In re Petition Apple Hill Solar LLC

          On Appeal from Public Utility Commission Anthony Z. Roisman, Chair

          L. Brooke Dingledine of Valsangiacomo, Detora & McQuesten, P.C., Barre, for Appellants.

          Kimberly K. Hayden of Paul Frank Collins P.C., Burlington, and Thomas Melone of Allco Renewable Energy Limited, New York, New York, for Appellee.

          Thomas J. Donovan, Jr., Attorney General, and Benjamin D. Battles, Solicitor General, Montpelier, for Appellee Agency of Natural Resources.

          PRESENT: Reiber, C.J., Skoglund, Robinson, Eaton and Carroll, JJ.

          ROBINSON, J.

         ¶ 1. Neighbors of a proposed solar electric-generation facility appeal a decision of the Public Utility Commission (PUC) approving the issuance of a certificate of public good for the project. At the heart of their appeal is a challenge to the PUC's conclusions that this project-called the Apple Hill project-would not unduly interfere with the orderly development of the region and would not have an undue adverse effect on aesthetics. Both of these conclusions rest in substantial part on the PUC's conclusions that the selectboard of the Town of Bennington took the position that the Apple Hill project complied with the applicable Town Plan, and that the 2010 Town Plan did not establish a clear, written standard. Because the evidence and the PUC's findings do not support these conclusions, we reverse and remand.

         ¶ 2. The following background is undisputed. In 2015, appellee Apple Hill Solar LLC filed a petition with the PUC requesting a certificate of public good (CPG) for a proposed 2.0 megawatt, grid-connected solar-electric generation facility in Bennington.

         ¶ 3. The project site is in the southwest corner of a Rural Conservation District as defined in the Bennington Town Plan. According to the Town Plan, Rural Conservation Districts are characterized by considerable agricultural acreage, along with extensive woodlands and low-density residential development. The purpose of Rural Conservation Districts is to preserve the open space and distinctive rural character of the area while accommodating low-density residential development in a way that avoids the need for public water-supply and sewer systems. The Town Plan includes specific design standards for the Rural Conservation Districts, stating, "Development in this area cannot be sited in prominently visible locations on hillsides or ridgelines, shall utilize earth tone colors and non-reflective materials on exterior surfaces of all structures, and must minimize clearing of natural vegetation."

         ¶ 4. Appellants Libby Harris and the members of the Apple Hill Homeowners Association (which includes Harris) live near the proposed project site. Both Harris and the Homeowners Association applied for, and were granted, permissive intervention in the CPG proceeding.

         ¶ 5. The Town of Bennington also intervened in the proceedings. When it intervened in 2015, the Town argued that the project should not be granted a CPG because it would unduly interfere with the orderly development of the region and would have an undue adverse impact on aesthetics, and in particular, would "violate[] the clear, written community standards in the Town Plan . . . to protect the high scenic quality of this gateway area located in the Rural Conservation District."

         ¶ 6. In August 2017, after Apple Hill agreed to various changes to mitigate the aesthetic impact of the project, the Town selectboard changed its position, voting to "not oppose Apple Hill on the grounds that the Project fails to comply with the Town Plan in effect when the application was filed."

         ¶ 7. CPG proceedings for another proposed solar-electric generation facility, called the Chelsea Solar project, which would be located next to the Apple Hill project in the Rural Conservation District, are relevant to this appeal. In February 2016, the PUC held that the Chelsea Solar project would violate clear, written community standards in the 2010 Bennington Town Plan. In re Chelsea Solar LLC, No. 8302, 2016 WL 722444, at *39 (Vt. Pub. Serv. Bd. Feb. 16, 2016).^[1]Specifically, the PUC held that the Chelsea Solar project would violate the following three requirements in the Town Plan for development in the Rural Conservation District: only limited residential development is permitted; development may not be sited on prominently visible locations on hillsides; and development must minimize the clearing of natural vegetation.^[2] Id. at *39-40. Accordingly, it held that the Chelsea Solar project would have an undue adverse effect on aesthetics and denied the petition for a CPG for the project. Id. at *43. Chelsea Solar appealed that decision to this Court in June 2017.

         ¶ 8. In September 2017, Chelsea Solar filed a motion with the PUC for relief from the February 2016 order in the Chelsea Solar case, in support of which it attached a revised proposal for the project. The PUC denied Chelsea Solar's motion, but added that it "encourages Chelsea to file a new petition reflecting its proposed . . . project and proposes measures to achieve its prompt review." It said that

we appreciate Chelsea's efforts to revise the Chelsea Project and its desire to exercise common sense in response to the Town Selectboard's vote to support the revised Apple Hill project. To this end and to promote judicial efficiency, the Commission encourages Chelsea to withdraw its appeal with the Vermont Supreme Court and file a new petition . . . .

         Chelsea Solar accordingly withdrew its appeal and filed a new petition for a smaller project with more efficient solar panels in approximately the same location as previously proposed.

         ¶ 9. Subsequently, in this Apple Hill matter, the hearing officer issued a proposal for decision finding in pertinent part that the project would not unduly interfere with the orderly development of the region, as required under 30 V.S.A. § 248(b)(1), and would not have an undue adverse effect on aesthetics or on the scenic or natural beauty of the area, as required by 30 V.S.A. § 248(b)(5). Of particular relevance to this appeal, the hearing officer recommended that the PUC conclude that the project would not violate any clear, written community standard-a key consideration in the assessment of whether an adverse aesthetic effect is undue pursuant to § 248(b)(5). He said that neither stare decisis nor collateral estoppel precluded the PUC from deciding here-unlike in Chelsea Solar-that the Bennington Town Plan was not a clear, written community standard.

         ¶ 10. The Town withdrew from the Apple Hill proceeding between the time when the hearing officer issued his proposal for decision and when the PUC issued its decision.

         ¶ 11. Harris and the Homeowners Association submitted comments on the proposal for decision. They argued that the project would unduly interfere with the orderly development of the region, that the Town Plan contained a clear, written community standard, and that the proposed Apple Hill project would violate the Town Plan for the same reasons the previously rejected Chelsea Solar project would have violated it.

         ¶ 12. The PUC largely adopted the hearing officer's findings and conclusions and issued Apple Hill a CPG.

         ¶ 13. On appeal, Harris and the Homeowners Association (collectively "appellants") argue, based on the PUC's holding in its Chelsea Solar decision, that collateral estoppel and established precedent preclude the PUC from concluding in this case that the proposed solar project would not violate a clear, written community standard reflected in the Bennington Town Plan. They also argue that the PUC erred in holding that the Apple Hill project would not unduly interfere with orderly development or have an undue adverse effect on aesthetics, and that findings it made in support of these determinations were clearly erroneous. Apple Hill contends that appellants do not have statutory or constitutional standing to appeal the PUC's decision, and that the PUC's order was correct and should be affirmed.

         ¶ 14. We conclude that appellants have statutory and constitutional standing to appeal. We reject the arguments that collateral estoppel or established precedent prevent the PUC from reaching a different conclusion from its Chelsea Solar decision as to whether the proposed solar project violates a clear, written community standard in the 2010 Bennington Town Plan. Finally, we hold that the PUC's legal conclusions as to whether the Apple Hill project would unduly interfere with the orderly development of the region under ...