IN THE COMMONWEALTH COURT OF PENNSYLVANIA

Pocono Manor Investors, LP, :

Petitioner :

:

v. : No. 133 M.D. 2018

: ARGUED: March 13, 2019

Department of Environmental :

Protection of the Commonwealth of :

Pennsylvania and Environmental :

Quality Board of the Commonwealth :

of Pennsylvania, :

Respondents :

BEFORE: HONORABLE MARY HANNAH LEAVITT, President Judge

HONORABLE RENÉE COHN JUBELIRER, Judge

HONORABLE PATRICIA A. McCULLOUGH, Judge

HONORABLE ANNE E. COVEY, Judge

HONORABLE MICHAEL H. WOJCIK, Judge

HONORABLE CHRISTINE FIZZANO CANNON, Judge

HONORABLE ELLEN CEISLER, Judge

OPINION NOT REPORTED

MEMORANDUM OPINION

BY JUDGE CEISLER FILED: May 6, 2019

Respondents Department of Environmental Protection of the Commonwealth 

of Pennsylvania and Environmental Quality Board of the Commonwealth of 

Pennsylvania (DEP and EQB, individually, and Respondents, collectively) have 

filed Preliminary Objections to Petitioner Pocono Manor Investors, LP’s (Petitioner)

Amended Petition for Review (Amended Petition), through which Petitioner seeks 

declaratory and injunctive relief regarding the DEP and EQB’s redesignation of 

Swiftwater Creek, which runs through Petitioner’s property, as “Exceptional Value”
2

for purposes of water quality standards.

1 After careful review, we hold that Petitioner 

has neither exhausted its administrative remedies, nor pled facts in its Amended 

Petition that would enable it to circumvent this exhaustion requirement. Therefore, 

we sustain Respondents’ preliminary objection as to Petitioner’s failure to exhaust 

administrative remedies and dismiss the Amended Petition for lack of original

jurisdiction.

Petitioner 

owns Pocono Manor Resort & Spa located at 1 Manor 

Drive, Pocono Manor, Pennsylvania 18349. The Pocono 

Manor Resort & Spa encompasses approximately 3,000 

acres and is situated almost entirely within the upper 

portion of the Swiftwater Creek watershed. Pocono Manor 

Resort & Spa currently includes a hotel, conference 

facilities, an 18-hole golf course, and residences along 

with a number of other recreational amenities.

Amended Petition, ¶4.

2 According to Petitioner, the Brodhead Watershed 

Association filed a petition with the EQB on July 2, 2007, requesting that the 

Swiftwater Creek watershed be designated as Exceptional Value3from its source to 

the point at which it crosses State Route 611. Id., ¶28. For unspecified reasons, the 

DEP did not issue a draft report based off of this request until 2015, and did not issue 

 

1

“Water quality standards consist of the combination of water uses to be protected and the 

stream conditions that need to be maintained or attained to prevent or eliminate pollution in order 

to protect the designated uses. 25 Pa. Code § 93.1.” Concerned Citizens of Chestnuthill Twp. v. 

Dep’t of Envtl. Res., 632 A.2d 1, 2 n.1 (Pa. Cmwlth. 1993).

2 As this matter comes before us on preliminary objections, “[Petitioner’s] well-pled factual 

averments [in its Amended Petition] are [deemed] admitted; [however, Petitioner’s] conclusions 

of law are not.” Arbor Res. LLC v. Nockamixon Twp., 973 A.2d 1036, 1042 n.5 (Pa. Cmwlth. 

2009).

3 Swiftwater Creek had, at that time, a designation of “High Quality,” which is a 

designation that places fewer and less-onerous restrictions on usage of the Creek than would 

designation as Exceptional Value. See Amended Petition, ¶¶13-27.
3

its final report until February 2016. In this final report, the DEP recommended that 

Swiftwater Creek be designated as Exceptional Value “from its source to a location 

at the confluence of an unnamed tributary identified as UNT 04960[.]” Id., ¶¶38-39. 

