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Judge finds Minnesota regulators largely followed rules on key PolyMet permit, despite efforts to avoid bad press

The ruling comes out of a lawsuit brought by a coalition of environmental nonprofits and the Fond du Lac Band of Lake Superior Chippewa, which had accused the Minnesota Pollution Control Agency of trying to bend rules to suppress criticism from the Environmental Protection Agency.

Judge John Guthmann
Judge John Guthmann shown presiding over an evidentiary hearing regarding “procedural irregularities’’ in the PolyMet permit case on Tuesday, January 21.
Pool photo by Leila Navidi/Star Tribune

A Ramsey County District Court judge on Thursday said Minnesota regulators wrongly deleted some public records and tried to shield federal critiques of a key permit for the PolyMet copper-nickel mine to avoid bad press — but largely did not break permitting rules or systematically try to hide evidence of their actions.

“The Court finds no overarching effort by the [Minnesota Pollution Control Agency] to keep evidence out of the administrative record,” wrote Judge John H. Guthmann in a 104 page opinion.

The ruling is the result of a rare trial in which a coalition of environmental nonprofits and the Fond du Lac Band of Lake Superior Chippewa accused the MPCA of trying to bend rules to suppress criticism from scientists at the federal Environmental Protection Agency and hide the evidence by deleting records.

The district court proceeding was ordered by the Minnesota Court of Appeals, which is overseeing a bigger legal challenge to whether the permit, which covers the release of pollution into rivers, lakes, streams and wetlands, is adequate to protect water. It was the final state permit PolyMet Mining needed to start construction when issued in December of 2018.

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If built, PolyMet would be the first mine of its kind in the state. The company, which is owned primarily by the Swiss mining giant Glencore, promises 360 direct jobs and plans to extract copper, nickel, platinum, cobalt and other metals at an open-pit mine near Hoyt Lakes for 20 years.

Still, the controversial project has been challenged repeatedly by opponents who say copper-nickel mining could result in toxic water pollution of the St. Louis River watershed and Lake Superior, though PolyMet maintains it can safely extract the metals.

How did we get here?

In order to build its $1 billion mine near Hoyt Lakes, PolyMet needs a swath of permits issued by the state and federal government. All were granted after roughly 15 years of review, though some have since been suspended or reversed by courts.

The permit at issue in district court is known as a National Pollutant Discharge Elimination System permit, or NPDES. The MPCA handles and writes this permit, though the EPA reviews it to make sure it doesn’t violate the federal Clean Water Act. Federal regulators can make recommendations for changes, and also can veto the final permit.

The EPA did have concerns with a draft version of the permit, including that limits on pollutants like mercury and heavy metals set by the MPCA may not be federally enforceable. Criticisms like those are often shared, and made public, during a comment period held as the permit is developed. But the MPCA asked the feds to share those concerns after the public comment period, effectively shielding them. The MPCA had never made such a request before.

Leftover structures from an old LTV Steel taconite facility
MinnPost photo by Walker Orenstein
Leftover structures from an old LTV Steel taconite facility that PolyMet hopes to refurbish and reuse for the copper-nickel mine it plans to build.
The state contends it planned to change its draft permit after a deluge of public comments from outside groups like environmental nonprofits. So the agency said it wanted the EPA feedback later on, in part to avoid addressing overlapping criticisms. Shannon Lotthammer, who was an assistant MPCA commissioner at the time, testified in January that the state was “simply requesting that EPA consider allowing us to provide the updated work product before they weighed in with their formal comments.”

The feds did hold off on making written comments and ultimately did not veto the final product. The EPA did, however, read some criticism to the MPCA over the phone.

Eventually, the federal critiques and the MPCA’s request came to light through leaks and tips to the environmental group WaterLegacy, as well as through lawsuits and records requests by the nonprofit.

Environmental groups and the Fond du Lac Band argued that the state’s request was actually an unprecedented effort to hide the federal concerns from public scrutiny and keep the opinion of career scientists and regulators out of an administrative record that details how a permit was issued. Kevin Pierard, a longtime EPA official who worked on the project but has since retired, also testified under oath that the MPCA wanted to keep critiques out of the public comment period in part because they would “create a good deal of press.”

