When it reviews a wetland individual permit application, the DNR must consider the impacts of the entire project proposing wetland fill, and not only the physical footprint of the proposed fill itself. DNR’s purview of secondary impacts extends to otherwise unregulated activities of the permitted project where they result in significant adverse environmental consequences.

In its December 5 decision, Kohler Co. v. Wisconsin DNR and Claudia Bricks and Friends of the Black River Forest (2021AP1187), the Wisconsin Court of Appeals upheld an administrative law judge’s reversal of the DNR’s decision to issue Kohler an individual permit to fill 3.69 acres of wetlands to construct a golf course along Lake Michigan.

The key controversy was whether the DNR’s review of “other significant adverse environmental consequences” should turn on impacts that were secondary to the fill that triggered the permit in the first place. In a 49-page opinion, the Court found that it should.

Secondary Impacts

Under state wetland law, the DNR may issue individual permits for wetland fill only once it determines that the project in question will not result in significant adverse impact to water quality, to “wetland functional values,” or otherwise cause significant adverse environmental consequences.

Wetland functional values, or WVFs, include criteria like the wetland’s ability to filter nutrients and toxic substances that would otherwise damage other waters, its ability to serve as a habitat for wildlife, and its recreational and scientific value. In evaluating impacts to WFVs, the DNR must consider the consequences across five dimensions: the direct impacts of the proposed project to WFVs, potential cumulative impacts, potential secondary impacts, impact from required mitigation measures, and net positive or net negative environmental impacts of the proposed project.

In Kohler’s permit, the DNR identified the wetland functional values associated with the project site, including its exceptional wildlife and aquatic life habitat, shoreline protection function, and flood storage capacity. In addition to the permanent loss of the direct area proposed to be filled, the DNR had found that secondary impacts to WFVs may affect an additional 4.79 acres of wetland.  The DNR found that secondary impacts for this project may include:

  • Increased runoff of nutrients, herbicides, and pesticides;
  • Foot and cart traffic in the remaining wetland;
  • Decrease in habitat from increased invasive species, nutrient, and sediment deposition;
  • Potential disruption of wildlife use (breeding and nesting) and movement through operation of the golf course; and
  • Decrease in wooded cover converted to managed turf grass.

The DNR also concluded that “significant cumulative impacts” might occur to the wetland functional values—the wetlands at issue are rare and of very high quality. Approving this permit could open the door to increased applications to fill similarly valuable wetlands. However, this finding was not dispositive in the case.

Permit Challenge

The DNR issued the permit in 2018 despite its findings of these secondary and cumulative impacts. Claudia Bricks and Friends of the Black River then sought review, asking (1) whether the permit satisfied the statutory requirement to determine whether a proposed project will result in “other significant adverse environmental consequences” [1], and (2) whether the DNR had sufficient information to consider that standard. The ALJ reversed the DNR permit approval in a decision later affirmed by the circuit court and now in this case.

Key Findings:[2]

Wisconsin wetlands law requires the DNR to consider the entirety of a “proposed project” when addressing a wetland individual permit, not just impacts to the wetlands proposed to be filled.

  • The DNR must consider potential secondary impacts beyond the physical footprint of directly impacted wetlands.
  • The universe of what is fair game for potential secondary impacts includes WFVs outside the footprint of the direct fill, including the value of habitats for birds and “scenic beauty.”

This holding has important ramifications for wetland permitting and reflects an understanding that a wetland is more than just the sum of its parts—even if a proposed project only has a limited direct effect on certain wetlands, filling them in may result in far broader ecological effects. Kohler may decide to appeal the decision to the Wisconsin Supreme Court.

[1] This standard is set forth in Wis. Stat. 281.36(3n)(c)3.

[2] In a footnote, the Wisconsin Court of Appeals disposed of Kohler’s argument that it should narrow its scope of jurisdictional wetlands based on the United States Supreme Court decision in Sackett v. EPA. The Court noted that legislature delegated to the DNR “general supervision and control over the waters of the state,” and that delegation of state law is not abrogated by Sackett’s limitation on what wetlands are subject to the federal Clean Water Act.  Therefore Sackett does not narrow Wisconsin’s jurisdiction over wetland functional values falling outside the actual footprint of a wetland.

Stafford Rosenbaum LLP is a full-service law firm with two convenient office locations in Madison and Milwaukee, Wisconsin. 145 years of dedication to businesses, governments, nonprofits, and individuals has proven that effective client communication continues to be the heart of our practice.

Law Clerk Klara Henry assisted with researching and writing this post.

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