A. GALLO CO. ET AL. v. GINA McCARTHY, COMMISSIONER OF CONNECTICUT DEPARTMENT OF ENVIRONMENTAL PROTECTION.

2010 Ct. Sup. 14438, 50 CLR 375
No. HHD CV 09 5032448Connecticut Superior Court Judicial District of Hartford at Hartford
July 12, 2010

[EDITOR’S NOTE: This case is unpublished as indicated by the issuing court.]

MEMORANDUM OF DECISION MOTION TO DISMISS
PECK, J.

The plaintiffs, distributors of beer and soft drinks in the state, [1] commenced this action for a declaratory judgment against the defendant, Gina McCarthy, Commissioner, State of Connecticut Department of Environmental Protection (DEP), on August 17, 2009. In the complaint, the plaintiffs allege that in a petition dated May 20, 2009, they sought a declaratory ruling from the defendant concerning the interpretation of certain provisions in General Statutes § 22a-243 et seq. (“the bottle bill”). Recent amendments to the bottle bill require distributors of beer and soft drinks in the state to establish dedicated bank accounts through which to process beverage container refund value deposits and payments. The amendments to the bottle bill also require distributors to periodically pay to the state any balances in these accounts. The plaintiffs sought a declaratory ruling from the defendant to the effect that the bottle bill allows them to lawfully withdraw funds from these dedicated accounts to pay the $0.015 handling fee for each empty beer container and the $0.02 handling fee for each empty soft drink container which they are required to pay to retailers pursuant to the requirements set forth in General Statutes § 22a-245(d).

The plaintiffs filed a petition for declaratory ruling, pursuant to General Statutes § 4-176(a), with the defendant on or about May 27, 2009. The acting commissioner of environmental protection, Amey Marrella, responded to the petition by way of a letter to the plaintiffs’ attorney dated July 13, 2009, in which she stated that the defendant considered the plaintiffs’ petition incomplete. The defendant specifically noted therein that the plaintiffs had failed to provide notice of the petition to all those having an interest in the subject matter of the petition, as required by § 22a-3a-4(a)(3) of the Regulations of Connecticut State Agencies. The letter identified the additional persons to whom the CT Page 14439 plaintiffs should provide notice before the defendant would deem the petition complete. The defendant concluded the letter by stating that the petition could not be deemed complete until the defendant received an affidavit demonstrating that the notice requirements of § 22a-3a-4(a)(3) were met.

The plaintiffs responded, notifying the defendant by letter dated August 13, 2009, that since the defendant did not take action on the petition within sixty days of its filing, the plaintiffs were authorized by General Statutes §§ 4-175 and 4-176 to file a declaratory judgment action in Superior Court, seeking the same relief previously sought in the petition to the defendant. The defendant has moved to dismiss the complaint on the grounds that the court lacks subject matter jurisdiction because the plaintiffs have failed to exhaust their administrative remedies before commencing this action.

I Connecticut’s Bottle Bill — General Statutes §§ 22a-243 et seq.
In this action for declaratory judgment, the plaintiffs seek clarification of the application of certain sections of Connecticut’s bottle bill, codified at General Statutes §§ 22a-243 et seq., as amended by Public Acts, Spec. Sess., November 24, 2008, No. 08-1 and Nos. 09-1 and 09-2 of the 2009 Public Acts. Specifically, the plaintiffs seek a declaratory judgment that the expenses lawfully allowed to be withdrawn from the special accounts established pursuant to the bottle bill include the handling fees that the statute requires the plaintiffs to pay to dealers for each beverage container returned to them. The plaintiffs identify themselves as “distributors of beer and soft drinks in the State of Connecticut.” General Statutes § 22a-243(6) provides in relevant part: “`Distributor’ means every person who engages in the sale of beverages in beverage containers to a dealer in this state including any manufacturer who engages in such sale and includes a dealer who engages in the sale of beverages in beverage containers on which no deposit has been collected prior to retail sale . . .” A “beverage container” is defined in General Statutes § 22a-243(3) as “the individual, separate, sealed glass, metal or plastic bottle, can, jar or carton containing a carbonated or noncarbonated beverage, but does not include a bottle, can, jar or carton (A) three liters or more in size if containing a noncarbonated beverage, or (B) made of high-density polyethylene.” CT Page 14440 General Statutes § 22a-243(5) provides in relevant part: “`Dealer’ means every person who engages in the sale of beverages in beverage containers to a consumer . . .” The plaintiffs may additionally be considered deposit initiators pursuant to General Statutes § 22a-243(12), which provides: “`Deposit initiator’ means the first distributor to collect the deposit on a beverage container sold to any person within this state.”

