HOBBS, N.M. (AP) — The New Mexico Environment Department has denied a discharge permit for a Hobbs dairy, contending is not complying with state groundwater regulations.

Ruch Dairy owners John and Marta Ruch sought permission to discharge up to 40,000 gallons of dairy wastewater a day and apply it to 100 acres of crop land.

The Environment Department said four community members urged Environment Secretary Ron Curry to deny the permit because of odors and flies as well as noncompliance with groundwater rules.

Ruch attorney Pete Domenici Jr. said the problems stem from previous owners who were buying the dairy from the family but defaulted.

The department alleged the dairy operated without a permit despite the Ground Water Bureau telling it in November 2009 it did not have permission to discharge until the bureau issued a final permit.

Domenici said the Ground Water Bureau supported the application in the pre-permit and hearing process.

The bureau "feels this permit is protective and unequivocally supported its issuance," he said. "This is a unilateral action by Secretary Curry that is at odds with his own bureau and inconsistent with how other groundwater permits have been issued."

Curry, in a news release last week, said the dairy, formerly K & B Dairy, "has been a flagrant violator of state environmental laws, including operating without a valid permit. The dairy's owners failed to operate in a responsible manner that would protect New Mexico's limited groundwater supplies."

The denial of the permit requires the owners to remove cows from the property within 60 days. The dairy at that time must cease discharges until a new groundwater discharge permit is approved.

The Ruchs, who are in their 80s, referred questions to their daughter, Janet Bruelhart.

She, in turn, referred questions about the permit to Domenici, but told the Hobbs News-Sun in an e-mail the decision is "an incredible injustice against my parents who immigrated to this country in hopes of achieving the American dream."

"They are the most law-abiding citizens you can imagine. That dairy is their retirement, and there is a real story about stewardship and honesty beneath all this," she wrote.

Domenici said he believes the permit ultimately will be issued, allowing the family to make improvements to sell the dairy.

"Their goal is to upgrade this facility and get another operator in there," he said.

Copyright 2010 The Associated Press.