Full opinion text
POWERS, Justice. After a contested-case healing, the Texas Water Commission issued to Houston Chemical Services, Inc., a permit to construct and operate a commercial hazardous and nonhazardous industrial solid-waste facility. The trial court, on judicial review, affirmed the agency order authorizing the permit. The dissatisfied parties appeal to this Court. See Solid Waste Disposal Act, Tex. Health & Safety Code Ann. § 361.001-.510 (West 1992) (“Act”); Administrative Procedure Act, Act of May 4,1993, 73d Leg., R.S., ch. 268, sec. 1, §§ 2001.001-.902, 1993 Tex.Sess.Law Serv. 587, 737-54 (to be codified as Administrative Procedure Act, Tex.Gov’t Code Ann. §§ 2001.001-.902) (effective Sept. 1, 1993). We will affirm the trial-court judgment. THE CONTROVERSY Houston Chemical applied for a permit to build the facility in Harris County near the City of LaPorte. See Act § 361.003(3)-(4). Harris County, the City of LaPorte, Smith, the Honorable Mike Jackson, and others appeared in the contested case in opposition to the application. After hearing evidence and legal argument in the case, the examiner recommended in his proposal for decision that the application be denied. See APA § 2001.062. The Commission, however, approved the application, and in its final order directed issuance of the permit. Smith, Jackson, and Harris County sued the Commission in a Travis County district court as authorized by section 3,61.321 of the Act. Houston Chemical intervened to protect its interest acquired under the permit. The trial court affirmed the Commission order after trial. This appeal ensued. Smith, Jackson, Harris County, and the Commission collectively bring numerous points of error. We will discuss these points separately or jointly as their contents suggest. THE COMMISSION’S APPEAL After trial but before the district court rendered judgment, the Commission requested leave of court to amend its preceding answer by filing a third amended original answer. The new pleading would have conceded several material allegations pleaded against the validity of the agency’s final order. The Commission prayed in the new pleading that the trial court, based on these concessions, render judgment denying Houston Chemical’s application for the permit. The trial court denied leave to file the third amended original answer. See Tex.R.Civ.P. 63. In a single point of error, the Commission contends the trial court abused its discretion. See Yowell v. Piper Aircraft Corp., 703 S.W.2d 630, 634 (Tex.1986) (trial court decision whether to allow trial amendment may be overturned only upon showing abuse of discretion). Harris County makes the same contention in its points of error one and two; Smith and Jackson complain of the ruling in their point of error 458. It is readily apparent that the trial court lacked authority to render judgment denying Houston Chemical’s application — the sole relief the Commission requested in its proposed third amended original answer. The granting or denying of an application under the Act is an executive function committed exclusively to the Commission. The terms of APA § 2001.174 empower a reviewing court merely to remand a case to the agency if it reverses an agency order granting an application. See Davis v. City of Lubbock, 160 Tex. 38, 326 S.W.2d 699, 714 (1959); Short v. W.T. Carter & Bro., 133 Tex. 202, 126 S.W.2d 953, appeal dismissed, 308 U.S. 513, 60 S.Ct. 140, 84 L.Ed. 438 (1939); Daniel v. Tyrrell & Garth Inv. Co., 127 Tex. 213, 93 S.W.2d 372, 375-76 (1936). In all events, the Commission’s motion stated no grounds for the relief it requested; and the agency did not explain its failure to concede before trial the invalidity of its final order. The agency did not contend, for example, that it had acted without jurisdiction in rendering the order, and the agency does not make that contention now. Undoubtedly the Commission has a continuing duty to protect the public interest, but this duty also existed at the time the agency rendered its final order. The order is presumed to be valid in its adjudication of the public interest and Houston Chemical’s piivate interest that arose under the permit. The Commission was obliged to assert some basis for its unusual action and it has not done so, either in the trial court or in this Court. It appears to be the Commission’s position in both the trial court and this Court that the agency simply has an absolute right, as a matter of law, to obtain a reversal of its order, cancellation of the permit, and a recall of the case for no reason at all, merely by conceding the allegations attacking its order. We find no authority for that position and no legal error in the tidal court’s action. We therefore overrule the complaint that the trial court abused its discretion. See generally London v. Jean-Paid Budinger, Inc., 724 S.W.2d 931 (Tex.App.—Austin 1987, no writ); W. Wendell Hall, Revisiting Standards of Review in Civil Appeals, 24 St. Mary’s L. J. 1045, 1050-53 (1993). HEAT-SURGE VENT In them point of error “LAI,” Smith and Jackson complain the Commission violated an agency rule dealing with permit applications; Harris County raises the same complaint in its point of error sixteen. They refer to the following: Houston Chemical plans to affix a heat-surge vent to the top of a rotary kiln in which will occur the first burning of the waste materials. The vent is a safety device, designed to open on an emergency basis to relieve pressure in the rotary kiln should the pressure rise to a dangerous level. Secondly, both the Commission and the Texas Air Control Board (the latter was a party in the contested case, owing to the air-quality aspects of the proposed facility) have a rule that provides: The owner or operator must demonstrate that the facility or unit will not cause or contribute to a condition of air pollution as defined in the Texas Clean Air Act (TCAA). Such demonstration shall be based on waste characteristics, emissions estimates, and dispersion modeling and shall be submitted as parí of the permit application. 31 Tex.Admin.Code §§ 120.31, 335.367(a)(2) (1989) (emphasis added). Finally, Houston Chemical, in its application and evidence, did not treat the heat-surge vent as a distinct and separate emissions source; hence the company made no showing of waste characteristics, emissions estimates, and dispersion modeling concerning the vent as an independent item. In submitting proposed findings of fact and conclusions of law to the Commission, the Air Control Board followed suit and did not treat the heat-surge vent as an independent emissions source. See Act § 361.