20090936 Ver 1_OAH Decision_20111202

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STATE OF NORTH CAROLINA
Ofli- 'e of
COUNTY OF CARTERET Adrninisf,, ative f -: ,;,- " "
WILLIAM & KATHY TFAGUE
Petitioners,
NORTH CAROLINA DEPARTMENT
OF ENVIRONMENT AND NATURAL
RESOURCES, DIVISION OF
COASTAL MANAGEMENT,
Respondent.
JAMES & VICKY SNEAD,
Petitioners,
NORTH CAROLINA DEPARTMENT
OF ENVIRONMENT AND NATURAL
RESOURCES, DIVISION OF
COASTAL MANAGEMENT,
Respondent.
IN THE OFFICE OF
ADMINISTRATIVE HEARINGS
10 EHR 4673
10 EHR 4674
ALVIN RAYNOR.,
Petitioner,
V,
NORTH CAROLINA DEPARTMENT 10 EHR 4689
OF ENVIRONMENT AND NATURAL
RESOURCES, DIVISION OF
COASTAL MANAGEMENT,
Respondent.
The above captioned matter was heard on August 2-5, 2011, at the Craven County
Courthouse, New Bern, North Carolina, before the Honorable Donald W. Overby,
Administrative Law Judge, on three consolidated Petitions for Contested Case Hearing regarding
the Division of Coastal Management's denial of Coastal Area Management Act ("CAMA")
major development permits for each of the three Petitioners, located on neighboring lots in
Morehead City, Carteret County, North Carolina.
r-�
9 2011
N.0 A7-1-0 r

For Petitioners: Wesley C. Collins, Esq.
Harvell & Collins
1107 .Bridges Street
Morehead City, North Carolina 28557
For Respondent: Christine A. Goebel, Esq.
Assistant Attorney General
North Carolina Department of Justice
114 West Edenton Street
Raleigh, North Carolina 27602
Did Respondent deprive Petitioners of property, and exceed its authority or jurisdiction,
act erroneously, fail to use proper procedure, act arbitrarily or capriciously, or fail to act as
required by law or rule in denying Petitioners' respective LAMA major development permit
applications?
TESTIFYING WITNESSES
Heather Styron, Field Representative, Division Coastal Management, Morehead City, NC
Patricia (Trish) Murphey, Marine Biologist Supervisor, Division of Marine Fisheries, Morehead
City, NC
Michael Ted Tyndall, Assistant Director, Division Coastal Management, Morehead City, NC
Joanne Steenhuis, Senior Environmental Specialist, Division of Water Quality, Wilmington, NC
Richard Carraway, N.C. Geodetic Survey, Morehead City, NC
Dr. Louis B. Daniel, III, Director, Division of Marine Fisheries, Morehead City, NC
James M. Snead, Petitioner
Williarn J. Teague, Petitioner
Doug Huggett, Major Permits Coordinator, Division Coastal Management, Morehead City, NC
Fred "Fritz" Rhode, (formerly with DMF) NMFS, Morehead City, NC
Anne Deaton, habitat Protection Section Chief, Division of Marine Fisheries, Morehead City
Mark Golitz, Petitioners' Neighbor, Morehead City, NC
Tiny Newcomb, Licensed Land surveyor
WIN I'll
i
1. Horne General Permit (GP) '08, Whiskey Creel
2e Weiss GP '09, Middle Creek
3, Resh GP '09 Pages Creek
4 Pruna GP '08, Charles Creek
5, Donovan GP '08, Virginia Creek
6. Bebe CAMA major permit '07, Whiskey. Creek
7. Warwick CAMA major permit '10, Hewlett's Creek

8„ Dalton CAMA major permit '08, Pages Creek
9, Coble/Pollock CAMA major permit '07,
10. Oak Park at Whiskey Creek CAMA major permit '07, Whiskey Creek
12. Taylor CAMA major permit '06, Whiskey Creek
13. Brynn Marr Homes CAMA major permit '09, Charles Creek
14. Parsley CAMA major permit '10, Masonboro Sound
16. Teague main file
17. Snead main file
18. Raynor mail file
19. DMF's Guidelines for Permit Review
21. PNA map
23. PNA map
25. PNA map
26, PNA map
28, PNA map
29. PNA map
31. - 43. Tide Gage Data for various sites
54. Photo of Resh
55. Photo of Resh
56. Photo from end of cul- de-sac
57. Photo in Whiskey Creek
58. Photo in Whiskey Creek
59. Photo of Resh
72. 93. Photos of sites in Whiskey Creek
94. Photo of twin -prop boat floating
95, Photo
96, Photo
98. Photo of Calico Creek
99. Photo of Calico Creek
100. Photo of Calico Creek
101. Photo of Calico Creek
102. Photo in Dill Creek
101 Photo of Calico Creek
104. Mrs. Teague's dock
105. Photo in Dill Creek
146. Photo in Dill Creek
107. - 111. Photos of Calico Creek
112. Photo in Dill Creek
113. Photo of Calico Creek
114. Photo of Calico Creek
115. Photo in Dill Creek
116. Photo of Calico Creek
117. Photo of Calico Creek
f18. Photo in Dill Creek
119. Photo of Calico Creek
120. Photo of Calico Creek
0

