BEFORE
OFTHETHEPOLLUTIONSTATE OFCONTROLILLINOIS
BOARD
R
CL~-,K
E
~
.5
O~-~CF
i~
v~.~
IN THE MATTER OF:
JUL
082005
)
STATE OF ILLJNOiS
PROPOSED AMENDMENTS TO:
)
Pollution Control Board
REGULATION OF PETROLEUM LEAKING
)
R04-22
UNDERGROUND STORAGE TANKS
)
(UST Rulemaking)
(35
ILL. ADM. CODE 732),
)
)
iN THE MATTER OF:
)
)
PROPOSED AMENDMENTS TO:
)
REGULATION OF PETROLEUM LEAKING
)
R04-23
UNDERGROUND STORAGE TANKS
)
(UST Rulemaking)
(35
ILL. ADM. CODE 734)
)
Consolidated
)
NOTICE OF FILING
TO:
ALL COUNSEL OF RECORD
(Service List Attached)
PLEASE
TAKE
NOTICE
that on July 8, 2005, filed with the Clerk of the Illinois
Pollution Control Board of the State of Illinois an original, executed copy of Pre-Filed
Testimony & Revised Regulations from CW3M, Company, Inc. for the Illinois Pollution Control
Board’s First Notice ofAmendments to 35 Ill. Adm. Code 734 and 35 Ill. Adm. Code 732 in the
above-captioned matter.
Dated: July 8, 2005
Respectfully submitted,
CW3M Company
By:
C ~
~•
OiI~of Its Attb~neys
Carolyn S. Hesse, Esq.
Barnes & Thornburg LLP
One North Wacker Drive -Suite 4400
Chicago, Illinois 60606
(312) 357-1313
279835v1
This tiling submitted on recycled paper as defined in
35
III. Adm. Code 101.202
CERTIFICATE OF SERVICE
I, on oath state that I have served the attached Pre-Filed Testimony & Revised
Regulations from CW3M, Company, Inc. for the Illinois Pollution Control Board’s First Notice
of Amendments to 35 Ill. Adm. Code 734 and 35 Ill. Adm. Code 732 by placing a copy in an
envelope addressed to the Service List Attached from CW3M Company, Inc., 701 West South
Grand Avenue, Springfield, IL 62704 before the hour of 5:00 p.m., on this
11th
Day of July,
2005.
~
Carol Rowe
This tiling submitted on recycled paper as defined in 35 Ill. Adm. Code 101.202
2..
Service
List
Gina Roccaforte
Kyle Rominger
IEPA
1021 North Grand Avenue East
P.O. Box 19276
Springfield, IL 62794-9276
217/792-5544
217/782-9807 (fax)
William G. Dickett
Sidley Austin Brown & Wood
Bank One Plaza
10 South Dearborn Street
Chicago, IL 60603
312/853-7000
312/953-7036 (fax)
Bill Fleischi
Illinois Petroleum Marketers Association
112 West Cook Street
Springfield, IL 62704
217/793-1858
Robert A. Messina
General Counsel
Illinois Environmental Regulatory Group
3150 Roland Avenue
Springfield, IL 62703
217/523-4942
217/523-4948
Lisa Frede
Chemical Industry Council ofIllinois
2250 East Devon Avenue
Des Plaines, IL 60018
(847) 544-5995
Thomas G. Safley
Hodge Dwyer Zeman
3150 Roland Avenue
P.O. Box 5776
Springfield, IL 62705-5776
217/528-4900
217/523-4948 (fax)
Barbara Magel
Karaganis & White, Ltd.
414 North Orleans Street
Suite 801
Chicago, IL 60610
312/836-1177
312/836-9083 (fax)
Joe Kelly, PE
United Science Industries, Inc.
6295 East Illinois Highway 15
P.O. Box 360
Woodlawn, IL 62898-0360
618/735-2411
618/735-2907 (fax)
Kenneth James
Carison Environmental, Inc.
65
East Wacker Place
Suite 1500
Chicago, IL 60601
Michael W. Rapps
Rapps Engineering & Applied Science
821 South Durkin Drive
P.O. Box 7349
Springfield, IL 62791-7349
217/787-2118
217/787-6641
(fax)
Joel J. Sternstein, Assistant Attorney General
Matthew J. Dunn, Division Chief
Office ofthe Attorney General
Environmental Bureau
188 West Randolph,
20th
Floor
Chicago, IL 60601
312/814-2550
312/814-2347 (fax)
Dorothy M. Gunn, Clerk ofthe Board
Marie Tipsord, Hearing Officer
Illinois Pollution Control Board
100 West Randolph Street, Suite 11-500
Chicago, IL 60601
312/814-3956
Scott Anderson
Black & Veatch
101 North Wacker Drive
Suite 1100
Chicago, IL 60606
Claire A. Manning
Brown, Hay & Stephens, LLP
205 South Fifth Street
Suite 700
P.O. Box 2459
Springfield, Illinois 62705-2459
(217) 544-8491
(217) 241-3111
(fax)
Jonathan Fun, General Counsel
Illinois Department ofNatural Resources
One Natural Resources Way
Springfield, IL 72702-1271
217/782-1809
217/524-9640 (fax)
A.J. Pavlick
Great Lakes Analytical
1380 Busch Parkway
Buffalo Grove, IL 60089
847/808-7766
Tom Herlacher, P.E.
Principal Engineer
Herlacher Angleton Associates, LLC
8731 Bluff Road
Waterloo, IL 62298
618/935-2261
618/935-2694 (fax)
James E. Huff, P.E.
Huff & Huff, Inc.
512 West Burlington Avenue
Suite 100
LaGrange, IL 60525
Melanie LoPiccolo, Office Manager
Marlin Environmental, Inc.
1000 West Spring Street
South Elgin, IL 60177
847/468-8855
Brian Porter
Terracon
870 40th
Avenue
Bettendorf, IA 52722
563/355-0702
Glen Lee, Manager
Wendler Engineering Services, Inc.
1770 West State Street
Sycamore, IL 60178
815/895-5008
Joseph W. Truesdale, P.E.
CSD Environmental Services, Inc.
2220 Yale Boulevard
Springfield, IL 62703
217/522-4085
2
David L. Rieser, Partner
McGuire Woods LLP
77 West Wacker Drive
Chicago, IL 60601
312/849-8249
Kurt Stepping
Director of Client Services
PDC Laboratories
2231 West Altorfer Drive
Peoria, IL 61615
309/692-9688
Daniel J. Goodwin
Secor International, Inc.
400 Brims Lane
Springfield, IL 62702
Richard Andros, P.E.
Environmental Consulting & Engineering, Inc.
