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Battle Over Drainage Permit Heats Up

Posted on: September 16th, 2020
by David Ganje

Mount Vernon farmer files second lawsuit to stop drainage project, while first permit could go to South Dakota’s high court

Written By: Marcus Traxler | Sep 14th 2020 – 6pm.

The matters of a Davison County drainage permit have become more entangled in the court system, with the results of the first decision being appealed to the South Dakota Supreme Court and a second permit for the same landowner drawing a new lawsuit.

John Millan filed a second permit for a drainage permit in Beulah Township on Aug. 6, which was shortly after his first permit was voided by a First Circuit Court ruling. That permit has drawn a second lawsuit from neighbor Kenneth Hostler, who filed a new suit on Aug. 31 against Millan and Davison County asking for a permanent injunction and declaratory judgment to void the new permit.

In the first court matter over the drainage permit that was initially approved in March, Judge Patrick Smith sided Hostler, writing in his decision that Millan’s initial application was missing key information in order for the Davison County Drainage Commission to make a decision. Millan and the county have appealed the first decision to the South Dakota Supreme Court, according to court documents filed Sept. 4.

In the appeal, Millan’s attorney, Gary Lestico, of the Rinke Noonan law firm in St. Cloud, Minnesota, claims among other items, that the trial court improperly considered matters outside of applicable South Dakota state law for permissible drainage of water and had erred in deciding that Millan didn’t meet his burden of proof in the permit application and erred deciding that the Davison County Drainage Commission had abused its discretion in initially granting the permit in March.

When Millan applied for another permit in early August, he sought administrative approval through Davison County Planning and Zoning Administrator Jeff Bathke, who oversees the county’s drainage processes. Bathke approved the permit on Aug. 10.

Drainage permits in Davison County can be approved by the administrator without going to the county’s Drainage Commission if they meet specific criteria. That criteria includes drainage projects that involve the county’s major creeks and rivers, such as Firesteel Creek, Enemy Creek, the James River or Dry Run Creek. The criteria also allows for approval if signed waivers are received for upstream landowners within a half-mile, downstream landowners within 1 mile and landowners within a quarter-mile of the center of the drain area. Six signed waivers, including one from Millan, were included with the permit, and based on the county’s criteria and mapping, Hostler was not a landowner who had to sign a waiver to allow the permit to proceed.

In his most recently filed lawsuit, Hostler alleges the new project application was “illegally approved.” He says the project will drain water onto his property in southeast corner of Section 19 in Beulah Township, which is located immediately to the north of Section 30, where Millan’s drainage project is planned in the southern half of the section.

“The method and place for discharging surface waters onto Plaintiff’s land in the new project is the same method and place for discharging surface waters onto Plaintiff’s land under a drainage permit voided by the Circuit Court in related litigation,” wrote Hostler’s attorney, David Ganje, of Sun City, Arizona.

The land in question is about 5 miles east of Mount Vernon and about 8 miles west of Mitchell near Interstate 90. Millan’s permit calls for 157,277 feet of drainage tile on his land, draining 320 acres of property, with the water eventually draining into Dry Run Creek.

The Davison County Commissioners decided earlier this month to retain James Davies, of Alexandria, as the county’s attorney in the matter due to conflicts involving Davison County’s staff attorneys.

Two proposals for managing water sources

Posted on: May 14th, 2018
by David Ganje

The state Water Management Board (WMB) was created in 1955. The legislature gave authority to the WMB with supervision of the waters of the state, including measurement, appropriation, and distribution of waters. The WMB consists of seven members appointed by the governor.

In this column I argue that the exercise of good water management choices is absent on the two subjects I discuss. I do not challenge the professionalism or commitment of the staff of the Department of Environment and Natural Resources (DENR). Nor do I criticize the good faith of the WMB whose members consist of volunteer citizens of the state appointed with the legal authority to decide who should have and who should be denied a permit to appropriate the waters of the state. I discuss two issues under which the WMB is given leadership with the assistance of the DENR.