121.
Photo in Dill Creek
122.
Photo in Dill Creek
123.-128.
Photos of Calico Creek
129.
Photo in Dill Creek
130.-
133. Photos of Calico Creek
134.
Photo in Dill Creek
135.
Photo in Dill Creek
136.
Photo of Calico Creek
137.
Photo of Calico Creek
138.
Photo of Dill Creek
139.
Photo of Calico Creek
I40.
Photo in Dill Creek
141,
Photo of Calico Creek
142.
Photo of Calico Creek
143.
Photo in Dill Creek
144.
Photo in Dill Creek
145.
Photo of Calico Creek
147.
- 149. Photos of Calico Creek
150.
Photo in Dill Creek
151.
Photo of Calico Creek
152.
Photo of Calico Creek
153.
Photo in Dill Creek
1.54.
Photo of Calico Creek
155.
Photo of Calico Creek
156.-
158. Photo in Dill Creek
159. -
163, Photos of Calico Creek
164.
Photo in Dill Creek
165.
Photo of Calico Creek
166.
Photo in Dill Creek
167.
Photo of Calico Creek
169.
Photo of Calico Creek
170.
Photo of Calico Creek
171.
Photo in Dill Creek
172. -
180. Photos of Calico Creek
181.
Photo in Dill Creek
182.
Photo of Dill Creek
183.
Photo of Calico Creek
184.
Photo in Dill Creek
185.-
191. Photos of Calico Creek
191
Photo in Dill Creek
193.- 19.5.
Photos of Calico Creek
196.
Photo in Dill Creek
197.
Photo of Calico Creek
198.
Photo of Calico Creek
199.
Photo in Di 11 Creek
200.
Photo in Dill Creek

201.
Photo of Calico Creek
206.
Sherman GP
207.
Harrison GP `04
208.
Harrison GP `05
209.
Gatt GP
210.
Mays GP
211.
Willis GP
213. Oversized aerial photograph of the site
214. 15A NCAC 07H.1205 (effective 7/1/09)
215. 15A NCAC 07H.1205 (effective until 7/1/09)
216. Email- Sncad to T /RIG
217. Email- Teague to Steenhuis & McMillian
218. Email- Raynor- Steenhuis
220. Google map- Morehead City /Beaufort
221. Google map- Morehead City/Beaufort
223. Google map- Bogue Inlet
224. Google map- Bogue Inlet to N. Topsail
225. Google map- New River Inlet
227. Google map- Figure 8 Island
229. Google map- Site 7, Warwick
231, Google map- Sites 8 & 3 (Dalton & Resh)
235. Google map- Site 5, Donovan
236. Google map- Masonboro Inlet
239. Google map- larger scale
241. Google map- Snow's Cut to Kure: Beach
242. Google map
244. Google map- Sites 1, 7, 6, 12
245. .Kirchner `05
246. Ted's 12/06 Staff Memo on permit elevation policy
247. Snow's Cut Corps tidal station data
250, - 255. Photos of Resh site
256. Photo of Site 8
257, Photo of Site 8
258. 260. Photos of Donovan, Virginia Creek
261. 263. Photos of Coble
264. Respondent's discovery answers and verification
265. DWQ to Teague re: more info
266. DWQ to Snead re: more info
RESPONDENT'S �HTi3TTS
1 Items From DCM's Teague Permit File
A. 5 -28 -08 Cover Letter from Vinson to Styron enclosing first app.
B. 9 -1409 Letter from Styron to Teague acknowledging complete application
C. 9 -8 -09 Teague Major Permit app, including DCM forms, site plans, narrative
S

D. 9 -10 -09 Field Investigation/Bio Report of Styron for "Teague
E. 10 -I -09 DWQ More Info Letter from Steenhuis to Teague
F. 9 -23 -09 Comments from WRC to DCM re: Teague app.
G. 9 -17 -09 Objection from DMF to DCM re: Teague app.
H. 8 -20 -09 Memo from Styron to Huggett with permit recommendations
I. 10 -20 -09 Letter from Govoni to Teague re: Permit Review Mold
J. 5 -22 -10 Letter from Collins to Huggett enclosing Subdivision Restrictions
K. 7 -22 -10 Denial Letter from Gregson to Teague
I Items from DCM's Snead Permit File
A. 5 -23 -08 Cover Letter from Vinson to Styron enclosing first app.
B. 8 -4 -09 Letter from Snead to Styron enclosing revised permit app.
C. 8 -13 -09 Letter from Styron to Snead acknowledging complete application
D. 10 -5-09 Letter from Howell to Snead acknowledging Snead's hold request
F. 8 -10 -09 Snead Major Permit app
F. 8 -13 -09 Field Investigation/Bio Report of Styron for Snead
G. 10 -1 -09 DWQ More Info Letter from Steenhuis to Snead
H. 8 -11 -09 Memo from Styron to Huggett with permit recommendations
1. 8 -31 -09 Comments from WRC to DCM re: Snead app,
J. 8 -27 -09 Objection from DMF to DCM re: Snead app.
K. 7 -22 -10 Denial Letter from. Gregson to Snead
3,. Items from D(:M's Raynor Permit File
A. 5 -30 -08 Cover Letter from Vinson to Styron enclosing first app.
B. 4 -3 -09 Cover Letter from Vinson to Styron enclosing first revisions
C. 8 -21 -09 Cover Letter frorn Vinson to Styron enclosing more revisions
D. 8 -25 -09 Letter from Styron to Raynor acknowledging complete application
F. 8 -24 -09 Raynor Major Permit app
F. 8 -25 -09 Field Investigation/Bio Report of Styron for Raynor
G. 10 -1 -09 DWQ More Info Letter from Steenhuis to Raynor
H. 9 -23 -09 Comments from WRC to DCM re: Raynor app.
1. 8 -28 -09 Objection from DMF to DCM re: Raynor app.
J. 8 -25 -09 Memo from Styron to Huggett with permit recommendations
K. 10 -20 -09 Letter from Govoni to Raynor re: re: Permit Review Fold
L. 7 -22 -10 Denial Letter from Gregson to Raynor
4. Petitioners' earlier observation pier CAMA GPs
A. Teague 4 -18 -07 LAMA GP #48473C
B. 'Teague 7 -26 -07 CAMA GP #49849C (reissue of earlier permit)
C. Snead 4 -18 -07 LAMA GP #48474C
D. Raynor 8-17-07 CAMA GP #49841 C
8. 12 -11 -06 Memo from Tyndall to DCM Regulatory Staff re: piers in shallow water areas
12. l 1 -10 -08 email from Vinson to Ps' re: DMF "flip- flopped"
134 2 -28 -08 email from Vinson to P's re; DMF "verbal agreement"
16. 7 -25 -08 email from Trish. to DMF co- workers re: Vinson/Stops with replies

