                 IN THE SUPREME COURT OF TENNESSEE
                            AT NASHVILLE
                               February 10, 2016 Session

               STARLINK LOGISTICS INC. v. ACC, LLC, ET AL.

                   Appeal by Permission from the Court of Appeals
                       Chancery Court for Davidson County
                    No. 121435II    Carol L. McCoy, Chancellor


                  No. M2014-00362-SC-R11-CV – Filed May 9, 2016


After its closure, a Class II landfill continued to discharge contaminants into a creek that
flowed into a lake located on adjoining property. Following years of investigations and
multiple failed remedial measures, the landfill owner and the state agency with authority
to direct landfill cleanup operations agreed that the most feasible, practical, and effective
way to abate the discharge was for the landfill owner to divert water from entering the
landfill and, over a four-year period, to remove and relocate the landfill waste. The
neighboring landowner of the property on which the lake affected by the discharge was
located objected to the plan, arguing that the landfill owner should also be required to
treat or divert water leaving the landfill site. The Tennessee Solid Waste Disposal
Control Board (“the Board”) heard the case and approved the landowner’s plan of action
and did not require diversion of the water leaving the landfill. The neighboring
landowner appealed, and the trial court affirmed the Board’s decision. The Court of
Appeals, dissatisfied with the ruling, remanded the case to the Board to take additional
proof on whether the neighboring landowner was willing to pay for the costs of diverting
the discharge, the costs of implementing the diversion option, and the landfill owner’s
ability to pay for the diversion plan. We granted the Board’s application for permission
to appeal. We hold that the Court of Appeals failed to properly apply the judicial review
provisions of Tennessee Code Annotated section 4-5-322(h) (2011) and substituted its
judgment for that of the Board. The judgment of the Court of Appeals is reversed.

   Tenn. R. App. P. 11 Appeal by Permission; Judgment of the Court of Appeals
               Reversed; Case Remanded to the Court of Appeals

SHARON G. LEE, C.J., delivered the opinion of the Court, in which CORNELIA A. CLARK,
JEFFREY S. BIVINS, and HOLLY KIRBY, JJ., joined.
Herbert H. Slatery III, Attorney General and Reporter; Andrée S. Blumstein, Solicitor
General; and Elizabeth P. McCarter, Senior Counsel, for the appellant, Tennessee Solid
Waste Disposal Control Board.

William L. Campbell, Jr., Nashville, Tennessee; Sheryl G. Snyder, Louisville, Kentucky;
and Wm. T. Robinson III, Christopher S. Habel, and Stephen N. Haughey, Cincinnati,
Ohio, for the appellee, StarLink Logistics Inc.

Sharon O. Jacobs and C. David Briley, Nashville, Tennessee, and Thomas W. Hardin and
Kori A. Bledsoe, Columbia, Tennessee, for the appellee, ACC, LLC.

Donald Capparella and Elizabeth Sitgreaves, Nashville, Tennessee, for the Amici Curiae,
Gene Barker, Linda Barker, Claude Brawner, Faye Brawner, Eldon R. Cummins, Sara
Cummins, Dwight Green, David Greenfield, James Earl Jones, Gail McCain, Morris Ray
McCain, Jimmy E. McKennon, Larry Patton, Sue Powell, Charles Spears, Billy Ray
Thompson, Fred Thompson, and Colin S. Underwood.

                                           OPINION

                                                I.

       In 1981, the Tennessee Department of Environment and Conservation (“TDEC”)
issued ACC, LCC (“ACC”) a permit to construct and operate a Class II landfill in Maury
County.1 The landfill was located on approximately fourteen acres of the 48.02 acre
parcel owned by ACC. ACC disposed of aluminum recycling wastes from Smelter
Service Corporation’s local aluminum smelting plant. The waste consisted almost
exclusively of bag-house dusts and “salt cake” slag. The salt cake slag contained high
concentrations of highly soluble sodium chloride and potassium chloride. ACC operated
the landfill from 1981 to 1993. In July 1995, ACC submitted a certification of
completion of closure to TDEC, and in April 1996, TDEC issued an acceptance of
closure to ACC.

        TDEC and ACC learned, within a few years of when the landfill became
operational, that high levels of chlorides and ammonia were being discharged from the
landfill into groundwater and surface water that drained into Sugar Creek and Arrow
Lake. The leaching of chloride and ammonia continued after the landfill’s closure and
caused areas west of the landfill, including Sugar Creek and Arrow Lake, to become
       1
          When the permit was issued, TDEC was known as the Tennessee Department of Public Health
and ACC was known as Associated Commodities Corporation. The facts and procedural history in the
opinion are taken from the Amended and Restated Consent Order as presented by TDEC and ACC to the
Davidson County Chancery Court for approval. Starlink did not take issue before the Tennessee Solid
Waste Disposal Control Board with any of the facts stated in the proposed Amended and Restated
Consent Order.

