Van Buren (Town of) - Ruling, January 19, 1993
Ruling, January 19, 1993
STATE OF NEW YORK : DEPARTMENT OF ENVIRONMENTAL CONSERVATION
In the Matter of the Application of the
TOWN OF VAN BUREN,
on behalf of the
PARTY STATUS
SENECA WATER DISTRICT,
AND
ISSUES
for a permit for approval of the acquisition of a new source of water supply
to replace its existing source of water supply, pursuant to Environmental Conservation Law
Article 15, Title 15 (Water Supply), and Title 6 of the Official Compilation of Codes, Rules and Regulations
of the State of New York Part 601 (Water Supply Applications).
Water Supply Application No. 8882;
Application I.D. No. 7-3156-00042/1-0
RULINGS
Introduction
On December 22, 1992 at 7:00 p.m., a legislative hearing was held before Administrative Law Judge ("ALJ") Kevin J. Casutto, at the Van Buren Town Hall, 7575 Van Buren Road, Baldwinsville, New York. An issues conference was held on December 23, 1992, at 10:00 a.m., at the same location. The stenographic record of the proceedings was received by the ALJ on January 7, 1993.
The Applicant appeared by Jan S. Kublick, Esq., Davoli, McMahon & Kublick, 500 South Salina Street, Syracuse, New York 13202. Appearing with counsel were Norma Johnston, Town Water Board, and Lawrence Roscini, President, LJR Engineers.
The Department Staff ("Staff") appeared by Thomas Fucillo, Esq., Regional Attorney, New York State Department of Environmental Conservation ("NYSDEC") Region 7. Appearing with counsel was Joanne March, Senior Environmental Analyst, NYSDEC Region 7, Division of Regulatory Affairs.
The Village of Baldwinsville (the "Village") appeared by J. C. Engelbrecht, Esq., Village of Baldwinsville Attorney, Suite 824, University Building, 120 East Washington Street, Syracuse, New York. Appearing with counsel was William Rowell, Village Engineer.
Background
The Applicant and the Village were parties to a 30 year contract which required the Village to provide a water supply to the Applicant from its well water source. In return, the Village received payment from the Applicant for the Applicant's usage of water. There is no dispute that this contract expired approximately three years ago. During the life of that contract, the Village incurred indebtedness necessary to improve and/or maintain its water supply system, thereby assuring an adequate supply of water to its customers, including the Applicant. The Village has continued to provide water to the Applicant, since the expiration of the contract, and the Applicant has continued to pay the Village for its water usage. The Village seeks to recoup $243,144.00, one-third of its outstanding indebtedness, from the Applicant because the Applicant historically utilized approximately one-third of the Village's water supply.
Applicant has filed the present application, seeking authorization to acquire a new source of water supply from the Onondaga County Water Authority (OCWA) to replace the existing source of supply from the Village of Baldwinsville, through a proposed connection of the existing Town water distribution system to the existing OCWA distribution system. The Applicant deems the OCWA supply to be a better quality source of water supply, since it contains lower concentrations of minerals than does the Village's groundwater source. The Applicant's water distribution system currently has two connections to the OCWA distribution system. Those connections have been used to supplement water to the District in the past, when the Village supply has been unable to meet demand. Actual water usage in the District is estimated at one hundred thousand gallons per day. Even though the permit application is for one million gallons per day ("MGD"), to allow for anticipated growth, the OCWA supply has more than adequate capacity to meet the Applicant 's requirements, because OCWA's sources include Lake Ontario. Staff has approved this permit application to take one MGD, and has prepared a draft permit which would authorize the Applicant to proceed with acquisition of this new source of water supply from OCWA.
The Village applied for party status in this proceeding by filing a letter dated December 15, 1992 by its Mayor, Jean Wells. That letter identifies as the Village's primary issue, that the Applicant should be responsible for reimbursement to the Village for $243,144.00 of outstanding bonded indebtedness which the Village incurred for the benefit of the Seneca Water District.
At the issues conference, the Village proposed four issues for adjudication:
- Proportional reimbursement for outstanding indebtedness which it incurred during the life of the contract in order to meet its obligation to provide a source of water supply to the Applicant;
- Transfer of ownership from the Applicant to the Village, of the right-of-way of a 10 inch water main which runs between the Village connection and Morgan Road;
- Purchase by the Applicant of pump monitoring equipment, which the Village owns and which is necessary to the continued provision of water to the Applicant, regardless of supplier; and
- That a crossover connection between the Village and Applicant water distribution systems be preserved, to assure availability of emergency water service to each municipality.
Discussion
The Village bases its request for reimbursement of indebtedness upon the regulatory authority of 6 NYCRR 601.6(b)(6). This regulatory provision states that prior to issuing a permit, the Department must determine that the proposed project is just and equitable to all affected municipalities and their inhabitants and in particular with regard to present and future needs for sources of water supply. The Village also relies upon a legal theory of equitable contract, asserting that improvements to its water supply system (and the resultant indebtedness) undertaken by the Village during the life of the contract were intended to extend beyond the life of the contract. The Village asserts that the Applicant should be held responsible for its portion of this debt, proportional to Applicant's historic water usage, in the event Applicant changes its source of water supply.
