Robert A. Goldberg
Raymond Keener, III
King, Betts & Allen
Charleston, West Virginia
Attorneys for the Appellants
Robert R. Rodecker
Drexel M. Vealey
McDonald & Rodecker Legal Division
Charleston, West Virginia Public Service Commission
Attorney for the Appellee Charleston, West Virginia
Southern Jackson County Attorney for the Appellee
Public Service District Public Service Commission
JUSTICE MILLER delivered the Opinion of the Court.
1. "'"[A]n order of the public service commission based
upon its finding of facts will not be disturbed unless such finding
is contrary to the evidence, or is without evidence to support it,
or is arbitrary, or results from a misapplication of legal
principles." United Fuel Gas Company v. The Public Service
Commission, 143 W. Va. 33 [99 S.E.2d 1 (1957)].' Syllabus Point 5,
in part, Boggs v. Public Service Comm'n, 154 W. Va. 146, 174 S.E.2d
331 (1970)." Syllabus Point 1, Broadmoor/Timberline Apartments v.
Public Service Commission, 180 W. Va. 387, 376 S.E.2d 593 (1988).
2. Although construction of a new facility proposed by
a utility will often require the taking of private property through
eminent domain, in the absence of express statutory language, the
Public Service Commission has no duty to review and decide issues
that are inherent in the eminent domain proceeding.
3. Under W. Va. Code, 16-13A-25 (1986), a public
service district must first obtain a certificate of public
convenience and necessity before it can acquire or construct public
4. Where the Public Service Commission is authorized to
issue a certificate of public convenience and necessity, in
addition to any specific statutory guidelines, the Commission
should consider the general public convenience to be served and the
public necessity for it, having in mind the adequacy of any
competing similar facilities.
James Sexton and Barbara Sexton, husband and wife, appeal
a final order of the Public Service Commission of West Virginia
(PSC), dated February 14, 1992. In this order, the PSC
conditionally approved the application of the Southern Jackson
County Public Service District (the District) for a certificate of
public convenience and necessity to construct and operate a sewage
treatment facility on property currently owned by the Sextons. On
appeal, the Sextons assign three errors: (1) the location of the
sewage lagoons violates regulations promulgated by the West
Virginia Department of Health and Human Services (the Department)
and constitutes a nuisance; (2) the PSC erred in finding the
project economically feasible; and (3) the District failed to
establish that public convenience and necessity exists. We find no
error; accordingly, we affirm the final order of the PSC.
On June 4, 1991, the District submitted an application to the PSC pursuant to W. Va. Code, 24-2-11 (1983),See footnote 1 and W. Va. Code, 16-13A-25 (1986),See footnote 2 for a certificate of public convenience and necessity to construct and operate a waste water treatment plant and collection system. The proposed waste water treatment facility would consist of two aerated sewage lagoons, a septic reception station, and a disinfection and post-aeration system, and would serve 194 customers in and around Fairplain, Jackson County. The sewage lagoons would be located on approximately six acres of the Sextons' 242-acre farm and would be approximately 430 feet from their home.
On July 8, 1991, having learned of the proposed location
of the lagoons, the Sextons filed a protest to the District's
application and a motion to intervene. The PSC granted the Sextons
intervenor status, and on October 10, and 11, 1991, an evidentiary
hearing was conducted at which all parties were represented by
Following the hearing, the administrative law judge (ALJ)
issued a decision recommending that the District's application be
denied. The ALJ based her recommendations upon the following
"1. The Applicant has failed to establish that public convenience and necessity exists with regard to the project as proposed. . . .
"2. The plant site, as proposed,
has not received final approval from the
appropriate state agencies and, therefore, is
not in the public's best interest.
"3. The project is not economically
feasible inasmuch as the property needed for
the project has not been obtained and the
final project costs cannot be determined."
