to gather evidence and present witnesses on the precise allegations and was 

prevented from taking action to correct any deficiency before 

the hearing.

[18] However, contrary to Prokop’s claim, the notice was 

sufficient to inform Prokop of LLNRD’s claims and supporting factual allegations. Due process requires notice reasonably 

calculated to inform the party to the action of the subject and 

issues involved in the proceeding.39 LLNRD’s notice alleged 

Prokop “failed to submit timely and complete annual reports” 

for 2015 and 2016 and that Prokop “intentionally and repeatedly violated the annual reporting requirements.” These allegations informed Prokop that the reports for 2015 and 2016 were 

deficient and incomplete. The deficiencies of missing annual 

yield data, nitrogen application, water applied, and Prokop’s 

signatures were apparent on the face of the reports listed in 

the notice.

Prokop relies upon our decision in Blanchard v. City of 

Ralston40 to support his contention that the notice of LLNRD’s 

claims and supporting factual allegations were insufficient. In 

Blanchard, a city determined that a vacant house was a public 

nuisance and that its nonremedy was an immediate emergency. 

The city posted a notice on the house alleging only that the 

building was an unsafe nuisance because of an “odor and 

health-related hazards” and that the owner had 3 days to repair 

or demolish it before the city would subsequently demolish the 

house itself.41 The owner received no other notice and was only 

made aware of the posted notice after the 3-day period lapsed 

39 Robinson v. Morrill Cty. Sch. Dist. #63, 299 Neb. 740, 910 N.W.2d 752 

(2018).

40 Blanchard v. City of Ralston, 251 Neb. 706, 559 N.W.2d 735 (1997).

41 Id. at 709, 559 N.W.2d at 737.
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but before the demolition occurred. A hearing was scheduled 

for 1 hour prior to the demolition, with no further information given to the owner on the specific problems posed by the 

house. We determined that this violated the owner’s due process rights, because the notice failed, under the circumstances, 

to give her a statutorily required reasonable amount of time 

and failed to meaningfully inform her of the complicated and 

substantial specific problems alleged to constitute the hazards 

so that she could have an opportunity to remedy the situation 

and defend her case.42

Unlike Blanchard, LLNRD’s notice alleged a specific violation—that Prokop had “intentionally and repeatedly violated 

the annual reporting requirements”—and provided specific factual allegations that the 2015 and 2016 reports were incomplete 

and late. The individual violations of Prokop’s missing data 

were simple and readily apparent from the listed forms without 

the need of an expert, in contrast to the issues alleged to constitute a hazard in Blanchard.

43

LLNRD’s notice was reasonably calculated to inform Prokop 

about the allegations against him and the issues involved 

in the proceeding. Accordingly, the notice satisfied Prokop’s 

due process rights by informing him of the factual basis for 

the accusation.

(b) Notice of LLNRD’s Evidence

Prokop also claims that his due process rights were violated 

by not receiving notice of the evidence LLNRD intended to 

present and that such violation limits the possibility of competent judicial review. Prokop argues the notice appropriate to 

the nature of the present case includes “notice of the evidence, 

witnesses, and factual basis for the allegations against him,”44

in part due to his significant property interest to the access of 

ground water.

42 Blanchard, supra note 40.

43 See id.

44 Brief for appellant at 29.
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GWMPA does not set forth a specific formal due process 

hearing procedure containing the requirement that an NRD 

provide the names of any witnesses who will be called to testify against the alleged violator, an opportunity to examine any 

documents that will be presented at the hearing, the right to be 

represented, and an opportunity to cross-examine all witnesses 

and to present evidence material to the issues.45 Neither do the 

rules of LLNRD set forth rules of procedure regarding prehearing discovery. As a result, we must consider Prokop’s argument 

under the bare minimum due process requirements.