551
Roosevelt Road, #309
Glen Ellyn, IL 60137
Steven Gobelman
Illinois Department of Transportation
2300 Dirksen Parkway
Springfield, IL 62764
Jennifer Goodman
Herlacher Angleton Associates, LLC
522 Belle Street.
Alton, IL 62002
Ron Dye
President
Core Geological Services
2621 Monetga
Suite C
Springfield, IL 62704
(217) 787-6109
Monte Nienkerk
Clayton Group Services, Inc.
3140 Finley Road
Downers Grove, IL 60515
630/795-3207
Thomas M. Guist, PE
Team Leader
Atwell-Hicks, Inc.
940 East Diehl Road
Suite 100
Naperville, IL 60563
630/577-0800
Dan King, Team Leader
United Science Industries, Inc.
6295 East Illinois Hwy
15
Woodlawn, IL 62898
618/735-2411
Terrence W. Dixon, P.G..
MACTEC Engineering & Consulting, Inc.
8901 N. Industrial Road
Peoria, IL 61615
Collin W. Gray
SEECO Environmental Services, Inc.
7350 Duvon Drive
Tinley Park 60477
George F. Moncek
United Environmental Consultants, Inc.
119 East Palatine Road
Palatine, IL 60067
Tina Archer, Attorney
Greensfelder, Hemker & Gale
10 South Broadway
Suite 2000
St. Louis, MO 63104
314/241-9090
3
Erin Curley, Env. Department Manager
Midwest Engineering Services, Inc.
4243 West
166th
Street
Oak Forest, IL 60452
708/535-9981
Russ Goodiel, Project Manager
Applied Environmental Solutions, Inc.
P.O. Box 1225
Centralia, IL 62801
6 18/533-5953
Eric Minder
Senior Environmental Engineer
Caterpillar, Inc.
100 NE Adams Street
Peoria, IL 61629
(309) 675-1658
208776vl
Ken Miller, Regional Manager
American Environmental Corp.
3700 West Grand Ave., Suite A
Springfield, IL 62707
217/585-9517
Jarrett Thomas
Vice President
Suburban Laboratories, Inc.
4140 Litt Drive
Hillside, IL 60162
(708) 544-3260
Daniel Caplice
K-Plus Environmental
600 West Van Buren Street
Suite 1000
Chicago, IL 60607
(312) 207-1600
4
BEFORE THE POLLUTION CONTROL BOARIS~LEH~S
OFF~CE
OF THE STATE OF ILLINOIS
J~L
082005
IN THE MATTEROF:
)
STATE OF ILLINO1S
)
Pollution Control Board
PROPOSED AMENDMENTS TO:
)
REGULATION OF PETROLEUM LEAKING )
R04-22
UNDERGROUND STORAGE TANKS
)
(UST Rulemaking)
(35 ILL. ADM. CODE 732),
)
)
IN THE MATTER OF:
)
)
PROPOSED AMENDMENTS TO:
)
REGULATION OF PETROLEUM LEAKiNG )
R04-23
UNDERGROUND STORAGE TANKS
)
(UST Rulemaking)
(35 ILL. ADM. CODE 734)
)
Consolidated
)
Proposed Rule. First Notice
PRE-FILED TESTIMONY
&
REVISED REGULATIONS FROM CW3M COMPANY,
INC. FOR THE ILLINOIS POLLUTION CONTROL BOARD’s 1st NOTICE OF
AMENDMENTS TO 35 ILL. ADM. CODE 734 AND 35 ILL. ADM. CODE
732
My name is Vince Smith. I am employed with the CW3M Company as the senior environmental
engineer. I have been in my current position since June 2000. Prior to assuming my current
position, I was employed by the City of Springfield, Illinois, Department of Public Works, the
Illinois Department ofNuclear Safety, and Alpha Testing, Inc. I received a B.A. in Mathematics
from Culver-Stockton College in 1984 and a B.S. in Civil Engineering from the University of
Missouri — Rolla in 1985. I am a Registered Professional Engineer in the State of Illinois.
The testimony was prepared with the assistance of Carol L. Rowe and Jeffrey Wienhoff of
CW3M Company who are available to assist with providing information during today’s
proceedings. Ms. Rowe is an Illinois Licensed Professional Geologist and Mr. Wienhoff is a
Registered Professional Engineer in the State of Illinois. CW3M has been in the business of
providing consulting and contractor services for the removal of USTs and corrective action at
LUST sites since 1991. Cumulatively, personnel at CW3M have more than 65 years of
experience performing corrective action at LUST sites. CW3M currently has more than 150
active LUST sites and has obtained closure/NFR Letters at more than 70 sites.
CW3M has spent a considerable amount of time researching environmental cost data from
numerous sources and preparing testimony for these rulemaking proceedings. Our intent during
the previous hearings was to provide the Board, the Agency and other interested parties with
credible supported data to illustrate the flaws in the rates initially proposed by the Agency and
subsequently published by the Board in its l~Notice. It is most disturbing to us that the data
presented by CW3M, PIPE and other experienced consultants representing hundreds of years of
experience was largely ignored in favor of adopting the Agency’s proposal that was recognized
as based only on the Agency’s experience in reviewing reports. The Agency admitted at hearing
that Harry Chappel was the only person at JEPA who had worked in the private sector, and his
experience was for only six years. Furthermore, it is even more disturbing that the Board would
publish for First Notice the Agency’s flawed rates which were not based on any scientifically or
statistically recognized methods, especially after much of the Agency’s testimony was proven to
be incorrect. It is apparent that because the Agency and the regulated community did not
approach this rulemaking proceeding in unison, the Board felt it had no choice but to defer to
another State agency’s position, whether accurate or not. Granted, the Agency does have some
experience in reviewing budgets and payment requests, but they do not have experience in the
business of conducting or costing the planned work; nor do they have experience in anticipating
or resolving problems that could develop in the field. We believe the collective experience of
various members of PIPE, ACECI and the other participants should be taken into consideration
for “good government” to prevail in these proceedings.
A major inconsistency within the testimony and the proposed rates that has yet to be explained or
addressed is the notion that the proposed rates are consistent with the rates historically and
currently being deemed reasonable by the Agency. The Agency’s testimony indicated that the
proposed rates would be inclusive of ninety percent of the costs of sites remediated in Illinois.
• Yet, IEPA has provided no scientifically valid data to support this assertion. JEPA did not use a
2..
statistically unbiased, randomly selected data set as the bases for its various rates. As discussed
in more detail below, CW3M has provided in Appendix C a list of IDOT awarded contracts to
perform corrective action at LUST sites in Illinois.