Waters of the state are held in trust for the benefit of all the residents of the state, making members of the WMB legal trustees acting on behalf of the citizens of the state. Board members are charged with protecting and managing the state’s water supply for both surface and groundwater.

The following are the two issues reviewed in this opinion piece as well as my proposals. On the first issue the Board should require a permit applicant’s disclosure of past violations or bad acts. On the second issue the Board should require that large-quantity water use applicants provide a report showing that a permit, if granted, will not harm the recharge of the particular aquifer that is to be permitted.

The first problem: Water use permit applications do not require disclosure of past bad acts or of an applicant’s business relationship with other operations that may have had violations of the law. A properly drafted “bad actor” rule would allow the WMB to deny permits to applicants with a record of law violations or who have had poor compliance with other agency directives or rules. The state DENR enforces a law in another area of permitting (concentrated animal feedlot operations, with the acronym CAFO). Under this law an applicant must disclose material information on their permit paperwork. Bad actors cannot hide when making a CAFO permit application. However the WMB has no such rule for water permit applications. It should. The WMB has rulemaking authority to do this.

The second problem is one I have addressed before. It is not new advice. However your humble practitioner’s prior recommendation has fallen on deaf ears. A particular South Dakota statute requires the WMB to determine that the average estimated withdrawal of groundwater by an applicant does not exceed the average estimated annual recharge of water in the aquifer to be used. A circuit court a few years ago ruled that using historical data from existing state observation wells does not fulfill the requirements of the statute. In that case the court said that the statute “requires not only analyzing existing and historic drawdown and recharge to the [permitted] aquifer, but also how the applicant’s [requested] drawdowns will affect the recharge to the aquifer.” The judge ruled that the WMB’s findings which show a draw of 720,000 gallons per day failed to take into account what affect the use of 720,000 gallons per day would have on the particular aquifer. The court noted that a recharge study of the subject aquifer was not included in the permit application. The court reversed the approval of the permit given by the WMB.

And just this year the WMB approved a large-quantity groundwater permit without requiring a recharge study. Such a study should take into account what effect the applicant’s use has on the particular aquifer. The approved applicant in the recent matter would be able use up to 30,000 gallons per hour when pumping. In granting the permit the WMB relied on state observation wells and historical data without a specific report showing what the recharge would be on the identified water source. I previously recommended that a water permit applicant, who will use large quantities of water, provide an aquifer recharge study as a required part of the application process. For a sustainable system the amount of water withdrawn from a particular aquifer should be balanced with the amount of water returned (recharged) by nature to that particular aquifer. The state’s existing water use policy which forbids the “mining” of the public’s water would be better served by requiring this specific water information. The requirement for a recharge study does not exist in the state’s current water code or in WMB rules.

The WMB, as an agent of the people, has general supervision of the waters of the state which includes measurement, appropriation and distribution. The duty of an agent is to guide the events in his control to a good result. The WMB is empowered with authority to establish procedures and criteria for issuing water permits. I have tendered two proposals which should be adopted by the WMB.

David Ganje practices in the area of natural resources, environmental and commercial law.

South Dakota’s version of Alice in Wonderland

Posted on: April 19th, 2017
by David Ganje

What are non-meandered water bodies in South Dakota? In Alice in Wonderland the mock turtle says, “Well, I never heard it before; but it sounds uncommon nonsense.” Non-meandered is a surveying and legal term for what are called temporary water bodies. The term in basic concept means waters that are ‘shallow or likely in time to dry up.’ And, of course time is a relative concept for sure. In 2004 the South Dakota Supreme Court in the Parks case declared that such water bodies were public water bodies even though the land underneath, the lake beds, could remain privately held property. Importantly, Parks held that all waters including non-meandered waters are public property. Yes, the law can be schizophrenic. Current law pits land rights against water rights and creates a legal no-mans-land.

I was not involved in the Parks case, and on reviewing the decision I was not convinced the parties in the case presented the best arguments or even undertook the best legal strategy. I did nevertheless use this case as an illustrative case when I taught a law class a while back. The case is an example of how complicated even natural resources law can be when the two legal concepts meet. We have under the Parks decision schizophrenic property claims: one granting public property rights to the water and one granting private property rights to the underlying and surrounding land. The landowners in Parks received no remedy from the Court which deferred the real problem to state government.