On January 17, 1992, the District filed exceptions to the
ALJ's recommendation with the PSC. In an order entered February
14, 1992, the PSC rejected the ALJ's recommendations and approved
the District's certificate application, conditioned upon the land
acquisition costs coming within the District's estimate. The
The Sextons' primary argument is that the proposed location for the sewage lagoons violates the buffer-zone requirements promulgated by the Department. These provisions establish distances that must be maintained between sewage treatment plants and occupied dwellings. As a guiding principle, the rules mandate that the site should "be as far as practicable from any present built-up[.]" 64 W. Va. C.S.R. § 47-4-1.2. The regulations further provide that "[a]erated lagoons shall be located a minimum of 300 feet from the nearest occupied structure." 64 W. Va. C.S.R. § 47-4-11.4.2.See footnote 3 The Sextons concede, as they must, that the proposed lagoons comply with the minimum mandates of 64 W. Va. C.S.R. § 47-4-11.4.2; however, they argue that this regulation merely identifies a starting point for assessing the proper location.
In support of their argument, the Sextons direct our
attention to the testimony of Harry Pitts, a professional engineer
retained by them. Mr. Pitts testified that the minimum buffer-zone
requirement was far from adequate because of the type of system
proposed by the District and because of the topography of the
surrounding area. Mr. Pitts concluded that "[t]he nature of the
collection system . . . makes the potential for serious nuisance
and hazardous conditions much greater, perhaps a certainty as
compared to a more conventional plant receiving and treating fresh
The District counters by highlighting the numerous
weaknesses in Mr. Pitts' testimony. Although Mr. Pitts has an
extensive background in sanitary sewer design, he admitted during
cross-examination that he was not familiar with the type of system
proposed and that the first time he reviewed the plans for the
proposed plant was on the day of the hearing. Moreover, Mr. Pitts
confessed that he had failed to contact officials at the
Page/Kincaid Public Service District in Fayette County where the
same treatment design was already in use. Indeed, Mr. Pitts
conceded that he had made no effort to determine whether the
Page/Kincaid facility experienced odor problems.
The District offered the expert testimony of Paul Ghosh,
the District's design engineer. Mr. Ghosh testified that the
collection system proposed was in compliance with all federal and
state standards and that the system's design had been modified to
avoid the odor concerns about which Mr. Pitts had speculated. Mr.
Ghosh concluded that the proposed system and site location were the
most cost-effective way to deal with the waste treatment problem in
Fred Hypes, an engineering supervisor with the West
Virginia Division of Natural Resources (DNR), also testified on
behalf of the District. Mr. Hypes stated that the aerated lagoons
being proposed were "a common treatment technology that has been
used throughout the State of West Virginia." Mr. Hypes further
explained that the design of the proposed facility was identical to
the Page/Kincaid Public Service District and he characterized it as
"very, very conservative." Finally, Mr. Hypes warned that DNR
strongly endorsed the project as proposed and that the failure of
the District to secure a certificate of public convenience and
necessity would likely cause DNR to revoke grant funds.
In Broadmoor/Timberline Apartments v. Public Service
Commission, 180 W. Va. 387, 376 S.E.2d 593 (1988), we reviewed an
order of the PSC in a case involving the jurisdiction of the PSC,
and, in Syllabus Point 1, we stated our general standard for
"'"[A]n order of the public service commission based upon its finding of facts will not be disturbed unless such finding is contrary to the evidence, or is without evidence to support it, or is arbitrary, or results from a misapplication of legal principles." United Fuel Gas Company v. The Public Service Commission, 143 W. Va. 33 [99 S.E.2d 1 (1957)].' Syllabus Point 5, in part, Boggs v. Public Service Comm'n, 154 W. Va. 146, 174 S.E.2d 331 (1970)."
