House File 2744 - Introduced HOUSE FILE BY COMMITTEE ON AGRICULTURE (SUCCESSOR TO HSB 736) Passed House, Date Passed Senate, Date Vote: Ayes Nays Vote: Ayes Nays Approved A BILL FOR 1 An Act precluding certain enforcement actions by the department 2 of natural resources or the attorney general based on 3 detrimental reliance. 4 BE IT ENACTED BY THE GENERAL ASSEMBLY OF THE STATE OF IOWA: 5 TLSB 6140HV 81 6 da/gg/14 PAG LIN 1 1 Section 1. Section 455B.109, Code Supplement 2005, is 1 2 amended by adding the following new subsection: 1 3 NEW SUBSECTION. 6. The department is precluded from 1 4 taking an enforcement action against a person for failing to 1 5 comply with a requirement if the person has detrimentally 1 6 relied upon the department's binding explanation of the 1 7 requirement as provided in section 455B.110. 1 8 Sec. 2. NEW SECTION. 455B.110 ENFORCEMENT ACTION == 1 9 PRECLUSION BASED ON DETRIMENTAL RELIANCE. 1 10 1. As used in this section, unless the context otherwise 1 11 requires: 1 12 a. "Department representative" means an official or 1 13 employee of the department or an agent of the department, 1 14 including a contractor who holds themselves out as acting on 1 15 behalf of the department. 1 16 b. "Enforcement action" means any of the following: 1 17 (1) For the department, issuing an order, initiating or 1 18 acting as a party in a contested case proceeding, or rendering 1 19 a proposed or final decision as provided in chapter 17A, for 1 20 purposes of imposing, assessing, or collecting a civil penalty 1 21 under section 455B.109 or 455B.191. 1 22 (2) For the attorney general, bringing a judicial 1 23 proceeding, or acting as a party in a judicial proceeding, 1 24 including a civil or criminal action, to the extent authorized 1 25 by section 455B.112, 455B.146, 455B.146A, or 455B.191. 1 26 2. a. The department is precluded from taking an 1 27 enforcement action to impose, assess, or collect a civil 1 28 penalty against a person who has detrimentally relied upon a 1 29 binding explanation by the department which erroneously 1 30 advises the person how to comply with a requirement of a 1 31 statute or departmental rule, including by performing or 1 32 refraining from performing an act. 1 33 b. The attorney general is precluded from taking an 1 34 enforcement action to obtain a criminal judgment or impose, 1 35 assess, or collect a civil penalty against a person who has 2 1 detrimentally relied upon a binding explanation by the 2 2 department as provided in paragraph "a". 2 3 3. The department's explanation may be provided to a 2 4 person who may have violated this chapter in writing or 2 5 verbally by a departmental representative. If the 2 6 department's explanation is provided in writing, it shall be a 2 7 binding explanation. If the department's explanation is 2 8 provided verbally, it shall become binding as follows: 2 9 a. The person must deliver a request for confirmation to 2 10 the department at an address established by the department for 2 11 the purpose of receiving requests for confirmation. The 2 12 person's request for confirmation must be in writing and 2 13 delivered to the department within twenty=one business days 2 14 after the department's explanation was verbally provided to 2 15 the person. The person's request for confirmation must 2 16 include all of the following: 2 17 (1) A return address for the department to deliver a 2 18 response to the person. 2 19 (2) The explanation sought to be confirmed. 2 20 (3) The date that the department's explanation was 2 21 provided. 2 22 (4) The name of the department representative who provided 2 23 the explanation. 2 24 b. The department may deliver a response to the person's 2 25 return address as provided in the request for confirmation. 2 26 The department's response shall do one of the following: 2 27 (1) Confirm that the department's explanation provided 2 28 verbally to the person is binding. The department may deliver 2 29 the response to the person at any time. 2 30 (2) Deny that the department's explanation is binding. 2 31 The department may include a binding explanation in writing. 2 32 The department's response must be delivered to the person 2 33 within thirty days after the person delivers the request for 2 34 confirmation to the department. If the department fails to 2 35 deliver a timely response to the person, the explanation 3 1 sought to be confirmed by the person as provided in the 3 2 person's request for confirmation shall be the binding 3 3 explanation. 3 4 4. The department's explanation, the person's request for 3 5 confirmation, and the department's response may be transmitted 3 6 in an electronic format, including but not limited to the 3 7 internet, and shall be deemed written. 3 8 5. a. If a binding explanation concerns a requirement 3 9 subject to a variance as provided in section 455B.143, or 3 10 otherwise as a waiver or variance as provided in section 3 11 17A.9A, the binding explanation shall be deemed to be a waiver 3 12 or variance as provided in those sections. 