                                                               •• tILED
                                                              COURT OF APPEALS OW I
                                                               STATE OF WAStiltIGTON

                                                               2010 MAY 14 Ali 9; 1

       IN THE COURT OF APPEALS FOR THE STATE OF WASHINGTON



THE PUYALLUP TRIBE OF INDIANS, )
a Federally Recognized Indian Tribe, )
                                     )                    No. 77748-3-1
                    Appellant,       )
                                     )                    DIVISION ONE
       v.                            )
                                     )
WASHINGTON STATE SHORELINES )
HEARINGS BOARD, CITY OF              )
TACOMA,a Washington Municipal        )
Corporation, PUGET SOUND ENERGY,)
INC., a Washington Corporation,
PORT OF TACOMA, a Washington         )
Special Purpose District and         )
WASHINGTON STATE                     )
DEPARTMENT OF ECOLOGY,               )                    UNPUBLISHED OPINION
                                     )
                    Respondents.     )                    FILED: May 14, 2018

        SPEARMAN, J. — We review decisions of the Shorelines Hearings Board to

determine if the Board's factual findings are supported by substantial evidence

and if these findings, in turn, support the Board's conclusions of law. The

Puyallup Tribe of Indians appeals the Shorelines Hearings Board's decision to

affirm a shoreline substantial development permit. But because the Board's

decision is supported by substantial evidence, we affirm.1



         1 Shortly before oral argument, Puget Sound Energy(PSE)filed, as supplemental
authority, a decision of the Shorelines Hearing Board in a separate appeal of a Department of
Ecology permit. PSE directed the court's attention to the background facts. The Tribe filed a
motion to strike on the grounds that the background facts recited in the decision are not authority.
We agree with the Tribe and grant the motion.
No. 77748-3-1/2

                                       FACTS

       Puget Sound Energy(PSE) proposes to build a liquefied natural gas

(LNG)facility near the Blair and Hylebos Waterways in Tacoma. The Blair and

Hylebos are man-made inlets excavated from Commencement Bay. The

Puyallup Tribe of Indians owns property along both waterways. The Tribe also

has treaty rights to fish and shellfish in the Blair and Hylebos.

       The land around the Blair and Hylebos Waterways has long been used for

heavy industry. This industrial use has degraded conditions in the waterways. In

1983, the Environmental Protection Agency(EPA) listed the Blair and Hylebos

Waterways as national priorities (superfund sites). The Blair Waterway was

dredged to remove contaminated sediment between 1993 and 1995. Following

this action, the EPA removed the Blair from the national priorities list. The

Hylebos remains a national priority.

       The PSE project involves a land-based LNG processing facility connected

by a pipeline to a fueling station in the Blair Waterway. Originally, the project also

involved a barge-loading dock on the Hylebos Waterway. As originally planned,

the project entailed removing a number of old, creosote-treated piles in both

waterways and replacing a dock and bulkhead on the Hylebos.

The Environmental Impact Statement

       Under the State Environmental Policy Act, the project required an

Environmental Impact Statement (EIS). The City of Tacoma prepared a draft EIS,

notified the public, and sought comments. The Department of Ecology and the

EPA both submitted comments. Ecology noted that removing existing piles will

release sediment into the water. Ecology recommended that PSE consult with

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No. 77748-3-1/3

the Department of Natural Resources and the EPA to determine the best

approach for this work. Ecology further commented that, "[i]n general, EPA

should be consulted about all in-water construction in the Hylebos Waterway

problem area." Administrative Record (AR)at 1074.

       In its comments, the EPA expressed concern with the proposed work on

the Hylebos. EPA stated that some areas of the Hylebos had been designated

"monitored natural recovery" areas. AR at 1832. These areas were expected to

remain undisturbed so that clean sediment could settle over and contain

contaminated sediment. The EPA stated that it had asked PSE to summarize the

existing data, identify data gaps, and develop a draft sampling and analysis plan

to characterize sediment quality at the Hylebos project site. The EPA

recommended that the final EIS should describe the uncertainty about sediment

quality in the Hylebos, state that construction sequencing and design depend

upon sediment and soil quality, and, in some places, sediment and/or soil

removal may need to precede construction. The EPA did not express concerns

about sediment in the Blair.

