The Iowa Court of Appeals held that a storage lagoon, which contained “industrial wastewater” sold to a farmer for use as fertilizer, was not an agricultural use under Iowa Code § 335.2 because its primary purpose was to store byproducts of an industrial process and because the “wastewater” in question is not considered a fertilizer by the Iowa Department of Agriculture. Since the lagoon was deemed not to be an agricultural use, the court further held that it did not enjoy “right-to-farm” protections and was not exempt from county zoning regulations.
In 2003, plaintiff, pharmaceutical company Sioux Pharm, Inc., constructed an 859,000-gallon earthen wastewater storage lagoon to hold “filtered food-grade bovine protein solution,” a “high-strength organic” byproduct of its manufacturing process. The lagoon was located in an unincorporated area zoned for agricultural use. The wastewater in the lagoon contained nutrients which were believed to have some benefit to crops, but Sioux Pharm lacked proper approval from the Iowa Department of Agriculture to sell the wastewater for use as fertilizer. However, Dr. Allan Kramer, a farmer, president of Sioux Pharm and a plaintiff in this case, purchased the wastewater from Sioux Pharm and used it to fertilize his crops.
At the time of construction, plaintiff did not have approval from the county or the state Department of Natural Resources to build the lagoon. Sioux Pharm also failed to obtain the necessary special exception use permit required for treatment facilities located in agricultural districts. In 2004, the state approved the storage lagoon as built and issued Sioux Pharm a permit for its operation, but stated that the wastewater stored in the lagoon was “truly waste.”
In early 2008, the Sioux County Zoning Administrator cited Sioux Pharm for violating zoning ordinances – specifically, for operating a lagoon in an agricultural zone without a special use permit—after receiving complaints about odor emanating from the lagoon. After discussions between Sioux Pharm and the Sioux County Planning and Zoning Commission, in August 2008 Sioux Pharm was granted a temporary special exception use permit to operate the lagoon, subject to conditions including fencing installation, odor reduction, and compliance with Department of Natural Resources regulations, expiring on June 1, 2009. At its meeting in May 2009, the Planning and Zoning Commission determined that Sioux Pharm had failed to adhere to the permit conditions and declined to extend the permit past its expiration. Despite the permit expiration, Sioux Pharm continued to operate the lagoon, and filed suit against the Board, arguing that the lagoon was an agricultural use and thus exempt from zoning regulations.
Sioux Pharm argued that its lagoon was an agricultural use because its contents were being used as fertilizer and further that right to farm provisions included Iowa law expressly preempted county zoning ordinances on agricultural land and structures. However, the court held that because Sioux Pharm built the lagoon and because Sioux Pharm was “not in the business of storing or selling fertilizers . . . or of raising crops . . .” its use of the lagoon was primarily to support its manufacturing process and served “as a substitute for a wastewater treatment facility,” not part of an agricultural function. That the wastewater stored in the lagoon was eventually used as fertilizer was not dispositive, since the court noted that the wastewater “has never been approved as a fertilizer” and since its use as fertilizer was “merely incidental to the real purpose for the storage lagoon” – containment of industrial waste.
The court distinguished this case from DeCoster v. Franklin County, 497 N.W.2d 849 (Iowa 1971), which involved a lagoon built to store hog wastes generated on a farm. While a lagoon used for “storage and disposal of hog waste” was “clearly a part of the agricultural function,” the lagoon in Sioux Pharm was used primarily for storing byproducts of industrial manufacturing processes, and was thus not an agricultural use. Therefore, the court held in favor of the Board and determined that Sioux Pharm’s lagoon was not exempt from county zoning.
Kramer v. Board of Adjustment for Sioux County, 795 N.W.2d 86 (Iowa Court of Appeals, 11/24/10)
The opinion can be accessed at: http://www.iowacourts.gov/court_of_appeals/Recent_Opinions/20101124/0-636.pdf
For more information about this case, see the Midwest Planning BLUZ blog at: http://blogs.extension.iastate.edu/planningBLUZ?s=kramer