Under the bottle bill, deposit initiators, such as the plaintiffs, incorporate into the price of their beverages a five-cent refund value on each container sold to a dealer.[2] The dealers of such beverages in turn charge and collect a five-cent refund value from the consumer of the beverage. The bottle bill provides for the registration of redemption centers, [3] at which consumers of beverages subject to the five-cent deposit may redeem empty beverage containers for a five-cent refund value for each container returned. A redemption center or dealer may then return the empty beverage containers to the distributor/deposit initiator, who must reimburse the redemption center or dealer the five-cent refund value on each container. General Statutes § 22a-245(d) provides in relevant part: “In addition to the refund value of a beverage container, a distributor shall pay to any dealer or operator of a redemption center a handling fee of at least one and one-half cents for each container of beer or other malt beverage and two cents for each beverage container of mineral waters, soda water and similar carbonated soft drinks or noncarbonated beverage returned for redemption . . .”

The bottle bill, as amended by Public Acts, Spec. Sess., November 24, 2008, No. 08-1 and Public Acts 2009, Nos. 09-1 and 09-2, requires each deposit initiator to establish a special account in which “an amount equal to the refund value . . . for each beverage container sold by such deposit initiator” shall be deposited and from which “[a]ny reimbursement of the refund value for a redeemed beverage container shall be paid.” General Statutes § 22a-245a.[4] At the end of each statutorily established calendar quarter, any balance in such account shall be paid by the deposit initiator to the state. Section 22a-245a(d) provides in relevant part: “On or before April 30, 2009, each deposit initiator shall pay the balance outstanding in the special account that is attributable to the period from December 1, 2008, to March 31, 2009, inclusive, to the Commissioner of Environmental Protection for deposit in the General Fund. Thereafter the balance outstanding in the special account that is attributable to the immediately preceding calendar quarter CT Page 14441 shall be paid by the deposit initiator one month after the close of such quarter to the Commissioner of Environmental Protection for deposit in the General Fund.”

II Motion to Dismiss Standard
The defendant has filed a motion to dismiss the plaintiffs’ complaint on the grounds that the court is without subject matter jurisdiction because the plaintiffs failed to exhaust their administrative remedies before commencing this action. “Because the exhaustion of administrative remedies doctrine implicates subject matter jurisdiction, the court must decide as a threshold matter whether that doctrine requires dismissal of the plaintiff’s claim . . . The Superior Court has no jurisdiction to act where there is an adequate administrative remedy that has not been exhausted.” Ware v. State, 118 Conn.App. 65, 81, 983 A.2d 853 (2009); see also Practice Book § 10-31(a). “Subject matter jurisdiction [implicates] the authority of the court to adjudicate the type of controversy presented by the action before it . . . [A] court lacks discretion to consider the merits of a case over which it is without jurisdiction . . . The objection of want of jurisdiction may be made at any time . . . [a]nd the court or tribunal may act on its own motion, and should do so when the lack of jurisdiction is called to its attention . . . The requirement of subject matter jurisdiction cannot be waived by any party and can be raised at any stage in the proceedings.” (Internal quotation marks omitted.)Bingham v. Dept. of Public Works, 286 Conn. 698, 701, 945 A.2d 927 (2008).

III Conflict between Connecticut General Statutes 4-176 and DEP Regulations
In their memoranda of law, the plaintiffs and the defendant have engaged in an extensive argument focused on the validity of DEP regulations which allow the agency to toll the sixty-day period within which it must act on a petition for declaratory ruling, as provided in General Statutes § 4-176(e). Through General Statutes § 4-176(b), the General Assembly has directed each agency to adopt regulations that provide for “(1) the form and content of petitions for declaratory rulings, (2) the filing procedure for such CT Page 14442 petitions and (3) the procedural rights of persons with respect to the petitions.” The defendant argues it has adopted regulations pursuant to this provision which allows the agency to deem the plaintiffs’ petition incomplete and to toll the sixty-day period within which the defendant is required by General Statutes § 4-176(e) to act if the defendant determines that a petition is incomplete due to insufficient notice to parties with an interest in the subject matter.

Section 22a-3a-4(c)(3) of the Regulations of Connecticut State Agencies, under the subject heading, “Proceedings on declaratory rulings,” provides in relevant part: “Within sixty days after receipt of a petition for declaratory ruling filed in accordance with subdivisions (a)(1), (2), and (3) of [§ 22a-3a-4] . . . the Commissioner shall take action in accordance with subsection (e) of section 4-176 of the General Statutes.” (Emphasis added.)

Section 22a-3a-2(e) of the Regulations of Connecticut State Agencies provides in relevant part: “The Commissioner may reject an application or petition as insufficient if it does not meet the requirements of Section 22a-3a-4(a) . . . or does not meet the requirements of any other applicable provision of law governing the form, contents, and filing of such application or petition, or is so manifestly insufficient as to make further processing impossible . . . [A] rejection under this subsection shall stop the running of any time period which by law begins to run when the Department receives an application or petition; any such period shall begin anew when the Department receives an amended application or petition . . .”[5]

Section 22a-3a-4(a)(3) provides that a petition to DEP for a declaratory ruling “shall be accompanied by an affidavit that the petitioner has given notice of the substance of the petition, and of the opportunity to file comments and to request intervenor or party status . . . to all persons known by the petitioner to have an interest in the subject matter of the petition.”