       The City issued a final EIS evaluating the impact of the project in several

categories. The EIS concludes that, in the long term, replacing creosote-treated

piles will improve water quality. While removing the piles may temporarily disturb

sediment and re-suspend contaminates, this effect is short term and will last

about two tide cycles. The project will also result in a long term benefit to aquatic




                                          3
No. 77748-3-1/4

life by reducing the total number of piles, decreasing the total area of over water

coverage, and increasing benthic habitat.2

       The EIS recommends employing best management practices(BMPs)to

avoid or minimize the impact of sediment disturbance. BMPs include using a

vibratory hammer to remove piles without disturbing sediment; cutting any broken

piles two feet below the mud line and filling the hole with clean fill; limiting in-

water construction to a window when the fewest fish are present; installing a silt

curtain around the pile removal area to prevent sediment from migrating beyond

the project footprint; and containing all removed sediment and creosote-treated

wood. The EIS concludes that, with these BMPs, the project is likely to improve

water quality and unlikely to have an adverse effect on aquatic life.

PSE's JARPA application

       In addition to the EIS, the project requires shoreline and development

permits from the City of Tacoma. CP at 29-30, 34. The project also requires

permits from the Washington State Department of Ecology, the Washington State

Department of Fish and Wildlife, and the Army Corps of Engineers. CP at 33-34.

While the EIS process was taking place, PSE submitted a master application

(Joint Aquatic Resources Permit Application or JARPA)for these permits. Id.

Each entity began its own review.

       The Army Corps of Engineers reviewed the project for compliance with

federal environmental acts. The Army Corps received input from a number of

other agencies, including the EPA. The EPA did not express concerns about in-


       2 The benthic zone is the lowest level of a body of water. WEBSTER'S THIRD NEW
INTERNATIONAL DICTIONARY 204(2002).

                                              4
No. 77748-3-1/5

water work in the Blair but commented that in-water work in the Hylebos should

not occur without sediment testing. The EPA stated that the results of this testing

may result in changes to the design of the project or the sequence of work. The

Army Corps adopted the EPA's conditions.

      The City reviewed PSE's application to determine if the project complied

with Tacoma's Shorelines Master Program (TSMP). Under the TSMP,

development on the shoreline must result in no net loss of ecological function.

The City concluded that, if PSE adheres to BMPs and conditions imposed by

other agencies, the project will meet this standard. The City issued a shoreline

substantial development permit(SSDP).

      The Tribe asked the City to reconsider, asserting that the City failed to

adequately consider impacts to ecological function. In particular, the Tribe argued

that the City had not considered the risk of spreading contaminated sediment in

the Hylebos.

      The City granted the Tribe's motion in part. The City stated that the SSDP

erroneously omitted the standard condition that the applicant must obtain all

other agency permits and comply with any conditions imposed before the City will

issue development(construction or demolition) permits. The City noted that both

the Department of Ecology and the EPA had identified a risk from disturbing

contaminated sediment in the Hylebos and sediment testing would be required

prior to federal and state permitting. The City modified the SSDP to require PSE

to (1) secure all required agency permits before seeking development permits

from the City;(2) demonstrate that sediment testing has been completed and



                                         5
No. 77748-3-1/6

water quality regulations are met before beginning work in the Hylebos; and (3)

obtain City approval of any modifications to the mitigation plan. Id. at 675.

The Tribe's appeal to the Shorelines Hearings Board

       The Tribe timely appealed to the Shorelines Hearings Board, naming the

City, PSE, the Port of Tacoma, and the Department of Ecology as respondents.

The Tribe primarily objected that the City failed to adequately assess the impact

of work on the Hylebos and improperly delegated its responsibility to other

agencies. The Tribe also argued that PSE's mitigation plan was inadequate.

       A few days after the Tribe filed its appeal, PSE filed a stipulation stating

that it would eliminate the barge-loading dock on the Hylebos. PSE stated that it

would carry out mitigation measures in the Hylebos by removing overwater

decking and improving storm water drainage but perform no construction in that

waterway.

       The Tribe objected to the stipulation as a substantial change to the project

that required a new permit application. The Tribe asserted that the purpose of the

stipulation was to avoid scrutiny at the Hylebos site and PSE would likely revoke

the stipulation after it served that purpose. The Tribe also argued that PSE

intended to relocate the barge-loading dock to the Blair, increasing the scope of

work on that waterway and requiring formal review. The Tribe asked the Board to

reverse the issuance of the SSDP and remand to the City.

