1020-00004 · Greenfield Agricultural Partners · Analysis

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PRIVILEGED AND CONFIDENTIAL — ATTORNEY WORK PRODUCT

MEMORANDUM

TO: Rafael Dominguez, Lead Associate, Real Estate, Calderwood & Harkness LLP

FROM: Cynthia Ho, Working Associate, Real Estate, Calderwood & Harkness LLP

DATE: July 20, 2023

RE: Public Comment Response Strategy — PSD Air Permit Application (IDNR) and NPDES Permit Application (IDNR) for Muscatine Expansion Facility — Greenfield Agricultural Partners LLC

C&H Matter No.: 1020-00004

I. Purpose and Executive Summary

The purpose of this memorandum is to analyze all public comments received during the two public notice and comment periods conducted by the Iowa Department of Natural Resources ("IDNR") for (i) the Prevention of Significant Deterioration ("PSD") air construction permit application and (ii) the National Pollutant Discharge Elimination System ("NPDES") individual permit application, each submitted on behalf of our client, Greenfield Agricultural Partners LLC ("GAP"), for the Muscatine Expansion Facility ("MEF") located at 14800 Highway 61 North, Muscatine, Iowa 52761. This memorandum provides a comment-by-comment analysis and recommends response approaches for each comment in coordination with IDNR staff as they prepare their respective responsiveness summaries for both permit proceedings.

A total of six (6) public comments were received across the two proceedings. These are summarized as follows:

PSD Air Permit (public notice period: June 12 – July 12, 2023): Four (4) comments were received:

• Two comments from neighboring landowners raising concerns about particulate matter and odor, respectively;

• One comment from Heartland Environmental Alliance ("HEA"), an Iowa unincorporated non-profit advocacy group, challenging the adequacy of the Best Available Control Technology ("BACT") analysis for NOx and PM₂.₅ and requesting a formal public hearing on the PSD draft permit; and

• One comment from the Muscatine County Soil & Water Conservation District ("SWCD") requesting clarification on stormwater management controls (which, though submitted during the air permit comment period, substantively relates to the NPDES permit proceeding).

NPDES Permit (public notice period: June 19 – July 19, 2023): Two (2) comments were received:

• One comment from HEA requesting a public hearing on the NPDES draft permit and questioning the adequacy of the antidegradation review; and

• One comment from the Prairie Farmers Coalition ("PFC"), the Iowa Chapter of the National Farmers Union, raising concerns about impacts on Sweetland Creek water quality and downstream agricultural irrigation uses.

Overall Assessment. After careful analysis, it is my assessment that the comments received are manageable. None of the comments raise issues that would require material modifications to either draft permit, and, considered individually and collectively, the comments do not support the need for a formal public hearing on either permit. The substantive concerns raised by commenters can be fully and adequately addressed through written responses prepared by GAP, through Calderwood & Harkness, for submission to IDNR for incorporation into the IDNR responsiveness summaries. The IDNR Air Quality Bureau's responsiveness summary is anticipated to be issued on or about August 3, 2023, and the IDNR Water Quality Bureau's responsiveness summary is anticipated to be issued on or about August 10, 2023.

Permit Issuance Timeline and Financing Implications. It is important to note that the permit issuance timeline is sensitive from a transactional perspective. The Briarwood Capital Partners LP credit agreement (Reference No. BCP-AG-2023-0092, dated February 15, 2023), which provides the project's principal debt financing, requires that all material environmental permits for the MEF be obtained within 210 calendar days from March 9, 2023 — i.e., by October 5, 2023 — as a condition precedent to the $89 million second drawdown tranche. Any significant delay in the issuance of either the PSD air permit or the NPDES permit would jeopardize this critical financing milestone. As discussed in Section V below, the current projected issuance dates for both permits (PSD: August 22, 2023; NPDES: September 1, 2023, effective October 1, 2023) provide a reasonable but not unlimited buffer to the October 5, 2023 deadline. This underscores the importance of managing the public comment response process efficiently and avoiding any triggering event, such as a contested public hearing, that could introduce delay.

Coordination. The factual and technical information underlying this memorandum has been obtained from Derek Yun, GAP's Director of Environmental, Health, and Safety ("EHS"), as well as from Pinnacle Environmental Consultants Inc. ("Pinnacle Environmental"), specifically Dr. Leonard Fisk, P.E. (for air quality matters) and Karen Ott (for water quality matters), who served as the primary technical consultants on the PSD and NPDES applications, respectively.

II. Background on the Permitting Proceedings

This section summarizes the key parameters of each permitting proceeding and the characteristics of the MEF to provide context for the comment analysis that follows.

A. PSD Air Permit Application

GAP filed its PSD air construction permit application with the IDNR Air Quality Bureau on April 28, 2023. The application was assigned to Jonathan Kreske, P.E., as the lead permit reviewer within the Bureau. IDNR issued a completeness determination on May 19, 2023, confirming that the application contained all information necessary for substantive review. Following IDNR's preparation of a draft permit, the public notice period commenced on June 12, 2023 and concluded on July 12, 2023, spanning the required 30-day period.

Facility Description. The MEF is a greenfield industrial facility proposed for construction on a 147-acre site in Muscatine County, Iowa (Parcel ID 0735-19-200-004). The facility will conduct two primary operations: (1) soybean processing, with a crush capacity of 3,200 tons per day, and (2) specialty fertilizer blending, consisting of a 450 tons-per-day granular blending line. The site is currently undeveloped agricultural land and was acquired by GAP from the Reinholt Family Trust on January 20, 2023 for $3,820,000.

PSD Applicability. PSD review is triggered for the MEF because the facility's potential to emit ("PTE") for nitrogen oxides ("NOx") is 312 tons per year ("tpy"), which exceeds the 250 tpy major-source threshold applicable to source categories not listed among the 28 named source categories in 40 C.F.R. § 52.21(b)(1)(i). Additionally, the facility's greenhouse gas ("GHG") emissions, calculated at 148,600 tpy of carbon dioxide equivalent ("CO₂e"), trigger PSD review for GHG as an "anyway" source — i.e., a source that is already subject to PSD review for at least one conventional pollutant (here, NOx) and exceeds the 75,000 tpy CO₂e significance threshold for GHG. Accordingly, a BACT analysis is required for NOx, particulate matter less than 10 micrometers in diameter ("PM₁₀"), particulate matter less than 2.5 micrometers in diameter ("PM₂.₅"), and CO₂e.

Attainment Status. Muscatine County is designated attainment for all criteria pollutants under the Clean Air Act, including PM₁₀, PM₂.₅, ozone, NOx, SO₂, CO, and lead. As a result, the PSD program, rather than the nonattainment New Source Review ("NSR") program, applies.

Air Dispersion Modeling. Air quality dispersion modeling was conducted using AERMOD Version 23.1, the current EPA-approved regulatory model. The modeling utilized a five-year meteorological dataset (2018–2022) from Muscatine Municipal Airport (station identifier KMUT), which is the nearest representative National Weather Service station to the project site. The receptor grid was configured at 50-meter spacing extending outward to a distance of 5 kilometers from the proposed emission sources. The modeling analysis evaluated all relevant averaging periods and pollutants for comparison to applicable National Ambient Air Quality Standards ("NAAQS") and PSD increments.

Key modeling results include a maximum modeled 24-hour PM₁₀ impact of 38.2 µg/m³ at the nearest receptor location, which, when combined with the monitored background concentration of 72 µg/m³, yields a total impact of 110.2 µg/m³. This total is well below the 24-hour PM₁₀ NAAQS of 150 µg/m³, leaving a compliance margin of approximately 39.8 µg/m³ (26.5 percent of the standard). Modeled PM₂.₅ impacts are similarly below the applicable NAAQS and PSD increments, as detailed in Attachment B.

Nearest Receptor. The nearest sensitive receptor is a residential property located approximately 0.42 miles (2,218 feet) east-northeast of the proposed stack location for EU-01, the primary process heater. This receptor location is a key reference point for several of the public comments discussed below.

B. NPDES Permit Application

GAP filed its NPDES individual permit application with the IDNR Water Quality Bureau on May 5, 2023. The application was assigned to Amy Lindstrom as the lead permit reviewer. IDNR issued a completeness determination on May 30, 2023. Following IDNR's preparation of a draft permit, the public notice period commenced on June 19, 2023 and concluded on July 19, 2023, spanning the required 30-day period.

Discharge Configuration. The MEF will have two discharge outfalls:

• Outfall 001: Treated process wastewater, including soybean wash water and cooling tower blowdown, with a design flow of 0.38 million gallons per day ("MGD"). This outfall will discharge on a continuous basis during facility operations.

• Outfall 002: Industrial stormwater from paved areas, the fertilizer loadout pad, and the truck wash facility. This outfall will discharge on an intermittent, storm event-driven basis.

Receiving Water. Both outfalls will discharge to Sweetland Creek, a tributary of the Mississippi River. Sweetland Creek is classified under Iowa's water quality standards as Class A1 (Primary Contact Recreation) and Class B(WW) (Warm Water Aquatic Life). These use classifications establish the applicable water quality criteria against which the proposed discharge is evaluated.

Treatment System. The MEF's wastewater treatment system for Outfall 001 consists of a multi-stage treatment train designed to achieve effluent quality consistent with applicable Iowa water quality standards. The treatment system includes the following sequential components: (1) an equalization basin for flow and load balancing; (2) a dissolved air flotation ("DAF") unit for removal of suspended solids and fats, oils, and grease; (3) a three-cell aerated lagoon system with a total surface area of 4.2 acres and a design hydraulic retention time of 18 days, providing secondary biological treatment; and (4) ultraviolet ("UV") disinfection for pathogen reduction prior to discharge.

Proposed Effluent Limits (Outfall 001). The draft permit proposes the following effluent limitations for Outfall 001:

Antidegradation Review. IDNR conducted an antidegradation review in accordance with Iowa Administrative Code 567—Chapter 61 and the Iowa antidegradation implementation procedures. The review concluded that the proposed discharge warrants a Tier 1 analysis (existing uses maintained). IDNR issued a preliminary determination that no Tier 2 alternatives analysis is required. The Tier 1 determination reflects that the proposed effluent limits are designed to maintain, and will not impair, the existing and designated uses of Sweetland Creek, including its Class A1 and Class B(WW) classifications.

Stormwater Pollution Prevention Plan. For Outfall 002, Pinnacle Environmental (Karen Ott) prepared a Stormwater Pollution Prevention Plan ("SWPPP") in accordance with IDNR and EPA requirements. The SWPPP details the structural and non-structural best management practices ("BMPs") that will be employed to manage stormwater discharges from paved areas, the fertilizer loadout pad, and the truck wash facility. Outfall 002 will be subject to benchmark monitoring requirements under the NPDES permit.

C. Local Approvals Already in Place

It bears noting that the principal local land use approval for the MEF has already been obtained. Conditional Use Permit No. MC-2022-041 was approved on November 15, 2022 by the Muscatine County Board of Supervisors, confirming the site's zoning as Agricultural-Industrial ("AI") and authorizing the proposed soybean processing and fertilizer blending operations. The conditional use permit proceeding included its own public notice and comment process, which concluded without significant opposition. The site itself was acquired from the Reinholt Family Trust on January 20, 2023 for a purchase price of $3,820,000 (147 acres). These local approvals are separate from and do not bear directly on the state environmental permitting proceedings addressed in this memorandum, but they confirm that the project has navigated its local regulatory requirements without material controversy.

III. Summary and Analysis of Public Comments — PSD Air Permit

This section provides a detailed summary and analysis of each of the four public comments received during the PSD air permit public notice period (June 12 – July 12, 2023), together with recommended response approaches. Full copies of all comments are compiled in Attachment A.

A. Comment 1: Neighboring Landowner — Particulate Matter Concerns

Commenter. This comment was submitted by an individual identified as a neighboring landowner whose residence is located east of the MEF site. Based on the description provided in the comment and the receptor analysis in the permit application, this commenter's residence is likely the nearest receptor identified in the application, situated approximately 0.42 miles (2,218 feet) east-northeast of the proposed stack location for EU-01.