Prokop alleges not only that LLNRD failed to provide him 

notice of the evidence but also that he repeatedly requested the 

evidence prior to the hearing and was denied. However, in the 

record before us, there is no available evidence or stated allegations that would indicate Prokop requested and was denied 

access to LLNRD’s evidence prior to the hearing, including 

the 2015 and 2016 reports. Thus, we consider whether LLNRD 

was required to provide Prokop with notice of the evidence it 

intended to present and not whether LLNRD violated its due 

process obligations by refusing Prokop’s alleged request for 

access to the evidence.

[19,20] There is no due process requirement that an NRD 

provide notice of evidence to an adverse party prior to a hearing. In Cain v. Custer Cty. Bd. of Equal.,

46 we stated that, 

while similar to a judicial proceeding, an adjudication hearing before an agency does not guarantee an individual any 

particular form of state procedure. In States v. Anderson,

47 we 

declined to recognize prehearing discovery as a requirement of 

due process but acknowledged that administrative bodies have 

the authority to provide discovery which must be exercised 

judicially and not arbitrarily. And in Marshall v. Wimes,

48 in 

45 Compare § 46-743, with Neb. Rev. Stat. § 79-832 (Reissue 2014).

46 See, e.g., Cain, supra note 32.

47 States v. Anderson, 219 Neb. 545, 364 N.W.2d 38 (1985).

48 Marshall v. Wimes, 261 Neb. 846, 626 N.W.2d 229 (2001).
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addressing the refusal of an administrative body to issue a 

subpoena for appearance at a hearing, we explained that due 

process requires notice, identification of the accuser, factual 

basis for the accusation, reasonable time and opportunity to 

present evidence concerning the accusation, and a hearing 

before an impartial board.

[21,22] We have held that due process involving deprivation 

of a significant property interest requires notice and an opportunity to be heard that is appropriate to the nature of the case.49

Stated another way, due process depends on, in part, whether 

the notice was sufficient to provide the party a reasonable 

opportunity to confront and cross-examine adverse witnesses 

and present evidence.50

Here, LLNRD’s notice was sufficient to provide Prokop a 

reasonable opportunity to confront and cross-examine adverse 

witnesses and present evidence. The notice was given 23 days 

before the hearing, informed him of the time and location of 

the hearing, provided potential penalties, informed him that 

he would have the opportunity to address the charges and present evidence in his defense, and, as determined above, was 

sufficient to notify him of the charges and factual allegations 

supporting those charges, including that the 2015 and 2016 

reports were deficient and that these deficiencies were part of 

an intentional and continuing pattern.

The evidence LLNRD provided at the hearing included 

the notice, proof of service and publication of the notice, 

the reports specified in the notice, LLNRD rules establishing 

LLNRD’s authority to require and enforce the information on 

the reports, the complaint and order in Nance County District 

Court case No. CI 13-01, and testimony concerning the deficiencies of the reports and why the deficient material was 

important. All of this evidence was either a source of authority that was referenced in the notice, documents involving 

49 See, Cain, supra note 32; Blanchard, supra note 40.

50 Id.
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the notice and its receipt, or factual confirmation of specific 

allegations set forth in the notice. As such, the evidence presented was a natural extension of the notice and Prokop was 

sufficiently informed to provide him a reasonable opportunity 

to cross-examine LLNRD’s witnesses and present evidence at 

the hearing.

(c) Notice of Use of Prior Violation

Prokop specifically claims his due process rights were violated by not receiving notice of LLNRD’s intended use of case 

No. CI 13-01. By not receiving notice of LLNRD’s intent, 

Prokop argues, he was denied the opportunity to gather evidence, present witnesses, and prepare a defense concerning the 

use of the prior proceedings. Further, Prokop claims case No. 

CI 13-01 had nothing to do with the present allegations and 

should not have been admitted and considered by the board.