       PSE asserted that it was bound by the stipulation, which voluntarily

reduced the scope of the LNG project. PSE stated that it was eliminating the

barge-loading dock, not transferring it, and the elimination of this component did

not require a new permit application.

                                          6
No. 77748-3-1/7

       The Shorelines Hearings Board denied the Tribe's motion to remand but

identified the Tribe's objections to the stipulation as issues on appeal. In a

prehearing order, the Board also set various deadlines. The Board set April 25 as

the deadline to exchange a list of exhibits.

       On April 25, PSE submitted as an exhibit its revised JARPA application.

Consistent with the stipulation, the revised project eliminates the barge-loading

dock but retains mitigation on the Hylebos by removing overwater decking on

that waterway. Construction in the Blair Waterway remains the same as originally

proposed. The revised project includes additional mitigation at the Sperry Dock.

       The parties presented evidence at a five-day hearing. The Tribe's experts

testified that removing the existing piles will disturb potentially contaminated

sediment, posing a danger to fish. The Tribe's environmental geochemist, Janet

Knox, testified that contaminates had been found in many areas in

Commencement Bay, including near the Blair project site. Knox opined that the

City could not accurately assess environmental impact without requiring analysis

of the sediment at the project site. In Knox's opinion, the identified BMPs are

inadequate because they do not require monitoring. Knox opined that BMPs

must be implemented in combination with other water quality criteria. Knox

acknowledged that she had not visited the Blair site and her opinion as to

contamination was drawn from data that was 20 to 30 years old. She stated that

sediment testing is generally done under the supervision of the Army Corps or

the EPA. Knox was not aware of any local jurisdiction requiring sediment testing.

       Shane Cherry, a Tribe consultant, testified that he was concerned about

the lack of sediment analysis. Cherry also stated that the Army Corps or the EPA

                                          7
No. 77748-3-1/8

must approve sediment testing. Tad Deshler, a Tribe consultant, testified that

PSE's proposed mitigation plan was inadequate. Deshler evaluated the

mitigation measures using a habitat equivalency analysis (HEA).

       Russell Ladley, a Tribe biologist, stated that removing creosote-treated

piles is beneficial. He acknowledged the EPA's position that, if BMPs are

employed, removing piles is unlikely to disturb subsurface contaminates. Ladley

stated that he disagreed with the EPA in this matter. Ladley testified that he had

never observed or supervised pile removal and his opinion was based on what

he had read. Char Naylor, the Tribe's water quality manager, also stated that

removing creosote-treated piles benefits water quality. He opined that BMPs are

effective if followed as written but expressed concern that PSE would not adhere

to the identified BMPs.

       In response, PSE and the City presented their experts. PSE's expert

geologist, Rick Moore, testified that there is little risk of contaminated sediment at

the Blair project site. He stated that the data does not indicate a risk that would

trigger sediment testing. Moore's opinion was based on data from the last ten

years. Moore also testified to the effectiveness of BMPs at reducing sediment

disturbance and preventing the spread of contaminates. Moore stated that the

identified BMPs are approved for removing piles in locations with contaminated

sediments. He stated that it was not necessary to analyze the sediment before

employing these BMPs. Moore described his personal experience removing piles

and stated that he had never seen the BMPs prove ineffective.

       Moore also stated that the project is subject to intensive water-quality

monitoring as a condition of its Army Corps permit, which includes a Water

                                          8
No. 77748-3-1/9

Quality Protection and Monitoring Plan. In Moore's opinion, the project will

improve water quality by removing the creosote. The project will also improve

ecological function by dissipating wave energy, discouraging erosion, and

stabilizing the bank.

       Matthew Boyle, a biologist, testified to the effectiveness of confining work

to a fish window. Boyle stated that, in Commencement Bay, the fish window is

more than 90 percent effective in protecting anadromous fish.3 Boyle also

testified to the proposed mitigation plan. He stated that the HEA model used by

the Tribe's expert is designed for a different purpose. Boyle disputed its

applicability to shoreline mitigation. In Boyle's opinion, the revised mitigation plan

accounts for different habitat values, offsets unavoidable impacts, and results in

a net benefit for ecological function.