(See
Appendix C, Table 1.) The contracts
were awarded after competitive bidding. Table 1 includes a calculation of the cost per cubic
yard to excavate, transport and dispose of impacted soil from all 39 projects. When IEPA’s
proposed $57/yd3 figure is applied, only 11 out of the 39 projects (less than 33) would be
deemed reasonable. In other words, IEPA would reject costs for more than two-thirds (2/3) of
IDOT’s sites.
Numerous professional service providers have testified that the Agency’s
proposed rates are substantially less than the rates historically deemed reasonable and reimbursed
by the Agency. If the proposed rates were reflective of the market and consistent with rates
previously deemed reasonable by the Agency, there is little doubt that these proceedings would
have been less controversial and the Agency might have secured the support ofindustry.
A related, but also contradictory statement is that the Agency felt it necessary to propose a
payment containment method to protect the Fund. However, if the proposed rates are really
consistent with current or historically approved payment amounts, where is the costs savings?
How did average rates or median costs become maximum payment amounts? When average
rates or the median is used, the maximum rate cannot account for site variability.
It is CW3M’s opinion that IEPA wants to realize a cost savings by forcing industry to accept
substantially less reimbursement than prevailing market rates or rates previously deemed
reasonable as well as forcing industry to now comply with secret or undefined scopes of work.
Now that the rate structure has been made public and the Agency and Board are unwilling to
develop detailed scopes ofwork for the lump sum payment amounts, the Agency will try to force
fit additional tasks into the lump sum rates. The Agency has refused to disclose what tasks it
included when developing the rates or what tasks should be inclusive within the lump sum
payment amounts. Either the Agency is unable to list specific tasks to include in a lump sum rate
because IEPA does not have adequate experience to know what tasks to list or, based on the
IEPA’s Responses to Pre-Filed Questions, June 14, 2005, the Agency intends that any task that
may come up or that was not previously addressed as being part of the lump sum payment
3..
amounts will later be deemed as part of the rate. CW3M believes that specific tasks should be
listed if they are to be part ofthe lump sum payment amount. Failure to do so runs the risk of the
rules being found unconstitutional and void due to vagueness.
Our interpretation of the Board’s opinion is that even though the rates may be flawed, with the
bidding and unusual circumstances contingencies the Agency’s proposed rates, where too low,
should be adjusted to market conditions. This could be plausible and possibly even acceptable,
however, the Agency has testified that there will be very few reasons for them to accept or
approve unusual or extraordinary circumstances. This is at the heart of our concerns over the
rate structure IEPA proposed.
Failure to adequately and fairly adopt rates will have little impact on how the Agency does
business. However, a poorly designed system of determining maximum rates can have a serious
impact on owners, operators and those of us providing the services. The futures of our
businesses are at stake. At one ofthe hearings, Agency witnesses tried to draw an analogy to the
problems with the health care system. Yet, the Agency’s proposed rates would create in the UST
reimbursement program the most significant problems facing health care (1) lack of adequate
insurance (which the UST Fund is) to cover necessary costs oftreatment, and (2) driving service
providers out ofthe state or to leave the profession because their high costs of doing business is
not adequately offset by the amount they get paid to allow for an adequate profit margin. In
other words, if the corrective action costs, minus the deductible, are not covered by the UST
Fund, a substantial number of sites will not get cleaned up because the owner/operator will not
be able to cover the difference between the cost of the work and the amount paid by the Fund.
An additional problem is that consultants will leave this line of work in favor of more lucrative
work.
.
“Good government” implies that any changes that could impact businesses to the level that the
proposed regulations do, should be carefully and properly evaluated rather than be based on
pulling a few non-representative files out of the cabinets and conducting a subjective review to
support rates based on only a few selective sites. Our review of the record in its entirety does not
4.
support the Agency’s proposed rate structure; there are too many holes in the process of
developing the Agency’s proposed rates and no substantial support for them.
The notion that if the rates are flawed, we have the bidding process and the “extraordinary or
unusual circumstances” provision to counteract with is also short-sided. These provisions do not
neatly cover professional consulting services for many tasks defined on a lump sum payment
basis. For example, preparation ofa 45-Day Report is not a task that is let for bid because the
information to prepare the reports is usually obtained by the consultant during the course of early
action. Requiring a different consultant to prepare a 45-Day Report than the one who did the
early action work would be extremely inefficient and more costly. When no extraordinary
circumstances exist and the costs are higher that the Agency’s average, the costs to conduct the
work are not reimbursable in whole. This is contradictory to testimony that the proposed rates
are consistent with the rates previously deemed reasonable by the Agency.
The costs for bidding individual tasks associated with professional consulting services would
drive up the costs to complete each small task. First, the primary contractor/consultant would
incur the costs ofbid preparation and letting. Any other company who bids the work would have
to build in the costs of gathering information on a new project (if it is not their site, the
consultant bidding on the work would have to review the entire project file to conduct whatever
phase ofthe project they would potentially be conducting).
All parties throughout these proceedings have used the term “reasonable”. CW3M urges the
Board to evaluate what really is “reasonable”. Are historically approved rates reasonable? Are
rates developed based on averages or medians reasonable? Is the average plus one or two
standard deviations reasonable? Is approving 90 of submittals for reimbursement of clean-up
costs reasonable? If all unit prices are within rates historically approved by the Agency, is the
grand total reasonable? If “reasonable” can be better defined, the rate structure can be
established to fairly and adequately correlated to pay “reasonable” costs.
5.
The Agency testified that the proposed rates were developed with the input of industry and are
generally consistent with the rates the Agency currently approves. Significant testimony was
presented during last year’s proceedings that only limited rates were developed with industry’s
input and when industry’s input was used for professional consulting services, the Agency
misused the information it obtained from industry because the Agency only used only portions of
the information rather than the whole and skewed the number of hours industry suggested for
certain tasks. Testimony was also presented which illustrated that the proposed rates were not
consistent with rates the Agency is currently or had historically approved; the Agency’s
proposed rates are less. Again, this suggests that the Agency’s proposed rates cannot allow for
reimbursement ofreasonable costs.
Comments on the IEPA’s
Responses to Pre-Filed Questions,
June 14,
2005
Throughout the proceedings, PIPE and others have strongly argued for the need of defined
scopes of work. Rules that do not list the tasks covered in a specific scope of work would be
vague. The consultant would not know whether a specific task is grouped with a specific scope
of work or is a separate time. and materials item. The Agency refused the request for defined
scopes of work, and the Board concurred in
1st
Notice, that scopes of work are not necessary
given the bidding and extraordinary circumstances provisions. As stated above, bidding and
extraordinary circumstances do not work for professional consulting services for lump sum tasks.
There is nothing within these regulations to prevent a LUST Project Manager from requiring
more detail or information beyond the items required for each report. The statistics on Project
Manager Responses presented by CSD in its Pre-Filed Questions for lS~Notice illustrates the
variability among Agency reviewers.
