Wasco LLC v. N.C. Dep't of Env't & Natural Res.

IN THE COURT OF APPEALS OF NORTH CAROLINA

No. COA16-414

Filed: 18 April 2017

Wake County, No. 15 CVS 1438

WASCO LLC, Petitioner,

v.

N.C. DEPARTMENT OF ENVIRONMENT AND NATURAL RESOURCES,
DIVISION OF WASTE MANAGEMENT, Respondent.

Appeal by petitioner from order and judgment entered 23 October 2015 by

Judge G. Bryan Collins, Jr., in Wake County Superior Court. Heard in the Court of

Appeals 6 October 2016.

King & Spalding LLP, by Cory Hohnbaum and Adam G. Sowatzka, pro hac
vice, for petitioner-appellant.

Attorney General Joshua H. Stein, by Special Deputy Attorney General Daniel
Hirschman, for respondent-appellee.

McCULLOUGH, Judge.

Petitioner WASCO LLC (WASCO) appeals from the final order and judgment

in which the trial court affirmed the administrative law judge’s (ALJ) denial of

WASCO’s motion for continuance and affirmed the ALJ’s grant of summary judgment

in favor of respondent North Carolina Department of Environment and Natural

Resources (the “Department”), Division of Waste Management (the “Division”). For

the following reasons, we affirm.
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Opinion of the Court

I. Background

This appeal is the result of a petition for a contested case hearing filed by

WASCO in the Office of Administrative Hearings on 27 September 2013. In the

petition, WASCO sought a declaration that it was not an “operator” of a former textile

manufacturing facility located at 850 Warren Wilson Road in Swannanoa, North

Carolina (the “Site”), and, therefore, not responsible for remedial cleanup efforts

required by federal and state laws governing the management of hazardous wastes.

Those laws include portions of the Resource Conservation and Recovery Act, as

amended (RCRA), 42 U.S.C. §§ 6901-6992, federal regulations, and North Carolina’s

Hazardous Waste Program (the “State Hazardous Waste Program”).

As the United States Supreme Court clearly explained,

RCRA is a comprehensive environmental statute that
empowers [the Environmental Protection Agency (EPA)] to
regulate hazardous wastes from cradle to grave, in
accordance with the rigorous safeguards and waste
management procedures of Subtitle C, 42 USC §§ 6921-
6934. (Nonhazardous wastes are regulated much more
loosely under Subtitle D, 42 USC §§ 6941-6949.) Under the
relevant provisions of Subtitle C, EPA has promulgated
standards governing hazardous waste generators and
transporters, see 42 USC §§ 6922 and 6923, and owners and
operators of hazardous waste treatment, storage, and
disposal facilities (TSDF’s), see § 6924. Pursuant to § 6922,
EPA has directed hazardous waste generators to comply
with handling, recordkeeping, storage, and monitoring
requirements, see 40 CFR pt 262 (1993). TSDF’s, however,
are subject to much more stringent regulation than either
generators or transporters, including a 4 to 5-year
permitting process, see 42 USC § 6925; 40 CFR pt 270

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(1993); US Environmental Protection Agency Office of
Solid Waste and Emergency Response, The Nation’s
Hazardous Waste Management Program at a Crossroads,
The RCRA Implementation Study 49-50 (July 1990),
burdensome financial assurance requirements, stringent
design and location standards, and, perhaps most onerous
of all, responsibility to take corrective action for releases of
hazardous substances and to ensure safe closure of each
facility, see 42 USC § 6924; 40 CFR pt 264 (1993).

City of Chicago v. Envtl. Def. Fund, 511 U.S. 328, 331-32, 128 L. Ed. 2d 302, 307-308

(1994).

In lieu of the federal program, RCRA allows states to develop, administer, and

enforce their own hazardous waste programs, subject to authorization by EPA. See

42 U.S.C. § 6926 (2016). State programs must meet the minimum requirements of

RCRA. Id. (requiring state programs to be “equivalent” to the federal hazardous

waste program). EPA granted North Carolina final authorization to operate the State

Hazardous Waste Program in 1984. See 49 Fed. Reg. 48694-01 (Dec. 14, 1984).

