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:
Converse Power Corporation vs. SCDHEC

AGENCY:
South Carolina Department of Health and Environmental Control

PARTIES:
Petitioner:
Converse Power Corporation

Respondent:
South Carolina Department of Health and Environmental Control
 
DOCKET NUMBER:
98-ALJ-07-0032-CC

APPEARANCES:
E.D. Sloan, Jr., pro se, Petitioner

Samuel L. Finklea, III, Attorney for Respondent
 

ORDERS:

FINAL ORDER AND DECISION

This matter comes before me pursuant to S.C. Code Ann. § 1-23-310, et seq. (1986 & Supp. 1997) and 25 S.C. Code Ann. Regs. 61-72 (Supp. 1997) upon Petitioner Converse Power Corporation's ("Converse") request for a contested case hearing. Petitioner applied for an aquaculture permit from the South Carolina Department of Health and Environmental Control ("DHEC") on May 30, 1997, for the operation of a proposed shellfish cultivation facility. DHEC issued a staff decision denying the permit on April 24, 1998. After notice to the parties, a hearing was conducted on May 12, 1998, at the Administrative Law Judge Division ("ALJD") in Columbia, South Carolina. Based on the relevant and probative evidence and applicable law, Petitioner's application for an aquaculture permit is denied.

STATEMENT OF THE CASE

Petitioner applied for an aquaculture permit from DHEC on May 30, 1997, and amended that application on July 31, and November 21, 1997. DHEC repeatedly informed Petitioner that he needed to submit more specific information concerning operational plans for the facility as required by 24A S.C. Code Ann. Regs. 61-47.O.1(d) (Supp. 1997) and that DHEC would inspect the aquaculture operation prior to issuance of the permit. Because DHEC was unable to determine if Petitioner's shellfish cultivation facility and operation would perform in a manner which produces shellfish safe for human consumption, DHEC staff denied Petitioner's permit on April 24, 1998.

Petitioner mailed a letter of application to DHEC on May 30, 1997, providing a general outline of his plans for a proposed shellfish operation. Alleging that DHEC "acted arbitrarily, capriciously, and/or unreasonably in not acting upon, or even acknowledging the application" for an aquaculture permit, Petitioner requested a contested case hearing on July 18, 1997. DHEC filed a Motion to Dismiss on July 28, 1997, citing the ALJD's lack of subject matter jurisdiction because Petitioner had not exhausted pre-hearing administrative remedies. Petitioner supplemented his application letter of May 30, 1997, with a completed form "Application for SCDHEC Shellfish Program Permits and Certificates" on July 31, 1997. DHEC's motion to dismiss was granted on September 3, 1997 (Converse Power Co. v. S.C. Dep't of Health and Envtl. Control, Docket No. 97-ALJ-07-0435-CC), and the matter was dismissed without prejudice.

Seeking an order to compel DHEC to render a final agency decision concerning his application, Petitioner then filed a petition for mandamus with the ALJD on September 24, 1997. In an order dated November 14, 1997 (Converse Power Corp. v. S.C. Dep't of Health and Envtl. Control, Docket No. 97-ALJ-07-0588-CC), Judge Alison Lee ordered DHEC to respond to Petitioner's letter of August 30, 1997 which challenged DHEC's assertion that the submitted application was deficient. Petitioner wrote DHEC on November 21, 1997 with general statements intended to additionally supplement the May 30, 1997 application.

On January 1, 1998, Petitioner instituted the present action by filing a new Petition for Administrative Review, citing DHEC's inaction on his application for an aquaculture permit. A telephone conference was held when DHEC failed to appear at the scheduled hearing on April 22, 1998, and DHEC consented to file an agency decision regarding Petitioner's application. DHEC formally denied the permit on April 24, 1998, citing its inability to perform an inspection as required by 24A S.C. Code Regs. 61-47.G.2(b) (Supp. 1997). Petitioner amended his Petition for Administrative Review on April 25, 1998, contending that DHEC's denial was unlawful and seeking an order granting the permit. A contested case hearing on the merits followed on May 12, 1998.

DISCUSSION

The facts in this case are largely undisputed. The outcome of this matter hinges upon a legal interpretation of the applicable regulations. The parties agree that R. 61-47 is the controlling regulation, but they assert conflicting interpretations. Petitioner claims that he has met all statutory and regulatory requirements necessary for issuance of an aquaculture permit. DHEC insists that Petitioner's facility must be constructed and inspected prior to issuance of a permit and that his application is incomplete.