-073(e)-(g). In its findings, the Commission included the following ultimate fact: “Potential fugitive ail’ emissions from the opening of the heat surge vent will not pose a threat to human health or the environment.” This conclusion rests on the following rationale expressed in the Commission’s findings of underlying fact: The vent will not open except under emergency conditions; the likelihood of an emergency will be minimized by the design of the facility; the waste-feed cutoff system will activate before the build-up of pressure reaches a level sufficient to open the heat-surge vent; and a separate modeling analysis for the vent, as an independent emissions source, is unnecessary because of the limited likelihood that the emergency heat-surge valve will ever open; however, owing “to the location of the heat surge vent [behind] the secondary combustion phase of the incineration system, the occurrence and nature of fugitive emissions resulting from an opening of the heat-surge vent will be monitored.” The Commission’s permit therefore requires continuous monitoring of the heat-surge vent as well as checks at fifteen-minute intervals for any emissions that might issue from the vent. If the vent should open, the permit requires that Houston Chemical notify the Board and the Commission within twenty-four hours, and provide within fifteen days a written report of the incident. Smith, Jackson, and Harris County view as immaterial the Commission’s foregoing justification regarding the heat-surge vent. They reason that Commission rule 335.367(a)(2) required three things: (1) that Houston Chemical demonstrate that the heat-surge vent “will not cause or contribute to a condition of air pollution”; (2) that any demonstration in that regard must “be based on waste characteristics, emissions estimates, and dispersion modeling” and no other basis is sufficient for the purpose; and (3) that the demonstration must “be submitted as part of the permit application.” We hold there was no prejudicial error. Under the Commission’s rule 335.367(a)(2) and the Air Control Board’s rule 120.31, the operator “must demonstrate that the facility or unit will not cause or contribute to” air pollution, (emphasis added). The emphasized words are defined in a way that includes equipment components such as a heat-surge valve, indicating that the requisite demonstration may be made for the facility or unit as a whole and not necessarily for each equipment component. See Act § 361.-003(39). More importantly, we believe the Commission was, in all events, free to depart from a strict adherence to what Rule 335.367(a)(2) required. The rule consists of two parts. The first sentence imposes a requirement of substance: “The owner or operator must demonstrate that the facility or unit will not cause or contribute to a condition of air pollution.” The second sentence imposes a procedural requirement for meeting this substantive requirement: “[s]uch demonstration must be based on waste characteristics, emissions estimates, and dispersion modeling ... submitted as part of the permit application.” It is readily apparent from the face and context of the rule that the second sentence was not intended primarily to confer procedural benefits upon a party to the case; rather, it was manifestly intended as a procedural aid to facilitate the Commission’s decision-making as to the first or substantive element of the rule. The Commission and the Air Control Board were therefore free to relax the “law” embodied in the second sentence and their doing so is “not reviewable except upon a showing of substantial prejudice to the complaining party.” American Farm Lines v. Black Ball Freight Serv., 397 U.S. 532, 539, 90 S.Ct. 1288, 1292, 25 L.Ed.2d 547 (1970) (citation omitted); Peter Raven-Hansen, Regulatory Estoppel: When Agencies Break their Own “Laivs, ” 64 Tex.L.Rev. 1, 23 (1985); see also Morgan Express, Inc. v. Railroad Comm’n of Texas, 749 S.W.2d 134, 141 (Tex.App.—Austin 1987, writ denied). It does not appear that any prejudice resulted from the Commission’s chosen course of proceeding in the case. We overrule the points of error. FINANCIAL ASSURANCE Harris County, in its points of error three and four, and Smith and Jackson, in their point of error “I.A.2,” complain that the Commission made errors of law in connection with the financial assurance that the Commission required of Houston Chemical to secure its operation and closure of the facility according to law. We have set out the relevant parts of the Act in a footnote. The Commission has by rule adopted certain federal regulations pertaining to financial assurance, unless these are clearly inconsistent with the Act. 12 Tex.Reg. 1353 (proposed) and 12 Tex.Reg. 2106 (1987) (adopted), amended in part, 16 Tex.Reg. 5056 (proposed) and 16 Tex.Reg. 6936 (1991) (adopted) (former 31 Tex.Admin.Code § 335.152(a)(6)). The federal regulations are found in 40 C.F.R. §§ 264.140-.169 (1992). They provide that the owner or operator of a facility must maintain a detailed written estimate of the cost of closing the facility and give “financial assurance” that he will close the facility in accordance with the law. 40 C.F.R. §§ 264.142(a); § 276.143 (1992). In giving such assurance, the operator “must choose from” the following options: closure trust fund; surety bond guaranteeing payment into a closure trust fund; surety bond guaranteeing performance of closure; closure letter of credit; closure insurance; financial test and corporate guarantee for closure; use of “multiple financial mechanisms”; or use of a financial mechanism for multiple facilities. 40 C.F.R. § 264.143 (1992). Similar assurance is required for the post-closure care of the site. 40 C.F.R. §§ 264.144-.145 (1992). A closure-cost estimate, upon which such assurance is based, must be adjusted annually and submitted to the agency. 40 C.F.R. § 264.142(b) (1992). The federal regulations also require “financial assurance” regarding the owner’s or operator’s potential liability to third parties during the course of operations. This assurance may be provided in the form of liability insurance, a financial test, a corporate guarantee, or a combination of a corporate guarantee and insurance. The coverage must include bodily injury and property damage to third parties caused by sudden accidental occurrences arising from operations of the facility, in the amount of at least $1 million per occurrence with an annual aggregate of at least $2 million, exclusive of legal defense costs. 40 C.F.R. § 264.147(a) (1992). The coverage must also include “bodily injury and property damage to third parties caused by nonsudden accidental occurrences arising from operations of the facility ... in the amount of at least $3 million per occurrence with an annual aggregate of at least $6 million, exclusive of legal defense costs.” 40 C.F.R. § 264.147(b) (1992) (emphasis added). The amounts mandated by these rules may be reduced, however, if the owner or operator demonstrates they “are not consistent with the degree and duration of risk associated with” the operations, a request in that regard being “treated as a request for a permit modification.” 40 C.F.R. § 264.147(c) (1992). Similarly, the agency may adjust the required amount upward “as may be necessary to protect human health and the environment.” 40 C.F.R. § 264.147(d) (1992). In its final order, the Commission determined as follows: 1. Houston Chemical “will meet state and federal financial assurance requirements for facility closure through the use of a closure trust fund as provided in 40 C.F.R. § 264.143(a).” 2. Houston Chemical’s permit requires that before receipt of any wastes the Company must fully fund the closure trust fund in the amount of $8,091,980. 3. Houston Chemical “will maintain liability coverage for sudden accidental occurrences in the amount of at least $1,000,000 per occurrence with an annual aggregate amount of at least $2,000,000, exclusive of legal defense costs, as required by the permit and as provided in 40 C.F.R. § 264.147.” The permit itself provides as follows: 1. Houston Chemical may not begin operations until it is in compliance “with all financial assurance requirements and liability requirements, to include all related [instruments] being in full force and effect”; and continued operation of the facility is contingent upon maintenance of financial assurance under the federal regulations described above. Houston Chemical “shall provide financial assurance for closure in a form acceptable to the Executive Director in an amount not less than $8,091,980 (representing 1988 dollars). If a closure trust fund is utilized, the permit-tee shall fully fund the closure trust prior to accepting wastes for storage and/or processing at the site.” 2. 