The State Hazardous Waste Program is administered by the Division’s

Hazardous Waste Section (the “Section”). See 15A N.C. Admin. Code 13A.0101(a)

(2016). The State Hazardous Waste Program consists of portions of the North

Carolina Solid Waste Management Act (the “State Solid Waste Management Act”),

Article 9 of Chapter 130A of the General Statutes, and related state rules and

regulations. Specifically, Part 2 of the State Solid Waste Management Act concerns

“Solid and Hazardous Waste Management” and requires that rules establishing a

complete and integrated regulatory scheme in the area of hazardous waste

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Opinion of the Court

management be adopted and enforced. See N.C. Gen. Stat. § 130A-294(c) (2015).

North Carolina’s Hazardous Waste Management Rules (the “State Hazardous Waste

Rules”) are found in Title 15A, Subchapter 13A of the N.C. Administrative Code. The

State Hazardous Waste Rules largely incorporate the federal regulations under

RCRA by reference.

Pertinent to the present case, the State Hazardous Waste Rules adopt closure

and post-closure standards for owners and operators of hazardous waste TSDF’s from

subpart G of the federal regulations. See 15A N.C. Admin. Code 13A.0109(h)

(incorporating by reference 40 C.F.R. §§ 264.110 through 264.120). The State

Hazardous Waste Rules also implement a hazardous waste permit program, which

incorporates much of the federal hazardous waste permit program, with added “Part

B” information requirements. See 15A N.C. Admin. Code 13A.0113 (incorporating by

reference portions of 40 C.F.R. Ch. 1, Subch. I, Pt. 270,).

40 C.F.R. § 270.1(c) is one of those sections of the federal hazardous waste

permit program incorporated by reference in 15A N.C. Admin. Code 13A.0113(a).

That section provides, in pertinent part, that

[o]wners and operators of surface impoundments, landfills,
land treatment units, and waste pile units that received
waste after July 26, 1982, or that certified closure
(according to § 265.115 of this chapter) after
January 26, 1983, must have post-closure permits, unless
they demonstrate closure by removal or decontamination
as provided under § 270.1(c)(5) and (6), or obtain an
enforceable document in lieu of a post-closure permit, as

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Opinion of the Court

provided under paragraph (c)(7) of this section. If a post-
closure permit is required, the permit must address
applicable 40 CFR part 264 groundwater monitoring,
unsaturated zone monitoring, corrective action, and post-
closure care requirements of this chapter.

40 C.F.R. § 270.1(c) (2017). It is WASCO’s responsibility to obtain a post-closure

permit for the Site that is at issue in the present case.

As mentioned above, the Site is a former textile manufacturing facility located

at 850 Warren Wilson Road in Swannanoa, North Carolina. Years before WASCO

became involved with the Site, Asheville Dyeing & Finishing (AD&F), a division of

Winston Mills, Inc., operated a knitwear business on the Site. During the operation

of the knitwear business, underground tanks were used to store virgin and waste

perchloroethylene (PCE), a dry cleaning solvent. At some point prior to 1985, PCE

leaked from the tanks and contaminated the soil. The storage tanks were excavated

by Winston Mills in 1985 and the resulting pits were backfilled with the contaminated

soil left in place.

In 1990, Winston Mills and the Section entered into an Administrative Order

on Consent that set forth a detailed plan to close the Site. Winston Mills completed

the closure plan to close the Site as a landfill in 1992 and the Section accepted

certifications of closure in a 1993 letter to Winston Mills.

Winston Mills and its parent corporation, McGregor Corporation, sold the site

to Anvil Knitwear, Inc., in 1995. In connection with the sale, Winston Mills provided

Anvil Knitwear indemnification rights for “environmental requirements.” Culligan

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Opinion of the Court

International Company (Culligan) co-guaranteed Winston Mills’ performance of

indemnification for environmental liabilities.

