NOTICE: This opinion is subject to motions for reargument under V.R.A.P. 40 as well as formal
revision before publication in the Vermont Reports. Readers are requested to notify the Reporter
of Decisions by email at: JUD.Reporter@vermont.gov or by mail at: Vermont Supreme Court, 109
State Street, Montpelier, Vermont 05609-0801, of any errors in order that corrections may be made
before this opinion goes to press.
2016 VT 86
No. 2015-372
In re Costco Stormwater Discharge Permit, Supreme Court
Costco Final Plat & Site Plan,
Costco Act 250 Land Use Permit, On Appeal from
Wetlands Reclassification, et al. Superior Court,
(R.L. Vallee, Inc. and Timberlake Associates LLP, Environmental Division
Appellants)
March Term, 2016
Thomas S. Durkin, J.
Jon T. Anderson of Burak Anderson & Melloni, PLC and Alexander J. LaRosa of
Murphy Sullivan Kronk, Burlington, for Appellant R.L. Vallee, Inc.
David L. Grayck of Law Office of David L. Grayck, Montpelier, for Appellant
Timberlake Associates LLP.
Mark G. Hall of Paul Frank + Collins P.C., Burlington, for Appellee.
William H. Sorrell, Attorney General, and Justin Kolber and Elizabeth Tisher,
Assistant Attorneys General, Montpelier, for Appellees Agency of Natural Resources and
Natural Resources Board.
PRESENT: Reiber, C.J., Dooley, Skoglund, Robinson and Eaton, JJ.
¶ 1. ROBINSON, J. This appeal is from a decision of the environmental division of
the superior court affirming several permits issued to appellee Costco Wholesale Corporation for
the expansion of its existing retail store and the addition of an adjacent six-pump gasoline station
in the Town of Colchester. Appellants R.L. Vallee, Inc. and Timberlake Associates LLP own
retail gasoline-service facilities located near the planned development. Appellant Vallee contends
the trial court erroneously: (1) determined that Costco’s proposed traffic-mitigation measures were
sufficient for issuance of an Act 250 permit; (2) made findings concerning the impact of an
underground stormwater outlet pipe not addressed below, and with respect to which the court
limited cross examination by Vallee’s counsel; (3) concluded that the project would not adversely
affect a Class 2 wetland for issuance of an individual wetland permit; and (4) excluded testimony
and a related exhibit prepared by appellant Vallee’s wetland consultant. Appellant Timberlake
asserts that the trial court erred in relying on a presumption with respect to the project’s impact on
water pollution and waste disposal under Act 250. We affirm.
¶ 2. Costco owns property off Route 7 in the Town of Colchester, where it operates a
members-only retail store. The Costco facility lies just north of the intersection of the junction of
Route 7, or the Roosevelt Highway, and Interstate 89 at Exit 16. To facilitate plans to expand the
store, reconfigure a portion of its parking lots, and add a gasoline sales facility, Costco applied
for—and was granted—a number of local and state permits, including final plat and site plan
approval from the Town of Colchester; a stormwater discharge permit from the Agency of Natural
Resources (ANR); an Act 250 land use permit; and an individual wetlands permit from ANR.
During the application and review process, appellant Timberlake successfully petitioned ANR to
reclassify a Class 3 wetland located on the project site to a Class 2 wetland (the so-called “Lot 5
wetland”), thereby triggering a fifty-foot buffer requirement around the wetland. As a result of
this change, Costo was required to get an individual wetland permit, which in turn required a ruling
that the project would not adversely affect the wetland’s identified functions and values. Vermont
Wetland Rule § 9.5(a), 6 Code of Vt. Rules 12 004 056, available at
http://www.lexisnexis.com/hottopics/codeofvtrules (Wetland Rules).
¶ 3. Appellants Vallee and Timberlake appealed all of the permit determinations to the
environmental division. A number of the appeals were settled, and the rest—the final plat and site
plan approval, stormwater discharge permit, wetland reclassification, individual wetland permit,
and Act 250 permit—were the subject of a coordinated multiple-day trial. In August 2015, the
court issued findings, conclusions, and a final judgment order affirming the remaining permits on
2
appeal. Appellants Vallee and Timberlake separately appealed.1 We set forth relevant facts as
they relate to the arguments on appeal.