Substance of Comment. The commenter expresses concern about particulate matter emissions — colloquially characterized as "dust" — from several aspects of the MEF's operations, including grain handling, fertilizer loadout activities, and truck traffic on access roads and within the facility. The commenter questions whether these particulate emissions will adversely affect air quality at nearby residences and whether the emissions will cause health impacts or nuisance conditions, particularly during periods of facility start-up and maximum production. The commenter references personal experience with dust from existing agricultural operations in the area and expresses apprehension that the MEF will significantly worsen these conditions.

Analysis. This comment raises a common and understandable concern for residents near industrial facilities. However, the technical record assembled in support of the PSD application provides a comprehensive demonstration that particulate matter emissions from the MEF will comply with all applicable air quality standards at the nearest receptor and at all off-site locations.

As noted above, the commenter's residence is likely the nearest receptor, located 0.42 miles (2,218 feet) east-northeast of the proposed stack location. The AERMOD dispersion modeling analysis demonstrates that the maximum modeled 24-hour PM₁₀ impact at this receptor location is 38.2 µg/m³. When added to the monitored background concentration of 72 µg/m³, the total concentration is 110.2 µg/m³, which is well below the 24-hour PM₁₀ NAAQS of 150 µg/m³. This leaves a compliance margin of approximately 26.5 percent. The PM₂.₅ impacts at this receptor are similarly modeled to be below the applicable annual and 24-hour NAAQS and PSD increments, as summarized in the modeling results table provided as Attachment B to this memorandum.

With respect to emission controls, the particulate matter sources that are most relevant to the commenter's concerns — grain handling, conveying, and fertilizer loadout operations — are categorized as emission unit EU-04 (material handling and storage — grain elevators, conveyors, fertilizer loadout). EU-04 is controlled by high-efficiency baghouse filters with a particulate matter outlet concentration of 0.005 grains per dry standard cubic foot ("gr/dscf") and a control efficiency of 99.5 percent. This level of control represents BACT for particulate matter from material handling operations in this industrial sector, as established through the top-down BACT analysis in the permit application. Fugitive dust emissions from unpaved internal roads and truck traffic areas are addressed through operational controls, including paving of primary haul roads, application of dust suppressants on unpaved surfaces, and speed limits for on-site vehicle traffic.

It should also be noted that Muscatine County is designated attainment for all criteria pollutants, including both PM₁₀ and PM₂.₅, under the Clean Air Act. The MEF's emissions, as modeled, will maintain the area's attainment status and will not cause or contribute to any exceedance of the NAAQS or PSD increments.

Recommended Response. We recommend preparing a written response that provides specific AERMOD modeling results for the nearest receptor location, demonstrating compliance with all NAAQS for both PM₁₀ and PM₂.₅ at the commenter's likely residence. The response should reference the BACT controls on EU-04, specifically the baghouse filters with the 0.005 gr/dscf outlet concentration and 99.5 percent control efficiency, and explain in plain language the effectiveness of these controls. The response should cite the attainment status of Muscatine County for all criteria pollutants and note that PSD increments will also be maintained. The response should be written in a tone that acknowledges the commenter's legitimate concerns about air quality and conveys GAP's commitment to operating the MEF in a manner that protects the health and well-being of neighboring residents.

B. Comment 2: Neighboring Landowner — Odor Concerns

Commenter. This comment was submitted by a second individual identified as a neighboring landowner whose residence is in the general vicinity of the MEF site. The exact location of this commenter's residence relative to the site is not specified in the comment itself.

Substance of Comment. The commenter expresses concern about potential odors from the MEF's soybean processing operations, particularly the dryer and any hexane-based solvent extraction processes, as well as from the wastewater treatment lagoon system. The commenter references prior experience with odor complaints associated with other soybean processing facilities in the region and states concern that the MEF will generate similar or worse odor conditions, particularly during warm-weather months and during nighttime temperature inversions.

Analysis. The odor concern raised by this commenter spans both the PSD air permit and the NPDES permit proceedings, as odor sources at the MEF include both air emission units (within the scope of the PSD permit) and the wastewater treatment lagoon system (addressed under the NPDES permit).

With respect to air emissions, odors from soybean processing operations are primarily associated with volatile organic compounds ("VOC"). The PSD application identifies the facility's VOC PTE at 164 tpy. The key VOC-emitting units include EU-02 (the 80 MMBtu/hr soybean dryer) and EU-03 (the fertilizer granulation dryer). Both of these units are natural gas-fired and utilize enclosed processing designs that minimize the release of fugitive VOC emissions. The use of natural gas as the combustion fuel, rather than fuel oil or other higher-emitting fuels, further reduces the potential for odor-causing emissions from these units.

If solvent extraction using hexane is part of the soybean processing operation — which is common in the industry for oil extraction — hexane emissions would be accounted for in the facility's VOC emission calculations. The PSD application's VOC inventory and controls should reflect this. However, I recommend that we confirm the specifics of the hexane extraction process and its associated emission controls with Derek Yun (GAP) and Dr. Leonard Fisk (Pinnacle Environmental) before finalizing the response to this comment.

With respect to the wastewater treatment lagoon, odor potential from lagoon systems is primarily associated with anaerobic conditions that can develop when biological oxygen demand exceeds the aeration capacity of the system. The MEF's three-cell aerated lagoon system is specifically designed to maintain aerobic conditions throughout the treatment process. The lagoon system's 4.2-acre total surface area and 18-day hydraulic retention time, combined with mechanical aeration, are intended to prevent the anaerobic conditions that are the primary cause of nuisance odors from wastewater treatment lagoons. However, the wastewater treatment system is addressed under the NPDES permit rather than the PSD air permit, and any odor-related conditions of operation for the lagoon system would more appropriately be addressed in that proceeding or through separate state regulatory mechanisms.

It should be noted that Iowa's nuisance odor provisions, including Iowa Code Chapter 657 and the Iowa Administrative Code provisions related to nuisance, are separate from and not within the scope of the PSD permitting process. The PSD permit addresses criteria pollutant and GHG emissions and the associated BACT determinations and NAAQS compliance demonstrations, but it does not directly regulate odor as a standalone parameter. Nonetheless, the facility design features and emission controls proposed in the PSD application — enclosed processing, natural gas combustion, BACT-level VOC controls — collectively serve to minimize the potential for odor impacts.

Recommended Response. We recommend preparing a written response that explains the PSD application's treatment of VOC emissions and the facility's enclosed processing design features that minimize fugitive odor emissions. The response should reference the natural gas-fired dryer systems (EU-02 and EU-03) as clean-burning and note that the facility's VOC controls are designed to minimize emissions of odor-causing compounds. The response should briefly address odor from the wastewater treatment lagoon by noting that the three-cell aerated lagoon system is designed to maintain aerobic conditions, thereby minimizing the potential for nuisance odors, and should note that the lagoon system is addressed in the NPDES permit proceeding. The response should state that Iowa's nuisance-odor framework is outside the scope of PSD permitting but that GAP is committed to good-neighbor practices and to operating the MEF in a manner that minimizes odor impacts on surrounding properties.

Before finalizing the response, we should coordinate with Derek Yun to confirm any additional odor mitigation measures that GAP is planning to implement, including any voluntary operational measures or community complaint response protocols. Any such measures can be referenced in the response to further demonstrate GAP's commitment to responsible operations. We should also confirm with Dr. Leonard Fisk and Derek Yun the details of any hexane extraction process and how hexane emissions are addressed in the VOC inventory and BACT analysis.

C. Comment 3: Heartland Environmental Alliance (HEA) — BACT Adequacy and Public Hearing Request (Air)

Commenter. Heartland Environmental Alliance ("HEA"), an Iowa unincorporated non-profit advocacy group focused on environmental policy and industrial permitting in the Midwest agricultural sector. Based on our research, HEA has participated in several prior IDNR permitting proceedings involving agricultural and industrial facilities in eastern Iowa.

Substance of Comment. HEA's comment raises two distinct issues. First, HEA questions whether the BACT analysis for NOx and PM₂.₅ is adequate, asserting that lower emission limits have been achieved at comparable facilities in other states and that the applicant failed to adequately consider selective catalytic reduction ("SCR") for NOx control on EU-01 (the 120 MMBtu/hr process heater) and EU-02 (the 80 MMBtu/hr soybean dryer). HEA contends that the applicant dismissed SCR prematurely in the top-down BACT analysis without sufficient justification and that the proposed NOx emission limit of 0.036 lb/MMBtu does not represent BACT for units of this type. Second, HEA requests that the IDNR Director convene a formal public hearing on the PSD draft permit, asserting that the complexity and potential environmental impacts of the proposed facility warrant a hearing to allow for public testimony and examination of the technical record.

Analysis — BACT.

The BACT analysis for the MEF was prepared by Dr. Leonard Fisk, P.E., of Pinnacle Environmental Consultants Inc. and follows the EPA-recommended five-step top-down methodology. We have reviewed the BACT analysis and believe it is technically sound and consistent with current regulatory practice.

NOx BACT: The application proposes low-NOx burners with flue gas recirculation ("FGR") on EU-01 (the 120 MMBtu/hr process heater) and EU-02 (the 80 MMBtu/hr soybean dryer), achieving a proposed NOx emission limit of 0.036 lb/MMBtu. In the top-down BACT analysis, Dr. Fisk evaluated all available control technologies for NOx emissions from natural gas-fired combustion units, beginning with the most stringent. SCR was identified at the top of the control technology hierarchy and was evaluated in the first step. However, based on a detailed cost-effectiveness analysis, SCR was determined not to be cost-effective for natural gas-fired combustion units of this size in the agricultural processing sector. The cost-per-ton of NOx removal for SCR on these units was calculated to significantly exceed established cost-effectiveness thresholds that have been accepted in prior BACT determinations for similar sources. Specifically, the analysis concluded that the annualized cost of SCR on EU-01 and EU-02 would result in a cost-effectiveness ratio substantially above the range of $5,000 to $10,000 per ton of NOx removed that has been considered the upper bound of cost-effectiveness for SCR on natural gas-fired units of this class in recent EPA and state permitting decisions.

Dr. Fisk's analysis included a review of the EPA RACT/BACT/LAER Clearinghouse ("RBLC") and comparable recent PSD permits for soybean processing and similar agricultural processing facilities. The review identified that the proposed NOx limit of 0.036 lb/MMBtu is consistent with or more stringent than limits imposed on recent comparable sources. The RBLC entries cited in the application include permits issued in Illinois, Minnesota, Nebraska, and Indiana for soybean processing and grain handling facilities with natural gas-fired combustion units of comparable size. None of those permits required SCR; the prevailing BACT determination for these sources is low-NOx burners with FGR.

HEA's assertion that "lower emission limits have been achieved at comparable facilities" does not cite specific permits or facilities, and our review of the RBLC does not identify any BACT determinations for comparable sources (i.e., natural gas-fired units in the agricultural processing sector of similar size) that imposed limits significantly below 0.036 lb/MMBtu without SCR, or that required SCR. If HEA is referencing permits for larger industrial boilers or units in other sectors (such as petroleum refining or power generation), those are not appropriate comparisons due to differences in unit size, fuel type, operating profile, and sector-specific economic considerations relevant to the BACT cost-effectiveness analysis.

PM₂.₅ BACT: The BACT determination for PM₂.₅ from EU-04 (grain handling and material handling) is baghouse filters with a particulate matter outlet concentration of 0.005 gr/dscf and a control efficiency of 99.5 percent. This level of control is consistent with the most stringent limits achievable with fabric filter technology and represents BACT for PM₂.₅ from material handling operations. For EU-06 (cooling towers), the BACT determination is high-efficiency drift eliminators with a drift rate of 0.0005 percent, which is the industry-standard minimum-achievable drift rate for modern cooling tower systems. The modeled PM₂.₅ impacts from the facility (87 tpy PTE) demonstrate compliance with both the 24-hour and annual PM₂.₅ NAAQS and the applicable PSD increments at all off-site receptor locations.

We are confident that the BACT analysis in the permit application is technically defensible and consistent with current regulatory precedent for comparable sources. HEA's challenge does not identify specific factual or analytical errors in the BACT analysis but instead offers generalized assertions that a more stringent result should have been reached. The written response should address HEA's assertions directly and thoroughly, with supporting data from the RBLC and comparable permits.

Analysis — Public Hearing Request.

