Mayor and City Council of Baltimore v. New Pulaski Co. Ltd. P'ship

DAVIS, Judge. On January 5, 1996, the Circuit Court for Baltimore County issued a judgment declaring City of Baltimore Ordinance No. 128 of the 1992 Councilmanic Session preempted by State environmental laws. The court granted summary judgment in favor of appellee The New Pulaski Company Limited Partnership, and the Mayor and City Council of Baltimore appealed. ²²¹ The principal issue presented for our review is restated as follows: Whether Ordinance No. 128 is preempted by State environmental laws. FACTS The New Pulaski Company Limited Partnership (Pulaski) owns and operates a solid waste incinerator (Incinerator) located on Pulaski Highway in Baltimore City.

Baltimore City (City) built the Incinerator in 1956 and owned and operated it until 1981 when the City sold the Incinerator to Pulaski. Pulaski and the City entered into a Waste Disposal Service Agreement (WDSA) on May 6,1981 for a term of fifteen years whereby Pulaski would dispose of municipal waste. In addition, the City retained three five-year options to renew the WDSA. Upon expiration of the WDSA, Pulaski would own the Incinerator for the remaining period of a fifty-year Ground Lease and be responsible for operating costs.

During the term of the WDSA, however, the City was responsible for one hundred percent of the operating, maintenance, and improvement costs. In 1985, the WDSA was amended to reduce the City’s responsibility to eighty-five percent of the costs and to permit Pulaski to build a fifth furnace at the Incinerator. In January 1993, Pulaski and the Maryland Department of the Environment (MDE) entered into a Consent Order to establish a compliance schedule for the Incinerator’s air emissions. On May 11, 1994, MDE issued another Order to Pulaski directing Pulaski to take remedial action to bring the air quality emissions of the Incinerator into compliance with the air pollution laws and regulations.

The City estimated that in order to bring the Incinerator into compliance, the cost of retrofitting the Incinerator would be $60-$100 million. According to the WDSA, Pulaski was required to notify, and obtain approval from, the City for all improvements to the Incinerator. In a May 8, 1992 letter from George G. Balog, the Director of the Department of Public Works (Director or Public Works), the City stated that it was not “practical or ²²² technically competent to take any action to retro-fit” the Incinerator, and the City would not reimburse Pulaski for any expenses taken to retrofit the Incinerator. Based on the Director’s assessment, Pulaski recommended that a new solid waste, waste-to-energy facility be built.

Pulaski claims that public opposition to the proposed waste-to-energy facility existed, and as a result, Bill No. 54, which places a moratorium on new incinerators, was introduced at a session of the City Council. On July 18, 1992, Bill No. 54 passed and became effective on August 7,1992 as Ordinance No. 128 (the Moratorium). The Moratorium prohibits the construction, reconstruction, replacement, and expansion of incinerators within Baltimore City for a period of at least five years. If the City does not reach its goal of recycling forty percent of its solid waste by 1997, the Moratorium will automatically be renewed for another five years or until the City reaches its recycling goal.

The ostensible purpose of the Moratorium, provided in § 1 of the law, is to allow the development and implementation of environmentally sound alternatives to burning solid waste, such as recycling, source reduction, and composting. The Moratorium also states that developing these alternatives will help the State achieve its mandated recycling goals and benefit the health and welfare of the residents of Baltimore City. The Moratorium provides a narrow exemption to the ban on incinerators “if the Director of Public Works certifies in a written report ... that- such construction, replacement or expansion is necessary to serve the public interest in the efficient, economic, safe and environmentally sound disposal of solid waste, the City Council by ordinance may approve such construction,- reconstruction, replacement or expansion.” The Moratorium also provides in § 3b that “[njothing contained herein shall abrogate any permittee’s responsibility to comply with local, state or federal laws relating to pollution controls and any construction, reconstruction, improvement or replacement necessarily associated therewith.” ²²³ Thus, Pulaski sought certification to construct a new incinerator from Balog. On May 5, 1994, Balog certified to the City Council that it was his opinion that the new Pulaski incinerator was necessary to serve the public interest in the efficient and environmentally sound disposal of solid waste.