                                                2
polluted. ACC worked with TDEC to identify and remedy the leaching. ACC performed
extensive investigative efforts to determine the cause of the leaching and performed
multiple remedial measures but was unsuccessful in abating the pollution.2 In December
2003, at TDEC’s request, ACC submitted a Corrective Action Plan (“the Plan”) that
evaluated available data, described the limitations of available options due to the site
conditions, and identified three remaining options to mitigate the release of contaminated
leachate from the landfill: clean closure/waste removal, leachate collection/treatment, and
natural or enhanced site attenuation. The Plan presented an assessment of the feasibility
and potential effectiveness of these options and concluded that a remedy that fulfilled all
criteria in Tennessee Compilation of Rules and Regulations Chapter
1200-1-7-.04(7)(a)8(ii)3 within two to three years was not technically and economically
practical. After a January 2004 public meeting, TDEC approved ACC’s plan to build a
wetlands system downgradient of the site to retain and buffer leachate and improve water
quality and habitat. The wetlands system was constructed but was not successful.

        In June 2008, TDEC requested that ACC submit a modified plan because the rate
of discharge of contaminants from groundwater was increasing. In August 2008, ACC
submitted a modified plan (“the Modified Plan”) that TDEC approved in April 2010.
The Modified Plan acknowledged that the discharge problem stemmed from a failure to
accurately characterize the landfill’s hydrogeology features during the permitting and
development process, identified options for reducing the release of chlorides from the
landfill and for removal of the contaminated material, and provided a strategy and
        2
          Remedial measures included application of daily cover material to divert rainfall from the
wastes; construction of ditches to reroute surface water around the landfill; construction of multiple
settling ponds and drainage control ditches; attempted sealing of springs and seeps; installation,
development, and maintenance of a system of groundwater monitoring wells to delineate the nature and
extent of groundwater contamination; collection and analysis of surface and groundwater samples; soil
boring/rock coring with installation of piezometers along the landfill perimeter and test pit/trench
excavations within the landfill to evaluate groundwater flow into the landfill; performance of dye tracer
studies to define groundwater flow and karst impact near the landfill; investigation of landfill area for
karst conditions; performance of electrical resistivity and microgravity surveys of the landfill to define
water flow paths beneath the landfill; and geoprobe and rotary auger investigations to evaluate depth to
bedrock and groundwater conditions.
        3
          These criteria required corrective measures to:
        (I) Be protective of human health and the environment,
        (II) Attain the groundwater protection standard as specified pursuant to Rule
        1200-01-07-.04(7)(a) 1 of this rule.
        (III) Control the source(s) of releases so as to reduce or eliminate, to the maximum extent
        practicable, further releases of Appendix II constituents into the environment that may
        pose a threat to human health or the environment; and
        (IV) Comply with standards for management of wastes as specified in subpart (iv) of part
        9 of this subparagraph.

Tenn. Comp. R. & Regs. 1200-1-7-.04(7)(a)8(ii) (2003).


                                                    3
schedule to evaluate, select, and implement ways to address the contaminated discharge.
The first step was a preliminary evaluation of potential corrective action options,
followed by a report to TDEC that would identify options as not feasible or potentially
feasible, provide additional information for a more complete evaluation of potentially
feasible options, and describe the field investigations or other efforts necessary to gather
the additional information.

        Under the Modified Plan, ACC submitted a preliminary report to TDEC in August
2010, detailing ACC’s efforts since April 2010. The report requested that TDEC clarify
its corrective action goals, summarized current site conditions, identified corrective
action alternatives, summarized planned additional data gathering efforts to evaluate the
feasibility of remaining alternatives, described the future corrective action plans, and
recommended a meeting to discuss prioritization and timing of additional necessary
efforts.
       In January 2011, representatives of ACC and TDEC’s Divisions of Solid Waste
Management and Water Pollution Control met to discuss the necessary level of
contaminant reduction for Sugar Creek. ACC discussed the potential remedy of
removing the waste from the landfill and planned to do test excavations of waste material
to assess the feasibility of the remedy.

        In February 2011, TDEC personnel inspected the landfill and took water samples
at points along Sugar Creek that confirmed that discharge from the landfill caused high
levels of chlorides, ammonia, and dissolved solids in Sugar Creek downstream of the
landfill.

       In June 2011, ACC and TDEC entered into an administrative consent order stating
that the release of contaminated discharge from the landfill constituted violations of the
Water Quality Control Act of 1977, Tenn. Code Ann. §§ 69-3-101 to -148 (2011), and
the Tennessee Solid Waste Disposal Act, Tenn. Code Ann. §§ 68-211-101 to -124
(2011). The proposed order provided for remedial actions to address the continuing
discharge from the landfill. ACC agreed to submit a discharge reduction plan to
significantly reduce the amount of contamination flowing from the landfill site in surface
water and to develop and implement a plan to effectively and permanently prevent the
release of landfill waste to the groundwater. The consent order was filed in the Davidson
County Chancery Court, under Tennessee Code Annotated sections 68-212-114(e)
(2011), 68-212-215(f) (2011), and 69-3-115(e) (2004 & Supp. 2011).