[23] First, as discussed above, due process does not require 

that LLNRD provide notice of its specific evidence to Prokop 

prior to the hearing.51

LLNRD’s notice did inform Prokop of its allegation that 

Prokop has “intentionally and repeatedly violated the annual 

reporting requirements.” Case No. CI 13-01 was relevant to 

LLNRD’s allegation because it was evidence of continued, 

similar violations. Prokop emphasizes in his brief that case 

No. CI 13-01 concerned illegal wells and alleges he would 

have presented further evidence on the facts surrounding those 

wells, but LLNRD used case No. CI 13-01 as evidence that 

Prokop had a history of violating LLNRD’s reporting requirements. While case No. CI 13-01 does address the illegal wells, 

it also, more relevantly, finds Prokop in violation of reporting 

obligations and orders him to provide the required reports. 

As such, LLNRD’s notice informing Prokop of its allegation 

that he has “intentionally and repeatedly violated the annual 

reporting requirements” appropriately informed him that his 

51 See, e.g., Cain, supra note 32; Marshall, supra note 48; Anderson, supra

note 47.
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prior violations, including those violations under case No. 

CI 13-01, would be at issue and that they would be relevant to 

the Board’s consideration of a potential penalty.

4. Possibility of Compet

Judicial Revi

Prokop assigns the district court erred in finding LLNRD’s 

action did not limit the possibility of competent judicial review. 

Specifically, Prokop claims he was not provided adequate 

notice of the claims against him and LLNRD’s intended evidence, which deprived him of the opportunity to gather evidence and arrange for witnesses to testify on his behalf.

Because we determined above that Prokop was provided 

adequate notice of the claims against him, was not entitled to 

notice of the specific evidence LLNRD intended to present, 

and was given opportunity to present his own evidence and call 

his own witnesses, Prokop’s assignment that he was deprived 

of the possibility of competent judicial review due to lack of 

notice is without merit.

5. Taking Without Just Compen

Prokop contends LLNRD’s issuance of a cease and desist 

order suspending his access to ground water, as modified by the 

district court, amounts to a taking without just compensation.

[24-26] A takings analysis begins with an examination of 

the nature of the owner’s property interest.52 Ground water, as 

defined by § 46-706, is owned by the public, and the only right 

held by an overlying landowner is in the use of the ground 

water.53 As noted above, the right of an owner of overlying 

land to use ground water is an appurtenance constituting property protected by Neb. Const. art. I, § 21.54

[27-29] Through its police power, the State has the power to 

determine public policy with regard to ground water and can 

52 Hill v. State, 296 Neb. 10, 894 N.W.2d 208 (2017).

53 See In re Application U-2, 226 Neb. 594, 413 N.W.2d 290 (1987).

54 Sorensen, supra note 34.
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alter the common law governing the use of ground water.55 The 

appropriate exercise of police power occurs where an owner 

is denied the unrestricted use or enjoyment of his property, or 

his property is taken from him, because his use or enjoyment 

of such property is injurious to the public welfare.56 This is in 

contrast to eminent domain, where property is taken from the 

owner and applied to public use because the use or enjoyment 

of such property is beneficial to the public.57 Appropriate use 

of police power includes that the State place limitations on the 

withdrawals of ground water in times of shortage.58

Here, LLNRD’s reporting requirements were implemented, 

in part, to address the goals under GWMPA of water quality 

and pollution control and address levels of nitrate nitrogen 

and other contaminants in ground water. In order to do so, 

LLNRD rules and regulations and GWMPA require various 

data from operators, including actual crop yield, nitrogen 

application, and water applied. This information is necessary 

to create long-term solutions to prevent levels of ground water 

contaminants from becoming too high and creating health 

hazards.59 By not complying with the reporting requirements, 

Prokop was preventing LLNRD from information necessary 

to perform its duties under GWMPA. Thus, LLNRD limited 

Prokop’s use, because his use or enjoyment of such property 

was injurious to the public welfare and, in doing so, this was 

an appropriate exercise of police power and did not amount to 

a taking without just compensation.