3 13 b. If a binding explanation concerns a requirement that is 3 14 not subject to a variance or waiver as provided in section 3 15 455B.143 or 17A.9A, the department shall deliver a notice to 3 16 the person who has been precluded from being subjected to an 3 17 enforcement action. The notice shall provide that the person 3 18 may be subject to an enforcement action on or after a future 3 19 date. The department shall establish a future date which 3 20 allows the person a reasonable period to comply with the 3 21 requirement. However, the department shall not nullify a 3 22 binding explanation if it would result in undue hardship to 3 23 the person including but not limited to requiring the person 3 24 to move, demolish, or rebuild a structure which was 3 25 constructed or expanded in reliance on the department's 3 26 binding explanation. The department's notice shall inform the 3 27 person that the person may object to the department's 3 28 determination that compliance does not result in undue 3 29 hardship to the person. The person may object to the 3 30 department's determination by delivering a written request for 3 31 a hearing to the department. The person shall deliver the 3 32 request for a hearing within twenty=one business days after 3 33 the department delivered its notice to the person. The 3 34 department shall commence a contested case proceeding 3 35 regarding the issue in the same manner as provided in chapter 4 1 17A. An interpretation of the issue is not vested in the 4 2 discretion of the department, and is subject to de novo 4 3 judicial review in any subsequent review proceeding of the 4 4 case as provided in section 17A.19. 4 5 6. The department or attorney general may take an 4 6 enforcement action against a person regardless of a binding 4 7 explanation if any of the following applies: 4 8 a. The person obtains the binding explanation in bad 4 9 faith, having actual knowledge that the explanation was 4 10 erroneous. 4 11 b. The binding explanation concerns a requirement in a 4 12 statute or departmental rule that has been superseded by a 4 13 requirement in a statute enacted or rule adopted after the 4 14 explanation becomes binding. 4 15 7. Nothing in this section prevents the department from 4 16 conducting an investigation or issuing a subpoena requiring 4 17 the attendance of a witness or the production of evidence 4 18 pertinent to a hearing. 4 19 Sec. 3. Section 455B.112, Code Supplement 2005, is amended 4 20 to read as follows: 4 21 455B.112 ACTIONS BY ATTORNEY GENERAL. 4 22 1. In addition to the duty to commence legal proceedings 4 23 at the request of the director or commission under this 4 24 chapter; chapter 459, subchapters I, II, III, IV, and VI; or 4 25 chapter 459A, the attorney general may institute civil or 4 26 criminal proceedings, including an action for injunction, to 4 27 enforce the provisions of this chapter; chapter 459, 4 28 subchapters I, II, III, IV, and VI; or chapter 459A, including 4 29 orders or permits issued or rules adopted under this chapter; 4 30 chapter 459, subchapters I, II, III, IV, and VI; or chapter 4 31 459A. 4 32 2. However, the attorney general is precluded from taking 4 33 an enforcement action against a person for failing to comply 4 34 with a requirement if the person has detrimentally relied upon 4 35 the department's binding explanation of the requirement as 5 1 provided in section 455B.110. 5 2 Sec. 4. Section 455B.146, Code 2005, is amended to read as 5 3 follows: 5 4 455B.146 CIVIL ACTION FOR COMPLIANCE == LOCAL PROGRAM 5 5 ACTIONS. 5 6 1. If any order, permit, or rule of the department is 5 7 being violated, the attorney general shall, at the request of 5 8 the department or the director, institute a civil action in 5 9 any district court for injunctive relief to prevent any 5 10 further violation of the order, permit, or rule, or for the 5 11 assessment of a civil penalty as determined by the court, not 5 12 to exceed ten thousand dollars per day for each day such 5 13 violation continues, or both such injunctive relief and civil 5 14 penalty. 5 15 2. However, the attorney general is precluded from taking 5 16 an enforcement action against a person for failing to comply 5 17 with a requirement if the person has detrimentally relied upon 5 18 the department's binding explanation of the requirement as 5 19 provided in section 455B.110. 5 20 3. Notwithstanding sections 331.302 and 331.307, a city or 5 21 county which maintains air pollution control programs 5 22 authorized by certificate of acceptance under this division 5 23 may provide civil penalties consistent with the amount 5 24 established for such penalties under this division. 5 25 Sec. 5. Section 455B.146A, Code 2005, is amended by adding 5 26 the following new subsection: 5 27 NEW SUBSECTION. 6. The attorney general is precluded from 5 28 taking an enforcement action against a person for failing to 5 29 comply with a requirement if the person has detrimentally 5 30 relied upon the department's binding explanation of the 5 31 requirement as provided in section 455B.110. 5 32 Sec. 6. Section 455B.191, Code 2005, is amended by adding 5 33 the following new subsection: 5 34 NEW SUBSECTION. 