17; T /S /R cover sheets for Heather's files, with her notes about meetings and contact
18. Materials from Heather's Teague file- showing application deficiencies
19; Materials from Heather's Snead file- showing application deficiencies
20� Materials from Heather's Raynor file- showing application deficiencies
Based upon careful consideration of the applicable law, testimony, and evidence received
during the contested case hearing as well as the entire record of this proceeding, the undersigned
makes the following:
FINDI' GS OF FACT
The Division of Coastal Management ( "DCM ") is charged with enforcement of the
Coastal Area Management Act ( "CAMA "), N.C. Gen. Stat. § 113A -100 et seq., and the
State Dredge and Fill Law, N.C. Gen. Stat. § 113 -229, the controlling statutes and
regulations include the Administrative Procedure Act, N.C. Oren. Stat. § 150B -1 et seq.,
and the rules promulgated thereunder, and the rules of the Coastal Resources
Commission, primarily found in Title 15A, Subchapter 7H of the North Carolina
Administrative Code ( "NCAC ").
2, Petitioner Kathy Teague ( "Teague ") owns property on Calico Creek in Morehead City,
Carteret County, North Carolina. Mrs. Teague's husband Bill Teague is also a named
Petitioner in this case, but is not on title to the property at issue. (T pp. 402, 410 -11) Mr.
Teague acted as Mrs. Teague's authorized agent in the CAMA permitting process. (T p,
402, 410) The interests of Mrs. Teague were properly represented in this contested case
hearing by Mr. Collins.
3, Petitioners James and Vickey Snead ( "Snead ") own property on Calico Creek in
Morehead City, Carteret County, North Carolina, Mr. Snead testified that when they
purchased the property in 2003, they assumed the rules would have allowed them to build
a dock with slips because there were others in the area. (1' pp. 392 -93) Having a slip was
"very important" to Mr. and Mrs. Snead for their retirement home. (T p. 393)
4; Petitioner Alvin Raynor ( "Raynor ") owns property on Calico Creek in Morehead City,
Carteret County, North Carolina. Dr. Raynor did not testify in person at the hearing. (T
p. 469)
. The Teague, Snead and Raynor (collectively "Petitioners ") properties are all on Calico
Creek and Iie within the Estuarine System Area of Environmental Concern (AEC),
specifically Coastal Wetlands, Public Trust Areas, and Estuarine Waters AECs. As such,
the Division of Coastal Management (DCM) has jurisdiction over any development on
their property, and the proposed addition of slips/lifts to their existing observation piers
requires a CAMA permit pursuant to N.C. Gen. Stat. § 113A -118.
;, On or about May 23, 2008, Petitioners Snead, submitted an application to DCM
requesting the issuance of a major permit.for the installation of one 12.5' x 12.5' strap-
6

style boat lift with permanent "stops" eighteen inches (18 ") above the substrate at the end
of an existing pier (Petitioners' Exhibit 17).
2; On or about May 28, 2008, Petitioners Teague, submitted an application to DCM
requesting the issuance of a major permit for the installation of one 12.5' x 12.5' strap -
style boat lift with permanent "stops" eighteen inches (18 ") above the substrate at the end
of an existing pier (Petitioners' Exhibit 16).
8 Can or about May 30, 2008, Petitioner Raynor, submitted an application to DCM
requesting the issuance of a major permit for the installation of one 12.5' x 12.5' strap -
style boat lift with permanent "stops" eighteen inches (18 ") above the substrate at the end
of an existing pier (Petitioners' Exhibit 18).
9. A "stop" on a boat lift is a physical barrier that is placed on the pilings of a boat lift to
prevent the boat lift cradle or boat on a strap -style lift from descending below a certain
point (T. p. 564 -566).
10, The waters of Calico Creek adjoining Petitioners' property are designated by the Marine
Fisheries Commission as a .Primary Nursery Area (PNA).
11:. 15A NCAC 031.0101(4)(f) defines PNAs as "those areas in the estuarine system where
initial post -larval development takes place. 'These are areas where populations are
uniformly very early juveniles." PNAs are an invaluable natural resource to the State.
12„ Dr. Louis Daniel, Director of the Division of Marine Fisheries (DMF) testified that boats
sitting on the bottorn of a PNA or "kicking" the bottom of a PNA can hurt the important
fisheries species in the area, and make the PNA less productive. (T pp. 330 -31) Dr.
Daniel testified that dredging in a PNA is illegal, and prop wash or kicking may be
considered dredging. (T p. 346) Ms. Anne Deaton, habitat Protection Section Chief for
DMF echoed Dr. Daniel's testimony, and added that of all the fish habitats and stages, the
nursery stage is considered by biologists to be the most critical so that the fish can get big
enough to resist predators and other envirorvnental impacts. (T p. 707)
13., Between April 18, 2007 and August 18, 2007, all three Petitioners were issued LAMA
General Permits ( "GP ") to build observation piers (without formalized slips) into Calico
Creek. (R's Ex. 4A -4D) The GPs for Teague and Snead have type - written notes on there
which indicate that "This facility is located within a Primary Nursery Area and is not for
boating use. No slips are permitted for vessels- motorized, sail or other. Any kicking or
prop wash will be considered a violation of this permit, and of the CAMA and D &F Act."
(R's F.x. 4A -4D) Mr. Snead and Mr. Teague testified that Petitioners piecemealed the
projects between the observation pier and the boat slips/lifts based on the advice of
Petitioners' marine contractor, Mr. Bailey. (T p. 393, 413)
a

