20201654 Ver 1_Denial_20210728

July 28, 2021

DWR # 20201654
Madison County

Mulberry Farm – Madison LLC
Attn: Mr. Richard Kelly
1126 Upper Thomas Branch Road
Marshall, NC 28753

Subject: DENIAL of 401 Water Quality Certification
Mulberry Gap Farms

Dear Mr. Kelly:

On February 2, 2021, the Division of Water Resources (Division) received your application, with payment
received on February 8, 2021, requesting a 401 Water Quality Certification from the Division for the
subject project. On April 15, 2021, the Division notified you that your application was incomplete and
requested additional information. The Division received a response on May 17, 2021.

Notwithstanding North Carolina regulations governing the timeline for the Division’s review of 401
Water Quality Certification applications, the U.S. Army Corps of Engineers recently re-interpreted its
existing regulations and EPA has recently promulgated rules governing the states’ 401 Water Quality
Certification process.1 The U.S. Army Corps of Engineers has indicated that the Division’s reasonable
period of time for action on your application under section 401 of the Clean Water Act concludes August
2, 2021. Therefore, the Division must act on your 401 Water Quality Certification application at this
time.

After reviewing the May 17, 2021 response, the Division has determined the application is still
incomplete and the Division has insufficient information to issue a 401 Water Quality Certification for
the discharge from the proposed project. Therefore, in accordance with 15A NCAC 02H .0507(e) and 40
CFR § 121.7, your application for a 401 Water Quality Certification is hereby denied.

Once you have addressed the items listed in the request for additional information completely and the
items below, at a minimum, you may reapply to the Division including complete application package and
appropriate fee.

1 See U.S. Army Corps of Engineers Regulatory Guidance Letter, “Timeframes for Clean Water Act Section 401
Water Quality Certifications and Clarification of Waiver Responsibility, dated August 7, 2019; see Clean Water Act
Section 401 Certification Rule at 40 CFR § 121.1 et seq.

Mulberry Farm – Madison LLC
DENIAL of 401 Water Quality Certification
DWR # 20201654
Page 2 of 3

1. Although the Division believes that beaver dam analog (BDA) structures have the potential to be
used for ecological restoration and aquatic habitat improvement, the Division does not believe
the subject development is the appropriate location for these structures. As has been previously
noted by the reviewing agencies, the BDA structures appear to have been designed as an
amenity to adjacent development rather than to primarily provide ecological benefit. The
Division is concerned that the BDA structures and the mosaic of habitats that could develop
around these structures will be limited by the surrounding infrastructure and that the systems
will be maintained with a priority on surrounding infrastructure rather than on ensuring the
natural evolution of the BDA system may develop unencumbered. The Division believes that the
overall project purpose may be achieved by avoiding the impacts associated with the beaver
dam analog (BDA) structures. The Division believes that floodplain connectivity, aquatic habitat
improvement, and re-establishment of native vegetation may be achieved using natural channel
design principals, thereby avoiding or minimizing the conversion of streams to open water
systems. However, as the April 15, 2021 response indicates, the applicant does not believe the
project objectives may be achieved using natural channel design principals. As such, the project
does not meet the requirements of 15A NCAC 02H .0506(b). Should you choose to reapply to
the Division and provide more detailed justification that open water amenities are necessary for
the project purpose, please note that conversion of streams to open water and/or wetland as
proposed will require mitigation. A mitigation plan that meets the requirements of 15A NCAC
02H .0506(c) will be required. [15A NCAC 02H .0506(b) and (c)]

2. In the April 15, 2021 request for more information, the Division asked that you provide details
regarding the stormwater treatment plan for the site. To date, the Division has not received any
stormwater plans. Additional details regarding stormwater management are required with re-
application as originally requested. [15A NCAC 02H .0506(b)(3)]

The Division’s decision can be contested as provided in Chapter 150B of the North Carolina General
Statues by filing a Petition for a Contested Case Hearing (Petition) with the North Carolina Office of
Administrative Hearings (OAH) within sixty (60) calendar days. Requirements for filing a Petition are set
forth in Chapter 150B of the North Carolina General Statutes and Title 26 of the North Carolina
Administrative Code. Additional information regarding requirements for filing a Petition and Petition
forms may be accessed at http://www.ncoah.com/ or by calling the OAH Clerk’s Office at (919) 431-
3000.

One (1) copy of the Petition must also be served to the North Carolina Department of Environmental
Quality:

William F. Lane, General Counsel
Department of Environmental Quality
1601 Mail Service Center
Raleigh, NC 27699-1601

Mulberry Farm – Madison LLC
DENIAL of 401 Water Quality Certification
DWR # 20201654
Page 3 of 3

This completes the review of the Division under section 401 of the Clean Water Act. Please be aware
that you have no authorization under the Water Quality Certification Rules for this activity and any work
done within waters of the state may be a violation of North Carolina General Statutes and
Administrative Code.

Please contact Sue Homewood at 336-776-9693 or [e-mail] if you have any
questions or concerns.