Under Iowa Administrative Code 567—Chapter 33, the IDNR Director has discretion to hold a public hearing on a PSD draft permit if there is "significant public interest." The determination of whether significant public interest exists is a judgment call for the Director, informed by the number and nature of public comments received, the complexity and potential environmental impacts of the proposed action, and whether the issues raised can be adequately addressed through the written responsiveness summary process.

In this proceeding, a total of four (4) comments were received during the 30-day public notice period. Of these, two are from neighboring landowners raising localized concerns about particulate matter and odor, one is from the Muscatine County SWCD raising a stormwater-related concern that is more appropriately directed to the NPDES proceeding, and one is from HEA raising BACT issues and the hearing request itself. This level of comment activity does not, in our assessment, demonstrate the degree of public interest that would require the Director to exercise discretion in favor of convening a hearing. The comments are relatively limited in number and scope, and all of the substantive issues raised can be comprehensively addressed through the written responsiveness summary.

In prior IDNR PSD permitting proceedings for agricultural and industrial sources, our research indicates that public hearings have not been granted in cases where fewer than approximately ten comments were received and where the comments could be substantively addressed in the responsiveness summary. Conversely, hearings have been granted where there was substantial public opposition, organized community attendance at informational meetings, or complex contested technical issues that could not be adequately resolved through written responses. Neither of those conditions is present here.

HEA's request for a hearing does not cite specific factual disputes that would require oral testimony, cross-examination of witnesses, or any other procedural mechanism not available through the written comment and response process. The BACT issues raised by HEA are technical in nature and can be fully addressed through a detailed written response supported by the RBLC data and cost-effectiveness analysis. Granting a hearing would introduce unnecessary procedural delay — potentially four to six weeks for scheduling, hearing, and post-hearing briefing — without a corresponding benefit to the public participation process.

Recommended Response. We recommend preparing a detailed written response to HEA's BACT assertions, organized as follows:

1. Reference the five-step top-down BACT analysis methodology employed in the application, consistent with EPA guidance;

2. Present the specific RBLC data and comparable permit limits for soybean processing facilities with natural gas-fired combustion units, demonstrating that the proposed 0.036 lb/MMBtu NOx limit is consistent with or more stringent than prevailing BACT determinations;

3. Summarize the cost-effectiveness analysis for SCR, demonstrating that SCR exceeds established cost-effectiveness thresholds for units of this type and size;

4. Address the PM₂.₅ BACT determination, referencing the 0.005 gr/dscf baghouse filter performance and the 0.0005% drift rate for cooling tower drift eliminators; and

5. Present the AERMOD modeling results demonstrating compliance with all PM₂.₅ NAAQS and PSD increments.

With respect to the public hearing request, the response should note the small number and limited nature of comments received during the public notice period and explain that the written responsiveness summary process provides adequate opportunity for meaningful public participation and thorough agency review of the issues raised. The response should state GAP's position that a public hearing is not warranted and that all substantive comments can be and will be fully addressed in writing.

We should coordinate closely with Dr. Leonard Fisk of Pinnacle Environmental for technical support on the BACT rebuttal, including preparation of a summary table of RBLC entries and comparable permit determinations for attachment to the response. The target date for submission of the written responses to the four PSD air permit comments to IDNR (Jonathan Kreske, P.E.) is on or before July 28, 2023, to allow IDNR sufficient time to finalize the responsiveness summary by its anticipated August 3, 2023 date.

D. Comment 4: Muscatine County Soil & Water Conservation District (SWCD) — Stormwater Controls

Commenter. Muscatine County Soil & Water Conservation District ("SWCD"), a county-level conservation agency established under Iowa Code Chapter 161A.

Substance of Comment. The SWCD requests clarification on the adequacy of stormwater management controls for the 147-acre MEF site, with particular attention to controls for runoff from the fertilizer loadout area, which will discharge through Outfall 002 under the NPDES permit. The SWCD acknowledges in its comment that the comment was submitted during the PSD air permit comment period but that the substance of the comment relates primarily to stormwater and water quality issues. The SWCD specifically asks whether the stormwater management plan addresses potential nutrient loading from fertilizer handling areas and whether first-flush capture is incorporated into the stormwater conveyance system.

Analysis. The PSD air construction permit does not directly address stormwater discharges or stormwater management controls; those matters fall within the scope of the NPDES permit proceeding. Accordingly, this comment is somewhat procedurally misdirected, although it raises legitimate and relevant substantive concerns that should be addressed.

The Stormwater Pollution Prevention Plan ("SWPPP") prepared by Karen Ott of Pinnacle Environmental details the structural and non-structural BMPs for stormwater management at the MEF site. Structural BMPs include the following: stormwater from the fertilizer loadout pad is collected and directed through a lined detention basin designed to capture the first flush of runoff (defined as the first 0.5 inches of rainfall over the contributing drainage area). This first-flush capture system ensures that the initial, most pollutant-laden runoff is detained and treated before any discharge occurs through Outfall 002. Additional structural controls include curbed containment areas around chemical and fertilizer storage facilities, oil-water separators for truck wash wastewater, and vegetated buffer strips along the perimeter of the facility's stormwater conveyance system.

Non-structural BMPs include regular inspection and maintenance of all stormwater controls (on a quarterly basis and within 24 hours of any storm event producing 0.5 inches or more of precipitation), employee training on spill prevention and response, housekeeping protocols for the fertilizer loadout pad and truck staging areas, and record-keeping requirements for all inspections and maintenance activities.

The stormwater management plan for the site was designed by Thomas Novak, P.E., of Ridgeline Engineering Group LLC, in coordination with Pinnacle Environmental. The design incorporates site-specific hydrologic analysis and is sized to accommodate the 10-year, 24-hour design storm event for Muscatine County.

Outfall 002 will be subject to benchmark monitoring under the NPDES permit, including monitoring for total suspended solids, total phosphorus, total nitrogen, pH, and oil and grease. Benchmark monitoring results will be compared to established benchmark values, and corrective actions will be implemented if benchmark exceedances occur.

Recommended Response. We recommend preparing a written response that acknowledges the SWCD's comment and redirects the commenter to the NPDES permit proceeding, where stormwater controls are directly addressed. The response should provide a brief but informative summary of the SWPPP controls, including the fertilizer loadout pad detention basin with first-flush capture, curbed containment areas, oil-water separators, vegetated buffer strips, and the inspection and maintenance protocols. The response should note that Outfall 002 will be subject to benchmark monitoring under the NPDES permit and that GAP is committed to effective stormwater management to protect Sweetland Creek and the surrounding watershed.

We should coordinate with Karen Ott of Pinnacle Environmental and Thomas Novak, P.E., of Ridgeline Engineering Group LLC for site-specific design details to ensure that the response accurately describes the stormwater management plan. Given the SWCD's role as a county-level conservation agency, the response should be particularly thorough and respectful, as the SWCD may be a resource for GAP in ongoing community relations and conservation compliance during the construction and operational phases of the MEF.

IV. Summary and Analysis of Public Comments — NPDES Permit

This section provides a detailed summary and analysis of each of the two public comments received during the NPDES permit public notice period (June 19 – July 19, 2023), together with recommended response approaches. Full copies of all comments are compiled in Attachment A.

A. Comment 5: Heartland Environmental Alliance (HEA) — Public Hearing Request (NPDES)

Commenter. Heartland Environmental Alliance ("HEA"), the same organization that submitted Comment 3 in the PSD air permit proceeding.

Substance of Comment. HEA requests that the IDNR Director convene a formal public hearing on the NPDES draft permit. In support of this request, HEA expresses general concern about the discharge of treated process wastewater from the MEF to Sweetland Creek and questions whether the IDNR's antidegradation review was adequate. Specifically, HEA contends that IDNR should have conducted a Tier 2 antidegradation review, including an alternatives analysis, rather than limiting the review to Tier 1 (existing uses maintained). HEA asserts that a new industrial discharge to Sweetland Creek may constitute a "significant lowering of water quality" that would trigger Tier 2 review and that IDNR's preliminary determination to the contrary was insufficiently justified.

Analysis.

Antidegradation Review. The IDNR's antidegradation review for the MEF NPDES permit concluded that the proposed discharge warrants Tier 1 analysis (existing uses maintained), with a preliminary determination that no Tier 2 alternatives analysis is required. Under Iowa's antidegradation implementation procedures, codified in Iowa Administrative Code 567—Chapter 61, Tier 1 review requires a demonstration that existing uses of the receiving water will be maintained and protected. Tier 2 review — which includes an alternatives analysis, an assessment of social and economic importance, and an evaluation of whether a significant lowering of water quality will occur — is required only when the proposed activity would result in a lowering of water quality that exceeds de minimis levels and where the receiving water's quality exceeds the levels necessary to support propagation of fish, shellfish, and wildlife and recreation in and on the water.

The Tier 1 determination for the MEF discharge is appropriate for several reasons. The proposed effluent limits are specifically designed to maintain all existing and designated uses of Sweetland Creek, including its Class A1 (Primary Contact Recreation) and Class B(WW) (Warm Water Aquatic Life) classifications. The treatment system — equalization basin, DAF, three-cell aerated lagoon, and UV disinfection — produces effluent quality consistent with or better than secondary treatment standards and applicable Iowa water quality standards for each parameter. The proposed limits for BOD₅ (30/45 mg/L), TSS (30/45 mg/L), NH₃-N (3.5 mg/L seasonal / 8.0 mg/L seasonal), Total Phosphorus (1.0 mg/L), Oil & Grease (10 mg/L), and Fecal Coliform (200 CFU/100 mL) are designed to ensure that the discharge does not degrade existing water quality or impair designated uses.

Furthermore, the 0.38 MGD design flow from Outfall 001 represents a relatively modest discharge volume relative to the flow characteristics of Sweetland Creek, and mixing zone and dilution analyses performed by Pinnacle Environmental indicate that the proposed effluent limits will result in in-stream concentrations at and downstream of the point of discharge that remain within applicable water quality criteria.

IDNR's preliminary Tier 1 determination is consistent with the agency's prior practice for new industrial discharges of this type and size to receiving waters with similar use classifications. We believe the determination is well-supported by the record and defensible against HEA's challenge.

Public Hearing Request. Under Iowa Administrative Code 567—Chapter 64 (and parallel federal NPDES regulations at 40 C.F.R. § 124.12), a public hearing on a draft NPDES permit is discretionary with the IDNR Director when there is "significant public interest." Only two (2) comments were received during the entire 30-day NPDES public notice period. This level of comment activity is modest by any measure and does not demonstrate the degree of public interest that would support the exercise of the Director's discretion to convene a hearing. As with the PSD hearing request discussed in Section III.C above, the written responsiveness summary process provides an adequate and appropriate mechanism for addressing the issues raised.

HEA's hearing request does not identify specific factual disputes that would require oral testimony, live presentation of evidence, or cross-examination. The antidegradation questions raised by HEA are matters of regulatory interpretation and application that can be fully addressed through a written response referencing the applicable regulatory provisions, the technical record supporting the Tier 1 determination, and IDNR's prior practice in comparable permit proceedings.

Recommended Response. We recommend preparing a written response to HEA's comment that addresses both the antidegradation challenge and the public hearing request. On antidegradation, the response should explain the Tier 1 basis: the proposed discharge is designed to maintain all existing and designated uses of Sweetland Creek, the proposed effluent limits meet or exceed applicable water quality standards, and the multi-stage treatment system provides robust treatment ensuring high-quality effluent. The response should reference the specific proposed effluent limits (BOD₅ 30/45, TSS 30/45, NH₃-N 3.5/8.0 seasonal, TP 1.0, Oil & Grease 10, Fecal Coliform 200 CFU/100 mL) and describe the multi-stage treatment system's design and expected performance. The response should explain that IDNR's determination that Tier 2 review is not required is consistent with the Iowa antidegradation implementation procedures and with the agency's practice for comparable industrial discharges.

On the public hearing request, the response should note the limited number of comments received (two) and the nature of the issues raised, and should state GAP's position that a hearing is not warranted. This position is consistent with the recommendation on the PSD hearing request in Section III.C above, and the responses to both hearing requests should be coordinated for consistency.

The target date for submission of the written responses to the two NPDES permit comments to IDNR (Amy Lindstrom) is on or before approximately August 1, 2023, to allow IDNR sufficient time to finalize the NPDES responsiveness summary by its anticipated August 10, 2023 date.