Respondents then undertook rulemaking efforts in 2017, based upon the final report, 

and issued a final rule on February 10, 2018. See id., ¶¶41-48, 60. After review, the 

Environmental Protection Agency (EPA) then approved Swiftwater Creek’s new 

designation on April 16, 2018, pursuant to the requirements of Section 303 of the

federal Clean Water Act, 33 U.S.C. § 1313. Id., ¶¶66-70.

In response to Respondents’ final rule, Petitioner filed its Petition for Review 

with our Court on March 12, 2018, followed by the Amended Petition on May 29, 

2018. Through this Amended Petition, Petitioner seeks a declaratory judgment that: 

1. The redesignation of Swiftwater Creek as Exceptional Value “conflicts directly 

with and/or is contrary to the express provisions of other relevant statutes and 

regulations applicable to the industry”; 2. Respondents did not comply with the 

statutory and regulatory scheme for redesignating Swiftwater Creek as Exceptional 

Value; 3. The redesignation was not supported by “acceptable data”; 4. The “DEP’s 

statutory and regulatory scheme of designating the water quality standards for 

waterways . . . violate[d] [Petitioner’s] constitutional due process and equal 

protection rights”; 5. “The EQB failed in its statutory duty to draft and adopt the 

regulations, deferring entirely to [the] DEP to take full responsibility for every word 

in every iteration promulgated”; and 6. The rulemaking process through which 

Respondents designated Swiftwater Creek as Exceptional Value “[did not] comply 

with the Regulatory Review Act,[

4

] as shown in part by an inadequate Regulatory 

Analysis Form[.]” Id., ¶93. In addition, Petitioner seeks a stay of Swiftwater Creek’s 

 

4 Act of June 25, 1982, P.L. 633, as amended, 71 P.S. §§ 745.1-745.12a.
4

redesignation as Exceptional Value, and injunctive relief to prevent Respondents 

from implementing or enforcing the redesignation, until this case has been resolved.

Id., ¶¶94-103.

Respondents filed Preliminary Objections to Petitioner’s Amended Petition. 

Therein, Respondents argue the Amended Petition should be dismissed because

Petitioner failed to exhaust the administrative and statutory remedies available to it 

under the Environmental Hearing Board Act,5 and the Clean Streams Law,6 which 

Respondents maintain are adequate to address Petitioner’s concerns regarding 

Swiftwater Creek’s redesignation. Br. in Support of Preliminary Objections at 13. 

Respondents cite Concerned Citizens and Rouse & Associates v. 

Environmental Quality Board, 642 A.2d 642 (Pa. Cmwlth. 1994), two seminal cases 

in which our Court has previously addressed pre-enforcement review of the

redesignation of bodies of water. Br. in Support of Preliminary Objections at 16-20.

Respondents note these two cases are somewhat at odds with each other regarding

whether reclassification of a water source, prior to any enforcement action, is 

something that can be adequately addressed at the administrative level. Id.

Respondents contend that this matter is factually similar to Concerned Citizens, in 

which our Court found that exhaustion of administrative remedies was indeed a 

prerequisite for judicial review in this type of situation. Id. at 20-21. Respondents

also maintain that the harms alleged by Petitioner are speculative, prospective, and 

merely relate to Petitioner’s own particular interests in this one, specific instance,

rather than to those of an entire industry or the regulatory scheme as a whole, such 

 

5 Act of July 13, 1988, P.L. 530, 35 P.S. §§ 7511-7516.

6 Act of June 22, 1937, P.L. 1987, as amended, 35 P.S. §§ 691.1-691.1001.
5

that Petitioner’s claims fail to justify pre-enforcement review and deprive our Court

of original jurisdiction to consider the merits of the Amended Petition. Id. at 21-25.

By contrast, Petitioner contends that it has pled sufficient facts in its Amended 

Petition to establish it “will suffer actual, present harm” in the absence of preenforcement review, thereby establishing our Court’s original jurisdiction over this 

matter, per Rouse, despite Petitioner’s failure to exhaust its administrative remedies. 

