Once unknown, high capacity wells have become increasingly familiar to both Wisconsinites and environmental lawyers.

With the ability to pump more than 100,000 gallons of groundwater per day,¹ high capacity wells are an integral part of industry, irrigated agriculture, municipal water use, and concentrated animal feeding operations (CAFOs). The number of high capacity wells in Wisconsin has risen dramatically in the last 50 years, from just 1,762 in 1967 to more than 13,270 in 2017.²

But high capacity well operators have neighbors, and scientists have found that the wells can draw down surrounding groundwater levels, ultimately reducing groundwater flow to nearby wells and surface water bodies.³ This potentially impacts neighboring water users, reducing their access to water for consumption, business and industry, and recreation.

The DNR’s Authority

The tension between industry and science has led to increasing litigation over the regulatory powers of the Department of Natural Resources (DNR), the agency tasked with permitting high capacity wells.

In 2011, the Wisconsin Supreme Court unanimously held in Lake Beulah Mgmt. Dist. v. State Dep't of Nat. Res.⁴ that DNR has the authority and duty to protect waters of the state in its permit decisions, pursuant to the public trust doctrine⁵ and Wis. Stat. sections 281.11, 281.12, 281.34, and 281.35:

[T]o comply with this general duty, the DNR must consider the environmental impact of a proposed high capacity well when presented with sufficient concrete, scientific evidence of potential harm to waters of the state.⁶

In 2013, DNR asked then-Attorney General (AG) J.B. Van Hollen for guidance in applying Lake Beulah to pending and future high capacity well permits. Van Hollen declined, on the principle that AG opinions cannot be given on an issue that is subject to current or reasonably imminent litigation.⁷ But in 2016, Wisconsin State Assembly leaders renewed that request, this time to Attorney General Brad Schimel, who obliged.

Wisconsin Act 21, OAG 1-16, and Lake Beulah

The AG’s opinion, OAG 1-16, analyzed Lake Beulah in light of 2011 Wisconsin Act 21, enacted just one month prior to the Lake Beulah decision.

Act 21 is a comprehensive statutory scheme limiting state agency rulemaking authority by, inter alia, prohibiting an agency from implementing or enforcing any standard, threshold, or requirement – including a permit condition – unless explicitly required or authorized to do so by statute or rule.⁸

In the AG’s opinion, the Lake Beulah court had given Act 21 “short shrift,” failing to fully analyze it because it wouldn’t apply retrospectively to the Lake Beulah facts. Therefore, the AG reasoned, the court’s broad interpretation of DNR’s public trust authority was no longer controlling.

Furthermore, he concluded, neither the public trust doctrine nor any other statutory authority gives DNR the power to place certain conditions on high capacity well permits.

Following OAG 1-16, DNR approved a backlog of high capacity well permits, granting them without conditions to protect neighboring water supplies.

Clean Wisconsin and Pleasant Lake Mgmt. Dist. v. DNR.

In Clean Wisconsin and Pleasant Lake Management District v. DNR⁹, petitioners challenged eight¹⁰ high capacity well permits submitted to DNR prior to OAG 1-16 and approved without conditions following it.

Clean Wisconsin argued DNR’s permit approvals violated the agency’s constitutional duties under the public trust doctrine. For each well, petitioners pointed to statements by DNR scientists concluding that the well would have potential adverse impacts on waters of the state, falling within the public trust doctrine, including protected trout streams, “outstanding resource waters,” and “exceptional resource waters.”

Having identified those adverse impacts, petitioners claimed, DNR was constitutionally obligated to impose permit conditions to protect the waters, which the agency had explicit authority to do under Wis. Stat. chapter 281. This process was demanded by the holding in Lake Beulah, they maintained.

Furthermore, they argued, OAG 1-16 was fundamentally flawed in its conclusion that the Lake Beulah court had not considered Act 21 in its reasoning. They emphasized footnote 31 of the court’s decision, which reads in pertinent part:

Our conclusion is not affected by the argument advanced by the Great Lakes Legal Foundation (GLLF) … that 2011 Wisconsin Act 21, enacted on May 23, 2011, further circumscribes the DNR's authority to consider environmental harm under Wis. Stat. ch. 281 ….