CW3M, in its experience, can submit reports or plans, identical in types of content or level of
detail and have the majority of Project Managers approve the submittal, while a select few will
always reject identical information. We are often forced to tailor submittals for certain Project
Managers. The attempt to streamline the review process is admirable, but we find nothing within
the proposed regulations that will actually make the Agency’s review standardized. The
6.
establishment ofPIPE and the forum for consultants to share information has revealed to us that
our issues with reviews are not ours alone and prevail among other consultants. There is also
variability among Project Managers in experience, education and technical backgrounds.
For these reasons, we strongly urge the Board to reconsider standardizing reviews or developing
Scopes of Work for identified tasks. Our only recourse under the proposed regulations is to
declare extraordinary circumstances, however, the Project Managers will deny the requests based
upon their personal plan denial rates, leaving us in a position of subjective decision making by
Project Managers who are not prone to approve any submittal. Appealing each of these
decisions is too costly. To bring a decision though the entire process of Hearing and Board
decision-making can exceed $50,000 per case. These are unnecessary if the regulations can be
developed to prevent subjective decision-making and, as discussed below, we have proposed
regulations that list specific tasks for various scopes ofwork.
On page 17 of the Board’s
1st
Notice, summarization of Mr. Clay’s testimony, the Agency
concludes that the review time for submittals is largely based upon the quality of the submittal.
CW3M’s experience is that the review time is based on the reviewer. We can typically expect
certain Project Managers will complete their review in very short order while others typically
complete the review near the end of the review clock. As discussed below, the statistics on
Project Manager Responses support this claim. Rather than blame consultants for poor
workmanship, the Agency should evaluate its Project Managers. CW3M has experienced
numerous plan denials on the basis ofmissing information when in fact the required information
was present. In these situations, we are required to resubmit the information or bring its location
to the attention of the Project Manager. This increases CW3M’s costs through no fault of our
own. The owner, operator and consultant should not be penalized for resubmittal costs on the
basis of Agency error. There are no provisions within the proposed rules to accommodate for
such occurrences. As indicated by the Agency on page 13 of its Pre-Filed Responses, the
maximum lump sum payment is all that is allowable regardless of how many reports are
submitted or how many times the Agency bounces back a report because the project manager
failed to adequately review the report that was submitted.
7..
Page 19 of the Agency’s Pre-Filed Responses states, “the Illinois EPA envisions that the
maximum payment amounts will encourage the submission of complete plans and reports that
‘can be approved in one submission, without the need for amendments or additional information”.
Most ofthe consultants involved in this rulemaking have been conducting LUST work for many
years and know full well what constitutes a complete plan. We have perfected our report
submittals. It is our collective experience that the approval rate is largely the result of the luck of
the draw for a Project Manager. The statistics on Project Manager Responses support this
experience given the high degree of approval/denial variability among Project Managers.
Appendix E contains data on the number of approvals and disapprovals/modifications by project
manager and was prepared by CSD and submitted to the Board, by CSD as an attachment to their
May 11, 2005 prefiled questions. CSD’s analysis shows that the overall average approval rate is
near 50 percent. However, among project managers that reviewed at least 100 submittals since
2003, the approval rate per project manager ranges from 69.46
to 25.83.
It is also
noteworthy that the project manager with the lowest approval rate (Bauer) and that the unit
manager with the lowest approval rate (Chappel) are the same persons who developed many of
the rates in IEPA’s proposed rules. Because the proposed rules do not make any renewed effort
at standardizing the Agency’s review procedures, CW3M expects that these problems will
continue.
The general theme of the Agency’s responses to questions regarding scope of work and whether
certain tasks were or were not included within a lump sum payment amount is that any additional
task should automatically be assumed to be included. For this reason, the Agency needs to
provide the list of tasks they included in each lump sum at the onset of these proceedings, not
lists they generate today or tomorrow. For example, it was clear during previous hearings that
the Agency looked at a handful of sites for 45-Day Report generation fees. When summarizing
those costs, the costs for preparing early action reimbursement claims were not included in the
proposed lump sum rates. Yet now, we are to conduct the reimbursement process under a lump
sum based on an average of 45-Day Report costs. The list of tasks included in, each lump sum
continues to grow while the pay amount remains the same. Lack Of foresight on the Agency’s
8.
part should not be a cost carried by the owner, operator nor consultant. Again, without scopes of
work or task identification, the Agency will continue along this path.
In response to the Agency’s answer to CW3M’s question #21.a., CW3M has attached in
Appendix B additional informatiOn regarding the “buddy system” required by OSHA at
hazardous waste operations. 29 CFR 1910.120. Appendix B includes a summary of this
requirement from OSHA’ s website as well as a copy ofthe OSHA standards for hazardous waste
workers and for excavation. The Agency questioned the necessity of the “buddy system” for
petroleum sites and claimed that the requirement only pertained to hazardous substances and
petroleum is not included in the definition of “hazardous substance”. Petroleum is excluded
from the definition of “hazardous substance” under CERCLA. However, petroleum products
and their constituents are regulated as “hazardous substances” under OSHA requirements.
OSHA defines the term “hazardous substance” more broadly than EPA. The OSHA definition
includes the CERCLA definition of “hazardous substance,” plus hazardous wastes regulated
under RCRA, hazardous materials regulated by the Department of Transportation and “any
biological agent and other disease-causing agent which after release into the environment and
upon exposure, ingestion, inhalation, or assimilation into any person, either directly from the
environment or indirectly by ingestion through food chains, will or may reasonably be
anticipated to cause death, disease, behavioral abnormalities, cancer, genetic mutation,
physiological malfunctions (including malfunctions in reproduction) or physical deformations in
such persons or their offspring.”
See
29 CFR 1910.120(a)(3) which provides OSHA’s
definitions for various terms used in the rule including the definitions of the terms “buddy
system” and “hazardous substance.” At 29 CFR l9lO.120(a)(1)(ii), Scope, OSHA’s rules
provided that these rules cover “Corrective actions involving cleanup operations at sites covered
by the Resource Conservation and Recovery Act ‘of 1976 (RCRA) as amended.” RCRA at 42
USC 6991b covers corrective action at petroleum LUST sites. Thus, these OSHA rules do apply
to LUST site corrective action.