¶ 4. “[B]ecause the trial court determines the credibility of witnesses and weighs the
persuasive effect of evidence, this Court will not disturb [its] factual findings unless, taking them
in the light most favorable to the prevailing party, they are clearly erroneous.” In re Route 103
Quarry, 2008 VT 88, ¶ 4, 184 Vt. 283, 958 A.2d 694 (quotation omitted). The trial court’s findings
“will not be disturbed merely because they are contradicted by substantial evidence; rather, [an
appellant] must show that there is no credible evidence to support them.” In re Miller Subdivision
Final Plan, 2008 VT 74, ¶ 13, 184 Vt. 188, 955 A.2d 1200. “Although we review the
environmental court’s legal conclusions de novo, we will uphold those conclusions if they are
reasonably supported by the findings.” In re Application of Lathrop Ltd. P’ship I, 2015 VT 49,
¶ 21, ___ Vt. ___, 121 A.3d 630 (citation and quotation omitted).
¶ 5. We note, as well, that “we generally give substantial deference to an agency’s
interpretations of its own regulations”—in this case ANR’s interpretation of the regulations
governing the wetland and stormwater discharge permits at issue. In re ANR Permits in Lowell
Mountain Wind Project, 2014 VT 50, ¶ 15, 196 Vt. 467, 98 A.3d 16. Appellants here “bear the
burden of showing that ANR’s interpretation is wholly irrational and unreasonable in relation to
its intended purpose.” Id. ¶ 17 (quotation omitted).
I. Traffic Issues
¶ 6. Appellant Vallee first asserts that the evidence failed to support the trial court’s
finding that Costco’s proposed near-term highway improvements were sufficient to mitigate the
1
A number of appellants’ claims involve issues pertaining directly or indirectly to more
than one permit. Although not entirely clear, appellant Vallee’s briefing suggests that its traffic
claims relate to the Act 250 permit, and the remainder of its claims relate to Costco’s individual
wetland permit. Appellant Timberlake’s claim concerns the Act 250 permit, although the
underlying issues pertain to the presumptive effect of ANR’s issuance of the stormwater discharge
permit.
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development’s traffic impacts under Criterion 5 of Act 250. See 10 V.S.A. § 6086(a)(5)(A)
(providing that Act 250 permit requires finding that development “[w]ill not cause unreasonable
congestion or unsafe conditions with respect to use of the highways”). Vallee contends that, while
long term improvements to the traffic flow at the I-89/Route 7 intersection may mitigate the traffic
impacts of this project, the near-term improvements proposed by Costco are themselves
insufficient to mitigate those impacts.
¶ 7. The trial court found that both Lower Mountain View Drive and Hercules Drive
provide access to Costco from Route 7. Lower Mountain View Drive intersects Route 7 about 100
yards north of the junction with I-89 and generally provides the greater flow of traffic into and out
of the Costco development. Hercules Drive intersects with Route 7 farther north and provides
better access to Costco visitors who are coming from or traveling to locations north of the I-
89/Route 7 junction.
¶ 8. During the afternoon weekday rush hour, traffic is particularly congested on Route
7 at the I-89 interchange, and will sometimes back up to the intersection with Lower Mountain
View Drive. The congestion has led the Vermont Agency of Transportation (VTrans) to propose
improvements to the I-89/Route 7 Exit 16 junction, including a signalized interchange known as a
Double Crossover Diamond. VTrans is pursuing permits for these improvements. The
improvements will be funded through several sources, including area businesses such as Costco.
However, the timeframe for its completion is uncertain and could run to ten years or more.
¶ 9. The trial court further found that the proposed Costco development would likely
cause 155 new vehicle trips during peak traffic hours. Most but not all of this new traffic will exit
Costco via Lower Mountain View Drive, turning left onto Route 7, toward the I-89 interchange.
To mitigate the impact of the additional traffic—which the court found to be “measurable, but not
substantial”—Costco proposed to construct certain near-term improvements to the Route 7/Lower
Mountain View Drive intersection, including the addition of a second dedicated left-hand turn lane
4
from Lower Mountain View Drive onto southbound Route 7, a second dedicated right-hand turn
lane for vehicles turning right from Lower Mountain View Drive onto northbound Route 7, and
another travel lane for through traffic and traffic turning right onto Route 7 from Lower Mountain
View Drive. In addition, Costco has proposed better synchronization of traffic lights at all area
intersections “to allow for more optimal traffic flow,” and a “Do Not Block Driveway” sign at the
curb cut for Vallee’s facility. The court found that these improvements would “fully mitigate the
additional traffic that the proposed Costco [development] will generate,” and thus determined that
the development complied with Criterion 5.