As articulated by the defendant in its letter to the plaintiffs dated July 13, 2009, the defendant found that the plaintiffs had not provided the necessary notice called for by § 22a-3a-4(a)(3). Accordingly, the defendant made a determination that the petition was incomplete and that the running of the sixty-day period to act would stop until such time that the plaintiffs submitted an amended petition, at which point a new sixty-day period would commence. The defendant argues that an agency’s regulations are presumed valid and CT Page 14443 have the force of law unless they are inconsistent with the authorizing statute.

In their opposition to the motion to dismiss, the plaintiffs argue that any regulation allowing the agency to toll the sixty-day period within which it is statutorily required to act under § 4-176(e) is inconsistent with the enabling statute. Where a regulation and statute conflict, the plaintiffs continue, the statute must prevail. The plaintiffs contend that the provision within § 22a-3a-2(e) that is at issue, which allows DEP to make a determination that a petition is incomplete and to toll the running of the sixty-day period to act until such time that the plaintiffs submit an amended petition, is invalid, that DEP failed to act within sixty days on the plaintiffs’ petition as required by § 4-176(e), and that, therefore, the plaintiffs are entitled to bring this action for declaratory judgment pursuant to § 4-175(a).

The plaintiffs further contend, inter alia, that the court has subject matter jurisdiction in the present action because after the plaintiffs submitted to the defendant a petition for a declaratory ruling, pursuant to General Statutes § 4-176(a), [6] the defendant failed to take action in the form of one of the five specified actions enumerated in § 4-176(e) within sixty days after the receipt of the petition by the defendant. Section 4-176(e) provides: “Within sixty days after receipt of a petition for a declaratory ruling, an agency in writing shall: (1) Issue a ruling declaring the validity of a regulation or the applicability of the provision of the general statutes, the regulation, or the final decision in question to the specified circumstances, (2) order the matter set for specified proceedings, (3) agree to issue a declaratory ruling by a specified date, (4) decide not to issue a declaratory ruling and initiate regulation-making proceedings, under section 4-168, on the subject, or (5) decide not to issue a declaratory ruling, stating the reasons for its action.”

The plaintiffs also contend that the defendant’s failure to act on the petition allows the plaintiffs to commence this action pursuant to General Statutes § 4-175(a). Section 4-175(a) provides in relevant part: “If a provision of the general statutes . . . or its threatened application, interferes with or impairs, or threatens to interfere with or impair, the legal rights or privileges of the plaintiff and if an agency (1) does not take an action required by subdivision (1), (2) or (3) of subsection (e) of section 4-176, within sixty days of the filing of a petition for CT Page 14444 a declaratory ruling, (2) decides not to issue a declaratory ruling under subdivision (4) or (5) of subsection (e) of said section 4-176, or (3) is deemed to have decided not to issue a declaratory ruling under subsection (i) of said section 4-176, the petitioner may seek in the Superior Court a declaratory judgment as to . . . the applicability of the provision of the general statutes . . . to specified circumstances . . .”

The defendant contends that “[a]dministrative rules and regulations are given the force and effect of law . . . [The courts] therefore construe agency regulations in accordance with accepted rules of statutory construction.” (Citation omitted; internal quotation marks omitted.)Teresa T. v. Ragaglia, 272 Conn. 734, 751, 865 A.2d 428 (2005). “[I]t is well established that an administrative agency’s regulations are presumed valid and, unless they are shown to be inconsistent with the authorizing statute, they have the force and effect of a statute . . . This presumption is further underscored by the Uniform Administrative Procedure Act, General Statutes § 4-166 et seq., which provides for legislative oversight through the legislative regulation review committee prior to approval of the regulations. General Statutes § 4-170.” (Internal quotations omitted.) Giglio v. American Economy Ins. Co., 278 Conn. 794, 806-07, 900 A.2d 27 (2006).

“[If] a regulation has been in existence for a substantial period of time and the legislature has not sought to override the regulation, this fact, although not determinative, provides persuasive evidence of the continued validity of the regulation.” (Internal quotation marks omitted.) State v. Marsh, 265 Conn. 697, 708, 830 A.2d 212 (2003). “The fact that [a] regulation has been approved by the standing legislative regulation review committee, although not dispositive of the issue . . . is an important consideration in [the court’s] determination of whether the . . . regulation comports with the legislative intent . . .” (Internal quotation marks omitted.) Vitti v. Allstate Ins. Co., 245 Conn. 169, 183, 713 A.2d 1269 (1998).

