1 Because the renewal permits carry the same number as the original permits,

without any distinguishing factor such as the –1, – 2 series of suffix numbers used for permit amendments, this decision will use the year of issuance to distinguish them. The renewal permit that is the subject of this appeal w as issued on October 4, 2006.

2 VNRC has filed a motion to alter or amend the Cou rt’s May 11, 2007 decision conferring amicus status on VNRC, asserting additio nal grounds for intervenor party status; that motion will be addressed in a separate decision.

1 STATE OF VERMONT

ENVIRONMENTAL COURT

} In re: Unified Buddhist Church, Inc., } Indirect Discharge Permit } Docket No. 253-10-06 Vtec (Appeal of Lull’s Brook Watershed } Association, etal. ) }

Decision and Order on Motion in Limine Appellants Lull’s Brook Watershed Association, JohnZelig, Amy Zelig, Peter Gordon, Sterling R. Monk, Marion Monk, and Heidi Luqu er (Appellants) appealed from a decision of the Agency of Natural Resources to gr ant renewal Indirect Discharge Permit ID-9-0271 (2006 1 ) to Appellee-Applicant Unified Buddhist Church, Inc . (Unified Buddhist). Appellants are represented by David Grayck, Esq.; A ppellee-Applicant is represented by Hans Huessy, Esq.; the Vermont Agency of Natural Re sources (ANR) is represented by Catherine Gjessing, Esq.; and amicus curiae 2 Vermont Natural Resources Council (VNRC) is represented by Jon Groveman, Esq.

Procedural History The proposed disposal system and the procedural his tory of the prior permits is2

discussed extensively in a decision of the Supreme Court relating to an earlier permit amendment: In re Unified Buddhist Church, Inc. , 2006 VT 50, ¶3-9. In 2001, the ANR issued the original Indirect Disch arge Permit ID-9-0271 (the 2001 Permit) to Unified Buddhist, effective until June 3 0, 2006, approving a discharge from the Green Mountain Dharma Center of 15,000 gallons per d ay, from a sewage treatment system, with an indirect discharge into Lull’s Broo k, a tributary of the Connecticut River. No appeal was taken from the initial Indirect Disch arge Permit; the system authorized by that permit was not constructed. In 2003, the ANR issued amended Indirect Discharge Permit ID-9-0271-1, approving the indirect discharge of 9,500 gallons per day from a sewage treatment system. No appeal was taken from the first amended permit; the system authorized by that permit amendment was not constructed. In late 2004, the A NR issued second amended Indirect Discharge Permit ID-9-0271-2, also approving an ind irect discharge of 9,500 gallons per day. The Vermont Supreme Court affirmed the Water Resources Board’s dismissal of the appeal of this permit. In re Unified Buddhist Churc h, Inc. , 2006 VT 50, ¶1. The system authorized by that permit was not constructed. In late 2006, after the public notice and public he aring required by the statute and rules applicable to its Indirect Discharge program, the ANR issued a renewal permit, which we will refer to as Indirect Discharge Permit ID-9- 0271 (2006) or “the renewal permit,” effective until June 30, 2011. This is the permit o n appeal in the present case, Docket No. 253-10-06 Vtec. This permit approved the indirect discharge of 9,500 gallons per day from a new proposed sewage treatment system, including s eptic tankage, pump stations and
leach field. The leach field consists of a trench absorption design of sixteen three-trench
cells for 100% dual alternation. No construction h as begun on the sewage treatment system.3 Appellants had also moved to strike ANR’s memoran dum regarding res judicata

or, in the alternative, had requested leave to resp ond to it. Appellants argued that the ANR’s memorandum was untimely when it was filed on January 22, 2007, in response to the motion in limine filed by Unified Buddhist on D ecember 19, 2006. However, at the telephone conference held on January 12, 2007, the Court ordered that responses to all then-pending motions be filed by January 22, 2007. The ANR memorandum was timely based on that order; Appellants’ motion to strike t he ANR memorandum is therefore DENIED. Appellants did file a response to the ANR memorandum on January 26, 2007; their request for additional time to respond has be come moot.