B. Comment 6: Prairie Farmers Coalition (PFC) — Sweetland Creek Water Quality and Irrigation Concerns

Commenter. Prairie Farmers Coalition ("PFC"), identified as the Iowa Chapter of the National Farmers Union. PFC is an agricultural advocacy organization representing the interests of family farmers in Iowa. The comment is submitted on behalf of PFC's membership, which includes agricultural producers with operations along Sweetland Creek downstream of the MEF site.

Substance of Comment. PFC expresses concern about potential impacts on Sweetland Creek water quality downstream of Outfall 001, with particular focus on nutrient discharges — specifically phosphorus and nitrogen — and the potential effects on downstream agricultural irrigation water quality. PFC notes that several of its member farmers use water from Sweetland Creek for crop irrigation, particularly during the growing season (approximately April through September), and states concern that the proposed industrial discharge may introduce nutrient levels or other contaminants that would degrade the creek's suitability for agricultural irrigation use. PFC asks whether the proposed discharge will comply with applicable water quality standards at points downstream where irrigation intakes are located and whether any monitoring of the discharge's downstream effects is planned.

Analysis. PFC's comment raises a substantive and legitimate concern that can be addressed through reference to the proposed effluent limits, the receiving water's use classifications, and the antidegradation analysis.

Nutrient Limits. The proposed Total Phosphorus limit of 1.0 mg/L (monthly average) is among the more stringent limits imposed on industrial NPDES permits in Iowa and is specifically designed to protect Sweetland Creek's water quality from nutrient enrichment and eutrophication. This limit is derived from Iowa's water quality standards and reflects the nutrient criteria applicable to the receiving water's designated uses. The proposed ammonia nitrogen ("NH₃-N") limits — 3.5 mg/L during the April-through-October period and 8.0 mg/L during the November-through-March period — are seasonal limits that reflect the more stringent water quality criteria applicable during the warm-water months when aquatic organisms are most sensitive to ammonia toxicity and when irrigation use is most active.

Use Classifications and Irrigation. Sweetland Creek is classified as Class A1 (Primary Contact Recreation) and Class B(WW) (Warm Water Aquatic Life) under Iowa's water quality standards. The Class A1 classification encompasses protection of water quality for a range of beneficial uses, which includes, among others, uses such as irrigation. The water quality criteria associated with the Class A1 and Class B(WW) classifications establish the standards against which the proposed discharge is evaluated, and the proposed effluent limits are designed to ensure compliance with these criteria at the point of discharge and at all points downstream.

Antidegradation. The Tier 1 antidegradation determination ensures that existing uses of Sweetland Creek, including any current agricultural irrigation use by PFC members and other downstream users, will be maintained and protected. The Tier 1 standard requires a demonstration that the proposed discharge will not impair existing uses, and the technical analysis supporting the determination — including the proposed effluent limits, treatment system design, and receiving-water analysis — provides that demonstration.

Discharge Volume. The 0.38 MGD design flow from Outfall 001 represents a relatively modest discharge relative to Sweetland Creek's flow, particularly during the irrigation season when creek flows are typically sufficient to provide substantial dilution. The receiving-water characterization data compiled by Pinnacle Environmental (Karen Ott) includes flow data for Sweetland Creek at the proposed discharge point and at downstream locations, and the analysis confirms that the proposed effluent limits, in combination with available dilution, will result in in-stream concentrations at downstream irrigation intake points that are well within applicable water quality criteria.

Treatment System Performance. The multi-stage treatment system (equalization basin → DAF → three-cell aerated lagoon → UV disinfection) is designed to achieve consistent, high-quality effluent that meets or exceeds the proposed effluent limits. The 18-day hydraulic retention time in the aerated lagoon system provides extended biological treatment and nutrient reduction. The UV disinfection system addresses pathogen concerns, ensuring that the discharge does not introduce fecal coliform or other microbiological contaminants at levels that would impair downstream uses.

Recommended Response. We recommend preparing a written response that addresses PFC's concerns directly and comprehensively. The response should:

1. Explain the proposed nutrient limits — Total Phosphorus 1.0 mg/L and NH₃-N 3.5/8.0 mg/L seasonal — and their derivation from Iowa water quality standards designed to protect receiving waters from nutrient impairment;

2. Describe the multi-stage treatment train and its effectiveness in producing high-quality effluent that meets or exceeds the proposed limits;

3. Address the irrigation concern by referencing the Class A1 use classification of Sweetland Creek, which encompasses protection of water quality for uses including irrigation, and the Tier 1 antidegradation determination, which ensures that existing uses — including agricultural irrigation — are maintained;

4. Note the proposed NPDES permit's monitoring requirements, which will include regular monitoring of effluent quality at Outfall 001 and reporting to IDNR, providing an ongoing mechanism for verification of compliance with all effluent limits; and

5. Express GAP's willingness to engage with downstream agricultural users and the community regarding the facility's operations and environmental performance.

We should coordinate with Karen Ott of Pinnacle Environmental for receiving-water characterization data, including flow data for Sweetland Creek and downstream water quality information, to ensure that the response is supported by site-specific data. We should also coordinate with Derek Yun (GAP) regarding any community outreach efforts that GAP may undertake with downstream agricultural users, including PFC members. Any such outreach efforts can be referenced in the response as evidence of GAP's commitment to responsible operations and community engagement.

V. Consolidated Recommended Response Strategy

A. Response Priorities and Timeline

The following table summarizes the recommended timeline for preparation and submission of written responses to IDNR:

Both targeted permit issuance dates are well within the Briarwood permit milestone deadline of October 5, 2023. However, as noted in Section I, the buffer is not unlimited, and efficient management of the response process is essential to avoid any unforeseen delays.

B. Coordination with Client and Consultants

Effective preparation of the written responses will require coordination with the following individuals:

• Derek Yun, GAP Director of EHS: Mr. Yun is the primary client contact for environmental permitting matters. He should be consulted to confirm factual information regarding facility operations, odor mitigation measures, community outreach efforts, and any additional operational controls that GAP intends to implement. Mr. Yun's review of the draft responses is essential to ensure factual accuracy.

• Margaret Solberg, GAP VP of Operations / Muscatine Project Lead: Ms. Solberg is available for questions regarding facility design and operational parameters, including process details for the soybean crush and fertilizer blending operations. She may be particularly helpful in confirming details regarding the hexane extraction process referenced in Comment 2 (odor concerns).

• Dr. Leonard Fisk, P.E., Pinnacle Environmental Consultants Inc.: Dr. Fisk is the licensed professional engineer who prepared the BACT analysis and the AERMOD dispersion modeling for the PSD application. He should provide technical support for the BACT rebuttal to HEA's Comment 3, including preparation of a summary table of RBLC entries and comparable permit limits, and verification of the cost-effectiveness analysis for SCR. Dr. Fisk should also provide the detailed modeling results for the nearest receptor for inclusion in the response to Comment 1 (particulate matter concerns).

• Karen Ott, Pinnacle Environmental Consultants Inc.: Ms. Ott prepared the NPDES permit application, the wastewater treatment system design basis, and the SWPPP. She should provide technical support for the NPDES-related responses, including receiving-water characterization data for Sweetland Creek, wastewater treatment performance data and design specifications, and SWPPP details for the Outfall 002 response. Ms. Ott should also confirm the basis for the Tier 1 antidegradation determination for the response to HEA's Comment 5.

• Thomas Novak, P.E., Ridgeline Engineering Group LLC: Mr. Novak prepared the stormwater management plan for the MEF site, including the design of the detention basin and first-flush capture system for the fertilizer loadout pad. He should provide site-specific design details for inclusion in the response to SWCD's Comment 4 (stormwater controls).

C. Public Hearing Recommendation

Based on the analysis set forth in Sections III.C and IV.A above, we recommend advising IDNR that GAP does not believe a public hearing is warranted on either the PSD air permit or the NPDES permit. The reasoning supporting this recommendation is as follows:

1. Limited comment volume. Only six (6) total comments were received across both proceedings — four on the PSD air permit and two on the NPDES permit. This level of public participation, while not insignificant, does not demonstrate the "significant public interest" that would support the exercise of IDNR's discretion to convene a hearing under Iowa Administrative Code 567—Chapter 33 (air) or 567—Chapter 64 (water).

2. Adequacy of written response process. All comments received can be substantively and thoroughly addressed through written responses prepared by GAP and incorporated into the IDNR responsiveness summaries. The substantive issues raised — BACT adequacy, particulate matter impacts, odor, stormwater controls, antidegradation, nutrient limits, and irrigation concerns — are matters that lend themselves to written technical and regulatory analysis. There are no contested factual issues that require oral testimony or cross-examination to resolve.

3. Nature of HEA's hearing requests. HEA's hearing requests on both permits do not identify specific factual disputes requiring oral testimony or the procedural mechanisms available in a hearing but not in the written comment process. The requests are general in nature and, respectfully, appear to reflect a policy preference for heightened public engagement rather than a demonstration that the written process is inadequate for the issues at hand.

4. Schedule risk. While a public hearing would be unlikely, in our estimation, to push the permit issuance schedule past the October 5, 2023 Briarwood milestone deadline, it would create unnecessary schedule risk. Scheduling, conducting, and post-processing a public hearing typically adds four to six weeks to the permitting timeline. Given the financing implications of any delay, prudent risk management counsels against any course of action that could introduce unnecessary scheduling uncertainty.

If IDNR nonetheless determines that a hearing is necessary on one or both permits — a scenario we consider unlikely based on the record and IDNR's past practice — we recommend that Calderwood & Harkness prepare GAP witnesses for testimony at the hearing. The most appropriate witnesses would be Derek Yun (GAP Director of EHS) and/or Margaret Solberg (GAP VP of Operations / Muscatine Project Lead), supplemented by expert testimony from Dr. Leonard Fisk (Pinnacle Environmental, for air quality matters) and Karen Ott (Pinnacle Environmental, for water quality matters). Calderwood & Harkness should coordinate with Pinnacle Environmental to prepare direct testimony and anticipate potential cross-examination questions, particularly on the BACT analysis and antidegradation review. However, as stated, we believe this scenario is unlikely and do not recommend that significant resources be allocated to hearing preparation at this time.

D. Tone and Approach

The written responses to all six comments should adhere to the following principles regarding tone and approach:

• Technical, factual, and respectful. All responses should be grounded in the technical record and regulatory standards. The responses should demonstrate thorough regulatory analysis, cite specific data and regulatory provisions, and convey GAP's willingness to engage with legitimate community concerns in a transparent and constructive manner.

• Non-adversarial toward advocacy organizations and agricultural groups. The responses to HEA's and PFC's comments should avoid an adversarial or dismissive tone. HEA and PFC are advocacy organizations that represent constituencies with legitimate interests in environmental protection and agricultural sustainability, respectively. The responses should focus on the technical data and regulatory standards rather than on characterizing the commenters' motivations or credibility.

• Community-oriented for neighboring landowners. The responses to Comments 1 and 2 (neighboring landowners) should include references to GAP's commitment to being a responsible community member and neighbor. These responses should acknowledge the landowners' concerns as understandable and valid, describe the robust control technologies being installed at the MEF (baghouse filters, low-NOx burners, UV disinfection, aerated lagoon treatment, etc.), and convey GAP's intention to operate the facility in a manner that is protective of the surrounding community's health, safety, and quality of life.

• Consistent messaging. The responses across both permit proceedings should be consistent in factual representations, regulatory positions, and overall tone. In particular, the responses to HEA's two hearing requests (Comments 3 and 5) should present a unified position and reasoning, adapted as necessary to the specific regulatory frameworks governing each proceeding.

VI. Action Items and Next Steps

The following action items summarize the next steps required to implement the response strategy recommended in this memorandum:

1. Cynthia Ho to prepare draft written responses to the four PSD air permit comments (Comments 1–4) for Rafael Dominguez's review. Target completion: July 24, 2023.

2. Cynthia Ho to prepare draft written responses to the two NPDES permit comments (Comments 5–6) for Rafael Dominguez's review. Target completion: July 26, 2023.

3. Rafael Dominguez to circulate the PSD air permit response drafts to Derek Yun (GAP) and Dr. Leonard Fisk (Pinnacle Environmental) for factual and technical verification. Target circulation: July 24, 2023; comments returned by July 27, 2023.