3. “The permittee shall submit to the Executive Director upon written request such information as may be necessary to determine the adequacy of financial assurance.” Harris County, Smith, and Jackson complain first that the trust-fund assurance required of Houston Chemical does not cover operation of the facility, but only the cost of its closure. This complaint appears to rest upon a misinterpretation of section 361.085 of the Act. Subsection (a) of that statute requires that the applicant demonstrate “sufficient financial resources to operate the facility in a safe manner and in compliance with the permit and all applicable rules, including how [the] applicant intends to obtain financing for construction of the facility, and to close the facility in accordance with applicable rules.” Act § 361.085(a) (emphasis added). Subsection (d) requires execution of “the required financial assurance conditioned on the permit holder’s satisfactorily operating and closing the solid waste facility.” Act § 361.085(d) (emphasis added). Thus, section 361.085 of the Act distinguishes between assurances as to the cost of closing the facility and as to operation of the facility in a safe manner. This is the identical distinction made in the federal regulations that the Commission has adopted as its own. It appeal's to us that the Commission has clearly authorized (1) the trust fund to assure against the cost of closing the facility and (2) liability insurance to assure against claims arising from operation of the facility. We reject the contrary contention that section 361.085 of the Act requires a single form of assurance encompassing both closure costs and operations liability. If Harris County, Smith, and Jackson intend that assurance for safe operation of the facility means something different from assurance against third-party liability (and this is not apparent from their brief), then we should point out that the closure-cost estimate, upon which financial assurance is based, “must equal the cost of final closure at the point in the facility’s active life when the extent and manner of its operation, would make closure the most expensive!.]” 40 C.F.R. § 264.142(a)(1) (1992) (emphasis added). In other words, the manner of operation is a factor that must be used in calculating the closure-cost estimate, and the amount of assurance that must be given against such cost. Harris County, Smith and Jackson complain next that the Commission made no findings demonstrating the “degree and duration of risks associated with” the waste-management activities, as stated in section 361.085(f) of the Act. We have outlined above the Commission’s determinations relative to financial assurance. It is evident to us that the Commission set the amount of the trust fund and liability insurance at the standard levels established in the federal regulations the Commission adopted, relying upon the mechanism provided in those regulations for periodically increasing the amounts should the “degree and duration of risks” require. These regulation-based amounts are independent of the risks associated with any particular facility. We see no error in this method of complying with section 361.-085(f) of the Act in the case of a new facility. Harris County, Smith, and Jackson complain that the Commission accepted the standard amounts for liability insurance, as established in 40 C.F.R. § 264.147(a), a regulation the Commission adopted. The regulation requires “at least $1 million per occurrence with an annual aggregate of at least $2 million, exclusive of legal defense costs.” Id. (emphasis added). Harris County, Smith, and Jackson argue that actual third-party liability claims may exceed the amounts indicated; hence Houston Chemical was bound to demonstrate and the Commission was bound to determine in advance the probable amount of such future claims and calculate therefrom the required amount of liability insurance thereon. We believe it lay within the Commission’s discretion to interpret differently section 361.085 of the Act. The agency has interpreted the Act as authorizing its employment of the system established in 40 C.F.R. § 264.147(a), coupled with the provision in subsection (d) of that regulation which authorizes the agency to adjust the standard level of insurance as “necessary to protect human health and the environment,” based on the agency’s periodic “assessment of the degree and duration of risk associated with the ownership or operation of the facility.” 40 C.F.R. § 264.147(d) (1992). We see nothing unreasonable in the Commission’s interpretation of this part of the Act. See Stanford v. Butler, 142 Tex. 692, 181 S.W.2d 269, 273 (1944) (noting that courts ordinarily adopt and uphold an administrator’s construction of a statute, provided the construction is reasonable). Harris County, Smith, and Jackson complain finally that the Commission has yet to determine “the type or types of financial assurance” required of Houston Chemical under section 361.085(a) of the Act; hence the agency order is not final and the trial court should have sustained their motion to dismiss their lawsuit for want of jurisdiction. They base this contention on the following statements made in the permit after it fixed the amount of financial assurance required of Houston Chemical: 1. “If a closure trust fund is utilized, the permittee shall fully fund the closure trust” before accepting wastes, (emphasis added). 2. Houston Chemical “shall provide financial assurance for closure in a form acceptable to the Executive Director” of the Commission, (emphasis added). In appellants’ view, the conditional sense of these statements, indicated by the emphasized words, implies that the Commission itself never determined the type or types of financial assurance required of Houston Chemical, but left that decision to the agency’s executive director. We reject this interpretation of the permit. The permit purported to fix the rights of the parties under the general rules that applied to such permits. See Sunset Express, Inc. v. Gulf, C. & S.F. Ry., 154 S.W.2d 860, 862 (Tex.Civ.App.