The defendant further argues that although subsection (e) of § 4-176 explicitly states that an agency shall take one of five enumerated actions within sixty days after receipt of a petition for a declaratory ruling, subsection (b) of § 4-176 authorizes each agency to adopt regulations “that provide for the (1) form and content of petitions for declaratory rulings, (2) the filing procedure for such petitions and (3) the procedural rights of CT Page 14445 persons with respect to the petitions.” The DEP has used the statutory authority given to the agency under § 4-176(b), the defendant continues, to adopt regulations that give the defendant the authority to deem a petition for declaratory ruling incomplete or insufficient if certain notice requirements are not met and to stop the running of the sixty-day period until such time that a complete petition is filed.

The focus of the plaintiffs’ opposition to the motion to dismiss is to challenge the series of DEP regulations which ostensibly authorize the agency to make a determination that a petition is incomplete and allow for the tolling of the sixty-day period as inconsistent with the enabling statute. Specifically, the plaintiffs claim that the regulations, in effect, allow the agency to avoid its statutory duty to take one of the prescribed actions under § 4-176(e) within sixty days after receiving a petition for declaratory ruling. They maintain that the regulations promulgated by the defendant are not in harmony with § 4-176(e). The defendant counters that Section 22a-3a-4(c)(3) provides that the agency will act on a petition in accordance with § 4-176(e) only when a petition complies with the form, content and filing procedures provided in subdivisions (a)(1), (2) and (3) of § 22a-3a-4, regulations which are adopted pursuant to the authority granted to DEP by § 4-176(b). Section 22a-3a-2(e) allows the defendant to reject petitions that are deemed incomplete and to stop the running of the sixty-day period within which the agency must act on a petition for declaratory ruling until an amended petition is submitted, at which point the agency will act and a new sixty-day period will commence. Finally, the defendant argues that § 22a-3a-4(a)(3) provides the notice requirements that must be given by a petitioner to parties known to the plaintiffs to have an interest in the subject matter of the petition, which, in this case, is the basis for the defendant’s decision to deem the plaintiffs’ petition incomplete.

“[C]ompelling principles of statutory construction . . . require [courts] to construe a statute in a manner that will not thwart its intended purpose or lead to absurd results . . . [Courts] must avoid a construction that fails to attain a sensible result that bears directly on the purpose the legislature sought to achieve.” (Internal quotation marks omitted.) Office of Consumer Counsel v. Dept. of Public Utility Control, 246 Conn. 18, 42, 716 A.2d 78 (1998). The defendant essentially argues that despite the explicit statutory language requiring an agency to take one of the specified actions under subsection (e) CT Page 14446 of § 4-176 within sixty days after receiving a petition, the agency may adopt regulations that would allow the agency to toll that sixty-day period within which it must act. The court does not find the defendant’s argument persuasive.

The plaintiffs contend that at least one Supreme Court opinion supports their view that an agency must act within the statutorily mandated time period which begins when an application or petition is received, and that any regulation which would allow DEP to avoid taking action within sixty days, as prescribed by § 4-176(e), is invalid. They point to Viking Construction Co. v. Planning Commission, 181 Conn. 243, 435 A.2d 29 (1980), for support. I Viking, the trial court granted judgment in a mandamus action to the plaintiff developer. Id., 248. The plaintiff sought to compel the defendant commission to issue a certificate of approval for a subdivision application on the ground that the defendant failed to act on the application within the sixty-five-day statutory period after the application was received.[7] Id., 245-46. The defendant commission disapproved the application on September 12, ninety-one days after the application’s date of receipt on June 13. Id., 246. The trial court determined, and the Supreme Court affirmed, that due to the defendant commission’s failure to act on the application within sixty-five days of receipt, as statutorily required, “the subdivision plan had been approved by operation of law long before the commission took its action on September 12, and . . . the plaintiff had a clear legal right to the issuance of a certificate to that effect . . .” Id., 247-48.

The Viking court noted that Sections “8-26 and 8-26d establish a definitive timetable during which planning and zoning commissions must act.” Id., 246. The court further noted that “[t]he defendant’s contention that the phrase `officially received’ gives the commission discretion to determine when it wishes to receive a subdivision application is without merit. The receipt of an application form by an administrative body involves the performance of a ministerial act . . . It does not require the exercise of discretion. The phrase `officially received’ seeks to differentiate between those situations where the planning commission holds regularly scheduled meetings and those when it does not. In the former case, the filed application is treated for the purpose of activating the running time clock as of the date of the regular meeting next following the date of application whereas in the latter case the date of filing activates the trigger mechanism. In both cases the activation is prescribed by statute.” (Citation omitted.). CT Page 1444 Id., 247.