Applying this standard, we conclude that the PSC did not
err in finding that the proposed site satisfied the buffer-zone
requirements. All the parties acknowledge that the distance of the
proposed lagoons from the Sextons' home is approximately 430 feet,
which exceeds the minimum buffer-zone requirement of 300 feet. In
deciding whether, in this case, the distance should be greater than
the minimum requirement, the PSC relied on ample evidence in the
record to support the District's claim that the proposed location
is both cost-effective and environmentally sound; thus, we are
compelled to defer to the expertise and judgment of the PSC.
Accordingly, we find the PSC's ruling that the project complies
with the buffer-zone requirement is supported by substantial
evidence, and we find no error.
As a corollary, the Sextons vigorously contend that the proposed location of the lagoons constitutes a nuisance under our common law. Whether the construction of the sewage lagoons would constitute a nuisance does not defeat the PSC's jurisdiction to issue a certificate of public convenience and necessity under W. Va. Code, 24-2-11. Certainly, the PSC may assess, as it did in this case, environmental considerations with regard to the proposed facility; however, as we will point out in Part III, infra, the chief inquiry is the need of the public for the project. In this case, the District had been advised by DNR officials that it was not in compliance with the federal Clean Water Act because it did not have a secondary waste water treatment facility. This noncompliance is persuasive evidence that the proposed plant is for the public convenience and necessity.
The PSC is empowered by statuteSee footnote 4 to issue a certificate
of public convenience and necessity. Although construction of a
new facility proposed by a utility will often require the taking of
private property through eminent domain, in the absence of express
statutory language, the PSC has no duty to review and decide issues
that are inherent in the eminent domain proceeding.See footnote 5 Even if the
facility creates a nuisance to the Sextons, this harm is simply an
element of just compensation in an eminent domain proceeding.
Courts have recognized in appropriate instances that a public
facility's creation of a nuisance can be an injury to property and
compensable in an eminent domain proceeding.See footnote 6
Although this subject has not received a great deal of
judicial attention, there are ample cases that hold that a public
service commission, in the absence of specific statutory authority,
is not empowered to determine whether particular property interests
acquired or to be acquired by a utility are compensable in an
eminent domain action. Likewise, the PSC may not render any type
of monetary judgment for such property interests, as affixing the
value of the property taken is the function of the trier of fact in
an eminent domain proceeding. See, e.g., Old State Util. Corp. v.
Greenbrier Dev. Corp., 181 Ind. App. 697, 393 N.E.2d 785 (1979);
Central La. Elec. Co. v. Pointe Coupee Elec. Membership Corp., 182
So. 2d 752 (La. App.), writ refused, 249 La. 119, 185 So. 2d 529
(1966); WEJAC Utils., Inc. v. Davenport, 269 So. 2d 339 (Miss.
1972); Davis-Moore Indus. Park v. Missouri Pac. R.R. Co., 210 Neb.
652, 316 N.W.2d 593 (1982).
