South Carolina              
Administrative Law Court
Edgar A. Brown building 1205 Pendleton St., Suite 224 Columbia, SC 29201 Voice: (803) 734-0550

SC Administrative Law Court Decisions

CAPTION:
Hospital Land Partners, LLC vs. SCDHEC

AGENCY:
South Carolina Department of Health and Environmental Control

PARTIES:
Petitioner:
Hospital Land Partners, LLC

Respondent:
South Carolina Department of Health and Environmental Control, Office of Ocean and Coastal Resource Management
 
DOCKET NUMBER:
99-ALJ-07-0532-CC

APPEARANCES:
Messrs. Harold W. Jacobs, Leon C. Harmon and John W. Davidson,

for Hospital Land Partners, LLC

C.C. Harness, III, Esquire, for Hall Development and Glenn Hall

James S. Chandler, Jr., Esquire, for Carl Hyszczak, et al.

Mary D. Shahid, Esquire, and Leslie W. Stidham, Esquire,

for the South Carolina Department of Health and Environmental Control, Office of Ocean and Coastal Resource Management
 

ORDERS:

FINAL ORDER AND AND DECISION

STATEMENT OF THE CASE

This matter comes before the Administrative Law Judge Division ("ALJD") pursuant to various challenges by: (1) Hospital Land Partners, LLC ("HLP"); (2) Hall Development ("Hall") and Glenn Hall; and (3) Carl Hyszczak and other residents of Myrtle Trace Subdivision ("Residents"), to the decision by the South Carolina Department of Health and Environmental Control ("DHEC"), Office of Ocean and Coastal Resource Management ("OCRM"), imposing requirements for issuance of a stormwater management permit. HLP originally contested OCRM's requirements. Hall and the Residents contested the project's consistency with the Coastal Zone Management Act, Coastal Zone Management Program Document, and the South Carolina Stormwater and Sedimentation Reduction Act. These challenges were consolidated for hearing purposes pursuant to an Order for Consolidation dated December 21, 1999. A hearing was held on April 10 and 11, 2000 at the offices of the ALJD.



FINDINGS OF FACT

Upon observing the witnesses and exhibits presented at the hearing, closely passing upon their credibility, and taking into consideration the burden of persuasion by the parties, I make the following Findings of Fact:

  1. HLP is a limited liability company which owns approximately 8.55 acres near Conway, South Carolina, which is the tract at issue ( "Property"). The members of HLP are Thomas S. Roe ("Roe") and Dr. Michael L. Hodge ("Hodge").
  2. The Residents are persons generally residing in Phase VIII of the Myrtle Trace Subdivision, located in Horry County, Myrtle Beach, South Carolina, adjacent to the Property.
  3. Hall is the developer of the Myrtle Trace Subdivision, and Glenn Hall is the President of Hall Development.

  1. DHEC is the State agency charged with all aspects of issuing general stormwater permits. Such permit applications for property located in the coastal counties of South Carolina are reviewed by DHEC's Office of Ocean and Coastal Resource Management.

5. Hodge-Roe General Partnership is a partnership formed by Thomas Roe and Michael Hodge, for the specific purpose of acquiring property located on or near the Conway Hospital in Myrtle Beach, South Carolina. Thomas Roe is a land developer, and his partner, Michael Hodge, is a physician.

6. Prior to June 6, 1997, International Paper Realty Corporation ("IP") held fee simple title to the Property described as follows:

All that certain piece, parcel and tract of land, situate lying and being in Conway Township, Horry County, South Carolina, containing 8.559 acres, more or less, and more particularly shown on a plat entitled "Boundary Survey of the Remainder of the Hospital Tract, for International Paper Realty Corporation and Roe and Associates, Inc. by Survey Technology, Inc., dated December 3, 1997 and recorded December 31st, 1997 in Plat Book 152 at page 202 in the office of the Clerk of Court for Horry County, South Carolina, said plat being incorporated herein by reference.



7. IP had developed a business relationship with Hall Development regarding the development of a larger tract of land that initially included the Property. In the late 1980's, IP had negotiated an agreement with Hall Realty and Investment Company for development of the tract of land known as "Southbridge." Southbridge was a 58.114-acre tract proposed for a multi-use development, located between Burning Ridge Road, Myrtle Trace Drive, and the Conway Hospital. The Property purchased by HLP was originally part of this 58.114-acre tract.