— Fort Worth 1941, writ ref d w.o.m.). And we believe the terms of the permit must be construed in context, especially in light of the Commission’s decision and order evidenced by the permit. We believe it obvious that the Commission’s decision and final order plainly required utilization of a trust fund; hence the executive director’s discretion was limited accordingly. The permit language quoted above must be understood as giving the executive director discretion as to the form of the trust fund tendered in satisfaction of what the final order required. His discretion did not extend, in other words, to choosing from among the types of financial assurance authorized in 40 C.F.R. § 264.143. We believe any other construction is artificial and unreasonable. For the reasons given, we overrule the points of error urged by Harris County, Smith, and Jackson concerning the matter of financial assurance. DESIGN AND ENGINEERING Smith and Jackson, in their point of error “I.A.3,” and Harris County in its points of error six and thirteen, complain that the Commission made errors of law in connection with the design and engineering aspects of the facility proposed in the Houston Chemical application. A Commission rule provides as follows: Unless otherwise stated, an application for a permit to store, process, or dispose of solid waste shall meet the following requirements. (2) Plans and specifications for the construction and operation of the facility ... shall be submitted_ The information provided shall be sufficiently detailed and complete to allow the executive director to ascertain whether the facility will be constructed and operated in compliance with all pertinent state and local air, water, public health, and solid waste statutes. (7) Engineering plans and specifications submitted as part of the permit application shall be prepared and sealed by a registered professional engineer who is currently registered as required by the Texas Engineering Practice Act. 31 Tex.Admin.Code § 305.50(2), (7) (Supp. 1993). The Commission found: (1) “[s]uffi-cient detail of design has been provided in the application and during the evidentiary hearing to determine that the proposed incineration system is capable of functioning as represented by the applicant and as required in the permit”; (2) “[t]he plans and specifications are sufficiently detailed and complete to ascertain whether the facility will be constructed and operated in compliance with all pertinent state and federal air, water, public health and solid waste standards.” Harris County, Smith, and Jackson complain the findings are erroneous because (1) the plans furnished by Houston Chemical, with its application, are not “construction plans”; indeed, at least one is marked “Not for Construction”; and (2) the plans accompanying the application were not prepared by and do not bear the seal of a professional engineer, as required by the rule quoted above. We have examined the application. Twenty-three documents forming a part of the application are large drawings that pertain to the construction of the facility. We believe these are the documents in question. Two are marked “Not for Construction.” One of these is entitled “Proposal Drawing: Rotary Kiln Incineration System,” the other “Proposal Drawing: Mise. Elev. & Sections, Rotary Kiln Incineration System.” Each drawing bears what purports to be the seal of a registered engineer, contrary to appellants’ claim that they do not bear such a seal. What then of appellants’ complaint that the plans are not sufficiently detailed and complete to meet what rule 305.50(2), (7) requires? Implicit in appellants’ argument is a premise that subsections (2) and (7) of rule 305.50 require that construction plans have the specificity and certainty such plans ordinarily have outside the permit process, as when an owner and builder contract for the erection of a structure in accordance with an agreed set of plans, each having a contract right of performance according to the agreed plans. Since two of the plans are marked “Not for Construction” in this instance, they were therefore insufficient in appellants’ view to meet what the rule requires. In other words, the sufficiency of the plans depends entirely upon the meaning appellants have first assigned to subsections (2) and (7) of rule 305.50. We believe the Commission was free to assign a different meaning. The rule explicitly requires that the construction plans provide information “sufficiently detailed and complete to allow the executive director to ascertain lohether the facility ivill be constructed and operated in compliance ivith all pertinent ” statutes. 31 Tex.Admin.Code § 305.50(2) (Supp.1993) (emphasis added). The Commission is expected to assign meaning to its rules. We see nothing unreasonable in the meaning implicitly assigned by the Commission in this instance — that the plans must be sufficient for the regulatory purpose indicated even though they may not be sufficient for judging compliance with any contract under which the structures would be built. We may not say this is an unreasonable construction, whether the rules be viewed as “procedural,” “interpretative,” or “legislative.” See United States v. Larionoff, 431 U.S. 864, 872, 97 S.Ct. 2150, 2155, 53 L.Ed.2d 48 (1977); Bullock v. Hewlett-Packard Co., 628 S.W.2d 754 (Tex.1982); Railroad Comm’n of Texas v. Shell Oil Co., 139 Tex. 66, 161 S.W.2d 1022, 1027-28 (1942). The result is not altered, in our view, by the terms of the Texas Engineering Practice Act as urged by the appellants. Section 15(c) of that statute, upon which appellants rely, provides as follows: A public official of this state ... charged-with the enforcement of laws, ordinances, codes, or regulations that affect the practice of engineering may only accept plans, specifications, and other related documents prepared by registered engineers, as evidenced by the seal of the engineer. Tex.Rev.Civ.Stat.Ann. art. 3271a, § 15(c) (West Supp.1994) (emphasis added). As mentioned previously, all the drawings do bear the seal of a registered engineer. Nothing in subsection 15(c) of the statute directs that a public official of this state may only accept construction plans that are sufficiently certain to create a contract right of construction performance in accordance therewith; nothing in the statute forbids the acceptance of preliminary plans, for example, or plans offered for another purpose, such as regulation in this instance. The subsection is, instead, part of a section that deals with the registration, certification, and seals of professional engineers. Moreover, we doubt the word “accept,” as used in subsection 15(c), was intended to have the meaning appellants implicitly impute to it — that the Commission “accepts” the plans in the contract sense of creating rights and obligations with their acceptance. Under the regulatory scheme, the plans, specifications, and related documents submitted with the permit application are essentially conditional and tentative and only for the purpose of initiating the application process. Even a resulting permit, when issued, creates no privilege or property right. It is subject to further Commission orders imposed unilaterally by the agency. An engineer’s certification that the building complies with such permit and subsequent orders is an event that must take place after construction and a test of the structures by a “trial burn.” See 31 Tex.Admin.Code § 305.122 (1989); 11 Tex.Reg. 272 (proposed) and 11 Tex.Reg. 2597 (1986) (adopted), amended in part, 15 Tex.Reg. 4793 (proposed) and 15 Tex.Reg. 6017 (1990) (adopted) (former 31 Tex.Admin.Code § 305.