       StarLink Logistics Inc. (“StarLink”), which owns approximately 1500 acres
immediately west of the landfill and on which Arrow Lake is located, intervened and
objected to the consent order. After the parties could not reach an agreement, the
Davidson County Chancery Court remanded the matter to the Board for a contested


                                             4
hearing. On remand, ACC and TDEC negotiated an Amended and Restated Consent
Order (“Amended Order”), which was presented to the Board for approval.

       The proposed Amended Order required ACC, among other things, to:

        1. Within 120 days of the effective date of the proposed Amended Order and
before the commencement of any corrective action, construct a berm upgradient from the
site to divert uncontaminated storm water away from the site; and

       2. Within four years or less from the effective date of the proposed Amended
Order, remove from the landfill site, to the extent practicable, all solid waste that has the
potential for future contact with ground or surface water. All waste must be removed to
an approved landfill cell on ACC’s property or to a permitted off-site landfill. After ACC
begins removal of the waste, it must capture groundwater entering the excavated area,
analyze its chemical characteristics, and redirect it back into the landfill or discharge it
into Arrow Lake if the water meets certain water quality criteria.

       To promote compliance, the proposed Amended Order assessed a $400,000
penalty to ACC due and payable in four yearly installments of $100,000 if ACC failed to
meet yearly milestones for the removal of waste.

       On August 7, 2012, the Board held a contested hearing regarding approval of the
proposed Amended Order. TDEC and ACC urged the Board to approve the proposed
Amended Order, contending that the only way to remedy the contamination coming from
the closed landfill was to divert storm water away from the landfill site and to remove the
waste from the landfill. StarLink objected to the proposed Amended Order, asserting,
among other things, that the proposed plan did not adequately address the continued
discharge of leachate into Sugar Creek and onto StarLink’s property.

       In response to preliminary questions from Board members, Nancy Sullivan, a
professional engineer with Triad Environmental Consultants (“Triad”), explained that at
least 250,000 cubic yards of waste would need to be removed from the site. Chris Scott,
a professional geologist with Triad, explained that he had been working on the landfill
site for several years and that after failed attempts to address surface water
contamination, it became clear that groundwater was the major source of the problems
with the landfill. Mr. Scott explained that groundwater had been entering the landfill
from the north and east sides of the landfill, and the first phase of the proposed plan was
removal of waste from the landfill’s northern side. George Garden, an engineer with the
engineering firm Barge, Waggoner, Sumner & Cannon, stated that based on his
measurements of the water flow rate and contaminant concentrations of the landfill for
the past year, there was no single point of contact between the landfill waste and
groundwater. Although he had studied ways to remove contaminant materials from the
water as it left the landfill area, Mr. Garden was of the opinion that the only way to

                                             5
permanently address the problem was removal of the waste to another location.
According to Mr. Garden, the cost of treating the discharge would be high and roughly
equal to the cost of removing some of the waste material. From an economic standpoint,
Mr. Garden opined that it would be better to focus ACC’s resources on removing the
landfill’s waste material as opposed to treating discharge that leaves the landfill area.

       StarLink called as its first witness, Dennis Schucker, a professional geologist and
associate director with BHE Environmental, who prepared an investigation work plan
report for the StarLink property that indicated elevated levels of chloride and ammonia in
ground and surface water and soil samples. Mr. Schucker expressed concern that during
the time the waste was being removed, the site would continue to leach chloride and
ammonia into the streams. He presented no alternative plan to remedy the groundwater
or surface water issue.

       StarLink’s next witness was Michael Bogdan, Director of Retained Environmental
Matters with Sante Fe, a healthcare company, of which StarLink was an indirect
subsidiary. Mr. Bogdan testified that he agreed with the proposed Amended Order’s
requirement that a berm be constructed, but insisted that it should have been done many
years ago and should be installed sooner than 120 days. He took issue with the proposed
Amended Order’s requirement that the plan “significantly reduce[]” the discharge of
contaminants via surface water and instead should have required a definitive amount of
reduction. He also stated that the proposed Amended Order should not provide for
reductions in discharge “to the extent practicable” but instead should have specific
requirements for ACC to meet. He then stated that the proposed Amended Order should
apply Tennessee water quality criteria to water leaving ACC’s property in addition to the
water entering the landfill excavation area.

       Mr. Bogdan testified that the crux of StarLink’s complaint with the proposed
Amended Order was that it allowed ACC to continue releasing untreated discharge into
Sugar Creek and onto StarLink’s property for at least four more years while the waste is
being removed. When asked about alternative remedies, Mr. Bogdan asserted that simply
removing the waste material would not solve the groundwater contamination on
StarLink’s property. He further stated that StarLink wanted the release of contaminated
discharge onto StarLink’s property to stop immediately and for any discharge leaving
ACC’s property to meet the Tennessee water quality criteria as outlined in the proposed
Amended Order. When asked about the specific technology StarLink was proposing to
meet these goals, Mr. Bogdan suggested that ACC construct a slurry wall around its
property line and extract and treat groundwater from behind the wall. When asked by a
Board member if there are karst4 formations on the property, Mr. Bogdan responded that

       4
          Karst is defined as “an irregular limestone region with sinkholes, underground streams, and
caverns.” Karst, Mirriam-Webster, http://www.merriam-webster.com/dictionary/karst (last visited April
12, 2016).