The present case does not involve a land use matter but instead a petition to an agency for declaratory ruling. A finding that DEP failed to act within a statutorily prescribed period would not lead to an automatic approval as such a finding did in Viking but would instead only allow the plaintiffs to seek a declaratory judgment as to the applicability of the amendments to the Bottle Bill in Superior Court. As in Viking, however, the controlling statute, here § 4-176, gives the defendant no discretion as to when an application is received or when the agency must act on an application or petition after it is received. DEP regulations that delay the commencement of the sixty-day period within which the agency is required to take action on the plaintiffs’ petition directly conflict with § 4-176(e). As the court articulated i Viking in a land use context, the “activation” of the time period within which the DEP was required to act on the plaintiffs’ petition for declaratory ruling was prescribed by statute, and, in the present case, the time period within which DEP must act is similarly prescribed by the UAPA. Failure by DEP to act within sixty days of receiving the petition allows the plaintiffs to invoke the statutory remedy set forth in § 4-175(a), which provides the plaintiffs the remedy of a declaratory judgment in Superior Court.

While § 4-176(b) does allow an agency to adopt regulations providing for the form and content, filing procedures and procedural rights concerning petitions for declaratory ruling, that subsection explicitly states that such regulations shall be adopted “in accordance with the provisions” of the UAPA, which includes § 4-176(e), the statutory section requiring an agency to act within sixty days of receiving a petition for declaratory ruling. Section 4-176(e) provides no exception or extension to this sixty-day period. Nonetheless, the defendant relies on § 4-176(b), arguing that the agency’s authority under this statutory section allowed DEP to promulgate the regulation, § 22a-3a-4(c)(3) of the Regulations of Connecticut State Agencies, which states that the running of the sixty-day period would only commence upon receipt “of a petition for declaratory ruling filed in accordance with subdivisions (a)(1), (2) and (3) of [§ 22a-3a-4].” (Emphasis added.) Since the defendant determined that the plaintiffs failed to comply with § 22a-3a-4(a)(3), which provides that a petition to DEP for a declaratory ruling “shall be accompanied by an affidavit that the petitioner has given notice of the substance of the petition, and of the opportunity to file comments and to request CT Page 14448 intervenor or party status . . . to all persons known by the petitioner to have an interest in the subject matter of the petition,” the defendant argues that the sixty-day period never commenced. The defendant further contends that the plaintiffs were required to submit a completed petition which met the regulatory notice requirements of this section and that the court has no subject matter jurisdiction over this action for declaratory judgment since the plaintiffs failed to fully exhaust their administrative remedy of pursuing a declaratory ruling.

In support of its contention that the DEP regulations allowing the agency to effectively toll the statutory period within which it was required to act on a petition for declaratory ruling are valid, the defendant points to Commission on Hospitals Health Care v. Stamford Hospital, 208 Conn. 663, 546 A.2d 257 (1988). However Stamford Hospital offers little support for the defendant’s arguments that the DEP regulations in question in the present case do not conflict with the statutory requirement in § 4-176 to act within sixty days of receipt of a petition for declaratory ruling.

In Stamford Hospital, the defendant hospital appealed from a trial court judgment that enjoined the defendant from instituting open heart surgery and coronary angioplasty programs without prior approval from the plaintiff commission. Id., 664. The defendant argued, inter alia, that the trial court erred in holding that § 19a-160-53[8] of the Regulations of Connecticut State Agencies was consistent with General Statutes § 19a-154.[9] Id. On July 23, 1986, the plaintiff received the defendant’s application, found it deficient and requested additional information in a deficiency letter dated August 6, 1986, a request to which the defendant hospital never responded. Id.
On December 8, 1986, legal counsel for the hospital indicated that he had advised the defendant hospital that it was authorized to proceed with its new programs because the plaintiff commission had not denied or modified the hospital’s application within ninety days of submission. Id., 665. The plaintiff filed a petition for enforcement of the requirements of § 19a-154, seeking to enjoin the hospital from instituting its new programs without the commission’s approval. The trial court entered a permanent order prohibiting the hospital from instituting the new programs and the Appellate Court affirmed. Id., 666-67, 675.

In Stamford Hospital, the court rejected the defendant hospital’s contention that § 19a-160-53, which defined an CT Page 14449 application as “all the required components and any special components set forth in these regulations,” conflicted with § 19a-154. Id., 667. The court noted that § 19a-154 specified “a number of factors the commission must consider in determining whether to approve a request for a new function or service . . . The enumeration of these factors, therefore, suggests that the legislature was concerned with the information to be submitted with a request and did not contemplate that the commission would act upon a bare `request for permission.'” (Internal quotation marks omitted.) Id., 668-69. The court concluded that the “commission’s regulations are a reasonable construction of the statutory phrase `request for permission’ because they further the legislative intent of having the commission consider a multitude of factors before making its determinations. Under § 19a-160-53, the commission must send a deficiency letter to the applicant notifying it that its request is not properly before the commission. The ninety-day review period does not begin to run, therefore, because the application, lacking adequate accompanying information, has not enabled the commission to consider the statutory factors set forth in” § 19a-154. Id., 669-70. Accordingly, the court affirmed the trial court judgment and held that the regulation did not conflict with § 19a-154.