  1. Pursuant to the agreement between Hall Development and IP, Hall Development would develop the property, and then would purchase the lots from IP, as the lots were finished. The lots were to be developed and purchased with a certain time frame, commonly known as a "take-down" agreement. Under this arrangement, Hall Development, through its principal, Glenn Hall, was responsible for obtaining state, local and federal permits, zoning approvals, and constructing all utilities etc. required for the development of the land.
  1. In accordance with this arrangement with IP, Hall Development obtained permits for the Southbridge Development. The joint state and federal permitting action regarding the Southbridge Development was permit SAC-26-89-531T. This permit was a combined authorization of the U. S. Army Corps of Engineers, through their Nationwide Permit 26, and a coastal zone consistency certification from the State of South Carolina, through the South Carolina Coastal Council (the predecessor to OCRM).
  2. Southbridge Development proposed to develop the 58-acre tract into residential subdivisions with a commercial area located in the northwestern corner of the tract. Six individual,


isolated, freshwater wetlands were delineated on the 58-acre tract. These wetlands were identified as wetland areas A, B, C, D, E, and F.

11. The smaller of these wetland areas, A, C, and F, were shown as impacted by the Southbridge Development. These wetlands were proposed to be filled, and the total amount of wetland fill shown on the Southbridge state and federal permit application was 1.029 acres. The U. S. Army Corps of Engineers provided authorization for this fill.

  1. In exchange, and as mitigation for, the impacts to wetland areas A, C, and F, Hall Development proposed to protect the wetland area known as wetland B, consisting of 4.689 acres. In addition, Hall Development proposed a substantial high-ground buffer around wetland B. Wetland B, and its adjacent buffers, is located within the Property currently owned by HLP. The amount of area on this tract recommended for preservation was 8.337 acres.
  2. Pursuant to the joint public notice process by the Corps of Engineers and the Coastal Council, the state and federal resource agencies were notified of this project and commented on the proposal. The South Carolina Wildlife and Marine Resources Department (predecessor to the Department of Natural Resources) and the United States Fish and Wildlife Service did not object to the wetland impacts, based on the preservation proposed with wetland B.
  3. On November 21, 1989, H. Stephen Snyder, Director of Planning and Certification for the South Carolina Coastal Council, advised LTC James T. Scott, District Engineer for the Charleston District, U. S. Army Corps of Engineers, that the plans for the development known as Southbridge were consistent with the South Carolina Coastal Zone Management Program Document.
  4. In the early 1990's, Hall Development began obtaining permits for the infrastructure to the residential development shown on the Southbridge plans, known now as Myrtle Trace. Hall obtained stormwater permits, and water and sewer line permits. Lots were developed in Myrtle Trace and sold. Most of the named Petitioners are homeowners in the Myrtle Trace Subdivision, located on or near Candlewood Drive.
  5. The stormwater management plan for Myrtle Trace utilized the canal between the HLP site and Myrtle Trace for detention of storm-water.

  1. In the late 1980's and early 1990's, the policies of the Corps and OCRM's predecessor, Coastal Council, did not include a requirement that a permittee record restrictive covenants and/or conservation easements to protect wetlands, wetland buffers, and land provided as mitigation for Corps dredge and fill permits. Since the early 1990's, the policies of the Corps and OCRM have been modified to require permittees to record in the real property records of a county deed restrictions, restrictive covenants, or conservation easements for the protection of preserved wetlands and buffer areas. This requirement is incorporated into the conditions required by OCRM to bring the HLP project into consistency with the CZMA and the Coastal Zone Management Program.

  1. The South Carolina Wildlife and Marine Resources Department, in commenting to OCRM in 1989 regarding certification of the Corps' permit for Myrtle Trace Phase VIII, indicated that it is imperative that restrictive covenants be placed on undisturbed wetlands and buffer areas to protect them from future destructive activities. This recommendation was not heeded. No restrictive covenant nor conservation easement was executed by either Hall or IP regarding the mitigation on the Property.

  1. In approximately 1995 or 1996, Glenn Hall showed Tom Roe, one of the members of HLP, various properties in the vicinity of the Myrtle Trace Subdivision on Singleton Ridge Road for the possible development of an apartment complex by Roe. During that visit, Mr. Hall also showed Mr. Roe the Property. Mr. Hall explained that the property in this area was owned by IP, and was being developed by Hall. Mr. Hall then introduced Mr. Roe to Allan Moore, who manages IP's real estate portfolio in South Carolina. Mr. Roe did not purchase any property from IP at that time.

20. In late 1996 or early 1997, Mr. Roe and Dr. Hodge became interested in developing a medical office building in the same vicinity due to its proximity to the Conway Hospital Campus. Mr. Roe contacted Mr. Moore regarding the availability of the Property. Mr. Moore told Mr. Roe that the Property was available but that the Property was "messed up." Mr. Roe understood this to mean that the Property had title problems. Mr. Moore also told Mr. Roe that the Property had potential problems with a Corps of Engineers permit.

21. Thereafter, on June 6, 1997, the Partnership entered into an option agreement with IP to purchase the Property for $225,000. Pursuant to this option agreement, the Partnership had the option of purchasing this tract if it could determine that the tract could be developed.