Petitioner’s Br. in Opposition to Respondents’ Preliminary Objections at 1-19. In 

addition, Petitioner maintains that pre-enforcement review is proper because, like 

the petitioner in Rouse, it has also made constitutional challenges to Respondents’

designation scheme as a whole, rather than on an as-applied basis. Id. at 19-20. 

Finally, Petitioner maintains its Amended Petition “advances the interests of an 

entire industry[,]” which establishes another justification for pre-enforcement 

review. Id. at 21.

“In general, a court lacks jurisdiction to address an action in law or in equity 

where an administrative remedy exists. . . . However, the exhaustion of 

administrative remedies is not required where a statutory scheme’s constitutionality 

or validity is being challenged.” Giffin v. Chronister, 616 A.2d 1070, 1073 (Pa. 

Cmwlth. 1992). Furthermore, such exhaustion is not a necessary prerequisite for 

obtaining judicial review if “[the challenged administrative] regulation itself causes 

actual, present harm” prior to its enforcement. Concerned Citizens, 632 A.2d at 3.

We concur with the parties that both Concerned Citizens and Rouse guide our 

review of this matter. In Concerned Citizens, the EQB redesignated a body of water 

known as “McMichaels Creek,” upgrading its designation from High Quality to 

Exceptional Value. 632 A.2d at 2. Concerned Citizens of Chestnuthill Township, a 

local organization, then petitioned for review of this decision and requested that our 
6

Court vacate the redesignation, lodging “objections to the reclassification 

comprising challenges to the facts and the law supporting the [re]designation, claims 

that the upgrade will have deleterious economic, social[,] and political effects, and 

allegations of procedural and notification defects in the rulemaking process which 

resulted in the reclassification.” Id. The Department of Environmental Resources 

(DER)7 and the EQB filed preliminary objections in response, arguing in relevant 

part therein that our Court did not have original jurisdiction to consider the petition 

for review. Id.

We agreed, reasoning that the redesignation itself of McMichaels Creek did 

not stand to wreak actual, direct harm upon Concerned Citizens of Chestnuthill 

Township, as the redesignation was not “self-executing,” in that it did not directly 

impose affirmative duties upon the organization’s members, and the DER had not 

theretofore taken action to enforce the redesignation. Id. at 3.

The reclassification does not, for instance, make certain 

existing land uses impermissible, and the eventual impact 

of the new classification is, therefore, at this point of time, 

uncertain. . . . Furthermore, despite [the Concerned 

Citizens of Chestnuthill Township’s] claim that land 

development will now be more costly because of the 

allegedly invalid [Exceptional Value] classification, if and 

when the first landowner is aggrieved by a DER 

application of the new regulation, the landowner may not 

only appeal to the [Environmental Hearing Board] 

challenging the DER action, but also may challenge the 

validity of the regulation itself. . . . Thereafter, if it is 

decided that the regulation reclassifying [McMichaels] 

Creek is invalid, landowners will not be obliged to 

undertake the more costly land use evaluation required by 

a conditional use designation.

 

7 DER was the DEP’s previous name. Adams Sanitation Co. v. Pennsylvania Dep’t of Envtl. 

Prot., 683 A.2d 981, 982 n.1 (Pa. Cmwlth. 1996), aff’d on other grounds, 715 A.2d 390 (Pa. 1998).
7

Id. at 3-4. Consequently, we held that post-enforcement review was the proper 

remedy under the circumstances and, in addition, that the petition for review only 

contained issues that were not yet ripe for our consideration. Id. at 4.

In Rouse, Rouse submitted a 

preliminary subdivision and land development plan 

application to develop 161 acres for multi-family 

residential dwellings in East Whiteland Township (the 

Township). The East Whiteland Township Zoning Board 

(zoning board) approved Rouse’s application with the 

condition that Rouse construct a package treatment plant 

that discharges treated water into Valley Creek. At that 

time, there were already package treatment plants located 

on Valley Creek which discharged treated water into the 

waterway. Rouse had initially proposed to connect to the 

Township’s public sewer system but agreed to construct 

the treatment plant in conformity with the zoning board’s 

direction. Subsequently, three environmental groups 

unsuccessfully challenged the zoning board’s requirement 

that Rouse’s treatment plant discharge water into Valley 

Creek.