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Environmental nonprofits also obtained records from federal employees that showed the effort to delay comments that had been destroyed by MPCA employees. The MPCA argued it did not break open record laws.

How did the judge rule?

The outcome of the case largely favored the MPCA. Guthmann found that while the MPCA did ask the EPA to delay its comments, this was not a “procedural irregularity.” 

There is nothing in statute, rules or regulations that prohibit the MPCA from making such a request, or prohibit the EPA from agreeing to it, Guthmann wrote. The EPA could still have issued formal written critiques during the public comment period and ultimately chose not to. While environmental groups have portrayed that decision as a political one influenced by pro-industry Trump appointees, Guthmann said the EPA’s motives were ultimately irrelevant to his decision on the actions of the state.

Darin Broton
Darin Broton
“With today’s decision, the court renewed its confidence in the MPCA’s permitting process for PolyMet,” said MPCA spokesman Darin Broton in a written statement. “While the MPCA always strives to do better, the court overwhelmingly said the agency’s permitting procedures were not irregular. The MPCA remains committed to ensuring that its permit processes and decision-making are transparent and provide a robust opportunity for public participation.”

John Cherry, PolyMet’s chairman, president and CEO, said the company is “pleased with the district court’s ruling and look forward to defending the challenge to the water permit currently pending in the court of appeals.”

“We remain confident the water quality permit meets all applicable stands and will ultimately be upheld by the courts,” Cherry said.

The judge did note that the MPCA’s “primary motivation” to delay official written EPA comments was a belief that “there would be less negative press” about the PolyMet project if the critiques were only relayed to the agency by phone and then addressed in a draft permit.

Pete Marshall, a spokesman for the Friends of the Boundary Water Wilderness, said: “Environmental protections aren’t in place and shouldn’t be able to be bent in order to more perfectly shape a public relations campaign.”

Guthmann also found that the MPCA largely complied with rules and laws governing public records, keeping pertinent evidence of its agreement with the EPA to delay making public comments. “If there was a general strategy by the MPCA to suppress public knowledge of the March 2018 agreement with the EPA, it did not do a very good job,” Guthmann wrote.

Still, Guthmann did find two instances in which the state departed from regular procedure when issuing the NPDES permit. 

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The MPCA wrongly deleted emails, including from then-commissioner John Linc Stine asking the EPA to delay its comments. These documents were only made public when EPA employees leaked them to WaterLegacy. Guthmann said if the emails had not been destroyed, the MPCA would have been required to disclose them as public records.

And Guthmann said the MPCA failed to put a timely “litigation hold” on records to preserve them for court challenges. Guthmann said these actions were, “at best,” the results of “poor training and careless management of the potential administrative record.”

Ultimately, Guthmann still declined to sanction the state for “spoliation,” or wrongful destruction of evidence. He said since PolyMet opponents were able to find missing documents through other means, they could not prove in court that their legal case was harmed by the state’s actions or missing evidence. “There is no spoliation when the documents at issue were not actually destroyed,” Guthmann said. “Spoliation sanctions are not designed to punish failed attempts to destroy evidence, whether accidental or otherwise.”

What does the ruling mean?

The case will now be transmitted back to the Court of Appeals, which can take the ruling into consideration when deciding if the NPDES permit is too weak or otherwise breaks state law.  (The legal challenge to PolyMet is just one of several pending before the courts right now, and the NPDES permit remains suspended.)

Paula Maccabee
Paula Maccabee
Paula Maccabee, attorney for WaterLegacy, said she plans to challenge Guthmann’s ruling in the Court of Appeals because she believes the judge had too narrow a view of what should be considered irregular permitting procedures.

While the MPCA said the ruling vindicated their agency’s handling of the NPDES, Maccabee also said it was rare and possibly unprecedented for a judge to find any irregularities in the state’s permitting actions. “That is very important, not just for the PolyMet case, but for the idea that government agencies can be accountable,” she said.