None of the parties argues that the amendments to Wis. Stat. ch. 227 in 2011 Wisconsin Act 21 affect the DNR's authority in this case. The DNR responds that Wis. Stat. ch. 281 does explicitly confer authority upon the DNR to consider potential environmental harm presented by a proposed high capacity well. The conservancies agree. The Village maintains that the DNR lacks such authority under Wis. Stat. ch. 281 but states that “Wis. Stat. § 227.10(2m) does not change the law as it relates to the authority of the [DNR] to issue high capacity well approvals under Wis. Stat. § 281.34.” We agree with the parties that 2011 Wisconsin Act 21 does not affect our analysis in this case. Therefore, we do not address this statutory change any further.

Rather than giving Act 21 “short shrift,” petitioners argued, the court fully addressed Act 21 and determined it inapplicable because chapter 281 did confer explicit authority on DNR to consider potential adverse environmental impacts in its permit decisions.

But DNR countered, asserting “[a]s a general matter, the supreme court would not have disposed of such a weighty issue in a single footnote.” DNR reasoned that the footnote only served to explain that while the parties had disputed whether chapter 281 gave DNR explicit authority to consider environmental impacts, the court had agreed that it need not include Act 21 in its analysis because it had been enacted after the facts of the case.

Moreover, DNR argued, Clean Wisconsin’s reliance on Lake Beulah was misplaced entirely because a later case, Rock-Koshkonong Lake Dist. v. State Dep't of Nat. Res.,¹¹ had clarified the scope of the public trust doctrine in a way that rendered Lake Beulah inapplicable to high capacity well permits. Per DNR’s position, Rock-Koshkonong held that any authority over water and land beyond the ordinary high water mark of a water body comes from DNR’s statutory police powers, not its constitutional public trust duty.

Therefore, because high capacity wells are located on land beyond the ordinary high water mark, the public trust doctrine does not apply. To wit: because DNR’s authority over high capacity wells derives from its police powers, which the Wisconsin Legislature explicitly delegates to it, the power to impose permit conditions is constrained by Act 21 and the explicit considerations listed in Wis. Stat. section 281.34(4)-(5). DNR concluded neither law authorized it to consider potential adverse impacts to waters of the state in order to impose permit conditions, as claimed by Clean Wisconsin.

Police Powers or Public Trust Duties

In October 2017, the Dane County Circuit Court disagreed. Quoting extensively from Lake Beulah, the decision rejected DNR’s Rosh-Koshkonong argument that high capacity well permits implicate only police powers, not public trust duties, stating the public trust doctrine “has never been interpreted that narrowly.”

In regard to footnote 31, the court concluded that if Act 21 had been “so radical” as to limit the ability of the DNR to consider only very limited factors in its permit decisions, the supreme court would have addressed it further, but it did not.

And in a footnote to its decision, the court declared OAG 1-16 unpersuasive, explaining:

First, it states that the legislative changes to Wis. Stat. § 227.11(2)(a) and Wis. Stat. § 227.10(2m) were designed to overrule Lake Beulah. However, these changes were addressed in the decision because they predated the decision. It also argues that the reasoning used by the Court was because the changes were not retroactive but rather prospective. However, the Court did not mention this issue in its decision at all. Instead, the Court stated that the DNR has explicit authority under Wis. Stat. § 281.11 and § 281.12 to consider potential harms by a proposed high capacity well.

The court went on to hold that, under the public trust doctrine, DNR may consider potential adverse harm to waters of the state and impose high capacity well permit conditions under the explicit authority of chapter 281.

In all but one of the permits, she concluded, DNR had determined that public trust waters would be adversely impacted, which triggered DNR’s constitutional duty to protect them.

Going Forward

Clean Wisconsin may yet be appealed. If so, it will not be the only case before the appellate courts challenging DNR’s regulatory powers in light of Act 21.

Last year, a circuit court overturned DNR’s similarly limited interpretation of its authority in the context of a Wisconsin Pollutant Discharge Elimination System (WPDES) permit, and the case is now before the supreme court on a supervisory writ.¹²

High capacity wells have also seen recent legislative changes, with a new law allowing owners to repair, replace, reconstruct, or transfer ownership of a well without obtaining additional approval from DNR or paying a fee.¹³

This steady stream of legislation and court cases indicates high capacity well permitting will continue to be an area of importance for environmental law practitioners statewide.

Endnotes