In the Matter of: Wermager Beach Utility Company.

This opinion is nonprecedential except as provided by
Minn. R. Civ. App. P. 136.01, subd. 1(c).

STATE OF MINNESOTA
IN COURT OF APPEALS
A25-1450

In the Matter of: Wermager Beach Utility Company.

Filed April 27, 2026
Affirmed
Connolly, Judge

Minnesota Pollution Control Agency
File No. 4550

Andrew D. Cook, Ohnstad Twichell, P.C., West Fargo, North Dakota (for petitioner
Wermager)

Keith Ellison, Attorney General, Philip S. Pulitzer, Assistant Attorney General, St. Paul,
Minnesota (for respondent MPCA)

Considered and decided by Reyes, Presiding Judge; Connolly, Judge; and Jesson,
Judge.
NONPRECEDENTIAL OPINION
CONNOLLY, Judge
In this certiorari appeal, relator challenges an order by respondent requiring relator
to apply for a water-discharge permit for the continued operation of its sewage system.
Relator asserts that (1) because the system was constructed and installed in accordance
with Minnesota law as it existed at the time, respondent did not have the authority to issue
the order; and (2) relator’s compliance with certain provisions of the order negates the

 Retired judge of the Minnesota Court of Appeals, serving by appointment pursuant to
Minn. Const. art. VI, § 10.
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violations alleged by respondent. Because respondent has the authority to require relator
to secure a permit for the continued operation of the sewage system, and because the issue
of relator’s compliance with the order is not properly before the court, we affirm.
FACTS
Relator Wermager Beach Utility Company owns and operates a pond -based sewer
system (the system) located on Big Cormorant Lake in Lake Park, Minnesota. The system
was constructed in late 1971 and early 1972 and has been in operation since that time. In
total, the system currently services 37 homes.
In 1991, respondent Minnesota Pollution Control Agency (MPCA) inspected the
system “to determine the physical condition of the pond system, and to evaluate the
system’s current and future capability for treating wastewater.” The MPCA ultimately
recommended minor repairs be made to the system but did not notify Wermager as to any
permit non-compliance.
In 2024, the MPCA received a phone call from a real estate agent who was listing a
house for sale in Becker County. The agent requested compliance paperwork for
Wermager’s system. The MPCA then contacted Becker County asking for confirmation
of the system’s location. Becker County provided the MPCA with design data from 1971
for waste-treatment facilities and a sanitary sewer system. The MPCA reviewed its files
and confirmed that Wermager did not have, and had never been issued, a water-discharge
permit for the system.
The MPCA then inspected the system. Following the inspection, the MPCA
requested all permits related to the construction and operation of the system, original design
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documents, number of people connected to the system, the location of where the system
discharges, and how the system and system’s components are maintained. Wermager
responded with a copy of the MPCA letter from 1991 that outlined the inspection
conducted at that time, notes on who the system serves , and routine maintenance
information.
The MPCA negotiated a draft schedule of compliance to bring Wermager into
compliance and secure a permit for the system. Wermager responded with a redlined
version of the document that contained several revisions. Ultimately, the parties were
unable to reach a negotiated settlement.
After negotiations failed, the MPCA issued Wermager the administrative order that
is the subject of this appeal. The order stated several conclusions. Relevant to this appeal,
it provides that: (1) the MPCA has authority to require National Pollutant Discharge
Elimination System (NPDES)/State Disposal System (SDS) permits pursuant to Minn.
Stat. § 115.07, subd. 1 (2024), and Minn. R. 7001.0030 (2023); (2) Wermager is required
to apply for a n NPDES/SDS permit for a wastewater treatment facility pursuant to this
authority and is prohibited from commencing construction, installation and operation
activities until the MPCA has issued a written permit for the facility ; (3) Wermager is
required to have a compliant treatment system for wastewater; (4) to date, Wermager has
not submitted a permit application for the system; and (5) Wermager has not adequately
operated or maintained the ponds to provide effective treatment to the wastewater . The
order then requires Wermager to complete a series of action items to come into compliance
with current regulations.
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Wermager seeks review by writ of certiorari.
DECISION
On appeal, Wermager argues that the MPCA erred by disregarding the fact that the
facility was properly approved when built and by interpreting Minnesota Statutes section
115.07 to require Wermager to obtain a permit for the system. Wermager also argues that
its compliance with certain items of the order negates the violations alleged by the MPCA.
The MPCA’s administrative orders are subject to judicial review under Minnesota
Statutes sections 14.63 -.69 (2024). Minn. Stat. § 115.05 , subd. 11 (2024). Under
Minnesota Statutes section 14.69 this court “ may affirm, remand, or reverse an agency
decision if the agency’s findings of fact are unsupported by substantial evidence, arbitrary
or capricious, or affected by an error of law. ” In re NorthMet Project Permit to Mine
Application, 959 N.W.2d 731, 749 (Minn. 2021).
Whether the MPCA has the authority to require a permit involves the interpretation
of Chapter 115 of the Minnesota Statutes and Chapter 7001 of the Minnesota Rules. “The
interpretation of statutes and administrative regulations presents a question of law which
we review de novo.” In re Reissuance of an NPDES/SDS Permit to United States Steel
Corp., 954 N.W.2d 572, 576 (Minn. 2021).
Wermager’s challenges to the MPCA’s order require us to understand federal and
state statutes and regulations governing the discharge of pollutants into waters of the state.
The Federal Pollution Control Act aims to “restore and maintain the . . . integrity of the
Nation’s waters” and prohibits the discharge of any pollutant into navigable waters without
a permit. 33 U.S.C. §§ 1251(a), 1311 (2024). The federal act was significantly amended
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in 1972 and is now commonly know n as the Clean Water Act ( CWA). Federal Water
Pollution Control Act Amendments of 1972, Pub. L. No. 92-500, 86 Stat. 816 (codified as
amended at 33 U.S.C. §§ 1251-1387 (2024)). The 1972 amendments established the
National Pollutant Discharge Elimination System (NPDES) permit program. Id. at 86 Stat.
880 (codified as amended at 33 U.S.C. § 1342).
The CWA authorizes states with approved permit programs to grant NPDES
permits. 33 U.S.C. §§ 1251(b), 1342(b) (20 24). Under the Minnesota Water Pollution
Control Act, the MPCA has authority to “administer and enforce all laws relating to the
pollution of any waters of the state ,” including authority to issue and enforce permits “ in
order to prevent, control or abate water pollution, or for the installation or operation of
disposal systems.” Minn. Stat. § 115.03, subd. 1(a)(1), (5) (2024). This authority includes
administration of both the NPDES and SDS permit programs. Minn. Stat. §§ 115.03, subd.
5(a) (2024), 115.07, subd. 1; Minn. R. 7001.1010 (2023). Because Minnesota’s statutory
amendments requiring water -discharge permits were adopted after the CWA’s passage,
Minnesota law did not require such permits before that time. See 1973 Minn. Laws ch.
374, §§ 7-9, at 745-749; § 12, at 750-751.
NPDES/SDS permits are “required to discharge pollutants from a point source into
any water in the state of Minnesota.” Minnesota Ctr. for Env’t Advoc. v. Comm’r of
Minnesota Pollution Control Agency, 696 N.W.2d 95, 101-02 (Minn. App. 2005). Chapter
7001 of the Minnesota Rules governs how the MPCA grants permits and issues
certifications, including NPDES and SDS permits. See Minn. R. 7001.1000-.1190 (2023).
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I. The MPCA has the authority to require Wermager to secure a permit for
the continued operation of the sewage system.