22. The Partnership then engaged the services of a local attorney, Bob Gwin, to conduct a title examination. The title examination revealed a deed out of IP to the South Carolina Department of Transportation ("DOT") which affected a significant portion of the Property. After various negotiations, DOT executed a quitclaim deed conveying this portion of the Property back to IP.

23. The Partnership also commissioned a wetland redelineation to be conducted by the Brigman Company, the same wetlands consultant which had conducted the earlier wetlands delineation for Hall. The Brigman Company surveyed the wetlands, prepared a wetlands delineation for the Property, and submitted the redelineation to the U.S. Army Corps of Engineers for approval. The Corps approved this delineation, and it was subsequently verified as accurate by DHEC/OCRM. Neither the Brigman Company nor the Corps of Engineers indicated that the Property was included in a prior mitigation plan.

24. The redelineation of the wetlands indicated significantly less wetlands on the Property than the delineation that had been performed for the Corps of Engineers permit for Myrtle Trace Phase VIII. Less than 0.8 acres of wetlands remain on the site. It is possible that this resulted from a combination of factors, including changed Corps wetland delineation guidelines, the excavation of the adjacent wetland and the creation of the drainage canal constructed earlier between the Property and the Myrtle Trace Phase VIII lots.

25. The Partnership did not undertake to have the Property rezoned prior to purchase.

26. The Partnership purchased the Property by deed from IP dated December 12, 1997. Subsequently, the Partnership deeded the Property to HLP.

27. Sometime after acquiring the Property, HLP had the timber on the Property harvested, taking steps to ensure that a fifteen-foot buffer of trees was left along the property lines. HLP contacted the Brigman Company prior to harvesting the timber to verify that this activity did not require a permit. Thereafter, various Residents and Glenn Hall contacted HLP to voice their opposition to the development of the Property.





28. During this time, HLP submitted an application to Horry County to have the Property rezoned after deciding not to develop a medical office building but rather to develop an assisted living facility. HLP subsequently met with various groups of residents of Myrtle Trace to explain the development.

29. During the rezoning process, the Chairman of the Horry County Planning Commission indicated to HLP that it was his recollection that the Property was a mitigation site. The Commission deferred action on HLP's rezoning request until HLP obtained a letter from the Corps of Engineers stating that the Property was not a restricted mitigation site. This letter was requested by the Brigman Company by letter dated September 9, 1998.

30. The Corps responded by letter dated December 1, 1998 which states in pertinent part:

A review of the information available to this office indicates that this property was offered as mitigation for permit SAC-26-89-531T, however a check of our records indicates that no easement or covenant on this property was ever executed and as far as this office is concerned, you may proceed with any work in areas not designated as jurisdictional by the above referenced delineation.



31. This letter was then presented to the Planning Commission after which HLP was required to obtain a similar letter from OCRM. The Brigman Company requested this letter; however, OCRM refused to issue such a letter because research showed that the Property had at one time been offered by Hall as mitigation for wetlands filled by it.

32. On July 7, 1999, HLP submitted an application to OCRM seeking a stormwater management and sediment control permit pursuant to S. C. Code Ann. §§ 48-14-10, et seq. (Supp. 1999) and 26 S.C. Code Ann. Regs. 72-300, et seq. (Supp. 1999).

33. The application, submitted by Robert L. Bellamy, Jr. as agent for HLP, sought approval of a plan to disturb 7.77 acres of land for construction of a residential care facility. The application indicated that no wetlands were being disturbed. The area of land disturbance encompassed both the area known in 1989 as Wetland B, and the high ground buffer. HLP proposed to construct the facility with numerous parking places located in front of the facility.



34. HLP's stormwater application was placed on public notice. Myrtle Trace property owners raised objections to the project.

35. After discussion among the staff, OCRM sent a letter dated September 27, 1999, concluding that the project was inconsistent with the Coastal Zone Management Program. The letter set forth the policies in the Coastal Zone Management Program Document with which the project was inconsistent, as well as several items that, if accomplished, would bring the project into consistency:

a. Provide for a buffer around the wetlands on the HLP property

and the adjacent tract, which is adjacent to the southern property

line of the HLP property.



b. Redirect the storm water runoff at several locations into the

wetlands.



c. Require replanting of vegetation to replace the vegetation that

was cleared. This was to re-establish the natural screen between

the wetland and the upland area.



d. Purchase credits in an off-site mitigation bank, in order to

mitigate for the difference in the amount of wetlands that were

delineated in 1991 and the current amount.



e. Formally preserve all of the wetlands and buffers in the area

with a standard deed restriction.



f. Raise the outfall structure that is located adjacent to

the canal in the Myrtle Trace subdivision.

