ILLI~OI3 PDLL(JTID~4 CONTROL BOARD

December 5, 1985

c)EMEPER, INC..,

Petitioner,

v.

)

PCB•85—75

tf4t4INOIS ENVIRONMENTAL

PR3TECTtO~4AGENCY,

Respondent.

~1

t,~.OYO SMITH and KE\1 KLEMME APPEARED O~ 8E~1ALF

OF’

PErErro.’1I~R;

~ILIEIIAM0. INGERSOLL, ASSISTANT ATTORNEY GENERAL, APPEARED 04

BEcIALF OF’ RESPONDENT.

OPINION A~’TD ORDER OF

THE

BOARD (by R. C. Flemal):

This matter comes before the Board pursuant to a variance

petition filed by Demeter, Inc. (“Demeter”) on May 2?, 1985.

)eateter seeks variance from the provisions of 35 IlL

Adrn.

Code

212.462(e) for a period of four years.. Section 212.462(e)

identifies New and Modified Grain—Handling Operations and control

equipment requirements applicable to same.

-

The Board finds that

Petitioner will suffer arbitrary or unreasonable hardship without

variance relief. Thus, v~iriance frornS212.462(e) ~wii1 be grant~3

to Demeter for the period of four years subject to conditions,

beginning the date of this Opinion and Order.

Demeter waived hearing in this matter by inclusion in its

~1ay21 petition of a provision so statIng. The Illinois

Environmental Protection Agency (“Agency”), however, gave notice

to the Board on June 5, 1985 of its objection to the variance,

and requested that a hearing be authorized, The Agency reasoned

that hearing is necessary under the Clean Air Act since

S212.462(e) is an approved part of the Illinois State

Implementation

Plan.

Hearing was held on October 21, 1985.

The Agency filed a recommendation in this case on June 24,

1985, advising that Demeter~spetition for variance be denied

because, in its view, Petitioner offered no plan through which it

could come into compliance by the end of the variance period and

also failed to adequately show it would suffer an arbitrary or

unreasonable hardship if denied varia’rice relief. Demeter waived

the 90—day time for decision (as provided for in §38 of the

Illinois Environmental Protection Act) in this matter on July 3,

198!~, and filed an amended variance petition on August 7, 1985

intended to address the concerns expressed by the Agency in its

67-31

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recommendation. The Agency amended its recommendation on

September 10, 1985, and presently suggests that Demeter be

granted variance subject to conditions for the full four—year

period as requested by Petitioner.

Demeter operates a grain elevator on 16 acres of land in an

industrial area 1’/2miles south of South Beloit in winnebago

County, Illinois. The facility receives, dries, stores and ships

grain (primarily corn, soybeans, wheat and oats) and employs

seven people.

Demeter seeks variance from §212,462(e), which requires new

and modified grain—handling operations to file applications for

construction and operating permits pursuant to 35

Ii.?,

kdm. Code

201 and to comply with the control equipment requirements of

§212.462. Petitioner’s facility originally qualified for an

exemption from

the

control requirements of 5212,462(b) (which

i-elate to major dump—pit areas, and are relevant, to thist case) by

action of §212.461(c) because the facility is located outside of

a major population area and had not lost the exemption due to the

existence of other violations. Consequently, up to this time

Demeter has not installed dump pit dust controls on its primary

receivingpit, as would otherwise be required under §212.462(b).

For grain—handling operations at which no physical

.~lterations or additions take place, Section 212.462(e) provides

that a “modification” occurs when the increase in the annual

grain through—put (“AGT”) for the facility exceeds30 of ‘the~hGT

on which the operation’s original construction and/or operating

permit was granted. The definition of AGT is found at §211.122

of Title 35, and says that AGT for an operation is found by

adding its grain receipts and shipments for the three previous

fiscal years and dividing the total by 6. F’or Derneter, this

number is derived from the following data which the Agency

asserts was provided by ~emeter in its AGT report of November 1,

1984:

1981/82

.

2,510,873 bu. received

1,549,575

bu.

shipped

1982/83

4,718,542 bu. received

2,166,976

bu.

shipped

1983/84

2,797,732 bu. received

3,187,821 bu. shipped

16,931,519 bu. received/shipped

16,931,519 bu.

/

6

=

2,821,920 bu.. AGT

Petitioner’s facility was originally permitted at an AGT of

1,100,000 bushels per year (Agency Recommendation, Appendix

p.4). Therefore it is clear that Demeter’s AGT has increased

~nore than

30, and thus that the facility has been “modified” as

defined by §212.462(e).

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—3—

Environmental Impact

The Demeter operation is located in a rural section~of

Winnebago County, in the extreme northern portion of Illinois,

Winnebago County is designated’ as an attainment area for

particulates and the Agency believes that any adverse

environmental impact stemming from Petitioner’s facility would be

minimal (Variance Recommendation Amendment, ¶15—16).