¶ 10. Vallee maintains that there was “no evidence” to support the trial court’s finding
that Costco’s proposed near-term improvements to the Lower Mountain View Drive intersection,
without reconfiguration of the I-89 interchange, were sufficient to mitigate the project’s full traffic
impacts. Vallee contends that the expert simulations relied upon by Costco assumed the
completion of the reconfiguration of the I-89 interchange, and that reconfiguration was essential
to mitigate the project-generated traffic. Vallee argues that the improvements to the Route
7/Lower Mountain View Drive intersection are inadequate to mitigate the effects of the additional
traffic at the I-89/Route 7 interchange, and that they do nothing more than increase “storage
capacity” for cars to wait in traffic at Lower Mountain View Drive and Exit 16. For these reasons,
Vallee argues the trial court erred in refusing to condition approval of the Act 250 permit upon
completion of the I-89 interchange improvements.
¶ 11. As noted, before granting an Act 250 permit, a district commission or court must
find that a project “[w]ill not cause unreasonable congestion or unsafe conditions with respect to
use of the highways.” 10 V.S.A. § 6086(a)(5)(A). The burden of proof in this regard “shall be on
any party opposing the applicant.” Id. §6088(b). The applicant nevertheless bears the burden of
production to establish at least a “prima facie case” of compliance. In re Champlain Parkway Act
250 Permit, 2015 VT 105, ¶ 15, ___ Vt. ___, 129 A.3d 670. While a court or district commission
5
may not deny an application “solely for the reasons set forth” in Criterion 5, it may impose
“reasonable conditions and requirements” consistent with the police power to “alleviate the
burdens created” by the project. 10 V.S.A. § 6087(b); see also id. § 6086(c) (“A permit may
contain such requirements and conditions as are allowable proper exercise of the police power.”).
¶ 12. Viewed in the light of these standards, we conclude the record evidence here was
sufficient to support the trial court’s findings and conclusions under Criterion 5. With respect to
the impact of the additional traffic at the I-89 interchange, Costco’s traffic expert testified that the
estimated 155 additional peak-hour trips generated by the project represented “a very small
percentage of the overall daily [vehicular] traffic” in the area, which numbered in thousands along
the busy Route 7 corridor adjacent to Costco; that this figure was less than the daily fluctuations
in traffic volume at those intersections, and thus “small enough” to be considered by traffic
engineers as “insignificant”; and that, from a traffic-engineering perspective, the project would
have no “significant or measurable effect on . . . future safety trends at the intersection.”
¶ 13. With respect to the Lower Mountain View Drive/Route 7 intersection, Costco’s
expert testified that the proposed near-term improvements would mitigate the additional traffic
generated by the project, even without the I-89 interchange modification. These improvements,
as noted, included the addition of turning lanes, signal-timing modifications, and additional
signage. The expert testified that these changes would provide “additional capacity at the
[Mountain View Drive] intersection” and “improve[] queuing conditions.” Although that expert
testified that modifying the I-89 interchange to a double diamond configuration would “have the
greatest overall benefit to traffic operations throughout the study area,” when asked whether the
near-term improvements would “mitigate completely the additional traffic resulting from the
Costco project” even ignoring the anticipated reconfiguration of the I-89 interchange, the expert
stated categorically that “they will.”
6
¶ 14. In its findings and conclusions relating to Criterion 5, the trial court relied on the
report and testimony of Costco’s traffic expert, having found that she “presented the most credible
explanation and examination of the current traffic challenges, how the proposed Costco
improvements will impact on existing and future traffic, and to what extent the proposed mitigation
steps will alleviate overall traffic concerns.” This was a judgment well within the trial court’s
broad discretion to assess the credibility of the witnesses and the persuasive value of the evidence.
In re Entergy Nuclear Vt. Yankee Discharge Permit, 2009 VT 124, ¶ 15, 187 Vt. 142, 989 A.2d
863. Thus, we conclude that the evidence here was sufficient to support the trial court’s conclusion
that the proposed near-term improvements to the Mountain View Drive intersection “will fully
mitigate the adverse traffic impacts caused by” the Costco project, and that, thus mitigated, the
project impacts did not “warrant . . . conditioning the [project] . . . on the completion” of the
planned I-89 improvements.
¶ 15. Vallee’s principal objection to the court’s ruling focuses on the conclusion shared
by all of the experts, Costco’s included, that any meaningful alleviation of traffic congestion along
the Route 7 corridor would require a modification of the I-89 interchange. Vallee asserts, in this
regard that “improved storage does not negate . . . congestion.” The issue, however, was not
whether the near-term improvements would alleviate the already-existing congestion in the area,
but whether they would mitigate the relatively small impacts generated by the project, and the
Costco traffic expert’s opinion—as noted—was clear in this regard.