36. Since the September, 1999 letter was written, the OCRM staff conducted another review of the area and concluded that raising the outfall structure in the canal is not necessary because it appears that this may present a danger of flooding certain houses located on Candlewood Drive in the Myrtle Trace Subdivision. Additionally, OCRM further refined its position in the hearing regarding the amount of mitigation credits necessary for this project to be no more than $20,000 of credits, or a lesser amount if such is supported by the calculation analysis formulated by the Corps.



37. OCRM represented that if these conditions were met, the HLP permit application would be consistent with the Coastal Zone Management Act which would mean that the stormwater management permit would issue to HLP. At this point in the hearing HLP agreed to the modified conditions and withdrew any claims previously raised contesting the authority of OCRM to require such conditions.

38. The purpose of the stormwater program is to control water runoff. The measure of runoff is the peak level of runoff prior to development versus the peak level post-development, and the goal is to ensure that the post-development runoff does not exceed pre-development runoff for the hypothetical design storm.

39. OCRM's Engineer in charge of the stormwater program has reviewed the runoff calculations pursuant to R. 72-300, et al. In order to comply with the stormwater regulations, the project will have to be reconfigured. This project, however, has sufficient high ground so that, if configured properly, post-development runoff will not exceed pre-development runoff.

40. OCRM has verified that the wetland conditions have changed on the property. The size of the wetland has been reduced to two small wetland areas of less than 0.8 acres in size. The loss of wetlands, whatever the reason, occurred over time, prior to Mr. Roe's purchase of the property.

41. The redirection of the stormwater runoff will allow the wetlands to remain the same size and possibly increase in size.

42. From a water quality perspective, buffers, which are areas adjacent to wetland systems that are left undisturbed, exist to protect wetlands. The size of the wetland is taken into consideration when determining the size of buffer to be required, as well as whether there are direct impacts to the wetland.

43. The 32-foot buffer that has been set aside on the HLP tract will adequately function as a stormwater buffer. The width of buffer that OCRM normally requires varies, depending on whether there are direct wetland impacts. If there are no direct wetland impacts, OCRM typically requires a buffer of approximately 20 to 25 feet in width. If there are direct wetland impacts, then the width is increased to an average size of 50 feet.



44. There are to be no direct wetland impacts on this property, such as filling or dredging of wetlands.

45. The mitigation plan for this project includes both buffers and mitigation banking. All of the federal and state agencies that are involved with wetland protection have endorsed mitigation banking as a proper form of mitigation.

46. The public benefit associated with mitigation banking is the restoration of a previously degraded area and long-term preservation of that area.

47. With regard to the restrictions on the HLP property, the buffer that was provided for in the prior Corps permit was not recorded in the local RMC office. OCRM now requires such conservation easements and restrictions to be recorded, to avoid situations such as this one.

48. At the time that Mr. Hall offered Myrtle Trace Phase VIII as mitigation for his Corps 404 permit, Hall Development was not the owner of the property.





CONCLUSIONS OF LAW



1. The Administrative Law Judge Division has subject matter jurisdiction in this proceeding pursuant to S.C. Code Ann. § 1-23-600(B) (Supp. 1999) and §§ 1-23-310 et seq. (1986 & Supp. 1999).

2. S.C. Code Ann. § 48-39-150 (Supp. 1999) specifically authorizes the Administrative Law Judge to hear contested cases arising under Chapter 39 of Title 48 of the South Carolina Code of Laws, 1976, as amended.

3. As a statewide administrative tribunal authorized to take evidence and determine contested case hearings, the Administrative Law Judge Division is the fact finder in this matter for purposes of administrative and judicial review. Lindsey v. South Carolina Tax Comm'n, 302 S.C. 504, 397 S.E.2d 95 (1990).

4. The burden of proof rests upon the party who asserts the affirmative of an

issue in an adjudicatory administrative proceeding. 2 Am. Jur. 2d Administrative Law § 360 (1994).

5. OCRM is the subdivision within DHEC charged with implementing the State's coastal zone policies and issuing permits in coastal zone areas.

6. S.C. Code Ann. § 48-39-80(B)(11) (Supp. 1999) gives OCRM the authority to review all state and federal permit applications in the coastal zone and to certify that these do not contravene the Coastal Zone Management Program.

7. The South Carolina Stormwater Management and Sediment Reduction Act, S.C. Code Ann. §§ 48-14-10 et seq. (Supp. 1999), and 26 S.C. Code Ann. Regs. 72-300 et seq. (Supp. 1999) were promulgated to require developers to obtain a permit prior to commencing land disturbing activities, to ensure that stormwater runoff is properly managed during and after construction of a development or other project.

8. S.C. Code Ann. § 48-14-50 (Supp. 1999) provides that DHEC shall develop a State Stormwater Management and Sediment Reduction Program, as well as promulgate regulations pursuant to Chapter 14.