6. Exhibits 4 and

Prokop assigns the district court erred in declining to receive 

exhibits 4 and 5 to supplement LLNRD’s record. Prokop 

55 See Bamford v. Upper Republican Nat. Resources Dist., 245 Neb. 299, 512 

N.W.2d 642 (1994).

56 Strom v. City of Oakland, 255 Neb. 210, 583 N.W.2d 311 (1998).

57 Id.

58 See Bamford, supra note 55.

59 See § 46-709.
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claims these exhibits were admissible under “an exception to 

the general prohibition of extra-record evidence” for evidence 

of alleged procedural irregularities.60

However, exhibits 4 and 5 do not provide evidence relevant 

to whether there were procedural irregularities denying Prokop 

due process. Instead, Prokop purports that these exhibits demonstrate what evidence he could have presented if those procedural irregularities were not present. Evidence of what could 

have been presented if not for the alleged procedural violations 

is not evidence that would indicate whether or not such procedural violations occurred. Therefore, the district court did not 

err in declining to supplement LLNRD’s record and receive 

exhibits 4 and 5.

In the alternative, Prokop claims the district court abused 

its discretion in failing to remand the matter to the board for 

further proceedings to allow Prokop the opportunity to present 

the evidence from exhibits 4 and 5 in the interest of justice. 

Prokop’s argument centers on the allegation that he was denied 

due process and not provided sufficient notice of the claims 

against him. Having determined that the notice was sufficient 

to inform Prokop of the claims against him and that he was not 

entitled to a notice of the evidence which LLNRD intended to 

present, Prokop’s claim that the district court erred in failing 

to remand the matter to allow him to supplement the record is 

without merit.

7. Attorney Fe

Finally, Prokop assigns the district court erred in failing to 

reverse the board’s order and failing to award attorney fees, 

because LLNRD’s position was not substantially justified. 

Under Neb. Rev. Stat. § 25-1803 (Reissue 2016), a court having jurisdiction over a civil action brought by the State or an 

action for judicial review brought against the State pursuant 

to the APA shall award fees and other expenses to the prevailing party unless the prevailing party is the State. Because 

60 Brief for appellant at 33.
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we determined the district court did not err in affirming the 

board’s order, Prokop was not the prevailing party and the 

district court did not err in declining to award Prokop attorney fees.

8. Modification of Dur

Penalty LLNRD 

On cross-appeal, LLNRD and the board assign the district 

court erred in modifying the penalty from a 4-year suspension 

of Prokop’s ground water rights to a 1-year suspension with the 

possibility of 3 additional years if Prokop continues to violate 

LLNRD’s reporting requirements. In support of this assignment, LLRND asserts the district court should have given deference to the board’s penalty. However, this assertion is at odds 

with the district court’s standard of review.

[30] Any person aggrieved by an order of an NRD issued 

pursuant to GWMPA may appeal the order, and that appeal 

shall be in accordance with the APA.61 That appeal is conducted by the district court without a jury de novo on the 

record of the agency.62 In a de novo review on the record of 

an administrative order, the district court is required to make 

independent factual determinations based upon the record, and 

the court reaches its own independent conclusions with respect 

to the matters at issue.63

Here, the district court performed such a de novo review and 

determined that the 4-year suspension was unreasonable under 

the circumstances of the case and modified the penalty to a 

1-year suspension with a possibility of 3 more years if continued noncompliance.

LLNRD and the board acknowledge the statutory standard 

of review is de novo when a court is reviewing questions of 

fact or law. However, LLNRD and the board argue that the 

determination of a penalty is not a factual or legal issue but is, 

61 See § 46-750.

62 Neb. Rev. Stat. § 84-917(5)(a) (Reissue 2014).

63 See Medicine Creek, supra note 9.
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instead, a policy matter. LLNRD and the board argue GWMPA 

provides NRD’s deference to determine such penalties through 

operation of § 46-746(1), which provides a violator “shall be 

subject to the imposition of penalties imposed through the controls adopted by the district, including, but not limited to, having any allocation of water granted or irrigated acres certified 

by the district reduced in whole or in part.”