642 A.2d at 643. Thereafter, the DER began reviewing the status of Valley Creek, 

instigating a process which eventually led to the designation of Valley Creek as 

Exceptional Value. Id. at 643-44.

Rouse then filed a petition for review in our Court, challenging Valley Creek’s 

new designation, to which the DER and EQB filed preliminary objections based, in 

part, on the argument that we did not have original jurisdiction to consider the 

petition for review on account of Rouse’s failure to exhaust administrative remedies. 

Id. at 644. We overruled this objection for three reasons:

First, Rouse has alleged that it will suffer actual, present 

harm before the enforcement of DER’s designation of 

Valley Creek as [Exceptional Value]. In its petition for 

review, Rouse claims that it is immediately, directly, and 

actually impacted and that it will suffer a hardship for the 

following reasons:
8

a. Rouse would be required to spend endless 

amounts of time and money to prepare plans and 

applications and submit them for its proposed 

treatment plant. They would then be processed by 

DER when DER has already predetermined that a 

treatment plant with stream discharge into an 

[Exceptional Value] stream will cause an adverse 

measurable change in the existing water quality and, 

therefore, would not be issued a permit.

b. Rouse would be forced to await an administrative 

determination of its permit application before being 

able to obtain a judicial review of the validity of the 

regulation and the viability of the permit 

application.

c. In order to be able to apply for a sewage disposal 

plan permit, Rouse would have to spend tremendous 

sums of money for final land development plans for 

its proposed development because DER will not 

process Act 537[

8

] amendments or sewage disposal 

plant permits until final land development plans 

have been approved.

d. Rouse cannot proceed with its development or 

sell its development because of the uncertainty of 

the sewer proposal.

These allegations, when accepted as true, demonstrate the 

existence of actual, present harm.

Second, the instant matter can be distinguished from 

Concerned Citizens, because Rouse is placed in a unique 

position by the zoning board’s refusal to allow Rouse to 

connect to presently operating sewage disposal units and 

by the zoning board’s conditioning of its approval of 

Rouse's land use plans on Rouse’s agreement to construct 

a sewage treatment plant. In Concerned Citizens, the 

[Concerned Citizens of Chestnuthill Township’s] general 

claim that the redesignation of McMichaels Creek would 

have deleterious economic, social, and political effects is 

far more remote and anticipatory than Rouse’s claims in 

 

8

 “Act 537” is formally known as the Pennsylvania Sewage Facilities Act, Act of January 

24, 1966, P.L. (1965) 1535, as amended, 35 P.S. §§ 750.1-750.20a. Delaware Riverkeeper v. Dep’t 

of Envtl. Prot., 879 A.2d 351, 353 (Pa. Cmwlth. 2005).
9

the present matter. The [Concerned Citizens of 

Chestnuthill Township] did not have any pending 

subdivision or land development plan, the approval of 

which was tied to the existence of an [Exceptional Value]

stream. In the instant matter, the zoning board’s 

requirement that Rouse construct a treatment plant that 

discharges into Valley Creek in order [to] realize [its] land 

use proposal, forces Rouse to be more immediately 

concerned with the water quality requirements for Valley 

Creek.

[Finally], Rouse’s petition for review goes further than 

merely challenging DER’s redesignation of Valley Creek. 

Rouse’s petition for review raises constitutional due 

process and equal protection challenges to DER’s 

regulatory scheme of designating the water quality 

standards for waterways.

Id. at 646-47.

Here, even assuming the truth of the Amended Petition’s well-pled averments,

we find that Petitioner has failed to establish that we may properly invoke our powers 

of original jurisdiction over this matter. In Rouse, the DER initiated the designation 

process after Rouse was already in the midst of developing its property. Here, the 

only specific project that Petitioner claims will be affected by Swiftwater Creek’s 

redesignation is the “Pocono Springs Entertainment Village,” which was announced 

two months after Respondents issued their final rule enacting the designation and 

five days before the EPA approved Respondents’ decision. Amended Petition, ¶¶69-

70, 74-85. Thus, it is Petitioner’s decision to initiate development of its property 

while Swiftwater Creek’s redesignation was still under formal consideration, rather 

than the redesignation itself, which stands to cause potential harm to Petitioner. 