In the present case, the defendant commissioner relies upon § 4-176(b) as the authority for the adoption of the regulations at issue that would allow the defendant to effectively toll the sixty-day period within which it must act on the petition because § 4-176(b) authorizes the DEP to adopt regulations concerning form, content and filing procedure for such petitions, much in the way the plaintiff commission in Stamford Hospital
successfully relied upon the provisions in § 19a-154 in arguing that its regulations, which effectively tolled the ninety-day period to act, were not invalid. The comparison of the present case t Stamford Hospital, however, does not persuade this court that the DEP regulations that allow the defendant to toll the sixty-day period are not in conflict with § 4-176(e).

First, § 19a-154 explicitly states that a fifteen-day extension to the ninety-day period within which the commission must act is available to an applicant if the commission has requested additional information after the applicant has submitted its application. The defendant in the present case has identified no provision and this court has found none in the UAPA that provides for any extension of the time period within which an agency must act on a petition for declaratory ruling. The statutory language in § 19a-154 creates the CT Page 14450 implication that an application filed under that section is deemed incomplete by the commission if there has been a request for additional information and may be acted upon outside the rigid ninety-day period to act, whereas an application for which the commission does not request additional information must be acted upon within ninety days or is automatically deemed approved. No such reference to additional information or incompleteness of a petition is found in § 4-176, which simply states that an agency must take one of the actions specified in said section within sixty days of receipt of a petition for declaratory ruling.

Additionally, § 19a-154 explicitly identifies several factors that the commission should consider in reviewing an application for a certificate of need submitted by a health care facility seeking to add any additional function or service. The statute states that the commission should ascertain the availability of such medical services at other health care facilities within the same area, the need for such service within such area and “any other factors which the commission deems relevant to a determination of whether the facility or institution is justified in introducing such additional functions or services.” This language, coupled with the above referenced statutory provision in § 19a-154 authorizing the commission to extend the ninety-day period if additional information was requested from an applicant, provides statutory guidance which suggests that the legislature intended that the commission could establish rules and regulations delaying the commencement of the ninety-day period if an application did not meet the definition of “application” provided in § 19a-160-53 due to deficiencies identified by the commission.

While § 4-176(b) enables an agency to adopt regulations concerning the form, content and filing procedures of petitions for declaratory ruling, no provision in the UAPA supports the defendant’s contention that DEP could adopt regulations that circumvent the provision in § 4-176(e) requiring action on such petitions within sixty days. Any regulatory provision that allows the defendant to toll the sixty-day period to act is without statutory support, and in fact, conflicts directly with the statutory scheme.

Furthermore, unlike Stamford Hospital, where the information provided in an application contained “voluminous financial, medical and scientific information that ordinarily accompanies a certificate of need application,” and the commission determined that the application was incomplete, in the present case, the defendant did not object to any deficiency in the actual form or content of the CT Page 14451 petition, but instead claimed that the plaintiffs failed to meet the necessary notice requirements. The defendant argued that the plaintiffs needed to provide notice to several additional persons and identified some of these persons in the July 13, 2009, letter. In the context of certificates of need, the legislature explicitly extended authority to the commission to weigh “any other factors which the commission deems relevant” in determining whether to approve an application and to request additional information from an applicant, which could extend the period to act. In the context of petitions for declaratory rulings under the UAPA, however, the legislature has provided no statutory authority, to the DEP or any other agency, to extend or toll the sixty-day period to act on declaratory rulings due to a perceived notice deficiency by a petitioner. Despite the defendant’s contention that it is entitled to toll the sixty-day period to act because the plaintiffs’ petition failed to meet the necessary notice requirements provided in § 22a-3a-4(a)(3), the plaintiffs did submit with their petition an affidavit stating that they had given notice of the substance of the petition and of the opportunity to file comments and to request intervenor or party status to all persons known by the plaintiffs to have an interest in the subject matter of the petition. Despite the defendant’s claim that the plaintiff failed to provide notice to all persons known to have an interest in the subject matter of the petition, DEP actually provided a list of potentially interested persons to the plaintiffs and the plaintiffs relied upon that list in providing notice. Though not the determinative issue in this matter, given that the plaintiffs’ affidavit states that notice was provided to all persons known by the plaintiffs to have an interest in the subject matter of the petition, the plaintiffs’ affidavit appears to technically satisfy the requirements of the regulation.