WASCO became involved in 1998 when its predecessor in interest, United

States Filter Corporation, acquired stock of Culligan Water Technologies, Inc., which

owned Culligan. Thereafter, WASCO provided financial assurances to the Section on

behalf of Culligan in the form of a trust fund to the benefit of the Department and an

irrevocable standby letter of credit for the account of AD&F.

WASCO divested itself of Culligan in 2004. As part of the sale of Culligan,

WASCO agreed to indemnify the buyer as to identified environmental issues at the

Site. At that time, a letter from Culligan to the Section represented that WASCO

was assuming Culligan’s remediation responsibilities at the Site and directing

further communications to WASCO’s director of environmental affairs. Subsequent

communications between WASCO and the Section show that WASCO did intend to

take on those responsibilities and that the Section identified WASCO as the

responsible party. Additionally, Part A permit applications signed by WASCO’s

director of environmental affairs identified WASCO as the operator and WASO

continued to pay consultants and take action at the Site.

In 2007, WASCO received a letter from the Section that the Site was included

on a list of facilities needing corrective action. A follow-up letter from the Section

soon thereafter indicated that additional action was needed to develop a groundwater

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Opinion of the Court

assessment plan to address the migration of hazardous waste in the groundwater.

This expanded the size of the area with which WASCO was dealing to off-site

locations. WASCO, its consultant, and the Section continued to work together to

address a groundwater plan.

In 2008, Anvil Knitwear sold the property to Dyna-Diggr, LLC. Thereafter,

responsibility for compliance with the State Hazardous Waste Program became an

issue, with both WASCO and Anvil disclaiming responsibility. WASCO asserted it

participated in post-closure actions on a voluntary basis.

In an 16 August 2013 letter, the Section detailed its positions that Dyna-Diggr

is liable as an owner and that WASCO is independently liable as an operator. The

Section sought cooperation between all parties and suggested it “would be willing to

enter into a modified Joint Administrative Order on Consent in Lieu of a Post-Closure

Permit pursuant to which the two parties agree to undertake part of the post-closure

responsibilities[.]” However, in the alternative, the Section reminded the parties that

it “always has the option of issuing a Compliance Order with Administrative Penalty

to both parties for violation of 40 CFR 270.1(c) and associated post-closure

regulations.” This action resulted in WASCO filing the 27 September 2013 petition.

Following the filing of the petition, on 25 September 2014, the Section filed a

motion for summary judgment on all claims raised in WASCO’s petition. After the

ALJ denied WASCO’s motion for a continuance regarding the summary judgment

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motion by order filed 28 October 2014, the ALJ filed his final decision granting the

Section’s motion for summary judgment on 2 January 2015.

On 2 February 2015, WASCO filed a petition for judicial review (the “PJR”) of

both orders. After both parties filed briefs regarding the PJR, the matter came on for

hearing in Wake County Superior Court on 12 October 2015 before the Honorable G.

Bryan Collins, Jr.

On 23 October 2015, the court filed its “Final Order and Judgment on Rule

56(f) Motion and Petition for Judicial Review.” The court concluded, “[a]s a matter of

law, WASCO is an operator of a landfill for purposes of the State Hazardous Waste

Program’s post-closure permitting requirement.” Therefore, the court affirmed the

2 January 2015 final decision of the ALJ granting summary judgment in favor of the

respondent and denied WASCO’s PJR. In the decretal portion of the court’s order,

the court reiterated that “WASCO is an ‘operator’ for purposes of 40 C.F.R. § 270.1(c)

(adopted by reference in 15A [N.C. Admin. Code] 13A.0113(a)) and must comply with

all attendant responsibilities and regulatory requirements.”

Wasco filed notice of appeal to this Court on 20 November 2015.