       Larry Tornberg, a PSE permitting manager, stated that PSE has restricted

its work to a fish window shorter than that approved by the Army Corps. Tornberg

also stated that PSE is required to comply with the most current BMPs identified

by the EPA and any other conditions imposed in agency permits. Tornberg

testified that the earliest draft of PSE's Water Quality Protection and Monitoring

Plan did not include instrumented monitoring during pile removal. He stated that

the Department of Ecology raised concerns and, in response, PSE revised the

plan to include monitoring during pile removal.

       Shannon Brenner, the City's environmental specialist, stated that the PSE

project avoids environmental impact in all but the overwater component. Brenner


       3 Anadromous fish are those that ascend rivers from the sea to spawn. WEBSTER'S THIRD
NEW INTERNATIONAL DICTIONARY 58(2002).


                                             9
No. 77748-3-1/10

determined that the proposed mitigation more than offsets the impact of the

overwater component so that, in its entirety, the project meets the no net loss

standard. Brenner testified that the EPA is the lead agency for sediment testing

in Commencement Bay and the City relies on the EPA's recommendations as to

sediment quality. She stated that the City has never required sediment analysis

on its own authority and could not do so without approval from the Army Corps

and the Department of Ecology. Brenner also stated that the HEA model is not

applicable to shoreline permitting and has never been accepted by the City.

        James Thornton, an expert in sediment contamination, testified that local

governments sometimes work with the EPA, Ecology, and the Army Corps to

conduct sediment testing in the context of determining their own liability. He

stated that a local government would have to go through Ecology or the Army

Corps to use sediment samples in a regulatory setting. Thornton stated that the

current consensus is that creosote piles should be removed. He testified that,

when BMPs are followed, removing piles does not bring up contaminated

sediment. Thornton testified that the EPA's concern with sediment contamination

in the Hylebos involved the removal of an existing bulkhead. According to

Thornton, the EPA recommended testing to determine whether sediment behind

the bulkhead was contaminated.

        The Board's order includes 52 findings of fact and 26 conclusions of law.

As an initial matter, the Board determined that the Tribe had standing.4 As to the


       4 The Port challenges the Board's conclusion that the Tribe has standing to appeal the
SSDP. But because the Port did not identify the issue in a notice of appeal, we do not consider it.
RAP 2.4(a).



                                                10
No. 77748-3-1/1 1

merits, the Board found that aquatic habitat in the Blair is currently degraded,

removing the creosote-treated piles will benefit water quality, BMPs will minimize

the impact of removing the piles, and any sediment disturbance will be short

term. The Board found that the evidence did not establish the presence of

sediment contamination at the project site or demonstrate that the identified

BMPs are insufficient to protect water quality. The Board found that PSE's

mitigation plan follows the sequence of avoidance, minimization, and

compensation; the City followed its standard approach in evaluating the

proposed mitigation; and the mitigation plan is adequate to achieve no net loss of

ecological function.

       The Board concluded as a matter of law that the City did not err in

determining that the project met the no net loss standard. The Board also

concluded that the City did not err in relying on agency expertise to address

potential sediment contamination. The Board affirmed the SSDP.

                                   DISCUSSION

       The Tribe challenges the Board's decision, asserting that it is unsupported

by facts, was procedurally flawed, violates Tacoma's master program, and is

inconsistent with Washington's Shoreline Management Act(SMA), chapter 9.58

RCW.

       The SMA envisions "a planned, rational, and concerted effort, jointly

performed by federal, state, and local governments, to prevent the inherent harm

in an uncoordinated and piecemeal development of the state's shorelines." RCW

90.58.020. Under the SMA, local governments must create a "master program,"

approved by the Department of Ecology, for regulating shoreline development in

                                         11
No. 77748-3-1/12

a manner consistent with the SMA. RCW 90.58.080(1), .080(3). The local

government has exclusive authority to administer and enforce a permit system

under its master program. RCW 90.58.140(3).

      Tacoma's shoreline master program (TSMP)is codified in part as chapter

13.10 of the Tacoma Municipal Code. To issue an SSDP,the City must

determine that proposed shoreline development complies with the TSMP. TMC

13.10.2.3.1.2. A purpose of the TSMP is to "[e]nsure, at minimum, no net loss of

shoreline ecological functions and processes... ." TMC 13.10.1.2.5. Where

modification to a shoreline is permitted, "all adverse impacts resulting from a

development proposal or alteration shall be mitigated so as to result in no net

loss of shoreline and/or critical area functions or processes." TMC

13.10.6.4.2.C.1. Mitigation requires avoiding environmental impact where

practicable, minimizing unavoidable impacts, and compensating for adverse

impacts. TMC 13.10.6.4.2.C.2. Adverse impacts in one location may be offset by

compensatory mitigation in other areas. TMC 13.10.6.4.C.2.e.