The court recognizes that in determining the validity of an agency regulation, a regulation is presumed valid and the fact that a regulation has been in existence for a significant period of time and that the legislature has not sought to override the regulation is persuasive evidence of its continued validity. However, the court is also mindful that, “[t]he power of an administrative agency to prescribe rules and regulations under a statute is not the power to make law, but only the power to adopt regulations to carry into effect the will of the legislature as expressed by the statute . . . The [agency] . . . has a delegated discretion, which, to be properly exercised, where it has binding consequences, must obey the statutory commands of the UAPA.” (Citations omitted.) Salmon Brook Convalescent Home, Inc. v. Commission on Hospitals Health Care, 177 Conn. 356, 363, 417 A.2d 358 (1979). CT Page 14452 “An administrative agency, in making rules and regulations, must act within its statutory authority . . .” Page v. Welfare Commissioner, 170 Conn. 258, 262, 365 A.2d 1118 (1976). “[A] person claiming the invalidity of a regulation has the burden of proving that it is inconsistent with or beyond the legislative grant.” (Citation omitted; internal quotation marks omitted.)Giglio v. American Economy Ins. Co., supra, 278 Conn. 806-07. The plaintiffs herein have met this burden.

Despite the fact that § 4-176(e) explicitly states that an agency must take one of the specified actions “[w]ithin sixty days after receipt of a petition for a declaratory ruling,” the DEP promulgated regulations that allows it to avoid meeting this sixty-day requirement. The UAPA contains no provision authorizing an agency to extend the time within which it must act on a petition for declaratory ruling. Nevertheless, the DEP has adopted regulations which redefine the time limits prescribed by § 4-176(e) by engrafting a tolling provision onto the statute to be applied within the sole discretion of the agency which undermines the streamlined procedure contemplated by the statutory scheme.

To the extent that these regulations increased, delayed or tolled the time period within which DEP must take action, pursuant to § 4-176(e), beyond the permissible sixty days after receipt of a petition for declaratory ruling, the regulations are invalid. These regulations exceeded DEP’s statutory authority and directly conflict with the UAPA. While § 4-176(b) allows an agency to adopt regulations that “provide for . . . the form and content of petitions for declaratory rulings . . . [and] the filing procedure for such petitions . . .” the same statutory section also provides that such regulations shall be “in accordance with the provisions” of the UAPA, which includes § 4-176(e). As illustrated i Viking and Stamford Hospital, an agency cannot extend or prolong the statutory period within which it must act after receipt of an application or petition unless there exists clear statutory authority authorizing such delay. In the present case, no such authority exists.

CONCLUSION
Because the defendant failed to take action on the plaintiffs’ petition for declaratory ruling within sixty days of receiving the petition, as required by § 4-176(e), the plaintiffs are entitled to seek a declaratory judgment in Superior Court pursuant to § 4-175(a). Accordingly, the defendant’s motion to dismiss for CT Page 14453 failure to exhaust administrative remedies is hereby denied. The court has subject matter jurisdiction over this action for declaratory judgment, brought pursuant to General Statutes § 4-175(a).

[1] The plaintiffs are: A. Gallo Co.; Allan S. Goodman, Inc., d/b/a Rogo Distributors; Dichello Distributors, Inc.; Dawn Co, Inc.; FF Distributors, Inc.; Franklin Distributors, Inc.; GG Beverage Distributors, Inc.; Hartford Distributors, Inc.; Levine Distributing Co., Inc.; Northeast Beverage Corp.; Pepsi Cola Newburgh Bottling Co., Inc., d/b/a Pepsi Cola Bristol; Star Distributors, Inc.
[2] General Statutes § 22a-244(a) provides: “(1) Every beverage container containing a carbonated beverage sold or offered for sale in this state, except for any such beverage containers sold or offered for sale for consumption on an interstate passenger carrier, shall have a refund value. Such refund value shall not be less than five cents and shall be a uniform amount throughout the distribution process in this state. (2) Every beverage container containing a noncarbonated beverage sold or offered for sale in this state shall have a refund value, except for beverage containers containing a noncarbonated beverage that are (A) sold or offered for sale for consumption on an interstate passenger carrier, or (B) that comprise any dealer’s existing inventory as of March 31, 2009. Such refund value shall not be less than five cents and shall be a uniform amount throughout the distribution process in this state.”
[3] General Statutes § 22a-243(9) provides in relevant part “`Redemption center’ means any facility established to redeem empty beverage containers from consumers or to collect and sort empty beverage containers from dealers and to prepare such containers for redemption by the appropriate distributors . . .”
[4] General Statutes § 22a-245a provides in relevant part: “(a) Each deposit initiator shall open a special interest-bearing account at a Connecticut branch of a financial institution, as defined in section 45a-557a, to the credit of the deposit initiator. Each deposit initiator shall deposit in such account an amount equal to the refund value established pursuant to subsection (a) of section 22a-244, for each beverage container sold by such deposit initiator. Such deposit shall be made not more than one month after the date such beverage container is sold, provided for any beverage container sold during the period CT Page 14454 from December 1, 2008, to December 31, 2008, inclusive, such deposit shall be made not later than January 5, 2009. All interest, dividends and returns earned on the special account shall be paid directly into such account. Such moneys shall be kept separate and apart from all other moneys in the possession of the deposit initiator.