Modern medicine has had good success in treating those diagnosed with schizophrenia. Such success is not the case concerning the legal schizophrenia I describe in this article. In Parks the Supreme Court said that unresolved issues of management of these public water bodies should be taken care of by state government. The Court pretty much directed state government to do something about it. That’s a tall request in a short world. The state Game, Fish and Parks three times proposed legislation to the South Dakota legislature in an attempt to cure this legal schizophrenia. All efforts presented to the legislature have been to no avail. One should not expect the inmates in bedlam, that is state legislators, to recognize there might be a problem. I may have maligned the wrong party by calling the law (as an institution) schizophrenic. It strikes me that the legislature needs therapy.

In 2014 private landowners, seeing no relief in sight went back to court. I guess the wise principal of once burned twice shy is asking too much of those who exercise too much faith. Several landowners filed a new lawsuit claiming these public water bodies are misused by outdoor enthusiasts. More particularly landowners in the lawsuit claimed that outdoor enthusiasts were ‘firing guns, blaring music, operating loud machinery, getting drunk, littering and so forth.’ To me this sounds like the bar scene in Aberdeen a few years ago. Yet even so, I fully understand the frustration of the complaining landowners. Management of these newly declared public waters is necessary. Landowners optimism in seeking relief in the courts was however what we should call blind faith. A full and complete remedy did not occur. In this second court go around, the Supreme Court stated, “. . . until the Legislature acts, neither the public nor the Landowners have a superior right to use the waters and ice overlying the Landowners’ private property.” Hunting and fishing is integral to the economy. Game, Fish and Parks in a recent report stated that outdoor activities have a significant effect on the state “generating nearly $1.9 billion dollars in economic activity” in 2016. So, alas, legislators not wishing to deport themselves as thoughtful leaders have dutifully ignored this legal problem. Welcome to Alice in Wonderland.

David Ganje of Ganje Law Offices practices in the area of natural resources, environmental and commercial law.

South Dakota Drainage Problems

Posted on: February 17th, 2017
by David Ganje

Many are searching for a solution to the continuing problems and conflicts on the subject of water drainage in South Dakota. As reported in my previous articles, county commissioners in the state have fundamental authority over these issues. Unfortunately, not all counties in the state have faced theses legal responsibilities head-on. As of 2013 it could be reported however that one particular county has it right, and can act as a model for others. Yankton County pinpointed the specific water drainage issues affecting their county, and determined how to resolve them. Perhaps these steps will inspire other counties to work as diligently.

Based on the observations and conclusions of Patrick Garrity, the successful and reputable Yankton County official in charge of the drainage program for the county, the first act the county took was to step back and analyze how water drainage problems, along with the little-heeded laws and regulations, affect the county. To do this, Yankton County used a wetland conservation service to analyze its 500 square miles of land. The analysts found that almost half of Yankton County falls under the category of wetland, and had a solid potential for tile drainage systems in order to improve crop production. When faced with the knowledge of how much tile drainage could improve the county’s agricultural lands and economy, the Planning and Zoning Committee knew they had to act on this information.

Before discussing the Yankton ‘miracle’ further, I will say a few words about countywide comprehensive plans. A “comprehensive plan” is a county legislated plan required by South Dakota law for each county. The plan must be implemented prior to creating general zoning and water drainage ordinances. A comprehensive plan is a document that describes in words, and may illustrate by maps, plats, charts, and other descriptive matter; the goals, policies, and objectives of the county board to interrelate all functional and natural systems and activities. Without a plan, zoning ordinances, including drainage ordinances, are invalid and unenforceable. The South Dakota Supreme Court has spoken and pretty much said, ‘Hey, you need a plan.’ Nevertheless, few counties have listened. To paraphrase what the Supreme Court said: A county commission has only those powers as are expressly conferred upon it by statute. With regard to water drainage problems, the power of county commissions to adopt ordinances is contained in a South Dakota specific planning statute: ‘For the purpose of promoting health, safety, or the general welfare of the county the board may adopt an ordinance to regulate . . . the location and use of buildings, flood plain, or other purposes.’ But a county must first adopt a comprehensive plan before adopting water drainage ordinances; it is impossible to adopt an ordinance implementing a required comprehensive plan if that plan, the first required step, does not exist. The first watchword to success in water drainage is a comprehensive plan.