Our interpretation of the “buddy system” is based on the definition (attached) of organizing
employees into work groups for rapid response. Subcontractor employees do not-train with us
9
nor are they required to meet ourjob safety requirements. One cannot assume that an equipment
operator, who is intent upon completing his own tasks and may not be able to hear over the
equipment, could watch out for all safety issues. Furthermore, OSHA’s excavation regulations at
29 CFR 1926.65 1(k) requires that a “competent person” (as defined in the rules at 29 CFR
1926.650(b)) inspect the excavation, adjacent areas, and protective systems prior to the start of
work and as needed during the shift. Ifthe Agency believes that the OSHA requirements did not
pertain to petroleum products, why then has the Agency provided OSHA training for its LUST
personnel? Simply put, the Agency is wrong to argue that OSHA rules do not apply.. As CW3M
has previously testified, two consulting personnel are required on-site for field tasks, and all rates
have been revised accordingly.
In response to the Agency’s answer to CW3M’s question #21.c., it appears the Agency’s intent is
to fix prices within the State to interrupt free enterprise ‘and force UST owners and operators to
hire the closest consultant regardless of areas of expertise, qualifications, fees, workload or other
factors owners or operators consider when hiring a consultant. CW3M requests that the Board
evaluate the legality and logic of the Agency’s position as it significantly impacts these
proceedings.
Regarding the Agency’s comments on page 30 (Answers to the Pre-Filed Questions of CSD) of
its June 14, 2005 Response, there appears to be, a contradiction in what the Agency expects for
payment requests for lump sum tasks. The June 14, 2005 Response indicates that consultants
will be required to submit invoices that identify the work performed, parties that conducted the
work and date(s) when the work was performed. However, the August 9, 2004 Hearing
transcripts, pages 109-110, indicate that only an invoice stating the task completed is being
requested for payment. Any reimbursement requests requiring greater level of detail should be
reimbursed on a time and material basis rather than just being another part of the lump sum
payment for the task. Payment requests requiring detailed breakdowns of the work require a
significantly greater amount oftime. Ifa reimbursement request is for a lump sum amount, the
request should simply state what work has been done and the amount requested and detailed
information should not be required by the Agency.
10
CW3M Company’s Proposed Amendments to the Illinois Pollution Control Board’s
1st Notice ofAmendments to 35 ILL. ADM. CODE 734 AND 35 ILL. ADM. CODE
732
CW3M presents the following discussions of its proposed modifications to the proposed
regulations. These proposed modifications are based on the collective testimony of PIPE and
other participants throughout the rulemaking proceedings. It is our understanding that numerous,
if not all PIPE members support these proposed modifications. In the
1st
Notice discussion, the
Board indicated that PIPE did not provide alternative rates; hence they relied on the Agency’s
proposed rates even though they are not statistically valid. The attached modifications include
rates presented by PIPE in last summer’s hearings. The alternative lump sum rates offered by
PIPE were based on a weighted hourly rate reflective of the type of personnel actually
conducting the work. Other rates are presented utilizing either RS Means or the National
Construction Estimator.
The following discussion highlights some ofthe most significant changes.
Section 734.100
Clarifying revisions were added to subsection (a). Subsection (d) is proposed to clarify that the
proposed rules should not be used as final rules before the rulemaking process has been
completed, which includes promulgation by the Board, approval by JCAR and publication in the
illinois Register. See
the Board decision in
illinois Ayers Oil Company v. IEPA,
PCB No. 03-
214, April 1,2004.
11,.
Section 734.135
Form and Delivery of Plans, Budgets, and Reports; Signatures and
Certification
CW3M has proposed the additional language to allow for documentation ofreports delivered by
hand or a private delivery service to the Agency. The language merely clarifies the execution
and acknowledgement of receipt.
Section 734.320(b)(2)(A), Section 734.330(a)(1)
CW3M recommends altering the language in both sections to add the word “projected” before
post-remediation use of the property. CW3M objects to the need to characterize the post-
remediation uses of the site and the surrounding properties. In limited instances, the property
owner of the UST site will know with any certainty the future use of the property. Ifthe LUST
site is an active facility and the owner or operator plans to continue fuel sales, the future use is
definable. Ifthe LUST site is a closed or soon to be closed facility and the property owner plans
to sell the real estate, the owner or operator will have no idea what the future use ofthe property
will be. Similarly, post-remediation use ofthe surrounding properties is anyone’s guess. Ifthe
entire investigation and remediation process requires several years to complete, the site
investigation characterization of the properties will likely be outdated and any projected future
use may change.
Decisions to conduct remediation or to rely upon land use or institutional controls should lie with
the property owner and not the Agency. Property owners should not be discriminated against or
disallowed remediation of their property by the Agency based on the sole potential future use of
the property. Mr. Doug Clay stated during the Agency’s testimony on March 15, 2004 that the
development of higher clean-up objectives or use of institutional controls or engineered barriers
was at the discretion of the tank and property owners. Such decisions should remain in the
property owners’ discretion.
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If off-site access or investigation is not required of an off-site property and no communication
has been established, that property owner has no reason to disclose information regarding their
property to the UST owner, operator or their professional consultant.
Providing an answer to the question of characterization of “unknown” on nearly every submittal
seems unnecessary and a waste oftime.
Section 734.340(b) Alternative Technologies
Language was added to reflect that more than one alternative technology may not always be
available. Depending upon the site-specific conditions encountered, especially geological
conditions and specific contaminants, such as lead, two additional alternatives may not always be
technically implementable. If this occurs, then only available alternatives, should be cost
compared. A listing of the alternatives considered could be provided, with explanations as to
why they were eliminated from further consideration.
Section 734.505
Review ofPlans, Budgets or Reports
Language has been added in order to attempt to eliminate the standard response ofthe Agency
which is “exceeds the minimum requirements of the Act”. Such language doesn’t provide the
owner or operator with an explanation ofthe Agency’s decision and limits the owner’s operator’s
ability to respond. With more specific language being required from the Agency, the owner or
operator should be able to provide a more focused response, and therefore, reduce the number of
additional submittals.
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Section 734.510
Standards of Review of Plans, Budgets, or Reports
This language was added in order to ensure that the Agency documents and maintains records of
theirtechnical and fiscal reviews as part ofthe record of the site.
Section 734.605
Applications for Payment
CW3M recommends striking the requirement for providing proof of payment of subcontractor
costs when requesting handling charges. The Board invited additional discussion ofthis issue in
1St
Notice. CW3M maintains that this requirement is unduly burdensome based upon the shear
number of projects, subcontractors and payments that we manage and will increase the costs to
perform the work. It is the owner or operator or prime consultant’s responsibility, and not the
Agency’s, to define terms of payment and issue payment for work satisfactorily performed.