9. 26 S.C. Code Ann. Regs. 72-304(F) (Supp. 1999) provides that OCRM, formerly the Coastal Council, is the implementing agency for the stormwater management regulations in the coastal zone.

10. The Coastal Zone Management Program Document contains the goals and policies that OCRM must consider when reviewing development projects in the coastal zone.

11. In any decision to grant or deny a coastal zone permit, OCRM exercises significant discretion. See S.C. Code Ann. § 48-39-50 (Supp. 1999) [giving DHEC/OCRM broad regulatory authority over the coastal zone and the authority to exercise all incidental powers necessary to carry out the provisions of the Coastal Zone Management Act]; S.C. Code Ann. § 48-39-80 (Supp. 1999) [giving OCRM broad authority to develop the Coastal Zone Management Program and to certify a project's consistency with the Program]. OCRM must, within its discretion, apply governing statutory principles. See Deese v. State Bd. of Dentistry, 286 S.C. 182, 332 S.E.2d 539 (Ct. App. 1985) [agency decision must be governed by applicable authority].

12. In the general guidelines applicable to all projects, OCRM must:

promote the economic and social improvement of the citizens of this

State and . . . encourage development of coastal resources . . . with due

consideration for the environment and within the framework of a

coastal planning program . . . .



S.C. Code Ann. § 48-39-30(B)(1) (Supp. 1999); Coastal Zone Management Program Document, Chapter III, Section C(I)(1)(a).



13. Hall and the Residents express concern that OCRM's proposed "mitigation settlement plan," as revised during the contested case hearing, may constitute a settlement agreement with HLP without the requisite consent from project opponents. Hall and the Residents argue that such a settlement would deny them an opportunity to be heard at a meaningful time and in a meaningful manner on the issues in this case.

This contested case proceeding has afforded the project opponents an opportunity to be heard at a meaningful time and in a meaningful manner concerning the consistency of OCRM's proposed mitigation plan with the Coastal Zone Management Program. If OCRM grants a stormwater management permit to HLP after HLP has submitted the necessary revised stormwater plan, any project opponents will be entitled to a contested case hearing on any alleged deviations of HLP's revised plan from OCRM's proposed mitigation plan.

Regulation 72-313 provides for an individual's entitlement to an administrative hearing to determine the propriety of the requirements imposed by the implementing agency for approval of a stormwater management plan. 26 S.C. Code Ann. Regs. 72-313(A)(5) (Supp. 1999). OCRM's letter of September 27, 1999 does not deny the stormwater management permit, but rather merely imposes requirements for approval of a stormwater management plan. Although OCRM must continue to process the application once HLP has submitted the necessary revised plan, the parties were immediately entitled to a contested case hearing on the issues encompassed by the September 27, 1999 letter pursuant to R. 72-313(A)(5). The September 27, 1999 letter does not have to be a "final staff decision" to be subject to a contested case hearing, as R. 61-72, §§ 101(I) and 201 provide that an order on which a party may request a hearing includes any decision from which an appeal may be taken pursuant to applicable law or regulation. Regulation 72-313(A) provides for such a hearing even where OCRM simply imposes requirements for approval of a stormwater permit. While OCRM's use of the term "mitigation settlement plan" is confusing, it does not control case procedure; therefore, the concerns of Hall and the Residents that OCRM and HLP may enter into a settlement agreement without their consent are misplaced. Nothing in the September 27, 1999 letter implies that the permit is granted with special conditions imposed. Indeed, OCRM implies that HLP must submit a revised stormwater plan before HLP's permit application can be approved. (1) Hall and the Residents have had an opportunity to be heard on the consistency of OCRM's proposed mitigation plan with the Coastal Zone Management Program in this contested case proceeding. If OCRM approves HLP's revised plan and issues a permit, any project opponents may request a contested case hearing on any alleged deviations of HLP's revised plan from OCRM's proposed mitigation plan pursuant to R. 61-72.202(A) (Supp. 1999), which allows for a hearing on a "final staff decision."

14. HLP's agreement to abide by the conditions contained in OCRM's September, 1999 letter as modified in the hearing resolves any matters between OCRM and HLP. As such, the issues raised by HLP have been resolved and do not require treatment herein. Therefore, the only remaining challenges are those raised by Hall and the Residents.

15. Inclusion of buffer areas is encouraged in commercial development plans in areas where flooding has been a problem. Coastal Zone Management Program Document, Chapter III, Section IV(1)(c). OCRM is requiring buffers averaging 32 feet around the wetland areas on the Property, instead of the average 50-foot buffers for commercial uses required as mitigation when a proposed project will directly impact wetlands. See Coastal Zone Management Program Document, Chapter III, Section XIV. Buffers are important, not only for screening and aesthetic functions, but also to filter stormwater, protect the adjacent wetlands, protect water quality, provide flood control, and provide habitat for wildlife. While a 50-foot buffer may provide more protection than a 32-foot buffer, the 32-foot buffer is an acceptable size based upon the size of the wetland to be protected, the type of development, and the fact that the project will not have any significant direct impact on the wetlands on the Property. I conclude that the buffer in place is adequate to function as it was intended.