Wermager argues that the MPCA does not have the authority to require an
NPDES/SDS permit because such permits did not exist when the system was installed in
1971. Wermager further argues that the MPCA “cannot retroactively deem the
construction and installation of the [s]ystem to be a violation of [a] state law that was not
yet in effect.” In response, the MPCA argues that the operation of Wermager’s system
requires a permit and that the MPCA has statutory authority to require Wermager to secure
a permit to continue operating its system. We agree with the MPCA.
A. The MPCA’s order is not a retroactive application of the statute.
“No law shall be construed to be retroactive unless clearly and manifestly so
intended by the legislature.” Minn. Stat. § 645.21 (2024). A retroactive law is one that
takes away or impairs vested rights acquired under previously existing laws, creates a new
obligation, imposes a new duty, or attaches a new disability to a transaction in the
past. Cooper v. Watson, 187 N.W.2d 689, 693 (Minn. 1971). “ [A] right is not ‘vested’
unless it is something more than a mere expectation, based on an anticipated continuance
of present laws. It must be some right or interest in property that has become fixed or
established, and is not open to doubt or controversy.” U.S. Home Corp. v. Zimmerman
Stucco and Plaster, Inc., 749 N.W.2d 98, 101 (Minn. App. 2008).
Here, Wermager’s system was constructed and installed in late 1971 and early 1972.
At that time, the statutes and rules requiring the NPDES/SDS permits were not yet in place.
The MPCA’s order does not penalize Wermager for not having these permits at the time
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the system was constructed and installed. Instead, the order requires Wermager to apply
for and obtain the necessary permit to bring the system into compliance with current
regulations. As the order explains, Wermager is “prohibited from commencing
construction, installation and operation activities until the MPCA has issued a written
permit for the facility” because Wermager is “required to have a compliant treatment
system for wastewater to ensure that the wastewater will not continue to be a source of
pollution of the underground waters or impair the natural quality thereof.” (Emphasis
added.) Because the system was already constructed and installed, and because Wermager
has stated that it did not have plans to construct or install additions to the system, the
relevant portion of the order is that which prohibited Wermager’s continued operation until
it had obtained the necessary permit.
While Wermager may have had an expectation that it would not be required to
obtain a permit for continued operation because it was not required to do so when the
system was constructed and installed, such an expectation did not create a vested right. See
U.S. Home Corp. , 749 N.W.2d at 101. Furthermore, the transaction that occurred in the
past was the system’s construction and installation. See Cooper, 187 N.W.2d at 693.
Because the MPCA’s order does not penalize Wermager for not having a permit at the time
the system was constructed and installed, Wermager’s framing of the issue as one of
retroactivity is incorrect. Retroactivity is not implicated just because someone has been
engaged in an activity that previously did not require a pe rmit but that now requires one.
See State v. Reinke, 702 N.W.2d 308, 312 (Minn. App. 2005) (stating that “if an individual
began a course of conduct before a statute prohibiting the conduct was passed, she may be
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prosecuted for continuing the conduct after enactment of the prohibitive provision ”). As
such, the MPCA’s order is not a retroactive application of the statute.
B. The MPCA has permitting authority to regulate the system.
The Water Pollution Control Act broadly defines “disposal system” to mean “a
system for disposing of sewage, industrial waste and other wastes, and includes sewer
systems and treatment works.” Minn. Stat. § 115.01, subd. 5 (2024). Because Wermager
is operating a sewer system, the system is within the Act’s purview.
The legislature has authorized the MPCA to issue and enforce “reasonable
orders . . . in order to prevent, control or abate water pollution, or for the installation or
operation of disposal systems .” Minn. Stat. § 115.03, subd. 1(a)(5). The legislature has
also established that it is unlawful to “construct, install, or operate a disposal system, or
any part thereof, until plans and specifications for the disposal system have been submitted
to the agency . . . and a written permit for the disposal system i s granted by the agency. ”
Minn. Stat. § 115.07, subd. 1(a). 1 Finally, the Minnesota Rules provide that “ no person
required by statute or rule to obtain a permit may construct, install, modify, or operate the
facility to be permitted . . . until the agency has issued a written permit for the facility or
activity.” Minn. R. 7001.0030.