-144); 11 Tex.Reg. 276 (proposed) and 11 Tex.Reg. 2600 (1986) (adopted), amended in part, 15 Tex.Reg. 4794 (proposed) and 15 Tex.Reg. 6017 (1990) (adopted) (former 31 Tex.Admin.Code § 305.172). We overrule the points of error. RECOMMENDATIONS OF THE AIR CONTROL BOARD Harris County, in its point of error ten, and Smith and Jackson, in their point of error “I.A.4,” complain the Commission made an error of law in reaching its final decision without a valid recommendation of the Texas Air Control Board. We should explain. When the Commission receives an application for a permit to construct and operate a facility for the disposal of industrial solid waste and hazardous municipal waste, “the Texas Air Control Board shall perform a technical review of the air quality aspects of’ the application. Act § 361.073(a); see also Act § 361.072. On completing its technical review, the Board furnishes its recommendations or proposed permit provisions to the Commission, and the Commission “shall incorporate into its proposed action all recommendations or proposed permit provisions” furnished by the Board, unless these are less stringent than certain federal requirements. Act § 361.073(e), (d). Should the “Board’s proposed permit provisions conflict with provisions proposed by the [Commission] staff, the staffs of the Board” and the Commission “shall attempt to resolve the conflict before the [Commission’s] technical review of the application ends.” Act § 361.073(d). The Board’s rules and the Commission’s rules also establish this procedure. See 31 Tex.Admin.Code § 120.15(a) (Supp.1993) & § 335.365(a) (1989). The Board, in making its technical review and proposals, acts neither as a tribunal nor as a mere advisor; rather, the Board is a party in the permit proceeding before the Commission. “If a contested case hearing is held, the ... Board shall develop and present the state’s evidence and testimony concerning the air quality aspects of the application,” and the Commission as a party and any other party “is entitled to cross-examine any testifying witness” fi’om whom evidence is adduced by the Board. Act § 361.073(e). At the conclusion of the evidence, the Board must be allowed thirty days in which to submit its proposed findings of fact and conclusions of law, together with “permit language,” to the Commission. Act § 361.-073(f). The Commission and its hearing examiner “must accept the information submitted by the ... Board unless the [Commis-' sion] finds the recommendations of the ... Board are not supported by a preponderance of the evidence.” Act § 361.073(g). Finally, the “Board may seek judicial review of the air quality aspects of the” Commission’s decision in the case. Act § 361.073(h). Harris County, Smith, and Jackson complain the Commission committed legal error when it based its final decision on recommendations made by the staff of the Air Control Board as opposed to recommendations made by the Board itself. The recommendations were enclosed with a letter signed by “Priscilla J. Falzone, Staff Attorney, Legal Division.” The letter is written on Board stationery, headed “Texas Air Control Board,” listing the Board chairman, vice-chairman, members, and executive director. The letter begins: Enclosed for filing in the above referenced matter are the Texas Air Control Board Staff’s (TACB Staff) Proposed Findings of Fact and Conclusions of Law regarding the air quality aspects of the subject appli-cation_ Copies of the Proposed Findings of Fact and Conclusions of Law are being mailed to the other parties, (emphasis added). Harris County, Smith, and Jackson argue that the Board itself never made a recommendation to the Commission because the letter states, on its face, that the recommendations were those of the Board’s staff; hence they could not have come from the Board or its executive director, the only authorities in whom the Act vests the power of making recommendations to the Commission. We reject the theory. Section 361.075 of the Act provides “[t]he Texas Air Control Board may delegate to its executive director the powers and duties conferred on the board under [section 361.073],” the statute that requires the Commission to incorporate in its decisions the recommendations “submitted by the Texas Air Control Board.” Section 361.075 does not refer to any specific power or duty the Board might delegate to its executive director. Nor does any statute, so far as we are able to find, prohibit the Board or the executive director from acting through other agency employees. In the case of a large agency like the Board, exei’cising statutory powers in its own technical field, it would be surprising if a court did not hold that the agency’s statutory framework necessarily, if implicitly, empowers the Board and executive director to delegate further, under them ultimate control, even dis cretionary powers of a limited nature. See Lipsey v. Texas Dept, of Health, 727 S.W.2d 61, 64-65 (Tex.App.—Austin 1987, writ ref'd n.r.e.). But that issue is not before us. Instead, we have simply a complaint that the recommendations were not an act of the Board or its executive director because their attorney’s letter, amounting to a pleading in a contested case, described the recommendations as being those of the Board “staff.” We cannot presume the attorney or the staff acted without authority given or ratified by the Board or the executive director. The attorney and the staff had at least apparent authority and they purported to act as Board employees and as Board attorney. The Board itself has not challenged their authority to act as they did. The power to engage employees and attorneys is implicit in the Board’s statutory framework. See Texas Clean Air Act, Tex.Health & Safety Code Ann. § 382.002 & § 382.011 (West 1992); Terrell v. Sparks, 104 Tex. 191, 135 S.W. 519, 521-22 (1911). In these circumstances, we believe the ordinary presumption attaches to the acts of the staff and the attorney — a presumption of regularity in official acts. See In re Laughlin, 153 Tex. 183, 265 S.W.2d 805, 808, appeal dismissed, 348 U.S. 859, 75 S.Ct. 84, 99 L.Ed. 677 (1954); Dillehay v. Texas Life Ins. Co., 130 Tex. 197, 107 S.W.2d 369, 370 (1937). The presumption is rebutta-ble, of course, but no party has contended that the attorney and staff acted without actual authority; certainly no party has introduced evidence to that effect. The presumption stands unassailed. We overrule the points of error. COMMISSIONER’S COMMENT Smith and Jackson contend, in their point of error “I.A.5” that the Commission committed legal error by substituting a post-permit “trial-burn” procedure for a determination the agency was obliged to make before issuing the permit. A federal rule adopted by the Commission requires the limited operation of a facility, a “trial burn,” after construction is completed. The purpose of the trial burn is to ascertain whether the facility will actually operate as contemplated during the permitting process. See 40 C.F.R. § 270.62. In the meeting in which the Commission approved Houston Chemical’s application, one commissioner stated: You know, I really feel this has been a real difficult case. This is something that, you know, has been bothering me since when I was in the legislature as far as the hazardous waste for a while, and I’ve got, you know, a lot of thoughts about this, and I’m, you know — the only way I, as a layman, can figure out if this thing is going to work is to do it and go through a trial burn. From this comment, Smith and Jackson extract an inference that “the Commission abdicated a careful pre-permit analysis of the proposed scheme and improperly rationalized that the tidal burn was the only standard against which the facility needed to be measured.” We disagree with the inference. It is unnatural and without foundation in the record. The record indicates without question the pre-permit analysis made by the Commission as a party, and the numerous findings of fact and conclusions of law indicate that the Commission as a tribunal performed its duty in determining the case based on the relevant law and the evidence, all before issuance of the permit. The substance of the statement quoted above amounts simply to an expression by one Commissioner regarding the difficulty of the case and the uncertainty inherent in all estimates and predictions about future events. The second sentence of the quotation indicates the importance of the trial burn. Nothing in the quotation indicates to a reasoning mind a substitution of the trial burn for the statutory and rule-based criteria by which permits are issued under the Act. In all events, “[t]he thought processes or motivations of an administrator are irrelevant in the judicial determination whether the agency order is reasonably sustained by appropriate findings and conclusions that have support in the evidence.” City of Frisco v. Texas Water Rights Comm’n, 579 S.W.2d 66, 72 (Tex.Civ.App.