16. A mitigation plan must be submitted for all projects which require a coastal zone consistency determination and impact federally defined jurisdictional freshwater wetlands in the coastal zone, unless OCRM determines that the impacts are so minimal as not to warrant mitigation. Coastal Zone Management Program Document, Chapter III, Section XIV.

In this case, the project, as revised by OCRM, will not have any significant direct impacts to wetlands on the Property as contemplated by Chapter III, Section XIV of the Program Document. OCRM's mitigation requirements in this case relate to the difference in area indicated as wetland preserve and buffer in 1991 and that resulting from approval of HLP's project, as revised by OCRM. OCRM's proposed mitigation plan requires that the reduction in the area dedicated as wetland preserve and buffer be replaced offsite at an approved mitigation bank. Offsite mitigation is acceptable, even where onsite mitigation is possible, when the mitigation will provide a significant ecological benefit to the State of South Carolina. Coastal Zone Management Program Document, Chapter III, Section XIV(B)(4). Further, OCRM has the discretion to allow mitigation banking as a form of mitigation. See Coastal Zone Management Program Document, Chapter III, Section XIV(B)(5).

17. The public is benefitted by the mitigation banks from which HLP must purchase credits by wildlife management values, the protection of a unique area, enhanced water quality, and the restoration of previously degraded natural areas. Additionally, such mitigation banks go through mitigation banking and review process with various governmental agencies.

I conclude that the buffers and the purchase of credits in a mitigation bank to mitigate for the loss of wetlands that has occurred over time comply with the requirements of the Coastal Zone Management Program.

18. Hall and the Residents maintain that OCRM's proposed mitigation plan is barred under the principles of res judicata. They argue that OCRM's previous condition to its 1989 certification of the Hall Development project now precludes OCRM's alteration of the status of the Property as dedicated buffer.

The loss of wetlands on the Property originally dedicated as buffer presents a change in circumstances not contemplated by OCRM in its 1989 certification determination. It is axiomatic that the doctrine of res judicata applies only when the second action involves the same operative facts as the first action. Pye v. Aycock, 325 S.C. 426, 431, 480 S.E.2d 455 (1997) [If it is doubtful whether a second action is for the same cause of action as the first, the test generally applied is to consider the identity of facts essential to their maintenance].



19. OCRM acted within its authority to determine the project's consistency with the CZMP. OCRM's conditions for the 1989 certification of Hall Development's project does not bind OCRM in its assessment of a completely different project's consistency with the CZMP.

20. OCRM's proposed mitigation plan would protect the remaining wetlands more effectively than preservation of the status quo. In 1989, Wetland B, the original mitigation area, was 4.689 acres. In 1998, OCRM and the Corp of Engineers confirmed there were two isolated wetlands consisting of less than .8 of an acre on the site. Given that the topography of the wetlands have changed since 1989, OCRM's proposed mitigation plan appropriately alters the status of the property upon reassessment of its physical characteristics.

21. OCRM's proposed mitigation plan protects the environment in an effective manner and promotes the economic and social improvement of the citizens of this State. OCRM's plan reflects a proper consideration of all of the policies set forth in S.C. Code Ann. § 48-39-30 (Supp. 1999).

22. Hall and the Residents have presented several theories of property law which, they maintain, preclude alteration of the Property's status as dedicated buffer. This tribunal's jurisdiction extends only to the determination of whether OCRM's proposed mitigation plan is consistent with the Coastal Zone Management Program. See S.C. Code Ann. § 1-23-500 (Supp. 1999) [The Administrative Law Judge Division is an administrative agency within the executive branch of the government of this State]. Therefore, any issues relating to real property law should be resolved in another forum.

23. The Coastal Zone Management Program Document contains the goals and policies that OCRM must consider when reviewing development projects in the coastal zone. One of these goals is the development of a management program that will achieve a rational balance between economic development and environmental conservation of natural resources in the coastal zone of South Carolina. Coastal Zone Management Program Document, Chapter III, Section A. This goal includes the objective to develop a coastal program with flexibility for revision and improvement with the evolution of increased knowledge and experience in managing coastal resources. Coastal Zone Management Program Document, Chapter III, Section A (12).