S.C. Code Ann. § 44-1-140 (1985) authorizes DHEC to promulgate sanitation regulations for the harvesting, storing, processing, handling, and transportation of molluscan shellfish. The primary purpose of R. 61-47 that governs the issuance of an aquaculture permit is to protect the health of the ultimate consumer of shellfish cultivated at an aquaculture facility.(1) Protection of the health of shellfish consumers in R. 61-47 is consistent with the Interstate Shellfish Sanitation Program Model Code and Guidelines, but is more specific to aquaculture facilities and operations. DHEC's powers are construed liberally when the powers concern the protection of the health and welfare of the public. City of Columbia v. Board of Health and Environmental Control, 292 S.C. 199, 355 S.E.2d 536 (1987).

An aquaculture permit must not be granted unless an applicant can establish that his proposed shellfish cultivation facility and operation will perform in a manner that will cultivate, harvest, store, process, handle, and transport shellfish that are safe for human consumption. Therefore, DHEC necessarily must have the ability to review detailed operational plans and examine the aquaculture operation prior to permitting a facility. The application and permitting process is flexible so that an applicant and DHEC can continuously communicate with each other to share information and to alter or amend the application as may be necessary to obtain compliance with R. 61-47. This process is dependent upon the applicant providing DHEC with detailed plans against which DHEC may base an inspection.

Regulation 61-47.O.1(b) provides that an aquaculture permit must be obtained by "[a]ny person operating a land-based aquaculture facility which grows or produces molluscan shellfish for sale . . . prior to commencing operation or harvesting shellfish for human consumption." Regulation 61-47.O.1(d) requires applications for aquaculture permits to "contain a written operational plan detailing the scope and extent of the operation." Not only does Petitioner's application lack a written operational plan, but also no operational plan exists.

Petitioner's application also fails to meet the requirements of R. 61-47.0.4 (d) for a land based aquaculture permit. Regulation 61-47.0.4 (d) sets forth eleven items to be addressed in an application, including: a description of the design and activities of the proposed facility; the specific site and boundaries in which the shellfish culture activities will be conducted; details about the types of equipment to be used in the operation and the species of shellfish to be cultivated; and procedures for sanitation and maintenance of water quality. Petitioner failed to adequately address almost every requirement. For instance, Petitioner's application does not contain a description of the design and activities of the proposed aquaculture facility. No design plans exist for the proposed aquaculture facility and the only description of the site and boundaries in which the shellfish culture activities will be conducted is the street address of the location. No information related to the types and locations of any structures or equipment to be utilized in the proposed aquaculture operation is included. Despite these obvious omissions, Petitioner refuses to offer any further information related to the proposed aquaculture facility and operation and adamantly insists that the application is complete.

Not only has Petitioner submitted an incomplete application, but also the physical facilities of the proposed operation are presently inadequate. Regulation 61-47.G.2(b) provides that DHEC "shall make inspections of the shellfish operation as may be necessary to determine compliance with the applicable provisions of this [r]egulation." To date, Petitioner has not constructed any aquaculture facilities for cultivation of shellfish at the proposed site. Inspection of the proposed operation is impossible until the proposed facility is constructed and functioning. While Petitioner argues that construction of the facility is not required prior to issuance of the permit, the regulation contemplates observation of an ongoing operation.(2) There can be no ongoing operation unless and until the facility is constructed and in a functional state.

Petitioner refuses to provide sufficient documentation or physical exhibition of the intricacies of the proposed shellfish cultivation facility and operation. Petitioner seeks permission to engage in an activity with important public health implications without first defining the scope and method of the operation or demonstrating the safety of the process. Without the ability to review and consider a written operation plan and/or the ability to physically inspect the proposed operation, there is no basis upon which to determine whether the proposed shellfish cultivation facility and operation will perform in a manner which produces shellfish safe for human consumption. The application file submitted by Petitioner to DHEC and the record of the contested case proceedings before the ALJD are insufficient to make a determination as to whether Petitioner's proposed shellfish operation will perform in a manner which produces shellfish safe for human consumption.

For the foregoing reasons, Petitioner's application for an aquaculture permit is denied.

FINDINGS OF FACT

By a preponderance of the evidence, I make the following findings of fact:

  1. Petitioner E.D. Sloan, Jr., President of Converse, submitted a letter of application for an aquaculture permit to DHEC on May 30, 1997, providing a general outline of plans for a proposed shellfish operation facility at 130 Venture Boulevard, Spartanburg, South Carolina.
  2. Alleging that DHEC "acted arbitrarily, capriciously, and/or unreasonably in not acting upon, or even acknowledging the application" for an aquaculture permit, Petitioner requested a contested case hearing on July 18, 1997.
  3. DHEC filed a motion to dismiss on July 28, 1997, based on the Administrative Law Judge Division's ("Division") lack of subject matter jurisdiction. DHEC's motion to dismiss was granted on September 3, 1997 (Converse Power Co. v. S.C. Dep't of Health and Envtl. Control, Docket No. 97-ALJ-07-0435-CC), and the matter was dismissed without prejudice.
  4. Petitioner supplemented his application letter of May 30, 1997, with a completed form "Application for SCDHEC Shellfish Program Permits and Certificates" on July 31, 1997.
  5. DHEC asserted that the submitted application was deficient, and refused to render a final agency decision concerning the application. In an order dated November 14, 1997 (Converse Power Corp. v. S.C. Dep't of Health and Envtl. Control, Docket No. 97-ALJ-07-0588-CC), Judge Alison Lee ordered DHEC to respond to Petitioner's letter of August 30, 1998. Petitioner wrote DHEC on November 21, 1997 with general statements intended to additionally supplement the May 30, 1997 application.
  6. Petitioner further supplemented the application by correspondence on November 21, 1997.
  7. The Court takes judicial notice of the two prior orders of the Division relating to the issuance of this permit, Converse Power Co. v. S.C. Dep't of Health and Envtl. Control, Docket No. 97-ALJ-07-0435-CC, and Converse Power Corp. v. S.C. Dep't of Health and Envtl. Control, Docket No. 97-ALJ-07-0588-CC.
  8. By letter dated January 14, 1998, Mr. Michael Coker of DHEC informed Petitioner that the information provided with the application still "lack[ed] specifics and should be further refined prior to permit issuance."
  9. Petitioner failed to provide any further specifics to DHEC regarding operational plans or facility specifications.
  10. DHEC staff denied the permit application on April 24, 1998, citing an inability to perform an inspection of the operation, as required by R. 61-47.G.2(b).
  1. To date, Petitioner has not constructed any aquaculture facilities for cultivation of shellfish at 130 Venture Boulevard, Spartanburg, South Carolina.
  2. Petitioner has never operated an aquaculture facility.
  3. Petitioner's application does not contain a written operational plan.
  4. No operational plan exists for the proposed facility.
  5. Petitioner's application does not contain a description of the design and activities of the proposed aquaculture facility.
  6. No design plans exist for the proposed aquaculture facility.
  7. Petitioner's application does not contain a description of the specific site and boundaries in which the shellfish culture activities will be conducted.
  8. Petitioner's application does not contain any description of the proposed facility except for the street address of the location.
  9. Petitioner's application does not contain any information related to the types and locations of any structures, including pens, cages, nets, tanks, ponds, or floats to be utilized in the proposed aquaculture operation.
  10. Petitioner's application does not contain any description of the species of shellfish to be cultured and harvested at the proposed facility.
  11. Petitioner's application does not contain any description of the source and species of other organisms to be cultured in any polyculture systems.
  12. Petitioner's application does not set forth any procedures to assure that no poisonous or deleterious substances are introduced into the proposed aquaculture activities.
  13. Petitioner's application does not contain a program of sanitation, maintenance, and supervision to prevent contamination of the final shellfish products.
  14. Petitioner's application does not contain any description of the water source of the proposed operation, including the details of any water treatment process or method to be utilized.
  15. Petitioner's application does not set forth a program to maintain water quality control which includes collection of water samples for microbial analysis, temperature and salinity monitoring, and analytical methods used.
  16. Petitioner's application does not contain any description of the method in which shell stock will be harvested, processed if applicable, and sold.
  17. Petitioner refuses to offer any further information related to the proposed aquaculture facility and operation and considers the application complete.
  18. The information provided in Petitioner's application and in the record of the contested case proceedings is insufficient to make a determination as to whether the proposed shellfish cultivation facility and operation will perform in a manner which produces shellfish safe for human consumption.
  19. Inspection of the proposed operation is impossible until the proposed facility has been constructed and is functioning.
  20. Without the ability to review and consider a written operation plan and/or the ability to physically inspect the proposed operation, there is no basis upon which to determine whether the proposed shellfish cultivation facility and operation will perform in a manner which produces shellfish safe for human consumption.


CONCLUSIONS OF LAW

Based upon the foregoing Findings of Fact, I conclude as a matter of law:

  1. The Administrative Law Judge Division has subject matter jurisdiction in this matter pursuant to S.C. Code Ann. § 1-23-310, et seq. (1986 & Supp. 1997) and 25 S.C. Code Ann. Regs. 61-72 (Supp. 1997).
  2. Petitioner, as the moving party, bears the burden of proof and must prove his allegations by the preponderance of evidence standard, the appropriate standard to apply in contested cases in which DHEC is the licensing agency. See National Health Corp. v. DHEC, 298 S.C. 373, 380 S.E.2d 841 (Ct. App. 1989); Anonymous (M-156-90) v. State Bd. of Medical Examiners, 329 S.C. 371, 496 S.E.2d 17 (1998); R. 61-72 § 702(B).
  3. "A court can take judicial notice of its own records, files, and proceedings for all proper purposes including facts established in its records." Freeman v. McBee, 280 S.C. 490, 313 S.E.2d 325 (Ct. App. 1984). Accordingly, judicial notice is taken of the prior proceedings and orders issued in previous cases related to the present permit application. Converse Power Co. v. S.C. Dep't of Health and Envtl. Control, Docket No. 97-ALJ-07-0435-CC; Converse Power Corp. v. S.C. Dep't of Health and Envtl. Control, Docket No. 97-ALJ-07-0588-CC.
  4. Executive powers related to the protection of the health and welfare of the public are to be construed liberally. City of Columbia v. Board of Health and Environmental Control, 292 S.C. 199, 355 S.E.2d 536 (1987).
  5. S.C. Code Ann. § 44-1-140 (1985) authorizes DHEC to promulgate sanitation regulations for the harvesting, storing, processing, handling, and transportation of molluscan shellfish.
  6. Only persons who comply with the requirements of R. 61-47 are entitled to an aquaculture permit.
  7. Regulation 61-47.G.2(b) provides that DHEC "shall make inspections of the shellfish operation as may be necessary to determine compliance with the applicable provisions of this [r]egulation."
  8. Regulation 61-47.O.1(b) provides that an aquaculture permit be obtained by "[a]ny person operating a land-based aquaculture facility which grows or produces molluscan shellfish for sale . . . prior to commencing operation or harvesting shellfish for human consumption" (emphasis added).
  9. Regulation 61-47.O.1(d) requires applications for aquaculture permits to "contain a written operational plan detailing the scope and extent of the operation."
  10. The cardinal rule of statutory construction is that words used in a statute must be given their plain and ordinary meaning without resort to subtle or forced construction to limit or expand the operation of the statute. The language must be read in a sense which harmonizes with its subject matter and accords with its general purpose. Hitachi Data Systems Corp. v. Leatherman, 309 S.C. 174, 420 S.E.2d 843 (1992)
  11. The court's primary function in interpreting a statute is to ascertain the intention of the legislature, and when the terms of a statute are clear and unambiguous, the court must apply them according to their literal meaning. Words used in a statute should be given their plain and ordinary meaning unless something in the statute requires a different interpretation. Further, a statutory provision should be given a reasonable and practical construction consistent with the purpose and policy expressed in the statute. (citations omitted)


First South Sav. Bank, Inc. v. Gold Coast Associates, 301 S.C. 158,390 S.E.2d 486 (S.C.App. 1990).

  1. In construing the plain and ordinary meaning of commonplace words used in a statute, dictionaries and other sources books may be examined. City of Columbia v. Moser, 280 S.C. 134, 311 S.E.2d 920 (1983).
  2. "Operation" means "the process of operating or mode of action; an effect brought about in accordance with a definite plan." Black's Law Dictionary (6th ed. 1990).
  3. The use of the word "operation" in R. 61-47.O.1(b) supports the interpretation that DHEC is responsible for ensuring public health by approving the operational plans, not the construction plans, of shellfish facilities.
  4. Petitioner's application for an aquaculture permit fails to comply with R. 61-47.G.1(e).
  5. Petitioner's application fails to meet the requirements of R. 61-47.0.1(d) for a shellfish aquaculture permit.
  6. Petitioner's application fails to meet the requirements of R. 61-47.0.4 (d) for a land based aquaculture permit.
  7. Petitioner's application is incomplete because it does not include specific, relevant, and necessary information required to be detailed by an applicant seeking an aquaculture permit under R. 61-47.
  8. DHEC is unable to make inspections of the proposed shellfish operation, pursuant to R. 61-47.G.2(b), as is necessary to determine compliance of the operation with the requirements of R. 61-47.
  9. Without the ability to determine whether Petitioner's shellfish cultivation facility and operation will perform in a manner which produces shellfish safe for human consumption, Petitioner's application must be denied.


ORDER

IT IS THEREFORE ORDERED that Petitioner's application for an aquaculture permit is denied.

___________________________________

STEPHEN P. BATES

ADMINISTRATIVE LAW JUDGE



June 15, 1998.

Columbia, South Carolina

980032.wpd

1. Conversely, many other permits issued by DHEC, such as NPDES permits, regulate commercial activities with the primary purpose of protecting the natural resources (e.g. air, land, and/or water) in the area surrounding the site.

2. In construing the plain and ordinary meaning of commonplace words used in a statute, dictionaries and other source books may be examined. City of Columbia v. Moser, 280 S.C. 134, 311 S.E.2d 920 (1983). "Operation" means "the process of operating or mode of action; an effect brought about in accordance with a definite plan." Black's Law Dictionary (6th ed. 1990).


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