Moreover, where a governmental entity lawfully exercises
its right to take private property for public use, the affected
landowner's remedy is the right to obtain compensation for the
property taken. See Ruckelshaus v. Monsanto Co., 467 U.S. 986, 104
S. Ct. 2862, 81 L. Ed. 2d 815 (1984); Hurley v. Kincaid, 285 U.S.
95, 52 S. Ct. 267, 76 L. Ed. 637 (1932); Glosemeyer v. Missouri-Kansas-Texas R.R., 879 F.2d 316 (8th Cir. 1989), cert. denied, 494
U.S. 1003, 110 S. Ct. 1295, 108 L. Ed. 2d 473 (1990); United States
v. City of Pittsburgh, 467 F. Supp. 1080 (N.D. Cal. 1979), aff'd,
661 F.2d 783 (9th Cir. 1981); Department of Transp. v. Bonnett, 257
Ga. 189, 358 S.E.2d 245 (1987); Stewart v. City of Marshfield, 431
S.W.2d 819 (Mo. App. 1968); Midgett v. North Carolina State Highway
Comm'n, 260 N.C. 241, 132 S.E.2d 599 (1963). As the United States
Supreme Court explained in Ruckelshaus v. Monsanto Co., 467 U.S. at
1016, 104 S. Ct. at 2880, 81 L. Ed. 2d at 841:
"Equitable relief is not available to enjoin an alleged taking of private property for a public use, duly authorized by law, when a suit for compensation can be brought against the sovereign subsequent to the taking. Larson v. Domestic & Foreign Commerce Corp., 337 U.S. 682, 697, n.18, [69 S. Ct. 1457, 1465, n. 18, 93 L. Ed. 1628, 1640 n. 18] (1949)." (Citations omitted; footnote omitted).See footnote 7
Thus, we conclude that the Sextons' claim for damage to
their property from the construction of the sewage lagoons is not
an issue for the PSC to decide, but rather is a matter that should
be addressed in the eminent domain proceeding.See footnote 8
The Sextons next argue that the PSC erred in issuing the certificate of public convenience and necessity because the project is not economically feasible. In support of this contention, the Sextons argue that the $50,000 set aside by the District to acquire the Sextons' six acres will not adequately compensate them. The only evidence in the record that this amount is inadequate is the testimony of Mr. Sexton. He estimated the total value of his 242-acre farm at between $550,000 and $650,000, and speculated that the sewage lagoons would devalue the property between 25 and 75 percent. Because the amount allocated to acquire the property is less than the value assigned by the property owners, they argue the project is economically unfeasible.
Several considerations render this argument unsound.
First, the PSC's order reserved final approval of the project
pending the determination in the eminent domain proceeding of the
amount for acquisition of the Sexton acreage. This reservation
recognized that, if the cost of acquisition was substantially above
the District's estimate, a further study of the project's economic
feasibility and potential alternative sites would be made.See footnote 9 We
find this approach eminently reasonable.
Furthermore, under W. Va. Code, 16-13A-25, a public
service district must first obtain a certificate of public
convenience and necessity before it can "acquire or construct
public service property."See footnote 10 Thus, a public service district cannot
exercise its right of eminent domain until it has received a
certificate of public convenience and necessity. As a consequence,
in computing the cost of the project, the public service district
will necessarily rely on estimates of the cost of the land
acquisition. A certificate need not be withheld until the actual
cost of acquisition is determined. If the PSC finds the estimates
reasonable, it may issue the certificate.
To hold otherwise would ignore the statute's plain
language that the certificate be secured before property
acquisition. Moreover, to require the District to first acquire
the property could result in the unnecessary expenditure of funds,
inasmuch as the PSC might refuse to issue the certificate.
Finally, we disagree with the Sextons' argument that the
only testimony of the property's value came from the landowner, Mr.
Sexton; thus, the PSC had to accept his valuation, and, because it
was substantially above the $50,000 estimate, the project should
have been rejected. First, as we have earlier pointed out, the PSC
does not adjudicate the value of property taken. More importantly,
contrary to the Sextons' assertions, there is other evidence in the
record estimating the value of their property.
For example, Paul Stover, the chairman for the District,
testified that the Sextons' property had been appraised and that a
report had been submitted to the District. The report estimated
the fair market value of the entire estate at approximately
$500,000 and also valued the property taken. Based on the
appraised fair market value, the District offered the Sextons
$4,700 for the six acres of land taken and $45,200 for "damages" to
the residue of the property.
Even though we have held that a landowner is competent to
give an estimate of the value of his property in an eminent domain
proceeding, we have never held that this valuation is conclusive.
See, e.g., West Virginia Dep't of Highways v. Sickles, 161 W. Va.
409, 242 S.E.2d 567 (1978), overruled on other grounds, West
Virginia Dep't of Highways v. Brumfield, 170 W. Va. 677, 295 S.E.2d
917 (1982); Tennessee Gas Transmission Co. v. Fox, 134 W. Va. 106,
58 S.E.2d 584 (1950). Rather, the PSC may rely on an appraisal
report concerning the estimated value of the property to be taken
and does not have to rely solely on the landowner's estimated
For the foregoing reasons, we reject the Sextons'
argument that the project was not economically feasible because the
District had not yet acquired the Sexton property.