Now let us observe the experience of Yankton County. Previously, the drainage commission of Yankton County used permits to decide drainage issues, mainly for economic reasons; issuing permits was a lot cheaper than having the issue settled in court. However, there were several problems with the commission’s previous system. First, it was terribly informal – all a farmer had to do to apply for a permit was state what they wanted to do, where, and roughly how. In most cases, these inquiries did not go further unless someone contested the permit application. Second, due to low application criterion, the drainage board often ran into problems by granting permits to those who did not use them properly. Because of these problems, it was evident that change was needed.

To solve these issues, Yankton County held meetings to discuss the problem and possible solutions. The county formed a commission of experts from all sides; including those who opposed tile drainage, and those who supported it, to study the problems. The commission considered each viewpoint and each professional opinion. The commission met once a month for 18 months, and succeeded in enacting an effective drainage ordinance.

The heart of Yankton County’s new, and effective, drainage ordinance had its roots in reestablishing the parameters under which the reestablished Yankton Drainage Board would base their findings and decisions. Specifically, they referenced the National Resource Conservation Service’s (NRCS) soil conservation handbook to create a more concrete and specific basis for allowing drainage permits. This resulted in more explicit guidelines and standards for the board to follow. This is what I call good baseline guidance and management.

The final step is to use concrete facts and evidence in the county’s application process to make decisions. As Mr. Garrity stated, “You cannot create a finding from an emotional standpoint,” meaning that concrete evidence and specific examples are required when contesting or offering ideas. By using concrete facts and evidence, the county is better able to make productive decisions, rather than simply arguing over their own personal opinions; an issue many counties today are facing.

Yankton County has also employed the use of the most current technology and systems available, such as LiDAR. LiDAR stands for Light Detection and Ranging; it is an optical sensing technology that can measure the distance between properties and can more definitely draw property lines. Therefore, LiDAR can solve many of the problems associated with water drainage systems. The technology’s outstanding accuracy gives the Drainage Board definitive facts, and has made a huge difference in how decisions are made.

By following these steps, Yankton County has been able to enact effective water drainage laws. They have instilled more confidence in the board by giving them specific criteria to follow, and provided solid facts on which to base every decision. In addition, by involving commissioners from different backgrounds and of multiple opinions, they have guaranteed that the decisions are not only best for everyone, but also just. Yankton is also promoting education on this subject, so more county residents can understand the problem and work to implement the solution. As of 2013 Yankton County was a model for getting water drainage right.

Author: David Ganje. David Ganje of Ganje Law Offices practices in the area of natural resources, environmental and commercial law.

Wetlands mismanagement – American style

Posted on: February 15th, 2017
by David Ganje

Wetlands play a role in the ecosystem and provide benefits for both people and wildlife. Society’s idea of wetlands management includes protecting water quality, storing floodwaters, retaining groundwater during dry periods, and providing food. Wetlands are also a source of biodiversity and serve as a habitat for species of fish and wildlife. It is estimated that one hundred years ago, the U.S. had over 221 million acres of wetlands. Today, the number is 107.7 million acres. The decline in the wetlands is linked, in part, to modern agricultural production. The government estimates that there are 6.4 million acres of wetlands in the prairie pothole region of South Dakota, North Dakota, Minnesota and Iowa. While I wrote about current languishing federal legislation addressing wetlands in a prior opinion piece, this article discusses the bureaucratic management of wetlands by the USDA.

The U.S. is not the old super-bureaucratic Soviet Union; nevertheless, the U.S. has a myriad of federal bureaucratic agencies, departments, services, divisions and offices, particularly within the USDA. For the convenience of the reader (and myself) I refer to all USDA related offices or divisions as simply ‘USDA’ instead of using the alphabet soup abbreviation for the particular office within the USDA.