3 Motion in Limine re Scope of Appeal Appellee-Applicant Unified Buddhist has moved in li mine to exclude, from the present appeal of the renewal permit, all issues th at were addressed during the issuance of its original Indirect Discharge Permit No. ID-9- 0271 (2001), or in the first or second amendments to that permit in 2003 and 2004. Unifie d Buddhist argues that Appellants should be precluded from litigating any issues thatwere, or could have been, litigated in any of the prior proceedings, based on the doctrine of res judicata. 3 Res judicata, or claim preclusion, is “founded uponthe judicial economy and fairness of litigating and disposing of all issues involved in a legal dispute where the parties, subject matter and causes of action are id entical or substantially identical.” Cupola Golf Course, Inc. v. Dooley , 2006 VT 25, ¶10, 179 Vt. 427, 430 (citing Lamb v. Geovjian, 165 Vt. 375, 379-80 (1996)). “The doctrine of claim pr eclusion advances the efficient and fair administration of justice because it serves ‘(1) to conserve the resources of courts and litigants by protecting them against piecemeal or r epetitive litigation; (2) to prevent vexatious litigation; (3) to promote the finality o f judgments and encourage reliance on judicial decisions; and (4) to decrease the chances of inconsistent adjudication.’” Faulkner v. Caledonia County Fair Ass’n, 2004 VT 123, ¶9, 178 Vt. 51, 54-55 (quoting In r e Cent. Vt. Pub. Serv. Corp. , 172 Vt. 14, 20 (2001)). The doctrine of res judicata is distinct from the c oncept of finality of an unappealed4 In this context, we note that the ANR process resu lting in the issuance of a

discharge permit is a notice-and-comment type of pr oceeding, in which public comments are taken at a hearing held after the issuance of a draft permit by the Agency, rather than a trial type of proceeding, such as before the Dist rict Commissions under Act 250, in which parties may, for example, cross-examine witnesses a nd present evidence. Accordingly, although participation in the proceedings below is now a prerequisite for bringing an appeal of a municipal or an Act 250 permit, 10 V.S. A. §8504 (b) and (d), there is no such requirement for appeals from ANR permit decisions.

4 permit. Compare Faulkner , 2004 VT 123, ¶9, 178 Vt. at 54-55 with In re Unif ied Buddhist Church, Inc. , 2006 VT 50, ¶13. The former concerns prior litig ation, or prior trial-type administrative adjudication, 4 in which the parties had a full and fair opportuni ty to litigate all claims. The latter is implicated when a party fails to appeal a final permit, in particular
if a statute or case law has established the finali ty of an unappealed permit in the particular permit program. See, e.g. , 24 V.S.A. §4472; Levy v. Town of St. Albans Zoning Bd. of Adjustment, 152 Vt. 139, 142 (1989) (as to municipal zoning pe rmits); In re Taft Corners Assocs., Inc. , 160 Vt. 583, 593 (1993) (as to Act 250). The issue in the present case is the extent to whic h the doctrine also should be applied in the context of an application for a so-c alled “renewal permit” in the Vermont state indirect discharge permit regulatory system. In a de novo appeal of any ANR decision, such as the issuance of the renewal indir ect discharge permit at issue in the present case, this Court is required by statute to apply “the substantive standards that were applicable before the tribunal appealed from.” 10 V.S.A. § 8504(h). The Agency’s own practices may assist the Court in interpreting and applying the substantive standards, but the Court’s basic obligation is to apply anew the s ubstantive legal standards to the facts the Court finds from the evidence presented in the de novo proceedings. Indirect discharge permits are governed generally b y 10 V.S.A. §1259(e), which provides that “[e]xcept for on-site disposal of sew age from systems of less than 6,500 gpd5 Indirect discharges of the type on appeal, from a source other than a publicly

owned treatment works, are not regulated by the fed eral Clean Water Act. 33 U.S.C. § 1311(b)(1).

5 capacity that are either exempt from or comply withthe environmental protection rules, no person shall cause any new or increased indirectdischarge of wastes into Class B waters without a permit under section 1263.” Section 1259 (e) further provides that: The secretary shall not issue a permit for on-site disposal of sewage that discharges into Class B waters, unless the applican t demonstrates by clear and convincing evidence, and the secretary finds, t hat the discharge: (1) will not significantly alter the aquatic biota in the re ceiving waters; (2) will not pose more than a negligible risk to public health; (3) will be consistent with existing and potential beneficial uses of the water s; and (4) will not cause a violation of water quality standards. The Vermont Indirect Discharge Rules (IDR), §14-601 (c), provide that, “[f]or a new indirect discharge of sewage, an applicant must show by clea r and convincing evidence that the discharge will meet the statutory requirements for obtaining an indirect discharge permit. The standards and requirements of these rules, whenmet, provide the evidence necessary to meet this statutory requirement.” Like discharge permits issued pursuant to the Natio nal Pollutant Discharge Elimination System created by the federal Clean Wat er Act, 33 U.S.C. § 1342, state-issued indirect discharge 5 permits are valid for a term “not to exceed five y ears,” 10 V.S.A. §1263(d)(4), may be renewed “from time to time uponapplication to the secretary,” and “shall be issued following all determinations and p rocedures required for initial permit application.” Id . §1263(e). If an indirect discharge permit has been issued, aut horizing construction of a sewage system and setting standards and conditions for the discharge from that system, and that permit is not appealed, the permit holder has the r ight to rely on the permit during its fiveyear term. If any amendments are sought to the per mit during its five-year term, the scope6 The question of how much construction or preparat ion may be sufficient to trigger

this practice is beyond the scope of the present mo tion, as no argument has been made that construction has commenced.