—Austin 1979, writ refd n.r.e.); see also United States v. Morgan, 313 U.S. 409, 61 S.Ct. 999, 85 L.Ed. 1429 (1941). The Commission’s final decision purports to rest solely on the findings of fact and conclusions of law that accompany the decision. We must judge the validity of the decision according to the basis upon which it purports to rest. Professional Mobile Home Transp. v. Railroad Comm’n of Texas, 733 S.W.2d 892, 904 (Tex.App.—Austin 1987, writ refd n.r.e.). We therefore overrule the point of error. FLOOD-PLAIN ELEMENT In their point of error IV.A.6, Smith and Jackson contend the Commission committed legal error with respect to a small part of the facility premises that might fall within a 100-year flood plain. Section 361.104 of the Act directs the Commission as follows: The commission by rule shall prohibit the issuance of a permit for a new hazardous waste management facility ... if the facility is to be located in an area determined to be unsuitable under rules adopted by the commission under Section 361.103 unless the'design, construction, and operational features of the facility will prevent adverse effects from unsuitable site characteristics. (emphasis added). Section 361.103 directs that the Commission shall by rule “define the characteristics that make [certain] areas unsuitable for a hazardous waste management facility.” (emphasis added). The rule must include consideration of the following factors: “(1) flood hazards; (2) discharge from or recharge to a groundwater aquifer; (3) soil conditions; (4) areas of direct drainage within one mile of a lake used to supply public drinking water; (5) active geological processes; (6) coastal high hazard areas, such as areas subject to hurricane storm surge and shoreline erosion; or (7) critical habitat of endangered species.” Act § 361.103(l)-(7). Accordingly, a Commission rule elaborates upon the foregoing in detail. The rule includes the following provision: A storage or processing facility ... may not be located in the 100-year flood-plain unless it is designed, constructed, operated, and maintained to prevent washout of any hazardous waste by a 100-year flood. 11 Tex.Reg. 450 (proposed) and 11 Tex.Reg. 2347 (1986) (adopted), amended in part, 16 Tex.Reg. 4220 (proposed) and 16 Tex.Reg. 6070 (1991) (adopted) (former 31 Tex.Admin.Code § 335.204). Another Commission rule provides: The commission shall not issue a permit for a new hazardous waste management facility ... if the facility ... does not meet the requirements of § 334.204 of this title (relating to Unsuitable Site Characteristics.) If we understand the evidence correctly, the 100-year flood-plain boundary corresponds, in the vicinity, to the seventeen-foot contour above mean sea level. All of Houston Chemical’s tract is above the contour except for a drainage ditch. The ditch runs parallel to the southern property line and drains to the west. The ditch traces a path between the southern property line and a security fence to be erected about thirty-five feet from that line. The fence will be six feet in height, made of chain link and multiple strands of barbed wire on top. The fence will enclose all operating parts of the facility. About forty feet inside the fence will be a rail line and a “Railcar Unloading Facility,” the rail line being basically parallel to the fence. The rail line crosses the drainage ditch at a point on the southeast corner where the line leaves the tract. The Commission found as follows: The proposed facility will be designed, constructed, operated and maintained to prevent the washout of any hazardous waste by a 100-year flood event. (1) No waste management units ... will be located in the 100-year floodplain. (2) Permit Provision II.B.29 has been modified to preclude utilization of the proposed Railcar Unloading Area by providing: “Notwithstanding all permit provisions to the contrary, the Railcar Unloading Area at this facility is specifically prohibited from use unless the permittee submits evidence as part of a major permit amendment which indicates the subject area is either out of the 100-year floodplain or can be protected from washout by a 100-year flood.” Secondary containment at the facility, as well as the design, construction and operational features of the facility, will preclude migration to surface water of any waste from spills, leaks or discharges. The proposed facility will meet the federal locational standards for hazardous waste management facilities incorporated into 31 TAC § 335.152(a)(1). The proposed facility will be designed, constructed, operated and maintained to prevent the washout of any hazardous waste by a 100-year flood event. (emphasis in original). From these fact findings, the Commission concluded: The site selected for the facility, when evaluated in light of proposed design, construction, and operational features, including secondary containment, will prevent adverse effects from any unsuitable site characteristics and will reasonably minimize possible contamination of surface water and groundwater and otherwise complies with applicable siting criteria. Smith _ and Jackson contend Houston Chemical “never made any showing that its proposed facility incorporated special design, construction or operational features that would guard against flooding at its site.” This contention is incorrect. The site plan demonstrates that no operational equipment or activities will be situated within the drainage ditch, evidently the only part of the tract that lies within the 100-year flood plain. Indeed, the ditch lies outside the security fence so as to separate it from the operating parts of the facility. Additionally, the plan is replete with various dykes as a protection even above the seventeen-foot contour. The evidence was uncertain about where the seventeen-foot contour line existed, on the ground, near the Railcar Unloading Facility; consequently the agency order forbade its use until the location of the contour line was established with certainty in that part of the tract. We overrule the point of error. FORMER COMMISSION EMPLOYEE’S PARTICIPATION IN THE CONTESTED CASE Harris County, in its point of error five, and Smith and Jackson, in their point of error “I.A.7,” complain the Commission committed an error of law by allowing its former executive director to participate in the contested case as counsel for Houston Chemical. Mr. Larry Soward began serving as executive director for the Commission on September 1, 1985. On August 26, 1986, Houston Chemical filed its application for the permit we now review. The Commission staff did not complete its technical review within the 120 days required by agency rule. See 31 Tex.Admin.Code § 281.19(a) (1989). The staff requested