¶ 16. For the same reason, Vallee’s claim that the trial court misapplied our decision in
In re Pilgrim Partnership, 153 Vt. 594, 572 A.2d 909 (1990), is wide of the mark. In Pilgrim
Partnership we held that Criterion 5 “does not require that [a] proposed [project] be the principal
cause or original source of traffic problems” in order to support the imposition of reasonable
conditions to alleviate any additional burdens created; it is sufficient if the project “would
contribute to the existing traffic problem.” Id. at 596, 572 A.2d at 910. In that case, we affirmed
7
a determination by the environmental board that a project that led to a 5% increase in traffic on a
narrow, curved road that already had a dangerous level of traffic would contribute to the congestion
problem.
¶ 17. Our decision in Pilgrim Partnership did not establish that in every case, an increase
of 5% in an already congested area is sufficiently substantial to require mitigation; rather, we
affirmed the reasonableness of the environmental board’s determination that in that case it was.
Here, the trial court expressly recognized and properly applied Pilgrim Partnership by conditioning
approval of the Act 250 permit on the construction of those near-term improvements that it found
to be necessary—and sufficient—to mitigate the project’s contribution to the existing congestion
in the area. Accordingly, we conclude that the trial court finding of compliance with Act 250’s
Criterion 5 was supported.
II. The Underground Pipe
¶ 18. Vallee asserts that the court erred in approving the wetland permit with an
underground pipe not considered by ANR, and denied Vallee the opportunity to present evidence
concerning that pipe. The background to these claims is as follows.
¶ 19. The permitting process for the Costco development spanned a number of years and
required the review and approval of several agencies. In May 2012, Costco obtained a stormwater
discharge permit from ANR to revise and upgrade the stormwater treatment and discharge system
at the site. In July 2012, the Colchester Development Review Board granted final plat and site
plan approval. In January 2013, the district commission approved Costco’s Act 250 permit
application; the commission noted that the ANR stormwater permit created a rebuttable
presumption of compliance with Criterion 1(B) regarding waste disposal, and concluded that
Vallee had not adduced evidence sufficient to rebut the presumption. In September 2013, ANR
granted Timberlake’s petition to reclassify the wetland located on the project site from Class 3 to
Class 2, the effect of which was to prohibit any further development in the wetland or its associated
8
buffer zone absent specific approval. 10 V.S.A. § 913(a). Finally, in March 2014, ANR issued an
individual wetland permit, authorizing Costco to build and operate a portion of the project,
consisting of gas pumps and a parking lot, as well as upgrades to the existing stormwater system,
within the buffer zone.
¶ 20. The revised stormwater discharge system is designed to route a substantial portion
of the stormwater runoff from the Costco site through a series of improved “detention ponds” and
several new “pre-treatment structures” to remove oil, sediment, and grit, and ultimately pass the
treated stormwater through an underground pipe to discharge through a new outlet structure near
an existing culvert into Sunnyside Brook. The proposed underground pipe and outlet are partly
located within a portion of the reclassified Lot 5 wetlands buffer. The pipe is to be installed by a
process of “underground directional drilling.”
¶ 21. Given that ANR had not considered this pipe in approving Costco’s wetland permit
application, Vallee argued below that the environmental division was obligated to remand the
permit to ANR so that ANR could consider it in the first instance.
¶ 22. The court declined to do so, finding that installation of the pipe and outlet
structure—located adjacent to a “pre-existing culvert that already transports stormwater to
Sunnyside Brook”—would have “no impact upon the surrounding land, the wetland, its buffer, or
Sunnyside Brook.” The court further noted, and appellant does not dispute, that “it appears that
the details of this pipe and outlet structure” were delineated in 2008 and reflected in Costco’s
“Stormwater Details Site Plan” admitted as a Costco exhibit at trial. The court acknowledged that
ANR did not consider the underground pipe and outlet structure in awarding the wetland permit,
but offered a likely explanation. When Costco first filed its wetlands permit application the
reclassification which resulted in the creation of a protected wetland buffer zone had not yet
occurred; thus, the court concluded that the underground pipe and outlet were disclosed but may
have been overlooked “because at that time, no wetland buffer had been delineated.” As the court
9
explained, the “pipe and [outlet] structure were disclosed by Costco but simply didn’t raise enough
concern for ANR and other parties during the wetland permit proceeding.”
¶ 23. The lack of administrative review notwithstanding, “the credible evidence
showed,” the court found, “that this underground pipe and outlet structure will have no more than
minimal impacts, if any, on the protected wetland buffer and will not impact individuals not
already parties to these proceedings and are not, therefore, so material as to warrant a remand for
a wholly new review and notice publication by ANR.”