7. The department or the attorney general 5 35 is precluded from taking an enforcement action against a 6 1 person for failing to comply with a requirement if the person 6 2 has detrimentally relied upon the department's binding 6 3 explanation of the requirement as provided in section 6 4 455B.110. 6 5 EXPLANATION 6 6 This bill amends the first three divisions of Code chapter 6 7 455B, which provides authority to the department of natural 6 8 resources and in some cases the attorney general to bring an 6 9 enforcement action against persons who violate provisions 6 10 regulating environmental quality (air and water quality). 6 11 BACKGROUND. Division I of Code chapter 455B provides the 6 12 department with general regulatory authority. The department 6 13 may establish a range of civil penalties for violations of the 6 14 Code chapter (Code section 455B.109). The attorney general is 6 15 authorized to institute civil or criminal judicial proceedings 6 16 necessary to enforce provisions of the Code chapter (Code 6 17 section 455B.112). 6 18 Division II of Code chapter 455B regulates air quality. 6 19 The attorney general at the request of the department may 6 20 institute a civil action in court to obtain injunctive relief 6 21 or impose a civil penalty of up to $10,000 for a violation of 6 22 the division (Code section 455B.146). A person who knowingly 6 23 violates any provision of the division is guilty of an 6 24 aggravated misdemeanor (Code section 455B.146A). An 6 25 aggravated misdemeanor is punishable by confinement for not 6 26 more than two years and a fine of at least $500 but not more 6 27 than $5,000. A conviction for a subsequent violation is 6 28 punishable by imprisonment for not more than four years and a 6 29 fine of not more than $20,000 (Code section 455B.146A). 6 30 Division III of Code chapter 455B regulates water quality. 6 31 Generally, a person who violates a provision of the division 6 32 is subject to a civil penalty of not more than $5,000 (Code 6 33 section 455B.191). The Code section does not expressly 6 34 provide whether the department or the attorney general may 6 35 enforce the provision. 7 1 The department and the attorney general are required to 7 2 enforce the provisions of Code chapter 459 regulating animal 7 3 feeding operations and specifically confinement feeding 7 4 operations and open feedlot operations in the same manner as 7 5 provided in Code chapter 455B, division I (Code sections 7 6 459.103 and 459A.501). A person who violates an air quality 7 7 standard in Code chapter 459 is subject to a civil penalty 7 8 which is established, assessed, and collected in the same 7 9 manner as provided in Code section 455B.109. A person who 7 10 violates a water quality regulation which applies to a 7 11 confinement feeding operation or open feedlot operation is 7 12 subject to a civil penalty which is established, assessed, and 7 13 collected in the same manner as provided in Code section 7 14 455B.191. There are increased civil penalties for persons 7 15 classified as habitual violators which may be up to $25,000 7 16 (Code section 459.604). 7 17 BILL'S PROVISIONS. The bill relates enforcement actions 7 18 brought and carried out by the department or the attorney 7 19 general under the provisions described herein. The bill 7 20 provides that the department is precluded from taking an 7 21 enforcement action to impose, assess, or collect a civil 7 22 penalty against a person who has detrimentally relied upon a 7 23 binding explanation by the department which erroneously 7 24 advises the person how to comply with a requirement of a 7 25 statute or departmental rule, including by performing or 7 26 refraining from performing an act. The bill provides that the 7 27 attorney general is precluded from taking an enforcement 7 28 action to obtain a criminal judgment or impose, assess, or 7 29 collect a civil penalty against a person who has detrimentally 7 30 relied upon such a binding explanation by the department. 7 31 In order to be binding, the department's explanation must 7 32 be in writing. If the department's explanation is made 7 33 verbally, it may become binding if the department confirms the 7 34 earlier verbal explanation as requested by the person who 7 35 would benefit from the confirmation. If the department does 8 1 not confirm the earlier verbal explanation or issue a new 8 2 written and binding explanation, the binding explanation is 8 3 that version contained in the person's request for 8 4 confirmation. The binding explanation may be treated as a 8 5 waiver or variance (see Code sections 17A.9A and 455B.143). 8 6 Otherwise, the department must deliver a notice to the person 8 7 stating that the requirement will become applicable on a 8 8 future date, unless the department determines that this would 8 9 result in undue hardship on the person who has relied upon the 8 10 binding explanation. The person may object to the 8 11 department's determination. An objection triggers a hearing 8 12 which must be conducted in the same manner as a contested case 8 13 proceeding under Code chapter 17A. A binding explanation does 8 14 not apply if the person obtained it in bad faith or a later 8 15 enacted statute or adopted rule supersedes it. 8 16 LSB 6140HV 81 8 17 da:nh/gg/14.1