II. Discussion

The issue on appeal is whether the trial court erred in entering summary

judgment in favor of the Section on the basis that, “[a]s a matter of law, WASCO is

an operator of a landfill for purposes of the State Hazardous Waste Program’s post-

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closure permitting requirement.” WASCO contends that it is not, and has never been,

an operator of any facility at the Site.

Under the Administrative Procedure Act, when a party to a review proceeding

in a superior court appeals to the appellate division from the final judgment of the

superior court, “[t]he scope of review to be applied by [this Court] . . . is the same as

it is for other civil cases.” N.C. Gen. Stat. § 150B-52 (2015). “Our standard of review

of an appeal from summary judgment is de novo; such judgment is appropriate only

when the record shows that ‘there is no genuine issue as to any material fact and that

any party is entitled to a judgment as a matter of law.’ ” In re Will of Jones, 362 N.C.

569, 573, 669 S.E.2d 572, 576 (2008) (quoting Forbis v. Neal, 361 N.C. 519, 524, 649

S.E.2d 382, 385 (2007)).

Citing In re Appeal of N.C. Sav. & Loan League, 302 N.C. 458, 276 S.E.2d 404

(1981), WASCO asserts that in our de novo review, the Section’s interpretation of the

law is entitled to no deference. However, this Court has stated that “an agency’s

interpretation of its own regulations will be enforced unless clearly erroneous or

inconsistent with the regulation’s plain language.” Hillian v. N.C. Dep’t of Corr., 173

N.C. App. 594, 598, 620 S.E.2d 14, 17 (2005). In fact, in N.C. Sav. & Loan League,

the Court explained as follows,

[w]hen the issue on appeal is whether a state agency erred
in interpreting a statutory term, an appellate court may
freely substitute its judgment for that of the agency and
employ de novo review. Although the interpretation of a

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statute by an agency created to administer that statute is
traditionally accorded some deference by appellate courts,
those interpretations are not binding. The weight of such
[an interpretation] in a particular case will depend upon
the thoroughness evident in its consideration, the validity
of its reasoning, its consistency with earlier and later
pronouncements, and all those factors which give it power
to persuade, if lacking power to control.

302 N.C. at 465-66, 276 S.E.2d at 410 (internal citations and quotation marks

omitted). Thus, the Section’s interpretation is afforded some deference.

“Operator” is defined in various places throughout the State Solid Waste

Management Act and the State Hazardous Waste Rules. First, the general

definitions in Part 1 of the State Solid Waste Management Act define “operator” to

mean “any person, including the owner, who is principally engaged in, and is in

charge of, the actual operation, supervision, and maintenance of a solid waste

management facility and includes the person in charge of a shift or periods of

operation during any part of the day.” N.C. Gen. Stat. § 130A-290(a)(21) (2015). This

definition applies broadly to the entire State Solid Waste Management Act, including

those portions relevant to hazardous waste management. The definition’s application

to hazardous waste management is evident from the definition provision in the State

Hazardous Waste Rules, which provides that both the definition of “operator” in N.C.

Gen. Stat. § 130A-290 applies to the State Hazardous Waste Rules, see 15A N.C.

Admin. Code 13A.0102(a) (providing “[t]he definitions contained in [N.C. Gen. Stat.

§] 130A-290 apply to this Subchapter[]”), and that the definition of “operator” in 40

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C.F.R. § 260.10, “[o]perator means the person responsible for the overall operation of

a facility[,]” is incorporated by reference, see 15A N.C. Admin. Code 13A.0102(b). Yet,

most specific to the post-closure permit requirement at issue in this case, the State

Hazardous Waste Rules concerning the hazardous waste permit program incorporate

by reference Subpart A of the federal regulations providing general information about

the hazardous waste permit program, see 15A N.C. Admin. Code 13A.0113(a),

including the definitions in 40 C.F.R. § 270.2, which provides that “[o]wner or

operator means the owner or operator of any facility or activity subject to regulation

under RCRA.” 40 C.F.R. § 270.2 (2017).