Even with the Board’s revisions, the requirement is burdensome with no method of
reimbursement for this added cost. A proof of payment requirement may also increase the
number of reimbursement preparations and submittals to the Agency. Particularly with larger
projects during the corrective action phase of a project, reimbursement requests are made almost
immediately for some or all of the work to minimize financing costs. When corrective action
costs are carried for nearly a year, due to review and processing times and Fund balances, the
largest invoices will be submitted immediately. It is unlikely that the prime contractor will have
secured all proof of payment documents~prior to submittal of his invoice to the consultant,
requiring separate claim(s) for handling charges. Requiring proof that all subcontractors have
been paid does not help to streamline the process; it only makes it more bureaucratic.
Because the Board published for first notice subsection 734.605(j) as proposed by the Agency,
CW3M recommends revisions in order to accommodate both owners/operators experiencing
uncontrollable situations creating submittal delays and the Agency’s need to archive files and
maintain an accounting of future liabilities of the Fund. CW3M’s proposed revision provides
exemptions to the requirement that the owner/operator make all requests for reimbursement prior
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to the one-year anniversary of the No Further Remediation Letter accompanied by a reason for
the request, an anticipated timeframe for submittal and an approximate cost of the final claim.
We believe this accomplishes the intent of the Agency’s initial proposal and their reasoning for
the necessity while also allowing exceptions for rare situations, which would limit the owner or
operators’ ability to meet the one-year deadline.
As stated in previous testimony, the proposed submittal limitation may cause severe hardship for
owners or operators or their beneficiaries. As has been CW3M’s experience on a few cases,
Illinois Pollution Control Board appeals may be pending and settlement negotiations are in
progress. There is no incentive for the Agency to expedite the process and final disposition of a
case can exceed one year. In such a circumstance, the owner or operator would be prevented
from submittal ofa claim until the appeal is settled or reaches a decision by the Board.
Should an Owner or operator submit a plan or budget, which is rejected by the Agency and deems
an appeal is its best course of action, the time to reach settlement or a decision by the Board may
extend beyond the timeframe for ‘allowance of submittal’ for an application for payment
(following approval of the budget).
For 731 sites (where no budget is in place), the Agency has historically utilized the general
review and payment guidelines for 732 sites, except for the 120-day review clock. If the review
process exceeds one year, as it often does, and some costs are denied or resubmittal is required,
the owner or operator would not have the opportunity to do so within the time constraints of
734.605(j).
An owner or operator’s incapacitation, illness, inaccessibility, bankruptcy or even death can
cause delays in submittal offinal plans, budgets or requests for payment.
The owner or operator could delay submittal of the Corrective Action Completion Report if they
foresee delays in finalizing plans or payment submittals or approvals, however, unexpected
illnesses, for example, cannot be planned. If a final budget and CACR are submitted at the same
15.•.
time and the Agency rejects the budget, they could not plan for such a scenario and would not
have sufficient time to negotiate a settlement or move through the entire appeal process within
one year.
Section 734.625
Eligible Costs.
As noted by the Board, governmental fees are often unavoidable and may be necessary
corrective action costs. Accordingly, payment of such fees has been added to this listing of
eligible costs. Likewise, consultant’s costs to prepare reimbursement packages are listed as an
eligible cost.
There was considerable debate regarding the need and payment for compaction. CW3M
recommends the addition of compaction costs as an eligible corrective cost. Completing
compaction during the backfill process returns the site to one with a stable foundation suitable
for redevelopment and avoids multiple trips back to the site to provide additional materials and
grading where the excavation has settled. The subsurface should be returned to a condition
similar to the pre-excavation condition. Thus, compaction should be an eligible expense.
CW3M has added to the list of eligible costs a specific provision for payment ofhandling charges
incurred by the prime contractor for field and other direct expenses, other than subcontractors.
Payment of handling charges for field and other expenses would require documentation of the
expense incurred.
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Section 734.630 Ineligible Costs
Section 734.63 0(gg) has been revised to include costs incurred by a Highway Authority
Agreement after issuance of the No Further Remediation Letter. They would have been eligible
costs if incurred prior to site closure. The owner or operator is placed in a no win situation with
regards to costs invoked under a Highway Authority Agreement. The highway authority would
not allow remediation beneath a roadway or possibly even within the right-of-way during the
active correction phase of the project, when the costs would be reimbursable. However, if the
highway authority incurs corrective action costs after closure, the owner or operator is expected
to reimburse the highway authority.
Proposed section 734.63 0(gg) has been revised to include costs incurred as result of necessary
corrective action measures being conducted after closure as a result of unknown contamination,
migratory pathways or properties for which access had previously been denied. With the
Agency’s push to leave contamination in place to preserve the Fund, even modeling may fail
when there are unknown migratory pathways; Properties can change ownership; a previous
owner’s denial may be unacceptable to a new owner. Off-site contamination may not have been
predictable or modeling indicated such property would not be affected, hence, never
investigated. Off-site construction or other activities could identify contamination that was not
previously investigated or was missed during the investigation due to the impracticality of
investigating every cubic foot of a site. In such cases, the contamination should be eligible for
investigation and remediation under the provisions ofthe Act and the Fund.
Proposed section 734.630(gg) was also revised to include costs for remediation needed to
reinstate or obtain a new NFR Letter after a prior NFR Letter was voided by IEPA due to no
fault ofthe property owner. Two situations, which track conditions under which an NFR Letter
17.
could become void, are described: (1) the subsequent discovery of contaminants, and (2) where
an IEPA approved plan to leave contaminants in place failed and the contamination poses a
threat to human health or the environment.
CW3M recommends deletion of Section 734.630(oo). Considerable testimony was presented
during the 2004 hearings regarding this issue and the Board invited additional discussion and
deliberation of this issue. The Board indicated that the record to date did not have sufficient
information to determine if the costs of securing a subcontractor with or without financial
interest were the same.
Based on the definition of financial,interest, ownership of the subcontractor could be entirely the
same as the prime or could have a minority ownership or have ties via employees. The only
factor of the definition of handling charges that may reduce the amount ofcosts incurred by the
prime contractor is procurement. There are, however, procurement costs associated with hiring a
subcontractor even if the prime has a financial interest. The subcontractor will likely conduct
work for many other businesses or contractors and time will be spent securing and scheduling the
work. The remaining factors identified in the definition ofhandling charge are not reduced if the
prime has a financial interest in the subcontractor. Insurance, interest, administrative, oversight
and payment costs will remain.
Our insurance companies assess rates based on gross sales and we receive no discount for a
financial interest in a subcontractor. Banks charge us interest at a single rate that is not adjusted
if part of the costs is incurred by subcontractors with whom there is a financial interest. Further,
banks do not decrease their interest rates based on the amounts we borrow as the handling charge
sliding scale would suggest.
The administrative costs are not less for the prime if the
subcontractor has shared interest. Each entity functions as a separate company and incurs the
18
same costs of management as would separately held companies, such as personnel, accounting,
overhead, taxes, etc.