CAMA MAJOR PERMIT APPLICATIONS
14e As set forth above, in the spring of 2008, Petitioners each applied for a LAMA Major
Permit to add formalized boat slips with boat lifts to each of their existing observation
piers.
t5, Since DMF had raised concerns in the past that DCM was permitting boat slips and lifts
in shallow PNA, SAV, or shellfish beds through the CAMA general permit process,
DCM Assistant Director Ted Tyndall issued guidance to field staff, through a memo
dated December 11, 2006, directing DCM staff to either process the permit as a CAMA
major permit, or check with DMF about any concerns before issuing a CAMA general
permit, using their best professional judgment to decide each case. (T pp. 105 -119, 710-
15, 814 -23; R's Ex. 8) DMF's concerns were primarily raised during interagency
meetings and communication about the Coastal Habitat Protection Plan (CHPP). (T p.
105 -119, 71015, 814 -23) This policy was then added to the Coastal Resources
Commission's rules, and became effective as a rule on July 1, 2009. (1' pp. .36)
Throughout this contested case hearing, this was referred to as the "2 -foot policy" and/or
the "2 -foot rule ".
]6z DCM Field Representative Heather Styron had been instructed concerning the "2 -foot
rule" since she started with DCM in August of 2007. She followed the rule in
Petitioners' cases with her supervisor's approval, requiring Petitioners to proceed with
the LAMA major permit process because the water depth at Petitioners' sites was so
shallow and was in a PNA. Ms. Styron stated that her supervisor was familiar with
DMF's concerns about slips in shallow PNAs, specifically in Calico Creek, and was
confident it would require CAMA major permit review. (T pp. 19 -21, 28, 37, 93 -94)
CAMA MAJOR PERMIT PROCESSING - -- COMPLETE APPLICATION ISSSIJE
IT Petitioners contend in part that Respondent and /or its agents unreasonably delayed in the
processing of the application in order to allow for new regulations to take effect, which
could potentially increase the burden on the Petitioners' application.
18. Ms. Styron testified that Ms. Vinson (Transcript incorrectly says Benson), the consultant
hired by Petitioners, contacted her sometime before she first submitted the Petitioners'
applications in the spring of 2008. (T p. 485) There were several revisions to the
l'etitioncrs' permit applications made by Ms. Vinson between May of 2008 and
August/September 2009 when all three applications were finally accepted as complete. (T
pp. 487 -88) Ms. Styron would regularly contact Ms. Vinson during this 18 month period
to check on the status of the permit application corrections and if she was still planning to
make the necessary changes. (T pp. 490-500)
19, "There were significant omissions or errors in the initial applications that needed to be
corrected after the Initial submittals in the Spring of 2008, and it took Petitioners'
consultant Ms. Vinson until August/September of 2009 to complete them. The errors and
omissions included: improper measurements of the proposed slip, incorrectly listing
8

normal high water depths instead of normal low as required by 15A NCAC 07J.
0203(b)(2), omitting "not applicable" in blank spaces as required by rule 15A NCAC 07J.
0204(b)(2), incorrectly measuring the water body width, insufficient vicinity map, failing
to show on -site coastal wetlands areas, failing to depict the channel on the site plans,
labeling dock ownership and riparian lines on the plats, and using an incorrect tidal range
number. (T pp. 502 -11)
7-0. Mr. Snead testified that Ms. Vinson was waiting to complete Petitioners' permit
applications because "she was waiting for other permits to go through the permitting
process that involved lifts with straps, with stops, in a primary nursery." Ms. Vinson was
aware of these projects and hoped to use them as a precedent, and so was advising
Petitioners not to rush. Petitioners followed her advice on complete application timing.
(T pp. 395 -96)
21, Although the Petitioners' applications were found to be incomplete by DCM upon
original submission, the Petitioners' applications were eventually accepted as complete
by DCM, and proceeded through processing. (Petitioners' Exhibits 16, 17 and 18) On
September 10, 2009, DCM accepted the Snead application for major permit as complete.
(Petitioners' Exhibit 17, T. p. 773) On September 8, 2009, DCM accepted the Teague
application for major permit as complete. (Petitioners' Exhibit 16, T. p. 773) On August
24, 2009, DCM accepted the Raynor application for major permit as complete.
(Petitioners' Exhibit 18J. p. 774)
1,2. Respondent was not responsible for any delay in the Petitioners' applications being
accepted by DCM as being complete.
CAMA MAJOR PERMIT PROCESSING TIME ISSUE
2.3. As part of the CANNA major development pe«nitting process, numerous state and federal
agencies were contacted to comment, to determine compliance or concern for Petitioners'
projects with these various agencies' subject matter specialties. A total of four agencies
expressed concern with this project, including DCM, DMF, the North Carolina Wildlife
Resources Commission (WRC), and the Division of Water Quality (DWQ). (R's Ex. lE-
IH, 2H -2K, 30-3J)
24 On February 19, 2009, DMF Marine Biologist Supervisor Patricia (Trish) L. Murphey
sent a letter to Doug I luggett, the manager of the major permits and federal consistency
unit for DCM. The letter recommended denial of Petitioners' projects due to significant
adverse impacts to shallow bottom habitat and shell habitat by prop dredging within a
PNA. (T pp. 607 -09; R's Ex. 1 G, 2J, 31)
2,5, Ms. Murphey was accepted as an expert in Fisheries Biology. (T p. 601) Ms. Murphey's
comments for Petitioners' projects were based primarily on the fact it is a PNA, the depth
at low water on the sites, and the distance to deep water. (T pp. 63 -65, 624) To assist her
in making comments to DCM, Ms. Murphey consulted DMF's Habitat Authorization