that the executive director, Mr. Soward, allow an extension of time to perform the review. See 31 Tex.Admin.Code § 281.20 (1989). The request was granted, evidently by Mr. Soward. We cannot find in the record any documentation for the foregoing; it is taken from the 1989 testimony given in the contested case by a Commission employee. The testimony does not indicate that anyone opposed the extension of time. The event must have occurred in late 1986, or a date well before August 27, 1988, when notice of the application was first published. The event also occurred before the application was forwarded to the Commission itself for filing, setting, and the giving of notice to persons who might be affected. See 31 Tex.Admin.Code § 281.22(a) (1989). In other words, the extension was given, in all likelihood, before the case had become contested. Mr. Soward left the Commission’s employment December 4, 1987. He was subsequently retained as counsel by Houston Chemical. In 1990, the legislature amended the Act by adding section 361.0885 which provides: (a) After providing an opportunity for a hearing to an applicant, the [Commission] shall deny an application for the issuance ... of a permit within its jurisdiction and may not issue ... the permit if the [Commission] determines that a former employee: (1) participated personally and substantially as a former employee in the [Commission’s] review, evaluation, or processing of that application before leaving employment with the [Commission]; and (2) after leaving employment with the [Commission], provided assistance on the same application for the issuance ... of a permit, including assistance with preparation or presentation of the application or legal representation of the applicant. Act § 361.0885 (emphasis added). The amendment became effective September 6, 1990, or about twenty months after Mr. So-ward left the Commission’s employment. We believe the Commission did not err in concluding that the application had been properly processed, even assuming the statute applied retroactively to the case. The agency could, in our view, reasonably conclude that Mr. Soward’s participation was neither personal nor substantial in the sense of the statute. Harris County, Smith, and Jackson argue to the contrary on two grounds. They argue that merely holding the office of executive director amounts to participating in the case “personally and substantially.” We disagree with this interpretation of section 361.0885. Under that theory, the words “personally and substantially” are drained of any actual meaning; the provision for a hearing would be superfluous for the disqualification would be absolute and categorical; and there is no indication in the statute that the legislature intended to make distinctions based upon a former employee’s official position. Harris County, Smith, and Jackson argue alternatively that granting the staff its requested extension of time was a personal and substantial participation in the case as a matter of fact. We disagree, as indicated above. The participation was no doubt personal, but the Commission could reasonably conclude it was not substantial in the circumstances indicated. We overrule the point of error. FAILURE TO MAKE REQUIRED FINDINGS In their point of error “I.B.l,” Smith and Jackson contend the Commission erred in issuing the permit when the agency had not made findings on all requisite statutory criteria. Section 361.109(a)(1) of the Act provides “[t]he commission may grant an application for a permit ... for a hazardous waste management facility if it finds that ... the applicant has provided for the proper operation of the proposed hazardous waste management facility.” This statutory provision thus calls for an ultimate conclusion by the agency. The agency order contains the substance of this ultimate conclusion, expressed as conclusions of law. For example, conclusion of law number seven states: “The proposed incinerator and associated facilities have been designed and will be constructed, operated, and maintained in accordance with applicable Commission and [Texas Air Control Board] regulations.” Similar determinations are expressed as conclusions of law with respect to all aspects of the proposed facility. Section 361.023 of the Act sets out the legislative objectives and related public policy regarding hazardous waste by providing: (a) To protect the public health and environment, it is the state’s goal, through source reduction, to eliminate the generation of hazardous waste to the maximum extent that is technologically and economically feasible. Therefore, it is the state’s public policy that, in generating, treating, storing, and disposing of hazardous waste, the following methods are preferred to the extent economically and technologically feasible, in the order listed: (1) source reduction; (2) reuse or recycling of waste, or both; (3) treatment to destroy hazardous characteristics; (4) treatment to reduce hazardous characteristics; (5) underground injection; and (6) land disposal. (b) Under Subsection (a)(3), on-site destruction is preferred, but it shall be evaluated in the context of other relevant factors such as transportation hazard, distribution of risk, quality of destruction, operator capability, and site suitability. Smith and Jackson argue the Commission’s final order does not contain “any findings regarding the economic and technological feasibility of alternative methods of waste treatment and disposal of higher preference than incineration under State law”; and does not contain findings that pertain to the various factors listed in subsection (b) of the statute. We observe that the legislature has required that these objectives and considerations be effectuated generally, and left to the Commission’s discretion the particulars of how to effectuate them. There is, for example, no statutory requirement that the various factors must be determined before a permit may issue in any contested case. Moreover, it does not appear that a dispute existed between the parties with regard to any of the factors listed in subsections (a) and (b) of the statute. The function of agency fact findings is to resolve factual disputes. In the absence of a factual dispute about the indicated factors, we do not see how the Commission can logically be faulted for failing to make fact findings. Accordingly, we overrule the point of error. DECISION BASED ON NON-STATUTORY FACTORS Hams County, in its point of error ten, and Smith and Jackson, in their point of error “I.B.2,” complain the Commission abused its discretion by basing its decision in the case on a non-statutory factor — a public need factor. See Public Util. Comni’n v. South Plains Elec. Co-op, 635 S.W.2d 954, 957 (Tex.App.