                                                 6
although karst formations existed on the property, he had not observed any in the
particular area of discussion. Mr. Bogdan stated that the capture of some groundwater
was possible and indicated that he thought contaminated discharge was leaving ACC’s
property through a retention pond.

       Dr. Schucker was recalled to testify and explained that bedrock formations existed
six to twenty feet below the surface, and it was unknown whether groundwater existed
below that level of bedrock. Based on the depth of bedrock, Dr. Schucker opined that
groundwater existing less than twenty feet below the surface of the bedrock could be
captured with a slurry wall, but Dr. Schucker had not performed a feasibility analysis on
that option. The cost was also unknown.

        ACC presented the testimony of Tom Grosko, who was employed by Smelter
Service, an aluminum recycling company in Maury County that is the sole member of
ACC’s limited liability corporation. Mr. Grosko testified that ACC’s objective was to
correct the situation by removing the waste from the landfill and stopping the
contaminated water from crossing the property line. He stated that ACC was not
financially able to remove the waste from the landfill and also treat water discharging
from the landfill. Therefore, ACC decided it was best to focus on the root cause of the
contamination by removing the waste. Counsel for StarLink asked Mr. Grosko if there
had ever been a proposal to pipe the water from the waste disposal site to other property
owned by ACC and if StarLink had offered to pay for the pipe. Mr. Grosko responded
that he had heard of the proposal, did not personally reject the idea, and did not recall
who had rejected it. Mr. Grosko later stated that no net environmental benefit would
result from piping the contaminated discharge from one area to another.

       ACC next presented the testimony of Mike Apple, retired director of the
Tennessee Division of Solid Waste Management, who had many years of experience
dealing with solid waste disposal facilities. Mr. Apple had reviewed the proposed
Amended Order and, in his opinion, the corrective action in the proposed Amended Order
would abate the problem, was reasonable, and was in the best interest of the public. Mr.
Apple testified that when ACC investigated potential solutions to the discharge problem,
it could not find the source of the water infiltrating the landfill. Mr. Apple stated that the
flow of groundwater, its direction, and its depth are all unknowns, which is the reason the
proposed Amended Order did not address water infiltration.

       ACC then presented further testimony from Ms. Sullivan. Ms. Sullivan testified
that under the first phase of ACC’s waste removal plan, ACC would work to redirect
groundwater infiltrating the landfill, which, if at least partly successful, would
immediately improve the quality of discharge leaving the landfill. This, combined with a
downgradient surface water impoundment, would improve the quality of the water
flowing into Arrow Lake. Ms. Sullivan admitted that the proposed Amended Order did
not provide for the evaluation of water entering Arrow Lake and any subsequent remedial

                                              7
action based on such an evaluation. Ms. Sullivan also admitted that the proposed
Amended Order provided for the sampling and testing of discharge from the landfill, but
did not provide for any specific action based on the results of these tests. Ms. Sullivan
further acknowledged that the proposed Amended Order did not provide for specific
criteria to determine the success of the proposed Amended Order. Upon examination by
TDEC, Ms. Sullivan explained that any plans called for by the proposed Amended Order
could be modified in the future.

        Upon further examination by StarLink, Ms. Sullivan stated that the proposed
Amended Order focused on capturing the water entering the landfill because it would be
more cost-effective than capturing the water leaving the landfill. Ms. Sullivan explained
that if the proposed Amended Order permitted water to enter the landfill area, the water
would have to be treated. The water, however, would not have to be treated if it was
captured before it entered the landfill. The proposed Amended Order contemplated that
the money saved by not treating the water entering the landfill would be used to remove
the landfill waste material.

        ACC’s last witness was Mr. Garden. ACC hired Mr. Garden’s employer, Barge,
Waggoner, Sumner & Cannon, to explore the most cost-effective way to treat the water.
Mr. Garden stated there was no possible way to completely remove both the ammonia
and salt content from the landfill discharge so as to comply with water quality standards
without taking all of the salt out of the water. The complete removal of the salt from the
discharge would leave a high saline water residue, requiring the residue to either be
dumped into a very large source of water or forced to evaporate. Mr. Garden testified
that ACC could not legally dump the residue and that high levels of heat would be needed
to evaporate the residue. Mr. Garden explained that he had explored ways to generate
heat sufficient to evaporate the residue, but all were too dangerous to justify. Moreover,
the cost to build a plant to treat the salt in the discharge would be the same whether built
before or after removing the waste material from the landfill. Even if such a plant were
built, it could only lower the level of salt leaving the landfill site by single percentage
points, which would make Mr. Garden unlikely to detect any impact from the plant on
Arrow Lake. Mr. Garden could not specify exactly when the benefit from removing the
waste might materialize.