¶ 24. Vallee asserts that the court’s ruling was erroneous because the court lacked
“jurisdiction” to address the matter, and improperly prohibited cross-examination of Costco’s
expert on the issue. The claims are unpersuasive. We have held that the environmental court is
not required to remand a project to an administrative agency for additional review where later
revisions are relatively “insubstantial” and do not “affect new parties not participating in the
proceedings.” In re Lathrop Ltd. P’ship I, 2015 VT 49, ¶¶ 102, 109. The trial court here recognized
and applied this principle in determining that a remand to ANR was unnecessary because the
evidence showed that the impacts from the pipe and outlet structure to the wetlands and
surrounding buffer would be minimal, and would not affect any parties not before the court. Vallee
has adduced no evidence or argument to show that the court’s decision in this regard was an abuse
of discretion. See id. ¶ 99 (noting that “[o]ur standard of review for the environmental court’s
decision to remand a permit application is abuse of discretion”).
¶ 25. Vallee’s objection that the court lacked jurisdiction because Costco did not
expressly “request” that the permit be amended to include the pipe and outlet structure is
unsupported; even in the absence of a specific request, the trial court had ample authority to
approve the permit with revisions reflecting the pipe—if they were revisions at all—where it
concluded that it did not detrimentally affect the environmental review criteria or unrepresented
parties.
10
¶ 26. Equally unsupported is the assertion that the court improperly prevented Vallee
from presenting evidence concerning the pipe and outlet. Vallee bases this claim on the court’s
ruling sustaining an objection to a single question to a Costco expert. The record shows that
appellant cross-examined the witness specifically about the underground pipe and outlet. The
expert testified that the installation of the pipe through a process of “directional drilling” would
have no negative impact on the wetland or wetland buffer. When asked whether Costco’s permit
application had considered any “improvements” to be installed around the proposed outlet, the
court sustained an objection based on the witness’s earlier testimony that she had no knowledge
of any planned structure or improvements. The court explained that on the basis of the record as
it then stood, there was no foundation in the record for questions about the structure. Vallee has
not shown that the court either abused its discretion or violated Vallee’s due process rights in so
ruling. See Gilman v. Towmotor Corp., 160 Vt. 116, 123, 621 A.2d 1260, 1264 (1993) (“The
extent to which a party may cross-examine a witness is within the sound discretion of the court.”).
III. Impact on Class 2 Wetland
¶ 27. Vallee also challenges the trial court’s conclusion that the project will not have an
undue adverse impact on the functions and values of the wetland justifying its designation as a
protected wetland, and argues that the court failed to consider cumulative impacts on the Lot 5
wetland. By way of background, Costco’s current stormwater treatment system was installed in
1993 when the Costco facility was first constructed. The system relies in large part on the use of
stormwater detention ponds, a filter strip, ditches, and grassed areas in or near the wetland to
remove contaminants. The court found that the current system fails to adequately collect and treat
stormwater from the Costco site before it flows into the Lot 5 wetland and Sunnyside Brook, and
does not comply with current Vermont Stormwater Management Rules. The new system would
improve the existing detention ponds to store more stormwater for longer periods, and replace the
overland flows over grass filters with a series of channels and treatment tanks and an underground
11
pipe terminating at Sunnyside Brook. The court found that the new system would decrease the
direct flow of stormwater—much of it containing contaminants—into the Class 2 wetland on Lot
5.
¶ 28. At trial, Vallee argued that by diverting stormwater that currently flows directly
into the wetland to other treatment areas, the new system would actually harm the wetland by
reducing its water level. The court found that no credible evidence supported the claim, and that
Costco’s and ANR’s experts had offered credible evidence to refute it. The court also found no
credible evidence to support Vallee’s claim that the new treatment system would adversely reduce
the groundwater in the area. Thus, the court concluded that the new system would not impair, and,
in fact, would improve, the wetland’s ability to perform the functions identified by ANR.
¶ 29. On appeal, Vallee contends that Costco’s “analysis” failed to address the “loss in
wetlands functionality” resulting from the diversion of stormwater under the new system. The
claim essentially is that the evidence did not support the trial court’s findings that the new system
would not adversely affect the wetland’s functions.
¶ 30. The record shows otherwise. Costco’s wetland consultant testified that the
diversion of untreated stormwater from the wetland represented an “enhancement” of its quality,
a “net benefit because there won’t be pollutants going into the wetland anymore,” and further
testified that she could not identify “any [adverse] impacts” to wetland functions from the new
stormwater system. The same witness explained that runoff from the Costco site was not
fundamentally “supporting that wetland . . . it’s supported by a combination of groundwater and
surface water, [and] having the Costco [water] go somewhere else is better than using the wetland
as the treatment for that water.” A wetland ecologist with ANR similarly testified that the
diversion of largely untreated stormwater would not affect the wetland’s quality or functions, that
it would continue to receive and store water from other sources, including stormwater run-off from
roadways and other properties, as well as “precipitation and groundwater,” and that the new system
12
would not “alter the physical and vegetative characteristics of the wetland” to the detriment of its
functions. This evidence was more than adequate to support the court’s finding that the project
and new stormwater system would not adversely affect the Lot 5 wetland.
