ILLINOIS POLLUTION CONTROL BOARD
May 21, 1992
FRED M. STRUBE and
)
CYNTHIA L. STRUBE,
)
Petitioners,
v.
)
PCB 91—205
(Underground Storage
ILLINOIS ENVIRONMENTAL
)
Tank Reimbursement)
PROTECTION AGENCY,
)
)
Respondent.
DIANA M. JAGIELLA, HOWARD & HOWARD, APPEARED ON BEHALF OF
PETITIONER;
RONALD L. SCHALLAWITZ, APPEARED ON BEHALF OF RESPONDENT.
OPINION AND ORDER OF THE BOARD (by B. Forcade):
This matter comes before the Board on a petition filed on
October 31, 1991, by Frank N. Strube and Cynthia L. Strube
seeking review of an Underground Storage Tank Reimbursement
Determination. The Strubes seek review of the Agency’s denial of
reimbursement of $10,355 for above ground resurfacing charges.
BACKGROUND
The Strubes are the owners of property at 700 Spring Street,
Peoria, Illinois at which was located Fred Strube’s 66 Service
Station. (Tr. at 15.) In anticipation of closing the business
and selling the property, the Strubes removed five underground
storage tanks from the property. (Tr. at 17.) During removal of
the tanks, contamination was discovered and the release was
reported to the Emergency Services and Disaster Agency. (Tr. at
15.). The Strubes submitted an application for reimbursement to
the Agency. (R. at 12.) The Agency after reviewing the
application determined that the Strubes were eligible for
reimbursement subject to a $15,000 deductible. (R. at 41.) Upon
a review of the invoices submitted to the Agency, it was
determined that the $10,355 for the replacement of concrete was
not a reimbursable cost. (R. at 132.) The Agency determined that
this was not a reimbursable cost because it was not a corrective
action and the costs associated with the replacement of
structures is not reimbursable. (R. at 133.)
On October 31, 1991, the Strubes filed a petition for review
contesting the Agency’s determination that the replacement of
concrete is not eligible for reimbursement. A hearing was held
on January 29, 1992 in Peoria, Illinois. The Strubes filed a
133—513
2
post hearing brief on March 10, 1992, and the Agency filed its
post hearing brief on March 30, 1992. A reply brief was filed by
the Strubes on April 8, 1992.
DISCUSSION
The Strubes argue that the guidance manual, distributed to
the public by the Agency, provides for the reimbursement of the
costs for replacement of the concrete. The Strubes argue that
the Agency’s position that the reassembly of a driveway would be
reimbursable, while repaving of the driveway is not reimbursable,
is completely unreasonable. The Strubes further argue that the
Agency has failed to adopt rules for the administration of the
Underground Storage Tank Fund and the Agency’s failure to
establish rules should not be used to the detriment of the
Strubes. The Strubes argue that the Agency should be required to
reimburse the cost of the replacement of concrete because the
Agency approved reimbursement to the Strubes in phone
conversations and in public statements.
The Agency argues that the cost of replacement of concrete
is not a reimbursable expense because it is not corrective
action. The Agency also contends that the statute must control
and the guidance manual is not a rule. The Agency further argues
that the guidance manual does not provide that the replacement of
concrete is reimbursable but refers to the “reassembly” of
structures.
In addressing the arguments raised by the Strubes and the
Agency, the Board looks at the role of the guidance manual,
corrective action and the representations made by the Agency.
GUIDANCE MANUAL
The Strubes argue that the guidance manual distributed to
the public by the Agency states that the cost for the replacement
of concrete is a reimbursable expense. The Agency argues that
the guidance manual allows for the “reassembly” of structures and
that the replacement of concrete is not a reassembly. The Agency
contends that this provision of the manual is intended to allow
for reassembly of small structures such as canopies and to
prevent people from tearing down their stations, building a new
one and expecting the fund to pay for it. (Tr. at 155.) The
Strubes argue that “reassembly” of concrete is impractical and
not cost effective. (Tr. at 158.)
The guidance manual clearly allows for reimbursement for the
dismantling and “reassembling of structures” and includes paving
(concrete or asphalt) as a structure. There is no provision in
the statute that deals with the replacement or reassembly of
structures.
133—5! 4
3
In Platolene 500, Inc.
V.
IEPA (May 7, 1992), PCB 92—9,
_____
PCB
________,
the Board found that the guidance manual was a rule
which was not promulgated according to the Administrative
Procedure Act (APA) and therefore the.manual has no legal or
regulatory effect in proceedings before the Board. Therefore, as
in Platolene, the Board cannot enforce the provisions of the
guidance manual and determinations on reimbursement must be
consistent with any applicable statutory or regulatory
requirements.