1 While Wermager argues that Minn. Stat. § 115.07, subd. 1 is inapplicable because “the
[s]ystem was constructed and installed over 50 years ago,” this interpretation ignores that
the statute also regulates the operation of a disposal system. See Minn. Stat. § 115.07,
subd. 1(a) (stating it is unlawful to “construct, install, or operate a disposal system . . .”
(Emphasis added.)
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Pursuant to this authority, the MPCA’s order, which requires Wermager to secure
an NPDES/SDS permit for the continued operation of the system, is a reasonable order
related to the operation of the system. See Minn. Stat. § 115.03, subd. 1(a)(5). As such,
the MPCA has the authority to require Wermager to secure a permit for the continued
operation of the system. Wermager admits that it is continuing to “operat[e] the same
[s]ystem that has existed for over 50 years.” Furt her, it is unlawful for Wermager to
continue operating the system without the required permit. See Minn. Stat. § 115.07, subd.
1(a); see also Minn. R. 7001.0030.2
C. Wermager’s reliance on the system’s history is misguided.
Wermager argues that the relevant Minnesota watershed district “properly
authorized the system in accordance with Minnesota law” at the time the system was
constructed and installed. Wermager further argues that the MPCA erred as the order did
not “explain how the Watershed District’s construction and installation of the [s]ystem was
unlawful,” and did not “cite or discuss Minnesota law as it existed at the time the [s]ystem
was established.” We disagree.
Because this is not an issue of retroactivity, it is irrelevant whether the system was
properly authorized in the 1970’s. And, as discussed, because the MPCA’s order does not

2 Wermager additionally argues that Minnesota Statutes section 115.07, subdivision 1
“allows a person to construct and install a disposal system without first obtaining a permit
so long as plans and specifications are submitted to the [a]gency.” However, this argument
overlooks that the portion of the statute referenced applies only to the construction and
installation of disposal systems, not to the operation of these systems. See Minn. Stat.
§ 115.07, subd. 1(b). Furthermore, the statute explicitly states such action is taken “at the
person’s own risk.” See Minn. Stat. § 115.07, subd. 1(b).