¶ 31. Vallee asserts, nevertheless, that Costco’s evidence was deficient in failing to
“compare the quality and quantity of Costco’s stormwater” entering Sunnyside Brook under the
current and proposed treatment systems, and asserts that the new system will result in a net loss in
water quality and undermine the wetland’s downstream erosion-protection function. The claim is
unsupported. The record here discloses that environmental analysts for ANR testified that the
existing Costco stormwater system’s heavy reliance on the wetland itself and an imbedded “filter
strip” to cleanse stormwater of contaminants does not meet current stormwater treatment
standards. ANR’s stormwater-system analyst testified further that Costco’s proposed new system
did meet current treatment standards—specifically for purposes of ensuring adequate water
quality, groundwater recharge, flood protection, and channel protection. Costco introduced
substantial testimony by environmental analysts that the new system’s expanded stormwater-
storage facilities and outlet structures designed to control the volume and flow-rate of water
released through the system would enhance water quality in the wetland, provide additional
downstream channel and erosion protection, and improve the quality of water flowing to
Sunnyside Brook. This was sufficient to support the court’s finding that the project would not
adversely affect the wetland’s core functions and values. No more was required.
¶ 32. Vallee additionally contends that the trial court improperly failed to consider
“cumulative impacts” in determining that the project would have only a “minimal” impact—if
any—on the Lot 5 wetland, and therefore improperly failed to require “mitigation sequencing.”
See Wetland Rule § 9.5 (in determining whether proposed activity will have “other than a minimal
impact” on wetland’s “protected functions and values,” activity must be evaluated on basis of
13
immediate as well “any cumulative ongoing effects” and any undue adverse impact must be
addressed by “mitigation sequencing”).
¶ 33. We disagree. ANR’s wetland ecologist testified expressly that the State had
determined that the Costco project would have no “more than a minimal impact to the functions
and values of the [Lot 5] wetland,” and confirmed that the State had “consider[ed] cumulative
impacts” in its review of the permit application. The witness explained that the State was
specifically aware of, and had considered, the ongoing impact of the existing development that
“essentially bounds [the wetland] on all sides,” including roads, other commercial developments,
and the Costco facility. Thus, the record supports the trial court’s finding that the project would
have no more than a minimal effect on the wetland’s ability to serve its core functions. Vallee’s
assertion that, in reaching this conclusion, the court incorrectly compared the project’s preexisting
and anticipated impacts on the wetland rather than its anticipated impacts “in addition” to the prior
impacts, finds no credible support in the record.
IV. Restriction of Vallee’s Expert Testimony
¶ 34. Finally, Vallee argues that the trial court erroneously excluded an exhibit prepared
by its stormwater-management consultant and related testimony designed to demonstrate that
Costco’s existing stormwater-treatment system is superior to the proposed system for removing
stormwater contaminants and reducing downstream erosion.
¶ 35. In an earlier ruling, the court had excluded as unreliable the same expert’s
testimony concerning the results of a stormwater analysis using a computer software program
known as WinSLAMM (Source Loading and Management Model). Based on extensive testimony
from a number of environmental analysts, the court found that the WinSLAMM computer model
was not designed to “accurately predict stormwater infiltration rates within a wetland” and that
appellant had not shown “comparable use” of the model within Vermont or elsewhere. Thus, the
14
court concluded that the testimony was “unreliable and insufficient under the U.S. Supreme
Court’s standard in Daubert.” See Daubert v. Merrell Dow Pharm., Inc., 509 U.S. 579, 589-92
(1993) (establishing test for admissibility of expert testimony based on showing that scientific
evidence is relevant and reliable); USGen New England, Inc. v. Town of Rockingham, 2004 VT
9, ¶¶ 18-19, 177 Vt. 193, 862 A.2d 269 (noting that Vermont has adopted “admissibility principles”
of Daubert for expert evidence, and that courts must “act as gatekeepers who screen expert
testimony ensuring that it is reliable and helpful to the issue at hand”); V.R.E. 702 (essentially
codifying Daubert guidelines for reliability of expert testimony). Vallee has not challenged that
ruling.