Section 734.630(ccc) has been eliminated for the following reasons. In 35 IAC 620.260
Reclass~flcationof Groundwater by Adjusted Standard
it is clear that the IEPA and the IPCB
recognize that changing groundwater standards can affect, among other environmental and
economic standards, property values. The IEPA did not consider the affect on both on-site and
off-site property values for sites where IEPA forces the property owner to leave contamination in
place by not reimbursing clean-up costs when a groundwater ordinance is in place. This could
have a major affect on a property owner. A tanklproperty owner should be able to have the
option ofremediating the contamination with the Fund that they paid into to keep their property
value up instead ofbeing forced to incur a loss of property value by the State ofIllinois.
Section 734.665
Audits and Access to Records; Record Retention
CW3M is providing additional testimony regarding auditing and offers revised language for this
Part in order to assure that the Agency does not exceed its statutory authority and conducts such
audits consistently with other Agency programs.
CW3M does not disagree that the Agency has statutory audit authority, however, we contest
extending that authority beyond the Act and the entities regulated by the Act and this Part. The
audit authority was initially granted to allow the Agency to review only portions of the plans and
reports submitted to them rather than be required to review all plans. Hence, the LUST Section
would audit reports submitted instead of conducting a full technical review of each plan. The
Agency has attempted to broaden its authority beyond the original intent of the Act. The Agency
19.
has further attempted to broaden its authority to attempt to regulate entities not otherwise
regulated by the Act or this Part. This Part regulates owners and operators of underground
storage tanks, not professional engineers and geologists.
As CW3M previously testified, audits of records of Licensed Professional Engineers or
Geologists also violate client-privileged information. CW3M, as well as the majority of
consultants maintains confidentiality agreements with its clients. Open, unrestricted audits
violate such confidentiality. Section 1252.1 l0(a)(6) of the Rules for Administration of the
Professional Geologist Licensing Act Part 1252 prohibits the Licensed Professional Geologist
from disclosing information concerning the lawful business affairs or technical processes of a
client or employer. Thus, as currently drafted language in the Board’s ~ Notice violates another
act and other State regulations.
The proposed revised language is presented in an attempt to provide the Agency with the
information it has indicated it needs but also conforms with other document review procedures,
such as the Freedom of Information Act (FOIA) and audit procedures already conducted by the
Agency, such as the landfill auditing program to evaluate fee collection and payment. The
Agency conducts the review at the site of the regulated entity or its documentation center, not at
its consultant or attorney’s office. The FOIA process allows the Agency time to review and
screen a file for sensitive or privileged information prior to making it available to the public.
The Agency also requires a request in writing and makes scheduling arrangements for its review.
The regulated community should be afforded the same rights to its files and documents.
SUBPART
H:
PAYMENT AMOUNTS
The language regarding the applicability and other minor language changes throughout have
been revised in a manner that we feel more accurately reflects the testimony regarding how the
Agency intends to apply Subpart H and what the members of PIPE feel is appropriate for the
20.
application of this Section. The revised proposed costs are based on costs actually experienced
by PIPE members based on their aggregate experience of hundreds of person years, IDOT
competitively bid projects, and/or published numbers from R.S. Means or the National
Construction Estimator. Each ofthe changes not specifically explained in the following changes
has either been previously explained by PIPE as an organization or is explained by another PIPE
member in these hearings.
Section 734.810
UST Removal or Abandonment Costs
The pricing the Agency provided is now outdated, considering the recent revisions to the Office
of the Illinois State Fire Marshal regulations, which were enacted in 2003. Among the items
within the new regulations are the requirement for additional safety equipment (full-face mask
supplied air to enter a tank), and the removal of all product piping as part of a tank removal.
Additionally, the Agency apparently collected cost information for removing tanks without
regard for whether or not there was a release. Costs for a tank removal if a release did not occur
is lower than the cost for removing a tank with a release, due to reduced worker productivity
because of safety restrictions and additional time required for sampling.
Section 734.820
Drilling, Well Installation, and Well Abandonment
Mobilization for a drilling
contractor has been
a standard charge throughout the history of the
LUST program and continues to be standard for drilling contractors in other environmental
fields. A drilling contractor has to bring a drill rig and a support truck to the site in order to
complete the task. Therefore, at a minimum they should be allowed the same travel expenses as
professional consulting personnel if not additional expenses.
Larger equipment is less
economical to move than passenger vehicles.
‘
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Section 734.825
Soil Removal and Disposal
The suggested “fluff factor” and conversion rate are more typical values for Illinois than those
suggested by the Agency, as was debated during the first round of hearings. The Agency’s
mystical “fluff factor” and the conversion rate from tons to cubic yards could be debated
endlessly. The fact is, materials vary significantly in unit weight and in the amount they “fluff’
when excavated. To simplify all soils and backfill materials found in Illinois into single
universal rates is almost impossible. The Agency has selected each factor to cause minimum
expense to the Fund. The Agency’s conversion factor, the “fluff factor” and the unit rates for
disposal and backfill are each within the appropriate range for Illinois, however each is at an end
of the scale, the end that would create minimum costs. Together, they form the absolute
minimum that could be paid out, instead of a reasonable rate.,
As a suggestion, eliminate the “fluff factor” by multiplying the unit rate by a percentage (105
to 120),
and eliminate the conversion factor by basing the costs purely on the size of the
excavation. For early action, only allow for up to 4 feet’beyond the tanks, in an amount not to
exceed Length X Width X Depth minus the volume ofthe tank(s) in a cubic yard basis. This
eliminates the games played with the “fluff factor” and the conversion factor.
The Agency has presented no viable evidence on the reasonableness ofthe $57.00 rate. The data
presented by JEPA in Attachment 9 to Chappel’s prefiled testimony is. not scientifically
defensible because it was not statistically derived and it is based on outdated information. When
questioned about the source of$57 rate, the response was merely that this is a number that IEPA
personnel think should be used.
CW3M has and is presenting data from Illinois sites, based upon actual contracts let by the
Illinois Department of Transportation, after competitive bidding, which show that IEPA’s
numbers for excavation, transportation and disposal of contaminated soil are substantially less
than they should be. Attached, in Appendix C, in Table 1, is a compilation of the Illinois
Department of Transportation (IDOT) bid results, which have become available since the
22
submittal, of CW3M’s prior testimony. The average from IDOT for excavation, transportation
and disposal of impacted soil for the period is $119.42, up from the prior figure of $99.75.
Although the Agency has attempted to discredit the IDOT information, the data obtained and
presented from IDOT clearly demonstrates that the IEPA’s proposed rate is too low. As
discussed above, if IEPA’s proposed rate is applied to the IDOT data, IEPA would determine
that the costs are reasonable at only 11 out of39 sites. This is a far cry from the 90 ofsites that
the Agency said it intended to cover.