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penalize Wermager for not having the required permit at the time the system was
constructed and installed, the order did not need to address whether the system’s
construction and installation was unlawful. Instead, the relevant inquiry is whether the
MPCA has the authority to require Wermager to secure a permit for the continued operation
of the system under current law. The MPCA has the authority to do so. See Minn. Stat.
§ 115.03, subd. 1(a)(5); Minn. Stat. § 115.07, subd. 1(a); Minn. R. 7001.0030. As such,
Wermager’s reliance on the system’s history, and the laws in effect at the time the system
was constructed and installed, is misguided.
Wermager also suggests that , because it sent the MPCA “the plans and
specifications for the [s]ystem in 1971,” and because the MPCA “inspected the [s]ystem
in 1991” and did not raise concerns with permits at that time, the MPCA cannot now deem
the system in violation of Minnesota law. We disagree. The MPCA’s order does not rely
on the 1991 inspection to suggest that there were permit violations during that time.
Instead, the order addresses Wermager’s current violations. As such, the results of the
1991 inspection are largely irrelevant to the issue before the court.
Accordingly, the MPCA has the authority to require Wermager to secure a permit
for the continued operation of the sewage system.
II. The issue of Wermager’s compliance with the order is not properly before
the court.

Wermager argues that it has complied with the MPCA’s order and that , as a result,
the language in the order that requires Wermager to obtain a permit is “largely irrelevant
because the [o]rder dictates the actions Wermager must abide by and Wermager already
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fulfilled those directives.” In response, the MPCA argues that this appeal “involves an on
the record review of the [o]rder” and that the issue of Wermager’s compliance is premature
because compliance must first be decided by the MPCA, and there have not been any
MPCA administrative proceedings to enforce the order against Wermager. We agree with
the MPCA.
The record in a certiorari appeal is composed of documents submitted to the agency
or considered by the agency in reaching its decision. See Minn. R. Civ. App. P. 110.01,
115.04; see also Amdahl v. County of Fillmore, 258 N.W.2d 869, 874 (Minn. 1977) (stating
“[c]ertiorari is, by its nature, a review based solely upon the record.”) . Wermager had
completed the first item of the order —retaining a Minnesota licensed professional
engineer—prior to the order being issued, and MPCA acknowledged in the order tha t this
item had already been completed. As such, Wermager’s completion of the first item was
submitted to, and considered by, the MPCA in reaching its decision. See Minn. R. Civ.
App. P. 110.01, 115.04; see also Amdahl , 258 N.W.2d at 874. However, Wermager
acknowledged that “[s]ince the time [it] filed this appeal” it also completed item two. But,
because the issue of Wermager’s compliance with item two, or any subsequent items, was
not known to the MPCA when it issued the order, it is not part of the record on appeal. See
Gustafson v. Comm’r of Hum. Servs., 884 N.W.2d 674, 684 (Minn. App. 2016) (declining
to consider documents “created after the commissioner’s decision” and thus “not part of
the appellate record”); In re Block , 727 N.W.2d 166, 177 (Minn. App. 2007) (granting
motion to strike extrarecord documents that post -dated decision subject to certiorari
review).
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However, even assuming this information were included in the record, the issue of
Wermager’s compliance with the order would still be premature. Here, the MPCA points
out that it has not yet determined whether Wermager has complied with the order, nor have
there been any administrative proceedings in which the MPCA has attempted to enforce
the order against Wermager. Because Wermager has not exhausted the administrative
remedies within the MPCA, this issue is premature. See AAA Striping Servs. Co. v.
Minnesota Dep ’t of Transp. , 681 N.W.2d 706 , 714 (Minn. App. 2004) (stating the
“[e]xhaustion of administrative remedies requires that a party seeking judicial relief from
a decision of an administrative body must first exhaust the right to seek relief within that
body”).
Accordingly, the issue of Wermager’s compliance with the order is not properly
before the court.
Affirmed.