24. The Coastal Zone Management Program Document also contains the following guidelines for review and certification of permit applications in the coastal zone:

GUIDELINES FOR EVALUATION OF ALL PROJECTS

1. In review and certification of permit applications in the coastal zone, OCRM will be guided by the following general considerations (apply to erosion control and energy facility projects, as well as activities covered under Resource Policies);



1) The extent to which the project will further the policies of the South Carolina General Assembly which are mandated for OCRM in implementation of its management program these being:



a) "To promote the economic and social improvement of the citizens of this State and to encourage development of coastal resources in order to achieve such improvement with due consideration for the environment and within the framework of a coastal planning program that is designed to protect the sensitive and fragile areas from inappropriate development and provide adequate environmental safeguards with respect to the construction of facilities in the critical areas of the coastal zone;



b) To protect and, where possible, to restore or enhance the resources of the State's coastal zone for this and succeeding generations." (Sections 48-39-30(B)(1) and (2), S. C. Coastal Management Act of 1977).





2) The extent to which the project will have adverse impacts on the "critical areas" (beach/dune system, coastal waters, tidelands).



3) The extent to which the project will protect, maintain or improve water quality, particularly in coastal aquatic areas of special resource value, for example, spawning areas or productive oyster beds.



4) The extent to which the project will meet existing State and Federal requirements for waste discharges, specifically point sources of air and water discharge, and for protection of inland wetlands.



5) The extent to which the project includes consideration for the maintenance or improvement of the economic stability of coastal communities.



6) The extent to which the project is in compliance with local zoning and/or comprehensive plans.



7) The possible long-range, cumulative effects of the project, when reviewed in the context of other possible development and the general character of the area.



8) The extent and significance of negative impacts on Geographic Areas of Particular Concern (GAPCs). The determination of negative impacts will be made by OCRM in each case with reference to the priorities of use for the particular GAPC. Applications which would significantly impact a GAPC will not be approved or certified unless there are no feasible alternatives or an overriding public interest can be demonstrated, and any substantial environmental impact is minimized.



9) The extent and significance of impact on the following aspects of quality or quantity of these valuable coastal resources:



i) unique natural areas - destruction of endangered wildlife or vegetation or of significant marine species (as identified in the Living Marine Resources segment), degradation of existing water quality standards;



ii) public recreational lands - conversion of these lands to other uses without adequate replacement or compensation, interruption of existing public access, or degradation of environmental quality in these areas;



iii) historic or archeological resources - irretrievable loss of sites identified as significant by the S. C. Institute of Archeology and Anthropology or the S. C. Department of Archives and History without reasonable opportunity for professional examination and/or excavation, or preservation.



10) The extent to which the project is in the national interest.

Coastal Zone Management Program Document, Chapter III, Section (C)(I) [emphasis added].

25. Based on the evidence presented, I conclude that OCRM adequately evaluated the project under the policies, goals and guidelines in the Coastal Zone Management Program Document and correctly found that the project, as revised, is consistent with the Coastal Zone Management Program.

26. The Residents maintain that the diminution in their property values should be considered pursuant to the policies of the Coastal Zone Management Program. They argue that the policies of the Coastal Zone Management Program require OCRM to take into account all of the competing economic and property interests in making a consistency determination.

In a very general sense, the Residents are correct in their assertion that all competing economic interests should be considered. Certainly, the economic interests of an entire coastal community or the citizens of the State as a whole must be considered in evaluating a project. (2) See Coastal Zone Management Program Document, Chapter III, Section (C)(I)(1)(a), (5) & (7) [guidelines for evaluation of a project include the extent to which the economic and social improvement of the citizens of this State are promoted, the extent to which the project includes consideration for the maintenance or improvement of the economic stability of coastal communities and the possible long-range cumulative effects of the project, when reviewed in the context of other possible development and the general character of the area]. I conclude, however, that OCRM's proposed mitigation plan in this case cannot be found to be inconsistent with the Coastal Zone Management Program on the basis of a possible loss of value imposed upon adjacent owners.

Valuing real property creates a factual determination. Cf. Andrews Bearing Corp. v. Brady, 261 S.C. 533, 201 S.E.2d 241 (1973) [where the court explained that no factual issue was presented since there was "no question of valuation being in issue"]. In the instant case, there is insufficient evidence to support a conclusion that HLP's project, as revised pursuant to OCRM's requirements, will diminish the value of adjacent properties. To arrive at a conclusion that the value of adjacent property is reduced, evidence of sales of similar property would need to be established showing that the presence of a similar project in the coastal zone has materially and negatively impacted the value of the adjacent owner's property. No such evidence was presented in this case.

27. Hall Development and the Residents also argue that the project is inconsistent with the Coastal Zone Management Program because proper zoning approval has not been obtained. The Residents maintain that they relied upon Hall's designation of the Property as a "nature preserve" in purchasing their property.

