The Washington State Court of Appeals ruled in favor of the Department of Natural Resources (DNR) in a case involving Boyer Towing, Inc. The court upheld DNR's method for calculating rent for Boyer’s mooring buoy lease, which is significant for businesses relying on state-owned aquatic lands. The decision clarifies how lease areas are determined and the applicable regulations for calculating rent.
Boyer Towing, Inc. filed an appeal against the DNR regarding the interpretation of Washington Administrative Code (WAC) 332-30-122(1)(b)(ii) and the selection of the upland parcel used for rent calculation. The case, documented under docket number 60992-4-II, reached the Court of Appeals after a trial court's ruling that invalidated part of the WAC regulation.
The parties involved in the case include Boyer Towing, a company that operates a mooring buoy in Port Madison Bay, and the Washington State Department of Natural Resources, which manages state-owned aquatic lands. The dispute arose when DNR recalculated the rent Boyer owed for its lease, leading to disagreements over the interpretation of the relevant regulations and the selection of the appropriate upland parcel for rent calculations.
The legal conflict began when Boyer Towing applied for a lease to use state-owned aquatic lands for its mooring buoy, which had been in place since 1942. After a lengthy negotiation process, DNR and Boyer entered into a lease agreement in 2018. However, in 2022, DNR notified Boyer that it was recalculating the rent owed, resulting in a significant increase. Boyer contested DNR's interpretation of the regulations and the selection of the upland parcel used for the rent calculation.
The Court of Appeals, led by Chief Judge Veljacic, affirmed DNR's interpretation of WAC 332-30-122(1)(b)(ii). The court found that DNR's method of determining the lease area and calculating the rent was appropriate. The ruling stated, "Because DNR did not err in its interpretation of WAC 332-30-122(1)(b)(ii), we affirm the Board of Natural Resources’ determination of the lease area." This decision reinforces the validity of DNR's regulations and their application to lease agreements involving aquatic lands.
Furthermore, the court rejected Boyer's argument that DNR acted arbitrarily in selecting the upland parcel for rent calculations. The ruling clarified that DNR's choice of the residential parcel over the commercial parcel was justified based on the criteria outlined in the regulations. The court noted that the commercial parcel did not meet the necessary requirements to be considered as the upland parcel.
The impact of this ruling is significant for businesses that lease state-owned aquatic lands. It establishes a clear precedent for how rent calculations should be conducted and reinforces the authority of DNR in managing these leases. The decision may affect other companies operating under similar lease agreements, as it clarifies the interpretation of relevant regulations.
Moving forward, Boyer Towing has the option to appeal the ruling to the Washington Supreme Court. However, details regarding any related cases or further proceedings were not available in the court filing. This ruling underscores the importance of understanding the regulatory framework governing leases of state-owned aquatic lands and the implications for businesses relying on these resources.