4. Rafael Dominguez to circulate the NPDES permit response drafts to Derek Y

PRIVILEGED AND CONFIDENTIAL — ATTORNEY WORK PRODUCT
MEMORANDUM
TO: Rafael Dominguez, Lead Associate, Real Estate, Calderwood & Harkness LLP
FROM: Cynthia Ho, Working Associate, Real Estate, Calderwood & Harkness LLP
DATE: July 20, 2023
RE: Public Comment Response Strategy — PSD Air Permit Application (IDNR) and NPDES Permit Application (IDNR) for Muscatine Expansion Facility — Greenfield Agricultural Partners LLC
C&H Matter No.: 1020-00004
I. Purpose and Executive Summary
The purpose of this memorandum is to analyze all public comments received during the two public notice and comment periods conducted by the Iowa Department of Natural Resources ("IDNR") for (i) the Prevention of Significant Deterioration ("PSD") air construction permit application and (ii) the National Pollutant Discharge Elimination System ("NPDES") individual permit application, each submitted on behalf of our client, Greenfield Agricultural Partners LLC ("GAP"), for the Muscatine Expansion Facility ("MEF") located at 14800 Highway 61 North, Muscatine, Iowa 52761. This memorandum provides a comment-by-comment analysis and recommends response approaches for each comment in coordination with IDNR staff as they prepare their respective responsiveness summaries for both permit proceedings.
A total of six (6) public comments were received across the two proceedings. These are summarized as follows:
PSD Air Permit (public notice period: June 12 – July 12, 2023): Four (4) comments were received:
• Two comments from neighboring landowners raising concerns about particulate matter and odor, respectively;
• One comment from Heartland Environmental Alliance ("HEA"), an Iowa unincorporated non-profit advocacy group, challenging the adequacy of the Best Available Control Technology ("BACT") analysis for NOx and PM₂.₅ and requesting a formal public hearing on the PSD draft permit; and
• One comment from the Muscatine County Soil & Water Conservation District ("SWCD") requesting clarification on stormwater management controls (which, though submitted during the air permit comment period, substantively relates to the NPDES permit proceeding).
NPDES Permit (public notice period: June 19 – July 19, 2023): Two (2) comments were received:
• One comment from HEA requesting a public hearing on the NPDES draft permit and questioning the adequacy of the antidegradation review; and
• One comment from the Prairie Farmers Coalition ("PFC"), the Iowa Chapter of the National Farmers Union, raising concerns about impacts on Sweetland Creek water quality and downstream agricultural irrigation uses.
Overall Assessment. After careful analysis, it is my assessment that the comments received are manageable. None of the comments raise issues that would require material modifications to either draft permit, and, considered individually and collectively, the comments do not support the need for a formal public hearing on either permit. The substantive concerns raised by commenters can be fully and adequately addressed through written responses prepared by GAP, through Calderwood & Harkness, for submission to IDNR for incorporation into the IDNR responsiveness summaries. The IDNR Air Quality Bureau's responsiveness summary is anticipated to be issued on or about August 3, 2023, and the IDNR Water Quality Bureau's responsiveness summary is anticipated to be issued on or about August 10, 2023.
Permit Issuance Timeline and Financing Implications. It is important to note that the permit issuance timeline is sensitive from a transactional perspective. The Briarwood Capital Partners LP credit agreement (Reference No. BCP-AG-2023-0092, dated February 15, 2023), which provides the project's principal debt financing, requires that all material environmental permits for the MEF be obtained within 210 calendar days from March 9, 2023 — i.e., by October 5, 2023 — as a condition precedent to the $89 million second drawdown tranche. Any significant delay in the issuance of either the PSD air permit or the NPDES permit would jeopardize this critical financing milestone. As discussed in Section V below, the current projected issuance dates for both permits (PSD: August 22, 2023; NPDES: September 1, 2023, effective October 1, 2023) provide a reasonable but not unlimited buffer to the October 5, 2023 deadline. This underscores the importance of managing the public comment response process efficiently and avoiding any triggering event, such as a contested public hearing, that could introduce delay.
Coordination. The factual and technical information underlying this memorandum has been obtained from Derek Yun, GAP's Director of Environmental, Health, and Safety ("EHS"), as well as from Pinnacle Environmental Consultants Inc. ("Pinnacle Environmental"), specifically Dr. Leonard Fisk, P.E. (for air quality matters) and Karen Ott (for water quality matters), who served as the primary technical consultants on the PSD and NPDES applications, respectively.
II. Background on the Permitting Proceedings
This section summarizes the key parameters of each permitting proceeding and the characteristics of the MEF to provide context for the comment analysis that follows.
A. PSD Air Permit Application
GAP filed its PSD air construction permit application with the IDNR Air Quality Bureau on April 28, 2023. The application was assigned to Jonathan Kreske, P.E., as the lead permit reviewer within the Bureau. IDNR issued a completeness determination on May 19, 2023, confirming that the application contained all information necessary for substantive review. Following IDNR's preparation of a draft permit, the public notice period commenced on June 12, 2023 and concluded on July 12, 2023, spanning the required 30-day period.
Facility Description. The MEF is a greenfield industrial facility proposed for construction on a 147-acre site in Muscatine County, Iowa (Parcel ID 0735-19-200-004). The facility will conduct two primary operations: (1) soybean processing, with a crush capacity of 3,200 tons per day, and (2) specialty fertilizer blending, consisting of a 450 tons-per-day granular blending line. The site is currently undeveloped agricultural land and was acquired by GAP from the Reinholt Family Trust on January 20, 2023 for $3,820,000.
PSD Applicability. PSD review is triggered for the MEF because the facility's potential to emit ("PTE") for nitrogen oxides ("NOx") is 312 tons per year ("tpy"), which exceeds the 250 tpy major-source threshold applicable to source categories not listed among the 28 named source categories in 40 C.F.R. § 52.21(b)(1)(i). Additionally, the facility's greenhouse gas ("GHG") emissions, calculated at 148,600 tpy of carbon dioxide equivalent ("CO₂e"), trigger PSD review for GHG as an "anyway" source — i.e., a source that is already subject to PSD review for at least one conventional pollutant (here, NOx) and exceeds the 75,000 tpy CO₂e significance threshold for GHG. Accordingly, a BACT analysis is required for NOx, particulate matter less than 10 micrometers in diameter ("PM₁₀"), particulate matter less than 2.5 micrometers in diameter ("PM₂.₅"), and CO₂e.
Attainment Status. Muscatine County is designated attainment for all criteria pollutants under the Clean Air Act, including PM₁₀, PM₂.₅, ozone, NOx, SO₂, CO, and lead. As a result, the PSD program, rather than the nonattainment New Source Review ("NSR") program, applies.
Air Dispersion Modeling. Air quality dispersion modeling was conducted using AERMOD Version 23.1, the current EPA-approved regulatory model. The modeling utilized a five-year meteorological dataset (2018–2022) from Muscatine Municipal Airport (station identifier KMUT), which is the nearest representative National Weather Service station to the project site. The receptor grid was configured at 50-meter spacing extending outward to a distance of 5 kilometers from the proposed emission sources. The modeling analysis evaluated all relevant averaging periods and pollutants for comparison to applicable National Ambient Air Quality Standards ("NAAQS") and PSD increments.
Key modeling results include a maximum modeled 24-hour PM₁₀ impact of 38.2 µg/m³ at the nearest receptor location, which, when combined with the monitored background concentration of 72 µg/m³, yields a total impact of 110.2 µg/m³. This total is well below the 24-hour PM₁₀ NAAQS of 150 µg/m³, leaving a compliance margin of approximately 39.8 µg/m³ (26.5 percent of the standard). Modeled PM₂.₅ impacts are similarly below the applicable NAAQS and PSD increments, as detailed in Attachment B.
Nearest Receptor. The nearest sensitive receptor is a residential property located approximately 0.42 miles (2,218 feet) east-northeast of the proposed stack location for EU-01, the primary process heater. This receptor location is a key reference point for several of the public comments discussed below.
B. NPDES Permit Application
GAP filed its NPDES individual permit application with the IDNR Water Quality Bureau on May 5, 2023. The application was assigned to Amy Lindstrom as the lead permit reviewer. IDNR issued a completeness determination on May 30, 2023. Following IDNR's preparation of a draft permit, the public notice period commenced on June 19, 2023 and concluded on July 19, 2023, spanning the required 30-day period.
Discharge Configuration. The MEF will have two discharge outfalls:
• Outfall 001: Treated process wastewater, including soybean wash water and cooling tower blowdown, with a design flow of 0.38 million gallons per day ("MGD"). This outfall will discharge on a continuous basis during facility operations.
• Outfall 002: Industrial stormwater from paved areas, the fertilizer loadout pad, and the truck wash facility. This outfall will discharge on an intermittent, storm event-driven basis.
Receiving Water. Both outfalls will discharge to Sweetland Creek, a tributary of the Mississippi River. Sweetland Creek is classified under Iowa's water quality standards as Class A1 (Primary Contact Recreation) and Class B(WW) (Warm Water Aquatic Life). These use classifications establish the applicable water quality criteria against which the proposed discharge is evaluated.
Treatment System. The MEF's wastewater treatment system for Outfall 001 consists of a multi-stage treatment train designed to achieve effluent quality consistent with applicable Iowa water quality standards. The treatment system includes the following sequential components: (1) an equalization basin for flow and load balancing; (2) a dissolved air flotation ("DAF") unit for removal of suspended solids and fats, oils, and grease; (3) a three-cell aerated lagoon system with a total surface area of 4.2 acres and a design hydraulic retention time of 18 days, providing secondary biological treatment; and (4) ultraviolet ("UV") disinfection for pathogen reduction prior to discharge.
Proposed Effluent Limits (Outfall 001). The draft permit proposes the following effluent limitations for Outfall 001:
Antidegradation Review. IDNR conducted an antidegradation review in accordance with Iowa Administrative Code 567—Chapter 61 and the Iowa antidegradation implementation procedures. The review concluded that the proposed discharge warrants a Tier 1 analysis (existing uses maintained). IDNR issued a preliminary determination that no Tier 2 alternatives analysis is required. The Tier 1 determination reflects that the proposed effluent limits are designed to maintain, and will not impair, the existing and designated uses of Sweetland Creek, including its Class A1 and Class B(WW) classifications.
Stormwater Pollution Prevention Plan. For Outfall 002, Pinnacle Environmental (Karen Ott) prepared a Stormwater Pollution Prevention Plan ("SWPPP") in accordance with IDNR and EPA requirements. The SWPPP details the structural and non-structural best management practices ("BMPs") that will be employed to manage stormwater discharges from paved areas, the fertilizer loadout pad, and the truck wash facility. Outfall 002 will be subject to benchmark monitoring requirements under the NPDES permit.
C. Local Approvals Already in Place
It bears noting that the principal local land use approval for the MEF has already been obtained. Conditional Use Permit No. MC-2022-041 was approved on November 15, 2022 by the Muscatine County Board of Supervisors, confirming the site's zoning as Agricultural-Industrial ("AI") and authorizing the proposed soybean processing and fertilizer blending operations. The conditional use permit proceeding included its own public notice and comment process, which concluded without significant opposition. The site itself was acquired from the Reinholt Family Trust on January 20, 2023 for a purchase price of $3,820,000 (147 acres). These local approvals are separate from and do not bear directly on the state environmental permitting proceedings addressed in this memorandum, but they confirm that the project has navigated its local regulatory requirements without material controversy.
III. Summary and Analysis of Public Comments — PSD Air Permit
This section provides a detailed summary and analysis of each of the four public comments received during the PSD air permit public notice period (June 12 – July 12, 2023), together with recommended response approaches. Full copies of all comments are compiled in Attachment A.
A. Comment 1: Neighboring Landowner — Particulate Matter Concerns
Commenter. This comment was submitted by an individual identified as a neighboring landowner whose residence is located east of the MEF site. Based on the description provided in the comment and the receptor analysis in the permit application, this commenter's residence is likely the nearest receptor identified in the application, situated approximately 0.42 miles (2,218 feet) east-northeast of the proposed stack location for EU-01.
Substance of Comment. The commenter expresses concern about particulate matter emissions — colloquially characterized as "dust" — from several aspects of the MEF's operations, including grain handling, fertilizer loadout activities, and truck traffic on access roads and within the facility. The commenter questions whether these particulate emissions will adversely affect air quality at nearby residences and whether the emissions will cause health impacts or nuisance conditions, particularly during periods of facility start-up and maximum production. The commenter references personal experience with dust from existing agricultural operations in the area and expresses apprehension that the MEF will significantly worsen these conditions.
Analysis. This comment raises a common and understandable concern for residents near industrial facilities. However, the technical record assembled in support of the PSD application provides a comprehensive demonstration that particulate matter emissions from the MEF will comply with all applicable air quality standards at the nearest receptor and at all off-site locations.