The Program Document states that OCRM should consider the extent to which the project is in compliance with local zoning and/or comprehensive plans. See Coastal Zone Management Program Document, Chapter III, Section (C)(I)(6). Zoning compliance, however, is only one of several general considerations, the absence of which does not necessitate a determination that the project is inconsistent with the Program. While compliance with local zoning is a consideration of the agency, it is not dispositive.

Further, the actual zoning requirement is the responsibility of local zoning authorities who exercise wide discretion in decision-making. See Bear Enterprises v. County of

Greenville, 319 S.C. 137, 459 S.E.2d 883 (Ct. App. 1995); Rushing v. City of Greenville,

265 S.C. 285, 217 S.E.2d 797 (1975). In the instant case, the evidence indicates that the local zoning authorities have deferred action on HLP's rezoning request until HLP can obtain clearance from OCRM to deviate from the previous buffer requirements.

Based on the foregoing, I conclude that the absence of zoning approval in this case does not render the project inconsistent with the Coastal Zone Management Program.

28. In its September 1999 letter, OCRM outlined several changes that, if performed, would bring the site into compliance with the Coastal Zone Management Program. These changes included providing a buffer area, redirecting stormwater runoff, and purchasing credits in an off-site mitigation bank. These changes clearly reflect OCRM's consideration of the ten guidelines in the Program Document as well as the general mandate to balance preservation of natural resources and economic improvement of the citizens of the State. These changes would "protect and . . . restore . . . the resources of the state's coastal zone" [S.C. Code Ann. § 48-39-30(B)(2) (Supp. 1999)] by ensuring, through these recommendations, that the wetlands are not depleted further as a result of the building of the medical facility. The proposed mitigation plan is consistent with the general guidelines set forth in the Program Document. A permit granted under the proposed mitigation plan will ensure that stormwater runoff will be redirected to preserve and possibly increase the size of the wetlands currently on the land, which serves to maintain and improve water quality, as well as meeting existing State requirements for waste discharges. The OCRM staff has attempted with the proposed mitigation plan to protect the remaining wetlands in a more effective manner than was attempted previously. Moreover, the general character of the area involves a mixture of professional buildings and residential homes. For these reasons, I conclude that OCRM has properly considered the guidelines set forth in the Coastal Zone Management Program Document in formulating its proposed mitigation plan, as modified during the hearing.

29. The project, as revised by OCRM, does not require fill or other significant permanent alteration of wetlands as contemplated by Chapter III, Section IV(1)(b) and Section XII(E) of the Coastal Zone Management Program Document. (3) An engineer with OCRM determined that the conditions set forth as part of the modified mitigation plan would minimize the impact the project would have on the remaining wetlands on the Property.

30. OCRM must also consider the "cumulative impacts of the commercial activity which exists or is likely to exist in the area." Coastal Management Program Document, Chapter III, Section IV(1)(b). OCRM's proposed plan would not only minimize the effect on the wetlands, it may even increase the size of the wetlands. The proposed mitigation plan also requires HLP to provide up to $20,000 worth of credits to a mitigation bank. Also, the public will derive the benefit of the restoration of a previously degraded area and long-term preservation of that area.

31. After considering the facts and the applicable law, I conclude that OCRM properly imposed the requirements in the proposed mitigation plan as a prerequisite to approval of HLP's stormwater permit application.

32. Pursuant to ALJD Rule 29(C), issues raised in the proceedings but not addressed in this Order are deemed denied.



ORDER

IT IS THEREFORE ORDERED that OCRM continue to process the application of Hospital Land Partners for a stormwater management permit and coastal zone consistency certification. Hospital Land Partners is ordered to submit a stormwater management plan

which incorporates Items One through Five of OCRM's September, 1999 letter. The permit

shall be neither granted nor denied until Hospital Land Partners has submitted, in a timely fashion, the revised stormwater management plan for OCRM's evaluation.





______________________________

C. DUKES SCOTT

ADMINISTRATIVE LAW JUDGE



August ____, 2000

Columbia, South Carolina

1. For example, the September 27, 1999 letter setting forth the requirements imposed for approval of the stormwater management plan indicates that "[a] planting schedule needs to be part of the resubmittal package." (emphasis added).

2. While the statutes governing critical area permits specifically require OCRM to consider the "value and enjoyment of adjacent owners," there is no corresponding provision for non-critical areas in the coastal zone. See S.C. Code Ann. § 48-39-150(A)(10) (Supp. 1999)

3. Section IV(1)(b) provides that OCRM must deny a permit for commercial proposals which require permanent alteration of wetlands unless "no feasible alternatives exist and the facility is water dependent." Section XII(E) states that project proposals requiring fill or other significant permanent alteration of a freshwater marsh will not be approved unless no feasible alternative exists or an overriding public interest can be demonstrated, and any substantial environmental impact can be minimized.


Brown Bldg.

 

 

 

 

 

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