Bill No. 846 was introduced in the City Council to lift the Moratorium for Pulaski, but it was not approved. Pulaski, believing that the City’s actions in refusing to pay to retrofit the Incinerator and banning construction of a replacement incinerator deprived Pulaski of “any realistic means of complying with the MDE Orders,” sued the City in December 1993 for breach of the WDSA and for illegally enacting the Moratorium. Pulaski voluntarily withdrew its complaint in January 1994. The parties entered into a Settlement Implementation Agreement (SIA) on May 3, 1996 that terminated the WDSA.

The SIA relieved the City of its obligation to pay eighty-five percent of the operating costs and extended Pulaski’s ground lease until 2071. On June 23,1995, Pulaski brought an action for declaratory judgment in the Circuit Court for Baltimore County to strike down the Moratorium. In accordance with Md.Code Ann., Envíe. § 9-503, on July 21, 1995, the City submitted its 1994-2004 Solid Waste Management Plan (SWMP) to MDE. The SWMP states the City’s goals and plans for solid waste management.

In the SWMP, reference is made to the Moratorium. MDE approved the SWMP on October 18, 1995, finding that the plan satisfies MDE’s requirements and guidelines as stated in COMAR 26.03.03. On December 22, 1995, the lower court granted summary judgment in favor of Pulaski with respect to its action for declaratory judgment, and concluded that “the Moratorium is preempted by state law.” The court did not decide any of the other grounds raised by Pulaski for invalidating the Moratori ²²⁴ um. 1 The trial court entered a declaratory judgment on January 5, 1996, declaring the Moratorium null and void. The City appeals from the lower court’s judgment.

DISCUSSION The only issue that the City raises on appeal is whether the Moratorium is preempted by State law. The amicus curiae, 2 however, raises two additional issues: 1) whether the trial court lacked jurisdiction to issue a declaratory ruling because Pulaski released the right to bring this action in the SIA; and 2) whether the trial court lacked jurisdiction to declare the moratorium void because Pulaski failed to exhaust its administrative remedies. The trial court decided these issues in favor of Pulaski on summary judgment. As a general rule, we do not consider an issue raised by an amicus if no party to the case, raises it.

Eagle-Picker Industries, Inc. v. Balbos, 326 Md. 179 , 231 n. 15, 604 A.2d 445 (1992); Md-Nat’l Cap. P. & P. Comm’n v. Crawford, 307 Md. 1 , 15 n. 6, 511 A.2d 1079 (1986). When, however, the matters raised by the amicus relate to primary jurisdiction and exhaustion of remedies, there is an exception to this rule, and we address those issues nostra sponte when appropriate. Id.

Whether Pulaski released its right to bring this action is an affirmative defense pursuant to Md. Rule 2-323(g) (1996). Thus, we do not review the issue of release because it is not an issue of primary jurisdiction and was not raised by the City on appeal. We, however, will address the exhaustion of remedies issue raised by the amicus. ²²⁵ We hold that the trial court had proper jurisdiction to declare the Moratorium void. Pulaski exhausted any administrative remedies available to it, pursuant to the Moratorium, by seeking certification from the Director of Public Works and approval from the City Council for the new incinerator.

The amicus argues that the City should have sought a declaratory ruling from MDE on the Moratorium before seeking judicial review, pursuant to Md.Code Ann., State Gov’t §§ 10-304, 10-305 (1995). The amicus also asserts that Pulaski should have requested that MDE amend the SWMP to include a new incinerator pursuant to its authority under Md.Code Ann., Envir. § 9-503 (1996). The exhaustion rule requires that “where a statute provides a special form of remedy the plaintiff must use that form of remedy rather than any other.” Soley v. State Comm’n on Human Relations, 277 Md. 521, 526 , 356 A.2d 254 (1976). Neither of the statutes cited by the amicus requires Pulaski to pursue any remedy with MDE before seeking judicial relief.

Section 10-304 states that “[a]n interested person may submit to a unit a petition for a declaratory ruling with respect to the manner in which the unit would apply a regulation or order of the unit....” Md.Code Ann., State Gov’t § 10-304. The Moratorium and the SWMP are not orders or regulations of MDE. In addition, although Md.Code Ann., Envir. § 9-503 gives MDE the authority to compel a county to amend its SWMP’s, it does not provide a means of remedy for Pulaski. Pulaski sought the only “special form” of remedy available to it under the Moratorium, which was to seek an exemption to the ban on incinerators by applying to the Director of Public Works for a certification and seeking the approval of the City Council.