As noted above, the commenter's residence is likely the nearest receptor, located 0.42 miles (2,218 feet) east-northeast of the proposed stack location. The AERMOD dispersion modeling analysis demonstrates that the maximum modeled 24-hour PM₁₀ impact at this receptor location is 38.2 µg/m³. When added to the monitored background concentration of 72 µg/m³, the total concentration is 110.2 µg/m³, which is well below the 24-hour PM₁₀ NAAQS of 150 µg/m³. This leaves a compliance margin of approximately 26.5 percent. The PM₂.₅ impacts at this receptor are similarly modeled to be below the applicable annual and 24-hour NAAQS and PSD increments, as summarized in the modeling results table provided as Attachment B to this memorandum.
With respect to emission controls, the particulate matter sources that are most relevant to the commenter's concerns — grain handling, conveying, and fertilizer loadout operations — are categorized as emission unit EU-04 (material handling and storage — grain elevators, conveyors, fertilizer loadout). EU-04 is controlled by high-efficiency baghouse filters with a particulate matter outlet concentration of 0.005 grains per dry standard cubic foot ("gr/dscf") and a control efficiency of 99.5 percent. This level of control represents BACT for particulate matter from material handling operations in this industrial sector, as established through the top-down BACT analysis in the permit application. Fugitive dust emissions from unpaved internal roads and truck traffic areas are addressed through operational controls, including paving of primary haul roads, application of dust suppressants on unpaved surfaces, and speed limits for on-site vehicle traffic.
It should also be noted that Muscatine County is designated attainment for all criteria pollutants, including both PM₁₀ and PM₂.₅, under the Clean Air Act. The MEF's emissions, as modeled, will maintain the area's attainment status and will not cause or contribute to any exceedance of the NAAQS or PSD increments.
Recommended Response. We recommend preparing a written response that provides specific AERMOD modeling results for the nearest receptor location, demonstrating compliance with all NAAQS for both PM₁₀ and PM₂.₅ at the commenter's likely residence. The response should reference the BACT controls on EU-04, specifically the baghouse filters with the 0.005 gr/dscf outlet concentration and 99.5 percent control efficiency, and explain in plain language the effectiveness of these controls. The response should cite the attainment status of Muscatine County for all criteria pollutants and note that PSD increments will also be maintained. The response should be written in a tone that acknowledges the commenter's legitimate concerns about air quality and conveys GAP's commitment to operating the MEF in a manner that protects the health and well-being of neighboring residents.
B. Comment 2: Neighboring Landowner — Odor Concerns
Commenter. This comment was submitted by a second individual identified as a neighboring landowner whose residence is in the general vicinity of the MEF site. The exact location of this commenter's residence relative to the site is not specified in the comment itself.
Substance of Comment. The commenter expresses concern about potential odors from the MEF's soybean processing operations, particularly the dryer and any hexane-based solvent extraction processes, as well as from the wastewater treatment lagoon system. The commenter references prior experience with odor complaints associated with other soybean processing facilities in the region and states concern that the MEF will generate similar or worse odor conditions, particularly during warm-weather months and during nighttime temperature inversions.
Analysis. The odor concern raised by this commenter spans both the PSD air permit and the NPDES permit proceedings, as odor sources at the MEF include both air emission units (within the scope of the PSD permit) and the wastewater treatment lagoon system (addressed under the NPDES permit).
With respect to air emissions, odors from soybean processing operations are primarily associated with volatile organic compounds ("VOC"). The PSD application identifies the facility's VOC PTE at 164 tpy. The key VOC-emitting units include EU-02 (the 80 MMBtu/hr soybean dryer) and EU-03 (the fertilizer granulation dryer). Both of these units are natural gas-fired and utilize enclosed processing designs that minimize the release of fugitive VOC emissions. The use of natural gas as the combustion fuel, rather than fuel oil or other higher-emitting fuels, further reduces the potential for odor-causing emissions from these units.
If solvent extraction using hexane is part of the soybean processing operation — which is common in the industry for oil extraction — hexane emissions would be accounted for in the facility's VOC emission calculations. The PSD application's VOC inventory and controls should reflect this. However, I recommend that we confirm the specifics of the hexane extraction process and its associated emission controls with Derek Yun (GAP) and Dr. Leonard Fisk (Pinnacle Environmental) before finalizing the response to this comment.
With respect to the wastewater treatment lagoon, odor potential from lagoon systems is primarily associated with anaerobic conditions that can develop when biological oxygen demand exceeds the aeration capacity of the system. The MEF's three-cell aerated lagoon system is specifically designed to maintain aerobic conditions throughout the treatment process. The lagoon system's 4.2-acre total surface area and 18-day hydraulic retention time, combined with mechanical aeration, are intended to prevent the anaerobic conditions that are the primary cause of nuisance odors from wastewater treatment lagoons. However, the wastewater treatment system is addressed under the NPDES permit rather than the PSD air permit, and any odor-related conditions of operation for the lagoon system would more appropriately be addressed in that proceeding or through separate state regulatory mechanisms.
It should be noted that Iowa's nuisance odor provisions, including Iowa Code Chapter 657 and the Iowa Administrative Code provisions related to nuisance, are separate from and not within the scope of the PSD permitting process. The PSD permit addresses criteria pollutant and GHG emissions and the associated BACT determinations and NAAQS compliance demonstrations, but it does not directly regulate odor as a standalone parameter. Nonetheless, the facility design features and emission controls proposed in the PSD application — enclosed processing, natural gas combustion, BACT-level VOC controls — collectively serve to minimize the potential for odor impacts.
Recommended Response. We recommend preparing a written response that explains the PSD application's treatment of VOC emissions and the facility's enclosed processing design features that minimize fugitive odor emissions. The response should reference the natural gas-fired dryer systems (EU-02 and EU-03) as clean-burning and note that the facility's VOC controls are designed to minimize emissions of odor-causing compounds. The response should briefly address odor from the wastewater treatment lagoon by noting that the three-cell aerated lagoon system is designed to maintain aerobic conditions, thereby minimizing the potential for nuisance odors, and should note that the lagoon system is addressed in the NPDES permit proceeding. The response should state that Iowa's nuisance-odor framework is outside the scope of PSD permitting but that GAP is committed to good-neighbor practices and to operating the MEF in a manner that minimizes odor impacts on surrounding properties.
Before finalizing the response, we should coordinate with Derek Yun to confirm any additional odor mitigation measures that GAP is planning to implement, including any voluntary operational measures or community complaint response protocols. Any such measures can be referenced in the response to further demonstrate GAP's commitment to responsible operations. We should also confirm with Dr. Leonard Fisk and Derek Yun the details of any hexane extraction process and how hexane emissions are addressed in the VOC inventory and BACT analysis.
C. Comment 3: Heartland Environmental Alliance (HEA) — BACT Adequacy and Public Hearing Request (Air)
Commenter. Heartland Environmental Alliance ("HEA"), an Iowa unincorporated non-profit advocacy group focused on environmental policy and industrial permitting in the Midwest agricultural sector. Based on our research, HEA has participated in several prior IDNR permitting proceedings involving agricultural and industrial facilities in eastern Iowa.
Substance of Comment. HEA's comment raises two distinct issues. First, HEA questions whether the BACT analysis for NOx and PM₂.₅ is adequate, asserting that lower emission limits have been achieved at comparable facilities in other states and that the applicant failed to adequately consider selective catalytic reduction ("SCR") for NOx control on EU-01 (the 120 MMBtu/hr process heater) and EU-02 (the 80 MMBtu/hr soybean dryer). HEA contends that the applicant dismissed SCR prematurely in the top-down BACT analysis without sufficient justification and that the proposed NOx emission limit of 0.036 lb/MMBtu does not represent BACT for units of this type. Second, HEA requests that the IDNR Director convene a formal public hearing on the PSD draft permit, asserting that the complexity and potential environmental impacts of the proposed facility warrant a hearing to allow for public testimony and examination of the technical record.
Analysis — BACT.
The BACT analysis for the MEF was prepared by Dr. Leonard Fisk, P.E., of Pinnacle Environmental Consultants Inc. and follows the EPA-recommended five-step top-down methodology. We have reviewed the BACT analysis and believe it is technically sound and consistent with current regulatory practice.
NOx BACT: The application proposes low-NOx burners with flue gas recirculation ("FGR") on EU-01 (the 120 MMBtu/hr process heater) and EU-02 (the 80 MMBtu/hr soybean dryer), achieving a proposed NOx emission limit of 0.036 lb/MMBtu. In the top-down BACT analysis, Dr. Fisk evaluated all available control technologies for NOx emissions from natural gas-fired combustion units, beginning with the most stringent. SCR was identified at the top of the control technology hierarchy and was evaluated in the first step. However, based on a detailed cost-effectiveness analysis, SCR was determined not to be cost-effective for natural gas-fired combustion units of this size in the agricultural processing sector. The cost-per-ton of NOx removal for SCR on these units was calculated to significantly exceed established cost-effectiveness thresholds that have been accepted in prior BACT determinations for similar sources. Specifically, the analysis concluded that the annualized cost of SCR on EU-01 and EU-02 would result in a cost-effectiveness ratio substantially above the range of $5,000 to $10,000 per ton of NOx removed that has been considered the upper bound of cost-effectiveness for SCR on natural gas-fired units of this class in recent EPA and state permitting decisions.
Dr. Fisk's analysis included a review of the EPA RACT/BACT/LAER Clearinghouse ("RBLC") and comparable recent PSD permits for soybean processing and similar agricultural processing facilities. The review identified that the proposed NOx limit of 0.036 lb/MMBtu is consistent with or more stringent than limits imposed on recent comparable sources. The RBLC entries cited in the application include permits issued in Illinois, Minnesota, Nebraska, and Indiana for soybean processing and grain handling facilities with natural gas-fired combustion units of comparable size. None of those permits required SCR; the prevailing BACT determination for these sources is low-NOx burners with FGR.
HEA's assertion that "lower emission limits have been achieved at comparable facilities" does not cite specific permits or facilities, and our review of the RBLC does not identify any BACT determinations for comparable sources (i.e., natural gas-fired units in the agricultural processing sector of similar size) that imposed limits significantly below 0.036 lb/MMBtu without SCR, or that required SCR. If HEA is referencing permits for larger industrial boilers or units in other sectors (such as petroleum refining or power generation), those are not appropriate comparisons due to differences in unit size, fuel type, operating profile, and sector-specific economic considerations relevant to the BACT cost-effectiveness analysis.
PM₂.₅ BACT: The BACT determination for PM₂.₅ from EU-04 (grain handling and material handling) is baghouse filters with a particulate matter outlet concentration of 0.005 gr/dscf and a control efficiency of 99.5 percent. This level of control is consistent with the most stringent limits achievable with fabric filter technology and represents BACT for PM₂.₅ from material handling operations. For EU-06 (cooling towers), the BACT determination is high-efficiency drift eliminators with a drift rate of 0.0005 percent, which is the industry-standard minimum-achievable drift rate for modern cooling tower systems. The modeled PM₂.₅ impacts from the facility (87 tpy PTE) demonstrate compliance with both the 24-hour and annual PM₂.₅ NAAQS and the applicable PSD increments at all off-site receptor locations.
We are confident that the BACT analysis in the permit application is technically defensible and consistent with current regulatory precedent for comparable sources. HEA's challenge does not identify specific factual or analytical errors in the BACT analysis but instead offers generalized assertions that a more stringent result should have been reached. The written response should address HEA's assertions directly and thoroughly, with supporting data from the RBLC and comparable permits.
Analysis — Public Hearing Request.
Under Iowa Administrative Code 567—Chapter 33, the IDNR Director has discretion to hold a public hearing on a PSD draft permit if there is "significant public interest." The determination of whether significant public interest exists is a judgment call for the Director, informed by the number and nature of public comments received, the complexity and potential environmental impacts of the proposed action, and whether the issues raised can be adequately addressed through the written responsiveness summary process.
In this proceeding, a total of four (4) comments were received during the 30-day public notice period. Of these, two are from neighboring landowners raising localized concerns about particulate matter and odor, one is from the Muscatine County SWCD raising a stormwater-related concern that is more appropriately directed to the NPDES proceeding, and one is from HEA raising BACT issues and the hearing request itself. This level of comment activity does not, in our assessment, demonstrate the degree of public interest that would require the Director to exercise discretion in favor of convening a hearing. The comments are relatively limited in number and scope, and all of the substantive issues raised can be comprehensively addressed through the written responsiveness summary.