We disagree with LLNRD and the board’s interpretation. 

First, the language of § 46-746(1) does not limit the possibility of judicial review of the determination of penalties. 

Moreover, GWMPA does not limit what parts of an order are 

to be reviewed under the APA, stating “[a]ny person aggrieved 

by any order . . . may appeal,”64 and the APA states “the review 

shall be conducted . . . de novo,” without limiting the review 

of the order.65 As stated above, a district court in reviewing an 

administrative order is required to make independent factual 

determinations and reach independent conclusions with respect 

to the matters at issue.66 Clearly, the imposition of Prokop’s 

penalty was a matter at issue in the board’s proceedings, as 

evidenced by the amount of thought and consideration LLNRD 

alleges the board undertook in determining the severity of the 

issued penalty.

Because the district court utilized the appropriate de novo 

review in considering LLNRD’s imposition of the penalty and 

because the modified penalty conforms to the law, is supported 

by competent evidence, and is neither arbitrary, capricious, nor 

unreasonable, the district court did not err in modifying the 

duration of Prokop’s penalty.

V. CONCLUSION

For the reasons stated above, the district court did not err in 

determining that LLNRD had authority to require actual crop 

yield data from Prokop, that LLNRD had authority to impose 

64 § 46-750.

65 § 84-917(5)(a).

66 See Medicine Creek, supra note 9.
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a suspension of ground water access for noncompliance with 

reporting requirements, that Prokop’s right to due process was 

not violated in the proceedings before LLNRD’s board, that 

Prokop was not denied the possibility of competent judicial 

review, that the suspension of Prokop’s ground water access 

was not a taking without just compensation, that exhibits 4 and 

5 should not have been admitted as “extra-record evidence,” 

and that Prokop was not entitled to attorney fees. The district 

court also did not err in its modification of the duration of 

Prokop’s penalty.

Affirm

Miller-Lerman and Freudenberg, JJ., not participa

Papik, J., concurring

This court concludes that LLNRD had the authority to 

require the submission of actual crop yield data in at least 

partial reliance on the principle that courts are to afford deference to an agency’s interpretation of its own regulations 

unless plainly erroneous or inconsistent. We have cited and 

applied this principle on many occasions over the last several 

decades. See, e.g., Melanie M. v. Winterer, 290 Neb. 764, 

862 N.W.2d 76 (2015); Kosmicki v. State, 264 Neb. 887, 652 

N.W.2d 883 (2002); Wagoner v. Central Platte Nat. Resources 

Dist., 247 Neb. 233, 526 N.W.2d 422 (1995); Department 

of Banking, Receiver v. Wilken, 217 Neb. 796, 352 N.W.2d 

145 (1984).

But while we have precedent for the principle that courts 

defer to an agency’s interpretation of its own regulations, I am 

not sure that precedent rests on stable ground. The principle 

appears to have entered our jurisprudence in Wilken, supra. In 

that case, we cited a case from the Eighth Circuit holding that 

an agency is entitled to deference when interpreting its own 

regulations. Id., citing Columbus Community Hospital, Inc. v. 

Califano, 614 F.2d 181 (8th Cir. 1980). That Eighth Circuit 

case, in turn, cited Bowles v. Seminole Rock Co., 325 U.S. 410, 

414, 65 S. Ct. 1215, 89 L. Ed. 1700 (1945), a U.S. Supreme 

Court case which stated that the administrative interpretation 
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of a regulation has “controlling weight unless it is plainly 

erroneous or inconsistent with the regulation.” The Court in 

Seminole Rock Co. did not offer an explanation as to why the 

agency would be entitled to deference in those circumstances. 