       Under the TSMP,the Blair and Hylebos Waterways are part of a

designated "Port Industrial Area" zoned for continued industrial development.

TMC 13.10.9.12. The Port Industrial Area is a "high-intensity environment." TMC

13.10.5.5.5, TMC 13.10.9.12. High-intensity environments provide for

commercial and industrial development "while protecting existing ecological

functions and restoring ecological functions in areas that have been previously

degraded." TMC 13.10.5.5.5.A. In high-intensity areas, "[Nolicies and regulations

shall assure no net loss of shoreline ecological functions as a result of new

development." TMC 13.10.5.5.5.D.3.

                                         12
No. 77748-3-1/13

       A party aggrieved by the City's decision to grant or deny an SSDP may

appeal to the Shorelines Hearings Board. RCW 90.58.180(1). The Shorelines

Hearing Board is a quasi-judicial administrative body with specialized skill in

hearing shoreline cases. Buechel v. Dep't of Ecology, 125 Wn.2d 196, 204, 884

P.2d 910(1994). The Board reviews the issuance of an SSDP de novo. Id. at

202.

       Our review of the Board's decision is governed by the Administrative

Procedure Act(APA), chapter 34.05 RCW. RCW 90.58.180(3). Under the APA,

the appellant has the burden of demonstrating that the Board's action was

invalid. RCW 34.05.570(1)(a). We accord deference to the Board's "specialized

knowledge and expertise." Buechel, 125 Wn.2d at 203.

Sediment testing and the no net loss standard

       The Tribe contends the Board erred in concluding that PSE's project

meets the no net loss standard. The Tribe challenges the Board's findings that

removing the creosote-treated piles will benefit water quality, the evidence did

not establish the presence of sediment contamination at the project site, BMPs

will minimize sediment disturbance, the proposed mitigation is adequate, and the

project will result in no net loss of ecological function. The Tribe challenges the

Board's related conclusions that the project meets the TSMP's no net loss

standard and the City did not err in deferring the issue of sediment testing to

other agencies.

       The parties agree that whether a project causes a loss of ecological

function is a question of fact. We will affirm an agency's findings of fact if they are

supported by substantial evidence. RCW 34.05.570(3)(e). Evidence is substantial

                                          13
No. 77748-3-1/14

where it is sufficient to persuade a fair-minded person. de Tienne v. Shorelines

Hearings Board, 197 Wn. App. 248, 276, 391 P.3d 458 (2016). We defer to the

Board's decisions concerning the weight of conflicting evidence. Id. Where an

agency decision is made in willful "'disregard of facts and circumstances," it is

arbitrary and capricious and must be reversed. Id. at 277 (quoting Buechel, 125

Wn.2d at 202). A decision is not arbitrary and capricious where it reflects due

consideration of conflicting opinions. Id.

       The Tribe asserts that the Board lacked material information concerning

sediment characterization. Without this information, the Tribe contends, the

Board's decision that the project meets the no net loss standard is arbitrary and

capricious. The Tribe argues that this case in analogous to de Tienne, In that

case, the Shorelines Hearings Board revoked a permit because there was no

scientific basis supporting the local government's decision. de Tienne, 197 Wn.

App. at 288.

       PSE contends the Board's decision is based on substantial scientific

evidence and this case is thus unlike de Tienne. PSE asserts that, while the

Tribe is focused exclusively on sediment testing, neither the Tacoma code nor

the SMA require sediment testing as part of the no net loss determination. PSE

argues that the Board did not act in the absence of information but based its

findings on extensive evidence that the project, viewed in its entirety, will not

cause a net loss of ecological function over time.

       We agree with PSE. The Board heard evidence concerning the risk of

disturbing contaminated sediment, indications of contamination at the project

site, the effectiveness of BMPs, and the adequacy of mitigation. The Board

                                         14
No. 77748-3-1/15

summarized and weighed the conflicting evidence in its decision. The Board

found persuasive the respondents' evidence that there is a low risk of

contamination at the project site, the identified BMPs adequately protect against

that risk, any adverse impact will be short term, the proposed mitigation offsets

adverse impacts, and, in the long term, the project will benefit the waterway's

ecological function.