In prior IDNR PSD permitting proceedings for agricultural and industrial sources, our research indicates that public hearings have not been granted in cases where fewer than approximately ten comments were received and where the comments could be substantively addressed in the responsiveness summary. Conversely, hearings have been granted where there was substantial public opposition, organized community attendance at informational meetings, or complex contested technical issues that could not be adequately resolved through written responses. Neither of those conditions is present here.
HEA's request for a hearing does not cite specific factual disputes that would require oral testimony, cross-examination of witnesses, or any other procedural mechanism not available through the written comment and response process. The BACT issues raised by HEA are technical in nature and can be fully addressed through a detailed written response supported by the RBLC data and cost-effectiveness analysis. Granting a hearing would introduce unnecessary procedural delay — potentially four to six weeks for scheduling, hearing, and post-hearing briefing — without a corresponding benefit to the public participation process.
Recommended Response. We recommend preparing a detailed written response to HEA's BACT assertions, organized as follows:
1. Reference the five-step top-down BACT analysis methodology employed in the application, consistent with EPA guidance;
2. Present the specific RBLC data and comparable permit limits for soybean processing facilities with natural gas-fired combustion units, demonstrating that the proposed 0.036 lb/MMBtu NOx limit is consistent with or more stringent than prevailing BACT determinations;
3. Summarize the cost-effectiveness analysis for SCR, demonstrating that SCR exceeds established cost-effectiveness thresholds for units of this type and size;
4. Address the PM₂.₅ BACT determination, referencing the 0.005 gr/dscf baghouse filter performance and the 0.0005% drift rate for cooling tower drift eliminators; and
5. Present the AERMOD modeling results demonstrating compliance with all PM₂.₅ NAAQS and PSD increments.
With respect to the public hearing request, the response should note the small number and limited nature of comments received during the public notice period and explain that the written responsiveness summary process provides adequate opportunity for meaningful public participation and thorough agency review of the issues raised. The response should state GAP's position that a public hearing is not warranted and that all substantive comments can be and will be fully addressed in writing.
We should coordinate closely with Dr. Leonard Fisk of Pinnacle Environmental for technical support on the BACT rebuttal, including preparation of a summary table of RBLC entries and comparable permit determinations for attachment to the response. The target date for submission of the written responses to the four PSD air permit comments to IDNR (Jonathan Kreske, P.E.) is on or before July 28, 2023, to allow IDNR sufficient time to finalize the responsiveness summary by its anticipated August 3, 2023 date.
D. Comment 4: Muscatine County Soil & Water Conservation District (SWCD) — Stormwater Controls
Commenter. Muscatine County Soil & Water Conservation District ("SWCD"), a county-level conservation agency established under Iowa Code Chapter 161A.
Substance of Comment. The SWCD requests clarification on the adequacy of stormwater management controls for the 147-acre MEF site, with particular attention to controls for runoff from the fertilizer loadout area, which will discharge through Outfall 002 under the NPDES permit. The SWCD acknowledges in its comment that the comment was submitted during the PSD air permit comment period but that the substance of the comment relates primarily to stormwater and water quality issues. The SWCD specifically asks whether the stormwater management plan addresses potential nutrient loading from fertilizer handling areas and whether first-flush capture is incorporated into the stormwater conveyance system.
Analysis. The PSD air construction permit does not directly address stormwater discharges or stormwater management controls; those matters fall within the scope of the NPDES permit proceeding. Accordingly, this comment is somewhat procedurally misdirected, although it raises legitimate and relevant substantive concerns that should be addressed.
The Stormwater Pollution Prevention Plan ("SWPPP") prepared by Karen Ott of Pinnacle Environmental details the structural and non-structural BMPs for stormwater management at the MEF site. Structural BMPs include the following: stormwater from the fertilizer loadout pad is collected and directed through a lined detention basin designed to capture the first flush of runoff (defined as the first 0.5 inches of rainfall over the contributing drainage area). This first-flush capture system ensures that the initial, most pollutant-laden runoff is detained and treated before any discharge occurs through Outfall 002. Additional structural controls include curbed containment areas around chemical and fertilizer storage facilities, oil-water separators for truck wash wastewater, and vegetated buffer strips along the perimeter of the facility's stormwater conveyance system.
Non-structural BMPs include regular inspection and maintenance of all stormwater controls (on a quarterly basis and within 24 hours of any storm event producing 0.5 inches or more of precipitation), employee training on spill prevention and response, housekeeping protocols for the fertilizer loadout pad and truck staging areas, and record-keeping requirements for all inspections and maintenance activities.
The stormwater management plan for the site was designed by Thomas Novak, P.E., of Ridgeline Engineering Group LLC, in coordination with Pinnacle Environmental. The design incorporates site-specific hydrologic analysis and is sized to accommodate the 10-year, 24-hour design storm event for Muscatine County.
Outfall 002 will be subject to benchmark monitoring under the NPDES permit, including monitoring for total suspended solids, total phosphorus, total nitrogen, pH, and oil and grease. Benchmark monitoring results will be compared to established benchmark values, and corrective actions will be implemented if benchmark exceedances occur.
Recommended Response. We recommend preparing a written response that acknowledges the SWCD's comment and redirects the commenter to the NPDES permit proceeding, where stormwater controls are directly addressed. The response should provide a brief but informative summary of the SWPPP controls, including the fertilizer loadout pad detention basin with first-flush capture, curbed containment areas, oil-water separators, vegetated buffer strips, and the inspection and maintenance protocols. The response should note that Outfall 002 will be subject to benchmark monitoring under the NPDES permit and that GAP is committed to effective stormwater management to protect Sweetland Creek and the surrounding watershed.
We should coordinate with Karen Ott of Pinnacle Environmental and Thomas Novak, P.E., of Ridgeline Engineering Group LLC for site-specific design details to ensure that the response accurately describes the stormwater management plan. Given the SWCD's role as a county-level conservation agency, the response should be particularly thorough and respectful, as the SWCD may be a resource for GAP in ongoing community relations and conservation compliance during the construction and operational phases of the MEF.
IV. Summary and Analysis of Public Comments — NPDES Permit
This section provides a detailed summary and analysis of each of the two public comments received during the NPDES permit public notice period (June 19 – July 19, 2023), together with recommended response approaches. Full copies of all comments are compiled in Attachment A.
A. Comment 5: Heartland Environmental Alliance (HEA) — Public Hearing Request (NPDES)
Commenter. Heartland Environmental Alliance ("HEA"), the same organization that submitted Comment 3 in the PSD air permit proceeding.
Substance of Comment. HEA requests that the IDNR Director convene a formal public hearing on the NPDES draft permit. In support of this request, HEA expresses general concern about the discharge of treated process wastewater from the MEF to Sweetland Creek and questions whether the IDNR's antidegradation review was adequate. Specifically, HEA contends that IDNR should have conducted a Tier 2 antidegradation review, including an alternatives analysis, rather than limiting the review to Tier 1 (existing uses maintained). HEA asserts that a new industrial discharge to Sweetland Creek may constitute a "significant lowering of water quality" that would trigger Tier 2 review and that IDNR's preliminary determination to the contrary was insufficiently justified.
Analysis.
Antidegradation Review. The IDNR's antidegradation review for the MEF NPDES permit concluded that the proposed discharge warrants Tier 1 analysis (existing uses maintained), with a preliminary determination that no Tier 2 alternatives analysis is required. Under Iowa's antidegradation implementation procedures, codified in Iowa Administrative Code 567—Chapter 61, Tier 1 review requires a demonstration that existing uses of the receiving water will be maintained and protected. Tier 2 review — which includes an alternatives analysis, an assessment of social and economic importance, and an evaluation of whether a significant lowering of water quality will occur — is required only when the proposed activity would result in a lowering of water quality that exceeds de minimis levels and where the receiving water's quality exceeds the levels necessary to support propagation of fish, shellfish, and wildlife and recreation in and on the water.
The Tier 1 determination for the MEF discharge is appropriate for several reasons. The proposed effluent limits are specifically designed to maintain all existing and designated uses of Sweetland Creek, including its Class A1 (Primary Contact Recreation) and Class B(WW) (Warm Water Aquatic Life) classifications. The treatment system — equalization basin, DAF, three-cell aerated lagoon, and UV disinfection — produces effluent quality consistent with or better than secondary treatment standards and applicable Iowa water quality standards for each parameter. The proposed limits for BOD₅ (30/45 mg/L), TSS (30/45 mg/L), NH₃-N (3.5 mg/L seasonal / 8.0 mg/L seasonal), Total Phosphorus (1.0 mg/L), Oil & Grease (10 mg/L), and Fecal Coliform (200 CFU/100 mL) are designed to ensure that the discharge does not degrade existing water quality or impair designated uses.
Furthermore, the 0.38 MGD design flow from Outfall 001 represents a relatively modest discharge volume relative to the flow characteristics of Sweetland Creek, and mixing zone and dilution analyses performed by Pinnacle Environmental indicate that the proposed effluent limits will result in in-stream concentrations at and downstream of the point of discharge that remain within applicable water quality criteria.
IDNR's preliminary Tier 1 determination is consistent with the agency's prior practice for new industrial discharges of this type and size to receiving waters with similar use classifications. We believe the determination is well-supported by the record and defensible against HEA's challenge.
Public Hearing Request. Under Iowa Administrative Code 567—Chapter 64 (and parallel federal NPDES regulations at 40 C.F.R. § 124.12), a public hearing on a draft NPDES permit is discretionary with the IDNR Director when there is "significant public interest." Only two (2) comments were received during the entire 30-day NPDES public notice period. This level of comment activity is modest by any measure and does not demonstrate the degree of public interest that would support the exercise of the Director's discretion to convene a hearing. As with the PSD hearing request discussed in Section III.C above, the written responsiveness summary process provides an adequate and appropriate mechanism for addressing the issues raised.
HEA's hearing request does not identify specific factual disputes that would require oral testimony, live presentation of evidence, or cross-examination. The antidegradation questions raised by HEA are matters of regulatory interpretation and application that can be fully addressed through a written response referencing the applicable regulatory provisions, the technical record supporting the Tier 1 determination, and IDNR's prior practice in comparable permit proceedings.
Recommended Response. We recommend preparing a written response to HEA's comment that addresses both the antidegradation challenge and the public hearing request. On antidegradation, the response should explain the Tier 1 basis: the proposed discharge is designed to maintain all existing and designated uses of Sweetland Creek, the proposed effluent limits meet or exceed applicable water quality standards, and the multi-stage treatment system provides robust treatment ensuring high-quality effluent. The response should reference the specific proposed effluent limits (BOD₅ 30/45, TSS 30/45, NH₃-N 3.5/8.0 seasonal, TP 1.0, Oil & Grease 10, Fecal Coliform 200 CFU/100 mL) and describe the multi-stage treatment system's design and expected performance. The response should explain that IDNR's determination that Tier 2 review is not required is consistent with the Iowa antidegradation implementation procedures and with the agency's practice for comparable industrial discharges.
On the public hearing request, the response should note the limited number of comments received (two) and the nature of the issues raised, and should state GAP's position that a hearing is not warranted. This position is consistent with the recommendation on the PSD hearing request in Section III.C above, and the responses to both hearing requests should be coordinated for consistency.
The target date for submission of the written responses to the two NPDES permit comments to IDNR (Amy Lindstrom) is on or before approximately August 1, 2023, to allow IDNR sufficient time to finalize the NPDES responsiveness summary by its anticipated August 10, 2023 date.
B. Comment 6: Prairie Farmers Coalition (PFC) — Sweetland Creek Water Quality and Irrigation Concerns
Commenter. Prairie Farmers Coalition ("PFC"), identified as the Iowa Chapter of the National Farmers Union. PFC is an agricultural advocacy organization representing the interests of family farmers in Iowa. The comment is submitted on behalf of PFC's membership, which includes agricultural producers with operations along Sweetland Creek downstream of the MEF site.