In this case, the court determined WASCO was an “operator” under the two

definitions specifically dealing with hazardous waste management adopted from 40

C.F.R. §§ 260.10 and 270.2. The court, however, noted that the result would be the

same applying the definition of “operator” in N.C. Gen. Stat. § 130A-290(a)(21). In

conclusion number 42, the court explained its analysis of the definitions as follows,

[b]ased on the federally delegated nature of the State
Hazardous Waste Program, the Section’s Memorandum of
Agreement with the EPA, the fact that the obligation at
issue arises under a federal regulation – 40 C.F.R. §
270.1(c) – and not Chapter 130A, and because both parties
have identified no state case law on point and have cited to
federal law, [the court] concludes it is appropriate here to
look to federal case law and administrative EPA documents
for guidance.

The federal case law considered by the court included cases analyzing operator

liability under the Comprehensive Environmental Response, Compensation, and

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Liability Act, 42 U.S.C. §§ 9601 to 9675 (CERCLA), which, similar to the State

Hazardous Waste Rules, defines “operator” as “any person owning or operating such

facility[.]” 42 U.S.C. § 9601(20)(A) (2016). Specifically, the court looked to United

States v. Bestfoods, 524 U.S. 51, 141 L. Ed. 2d 43 (1998), in which the Court explained

that,

under CERCLA, an operator is simply someone who directs
the workings of, manages, or conducts the affairs of a
facility. To sharpen the definition for purposes of
CERCLA’s concern with environmental contamination, an
operator must manage, direct, or conduct operations
specifically related to pollution, that is, operations having
to do with the leakage or disposal of hazardous waste, or
decisions about compliance with environmental
regulations.

Id. at 66-67, 141 L. Ed. 2d at 59. The court in the present case then concluded that

“[c]onsistent with Bestfoods and its progeny, . . . post-closure operatorship is based on

an examination of the totality of the circumstances.”

On appeal, WASCO’s first contention is that the court erred in basing its

decision exclusively on CERCLA without considering the elements of the operator

definition in N.C. Gen. Stat. § 130A-290(a)(21). WASCO contends that the definition

in N.C. Gen. Stat. § 130A-290(a)(21) sharpened the definition of operator for purposes

of the State Solid Waste Management Act and, citing R.J. Reynolds Tobacco Co. v.

N.C. Dep’t of Environment & Natural Resources, 148 N.C. App. 610, 616, 560 S.E.2d

163, 167-68 (looking to the plain meaning of N.C. Gen. Stat. § 130A-290(35) and

determining that tobacco scrap, stems, and dust did fall within the definition of “solid

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waste”), disc. review denied, 355 N.C. 493, 564 S.E.2d 44 (2002), contends the

definition in N.C. Gen. Stat. § 130A-290(a)(21) is controlling over other definitions to

the extent the definitions differ. Thus, WASCO contends to be an operator, it must

be “principally engaged in, and is in charge of, the actual operation, supervision, and

maintenance of a solid waste management facility[.]” N.C. Gen. Stat. § 130A-

290(a)(21).

We are not persuaded by WASCO’s arguments that the court is limited to an

analysis of the definition of “operator” in N.C. Gen. Stat. § 130A-290(a)(21).

Moreover, we note that it is clear the court did not look exclusively to CERCLA, but

instead looked to CERCLA only for guidance on how to interpret the definitions of

operator in the State Hazardous Waste Rules adopted from the federal regulations.

Despite differences in the framework of RCRA and CERCLA, the definitions of

“operator” in both acts are similar and CERCLA case law does provide persuasive

guidance. Furthermore, and not contested by WASCO on appeal, the court also

looked to EPA documents providing guidance on RCRA and concluded that those

documents support the conclusion that WASCO was an operator.