—Austin 1982, writ ref d n.r.e.). Consequently, they contend, we must reverse the agency decision and remand the case to the agency. See APA § 2001.174(2)(F). The Commission determined as follows in its findings of fact: 14. There is an existing and projected demand for the proposed hazardous waste management facility. (a) Incineration is a preferred waste management technology under both state and federal legislation. (b) The proposed facility is intended to serve area industry. (c) The proposed facility will provide additional treatment capacity necessary to meet the existing and projected demand resulting from the implementation and promulgation of new hazardous waste regulations. Moreover, one of the Commissioners declared in a hearing as follows: It’s also apparent that there is a need for additional incineration facilities in the state. We see that every day really in our hazardous waste program. I think that our capacity assurance study is in the record and all of the supporting information, and having been involved with the preparation of that document — its an ongoing process — I can say that from my own experience there is an [sic] need for additional incineration and other treatment capacity in this state even after we implement what I hope will be a very successful waste reduction program. Another Commissioner stated as follows at the hearing: “I think there’s a need for incinerators. I personally think that an incinerator is the way to go in hazardous waste.” We are reluctant to attribute to the Commissioners’ comments the meaning imputed to them by Harris County, Smith, and Jackson. It appears to us that the statements refer to incineration as a preferred method of waste disposal. Nevertheless, for the purpose of discussing the points of error, we will assume that the Commissioners’ comments and finding of fact fourteen represent, as Harris County, Smith and Jackson claim, the imposition of a public-need requirement that must be met before the Commission may issue a permit of the kind in dispute. A finding to that effect is, of course, a familiar licensing prerequisite found in a variety of regulatory statutes. Shortly before the hearing in which the Commissioners spoke, and before their decision in the case, the following amendment to the Act became effective: (a) To protect the public health and environment, encourage economic development, and assure the continuation of the federal funding for abandoned facility response actions, it is the state public policy that adequate capacity should exist for the proper management of industrial and hazardous waste generated in this state. Act § 361.0231(a) (emphasis added). The question of the need for a proposed facility might arise under this statute as an issue in a permit proceeding and require the Commission’s determination. We cannot agree, therefore, that the Commission erred to the appellants’ prejudice in finding of fact fourteen. If a dispute arose about whether the facility was necessary, the agency resolved the issue in finding of fact fourteen; if no issue arose in that regard, then the finding is mere surplusage. Indeed, it is difficult to understand an opposing party’s prejudice when the agency imposes an additional, non-statutory requirement upon the applicant and finds the requirement satisfied. Cf. South Plains Elec. Co-op., 635 S.W.2d at 956-57 (losing applicant complains of agency decision in favor of competing applicant based on non-statutory factor); Vandy griff v. Sabine Valley Sav. & Loan Ass’n, 613 S.W.2d 523, 525-26 (Tex.Civ.App.—Austin 1981, writ ref'd n.r.e.) (losing applicant complains of agency decision in favor of competing applicant, based on non-statutory factor, but not shown that such was basis of agency decision); Stan County v. Starr Indus. Servs., Inc., 584 S.W.2d 352, 356 (Tex.Civ.App.—Austin 1979, writ ref'd n.r.e.) (application denied based on non-statutory factor imposed on losing party). We find no error. If we are mistaken in that regard, however, we hold any error was not prejudicial. See APA § 2001.174(2). LEGAL CRITERIA NOT IDENTIFIED IN CONCLUSIONS OF LAW In several “findings of fact” and conclusions of law, the Commission stated its determination that various aspects of the application satisfied federal or state requirements. The agency did not, however, specify the particular statute or regulation that imposed the requirement in question. For example, the Commission determined: The trial burn requirements specified in the application and permit satisfy state and federal requirements and are sufficient to demonstrate whether the incinerator system is capable of achieving applicable performance standards. This determination is designated “finding of fact” number seventeen; however, it is patently a conclusion of law for it declares a legal effect or consequence. Indeed, when an agency declares a legal requirement satisfied, it necessarily states a conclusion of law. See John Powers, Judicial Review of the Findings of Fact Made by Texas Administrative Agencies in Contested Cases, 16 Tex.Tech.L.Rev. 475, 476-83 (1985). Harris County complains, in its point of error seven, that the Commission committed legal error in failing to identify in its conclusions of law the particular statute or regulation that the Commission deemed satisfied. Jackson and Smith make the same complaint in their point of error “I.B.2.” Because the Commission’s determinations are all inherently conclusions of law, the issue reduces to whether the Commission was legally required to cite each particular statute or regulation the agency believed was satisfied, because a • general reference, such as “trial burn” requirements, was insufficient in the appellants’ view. We find no authority for the position taken by Harris County, Jackson, and Smith. We cannot find that the Commission labored under a legal duty of the kind for which they contend. Section 2001.141(d) of the APA does not impose such a duty. That statute requires a statement of the conclusions of law upon which the agency reached its decision; and it requires a statement of the underlying facts from which the agency inferred its conclusions of law or “findings set forth in statutory language,” but the statute does not even remotely suggest the requirement advocated by Harris County, Jackson, and Smith. And while they imply such a requirement exists, they cite no authority for it. Such a requirement would be impractical in our view and contrary to the established rule that a reviewing court, in cases of substantial-evidence review, is bound to affirm the agency order “if it is correct on any theory of law applicable to the case, ... whether or not the [agency] gives a correct legal reason for such order, or whether or not it gives any reason at all therefor.” Gulf Land Co. v. Atlantic Ref. Co., 134 Tex. 59, 131 S.W.2d 73, 84 (1939) (distinguishing between the legal basis for an agency order and its factual basis). We overrule the points of error. COMMISSION’S FAILURE TO ADOPT THE HEARING EXAMINER’S FINDINGS OF FACT AND CONCLUSIONS OF LAW Smith and Jackson complain in their point of error “I.B.2” that the Commission omitted to explain its failure to adopt the findings of fact and conclusions of law proposed by the hearing examiner. They do not, however, point to any particular fact finding or conclusion of law; they do not suggest how they were prejudiced in the matter; and they cite no authority for their claim of error, so that we might perhaps infer whether they complain of something involving witness credibility, agency policy, or another relevant factor. We overrule the point of error. See Tex. R.App.P. 74(d), (f). POST-HEARING INCLUSIONS IN THE PERMIT Smith and Jackson complain in their point of error “I.C.l” that they were denied a hearing on several critical issues because two major provisions were included in the permit after the hearings closed. The first item involves the trial-burn elements of the permit. In this connection, Smith and Jackson refer us to the transcript of the Commissioners’ hearing held, after close of the evidence, on October 10, 1990. The record reflects the following changes ordered in the permit after the close of