       The Board's findings are supported by substantial evidence. The findings,

in turn, support the conclusion that the project meets the TSMP's no net loss

standard. We reject the Tribe's argument that the Board's decision has no factual

or scientific basis.

       The Tribe next argues that the Board erred by relieving the City of the

responsibility to conduct sediment testing. In its order, the Board summarized the

evidence that the City had never required sediment testing and lacked the

authority to do so. The Board concluded that the City did not err in relying on the

expertise of other agencies to address potential sediment contamination. The

Board accorded weight to the City's longstanding interpretation of the TSMP and

concluded that the City did not violate the SMA or the TSMP by deferring the

issue of sediment testing to other agencies.

       The Tribe argues that this was error. The Tribe asserts that the City is the

only entity bound by the TSMP,the only entity responsible for making a no net




                                        15
No. 77748-3-1/16

loss determination, and therefore the entity required to assess sediment quality.5

We reject this argument.

       The Board heard extensive evidence that the City does not have the

authority to require sediment testing. The City's environmental specialist testified

that the City has never required sediment analysis on its own authority and could

not do so without approval from the EPA, the Army Corps, or the Department of

Ecology. She stated that the EPA is the lead agency for sediment testing and the

City relies on its recommendations. The Tribe's experts testified that sediment

testing requires approval from the Army Corps or the Department of Ecology.

They stated that they were not aware of any local government that required

sediment testing as part of a shoreline development permit. The Board did not err

in concluding that the City cannot require sediment testing on its own authority

and that the City properly relies on other agencies as to sediment quality.6

Evidence outside the record

        Next, the Tribe contends the Board erred by relying on evidence outside

the record. The Tribe asserts that the Board relied on PSE's Water Quality

Protection and Monitoring Plan, which was excluded from evidence. The

argument is without merit.




        5 Notably, the Tribe does not challenge the Board's conclusions that multiple agencies
have concurrent jurisdiction over shoreline resources and that the City conditions development
permits on compliance with state and federal permits.
        6 The Tribe asserts that the modified SSDP, which expressly conditions the project upon
PSE completing sediment analysis in the Hylebos, demonstrates that the City has authority to
require sediment testing. We disagree. In comments to the Department of Ecology and the Army
Corps, the EPA conditioned approval on sediment testing in the Hylebos. The City included the
condition in the modified SSDP to make clear that the City's permit was conditioned on PSE's
compliance with conditions imposed by other agencies.


                                              16
No. 77748-3-1/17

       At the hearing, the Tribe's expert, Janet Knox, testified that the BMPs are

inadequate because they do not require water quality monitoring during pile

removal. In response, Rick Moore testified that the project is subject to intensive

monitoring as part of its Water Quality Protection and Monitoring Plan, which is

required by the Army Corps. Larry Tornberg also addressed Knox's concern with

monitoring. Tornberg stated that the first version of the Water Quality Protection

plan did not require instrumented monitoring during pile removal. He stated that,

in response to concerns raised by the Tribe and the Department of Ecology, PSE

revised the plan to include intensive monitoring. Tornberg testified that Ecology

raised its concerns the week before the hearing and PSE submitted its revisions

the week of the hearing. PSE offered the revised plan as an exhibit. The Board

declined to admit it because the Tribe had not yet seen it and PSE did not

include the plan in its list of exhibits.

       The Board's decision summarizes the testimony of Knox, Moore, and

Tornberg concerning monitoring. Referencing Tornberg's testimony, the Board

stated that "the Water Quality and Protection Plan, recently submitted to Ecology

for its review and approval, provides for instrumented monitoring of pile removal."

Id. at 43. The Board also stated:

          Mr. Moore also disagreed with Ms. Knox's criticisms of the
       Water Quality Protection and Monitoring Plan. Mr. Moore testified
       that he participated in the preparation of the Plan and that it
       requires intensive instrumented monitoring. Moore Testimony. Mr.
       Tornberg testified that PSE revised the Water Quality Protection
       and Monitoring Plan to address the Tribe's concerns and recently
       submitted the revised Plan to Ecology for its review and approval.
       The Plan will become part of the 404 Permit decision issued by the
       Corps for in-water construction.

Id. at 50.