We hold the court was correct to look for guidance in federal law while

interpreting the term “operator” in the context of the State Hazardous Waste Rules

and, specifically, the hazardous waste permit program. Those portions of the State

Hazardous Waste Rules deal specifically with the post-closure permit requirement at

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issue in the present case. See 40 C.F.R. § 270.1(c) (incorporated by reference in 15A

N.C. Admin. Code 13A.0113(a)). In contrast, the terms of N.C. Gen. Stat. § 130A-

290(a)(21) make clear that the definition of operator therein is for an operator of any

“solid waste management facility.” Although that definition is more detailed than

the definitions in the State Hazardous Waste Rules, that definition was intended to

apply to the management of all solid wastes, not just the control of hazardous wastes

of a facility post-closure.

Nevertheless, although the three definitions of “operator” applicable to the

State Hazardous Waste Program differ slightly, the definitions seem to be in accord

that, in general terms, an “operator” is the person responsible for, or in charge of, the

facility subject to regulation. In the present case, that facility is the pit that was

certified closed as a landfill in 1993.

WASCO’s next contention on appeal is that the court erred in holding that

WASCO was an operator even though WASCO did not become involved with the Site

until after the Site was certified closed by the Section. Citing N.C. Gen. Stat. § 130A-

290(a)(2), which defines “closure” to mean “the cessation of operation of a solid waste

management facility and the act of securing the facility so that it will pose no

significant threat to human health or the environment[,]” WASCO asserts that it is

impossible to operate a facility that has ceased operation. Thus, WASCO contends it

cannot be an operator of the Site.

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WASCO, however, recognizes that both RCRA and the State Hazardous Waste

Program impose duties on operators to provide post-closure care, but contends that

those duties can only be imposed on those owning and operating the facility before

the time that the facility ceases to operate. WASCO asserts that the Section has

created the concept of “post-closure operator” for purposes of this case without any

basis in the law. Again, we disagree with WASCO’s arguments.

As the Section points out, and as we noted above,

[o]wners and operators of . . . landfills . . . must have post-
closure permits, unless they demonstrate closure by
removal or decontamination as provided under §
270.1(c)(5) and (6), or obtain an enforceable document in
lieu of a post-closure permit, as provided under paragraph
(c)(7) of this section.

See 40 C.F.R. § 270.1(c) (incorporated by reference in 15A N.C. Admin. Code

13A.0113(a)).

In this case, the pit where the underground storage tanks were located on the

Site was not designated a landfill for purposes of the State Hazardous Waste Program

until the time that it was closed with hazardous waste in place, after the time the

facility ceased to operate. See 40 C.F.R. § 265.197(b) (incorporated by reference in

15A N.C. Admin. Code 13A.0110(j)). Thus, there were no “operators” of a landfill

when the facility was in operation, as WASCO limits the term. Yet, the hazardous

waste permit program clearly applies to operators of landfills and those facilities

closed as landfills.

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Moreover, although the definition of “closure” cited by WASCO is clear that the

closure of a solid waste management facility is the time it ceases to operate, that

definition also makes clear closure includes the act of securing the facility to prevent

future harm. Thus, it is not just those parties in charge of the actual operation of a

solid waste management facility that are subject to the post-closure permitting

requirement.

Guided by the same federal law relied on by the trial court, including Bestfoods,

its progeny, and EPA documents, we hold “operator,” as it is defined in the State

Hazardous Waste Rules, includes those parties in charge of directing post-closure

activities under the State Hazardous Waste Program and RCRA.

In the present case, the trial court issued detailed findings as to WASCO’s

involvement at the Site that demonstrate it was the operator for purposes of the post-

closure permitting requirement. WASCO does not challenge the factual findings, but

instead asserts arguments that those findings do not lead to the conclusion that it is

an operator as that term is defined in N.C. Gen. Stat. § 130A-290(a)(2). We are not

convinced by WASCO’s arguments.

The court’s pertinent findings, which this Court has reviewed and determined

to be supported by the documentary exhibits, are as follows:

15. WASCO became involved with the Facility in a limited
capacity following its 1998 acquisition of Culligan
Water Technologies, Inc. and its affiliate, Culligan
International Company (“Culligan”).