Permit Review guidelines document. (T pp. 78 -79, 610; P's Ex. 19) This document was
intended to help provide consistency in permit reviews by DMF. (T p. 709)
26, DMF Habitat Protection Section Chief, Ms, Anne Deaton, was qualified as an expert in
fisheries biology. (T p. 706) Ms. Deaton reviewed and approved Ms. Murphey's
recommendation to deny Petitioners' boat slips /lifts. (I' pp. 718 -19)
27, Dr. Louis Daniel, the Director of DMF, was accepted an expert in fisheries biology. Dr.
Daniel reviewed Ms. Murphey's and Ms. Deaton's' recommendations for DCM to deny
Petitioners' applications based on significant adverse impacts to fisheries resources. Dr.
Daniel agreed with his staff that because the applications were for boat slips and lifts in a
PNA with 0 -0.5' of water in Calico Creek, significant adverse impacts would occur. (T
pp. 368, 719) Dr. Daniel's review and agreement that Petitioners' projects would cause
significant adverse effects to the PNA and fisheries resources was his professional and
expert opinion. (T p. 374)
28; Ms. Deaton's and Dr. Daniel's review help ensure consistency in making
recommendations to DCM for CAMA permit applications, (T p. 708) Ms. Deaton
testified that the recommendations against granting Petitioners' CAMA permits were
consistent with other decisions of DMF. (T p. 721) Mr. Huggett agreed that DMF's
comments on Petitioners' applications were in line with others he's seen in his CAMA
major permit review role. (T p. 762)
29, On June 4, 2008, July 20, 2009, and July 21, 2009, Ms. Styron with DCM visited the
sites, and then prepared Field Investigation Reports on the proposed development for
each project. These reports noted the PNA designation for the site, along with a water
quality classification of SC -HQW. Ms. Styron also noted the "water depths are at an
average of 0 inches to -6 inches at [Normal Low Water] NLW in this area with an
average daily tidal range of 2.5'." In addition, the "effects from the shallow water depths
at NLW with egress and ingress have the potential to cause significant excavation
through prop wash kicking." (T pp. 512 -19; R's Ex. 1D, 2F, 31~)
30. In August of 2009, Ms. Styron sent DCM Major Permits Processing Coordinator Doug
Huggett three project recommendations that Petitioners' boat slips applications be denied
as they were inconsistent with 15A NCAC 7H.0208(a)(2)(13) and 15A NCAC
71- 1.0208(b)(1) due to the very shallow water at NLW in this area, so that any boating had
the potential to cause significant excavation through prop wash kicking;. This would be
considered new excavation which is not allowed within primary nursery areas per the
Coastal Resources Commission's rule 15A NCAC 7H.0208(b)(6). ( T pp. 52021; R's
Ex. 1 H, 2H, 3J)
31e In August and September 2009, WRC's Northeast Coastal Region Coordinator Maria T.
Dunn sent DCM's Huggett a letter supporting the comments and concerns made by DMF
regarding Petitioners' projects. (T pp. 757 -60; R's Ex. 1F, 21, 3H)

32, On October 1, 2009, DWQ Senior Environmental Specialist Joanne Steenhuis sent each
Petitioner a letter. Ms. Steenhuis indicated that she sent those letters to DCM regarding
Petitioners' applications because DMF had indicated there would be significant adverse
impacts to .fisheries resources, which, in turn, qualifies as a degradation of water quality,
which would result in the denial of a 401 Water Quality Certification. (T pp. 171 -74, 550;
P's Ex. 17; R's Ex. 1E, 2G, 3G)
33, Ms. Steenhuis testified as to what her intentions were in sending the letters to the
Petitioners; however, the language of the letter itself was plain and unambiguous, The
Petitioners were entitled to rely on that plain language.
34.. Ms. Steenhuis' letter incorrectly states that the applications were either incomplete or
provided inaccurate information. The letter went on to indicate that DWQ "needed
additional information" or that DWQ was heading towards denial of the Water Quality
Certification due to significant adverse impacts to the PNA. (R's Ex. IE, 2G, 3G)
35; The only additional information sought by DWQ was that the "proposc[sic] boat slip with
lift be removed fi"om the application." The boat slip and lift was the poly thing sought in
the application. (Emphasis added) In other words, the "additional information" sought
was for the Petitioners to withdraw their applications. The absurdity of DWQ's position
continues in the letter by saying, in essence, that if the Petitioners did not provide the
additional information by withdrawing their petitions that the projects would be held as
incomplete until they did in fact withdraw their petitions.
36. On October 5, 2009, Mr. Snead sent an email to Ian McMillian (DWQ) and Jonathan
Howell (DCM), asking that his application be put on hold for 60 days as directed by Ian
McMillan. (T. p . 39 1) On October 5, 2009, Jonathan Howell sent a letter to Mr. Snead
acknowledging; his request for the abeyance. (Respondent's Exhibit 2n)
57, On October 6, 2009, Mr. Teague sent an ernail to Joanne Steenhuis, Ian McMillan,
Daniel Govoni, Trish Murphy, Heather Styron, Jonathan Howell, Alvin Rayor, Jinn
Snead, and Mark Golitz in which he requests that the final decision on his application be
delayed "until 12/15 (or earlier, if requested by me)." (Petitioners' Exhibit 217)
38, On October 11, 2009, Dr. Raynor wrote to Joanne Steenhuis (DWQ), Ian McMillian
(DWQ), and Heather Stvron (DN/IF): "I received your letter dated October 1, 2009,
entitled "REQUEST FOR MORE INFORMATION/HEADING TOWARDS DENIAL,."
I do not wish to remove my application for a boat slip with lift, but instead, request that
you give full consideration to my application which was acknowledged as complete in a
letter to me from Heather Styron dated August 25, 2009." (Petitioners' Exhibit 18, T. p.
180)
39 On October 20, 2009, Daniel Govoni, Assistant DCM Major Permits Coordinator sent a
letter to Mr. Teague and Dr. Raynor notifying them that their applications would be
placed in "abeyance" because the NC Division of Water Quality had requested more