In Community Nutrition Institute v. Young (D.C. Cir. 1987),
818 F.2d 943, after finding that an FDA standard could not stand
because it was not subjected to the required notice and comment
requirements, the court commented on the role of guidance
manuals,
Our holding today in no way indicates that agencies
develop written guidelines to aid their exercise of
discretion only at the peril of having a court
transmogrify those guidelines into binding norms. We
recognize that such guidelines have the not
inconsiderable benefits of apprising the regulated
community of the agency’s intentions as well as
informing the exercise of discretion by agents and
officers in the field. It is beyond question that many
such statements are non—binding in nature and would
thus be characterized by a court as interpretative
rules or policy statements. We are persuaded that the
courts will appropriately reach an opposite conclusion
only where as here, the agency itself has given its
rules substantive effect.
The Act “authorizes the Agency to adopt reasonable and
necessary rules for the administration of this Section.” (Section
22.18b(f).) The Agency has chosen not to promulgate rules
pertaining to reimbursement but rather evaluates each application
separately on its own merits, on a case by case basis. (Pet. Br.
at 39.) The evaluation of the application by the Agency is
governed by the requirements of the statute.
CORRECTIVE ACTION
The statute limits reimbursement to costs of corrective
action. (Section 22.l8b(a)) The definition of corrective action
consists of two inquiries: whether the costs are incurred as a
result of an action to “stop minimize, eliminate, or clean up a
release of petroleum”, and whether those costs are the result of
such activities as tank removal, soil remediation and free
product removal. (Ill. Rev. Stat. 1989, ch. 111 1/2, par.
1022.18(e) (1) (C), see Enterørise Leasing Company v. IEPA (April
9, 1992), PCB 91—174, _____PCB_____
.)
In applying this
1 33—51.5
4
definition of corrective action to the replacement of concrete
the Board has determined that the replacement of concrete under
most circumstances does not constitute corrective action, because
it is not an act to stop or minimize a release. (Platolene 500,
Inc. v. IEPA (May 7, 1992), PCB 92—9, _____PCB
.)
However,
the Board does believe that under certain circumstances the
replacement of concrete may be proven to be a corrective action.
(Ibid. at 6.) The particular facts surrounding the action and
the purpose of the action will ultimately determine whether that
action is a corrective action. (Ibid. at 6.)
The facts in this case do not support a finding that the
Strubes replacement of concrete satisfies the statutory
definition of corrective action. The Strubes did not present
evidence to show that their replacement of concrete was a
corrective action. However, the Strubes do argue that such a
strict reading of the statute and the definition of corrective
action is contrary to the purpose of the fund as stated in the
statute. (Reply Br. at 3.)
Section 22.13(a) of the Act provides that monies from the
fund may be used for the following purposes:
***
3. to assist in the reduction and mitigation of damage
caused by leaks from underground storage tanks,
***
5. for payment of costs of corrective action incurred by
and indemnification to operators of underground storage
tanks as provided in Section 22.18b of this Act.
The Strubes characterize the purpose of the fund as a “broad
remedial purpose” which requires that reimbursement be available
for reasonable site restoration expenses. (Reply Br. at 3.)
The Board does not see the fund as having such a broad
purpose. The Board believes that allowing the fund to reimburse
for reasonable restoration expenses is contrary to the statutory
definition of corrective action.
AGENCY REPRESENTATIONS
The Strubes argue that the Agency represented that the
replacement of concrete would be reimbursed in phone
conversations with Cindy Strube ahd at a workshop on the UST
program.
Mrs. Strube talked with Doug Oakley of the Agency on
February 27, 1991. Mrs. Strube described her conversation with
133—516
5
Mr. Oakley as follows:
A. I asked him about the concrete work because of
switching contractors. And he told me to submit
the bill.
Q. Did you refer to repaving the driveway when you were
talking with Mr. Oakley?
A. Yes.
Q. Did Mr. oakley tell you during that conversation that
repaving the driveway was not an expense eligible for
reimbursement from the UST fund?
A. No.
Q. Did you have any conversations with Mr. Oakley after
that time?
A. Yes.
Q. When was the next time you talked to Mr. Oakley?
A. On March 8 of 1991, 10:45 a.m., Florida time. I asked
him again about the concrete to make sure because of
switching contractors. He said no problem, but it had
to be on their billings.
Q. ...After you talked to Mr. Oakley the second time, did
he tell you that repaving the driveway was not an
expense eligible for reimbursement from the fund?
A. No.
(Tr. at 31
—
33.)
Mr. Oakley testified concerning his phone conversations with Mrs.
Strube as follows:
Q. Do you remember any specific conversations concerning
the replacement of concrete?
A. It may have been mentioned, but I don’t remember
specifics.