6 of the amendment decision, and the scope of the app eal of any amendment decision, is limited to the changes proposed by the amendment. Buddhist, 2006 VT 50, ¶10,¶20. At least after an applicant has constructed 6 the system authorized by a final original permit, it is the ANR’s practice to apply principles of issue preclusion or vested rights so as not to revisit design and construction issues ina renewal permit, but rather to assess the system’s operation and compliance with the permit’s conditions and performance standards. Regardless of whether this practice has been adopted as a formal procedure, 3 V.S.A. §§801(7), 801(8), 831(b), 835; or whether i t forms part of the “substantive standards” applicable before the Agency, this appro ach is a sensible one. However, the Court declines to apply it in a situation in which construction of the project authorized by the original permit has not commenced prior to the expiration of that permit. The fact that the ANR does not require an applicantto provide as much information to the agency in a renewal application as in the or iginal application does not change this result. Regardless of the filing requirements, an a pplicant has the burden of making the same showing of compliance with the statute and rul es in a renewal application as in an original application. As well as the statutory requirement, §14-602 of the Indirect Discharge Rules provides that previously-permitted indirect d ischarges “must comply with the current Water Quality Standards in effect at the ti me of permit renewal, including [with] any revisions [to the WQS] which have occurred sinc e the permit was issued.” In the present case, it is not possible to review the comp liance of the facility with its existing permit, in the context of determining whether to is sue a renewal permit, as it is not in operation. See IDR § 14-406(e). All that is avail able to review is its design and construction. See also IDR § 14-201(a) (noting tha t each permit is valid for five years,7Pursuant to 10 V.S.A. § 8504(m), decisions of the Water Resources Board are given

the same weight as those of this Court.

7 despite intervening regulatory changes, but that eac h renewal application is viewed in light of regulatory changes since last five-year permit w as issued). In the context of a renewal permit appeal, the stat ute requires the Court to consider “all determinations and procedures required for ini tial permit application” in deciding whether a renewal permit should be issued, if those issues are properly appealed, 10 V.S.A. §1263(e), regardless of whether the same issues wer e considered in issuing the original permit and intervening amendments. Thus, in an appe al of a renewal permit, as opposed to that of an amendment of an unappealed permit, th e Court may consider anew any issues authorized by §1263(e) or the Indirect Discharge Ru les, including issues that may have been addressed in the context of prior permitting decisi ons. See Re: City of South Burlington (Bartlett Bay Wastewater Treatment Facility) , No. WQ-01-04 Second Prehearing Conf. Report and Order, pp. 5-6 (Water Res. Bd. 7 , Apr. 18, 2002) Neither the statutory and regulatory mandates, nor the doctrine of res judicata, bars Appellants from introducing evidence or legal argum ents related to issues that were, or could have been, previously litigated in prior perm it proceedings. This result is the same whether it is reached under the statutory scheme or by applying the common law res judicata principles. Both the statute and the rule s contemplate a necessary review of previously-litigated issues. See §1263(e); IDR §14 -602. Even the logic of limiting indirect discharge permi ts to a term of “no more than five years” must allow the analysis of any issues relate d to the previously-issued permit, the facility’s compliance with it, any changes in the fa cility’s operation, and how those affect water quality. §1263(e); IDR § 14-406(e). Otherwi se the five-year term of indirect discharge permits would be mere surplusage. DeBartolo v. Und erwriters at Lloyd’s of London, 20078

VT 31, ¶16 (citing Vt. State Colls. Staff Fed’n v. Vt. State Colls. , 157 Vt. 645, 646 (1991) (statutory constructions that render provisions su rplusage should be avoided). Similarly, if parties were barred from revisiting issues raise d in prior permit proceedings, there would be no difference between a permit amendment proceed ing and a renewal permit proceeding, which would render the provisions speci fically governing renewal as surplusage. DeBartolo , 2007 VT 31, ¶16 (citing Vt. State Colls. Staff Fed’ n, 157 Vt. at 646. Because this comprehensive review is expressly cont emplated by the statutory and regulatory structure, an appeal of a renewal permitis far from the type of “vexatious” litigation which the doctrine of res judicata is de signed to prohibit. See Faulkner , 2004 VT 123, ¶9. As construction of the system approved in the expired 2001 Permit has not commenced, issues related to the design of the syst em, as well as operating issues, may be raised in the renewal permit proceedings.

Accordingly, based on the foregoing, it is hereby O RDERED and ADJUDGED that
Unified Buddhist’s Motion in Limine is DENIED.

Done at Berlin, Vermont, this 31 stday of July, 2007.

_________________________________________________ Merideth Wright Environmental Judge