information, and a water quality certification must be issued for the application to
proceed.
40, Mr. Govoni tells Mr. Teague and Dr. Raynor by this letter that they "will be given five
working days" to provide the information requested by DWQ in order for DWQ to issue
a water quality certification. (Respondent's Exhibit I (I)) If the applicants were able to
provide a water quality certification within the five days then the clock would continue to
run. The "information" requested by DWQ is to withdraw their applications. In actuality,
a water quality certification was not going to be issued for these applications.
1. The Govoni Ietter goes on to say that failure to provide the "information" means that the
application will be suspended until such time as that information is provided. In other
words, unless the applications are withdrawn the process will NEVER end, which was
acknowledged by Mr. Huggett. (T_ p. 797) (Emphasis added)
42. By following the process in these applications, DWQ, a state agency and a part of this
process, was allowed to put ridiculous conditions on issuance of water quality
certifications without moving to deny the applications, which meant that these
applications would be in limbo into perpetuity and the only option the applicants had to
comply with DWQ was to withdraw their individual applications —completely and utterly
illogical to equate with "additional information."
41 15A NCAC 07J .0204 addresses processing LAMA major permit applications such as
those at issue herein. 15A NCAC 07J .0204(d) sets forth the conditions upon which an
application could be held in abeyance. "If the application is found to be incomplete or
inaccurate after processing has begun" the application may be terminated until corrected.
There is no indication that the applications were incomplete or inaccurate. Neither the
Respondent nor any state or federal agency determined that the applications were
incomplete or inaccurate.
44,. Alternatively, 15A NCAC 07J .0204(4) provides that "if additional information from the
applicant is necessary to _adequately assess the project," the application could be
terminated or held in abeyance until the information was provided by the applicant. The
only information sought by DWQ's letter and adopted by reference by Respondent was
NOT information necessary to adequately assess these projects, but was to completely
withdraw what was being sought in their individual applications, (Emphasis added)
There was no information the Petitioners could have provided which would have made
their applications more clear for Respondent to assess the applications and none was
sought.
4.5, Water quality certifications are issued by the Division of Water Quality, not the
respective applicants. The applicants are only responsible for providing the information
requested for the issuance of the certification by the Division of Water Quality. (T. 449-
450) mace the Division of Water Quality issues a water duality certification, it is
provided, by the Division of Water Quality to everyone who would need to see the
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certification. The applicant is not responsible for providing the certification to the
agencies involved. (T. 449 -450).
4 Through Mr. Huggett, DCM's position is that the "REQUEST FOR MORE
INFORMATIONiHEADING TOWARDS DENIAL" letter sent to Petitioners by the
Division of Water Quality did not operate to stop the 75 or 150 day processing "clock ".
(T. 781). It is DCM's position that the processing clock on the Teague and Raynor
applications did not stop until the DCM letters (the Govoni letters) were sent to
Petitioners Teague and Raynor, respectively. (T. p. 78 1)
47. The reason that DCM sent the Govoni letters to Petitioners was because the Division of
Water Quality was ostensibly asking for more information in the Steenhuis letter. (T. p.
782). By sending the Govoni letter, Respondent was adopting DWQ's position as set out
in the Steenhuis letter.
41 In the late fall of 2009, after Ms. Steenhuis sent her letters to Petitioners, there was a
meeting on site to discuss the proposed slips /lifts. Those present were Ms. Steenhuis
from DWQ, Ms. Murphey from DMF. Ms. Styron and Ms. Barrett with DCM (along with
Assistant Major Permit Coordinators Mr. Govoni and Mr. Howell), and Petitioners Mr.
Snead, Mr, Teague, Mr. Golitz (a property owner on Calico Creek but not a Petitioner in
this case), (T pp. 178 -79, 386, 406, 553) The concerts about the slips /lifts in a PNA in
such shallow water at NLW were discussed, as well as the possible redesign opportunity
of a community dock on a lot within the subdivision that was not in the Calico Creek
PNA. (T pp. 178 -79, 182, 387)
ilea Petitioner Mr. Sneed said his recollection of the meeting was that Petitioners indicated
they would not change their plans to a community dock, and wished the permit process to
continue, even with a denial. (T p. 388 -89) Mr. Teague's impression of the meeting was
that Petitioners expressed that the permits should proceed with processing, even if it
resulted in a denial. (T p. 408) While there were some variations on the recollections of
Respondent's witnesses who attended that meeting, it seems certain from all that there
was frustration from the Petitioners present as well as Mr. Golitz. In light of all that had
and was transpiring with the applications at that time, the Petitioners recollection that
they asked for the process to continue even if it meant denial is credible.
5srl, While no written request from Petitioners to re -start the processing of the Petitioners'
applications was received until after Mr. Collins began to represent them, and sent a
request by ernail to Mr. Huggett on July 9, 2010, none was required. (T pp. 771 -78)
51, Mr. Huggett indicated that DCM requires requests to take an application off hold in
writing by the applicant or authorized agent to protect DCM legally and avoid confusion.
a pp. 785 -86, 789) The Govoni letter, nor any other correspondence with Petitioners,
stated that Petitioners were required to .request in writing that the abeyance be lifted and
the process to continue. 'There is no statute, rule or written policy that requires such
request to be in writing. `I he Petitioners were not on notice of any such requirement. Mr.
Huggett was not aware of any such statute, rule or written policy.
13