                                            17
No. 77748-3-1/18

       The Board relied on testimony concerning water monitoring. The Tribe did

not object to the testimony. There was no error.

Changes to the project

       The Tribe next raises a number of arguments related to PSE's stipulation

and revised JARPA. The Tribe contends the changes to the PSE project required

a new application, the revised project was insufficient for review, and the Board

should have remanded to the City.

       Changes to a project after the local government has issued a shoreline

development permit are governed by WAC 173-27-100. The applicant must

provide the local government "detailed plans and text describing the proposed

changes." WAC 173-27-100. The local government determines if formal review is

necessary based on the nature of the proposed changes. Id. Substantive

changes, defined as changes that "materially alter the project in a manner that

relates to its conformance to the terms and conditions of the permit," require

formal review. Id. Changes that are "within the scope and intent of the original

permit" do not require formal review. WAC 173-27-100(1). Generally, proposed

changes are within the scope and intent of the original permit if they do not

increase the construction area, exceed permit requirements, or adversely impact

the environment. WAC 173-27-100(2).

       The Tribe argued below that PSE's stipulation eliminating work in the

Hylebos and the corresponding revision to PSE's permit application were

substantial changes that required a new permit application. At the hearing, the

City's experts addressed this argument. Shannon Brenner, the City's

environmental specialist, and Shirley Schultz, the City's principal planner,

                                        18
No. 77748-3-1/19

testified that projects frequently change in response to concerns by various

agencies. Schultz testified that she reviewed the changes to the PSE project and

determined that they did not require formal review. She stated that, by eliminating

work in the Hylebos and increasing mitigation, PSE reduced environmental

impact and increased environmental benefit. The Board agreed with the City that

the changes did not require formal review under WAG 173-27-100.

        The Tribe challenges this conclusion. The Tribe asserts that WAG 173-27-

100 does not apply because the revised project is not the same as the project

approved in the SSDP. The Tribe provides no authority supporting this position.7

Id. at 41 n. 19. The Board considered whether the changes to PSE's project

required formal review under WAG 173-27-100 and concluded they did not. The

Tribe provides no evidence to the contrary.8 There was no error.

        The Tribe next asserts that PSE's stipulation and revised application

deprived the Tribe of a fair hearing. To satisfy due process, a party must receive

adequate notice and an opportunity to be heard. City of Redmond v. Arroyo-

Murillo, 149 Wn.2d 607, 617, 70 P.3d 847(2003).

        The Tribe asserts that it did not receive adequate notice of the changes to

the PSE project and was thus denied the opportunity to prepare intelligently for

the hearing. The Tribe contends the revised JARPA was filed after the discovery


        7 The authority the Tribe does cite, Hayes v. Yount, 87 Wn.2d 280, 291, 552 P.2d 1038
(1976), is inapposite. In Hayes, the Board determined that a project's intended use was
prohibited. Hayes, 87 Wn.2d at 291. The Board rejected the applicant's "offer before the Board to
accept additional conditions" and vacated the permit. Id. Haves does not discuss WAC 173-27-
100 or provide any grounds for ignoring the criteria established therein.
        8 The Tribe asserts that the City never considered the changes to PSE's project. The
Tribe misconstrues the record. Brenner stated that the City had conducted "no formal review...."
3VRP (5/11/16) at 132.


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cutoff and the additional mitigation in the revised JARPA was merely

speculative.9

       PSE asserts that the stipulation eliminating working on the Hylebos was

filed some six months before the hearing, the changes reduced the scope of

work and thus were not substantive within the meaning of WAC 173-27-100, and

the Tribe fully explored changes to the project during discovery. PSE contends

the Tribe fails to show inadequate notice or prejudice from the changes.

        We agree with PSE. PSE announced that it would eliminate work on the

Hylebos in the stipulation filed six months before the hearing. As discussed

above, the change reduced the scope of the project and increased environmental

benefit. The Tribe asserts generally that the change was unfair but fails to point

to any aspect of the revised plan that constituted an unfair surprise.

        Next, the Tribe asserts that, by reviewing the revised project rather than

the project originally approved by the City, the Board usurped the City's role. The

Tribe relies on Overlake Fund v. Shoreline Hearings Board, 90 Wn. App. 746,

954 P.2d 304 (1998). In that case, the Board imposed a number of additional

conditions to a permit granted by the City. Overlake Fund, 90 Wn. App. at 752.