Sincerely,

S. Daniel Smith
Director, Division of Water Resources

cc: Clement Riddle and Alea Tuttle, ClearWater Environmental Consultants (via email)
Brandee Boggs, USACE Asheville Regulatory Field Office (via email)
Andrea Leslie, NCWRC (via email)
Byron Hamstead, USFWS (via email)
Todd Bowers, US EPA Region 4 (via email)
DWR 401 & Buffer Permitting Unit

April 15, 2021

DWR # 20201654
Madison County

Mulberry Farm – Madison LLC
Attn: Mr. Richard Kelly
1126 Upper Thomas Branch Road
Marshall, NC 28753

Subject: REQUEST FOR ADDITIONAL INFORMATION
Mulberry Gap Farms

Dear Mr. Kelly:

On February 2, 2021, the Division of Water Resources (Division) received your application dated
February 2, 2021, requesting a 401 Water Quality Certification from the Division for your project. On
February 17, 2021 we notified you that the project would require an Individual 401 Water Quality
Certification and on March 4, 2021 the US Army Corps of Engineers (USACE) issued a Public Notice for
the proposed project which completed the application process and began the Division’s review period in
accordance with 15A NCAC 02H .0506. The Division has determined that your application is incomplete
and cannot be processed. The application is on-hold until all of the following information is received:
1. If the USACE requests a response to any comments received as a result of the Public Notice,
please provide the Division with a copy of your response to the USACE. [15A NCAC 02H
.0502(c)]

2. The Division believes the overall project purpose may be achieved by avoiding the impacts
associated with the beaver dam analog (BDA) structures. Please explain why the ecological
function of the streams and wetlands on site cannot be improved using natural channel design
techniques such as in-stream structures to provide bedform diversity and floodplain access
and/or by removing invasive vegetation and re-establishing native vegetation. Please be aware
that if it is determined that impacts to the streams and wetlands associated with the BDAs
cannot be avoided, then the conversion of streams and wetlands to open water will be
considered a loss of existing use and will require mitigation. [15A NCAC 02H .0506(b)(1)]

3. The project proposes to impact a wetland (NJW1) that the USACE has determined is not subject
to Section 404 of the Clean Water Act (CWA). Please clarify whether the subject wetland is
eligible for permitting under the 15A NCAC 02H .1300 rules for discharges to isolated wetlands
and isolated waters. You must provide documentation that the wetland meets the definition of
isolated previously used by the USACE (see
DocuSign Envelope ID: D9737C7B-8B78-48D3-B93C-5C2E894DFA5E

Mulberry Farm – Madison LLC
Request for Additional Information
Page 2 of 3

https://files.nc.gov/ncdeq/Water%20Quality/Surface%20Water%20Protection/401/Policies_Gui
des_Manuals/cwa_jurisdiction_following_rapanos120208.pdf). Please note that if the wetland is
not eligible for coverage under 15A NCAC 02H .1300 then there is currently no permitting
mechanism to apply for impacts to the wetland and you should consider modifying your project
to avoid impacts to the wetland. [15A NCAC 02H .0506(b)]

4. It appears that there may be another non-jurisdictional wetland proposed for impact, depicted
on Figure 5A, associated with the road network in the vicinity of the School of Business Wisdom.
The feature is depicted in pink hatching and the road appears to cross it. Please clarify if impacts
to this wetland will be avoided. [15A NCAC 02H .0506(b)]

5. There is a wetland at the lower end of the stream enhancement reach. Will this wetland be
impacted in any way (e.g. construction access) during stream enhancement activities? If so, how
will the wetland be restored following construction? [15A NCAC 02H .0506 (a)(6) and (7) and
15A NCAC 02H .0506(b)(2)]

6. How will the disturbed areas, and in particular the stream banks, associated with the culvert
removals be stabilized and/or restored? [15A NCAC 02H .0506(b)(2)]

7. Please confirm stormwater from built upon area will be transported via dispersed flow and
vegetated conveyances. Please provide additional details regarding the stormwater treatment
plan for the welcome center parking lot. The Division of Water Resources will be responsible for
review and approval of any stormwater management plan associated with the development.
[15A NCAC 02H .0506(b)(3)]

Pursuant to Title 15A NCAC 02H .0502(e), the applicant shall furnish all of the above requested
information for the proper consideration of the application. Please respond in writing within 30
calendar days of receipt of this letter by sending one (1) copy of all of the above requested information
to the 401 & Buffer Permitting Branch, 1617 Mail Service Center, Raleigh, NC 27699-1617 OR by
submitting all of the above requested information through this
link: https://edocs.deq.nc.gov/Forms/Supplemental-Information-Form (note the DWR# requested on
the link is referenced above).

If all of the requested information is not received within 30 calendar days of receipt of this letter, the
Division will be unable to approve the application and it will be denied as incomplete. The denial of this
project will necessitate reapplication to the Division for approval, including a complete application
package and the appropriate fee.

Please be aware that you have no authorization under the Water Quality Certification Rules for this
activity and any work done within waters of the state may be a violation of North Carolina General
Statutes and Administrative Code.

DocuSign Envelope ID: D9737C7B-8B78-48D3-B93C-5C2E894DFA5E

Mulberry Farm – Madison LLC
Request for Additional Information
Page 3 of 3

Please contact Sue Homewood at 336-776-9693 or [e-mail] if you have any
questions or concerns.

Sincerely,

Jeffrey Poupart, Section Chief
Water Quality Permitting Section
Division of Water Resources

cc: Clement Riddle and Alea Tuttle, ClearWater Environmental Consultants (via email)
Brandee Boggs, USACE Asheville Regulatory Field Office (via email)
Andrea Leslie, NCWRC (via email)
Byron Hamstead, USFWS (via email)
DWR ARO 401 files
DWR 401 & Buffer Permitting Unit

DocuSign Envelope ID: D9737C7B-8B78-48D3-B93C-5C2E894DFA5E