Q. If you recall, do you remember if she asked you
specifically and directly whether or not the cost of
repaving whether or not the costs of repaving or
replacing the concrete would be a reimbursable expense?
133—517
6
A. I don’t recall.
Q. Do you give definitive answers over the telephone as to
whether a particular cost is reimbursable or not in the
course of your job?
A. No.
Q. Why not?
A. There’s too many variables involved. The laws change,
prices you know. It’s just -— basically, what we do is
we ask them to submit the billings; and we look at the
billings. And then we make our determination.
Q. To the best of your recollection or memory, did you
ever tell Mrs. Strube that the Agency would reimburse
concrete replacement for the resurfacing of her gas
station for the underground storage tank fund?
A. No.
(Tr. at 100 — 101.)
Jim Ketchum of the Agency also testified as to the Agency’s
policy of not making pre—determinations of reimbursements of
costs.
Q. Do you ever recall over the telephone giving definitive
determinations or preliminary determinations of
eligibility of costs?
A. No. We usually or always refrain from doing so. And
our typical response is submit it and we’ll look at it
which does them justice. because in choosing that route
they’ll have the right later to make an appeal on the
decision.
(Tr. at 129.)
Mrs. Strube testified that she spoke with the Agency
concerning the replacement of concrete and they told her to
submit the bill. She did not testify that anyone at the Agency
made a positive statement that the cost would be reimbursed. She
stated that the Agency did not inform her that the cost of
repaving the driveway would~not be reimbursed. The testimony
shows that the Agency did not make any representation on
reimbursement but merely requested that the bills be submitted
for the Agency’s review. There i~no evidence in the record to
show that the Agency represented to Mrs. Strube that the cost for
replacement of concrete would be reimbursed from the fund.
133—518
7
The Agency was aware that the Strubes planned to repave the
driveway but did not inform Mrs. Strube whether the cost of
repaving would be reimbursed. Because the Agency has not
promulgated rules concerning which cost are reimbursable the
Agency is not in a position to make pre—determinations on
reimbursement of specific costs.
The Strubes also argue that Bur Filson of the Agency, at a
workshop held in October, 1991 in response to a question from the
floor, stated that repaving was an eligible cost for
reimbursement. (Tr. at 79.) While the Strubes were not present
at the workshop, Mike Hoffman of Environmental Science and
Engineering, a sub—contractor on the project, did attend the
workshop. The site was repaved in July of 1991 (Tr. at 23) and
the conference occurred in October of 1991. (Tr. at 79.)
The testimony of Agency personnel that were present at the
workshop disagree with Mr. Hoffman as to exactly what question
was asked and what Mr. Filson’s response meant. Mr. Filson did
not testify at the hearing. Because Mr. Filson did not testify,
the statement cannot be used to represent a position of the
Agency. Further, the repaving at the Strube’s station took place
three months prior to the workshop. Therefore, the
representation at the workshop was not a factor in the Strubes’
decision to replace the concrete.
The Board finds that the evidence presented concerning the
representations of the reimbursement of the cost of concrete
replacement does not show that the Agency informed Mrs. Strube
that the cost was reimbursable. The evidence merely shows that
the Agency requested that the bills for the concrete be submitted
for review. Also as previously discussed, allowing for the
reimbursement of an action which is not a corrective action would
be in violation of the statute.
CONCLUS ION
The guidance manual has no legal force or effect because it
was not promulgated according to the requirements of the APA.
Corrective action is an action to stop, minimize, eliminate or
clean up a release of petroleum. The Strubes have not shown that
the replacement of concrete at their station was a corrective
action. The Agency did not inform the Strubes about the
reimbursement for costs associated with repaving but requested
that the bills be submitted for review. Therefore, the Board
finds that the Strubes are not eligible for reimbursement of the
cost of replacement of concrete pursuant to the statute.
This opinion constitutes the Board’s finding of facts and
conclusions of law in this matter.
I 33—5 I 9
8
ORDER
The Board affirms the Agency determination that the Strube’s
cost of replacement of concrete is not a reimbursable expense
because the repaving did not constitute a corrective action.
IT IS SO ORDERED.
Section 41 of the Environmental Protection Act
(Ill.Rev.Stat. 1991, ch. 111 1/2, par. 1041) provides for the
appeal of final, orders of the Board within 35 days. The Rules of
the Supreme Court of Illinois establish filing requirements.
I, Dorothy Gunn, Clerk of the Illinois Pollution Control
Board, hereby certify that the above opinion and order was
adopted on the
~/~-~2--’~--
day of
~
,
1992, by a vote
of
7—~ .
/~
Dorothy N.,~unn, &~lerk
Illinois P.állution Control Board
133—520