Opinion ID: 700470
Heading Depth: 1
Heading Rank: 3

Heading: The History of LWD's Licensing Process.

Text: 20 LWD purchased its facility in 1977 and has since that time been involved in the complicated process of obtaining all the necessary permits and approvals for it to operate. LWD submitted its Part A application on September 19, 1980 and a Part B application on May 10, 1983. However, during the course of the application approval process, problems arose with LWD's Part B application. The Cabinet issued at least six Notice of Deficiencies to LWD concerning its Part B application. Plaintiffs contend these notices resulted from LWD's willful failure to provide the Cabinet with sufficient information to allow for the processing of its Part B application. Regardless of the reason, it is clear that the relationship between the Cabinet and LWD deteriorated to the point where two separate legal actions were initiated in the Franklin County, Kentucky, Circuit Court. 21 In the first action, Franklin County Circuit Court No. 89-CI-1138, the Cabinet sued LWD to enjoin it from transferring part of the property on which the facility is located to other corporate entities in an alleged attempt to avoid clean-up costs associated with part of the site. In the other action, Franklin County Circuit Court No. 89-CI-1592, LWD filed suit to enjoin the Cabinet from enforcing its decision to deny LWD's final Part B permit and effectively close the facility. 22 During the course of these proceedings, the circuit court determined that LWD had submitted a technically complete Part B application and obtained interim status to operate the facility since 1980 as defined by 401 KAR 30:010, Section 1(145)(b); 401 KAR 38:020, Section 1(1); and 401 KAR 30:010, Section 1(101). The court also enjoined the Cabinet from closing the facility but did not restrict the Secretary or Cabinet from taking further action against LWD pursuant to KRS Sec. 224.071, concerning LWD's Part B permit application. In fact, the court specifically remanded all issues relating to LWD's permit issuance or denial to the Cabinet for determination in accordance with the procedures of that administrative body. 23 The court's final order was in apparent response to an agreement by the Cabinet and LWD. This agreement established the conditions under which LWD would operate the incinerators pending the Cabinet's final permit decision, including test or trial burns of incinerators, and imposed $100,000 in civil penalties against LWD for past violations. 24 Concurrent with the Franklin County Circuit Court proceedings, plaintiffs filed three administrative petitions with the Cabinet protesting the agreements reached between LWD and the Cabinet as to the facility's continued operation during the approval process. 1 CHC's petitions were filed pursuant to KRS Sec. 224.10-420 which provides that any aggrieved person may file a petition and is entitled to a hearing concerning the issuance of a permit. Judicial review of all orders of the Cabinet is available in the Franklin County Circuit Court pursuant to KRS Sec. 224.10-470 and any decision reached by that court may be appealed to the Kentucky Court of Appeals. KRS Sec. 224.10-470. 25 In at least two of the petitions, CHC specifically alleged that LWD was in violation of 42 U.S.C. Sec. 6925(c)(2)(A)(ii) because LWD continued to operate under interim status although it had not been granted or denied its final Part B permit by the November 8, 1989 deadline. An administrative hearing was conducted on the petitions. The initial hearing officer recommended that CHC be granted partial summary judgment on the permit deadline issue based on his determination that LWD was in violation of RCRA because the final permit had not been issued by November 8, 1989. Both the Cabinet and LWD filed exceptions to the hearing officer's recommendation with the Secretary, and CHC responded to those exceptions. The Secretary declined to adopt the findings and recommendation. 26 The Secretary's decision was based in part on his determination that the report and recommendation by the hearing officer was grossly deficient in setting forth any legal reasoning, that factual disputes remained concerning the delays surrounding LWD's Part B permit issuance, and that the Franklin County Circuit Court had determined that LWD was entitled to interim status. The Secretary also noted that CHC failed to cite any case supporting its position that LWD's interim status expired by operation of law under RCRA on November 15, 1989. 2 More importantly, the Secretary determined that the November 8, 1989 deadline dispute was an appropriate issue for determination in subsequent administrative proceedings. 27 The Secretary then remanded the case for further administrative hearings and for the purpose of establishing a factual record in an effort to resolve the issues raised in CHC's petitions. In the remand order, the Secretary set forth a strict time table for the completion of discovery between the parties, the completion of any additional test burns and for review of the results. The Secretary also established a November 1, 1993 completion date for determining whether LWD would be issued or denied its Part B permit. 3 At this point, however, CHC abandoned its proceedings before the Cabinet and filed this action in the district court. CHC also filed a notice of its federal action with the Cabinet and sought a stay of any further Kentucky administrative proceedings pending resolution of its federal action. 28