Petitioner’s choice to move forward with the Pocono Springs Entertainment Village

project under the circumstances is not dissimilar to a pedestrian leaving the safety of 

the sidewalk, deliberately jumping into the rush of oncoming traffic, and then 

faulting the affected drivers for their inability to avoid the resultant collision. In 
10

addition, Petitioner also avers that the value of its property “was immediately 

diminished upon publication of the redesignation of Swiftwater Creek in the 

Pennsylvania Bulletin on February 10, 2018.” Amended Petition, ¶86. This, 

however, is far too conclusory and speculative a statement to establish the existence 

of actual, direct harm to Petitioner as a result of Swiftwater Creek’s redesignation.

Furthermore, Petitioner has failed to properly plead a facial constitutional 

challenge to the regulatory scheme through which Respondents impose water quality 

standards. Indeed, in its Amended Petition, Petitioner merely alleges that Petitioner 

alone will be affected by Swiftwater Creek’s redesignation, rather than a broader 

attack upon the designation process as a whole. See, e.g., id., ¶¶28-40. In fact, during 

oral argument before this Court, the parties agreed that no other property owners 

along this watershed that were impacted by the redesignation sought to challenge the 

propriety of the redesignation. Petitioner’s exclusive focus on the putative effect of 

Swiftwater Creek’s redesignation upon Petitioner’s property alone vitiates any 

argument that Petitioner seeks to address industry-wide concerns and, consequently, 

may obtain immediate, pre-enforcement review on that basis. Arsenal Coal Co. v. 

Dep’t of Envtl. Res., 477 A.2d 1333, 1339-40 (Pa. 1984). Thus, to the extent that 

Petitioner raises constitutional issues, it does so on an as-applied basis, which 

requires it to exhaust its administrative remedies prior to seeking judicial review. 

Keystone ReLeaf LLC v. Pa. Dep’t of Health, 186 A.3d 505, 516 (Pa. Cmwlth. 

2018).

9

 

9

In its Amended Petition, Petitioner further claims that Respondents failed to provide 

Petitioner with proper notice and opportunities to be heard while redesignation of Swiftwater 

Creek was being considered. Amended Petition, ¶93(d). However, during oral argument before 

this Court, Petitioner conceded that it had been fully aware of Swiftwater Creek’s consideration 

by Respondents for redesignation and had, in fact, participated throughout the process.
11

Therefore, as Petitioner has neither exhausted the remedies available to it at 

the administrative level, nor pled facts enabling it to invoke an exception to this 

doctrine of exhaustion, we sustain Respondents’ preliminary objection regarding 

Petitioner’s failure to do so and dismiss the Amended Petition for lack of original

jurisdiction.10

ELLEN CEISLER, Judge

 

10 In light of this ruling, we decline to address the remainder of the arguments raised by 

Respondents in their Preliminary Objection.
IN THE COMMONWEALTH COURT OF PENNSYLVANIA

Pocono Manor Investors, LP, :

Petitioner :

:

v. : No. 133 M.D. 2018

:

Department of Environmental :

Protection of the Commonwealth of :

Pennsylvania and Environmental :

Quality Board of the Commonwealth :

of Pennsylvania, :

Respondents :

O R D E R

AND NOW, this 6

th day of May, 2019, upon consideration of the Department 

of Environmental Protection of the Commonwealth of Pennsylvania and 

Environmental Quality Board of the Commonwealth of Pennsylvania’s 

(Respondents) Preliminary Objections to Pocono Manor Investors, LP’s (Petitioner)

Amended Petition for Review (Amended Petition), and Petitioner’s response thereto, 

it is hereby ORDERED:

1. Respondents’ preliminary objection, regarding Petitioner’s failure to exhaust 

administrative remedies, is SUSTAINED;

2. Petitioner’s Amended Petition is DISMISSED, due to lack of original

jurisdiction.

ELLEN CEISLER, Judge