The Sextons further argue that the District failed to present sufficient evidence that public convenience and necessity exist. We disagree. In issuing certificates, the PSC's primary concern is to "serve the interests of the public." Lumberport-Shinnston Gas Co. v. Public Serv. Comm'n, 165 W. Va. 762, 765, 271 S.E.2d 438, 441 (1980), quoting Boggs v. Public Serv. Comm'n, 154 W. Va. 146, 154, 174 S.E.2d 331, 336 (1970). See also West Virginia-Citizen Action Group v. Public Serv. Comm'n, 175 W. Va. 39, 330 S.E.2d 849 (1985).
The term "public convenience and necessity" is not
defined in W. Va. Code, 24-1-1, et seq. The same term is used in
our "Motor Carriers and Properties for Hire Act" found in W. Va.
Code, 24A-2-5(a) (1980). In Stowers & Sons Trucking Co. v. Public
Service Commission, 182 W. Va. 374, 378, 387 S.E.2d 841, 844
(1989), we construed W. Va. Code, 24A-2-5(a), and quoted this
language from Monongahela West Penn Public Service Co. v. State
Road Commission, 104 W. Va. 183, 192, 139 S.E. 744, 748 (1927):
"'Courts and Commissions construing statutes similar to ours have uniformly held that the necessity and convenience referred to is that of the public generally as distinguished from that of a number of individuals or a community, and that the inadequacy of the existing service and the convenience or necessity of the proposed service must both affirmatively appear from the evidence.'" (Footnote omitted).
See also State ex rel. Twehous Excavating Co. v. Public Serv.
Comm'n, 617 S.W.2d 104 (Mo. App. 1981); Warminister Township Mun.
Auth. v. Pennsylvania Pub. Util. Comm'n, 185 Pa. Super. 431, 138
A.2d 240 (1958).
Thus, we conclude, as a general proposition, that where
the PSC is authorized to issue a certificate of public convenience
and necessity, in addition to any specific statutory guidelines,
the PSC should consider the general public convenience to be served
and the public necessity for it, having in mind the adequacy of any
competing similar facilities.
In this case, the District has met its burden. On June
30, 1987, a DNR official wrote the chairman of the District to
advise him that the District is "responsible for compliance with
the federal Clean Water Act by July 1, 1988. In order to comply
with the requirements of the Act, your [District] must have
secondary waste water treatment facilities or better in place,
operating under a valid WV/NPDES Permit and meeting required
effluent limitations by the deadline[.]" Moreover, at the hearings
on October 10 and 11, the majority of the public who testified
agreed that there was a need for a sewage treatment facility in the
county. Mr. Sexton himself testified that he felt such a project
was necessary.See footnote 11 Today, Jackson County still does not have a
single sewage treatment facility. Finally, the District has
secured adequate funding for construction of the project and, thus,
has demonstrated its ability to provide the necessary services.
Accordingly, we affirm the final order of the PSC, dated February 14, 1992, granting the District a certificate for public convenience and necessity.
Footnote: 1W. Va. Code, 24-2-11(a), provides, in pertinent part:
"No public utility, person or
corporation shall begin the construction of
any plant, equipment, property or facility
for furnishing to the public any of the
services enumerated in section one [§ 24-2-1], article two of this chapter, nor apply
for, nor obtain any franchise, license or
permit from any municipality or other
governmental agency, except ordinary
extensions of existing systems in the usual
course of business, unless and until it shall
obtain from the public service commission a
certificate of public convenience and
necessity requiring such construction[.]"
