For a third time, Davison County on Tuesday approved a controversial drainage permit application, which has already been entangled in a year-long court battle upon prior approvals.

The permit for Millan Acres’ plan for draining parts of two sections of land near Interstate 90 between Mitchell and Mount Vernon in Prosper Township was approved 7-0 by the Davison County Drainage Commission during a three-plus-hour meeting.

Tuesday’s proceedings were unlike any other drainage or county commission meeting, with multiple attorneys involved, hydrology and geological experts testifying and a packed room at the Davison County North Offices. Auditor Susan Kiepke, at the request of the county’s attorney, had those in attendance swear under oath that their testimonies to the commission would be truthful, while a court reporter documented the proceedings.

It marks the third time that Davison County has approved a Millan Acres application for the land in the last year. The first application on the same land was approved in March 2020, but has been turned back by the First Circuit Court on procedural matters, on the basis of the first application missing key information and the county abusing its discretion by approving the permit. That decision has since been appealed to the South Dakota Supreme Court, where non-oral arguments are set to be considered in the case April 26.

When the first application was turned down in August 2020, Davison County Drainage Administrator Jeff Bathke granted administrative approval for the project. That decision was also appealed, and a second ruling voided that permit because Judge Chris Giles ruled that Davison County’s ordinance allowing an administrator to approve drainage permit is in conflict with the state’s drainage code, which requires a petition, public notice and a hearing by a public board for a permit to be approved.

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At least part of the tiling project was installed after the August administrative approval was granted. Nearby landowner Kenneth Hostler has taken the matter to court in each of the first two cases to appeal the decision.

While admitting it’s the same land in question, Drainage Commission Chairman Jay Larson said Tuesday that the county was only concerned about the current application in front of them and not what had been previously argued or litigated.

“We don’t care about that application from 2020. … Our concern is the one in front of us right now,” said Larson, in response to objections raised by Hostler attorney David Ganje, who appeared via telephone for the meeting.

Kenneth Hostler, of Mount Vernon, speaks during a Davison County Drainage Commission meeting April 20, 2021 at the Davison County North Offices in Mitchell. (Marcus Traxler / Republic)
Kenneth Hostler, of Mount Vernon, speaks during a Davison County Drainage Commission meeting April 20, 2021 at the Davison County North Offices in Mitchell. (Marcus Traxler / Republic)

In the light of already going to court twice in the matter, the Drainage Commission was much more delicate about spelling out the criteria involved and the application requirements to receive a permit. The board noted that the land would still remain rural in character, would not create unreasonable drainage and would prioritize ag production.

Ganje, the lawyer for Hostler, said that the county did not act with due diligence in interviewing Hostler and examining how the project would impact his land.

“Who has gone onto Mr. Hostler’s land? What is the capacity to receive this water? … There are issues that have not been addressed,” he said.

“The applicant does not have to meet those requirements off-site,” Larson responded.

In a letter submitted to the commission prior to Tuesday's decision, Ganje said it would be a "legal error" for the board to approve a "flawed, illegal, done in haste" application.

"The applicant for the third time wants this commission to hurry up and approve a project that was already in part constructed. The applicant apparently does not want law and justice to get in the way of your approving and recommending the application."

John Millan, of Millan Acres, looks on during a Davison County Drainage Commission meeting April 20, 2021 at the Davison County North Offices in Mitchell. (Marcus Traxler / Republic)
John Millan, of Millan Acres, looks on during a Davison County Drainage Commission meeting April 20, 2021 at the Davison County North Offices in Mitchell. (Marcus Traxler / Republic)

John Millan farms with his father, Brock, as part of the Millan Acres partnership. He was represented at the meeting by attorney Gary Leistico, who has represented the farming operation in the court filings, as well. Leistico said the suggestion that his clients have tried to skirt the law is false.

“At all times since this first came to this board, the goal has been to follow the law, the state law, the county ordinance, give you the information required and ask you to consider it,” Leistico told the board. “We have always believed, Mr. Millan has always believed, that we have followed the law. That’s all they want to do in this case. … We believe that the law fundamentally favors this application.”

Leistico questioned contractor Bryce Gillen, of Gridline Field Tile, of Mitchell, about the project. Gillen said the tiling project has no wetland impacts and is a mile away from Hostler’s property. Both Leistico and Gillen noted that the project has the grade and elevation changes to make the project work and that there’s adequate downstream capacity for the drainage.

Leistico also pointed out the report of Joel Toso, a North Dakota-based hydraulic and civil engineer, who had noted that the project will not substantially alter the course, amount or time of water flow, and would not cause any unreasonable hardship or injury to downstream landowners, including Hostler.

The tiling project eventually drains to Dry Run Creek, which runs through Hostler’s property. During the meeting, Hostler testified about Lidar images that he said convincingly shows that the land movements and the potential drainage outlets would put his land at risk. Rapid City-based engineer Stephen Bareis testified in support of Hostler during the meeting.

“You guys are clearly missing something,” Hostler said, pointing to the map. “It clearly shows that it is against South Dakota law. (The land does) not go my way. … It’s clearly pointed it out to you guys."

Following a back-and-forth with board member Chet Edinger, when Hostler asked Edinger why he wasn’t following what he was saying, Edinger said he trusts what the professional contractors at a firm like Gridline are telling him about how the water will flow.

When the commission brought up approving the project with conditions on the permit, Ganje noted that he believes his client Hostler would have been — and still might be — open to negotiating with Millan Acres about how the drainage project unfolds. Ganje said a meeting of that fashion has never happened between Millan and Hostler.

“We wouldn’t be here today,” Ganje said. “I think my client still might consider meeting with someone that will protect this land.”

The commission includes Edinger, Larson, County Commissioners Brenda Bode and Denny Kiner, along with Jerry Buchholz, Gregg Bult and Mark Klumb. All seven members were on the board a year ago, with Bult and Buchholz voting no on the permit in March 2020.