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16. At the time WASCO acquired Culligan, Culligan had
been performing post-closure operations related to the
Facility.

17. Between 1999 and 2004, Petitioner provided financial
assurance to the Section on behalf of Culligan for post-
closure care associated with the Facility, including a
Trust Agreement and Irrevocable Standby Letter of
Credit in 2003.

18. The Culligan Group, including Culligan, was divested
from WASCO in 2004 in a $610-million transaction
that included WASCO’s agreement to indemnify
Culligan’s buyer “as to certain matters associated at
the Facility as they relate to specific Culligan
obligations.”

19. Following the 2004 divestiture, Culligan represented
in a letter to the Section that WASCO was “assuming
responsibility” for the Facility. The letter indicated
that copies were transmitted to John Coyne, the
Director of Environmental Affairs for WASCO.

20. The Section followed-up with Mr. Coyne by email,
referencing Culligan’s representation that WASCO “is
now responsible for RCRA issues” at the Facility, and
asking for WASCO to complete a new Part A permit
application as the Facility’s operator.

21. Mr. Coyne responded that (a) he was “very familiar
with this project,” (b) he would “attend to the Part A
application in the very near future,” and (c) WASCO
“intend[ed] on keeping the same consultants . . . and
doing everything else we can to maintain continuity
and keep the project headed in the right direction.”

22. An updated Part A permit application was submitted
to the Section in December 2004 naming WASCO as
operator. Mr. Coyne signed the Part A permit

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application for WASCO “under penalty of law” as to
the truth of its contents.

23. Mr. Coyne signed another updated Part A “under
penalty of law” in 2006, which was submitted to the
Section and continued to identify WASCO as operator.

24. Rodney Huerter—who had assumed the role of
WASCO’s Director of Environmental Affairs after Mr.
Coyne—signed a third Part A permit application
“under penalty of law” in 2008, which was submitted
to the Section and which again identified WASCO as
the Facility’s operator.

25. After the divestiture of Culligan, WASCO continued
to provide financial assurance for the Facility under
the 2003 Trust Agreement, Standby Trust Fund, and
Irrevocable Standby Letter of Credit, which it
amended in the Section’s favor for inflation 10 times
between the divestiture of Culligan and the initiation
of the 2013 contested case. WASCO has
communicated directly with the Section throughout
this time period concerning financial requirements for
the Facility.

26. The language of the Trust Agreement identifies
WASCO as the “Grantor,” and the agreement’s
purpose to “establish a trust fund . . . for the benefit of
[the Department].” Specifically, the Trust Agreement
recites that:

. . . “DENR” . . . has established certain regulations
applicable to the Grantor, requiring that an owner
or operator of a hazardous waste management
facility shall provide assurance that funds will be
available when needed for closure and/or post-
closure care of facility. . . .

The Trustee shall make payments from the fund as
the Secretary of [the Department] . . . shall direct,

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in writing, to provide for the payment of the cost of
closure and/or post-closure care of facilities covered
by this agreement . . . .

“this Trust shall be irrevocable and shall continue
until terminated at the written agreement of the
Grantor, the Trustee, and the Secretary . . .”

27. The Irrevocable Standby Letter of Credit, as amended,
is subject to automatic renewal in one-year
increments unless cancelled by the bank.

28. The most recent amendment to the Irrevocable
Standby Letter of Credit submitted prior to the filing
of the contested case is in the amount of $443,769.88.

29. Internal WASCO communications concerning
financial assurance reference “the
statutory/regulatory requirements relating to one of
our environmental legacy sites in Swannanoa, NC.”

30. After the divestiture of Culligan, WASCO entered into
a Master Consulting Services Agreement with
Mineral Springs Environmental, P.C. (“Mineral
Springs”) for Mineral Springs to perform work at the
Facility.