Substance of Comment. PFC expresses concern about potential impacts on Sweetland Creek water quality downstream of Outfall 001, with particular focus on nutrient discharges — specifically phosphorus and nitrogen — and the potential effects on downstream agricultural irrigation water quality. PFC notes that several of its member farmers use water from Sweetland Creek for crop irrigation, particularly during the growing season (approximately April through September), and states concern that the proposed industrial discharge may introduce nutrient levels or other contaminants that would degrade the creek's suitability for agricultural irrigation use. PFC asks whether the proposed discharge will comply with applicable water quality standards at points downstream where irrigation intakes are located and whether any monitoring of the discharge's downstream effects is planned.
Analysis. PFC's comment raises a substantive and legitimate concern that can be addressed through reference to the proposed effluent limits, the receiving water's use classifications, and the antidegradation analysis.
Nutrient Limits. The proposed Total Phosphorus limit of 1.0 mg/L (monthly average) is among the more stringent limits imposed on industrial NPDES permits in Iowa and is specifically designed to protect Sweetland Creek's water quality from nutrient enrichment and eutrophication. This limit is derived from Iowa's water quality standards and reflects the nutrient criteria applicable to the receiving water's designated uses. The proposed ammonia nitrogen ("NH₃-N") limits — 3.5 mg/L during the April-through-October period and 8.0 mg/L during the November-through-March period — are seasonal limits that reflect the more stringent water quality criteria applicable during the warm-water months when aquatic organisms are most sensitive to ammonia toxicity and when irrigation use is most active.
Use Classifications and Irrigation. Sweetland Creek is classified as Class A1 (Primary Contact Recreation) and Class B(WW) (Warm Water Aquatic Life) under Iowa's water quality standards. The Class A1 classification encompasses protection of water quality for a range of beneficial uses, which includes, among others, uses such as irrigation. The water quality criteria associated with the Class A1 and Class B(WW) classifications establish the standards against which the proposed discharge is evaluated, and the proposed effluent limits are designed to ensure compliance with these criteria at the point of discharge and at all points downstream.
Antidegradation. The Tier 1 antidegradation determination ensures that existing uses of Sweetland Creek, including any current agricultural irrigation use by PFC members and other downstream users, will be maintained and protected. The Tier 1 standard requires a demonstration that the proposed discharge will not impair existing uses, and the technical analysis supporting the determination — including the proposed effluent limits, treatment system design, and receiving-water analysis — provides that demonstration.
Discharge Volume. The 0.38 MGD design flow from Outfall 001 represents a relatively modest discharge relative to Sweetland Creek's flow, particularly during the irrigation season when creek flows are typically sufficient to provide substantial dilution. The receiving-water characterization data compiled by Pinnacle Environmental (Karen Ott) includes flow data for Sweetland Creek at the proposed discharge point and at downstream locations, and the analysis confirms that the proposed effluent limits, in combination with available dilution, will result in in-stream concentrations at downstream irrigation intake points that are well within applicable water quality criteria.
Treatment System Performance. The multi-stage treatment system (equalization basin → DAF → three-cell aerated lagoon → UV disinfection) is designed to achieve consistent, high-quality effluent that meets or exceeds the proposed effluent limits. The 18-day hydraulic retention time in the aerated lagoon system provides extended biological treatment and nutrient reduction. The UV disinfection system addresses pathogen concerns, ensuring that the discharge does not introduce fecal coliform or other microbiological contaminants at levels that would impair downstream uses.
Recommended Response. We recommend preparing a written response that addresses PFC's concerns directly and comprehensively. The response should:
1. Explain the proposed nutrient limits — Total Phosphorus 1.0 mg/L and NH₃-N 3.5/8.0 mg/L seasonal — and their derivation from Iowa water quality standards designed to protect receiving waters from nutrient impairment;
2. Describe the multi-stage treatment train and its effectiveness in producing high-quality effluent that meets or exceeds the proposed limits;
3. Address the irrigation concern by referencing the Class A1 use classification of Sweetland Creek, which encompasses protection of water quality for uses including irrigation, and the Tier 1 antidegradation determination, which ensures that existing uses — including agricultural irrigation — are maintained;
4. Note the proposed NPDES permit's monitoring requirements, which will include regular monitoring of effluent quality at Outfall 001 and reporting to IDNR, providing an ongoing mechanism for verification of compliance with all effluent limits; and
5. Express GAP's willingness to engage with downstream agricultural users and the community regarding the facility's operations and environmental performance.
We should coordinate with Karen Ott of Pinnacle Environmental for receiving-water characterization data, including flow data for Sweetland Creek and downstream water quality information, to ensure that the response is supported by site-specific data. We should also coordinate with Derek Yun (GAP) regarding any community outreach efforts that GAP may undertake with downstream agricultural users, including PFC members. Any such outreach efforts can be referenced in the response as evidence of GAP's commitment to responsible operations and community engagement.
V. Consolidated Recommended Response Strategy
A. Response Priorities and Timeline
The following table summarizes the recommended timeline for preparation and submission of written responses to IDNR:
Both targeted permit issuance dates are well within the Briarwood permit milestone deadline of October 5, 2023. However, as noted in Section I, the buffer is not unlimited, and efficient management of the response process is essential to avoid any unforeseen delays.
B. Coordination with Client and Consultants
Effective preparation of the written responses will require coordination with the following individuals:
• Derek Yun, GAP Director of EHS: Mr. Yun is the primary client contact for environmental permitting matters. He should be consulted to confirm factual information regarding facility operations, odor mitigation measures, community outreach efforts, and any additional operational controls that GAP intends to implement. Mr. Yun's review of the draft responses is essential to ensure factual accuracy.
• Margaret Solberg, GAP VP of Operations / Muscatine Project Lead: Ms. Solberg is available for questions regarding facility design and operational parameters, including process details for the soybean crush and fertilizer blending operations. She may be particularly helpful in confirming details regarding the hexane extraction process referenced in Comment 2 (odor concerns).
• Dr. Leonard Fisk, P.E., Pinnacle Environmental Consultants Inc.: Dr. Fisk is the licensed professional engineer who prepared the BACT analysis and the AERMOD dispersion modeling for the PSD application. He should provide technical support for the BACT rebuttal to HEA's Comment 3, including preparation of a summary table of RBLC entries and comparable permit limits, and verification of the cost-effectiveness analysis for SCR. Dr. Fisk should also provide the detailed modeling results for the nearest receptor for inclusion in the response to Comment 1 (particulate matter concerns).
• Karen Ott, Pinnacle Environmental Consultants Inc.: Ms. Ott prepared the NPDES permit application, the wastewater treatment system design basis, and the SWPPP. She should provide technical support for the NPDES-related responses, including receiving-water characterization data for Sweetland Creek, wastewater treatment performance data and design specifications, and SWPPP details for the Outfall 002 response. Ms. Ott should also confirm the basis for the Tier 1 antidegradation determination for the response to HEA's Comment 5.
• Thomas Novak, P.E., Ridgeline Engineering Group LLC: Mr. Novak prepared the stormwater management plan for the MEF site, including the design of the detention basin and first-flush capture system for the fertilizer loadout pad. He should provide site-specific design details for inclusion in the response to SWCD's Comment 4 (stormwater controls).
C. Public Hearing Recommendation
Based on the analysis set forth in Sections III.C and IV.A above, we recommend advising IDNR that GAP does not believe a public hearing is warranted on either the PSD air permit or the NPDES permit. The reasoning supporting this recommendation is as follows:
1. Limited comment volume. Only six (6) total comments were received across both proceedings — four on the PSD air permit and two on the NPDES permit. This level of public participation, while not insignificant, does not demonstrate the "significant public interest" that would support the exercise of IDNR's discretion to convene a hearing under Iowa Administrative Code 567—Chapter 33 (air) or 567—Chapter 64 (water).
2. Adequacy of written response process. All comments received can be substantively and thoroughly addressed through written responses prepared by GAP and incorporated into the IDNR responsiveness summaries. The substantive issues raised — BACT adequacy, particulate matter impacts, odor, stormwater controls, antidegradation, nutrient limits, and irrigation concerns — are matters that lend themselves to written technical and regulatory analysis. There are no contested factual issues that require oral testimony or cross-examination to resolve.
3. Nature of HEA's hearing requests. HEA's hearing requests on both permits do not identify specific factual disputes requiring oral testimony or the procedural mechanisms available in a hearing but not in the written comment process. The requests are general in nature and, respectfully, appear to reflect a policy preference for heightened public engagement rather than a demonstration that the written process is inadequate for the issues at hand.
4. Schedule risk. While a public hearing would be unlikely, in our estimation, to push the permit issuance schedule past the October 5, 2023 Briarwood milestone deadline, it would create unnecessary schedule risk. Scheduling, conducting, and post-processing a public hearing typically adds four to six weeks to the permitting timeline. Given the financing implications of any delay, prudent risk management counsels against any course of action that could introduce unnecessary scheduling uncertainty.
If IDNR nonetheless determines that a hearing is necessary on one or both permits — a scenario we consider unlikely based on the record and IDNR's past practice — we recommend that Calderwood & Harkness prepare GAP witnesses for testimony at the hearing. The most appropriate witnesses would be Derek Yun (GAP Director of EHS) and/or Margaret Solberg (GAP VP of Operations / Muscatine Project Lead), supplemented by expert testimony from Dr. Leonard Fisk (Pinnacle Environmental, for air quality matters) and Karen Ott (Pinnacle Environmental, for water quality matters). Calderwood & Harkness should coordinate with Pinnacle Environmental to prepare direct testimony and anticipate potential cross-examination questions, particularly on the BACT analysis and antidegradation review. However, as stated, we believe this scenario is unlikely and do not recommend that significant resources be allocated to hearing preparation at this time.
D. Tone and Approach
The written responses to all six comments should adhere to the following principles regarding tone and approach:
• Technical, factual, and respectful. All responses should be grounded in the technical record and regulatory standards. The responses should demonstrate thorough regulatory analysis, cite specific data and regulatory provisions, and convey GAP's willingness to engage with legitimate community concerns in a transparent and constructive manner.
• Non-adversarial toward advocacy organizations and agricultural groups. The responses to HEA's and PFC's comments should avoid an adversarial or dismissive tone. HEA and PFC are advocacy organizations that represent constituencies with legitimate interests in environmental protection and agricultural sustainability, respectively. The responses should focus on the technical data and regulatory standards rather than on characterizing the commenters' motivations or credibility.
• Community-oriented for neighboring landowners. The responses to Comments 1 and 2 (neighboring landowners) should include references to GAP's commitment to being a responsible community member and neighbor. These responses should acknowledge the landowners' concerns as understandable and valid, describe the robust control technologies being installed at the MEF (baghouse filters, low-NOx burners, UV disinfection, aerated lagoon treatment, etc.), and convey GAP's intention to operate the facility in a manner that is protective of the surrounding community's health, safety, and quality of life.
• Consistent messaging. The responses across both permit proceedings should be consistent in factual representations, regulatory positions, and overall tone. In particular, the responses to HEA's two hearing requests (Comments 3 and 5) should present a unified position and reasoning, adapted as necessary to the specific regulatory frameworks governing each proceeding.
VI. Action Items and Next Steps
The following action items summarize the next steps required to implement the response strategy recommended in this memorandum:
1. Cynthia Ho to prepare draft written responses to the four PSD air permit comments (Comments 1–4) for Rafael Dominguez's review. Target completion: July 24, 2023.
2. Cynthia Ho to prepare draft written responses to the two NPDES permit comments (Comments 5–6) for Rafael Dominguez's review. Target completion: July 26, 2023.
3. Rafael Dominguez to circulate the PSD air permit response drafts to Derek Yun (GAP) and Dr. Leonard Fisk (Pinnacle Environmental) for factual and technical verification. Target circulation: July 24, 2023; comments returned by July 27, 2023.
4. Rafael Dominguez to circulate the NPDES permit response drafts to Derek Y

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