July 6, 2015 – The Wisconsin Supreme Court has rejected a claim that new wind energy rules are invalid because the Public Service Commission of Wisconsin (PSC) did not obtain a “housing impact report” before promulgating the new rules.
The Wisconsin Realtors Association, the Wisconsin Builders Association, and the Wisconsin Towns Association were among the plaintiffs who argued that the PSC did not comply with statutory rulemaking procedures in developing the wind energy rules.
Specifically, the plaintiffs argued that Wis. Stat. section 227.115(2) requires state agencies to get a “housing impact report” if any proposed rule “directly or substantially affects the development, construction, cost, or availability of housing” in Wisconsin.
PSC didn’t obtain a housing impact report before promulgating Wis. Admin Code. ch. PSC 128 (Wind Energy Systems), so the new rules are invalid, the plaintiffs argued.
But in Wisconsin Realtors Association v. Public Service Commission of Wisconsin, 2015 WI 63, the supreme court ruled (5-2) that “the governing statutes and the wind energy rules do not demonstrate as a matter of law that the rules directly or substantially affect the development, construction, cost, or availability of housing in this state.”
Writing for the five-justice majority, Justice Shirley Abrahamson also noted that “invalidating Wis. Admin Code ch. PSC 128 under the circumstances presented in the instance case would infringe on the role of the legislature, which we decline to do.”
Rulemaking Process
The PSC, which supervises and regulates public utilities, has statutory authority from the Wisconsin Legislature to regulate the installation or use of wind energy systems, including the requirements and restrictions associated with local wind turbines.
The Legislature also created the Wind Siting Council (Wind Council) to provide research and advice to the PSC on wind system regulation. While researching and advising on the new wind energy rules in 2010, the Wind Council concluded that the siting of wind turbines does not measurably impact the value of properties in the vicinity.
The PSC adopted this conclusion, and the proposed rules were ultimately submitted to the Legislature for approval without any housing impact report.
A Senate Committee returned the proposed rules to PSC, highlighting concerns raised by various parties, including the plaintiffs. But the committee did not specifically ask for a housing impact report. PSC modified the proposed rules and resubmitted them.
The rules took effect a day after the Legislature’s review period ended. Though temporarily suspended by a joint committee, the rules were never repealed and took permanent effect in 2012. Shortly after, the plaintiffs filed their lawsuit against PSC.
Housing Impact Report Not Necessary
The Brown County Circuit Court granted PSC’s motion for summary judgment, concluding that a housing impact report was not required to promulgate the rules.
An appeals court affirmed, noting that the Wind Council and PSC determined that wind energy systems do not substantially affect nearby property values.
On appeal to the supreme court, the majority affirmed, concluding that the wind energy rules were promulgated in compliance with statutory rulemaking procedures.
The majority rejected the plaintiffs’ argument that any and all wind energy rules have the potential to impact property values and therefore a housing report is always required.
“The statute uses the phrase ‘directly or substantially,’ which demonstrates that not just any effect will trigger the housing impact report requirement,” Abrahamson wrote.
“The court of appeals explained that ‘a housing impact report is not required simply because the subject matter of a proposed rule relates to housing, or because the rule tangentially affects housing in some way.’ We agree.
The majority also concluded that the PSC was not required to make an on-the-record determination of whether a housing impact report was required. “We decline to read a procedural requirement into the statutes that the legislature opted not to impose.”
Finally, the court noted that the wind energy rules were subject to legislative scrutiny through the statutory review process. “[I]f we granted WRA its requested relief in the instant case, we would be usurping the legislative function by striking down rules that survived the legislature’s scrutiny,” Justice Abrahamson wrote.
Dissent
Chief Justice Patience Roggensack wrote a dissenting opinion, joined by Justice Annette Ziegler, concluding that a housing impact report was required. “I conclude that the Commission was obligated, as a matter of law, to obtain a § 227.115(2) housing report because ch. PSC 128 directly affects housing,” Roggensack wrote.
The chief justice noted that the rules have a “nexus to housing,” and therefore directly affect housing. She said the rules have setback requirements, restrict noise levels, and shadow flicker, “all of which regulate wind turbines’ effects on nearby housing.”