¶ 36. The same expert later testified extensively on his supplemental analysis of the
current and proposed stormwater systems, an analysis modified—according to appellant—to
conform to the court’s earlier ruling. Overruling an objection by Costco, the court ruled that it
would admit the expert’s testimony and “afford it the appropriate weight.” The witness
subsequently testified to his view that Costco’s proposed system would increase the volume of
stormwater entering Sunnyside Brook, resulting in more erosion and contaminants. He explained
that this would result from diverting runoff so that it enters the brook as “stormwater flow” rather
than absorbing or “infiltrating” it under the current system so that it enters as groundwater “base
flow.” The expert also described the “inputs” to the software model that he had utilized to derive
a quantitative comparison of runoff and contaminants entering Sunnyside Brook under the
proposed and existing systems, shown in appellant’s Exhibit 126. These included an average
measure of the existing system’s filter strip, an average measure of the slope of the existing grass
swale, an average “infiltration rate” for the soil in the area, an average “precipitation record” based
on total precipitation from the year 1999 at the Burlington Airport, and an input designed to
calibrate “east coast conditions” for average “amounts of pollution generated from . . . surfaces.”
15
¶ 37. The trial court ultimately excluded Exhibit 126 based on concerns about the
reliability of the computer-model inputs and whether they accurately reflected actual on-the-
ground conditions. The court cited in particular the use of an average rather than specific measures
accurately reflecting the variability of the existing filter strip, contradictory testimony from other
witnesses about the efficacy “of the 20-year-old filter strip,” an underestimation of the efficiency
of the new system, and the use of only one specific year of rainfall as a guide. The court concluded
that, “in essence,” the exhibit’s probative value was substantially outweighed by its prejudicial
effect.
¶ 38. Vallee contends that the court’s reliance on Vermont Rule of Evidence 4032 in a
bench trial was improper, and that its concerns about the exhibit were unfounded. Although some
courts have questioned the usefulness of excluding evidence on the basis of “unfair prejudice” in
a bench trial, see, e.g., Gulf States Utils. Co. v. Ecodyne Corp., 635 F.2d 517, 519 (5th Cir. 1981),
this Court has not considered the issue, and we need not do so here. While citing Rule 403, the
trial court’s analysis showed that it was effectively finding the methodology underlying the exhibit
to be unreliable, an exercise committed to the sound discretion of the trial court whether in a bench
or a jury trial. See USGen New England , 2004 VT 90, ¶ 25 (noting that, although courts have
recognized that their “gatekeeping role is less critical” when trial court sits as factfinder, none have
abandoned “the requirement that the judge find the expert’s testimony relevant and reliable”).
¶ 39. As for Vallee’s claim that the court’s ruling was unfounded, we have explained that
Daubert issues “depend[] heavily on the record . . . and the credibility of the expert witness,” and
thus are subject to review solely for abuse of discretion. Id. ¶ 22. When reviewing a court’s
decision in this regard, we must determine whether it was “made for reasons clearly untenable,”
2
V.R.E. 403 provides that relevant evidence “may be excluded if its probative value is
substantially outweighed by the danger of unfair prejudice, confusion of the issues, or misleading
the jury, or by considerations of undue delay, waste of time, or needless presentation of cumulative
evidence.”
16
and absent a “clear showing of . . . error . . . we will affirm the trial court’s decision.” Id. ¶ 24.
The evidence supported the court’s findings concerning the lack of connection between the average
measures utilized in the expert’s computer model and the actual age, functioning, and variability
of the filter strip in Costco’s existing system. Moreover, and perhaps more significantly, the record
here shows that the expert provided lengthy and detailed testimony and supporting exhibits to
advance his opinion concerning the superior capacity of Costco’s existing stormwater system to
prevent pollution and erosion in Sunnyside Brook. Thus, we are not persuaded that the court’s
exclusion of the exhibit in question—even if erroneous—was substantially prejudicial to
appellant’s case. See In re Eastview at Middlebury, Inc., 2009 VT 98, ¶ 22, 187 Vt. 208, 992 A.2d
1014 (observing that appellant had failed to show how, in light of admission of expert’s report,
exclusion of portion of his testimony “prejudiced her in this bench trial”); V.R.C.P. 61 (courts
must disregard any error or defect in proceeding “which does not affect the substantial rights of
the parties”).3
V. Water Pollution and Waste Disposal Criteria
¶ 40. Appellant Timberlake’s sole claim is that the evidence failed to support the trial
court’s conclusion that the project met the Act 250 criteria for water pollution and waste disposal.
See 10 V.S.A. §§ 6086(a)(1) (requiring that development “[w]ill not result in undue water . . .
pollution”) & 6086(a)(1)(B) (requiring that applicant demonstrate project will meet applicable
environmental regulations “regarding the disposal of wastes” and not inject “waste materials or
any harmful or toxic substances into ground water or wells”).
¶ 41. Timberlake acknowledges that Costco’s stormwater discharge permit from ANR
established a presumption of compliance with these statutory requirements. See 10 V.S.A.