52.. Petitioners Snead and Teague had verbally told Respondent to proceed with the process
at the meeting in late November 2009 and Dr. Teague had told Respondent by
correspondence October 11, 2009 to continue with the process,
5. Upon completing his permit application review and review of agency comments, Mr.
Huggett recommended Petitioners' CAMA permit applications be denied, and Assistant
Director Tyndall agreed with this recommendation. (T pp. 82830) By certified letters
from Director Jim Gregson, dated July 22, 2010, all three applications were denied.
54. The Coastal Area Management Act mandates that all CAMA major permit applications
shall be either approved or denied within 75 days of the application being accepted as
complete. An additional 75 day extension may be allowed in extraordinary cases. (T. p.
769)
55;; N.C.G.S 113A- 122(c) provides: "Failure of the Commission to approve or deny an
application for a permit pursuant to this section within 75 days from receipt of application
shall be treated as approval of the application, except the Commission may extend the
deadline by not more than an additional 75 days in exceptional cases."
56. 15A NCAC 07J .0204(d) as discussed above sets forth the conditions under which the
applications may be held in abeyance, terminated or otherwise suspended so that the
clock does not run on the 75 day time limit.
57., Petitioners were not responsible for any delay in processing the applications. Short of
withdrawing their respective applications as requested by DWQ, the entire process was
beyond the applicants' control.
58. In an effort to try to resolve issues concerning the applications, by cover Ietter dated
March 22, 2010, Petitioners submitted through counsel restrictive covenants executed on
March 11, 2010 and recorded in the Carteret County Register of Deeds Office on March
19, 2010. The restrictive covenants would limit the type of lifts used and the method of
maneuvering on the water by Petitioners, enforceable by the other subdivision
homeowners. (T pp. 765 -68; R's Ex. 1J) Respondent had concerns about enforceability
with the restrictive covenants regarding the use of boats, lifts, or stops. (T pp. 586, 608,
736)
59, The time from acceptance of the completed applications until they were ultimately denied
far exceeds the maximum allowed of 150 days for each application, even giving latitude
for any time administratively held in abeyance at the Petitioners' request.
60, Petitioners allege in their Prehea.ring Statements that "Respondent acted arbitrarily and
capriciously in that its decision on [these particular applications] is not consistent with its
decisions regarding other similar applications in similarly situated project sites located
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within PNAs." Respondents contend that the differences in the tidal amplitudes and other
characteristics between Petitioners' sites at Calico Creek and sites identified by
Petitioners in the Wilmington district, particularly Whiskey Creek, are a significant
difference between the sites, and that the projects are not similarly situated and are
distinguishable.
6L,. Based upon the decision rendered herein, it is not necessary to reach the issue disparate
treatment and especially as to the application of the different tidal amplitudes as raised by
Petitioners' evidence.
To the extent that the .Findings of Tact contain conclusions of law, or that the Conclusions
of Law are findings of fact, they should be so considered without regard to the given
labels.
2 The Office of Administrative Hearings (OAII) has jurisdiction to hear this case pursuant
to N.C.G.S. § I I3A -121.1 and N.C.G.S. § 15013-23. It is stipulated that all parties are
properly before the OAH and that the OAH has jurisdiction of the parties and the subject
matter. All parties have been correctly designated, and there is no question as to
misjoinder or nonjoinder oT parties. The parties received proper notice of the hearing in
the matter.
3, Petitioners bear the burden of proof on the issues. Peace v__Et iployinq See.: Comrn'n,
349 N.C. 315, 328, 507 S.E. 2d 272, 281 (1998).
=4. Under N.C. Gen. Stat. § 15013- 23(a), the administrative law judge in a contested case
hearing is to determine whether petitioners have met their burden in showing that the
agency substantially prejudiced petitioners' rights, and that the agency also acted outside
its authority, acted erroneously, acted arbitrarily and capriciously, used improper
procedure, or failed to act as required by law or rule. Brittha ven, Inc. v. Dep't of Human
Resources, 118 N.C. App, 379, 382, 455 S.E.2d 455, 459, rev. denied, 341 N.C. 418, 461
S.F-2d 745 (1095).
5, The relevant Statute in this case is N.C.G.S. § 113A, Article 7, "Coastal Area
Management Act" (LAMA). Respondent DCM regulates the coastal areas of the State
pursuant to authority conferred upon it by the CAM.A, N.C. Gen. Stat. § 113A -100 et
seq., and the State Dredge and Fill Law, N.C. Gen. Stat. § 113 -229, and various
regulations promulgated thereunder by the Coastal Resources Commission. The
associated administrative rules for coastal management, found at 15A N.0 °A.C. 07 et seq.
are also applicable. "These are the rules of the Coastal Resources Commission (CRC) for
the administration of CAN/IA.
6.. Pursuant to N.C.G.S. 113A -1130 and (b)(6), the Coastal Resources Commission has
designated Areas of Environmental Concern and has adopted use standards or State
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guidefines fiordevOopment within thtcnt, located pit �g5€�NeC.A.C, 07Ij 01001 rsi seq Cader
CAMA, develtapm,- t in an Aiwa of° l"1avironn1 n W C�rrccrt ".k requires a pernia,
N:C.C.S §, 111�ATI IB.. C iu si �5 s.t��i is. charged b '4he CRC to regulate development
within the CRC's designated urcas of ADC's within the 20 coastal counties . €._S.
As 103 DCM's role is to review and permit development in accordance with
CAMA, Forth Carolina General Statutes, and the administrative rules for crustal
development.
7. Petitioners' shoreline property on Calico Creek is within the Estuarine System AEC; and,
as such, DCM has administrative permitting authority over any development extending
from Petitioners' property into Calico Creek. N.C. Gen. Stat. §§ 113A -107, -113, -118.
8e Petitioners' proposed project to add boat slips with boatlifts and/or slings to their existing
observation piers requires the application for a CAMA Major Development Permit. N.C.
Gen. Stat. § I I3A -118.
9 RCM's direction to Petitioners' consulmr,t Ms, VhLson to process the boat slip
applications through a CAMA major permit process was proper, pursuant to DCM's
policy (R's Ex. 8), 15A NCAC 7J .1106, and 15A NCAC 7H. 1204(d).
10. There was no improper delay by DCM in getting complete applications from Petitioners,
1, 1, Petitioners William and Kathy Teague, James and Vicky Snead, and Alvin Raynor have
