Montana Administrative Register Notice 17-319 No. 15   08/11/2011    
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In the matter of the amendment of ARM 17.36.922 and 17.36.924 pertaining to local variances and variance appeals to the department










TO:  All Concerned Persons


1.  On April 14, 2011, the Board of Environmental Review published MAR Notice No. 17-319 regarding a notice of public hearing on the proposed amendment of the above-stated rules at page 528, 2011 Montana Administrative Register, issue number 7.


            2.  The board has amended the rules exactly as proposed.


            3.  The following comments were received and appear with the board's responses:


            COMMENT NO. 1:  Two county boards of health submitted comments in support of the proposed rules.

            RESPONSE:  The board acknowledges the comments.


            COMMENT NO. 2:  One of the new variance criteria in ARM 17.36.922(2) requires the applicant to show that, without a variance, compliance with a requirement would result in undue hardship.  Another criterion requires the applicant to show that no alternatives to a variance are reasonably feasible.  Does the department or board intend to issue guidance about the meaning of the terms "undue hardship" and "reasonably feasible?"

            RESPONSE:  At this time, the board does not plan to further define the terms "undue hardship" and "reasonably feasible."  These terms are intended to provide flexibility to local boards as they evaluate variance requests on a case-by-case basis.


            COMMENT NO. 3:  The variance criteria in ARM 17.36.922(2) should include "Special circumstances must exist that are unique to the applicant's property or situation."

            RESPONSE:  The term "special circumstances" is already addressed in ARM 17.36.922(2)(c), which requires the applicant to show that the variance is necessary to address "extraordinary conditions" that the applicant could not reasonably have prevented.  The requirement that the circumstances be "unique to the applicant's property or situation" is too restrictive.  The term "unique" implies that only one applicant could obtain a variance under a particular set of circumstances, whereas there could be more than one party in the same hardship situation.


            COMMENT NO. 4:  The variance criteria in ARM 17.36.922(2) should include "The need for a variance cannot be the result of an illegal action on the part of the applicant or caused by the applicant's action or inaction."

            RESPONSE:  ARM 17.36.922(2)(c) requires the applicant to show that the variance is necessary to address extraordinary conditions that the applicant could not reasonably have prevented.  In most cases, this criterion would disallow a variance that was the result of an illegal action taken by the applicant.  In general, applicants can reasonably be expected to avoid taking illegal actions.  However, there may be cases where an illegal action would not in itself preclude a variance.  For example, an applicant may have installed a residence in a floodplain based on advice - later found to be erroneous - from the county floodplain office.  When the applicant applies for a variance to install a septic system, the illegality of the home construction might not preclude the variance if the applicant had reasonably relied on the representation of the county floodplain office.  As proposed, ARM 17.36.922(2)(c) will allow counties to consider what the applicant could reasonably have done to avoid the need for a variance.

            The requirement that the need for a variance not be caused by the applicant's "action or inaction" is overbroad.  Every variance situation could be tied to some action or inaction of the applicant.  The criterion in ARM 17.36.922(2)(c) properly focuses on whether the applicant could reasonably have prevented the need for the variance.


            COMMENT NO. 5:  The board should not delete the current ARM 17.36.922(3), which allows local boards of health to adopt variance criteria in addition to those set out in the state rules.  Statutes governing local health boards provide that local sewage regulations must not be "less stringent" than state standards.  The clear intent of the Legislature was to allow local boards of health to adopt and administer rules that go beyond state minimum standards, including variance requirements.  The statutes do not give the board authority to dictate the rules that local boards must use.

            RESPONSE:  Other than setting minimum standards for sewage disposal as required by the Montana Water Quality Act, the Montana Board of Environmental Review (BER) generally cannot dictate to local boards how to regulate sewage.  However, there is an exception for the variance criteria for the state minimum standards.  Section 50-2-116(1)(k), MCA, makes a clear distinction between local sewage standards, which must be "not less stringent than state standards," and local variance criteria, which must be "identical" to state criteria.  By statute, local boards may not use minimum standard variance criteria other than those promulgated by the BER.  The former provision in ARM 17.36.922(3) was deleted because it was in direct conflict with 50-2-116(1)(k), MCA.


            COMMENT NO. 6:  As proposed, the amendments to ARM 17.36.924 allow the department to rehear the original variance request, rather than reviewing the local board decision in an appellate review based on the local record.  What is the authority for this?

            RESPONSE:  Pursuant to 75-5-305(4), MCA, the department variance hearing process is a contested case under the Montana Administrative Procedure Act, Title 2, chapter 4, part 6, MCA (MAPA).  MAPA provides for prehearing discovery, an evidentiary hearing subject to the formal rules of evidence, testimony under oath, and findings of fact and conclusions of law by the department.  These procedures are intended to provide a fact-finding hearing similar to an original proceeding in district court, not an appellate review based solely on the local board records.  The department's final decision may be reviewed by a district court in an appellate proceeding.  Title 2, chapter 4, part 7, MCA.


            COMMENT NO. 7:  The proposed new ARM 17.36.924(6) allows the department to substitute its judgment for that of the local board as to the interpretation and application of the variance criteria in ARM 17.36.922.  What is the authority for this?

            RESPONSE:  In reviewing the local board variance decision, the department may adopt the local board's interpretation of the variance criteria.  However, if the department were strictly bound by the local board's interpretation of the variance criteria, the department could not reach a conclusion different from that of the local board.  The department must have the ability to independently apply the variance criteria in order to implement the statute requiring the department to "grant, conditionally grant, or deny" the requested variance.  Section 75-5-305(4), MCA.


            COMMENT NO. 8:  When the department hears a variance appeal, the proposed new ARM 17.36.924(6) would allow the department to overturn the local board's interpretation of the variance criteria.  But the same rule says that the department will be bound by the local board's interpretation of other local rules.  Does that create a conflict?

            RESPONSE:  There should not be any conflict between these provisions.  Section 75-5-305, MCA, requires the department to hold a hearing on the applicant's variance request and to apply the state variance criteria.  In order to implement that statute, the department must be able to independently interpret the variance criteria and apply them to the circumstances of the applicant's case.  On the other hand, the variance appeal statutes do not give the department authority to overturn a county's interpretation of its substantive rules.  The department must accept the county's determination as to which local substantive rules apply, and how they apply, to the applicant's project.  The department then will apply the variance criteria to determine whether a variance from the substantive rules is appropriate.  If the department decision is appealed to district court, the court would have authority to review the local board's interpretation and application of local substantive rules.


Reviewed by:                                     BOARD OF ENVIRONMENTAL REVIEW




/s/ James M. Madden                          By:  /s/ Joseph W. Russell                                 

JAMES M. MADDEN                                   JOSEPH W. RUSSELL, M.P.H.

Rule Reviewer                                               Chairman


Certified to the Secretary of State, August 1, 2011.


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