        Upon examination by StarLink, Mr. Garden testified that there are multiple points
at which contaminated discharge leaves ACC’s property and enters StarLink’s property.
He believed that the volume of salt in the water leaving the landfill would exceed the
ability of the local wastewater treatment plant in Mt. Pleasant to handle and discharge the
water. Mr. Garden estimated the cost of a plant to treat 30,000 gallons of the most
concentrated discharge—a small portion of the flow—would cost about $5 million to
construct and about $700,000 annually to operate, depending on how the facility was
managed. Mr. Garden explained that the only facility known to him and ACC able to
handle the anticipated volume of discharge was in New Jersey.

                                             8
       During closing arguments, StarLink’s counsel mentioned the earlier proposal by
StarLink to pay to pipe discharging water away from Arrow Lake. Before the Board
began deliberations, the administrative law judge charged the Board members to make
their decision based on the sworn testimony of witnesses and exhibits introduced as
evidence.

        During deliberations, Board members discussed the pros and cons of the proposed
Amended Order. Board member Elaine Boyd commented that it would not make sense
for ACC to focus its financial resources on treating the symptom of contaminated
discharge when doing so would prohibit ACC from allocating its resources to the root
cause of the problem—the waste material. Board member Glenn Youngblood
commented that until the waste material in the landfill is addressed, all parties involved
would just be “spinning [their] wheels” and later commented that a consent order that
bankrupts ACC would benefit no one. Board member Michael Atchison echoed Board
member Youngblood’s concern. Board member Jared Lynn stated that even if a strategy
was implemented piping surface water discharge to another location, this would not
affect the continuing groundwater discharge and that removing the waste materials would
be the most effective use of ACC’s resources. Board member Mark Williams noted that
nothing in the proposed Amended Order eliminated TDEC’s ability to continue
enforcement actions. Board member Franklin Smith questioned why the proposed
Amended Order could not provide for a combination of remedies, combining the terms in
the consent order and StarLink’s proposal to pay to pipe discharging water to another
location. In response, Board member Boyd said that given the subsurface geological
conditions, she thought that there would be some complexity in capturing groundwater
leaving the site given all of the points of discharge. Board Chairman Ken Donaldson
noted that StarLink was willing to pay for the proposal to divert discharging water. Board
member Atchison responded that while it appeared StarLink offered to do so in the past,
it was unclear whether that offer still stood at the time of the hearing. Board member
Boyd commented that if the Board brought StarLink on as a party to the proposed
Amended Order for more negotiation, further delay would occur before the root source of
the problem—the waste material—was addressed. Upon a question by Board member
Youngblood, the administrative law judge informed the Board that StarLink had a private
right of legal action against ACC. The judge also informed the Board it could reopen the
record to hear further evidence if it wished to do so.

      The Board voted to approve the proposed Amended Order, stating in its Order that
“remediation of the ACC Landfill in the manner specified in the [proposed Amended
Order] is necessary to protect the health, safety and welfare of the public.” StarLink
appealed the Board’s decision to the Chancery Court for Davidson County. On January
29, 2014, the Davidson County Chancery Court affirmed the Board’s approval of the
proposed Amended Order. StarLink appealed.


                                            9
        In the Court of Appeals, StarLink asserted that the Davidson County Chancery
Court erred in affirming the Board’s approval of the proposed Amended Order, raising
four issues. On its own, the Court of Appeals raised the issue of “whether the Board’s
adoption of the [Amended] Order was in error where the Board failed to fully consider a
feasible and potentially economically viable plan that would contain the leachate
contamination from the landfill site from continued discharge into Sugar Creek and
Arrow Lake[.]” Starlink Logistics Inc. v. ACC, LLC, No. M2014-00362-COA-R3-CV,
2015 WL 1186311, at *4 & n.7 (Tenn. Ct. App. March 11, 2015); see also Tenn. R. App.
P. 13(b). The Court of Appeals reversed the Davidson County Chancery Court’s
decision, “find[ing] the Board’s decision to be arbitrary and capricious inasmuch [as] it
failed to fully consider the range of remedial options which were available and discussed
at the hearing before the Board.” Starlink Logistics Inc., 2015 WL 1186311, at *7. The
intermediate appellate court remanded the matter for further proceedings. Id. at *10.

       We granted the Board’s application for permission to appeal. The issue before us
is whether the Court of Appeals properly applied the narrow standard of review required
for judicial review of agency decisions under Tennessee Code Annotated section
4-5-322(h).

                                           II.
       It is not disputed that the Commissioner of TDEC had the authority to enter into a
consent order with ACC to remediate the closed landfill site. See Tenn. Code Ann.
§ 68-212-224(a)(1) (2011). Tennessee Code Annotated section 68-212-224(e) requires
the terms of such a consent order to be based on the criteria established in Tennessee
Code Annotated section 68-212-206(d). Those criteria provide:
      (1) In selecting containment and clean up actions, including monitoring and
      maintenance, . . . the commissioner shall evaluate reasonable alternatives
      and select those actions which the commissioner determines are necessary
      to protect public health, safety, and the environment. The goal of any such
      action shall be clean up and containment of the site through the elimination
      of the threat to the public health, safety, and the environment posed by the
      hazardous substance. In choosing the necessary actions at each site, the
      commissioner shall consider the following factors:
              (A) The technological feasibility of each alternative;
              (B) The cost-effectiveness of each alternative;
              (C) The nature of the danger to the public health, safety, and
              the environment posed by the hazardous substance at the site;
              and
              (D) The extent to which each alternative would achieve the
              goal of this subsection (d).