This court reversed, holding that substantial evidence did not support the Board's

decision to redesign the project approved by the City. Id. at 751.

       The case is inapposite. The Board did not, in this case, redesign the

project approved by the City. PSE proposed changes to the project, the City


       9 The Tribe also objects to PSE's Water Quality Monitoring and Protection Plan, which
was revised during the hearing. This plan, however, is a condition of the Army Corps' permit,
which was not at issue in this appeal.


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No. 77748-3-1/21

determined that those changes did not substantially change the project, and the

Board agreed. There was no error.

Mitigation

       The Tribe next objects to the Board's consideration of mitigation at the

Sperry Dock as part of the no net loss analysis. At the hearing, the Tribe's expert

testified that the mitigation plan did not adequately compensate for environmental

impacts. His opinion was based on an HEA analysis. The City's expert testified

that the HEA model is not applicable to shoreline permitting and has never been

accepted by the City. She stated that PSE's original mitigation plan was

adequate to meet the no net loss standard. She opined that the revised

mitigation plan more than offsets the impact of the project.

       In its findings, the Board summarized these conflicting opinions and stated

that PSE's revised mitigation plan was adequate even under the HEA analysis.

"The compensatory mitigation provided by the Revised Mitigation Plan, with the

inclusion of the mitigation activities at the Sperry Ocean Terminal, exceeds the

net results of Mr. Deshler's HEA analysis." CP at 58. The Board found "that the

record contains substantial evidence that the Revised Mitigation Plan adequately

compensates for the impacts of the Project and achieves no net loss of

ecological functions." Id. at 59.

       The Tribe contends the Board erred in considering the Sperry Dock

mitigation. The Tribe asserts the Sperry Dock mitigation is speculative because,

as of the hearing, PSE did not yet have a contract with the dock operators. Id.

       The argument is without merit. Mitigation at Sperry Dock is included in

PSE's revised plan. Compliance with the mitigation plan is a condition of the

                                        21
No. 77748-3-1/22

SSDP. The Board did not err in considering all of the measures in PSE's revised

mitigation plan.

Burden of Proof

       Next, the Tribe contends the Board improperly shifted the burden of proof.

In an application for a shoreline development permit, the applicant has the initial

burden to prove that the proposal is consistent with the local government's

criteria. RCW 90.58.140(7). The party seeking review of a local government's

decision bears the burden before the Board to show that the proposal is

inconsistent with the local shoreline master program or the SMA. Id. The Board

reviews the matter de novo. Buechel, 125 Wn.2d at 202.

       In this case, the Tribe objects to the Board's finding that "the evidence

presented did not establish the presence of sediment contamination... or

demonstrate that the measures PSE is required to implement during in-water

construction will not protect water quality and anadromous fish." CP at 51. The

Tribe asserts that its burden was to show that the City did not have adequate

information to support its finding of no net loss, not to affirmatively prove the

existence of contamination. PSE contends the Board properly reviewed the

matter de novo, determined that the permit was consistent with the TSMP and

the SMA, and thus found that the Tribe had not met its burden.

       We agree with PSE. The Tribe's experts opined that sediment testing was

necessary because contamination had been found in Commencement Bay.

PSE's experts disputed the accuracy of this evidence. They also testified that,

even if contaminates are present, BMPs will minimize any risk. The Board found



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that the Tribe failed to show that sediment testing was necessary to make a no

net loss determination. There was no error.

         In sum, we reject all of the Tribe's challenges to the Board's decision. The

Board's findings are supported by substantial evidence and the findings, in turn,

support the Board's conclusions of law. The Board did not err by relying on

excluded evidence, usurping the City's role, or applying an incorrect burden of

proof.

Attorney fees

         The Port and PSE request attorney fees on appeal pursuant to RCW

4.84.370(1). Under that statute, however, the possibility of attorney fees does not

arise until two courts have affirmed the local government's decision. Habitat

Watch v. Skagit County, 155 Wn.2d 397, 413, 120 P.3d 56(2005). The statute

thus provides the party challenging a land use decision "one opportunity to do so

free of the risk of having to pay other parties' attorney fees and costs if they are

unsuccessful before the superior court." Id. In this case, we granted PSE's

petition for direct review. PSE and the Port are not entitled to attorney fees

because two courts have not affirmed the land use decision.

         Affirmed.




WE CONCUR:




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