Let me set the stage. The USDA has been involved in the wetlands management since 1977. Farmers, ranchers and landowners are incentivized to preserve the wetlands on their property by receiving government benefits. Beginning in 1990 and continuing through 1996, the USDA created maps to show wetlands determinations, or more specifically what was and was not a wetland. So that we don’t get lost in the timeline, I refer to the maps created during this time as “pre-1996 maps.” In 1996, the USDA completed several internal studies and concluded that the pre-1996 maps were not accurate and should not be used. Between 1996 and 2013, the USDA moved to a more comprehensive system to determine what is and isn’t a wetland. This new system was more accurate than the pre-1996 maps because it relied on several different techniques, such as onsite evaluations, maps, aerial photography, and soil samples.

Now here is the kicker. In 2013 the agency stopped using onsite evaluations, aerial photography and soil samples and reverted back to issuing wetlands determinations using the inadequate pre-1996 maps. Thus, in 2013 the pre-1996 maps were to be the ‘new’ method of making wetlands determinations. Alas, these older maps sometimes underestimate the amount of wetlands on a piece of property. For example, by using an inaccurate pre-1996 map the agency caused the reduction of wetland acreage in North Dakota by nearly 75% on 13 tracts. In another example, a 2010 map showed 34 acres of wetland on a tract of land but the pre-1996 map showed that the tract only had 2.5 acres. Since the USDA approved a landowner’s petition, the producer drained 31.5 acres of wetlands without being penalized with the loss of farm benefits. Remember the agency first asserted that the pre-1996 maps were unacceptable in 1996, yet they repeatedly reaffirmed this position over the years, most recently in a 2012 report. In 2013 the agency reversed this position so it could use the pre-1996 maps. Curiously, during this confusing time South Dakota USDA officials decided, on their own, not to follow their own USDA directives. USDA bumbling has created interstate chaos in wetlands management. The lack of uniformity in applying the rules caused complaints. I have yet to deal with a landowner who has experienced uniform treatment under the wetlands program.

Adding to the bumbling, senior officials finally realized that there was an inconsistency in the way wetlands determinations are decided between different states. In 2013 the USDA stated it would “clarify” its new decision-making process. It did not. The agency did not published anything on its official decision to revert back to the pre-1996 maps for over three years. And we were all taught that only families could be dysfunctional. This messy stew resulted in an Inspector General investigation and report.

Bumbling. Now I admit to bumbling some of my games of chess, however that is not the question at hand. But to the point: we all hold a low opinion of the stupidity of a bumbling government agency, and yet we all know we gotta have government. Just try to live without the security and benefits of a government – you will need to be a pretty good shot as well as a full time prepper, and yet you still won’t have a long shelf life.

So, let’s figure out what to do on the issue of wetlands management. The USDA has blown it. It is now incumbent upon USDA to get its act together and quickly. We must remember that the individual landowner does not always directly get the eco-benefits and the financial advantage by the imposition of wetlands management upon his land. It can happen, that is, the USDA may determine that private property should be regulated for the protection of a particular body of water or a species. Such action does not benefit the immediate landowner but rather benefits the environment and is the country’s form of stewardship of the land. We will have to live with a rational management of wetlands or choose to become the Wild West of environmental management as the Chinese tried for about 30 years. Go ask them now if that was a good idea.

The USDA Inspector General last month issued his critical report stating the USDA should, “Issue official guidance reinforcing correct and current rules and clarifying procedures for making wetland determinations…, including the status of pre-1996 determinations.” The USDA accepted the Inspector General’s criticism and declared it would provide clarification and specific guidance to evaluate the status of prior determinations. It’s a start. The USDA will need to learn how to chew gum and walk at the same time; it must both fix yesterday’s problems as well as manage wetlands rationally going forward.

Wetlands management may be a problem in which ‘institutional bypass’ is in order. In this case by institutional bypass I mean contracting with private enterprise to take care of the backlog of problems and create a fair and streamlined access to wetland determinations.