standing to bring this case and are properly before the Office of Administrative Hearings.
12. N.C.G.S 113A-122(c)-)provides: "Failure of the Commission to approve or deny an
application for a permit pursuant to this section within 75 days from receipt of application
shall be treated as approval of the application, except the Commission may extend the
deadline by not more than an additional 75 days in exceptional cases."
13, The Petitioners' applications liar major permits were not approved or denied within 75 or
150 days of being accepted as complete.
14, The only rule, statute or law that allows for the abeyance of the 75 of 150 day processing
period is 15A NCAC 07J.0204(d).
15, 15A NCAC 07J.0204(d) provides: "If the application is found to be incomplete or
inaccurate after processing has begun or if additional information from the applicant is
necessary to adequately assess the project, the processing shall be terminated pending
receipt of the necessary changes or necessary information from the applicant. During the
pendency of any termination of processing, the permit processing period shall not run. If
the changes or additional information significantly alters the project proposal, the
application shall be considered new and the permit processing period will begin to run
from that date." (Emphasis added).
16- There is no indication that the applications were incomplete or inaccurate. Neither the
Respondent nor any state or federal agency determined that the applications were
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incomplete or inaccurate. The Petitioners' applications were complete and accurate;
therefore, those portions of 15A NCAC 07J.0204(d) are not applicable to stay the
processing clock,
17; The information that was purportedly requested from the Petitioners that Respondents
contend served to stop the processing clock is either removal of the boat lifts from the
applications or a water quality certification.
1. Water quality certifications are provided by the Division of Water Quality, not applicants
for CAMA permits; thus, the failure to provide a water quality certification does not
constitute "additional or necessary information from the applicant," and cannot serve as a
basis for stopping the processing clock.
19. The Petitioners' applications only sought to install boat lifts. If the Petitioners removed
the boat lifts from the applications, there would be nothing left to permit. Therefore,
failure to remove of the boat lifts from the applications cannot serve to stop the
processing clock. Additionally, removal of the boat lifts from the applications is not
"information" necessary to assess the project.
0i It was error as a matter of law for DWQ to place any type of administrative hold or delay
on these projects based on its stated reasons; i.e. that the Petitioner's should remove the
request from the applications in order to be approved, or that the Petitioners should
provide a water quality certification.
21, It was error as a matter of law for Respondent to blindly rely on DWQ's irrational request
for "additional information" when in fact there was no firrther information. Petitioners
could provide short of withdrawing their respective applications.
21 The conundrum created by DWQ was without end—the proverbial "Catch 22."
Respondent cannot merely sit idly by while DWQ ties up these applications. In fact,
Respondent admits that DWQ cannot hold up the process, and Respondent initiated the
administrative hold by adopting as its own DWQ's position of the need for additional
information.
23, "there Is evidence in the record that Petitioners Snead and Teague requested a 60 day
delay of the processing of their applications.
21, The Respondent failed to offer any evidence or authority that would allow an applicant to
voluntarily delay the processing of their respective application for major CAMA permit,
Assuming arguendo that such a delay is allowed in the law, the terms of the delay were
established by the correspondence from Petitioners Snead and Teague. As such, any
voluntary abeyance of the processing clock was limited to 60 days, which expired no
later than mid - December, 2009; leaving the processing period of the Snead and Teague
applications well in excess of 75 or 150 days.
25, There is rio authority that allows DCM to require a written request for removal of a
voluntary stay of application processing.
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26, Petitioner Raynor did not request an abeyance of processing, and specifically informed
DWQ and DCM on October 11, 2009 to proceed with his application as submitted.
Petitioners Teague and Snead verbally requested the applications proceed as submitted.
2.7. This 'Tribunal is extremely concerned about the potential for significant environmental
impact by these applications; however, Respondent acted erroneously, failed to use
proper procedure, acted arbitrarily or capriciously, and failed to act as required by law or
rule in denying Petitioners' respective CAMA major development permit applications.
Based on the foregoing findings of fact and conclusions of taw, Respondent's decisions
to deny Petitioners' applications for LAMA major development permits are REVERSED.
Petitioners have met their burden of proof in showing that Respondent deprived Petitioners of
property, exceed its authority or jurisdiction, act erroneously, fail to use proper procedure, act
arbitrarily or capriciously, or fail to act as required by law or rule in denying Petitioners'
respective CAMA major development permit applications, as alleged in Petitioners' petitions for
a contested case hearing under N.G. Gen. Stat. § 150B- 23(a).
t'1
It is hereby ordered that the agency serve a copy of its final agency decision on the Office
of Administrative Hearings, 6714 Mail Service Center, Raleigh, NC 27699 -6714, in accordance
with N.G. Gen. Stat. § 15013- 36(b)(3).
The agency making the final decision in this contested case is the North Carolina Coastal
Resources Commission. That Commission is required to give each party an opportunity to file
exceptions to this recommended decision and to present written arguments to those in the agency
who will make the final decision. N.G. Gen. Stat. § 150B- 36(a).
The agency is required by N.C. Gen. Stat. § 150B -36(b) to serve a copy of the final
decision on all parties and to the Office of Administrative Hearings..
This the I `l ` day of ` , 2011.
18

A copy of the foregoing was mailed to:
Wesley C. Collins, Fsq,
Harvell & Collins
1107 Bridges Street
Morehead City, North Carolina 28557
Christine A. Goebel
Assistant Attorney General
North Carolina Department of Justice
114 West Edenton Street
Raleigh, North Carolina 37602
This the j`r`' day of 2011.
,
Office cOAdministrative Hearings
6714 Mail Service Center
Raleigh, North Carolina 27699 -6714
(919) 733 -2698
Fax: [phone]
1' 9