~‘1evertheiess,for the record the Agency and Demeter provide

differing characterization of the quantity of grain dust

discharged from the dump pit operation. Petitioner contends a

“minimal” amount of grain dust is discharged (Variance Petition,

p.1), whereas the Agency calculates the amount to be

approximately 22 tons per year (Variance Recommendation, ¶7).

While a modeling study has not been done, it appears that no

adverse environmental impact has or will occur due to the

continued operation of Demeter’s dump pits during the pendency of

this variance,

~1ardship

Throughout this case Petitioner has contended that, for two

reasons, it would suffer arbitrary or unreasonable hardsLhip if

forced to install dump pit controls at the South Beloit

facility. First, Demeter believes that the 30 increase it

experienced over its base period volume (triggering the

applicability of §212.462(e)) was attributable to Demeter’s

participation in one—time programs such as the federal P1K

(Payment—In—Kind) program during the 1983/84 period. Second,

Petitioner alleges that it would be financially unable to install

grain dust control systems,.if such were required, due to the

poor economic condition of the agri—business industry and

Demeter’s low profitability over the past several years. .Demeter

asserts that for the years 1981 through 1984 the total four—year

profit of the firm was under $30,000 (Amended Variance Petition,

p. 1). The Agency does not contest this assertion.

The Agency concurs with Demeter’s assertion that arbitrary

or unreasonable hardship is present, but only for the latter

reason given by Petitioner. The Agency agrees that Demeter is

not in a position to finance the purchase and installation of

control equipment, the cost of which could range from $60,000 to

$93,500 (Variance Recommendation Amendment, ¶13). The Agency

disputes, however, the relevance of Demeter’s position that its

AGT increase of greater than 30 was attributable to one—time

government programs. The Agency argues that this is an incorrect

interpretation of §212.462(e); that the section provides that

when AGT increases by more than 30 over the AGT on which the

facility’s original permit was granted, the facility is then

“modified” and cannot return to its original status.

Balancing the minimal environmental impact from Demeter’s

activities against the economic hardship Petitioner would endure

if required to

immediately install dump pit controls the Board

finds that denial of variance relief would constitute arbitrary

or unreasonable hardship. The Board notes that it is not at this

67-33

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—4—

time addressing the question of whether §212.462(e) can be

interpreted to allow a reversion in the status of a facility

after such facility has been “modified”, as defined by that

section,

The Board generally accepts and imposes on Derneter the

variance conditions as proposed by the Agency, with the exception

of that one requiring Demeter to post a performance bond to

assure the performance of the work necessary to bring

Petitioner’s facility into compliance. The Agency itself notes

that Demeter’s history of compliance is generally good (Agency

Recommendation, ¶9). In light of that assertion, as well as

Demeter’s stated intention to come into compliance, the Board

finds that the posting of a performance bond is not necessary in

this instance.

This Opinion constitutes the Board’s findings of fact and

conclusions of law in this matter.

ORDER

The South Beloit, Illinois facility of Demeter, Inc. is

hereby granted variance from the provisions of 35 Ill. Adm. Code

212.462(e) regarding Modified Grain—Handling Operations, subject

to the following conditions:

1. This variance begins the date of this Order and extends

through December 4, 1989.

2. Demeter shall annually provide grain through—put data

pertaining to its South Beloit facility to the Agency.

3. On or before March 1, 1989, Demeter shall make

application to the Agency for a construction permit for

a dust control system to achieve compliance with

regulations in effect at that time, and such system

shall be in operation prior to the end of the variance

term.

4. Demeter shall perform yearly studies of the cost and

availability of dust control systems applicable to their

operation, and shall submit such studies prior to each

anniversary date of the grant of this variance, to:

Illinois Environmental Protection Agency

Division of Air Pollution Control

Field Operations Section

5415 North University

Peoria, Illinois 61614

5. If the average of grain receipts and shipments at the

South Beloit facility for any one year period, as

reported to the Agency, exceeds 2,500,000 bushels,

Derneter shall apply for a construction permit for a dust

control system, and shall complete installation of such

system within six months of the date such permit is

issued.

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-.5—

6. Within forty—five days of the date of this Order, the

Petitioner shall execute and send to:

William 0. Ingersoll

Enforcement Programs

Illinois Environmental Protection Agency

2200 Churchill Road

Springfield, Illinois 62706

a certification of acceptance of this variance by which

it agrees to be bound by its terms and conditions.

This forty—five day period shall be held in abeyance for any

period during which this matter is being appealed. The form of

the certification shall be as follows:

CERTIFICATION

Demeter, Incorporated hereby accepts and agrees to be bound

by all terms and conditions of the Order of the Illinois

Pollution Control Board in PCB 85—75, dated December 5, 1985.

Demeter, Incorporated

By:

___________________________

As Authorized Agent

Title

Date

IT IS SO ORDERED.

I, Dorothy N. Gunn, Clerk of the Illinois Pollution Control

Board, hereby certify that the above Opinion and Order was

adopted on the

_________________

day of

~

,

1985, by

~ vote of

_____________

~

~.

/~_~

Dorothy N. Gunn, Clerk

Illinois Pollution Control

87-35