See Decker v. Northwest Environmental Defense Center, 568 

U.S. 597, 617, 133 S. Ct. 1326, 185 L. Ed. 2d 447 (2013) 

(Scalia, J., concurring in part and in part dissenting) (observing 

that Seminole Rock Co. “offered no justification whatever”). 

Even so, the U.S. Supreme Court reaffirmed this principle 

decades later in Auer v. Robbins, 519 U.S. 452, 117 S. Ct. 905, 

137 L. Ed. 2d 79 (1997).

In recent years, however, the principle recognized in 

Seminole Rock Co., supra, and reaffirmed in Auer, supra, has 

been called into question. It has been criticized for lacking a 

coherent rationale, see Perez v. Mortgage Bankers Ass’n, ___ 

U.S. ___, 135 S. Ct. 1199, 191 L. Ed. 2d 186 (Thomas, J., 

concurring in judgment); for incentivizing the promulgation 

of vague regulations, see Decker, supra (Scalia, J., concurring 

in part and in part dissenting), and for violating the separation of powers, Perez, supra (Thomas, J., concurring in judgment). See, also, John F. Manning, Constitutional Structure 

and Judicial Deference to Agency Interpretations of Agency 

Rules, 96 Colum. L. Rev. 612 (1996).

The criticism leveled at Seminole Rock Co., supra, and Auer, 

supra, by multiple justices of the U.S. Supreme Court (including the author of Auer) had led some to speculate that “Auer

may not be long for this world.” Bible v. United Student Aid 

Funds, Inc., 807 F.3d 839, 841 (7th Cir. 2015) (Easterbrook, 

Circuit Judge, concurring in denial of rehearing en banc). See, 

also, Turtle Island Restoration Network v. US DOC, 878 F.3d 

725, 742 n.1 (9th Cir. 2017) (Callahan, Circuit Judge, dissenting in part) (“Auer’s continued vitality is a matter of considerable debate”). Such speculation may prove to be prescient, as 

the U.S. Supreme Court very recently granted certiorari on 

the question of whether Auer and Seminole Rock Co. should 

be overturned. See Kisor v. Shulkin, 869 F.3d 1360 (Fed. Cir. 
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2017), cert. granted in part sub nom. Kisor v. Wilkie, No. 

18-15, 2018 WL 6439837 (U.S. Dec. 10, 2018).

We thus appear to have adopted the principle that courts are 

to defer to agencies’ interpretations of their own regulations 

by decades ago uncritically adopting a dubious proposition of 

federal law that itself may not stand the test of time. While 

that seems reason enough for reconsideration of the principle 

in the appropriate case, I believe there is an additional reason 

to do so: The principle also seems to be in tension, if not at 

outright odds, with Nebraska’s version of the Administrative 

Procedure Act (APA).

In this case, and many others like it, Nebraska courts are 

called on to review the decisions of administrative agencies 

under the authority granted by the APA. The APA, however, 

provides that the review is to be conducted by the court “without a jury de novo on the record of the agency.” Neb. Rev. 

Stat. § 84-917(5)(a) (Reissue 2014). This standard has been 

interpreted to require district courts to make independent determinations of both factual and legal issues. See Medicine Creek 

v. Middle Republican NRD, 296 Neb. 1, 892 N.W.2d 74 (2017). 

But if the APA directs district courts to independently decide 

factual and legal questions without deferring to the agency, on 

what basis can courts defer to the agency’s interpretation of its 

own regulations? In my view, the lack of an obvious answer to 

that question is yet another reason why we should reconsider 

whether deference is owed to agencies’ interpretations of their 

own regulations.

With all that said, the parties have not asked us to reconsider 

our precedent in this case. Without the aid of argument from 

the parties, I do not believe such reconsideration is appropriate 

here. Therefore, I concur in this court’s decision in all respects. 

For the reasons expressed above, however, I would be open to 

reconsidering in a future case whether courts owe deference to 

agencies’ interpretations of their own regulations.