By TIM CARPENTER
Kansas Reflector
TOPEKA — The Kansas Supreme Court must arbitrate conflict sparked by a cunning Kansas regulatory maneuver to expand concentrated swine feeding operations and the response of an environmental organization claiming state regulators embraced legal fiction to weaken surface water protections.
The Sierra Club won a lawsuit four years ago in Shawnee County District Court challenging farmer Terry Nelson and his partners for sidestepping maximum limits on the number of hogs packed into a single location near a creek. The Kansas Department of Health and Environment had collaborated with the Nelson family to add about 2,400 hog units at a farm in Phillips County.
The population surge was accomplished when the Nelsons were allowed by KDHE to draw a property line down the middle of an existing hog production facility to create two limited liability companies. Approval of two permits allowed the Nelson hog operation to surge capacity without moving facilities a greater distance from open water.
The Nelsons asked the Kansas Court of Appeals to reverse the district court’s decision against him. That led to an appellate ruling declaring the Sierra Club didn’t have standing to sue the Nelsons.
Neither side was satisfied with the Court of Appeals’ findings, and the Supreme Court heard oral argument Friday with the Sierra Club seeking reinstatment of the district court’s decision the KDHE permits were unlawful. The Nelsons’ attorney urged the justices to order the district court to nullify its previous rulings and summarily dismiss the case.
A ‘legal fiction’
“This is a case about whether the Sierra Club has the right to protect the waters of Kansas when an agency fails to enforce the law to protect it,” said Sierra Club counsel Tim Laughlin. “Sierra Club would not be before this court today if KDHE had done its job. The real issue here is the legal fiction that KDHE created.”
It’s a complicated narrative involving influential Kansas farm and livestock organizations backing Nelson’s attempt to secure KDHE consent for placement of 6,154 hog units — up from 3,724 — at side-by-side properties owned by separate LLCs to avoid deeper setbacks from surface water. The Nelsons accomplished this by dividing ownership of a hog facility between himself and his relatives. By operating as distinct entities for permitting purposes, a 250-foot setback remained in place rather than KDHE requiring a 500-foot setback in conjunction with the surge in hogs at the location.
“There is not an artiface,” said attorney Clayton Kaiser, representing the Nelsons. “We don’t believe that this is some sort of a loophole because that presumes there is something we’re trying to get around. It’s not.”
The Supreme Court’s seven justices took the case under advisement and planned to issue a decision at a later date.
Justice Melissa Taylor Standridge said she was struck by the Nelson family’s ability to expand its Husky Hogs facility through a simple division of farm property.
“Basically what’s happened here is, you know, Husky Hogs couldn’t get it approved when it was one facility,” Standridge said. “So, it’s kind of like taking advantage of a tax loophole — ‘Well, we’ll go around it and do it this way. We’ll make two facilities.'”
Justice Caleb Stegall raised procedural questions about why the high court was asked to dive into the KDHE permitting debate on the Husky Hogs-Prairie Dog Pork operation. The case also involves the family’s Rolling Hills Pork-Stillwater Swine operation, which were similarly divided to boost concentration of hogs.
Stegall noted the Sierra Club, KDHE and the Nelson family were currently engaged in a new lawsuit on propriety of amended confined hog permits granted by KDHE, but those revised permits were due to expire this spring. The Nelsons’ LLCs initiated the process to obtain new permits.
Stegall appeared to find logic in KDHE’s decision to address legal questions about the contiguous ownership boundary of the side-by-side hog facilities. A narrow sliver of land between the two halves at the Nelson properties was transferred to a third party called Nelson Farms Inc.
“The fix to the common border was to say, ‘Okay fine. We will deed a strip of land that’s not part of either facility,'” Stegall said.
Why special rules?
Laughlin, arguing on behalf of the Sierra Club, said both the original and modified permits from KDHE allowed for an animal unit population at Nelson family hog facilities that exceeded the 3,724-unit limit for a 250-foot setback. Laughlin said anything over 3,724 should have required a 500-foot setback from water.
It’s uncontested Prairie Dog Pork was within Husky Hogs’ original permit boundary. It also was uncontested that once Prairie Dog Pork was inserted into that boundary, the number of pigs at the side-by-side facilities climbed from 3,704 units to 6,154 units. If a hog producer had previously sought a KDHE permit for 6,154 units within 250 feet of water surfaces, it would have been denied based on state law establishing a 500-foot setback, Laughlin said.
“Whether it’s the original permits or the modified permits, they both suffer the same flaw,” Laughlin said. “They’re both cut from the same common thread, and that is a manipulation of the setback distances.”
Kaiser said applicable Kansas law and KDHE regulation focused on the number of animal units in a facility and the distance between hog waste management systems and surface water. He told justices a problem with the Sierra Club’s position was state law said nothing about hog facility ownership or how many legally separate hog facilities could be carved into a piece of agriculture ground.
“Should we have some sort of special rules that apply to swine facilities versus every other type of real property issue that can arise in a state?” he said. “The answer is: ‘No.' ”