Tenn. Code Ann. § 68-212-206(d) (2011).
                                           10
       TDEC and ACC reached an agreement, contained in the proposed Amended
Order, for the cleanup of the landfill site. StarLink intervened and objected to the plan.
Following a contested hearing, the Board approved the proposed Amended Order.
StarLink, aggrieved by the Board’s decision, sought judicial review under Tennessee
Code Annotated section 4-5-322.

       The Uniform Administrative Procedures Act (“the Act”), Tenn. Code Ann.
§§ 4-5-101 to -404 (2011), sets forth the extent of judicial authority to review agency
decisions. See Tenn. Code Ann. §§ 4-5-301 to -325. Pursuant to Tennessee Code
Annotated section 4-5-322(b)(1)(A), StarLink filed a petition for judicial review in the
Chancery Court for Davidson County. StarLink alleged no procedural irregularities;
therefore, under section 4-5-322(g), the Davidson County Chancery Court’s review was
confined to the record, and no new proof was taken.

       The reviewing court’s standard of review is narrow and deferential. Wayne Cnty.
v. Tenn. Solid Waste Disposal Control Bd., 756 S.W.2d 274, 279 (Tenn. Ct. App. 1988).
The decision of the agency may be reversed or modified if the decision is shown to be:

      (1) In violation of constitutional or statutory provisions;
      (2) In excess of the statutory authority of the agency;
      (3) Made upon unlawful procedure;
      (4) Arbitrary or capricious or characterized by abuse of discretion or clearly
      unwarranted exercise of discretion; or
      (5)(A) Unsupported by evidence that is both substantial and material in the
      light of the entire record.
           (B) In determining the substantiality of evidence, the court shall take
           into account whatever in the record fairly detracts from its weight, but
           the court shall not substitute its judgment for that of the agency as to
           the weight of the evidence on questions of fact.

Tenn. Code Ann. § 4-5-322(h).

        This narrow standard of review, as opposed to the broader standard of review
applied in other appeals, reflects the general principle that courts should defer to
decisions of administrative agencies when they are acting within their area of specialized
knowledge, experience, and expertise. Tenn. Envtl. Council, Inc. v. Tenn. Water Quality
Control Bd., 254 S.W.3d 396, 401-02 (Tenn. Ct. App. 2007) (citing Willamette Indus.,
Inc. v. Tenn. Assessment Appeals Comm’n, 11 S.W.3d 142, 147 (Tenn. Ct. App. 1999);
Wayne Cnty., 756 S.W.2d at 279; CF Indus. v. Tenn. Pub. Serv. Comm’n, 599 S.W.2d
536, 540 (Tenn. 1980); Metro. Gov’t of Nashville v. Shacklett, 554 S.W.2d 601, 604
(Tenn. 1977)). Courts do not review questions of fact de novo and, therefore, do not
second-guess the agency as to the weight of the evidence. Humana of Tenn. v. Tenn.
Health Facilities Comm’n, 551 S.W.2d 664, 667 (Tenn. 1977); Grubb v. Tenn. Civil Serv.