Applicant and Staff, however, assert that the proposed project is neither unjust nor inequitable to the Village, because the Village was fully compensated under the terms of the contract for any and all indebtedness which it unilaterally incurred in order to meet its obligations under the contract. They assert that since the contract has expired, no further obligation exists between the Village and the Applicant. As has been pointed out by Applicant and Staff, should the Village wish to pursue its equitable contract claim, it may pursue such a civil remedy in the court system. Furthermore, Applicant and Staff assert that the proposed project is just and equitable to the Village because the Village will no longer be providing a water supply to the Applicant; therefore, the Village's future water supply is better assured, because it will now have a greater excess supply.
The Village has failed to relate its first and primary issue, compensation for indebtedness which it incurred, to any environmental or water supply requirement. This issue is economic, i.e., one of lost revenue; and possibly, also an issue of contract interpretation. The Village has not demonstrated any inequities to the affected municipalities and their inhabitants, particularly regarding their present and future needs for sources of water supply. Therefore, I find that the sixth factor set forth in 6 NYCRR 601.6(b) has been satisfied by the Town of Van Buren's application.
Concerning the three other issues proposed by the Village, the Applicant has stated that without seeking any consideration in return, it is prepared to convey to the Village, whatever interest Applicant may have in the right-of-way and the pipe. The Applicant acknowledges that monitoring equipment will continue to be necessary, and it will either purchase the existing equipment from the Village or else purchase comparable equipment. By mutual agreement between Applicant and Staff, a revised draft permit (designated by Staff as "Draft Permit #2", and dated December 28, 1992; marked Exhibit 3) has been prepared, that contains a new special condition #18, which addresses the necessity for such monitoring equipment. I find this to be a minor modification to the existing draft permit. Lastly, as described above, the existing connection between the two water distribution systems will remain in place and will not be altered, except for the fact that the valve will be closed. Therefore, it will serve as an emergency crossover connection. Accordingly, these matters have either already been resolved or do not present issues which would result in a denial or substantial modification of the permit.
The six other factors set forth in 6 NYCRR 601.6(b) are:
- that the proposed project is justified by the public necessity;
- that the applicant properly considered other sources of water supply that are or may become available;
- that all work and construction connected with the project will be proper and safe;
- that the water supply will be adequate to meet the needs of the proposed service area;
- that there will be proper protection and treatment of the water supply and watershed;
- that there is provision for fair and equitable determinations of and payments of any direct and indirect legal damages to persons or property resulting from the acquisition of any lands in connection with the proposed project or from the execution of the proposed project.
No issues have been raised with respect to these six factors.
Lastly, Staff has reviewed the factors set forth in 6 NYCRR 601(6)(b) with respect to the present permit application, and has determined the requirements of that regulatory provision have been satisfied.
Rulings
Although the Village of Baldwinsville has identified economic interests resulting from the proposed project, it has failed to relate those interests to any statutory or regulatory provision which governs issuance of the requested water supply permit to the Town of Van Buren. Nor has the Village met its burden of identifying an adjudicable issue, i.e., an issue which would result in permit denial or significant modification of any permit condition. Therefore, party status is denied to the Village.
Lastly, I find that the seven factors set forth in 6 NYCRR 601.6(b) have been satisfied with respect to the permit application of the Town of Van Buren (on behalf of the Seneca Water District). Staff is directed to issue draft permit #2, dated December 28, 1992, to the Applicant.
Appeals
Pursuant to 6 NYCRR 624.4(f) and 624.6(d), these Rulings on party status and issues may be appealed in writing to the Commissioner within three business days of receipt of the Rulings. However, I am extending the time period for filing such appeals to January 28, 1993. Reply briefs to any such appeals must be filed by February 4, 1993. Any appeals and replies must be addressed to the office of Commissioner Thomas C. Jorling, NYSDEC, Room 604, 50 Wolf Road, Albany, New York 12233-5500, and must be received by that office by the dates indicated herein. A copy of all such appeals, briefs and related filings must also be sent to my attention at the Department's Office of Hearings, and to the other parties and party applicant, at the addresses indicated below. Transmittal of documents shall be made in the same manner to all persons.
/s/
Kevin J. Casutto
Administrative Law Judge
January 19, 1993
Albany, New York
TO: Jan S. Kublick, Esq.
Davoli, McMahon & Kublick, P.C.
Attorneys at Law
500 South Salina Street
Syracuse, New York 13202
Thomas Fucillo, Esq.
Regional Attorney
NYSDEC REGION 7
615 Erie Boulevard West
Syracuse, New York 13204
J.C. Engelbrecht, Esq.
University Building, Suite 824
120 East Washington Street
Syracuse, New York 13202