In addition, the amicus contends that Pulaski’s claims were not justiciable because Pulaski had not submitted to MDE or the City a detailed plan to build a new incinerator, and thus, there is no actual claim or controversy. We disagree. We are not required, nor should we use our judicial ²²⁶ discretion, to “refuse a declaratory judgment merely because it may be preliminary to further litigation, if it terminates and decides the particular legal question at issue.” Kronovet v. Lipchin, 288 Md. 30, 59 , 415 A.2d 1096 (1980) (citing Commissioners of Cambridge v. Eastern Shore Public Serv. Co., 192 Md. 333, 341 , 64 A.2d 151 ).

Thus, the trial court had jurisdiction to determine whether the Moratorium was null and void. We now turn to the City’s only issue on appeal: whether the Moratorium is preempted by State environmental laws. The Court of Appeals stated the doctrine of preemption as follows: The doctrine of pre-emption [sic] is grounded upon the authority of the General Assembly to reserve for itself exclusive dominion over an entire field of legislative concern. When properly invoked, the doctrine precludes local legislative bodies from enacting any legislation whatsoever in the pre-empted [sic] field.

Pre-emption [sic] may be accomplished either expressly by statutory language prohibiting local legislation, ... or impliedly, by other unequivocal conduct of the General Assembly____ In either case, the focus of the inquiry must be on whether the General Assembly has manifested a purpose to occupy exclusively a particular field. Ad+Soil, Inc. v. County Comm’rs, 307 Md. 307, 324 , 513 A.2d 893 (1986) (citations omitted). In addition, the Court has considered secondary factors in determining whether preemption by implication exists: 1) whether local laws existed prior to the enactment of the state laws governing the same subject matter; 2) whether the state laws provide for pervasive administrative regulation; 3) whether the local ordinance regulates an area in which some local control has traditionally been allowed; 4) whether the state law expressly provides concurrent legislative authority to local jurisdictions or requires compliance with local ordinances; 5) whether a state agency responsible for administering and enforcing the state law has recognized ²²⁷ local authority to act in the field; 6) whether the particular aspect of the field sought to be regulated by the local government has been addressed by the state legislation; and 7) whether a two-tiered regulatory process existing if local laws were not pre-empted [sic] would engender chaos and confusion. Allied Vending, Inc. v. Bowie, 332 Md. 279, 299-300 , 631 A.2d 77 (1993) (citations omitted) (the State licensing scheme for cigarette vending machines preempted local ordinances regulating the placement of vending machines).

In the case at bar, the court found the Moratorium impliedly preempted by Maryland’s environmental statutory schemes under Md.Code Ann., Envik. § 9 and related regulations, and granted summary judgment in favor of Pulaski. The standard of appellate review of a grant of summary judgment is whether the trial court was legally correct. Beatty v. Trailmaster Prods., Inc., 330 Md. 726, 737 , 625 A.2d 1005 (1993) (citing Heat & Power Corp. v. Air Products & Chemicals, Inc., 320 Md. 584, 591 , 578 A.2d 1202 (1990)). “Determining whether state legislation impliedly preempts local enactments ... involves assessing whether State regulations have so thoroughly and pervasively covered the subject as to completely occupy the field, and whether the subject requires uniform state-wide treatment.” Holmes v. Maryland Reclamation Associates, Inc., 90 Md.App. 120, 143-144 , 600 A.2d 864 , cert. dismissed sub. nom. County Council v. Maryland Reclamation Associates, 328 Md. 229 , 614 A.2d 78 (1992).

It is undisputed by the parties that the particular field of concern is solid waste management. We agree that the environmental statutory schemes show a legislative intent comprehensively to occupy the field of solid waste management, and thus, preempt by implication the City’s enactment of the Moratorium banning solid waste incinerators. The City contends that the Moratorium is not preempted by State environmental laws, but that the extensive statewide legislation in the field of solid waste management “manifests a general policy of fostering local control under state supervi ²²⁸ sion.” The City argues that the statutory schemes of Title 9, Subtitles 2 and 5 do not comprehensively occupy the field of solid waste management to preempt the City Moratorium. Rather, the City asserts that these provisions are evidence of the intent to have local legislative involvement in the solid waste management field.

Moreover, the City posits that the statutory provisions relating to air and water quality do not pertain to the field