Footnote: 2W. Va. Code, 16-13A-25, provides, in relevant part:
"Unless the properties to be constructed or
acquired represent ordinary extensions or
repairs of existing systems in the usual
course of business, a public service district
must first obtain a certificate of public
convenience and necessity from the public
service commission in accordance with the
provisions of chapter twenty-four [§ 24-1-1
et seq.] of this code, when a public service
district is seeking to acquire or construct
public service property." (Emphasis added).
Footnote: 3A table provided with the buffer-zone requirements lists the minimum distance for aerated lagoons as 100 feet, as opposed to 300 feet. William Herald, an employee of the Department, testified at the hearing that he assisted in promulgating the interpretative rules pertaining to the buffer-zone requirements for sewage treatment facilities and that 100 feet was the actual minimum distance required. Mr. Herald testified that the distance of 300 feet appearing in 64 W. Va. C.S.R. § 47-4-11.4.2 was a printing error. For purposes of this opinion, we must assume that the buffer-zone requirement is 300 feet.
Footnote: 4For the statutory requirements for issuing a certificate of public convenience and necessity, see notes 1 and 2, supra.
Footnote: 5In State ex rel. City of Wheeling v. Renick, 145 W. Va. 640, 652, 116 S.E.2d 763, 770 (1960), we said that the PSC could order a utility to extend services: "'[A] public service commission may, where its action is not unlawful, arbitrary, or capricious, order an extension of service for the inhabitants of such territory.'" Quoting 43 Am. Jur. Public Utilities & Services § 199. (Citations omitted). Obviously, such an order could necessitate the utility's exercise of its power of eminent domain, but this exercise would not be under the PSC's jurisdiction.
Footnote: 6See, e.g., United States v. Causby, 328 U.S. 256, 66 S. Ct. 1062, 90 L. Ed. 1206 (1946); Portsmouth Harbor Land & Motel Co. v. United States, 260 U.S. 327, 43 S. Ct. 135, 67 L. Ed. 287 (1922); Sewer Improvement Dist. No. 1 v. Fiscus, 128 Ark. 250, 193 S.W. 52 (1917); Green Acres Land & Cattle Co. v. State, 766 S.W.2d 649 (Mo. App. 1988); Department of Transp. v. Bonnett, 257 Or. 189, 358 S.E.2d 245 (1987).
Footnote: 7A property owner may bring a writ of mandamus against a governmental entity to compel it to bring an eminent domain proceeding. See, e.g., State ex rel. McCormick v. Miller, 171 W. Va. 42, 297 S.E.2d 448 (1982); State ex rel. Rhodes v. West Virginia Dep't of Highways, 156 W. Va. 735, 187 S.E.2d 218 (1972). We have also approved the use of an injunction where the entity having the right to condemnation has failed to exercise it before first obtaining the right to do so. See Allen v. City of Charleston, 90 W. Va. 131, 111 S.E. 485 (1922); Lovett v. West Virginia Cent. Gas Co., 65 W. Va. 739, 65 S.E. 196 (1909).
Footnote: 8We are informed by the parties that an eminent domain action has been filed, but has been continued pending the outcome of this appeal.
Footnote: 9An alternative site was proposed by the Sextons, but was rejected by the District because it would increase the project cost by $522,000 and would result in an average increase in the user fee of $15.00 per month. The increased costs were due to the need for an access road, pumping station, bridge, creek relocation, and additional electricity costs.
Footnote: 10For the text of W. Va. Code, 16-3A-25, see note 2, supra.
Footnote: 11Indeed, in a letter dated October 7, 1985, to the editor of the Jackson Herald in Ripley, West Virginia, Mr. Sexton stated, in pertinent part:
"My family and I moved to Jackson County
nearly fourteen years ago to enjoy the
outdoors and a cleaner environment. My kids
use [sic] to play in the creeks and swim in
the ponds. When hunting, I not uncommonly
would drink from a clear fast flowing brook.
I wouldn't dream of allowing my family to do
these things today.
"I am writing to express my enthusiastic
support for the sewer system as proposed by
the Southern Jackson County Public Service