(b) Any reimbursement of the refund value for a redeemed beverage container shall be paid from the deposit initiator’s special account. Upon the Commissioner of Environmental Protection’s adoption of written policies and procedures establishing an accounting system under section 22a-245, any such reimbursement shall be paid in the manner prescribed in such policies and procedures until the adoption of final regulations under said section 22a-245. Upon the adoption of such regulations, any such reimbursement shall be paid in accordance with such regulations.

(c) Each deposit initiator shall submit a report on March 15, 2009, for the period from December 1, 2008, to February 28, 2009, inclusive. Each deposit initiator shall submit a report on July 31, 2009, for the period from March 1, 2009, to June 30, 2009, inclusive, and thereafter shall submit a quarterly report for the immediately preceding calendar quarter one month after the close of such quarter. Each such report shall be submitted to the Commissioner of Environmental Protection, on a form prescribed by the commissioner and with such information the commissioner deems necessary, including, but not limited to: (1) The balance in the special account at the beginning of the quarter for which the report is prepared; (2) a list of all deposits credited to such account during such quarter, including all refund values paid to the deposit initiator and all interest, dividends or returns received on the account; (3) a list of all withdrawals from such account during such quarter, all service charges and overdraft charges on the account and all payments made pursuant to subsection (d) of this section; and (4) the balance in the account at the close of the quarter for which the report is prepared . . .”

[5] In its written response letter to the plaintiffs, dated July 13, 2009, the defendant does not invoke § 22a-3a-2(e) and does not state that it is “rejecting” the plaintiffs’ petition. The defendant only states that it considered “the petition to be incomplete, an issue that can be resolved through providing additional notice . . .” The defendant only CT Page 14455 invokes § 22a-3a-2(e) in its memoranda in support of its motion to dismiss.
[6] General Statutes § 4-176(a) provides: “Any person may petition an agency, or an agency may on its own motion initiate a proceeding, for a declaratory ruling as to the validity of any regulation, o the applicability to specified circumstances of a provision of the general statutes, a regulation, or a final decision on a matter within the jurisdiction of the agency.” (Emphasis added.)
[7] General Statutes (Rev. to 1977) § 8-26 provided in relevant part: “The commission shall approve, modify and approve, or disapprove any subdivision . . . application or maps and plans submitted therewith . . . within sixty-five days after the public hearing thereon or, if no public hearing is held, within sixty-five days after the submission . . . The failure of the commission to act thereon shall be considered as an approval, and a certificate to that effect shall be issued by the commission on demand . . .”

General Statutes (Rev. to 1977) § 8-26d provided in relevant part: “In all matters wherein a formal application . . . must be submitted to a planning commission, the date of receipt of such application . . . shall be the date of the next regularly scheduled meeting of such commission, immediately following the date of application . . . at which such application . . . is officially received by such commission, or thirty-five days from the date of application . . . whichever is sooner.”

[8] At the time this action was commenced, § 19a-160-53 of the Regulations of Connecticut State Agencies provided in relevant part: “The date of filing of any application . . . under [§ 19a-154] shall be the date that the application is received by the commission . . . An application shall consist of all the required components and any special components set forth in these regulations . . . All deficiencies in any filed petition or application to the commission [on hospitals and health care] shall be brought to the attention of the petitioner or applicant in a written communication mailed to the petitioner or applicant not later than ten (10) business days after receipt of the petition or application at the commission’s office and the application or petition shall be no longer before the commission.”
[9] Section 19a-154 was later transferred to General Statutes § 19a-638. Section 19-154 (Rev. to 1986) provided in CT Page 14456 relevant part that any “health care facility or institution . . . which intends to introduce any additional function or service into its program of health care . . . shall . . . submit to the commission [on hospitals and health care] a request for permission to undertake such function or service . . . The commission shall make such review of the proposal as it deems necessary . . . in the case of the introduction of an additional function or service, ascertaining the availability of such service or function at other . . . facilities or institutions within the area to be served, the need for such service or function within such area and any other factors which the commission deems relevant to a determination of whether the facility or institution is justified in introducing such additional functions or services . . . The commission shall grant, modify or deny such request within ninety days of the receipt thereof, except that upon request of the applicant, the ninety-day review period may be extended for an additional fifteen days if the commission . . . has requested additional information . . . Failure of the commission to act on such request within such ninety-day period shall be deemed approval thereof . . .” (Emphasis added.)

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