31. A total of 51 invoices from Mineral Springs to WASCO
shows that Mineral Springs or its subcontractors
performed a variety of post-closure activities at the
Facility or related to the Facility, between November
2004 and August 2013, which fell into the following
categories:

- operation and maintenance of an air sparge/soil
vapor extraction groundwater remediation
system, including use of a subcontractor for
supplies such as air filters, oil filters, oil, and
separators;

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Opinion of the Court

- groundwater sampling and analysis, including
use of laboratory subcontractors;

- preparation of quarterly and semi-annual
reports analyzing sampling results;

- project management;

- assessment of two potential sources of
contamination at the Facility in addition to the
former tank site—specifically, an old dump site
and a French drain—including use of an
excavation subcontractor and a bush hog
subcontractor; and

- payment of utility bills based [on] one meter
labeled as “pump” and one meter labeled as
“environmental cleanup.”

32. Mr. Coyne or Mr. Huerter personally approved
payment to Mineral Springs for work in the above
categories, and approved payment directly to the
utility company for additional bills, totaling
$235,984.43.

33. In particular, Mineral Springs submitted 33 reports
associated with the invoiced post-closure activities to
the Section on WASCO’s behalf between February
2005 and May 2013, including 16 groundwater
monitoring reports that expressly identified WASCO
as the “responsible party for the site.”

34. The Section communicated directly with WASCO, or
with both WASCO and Mineral Springs, in numerous
matters related to environmental compliance,
including but not limited to requests for preparation
of a work plan for the investigation of the former dump
site and French drain, and responses to Mineral
Springs’s monitoring reports.

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Opinion of the Court

35. After Mineral Springs and/or its sub-contractors
performed the French drain and dump assessment but
before drafting the Assessment Report, Kirk Pollard
of Mineral Springs notified Mr. Huerter of
preliminary findings concerning the volume and
nature of drums discovered. Mr. Pollard identified
liquid in one drum that tested at a pH of 14, which is
considered hazardous based on corrosivity. Mr.
Pollard expressed concern for health and safety,
recommended that Mr. Huerter notify the Section,
and expressed his belief that an immediate response
and a more thorough evaluation could be necessary.
No such concerns are reflected in the final report.

36. Mr. Huerter instructed Mr. Pollard not to remove “any
of the drums, containers, or anything else,” and asked
to conduct an “advanced review” of the dump
Assessment Report before its submission to the
Section. Mr. Huerter commented on Mr. Pollard’s
first draft, including by providing two “reviewed and
revised blackline document[s].”

37. Additional communications between Mr. Huerter and
Mr. Pollard included (a) Mr. Pollard’s requests for Mr.
Huerter’s guidance or authorization on matters
related to the Facility, including changes to a Part A
form, communications with the property owner,
whether groundwater sampling should continue, and
whether to advise the Section about the sale of the
property; (b) Mr. Pollard’s practice of updating Mr.
Huerter, copying him on communications with the
Section, or forwarding such communications to him;
and (c) Mr. Huerter’s requests for copies of utility bills
to compare with Mineral Springs’s invoices, and
annual cost projections.

(Citations and footnote omitted).

It is clear that the pit at the Site that was certified closed as a landfill in 1993

is subject to post-closure regulation under the State Hazardous Waste Program and

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Opinion of the Court

RCRA. Considering the above facts, we hold WASCO was the party responsible for

and directly involved in the post-closure activities subject to regulation. Even under

the definition of operator in N.C. Gen. Stat. § 130A-290(a)(21), when that definition

is viewed through the lens of post-closure regulatory activities at issue in this case,

since 2004, WASCO has been the party principally engaged in, or in charge of the

post-closure operation, supervision, and maintenance of the Site for purposes of the

hazardous waste permit program. WASCO’s arguments to the contrary are

overruled.

III. Conclusion

For the reasons stated above, we hold WASCO is an operator of a landfill for

purposes of the post-closure permitting requirement at the Site. Therefore, we affirm

the final order and judgment of the trial court.

AFFIRMED.

Judges STROUD and ZACHARY concur.

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