                                           11
Comm’n, 731 S.W.2d 919, 922 (Tenn. Ct. App. 1987) (citing Tenn. Code Ann.
§ 4-5-322(h); Tenn. Code Ann. § 4-5-323; Reece v. Tenn. Civil Serv. Comm’n, 699
S.W.2d 808, 809 (Tenn. Ct. App. 1985)). This is true even if the evidence could support
a different result. Wayne Cnty., 756 S.W.2d at 279 (citing Hughes v. Bd. of Comm’rs,
319 S.W.2d 481, 484 (Tenn. 1958)).
        The Act makes clear that a reviewing court shall not substitute its judgment for
that of the agency as to the weight of the evidence on questions of fact. Tenn. Code Ann.
§ 4-5-322(h)(5)(B). An appellate court applies the same limited standard of review as the
trial court. Davis v. Shelby Cnty. Sheriff’s Dep’t, 278 S.W.3d 256, 264 (Tenn. 2009);
Ware v. Greene, 984 S.W.2d 610, 614 (Tenn. Ct. App. 1998).
       A decision of an administrative agency is arbitrary or capricious when there is no
substantial and material evidence supporting the decision. Pittman v. City of Memphis,
360 S.W.3d 382, 389 (Tenn. Ct. App. 2011); Jackson Mobilphone Co. v. Tenn. Pub. Serv.
Comm’n., 876 S.W.2d 106, 110 (Tenn. Ct. App. 1993). The statute does not define
“substantial and material evidence,” but it is less than a preponderance of the evidence,
Wayne Cnty., 756 S.W.2d at 280 (citing Consolo v. Fed. Maritime Comm’n, 383 U.S.
607, 620 (1966)), and more than a “scintilla or glimmer” of evidence, id. (citing Pace v.
Garbage Disposal Dist., 390 S.W.2d 461, 463 (Tenn. Ct. App. 1965)). A decision with
evidentiary support can be arbitrary or capricious if it amounts to a clear error in
judgment. City of Memphis v. Civil Serv. Comm’n, 216 S.W.3d 311, 316 (Tenn. 2007)
(citing Jackson Mobilphone Co., 876 S.W.2d at 110). A decision is arbitrary or
capricious if it “is not based on any course of reasoning or exercise of judgment, or . . .
disregards the facts or circumstances of the case without some basis that would lead a
reasonable person to reach the same conclusion.” Civil Serv. Comm’n, 216 S.W.3d at
316 (quoting Jackson Mobilphone Co., 876 S.W.2d at 111). “If there is room for two
opinions, a decision is not arbitrary or capricious if it is made honestly and upon due
consideration, even though [a reviewing court] think[s] a different conclusion might have
been reached.” Bowers v. Pollution Control Hearings Bd., 13 P.3d 1076, 1083 (Wash.
Ct. App. 2000) (citing Buechel v. Dep’t of Ecology, 884 P.2d 910, 915 (Wash. 1994) (en
banc)) (explaining the “arbitrary or capricious” standard under Washington’s version of
the Uniform Administrative Procedures Act). The “arbitrary or capricious” standard is a
limited scope of review, and a court will not overturn a decision of an agency acting
within its area of expertise and within the exercise of its judgment solely because the
court disagrees with an agency’s ultimate conclusion. See id. (citing Buechel, 884 P.2d
910 at 915).
       Applying this limited standard of review to the Board’s decision, we hold that the
decision was not arbitrary or capricious. The Board, relying on its expertise and
experience, carefully considered the evidence presented to it. The Board’s decision was
fully supported by substantial and material evidence. It was based on reasoning and
exercise of judgment and did not disregard any facts, without some basis, that would lead
a reasonable person to reach the same result. While the Board may have chosen other

                                            12
remedies, its decision was sound, well-reasoned, and supported by the evidence. The
Board’s decision was not arbitrary merely because the reviewing court might have
reached a different decision.
        For more than eight years, TDEC and ACC wrestled with the problem of
contaminated water leaving the landfill site and entering Sugar Creek and Arrow Lake.
ACC thoroughly investigated the condition of the landfill and its hydrogeology features,
compiled data on the landfill site and remedial options, prepared and submitted reports to
TDEC, reviewed the feasibility and effectiveness of various remediation options, and
unsuccessfully attempted multiple remediation efforts. The issue of leachate flowing out
of the landfill was clearly a difficult problem to resolve. In 2011, TDEC and ACC
arrived at a solution that they considered to be reasonable, feasible, cost-effective, and
practical. In simple terms, the agreement required ACC to divert water from entering the
landfill site and, over a four-year period, remove all of the waste from the landfill and
relocate it to an approved landfill cell on its property or to a permitted off-site location.
This plan of action was supported by expert testimony. StarLink’s primary bone of
contention was that the proposal did not require ACC also to divert or treat water leaving
the landfill site during the waste removal process. StarLink, arguing that more should be
done to prevent contaminated water from flowing into Arrow Lake, offered no other
feasible alternative plan. During the Board hearing, StarLink’s counsel referenced a
diversion option during cross-examination of ACC’s witness, Mr. Grosko:
       Q: And so what I’m asking you now is, why aren’t we focusing on
       diverting the water below?
       A: Around what? If it’s already been through the landfill, I don’t
       understand.
       Q: There is polluted water coming out the other side.
       A: Yes, sir.
       Q: Would there be a way to divert the water coming out the other side?
       A: To?
       Q: I guess, has there ever been a proposal to pipe the water to other
       property that you own?
       A: I believe so, yes.
       Q: And did [StarLink] not propose paying for that pipe so that the water
       could be diverted to other land that you own?
       A: I’ve heard that, yes.
       Q: And so that proposal was rejected, because you don’t want that polluted
       water any more than [StarLink] does, do you?
       A: I personally didn’t reject it, no.
       Q: So who rejected it?
       A: I don’t recall.
       Q: So no cost solution that would have moved the polluted water away
       from Arrow Lake to your property was rejected?
       A: I don’t recall.
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        When subsequently questioned by TDEC, Mr. Grosko testified that no net
environmental benefit would result from piping discharge away from Arrow Lake to
another location. Upon inquiries by two Board members, Mr. Grosko reiterated that he
could not recall the details of StarLink’s piping proposal and that the landfill waste would
still have to be addressed. StarLink’s counsel mentioned the proposal during closing
arguments and suggested that ACC construct a seepage-proof retention pond and divert
discharging water to that location in addition to treating the water. This, however, was
merely argument and not evidence on which the Board could base its decision. See
Oakes v. Oakes, 235 S.W.3d 152, 158 (Tenn. Ct. App. 2007) (citing State v. Roberts, 755
S.W.2d 833, 836 (Tenn. Crim. App. 1988)) (explaining that arguments and statements by
counsel during a hearing are not evidence).
        ACC presented proof that it could not afford to remove the waste material and also
divert or treat the water flowing out of the landfill. Mr. Apple, the former director of the
Division of Solid Waste Management, explained that the proposed Amended Order did
not address the issue regarding water flowing out of the landfill because the flow,
direction, and depth of the groundwater were not known. Mr. Garden testified that
contaminated discharge leaves ACC’s property at multiple points, and there was no
single point of contact between the landfill waste and groundwater. He discounted the
feasibility and effectiveness of treating the water leaving the landfill. Ms. Sullivan
testified that the proposed plan focused on capturing the water entering the landfill
because it would be more cost-effective than capturing the water leaving the landfill.
       The record reflects that the Board gave fair consideration to the diversion option.
Two Board members made inquiries in response to StarLink’s counsel’s
cross-examination questions regarding StarLink’s purported proposal to pay for piping.
During deliberations, Board members commented that piping off surface water would not
address groundwater discharge, that capturing and piping water would be complex given
subsurface geological conditions, and that negotiating a piping proposal would add
further unnecessary delay to addressing the problem. Board member Smith suggested
that the ideal solution would be to perform actions in the proposed Amended Order and
divert discharge elsewhere through pipes at StarLink’s expense. After discussion, the
Board voted to approve the proposed Amended Order. The Board decided it was
necessary to address the root cause of the problem, avoid unnecessary delay, and that the
geological conditions would make any piping proposal difficult to implement or, at best,
only partially effective. The Board also noted that it would be in no one’s interest to
bankrupt ACC by requiring it to divert and treat the water. The Board did not spend a
great deal of time discussing the diversion option primarily because StarLink failed to
present any evidence that the piping alternative was feasible or would be effective.
During oral argument before this Court, counsel for StarLink acknowledged that StarLink
was not advocating for the piping diversion remedy. Clearly, the Board considered the
evidence and made a reasonable decision.