3
In light of our decision, we need not address Costco’s additional argument that the
evidence was essentially irrelevant because compliance with the Vermont Stormwater
Management Rules does not require a comparison of performance between a proposed and
preexisting system.
17
§ 6086(d) (providing that Natural Resources Board “may by rule allow the acceptance of a permit
or permits or approval of any State agency with respect to subdivisions (a)1) through (5) of this
section . . . in lieu of evidence by the applicant” and that “acceptance of such . . . permit . . . shall
create a presumption that the application is not detrimental to the public health and welfare with
respect to the specific requirement for which it is accepted”); Environmental Bd. Rule 19(E)(1)
(providing that ANR permit creates presumption that wastewater can be disposed of through
treatment system “without resulting in undue water pollution”).
¶ 42. The presumption of compliance may, nevertheless, be challenged and rebutted by
“any party,” who “shall state the reasons therefor and offer evidence at a hearing to support its
challenge.” Environmental Bd. Rule 19(F); see also In re Hawk Mountain Corp., 149 Vt. 179,
182, 542 A.2d 261, 263 (1988) (noting that certificate of compliance from Agency of
Environmental Conservation “created a rebuttable presumption that the [proposal] . . . complie[d]
with regulations governing the land application of waste disposal”). “Upon the rebuttal of the
presumption, the applicant shall have the burden of proof under the relevant criteria and the permit
. . . shall serve only as evidence of compliance.” Environmental Bd. Rule 19(F).
¶ 43. Timberlake maintains that it effectively rebutted the presumption arising from
Costco’s stormwater permit through cross-examination of ANR’s stormwater compliance analyst.
The witness had testified on direct examination that the stormwater discharge permit was issued
based on ANR’s determination that Costco’s proposed treatment system met the current design
specifications in the Vermont Stormwater Management Manual for all necessary criteria, including
removal of eighty percent of the total suspended solids and forty percent of total phosphorus. On
cross-examination, the witness underscored that “compliance with the stormwater management
manual is designed for the express purpose of achieving the water quality standards.” She
explained that the design standards in the manual were based on standards established by the
Center for Watershed Protection, a national nonprofit organization that studies and develops
18
stormwater and watershed management practices. The official acknowledged that, apart from
maintenance inspections, ANR does not routinely monitor systems deemed in compliance with the
standards to test their performance, and had not run any specific tests on Costco’s system.
¶ 44. Timberlake asserts that it effectively rebutted the presumption arising from the
stormwater permit by demonstrating that “the real fact of no undue water pollution under Criterion
1, and no injection of waste materials under Criterion 1(B), is not as presumed by the trial court.”
¶ 45. The argument is unpersuasive. The statute and rule contemplate that a party may
adduce evidence to show that a project will not comply with the relevant Act 250 criteria
notwithstanding an agency permit. See, e.g., Hawk Mountain Corp., 149 Vt. at 186, 542 A.2d at
265 (holding that town’s expert testimony that proposed sewage system “did not comply with
several of the health regulations . . . including standards for distances between leach field, for
emergency replacement areas and for manhole distribution” was sufficient to rebut presumption).
Timberlake here adduced only an acknowledgment that ANR had relied on design standards for
stormwater treatment systems established by a national stormwater-management research and
development organization rather than performance-testing the systems itself. The decision to use
the chosen design standards is well within ANR’s discretion. See 10 V.S.A. § 6086(d) (providing
that “[i]n the case of approvals and permits issued by the Agency of Natural Resources, technical
determinations of the Agency shall be accorded substantial deference”); In re ANR Permits, 2014
VT 50, ¶ 15 (we give “substantial deference” to ANR’s interpretation of its own regulations).
Here, rather than producing affirmative evidence to rebut the presumption, Timberlake merely
elicited evidence that the expected performance impact of ANR’s design standards had not been
validated by local field tests. Evidence that the design standards have not been proven to yield the
expected performance outcomes is not the same thing as evidence that the design standards do not
in fact yield those outcomes, and Timberlake’s cross-examination is not enough to burst the
presumption and shift the burden of proof back to Costco.
19
¶ 46. For the above reasons, we reject Vallee’s and Timberlake’s claims on appeal, and
affirm the environmental division’s judgment.
Affirmed.
FOR THE COURT:
Associate Justice
20
In re Costco Stormwater Dishcharge Permit, Costco Final Plat & Site Plan, Costco Act 250 Land Use Permit, Wetlands, Reclassification (R.L. Vallee, Inc. and Timberlake Associates LLP, Appellants)
Court: Supreme Court of Vermont
Date filed: 2016-08-05
Citations: 2016 VT 86, 202 Vt. 564, 151 A.3d 320
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