                                            14
       The Court of Appeals, in rejecting the Board’s decision and remanding the case to
the Board to explore more options, misapplied the arbitrary or capricious standard and
instead substituted its judgment for that of the Board. The Court of Appeals determined
that the Board’s decision “failed to give any significant consideration to an option that
would divert the flow of pollutants from discharge into waters of the [S]tate.” Starlink
Logistics Inc., 2015 WL 1186311, at *6. This, according to the Court of Appeals,
rendered the Board’s decision arbitrary, capricious, and “a clear error in judgment.” Id.
at *10. The primary “option” the intermediate appellate court determined the Board
should have more carefully considered was the diversion of water before it entered Sugar
Creek by piping the water elsewhere. The evidence relied on by the Court of Appeals
was a reference by StarLink’s counsel to a piping proposal while cross-examining ACC’s
representative, Mr. Grosko, wherein Mr. Grosko acknowledged hearing about a proposal
by StarLink to pay for the piping. From the brief exchange, the Court of Appeals
concluded:
       Assuming StarLink is still willing to pay for the pipe(s) necessary to divert
       the water, it would be unreasonable to not implement the diversion plan,
       under which leachate would be contained on ACC’s property rather than
       continually polluting the waters of the [S]tate. ACC has sufficient
       remaining acreage outside of the landfill that could host a retention pond or
       other storage for the leachate, and this should not be ignored at the expense
       of continued pollution to waters of the [S]tate.
Id. at *9.
      Calling the piping option a “feasible and potentially economically viable
complement to the plan,” the Court of Appeals remanded the case back to the Board to
hear proof on StarLink’s willingness to pay for the pipe, the estimated costs of
implementing the plan, and ACC’s economic ability to implement the piping plan. Id. at
*10. Respectfully, this search for a solution was not within the province of the Court of
Appeals. The Board did not ignore the testimony regarding the piping option, but
considered and rejected it as a viable solution.
                                         III. Conclusion
      The Court of Appeals failed to properly apply the judicial review provisions of
Tennessee Code Annotated section 4-5-322(h) and substituted its judgment for that of the
Board. We reverse the decision of the Court of Appeals and remand this case to the
Court of Appeals for consideration of the issues it pretermitted.5 Costs of this appeal are
       5
           Amici Curiae argue before this Court that the Board’s approval of the Amended Order was
arbitrary and capricious because the Amended Order does not require ACC to obtain a National Pollutant
Discharge Elimination System (“NPDES”) permit. Amici contend that an NPDES permit requirement
would ensure opportunity for the public to comment and participate in the development of plans to
address the discharge of pollutants into Arrow Lake. Because we remand this matter to the Court of
Appeals for review of pretermitted issues, we do not reach the issue raised by the Amici.

                                                 15
taxed to StarLink Logistics Inc. and its surety, for which execution shall issue if
necessary.


                                                ______________________________
                                                SHARON G. LEE, CHIEF JUSTICE




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