The Agency had IDOT testify that the data was not to be taken by itself, but was part ofa larger
contract. This point is irrelevant and ignores the fact that the bids were given competitively by
contractors who hoped to win the bid and the fact that the numbers reflect the winning bid, which
presumably was the lowest bid. There is no difference between the Agency’s methodology in
developing and verifying the rates and CW3M’s methodology of developing rates based on the
IDOT data, except forthe following:
• The IDOT data is more current
• The IDOT data demonstrates the extreme variability in costs to conduct excavation and
disposal at sites due to the variable conditions between sites
• The IDOT data set is more robust and scientifically defendable (all data points are listed,
but the two extreme data points were not included in the calculations.)
• The IDOT data is for the entire subset of work necessary to accomplish the task, not just
what the Agency interprets needs to be included.
• The IDOT data was the result ofcompetitive bidding in all cases.
• The IDOT data represented a wider geographic mix than the Agency dataset
• The IDOT data was for the specific task at hand, which included a well-defined scope of
work
While CW3M believes that, due to the high degree of variability between sites, the costs to
excavate, transport and dispose of contaminated soil and other material and the costs for
purchase, transportation and placement of clean fill should be based on time and materials.
However, CW3M is proposing that a value of $74/yd3 be considered reasonable to excavate,
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transport and dispose of impacted soil and that a rate of $26/yd3 be used for backfill. The $74
number was derived from IDOT’s data set by first eliminating both the lowest ($2.95) and
highest ($1475) values and then calculating a per cubic yard weighted mean ($50.69) and
weighted standard deviation ($23.53). The volume of soil excavated was the factor used to
weight the data. Then, similar to IEPA’s methodology, the weighted mean and weighted
standard deviation were added together to get $74.22. The methodology used is explained
further in Attachment C. Applying the rate of$74/yd3 to the list of IDOT sites results in only 21
out of 39 sites (54) falling within the “reasonable rate.” CW3M proposes that bidding be used
for sites where costs to excavate, transport and dispose of soil exceed $74/yd3 and where costs to
purchase, transport and place backfill exceed $26/yd. Doing so would allow rapid approval for
sites that are below these amounts and flexibility for sites where the costs cannot be met due to
the site being in a remote location or for some other valid reason. Allowing the more ‘realistic
costs of $74/yd3 and $26/ yd3 would reduce the number of sites where bidding would be
necessary, resulting in lower overall project costs. CW3M also believes that the $74/yd3 and
$26/yd3 rates are more realistic because the unit rates will now include a number ofactivities that
the Agency used to reimburse separately when it first started using the rates of $55/yd3 and
$20/yd3. Activities that the Agency used to reimburse as separate line items included but were
not limited to mobilization, field preparation, utilities location, landfill authorization, crew travel
allowance, scheduling, and preparing, purchasing and tracking manifests.
The Agency presented testimony on the $6.50 per cubic yard figure was for the excavator to
excavate soils from the hole and set them aside. This amount does not cover a situation where
the site does not have adequate room for this type of operation. Therefore, the proposed rules
need to account for instances in which the clean soil needs to be temporarily‘transported off the
site or to a remote area of the site for stockpiling. This proposed amount has been calculated
using the Agency’s logic in calculating the fluff factor. Mr. Harry Chappel previously stated that
transportation is roughly 25
of the $57/yd3 for excavation, transportation and disposal. So
25
of $57, or $14.25/yd3 should be ad’ded to the $6.50/yd3 cost to stockpile soil when the soil
cannot be stockpiled next to the excavation. The $l4.25/yd3 figure includes both moving the soil
to the stockpile locationand returning it to the excavation.
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Section 734.830
Drum Disposal
The word non-hazardous has been added in order to more clearly define the situation in which
the costs are appropriate. Drums containing hazardous wastes are much more expensive to
dispose ofand while hazardous wastes are rare at LUST sites, there are occasions where it arises.
A mobilization fee for the drum disposal contractor is also included in this section. The same
justifications as for the drilling contractor are applicable.
Section 734.840
Concrete, Asphalt, and Paving; Destruction or Dismantling and
Reassembly ofAbove Grade Structures
CW3M’s prior testimony demonstrated the numerous flaws, each ofwhich lowered the proposed
rate, in the Agency’s calculation of its rates and that the agency improperly took rates from the,
National Construction Estimator. The rates provided in CW3M’s proposal are consistent with
prevailing rates, and include
all
work and oversight necessary to complete the task.
Section 734.840
Professional Consulting Services
The proposed report preparation numbers were the subject of testimony. The method of their
calculation was thoroughly explained in previous testimony by PIPE. To reiterate, the values
proposed here were calculated using the same total number hours to prepare reports as the IEPA
used, however, the hours were broken down into a more realistic distribution of the type of
personnel who work on the project. We used the same hourly personnel rates from Subpart H, as
IEPA used, to perform the calculations for the proposed lump sum payments for various
consulting services. Thus, the rates proposed in this submittal more accurately reflects the costs
and distribution ofwork to complete these reports.
25
.
As discussed in more detail elsewhere, CW3M has demonstrated that OSHA rules apply to work
at LUST sites. Therefore, two consulting personnel are required for a majority of the tasks
provided for in Subpart H. Therefore, the half-day rate and travel rates should properly reflect
the necessity for two people to complete the work.
Additionally, the proposed travel rates have been revised to include distances further from a site.
In the Agency’s responses they indicated that if a an owner or operator chooses to hire a
consultant farther from their office, that is their decision to pay the extra travel costs. An owner
or operator should be able to choose a consultant based upon that firm’s qualifications and the
services which the consultant can provide and should not be limited to consultants within a 60
mile range of each site. Furthermore, in
City of Roodhouse v. IEPA,
PCB No. 92-11, Sept. 17,
1992, the Board found that a consultant’s travel costs were reasonable corrective action costs
even though the consultant traveled from Kansas City. Capping travel costs to mileage within 60
miles also limits the choices of large oil companies which have sites across the state. Why should
the company be forced into hiring a different consultant for each site when it could use one with
which it already has a comfort level and rapport.
Determination of the rate of movement ofthe groundwater at a site is a technical requirement of•
the proposed First Notice. However, the currently proposed Subpart H does not allow for
payment for determination of this value. As a slug test typically takes one half-day to complete,
it is proposed to incorporate one half-day for each time during the site investigation process that
a hydraulic conductivity test is required.
The original proposal by the IEPA was for a half—day to equal 5 hours and their calculations
showed that 250 yd3 could be excavated in a typical half-day. However they have currently
reduced a half-day to 4 hours. Therefore, the volumes which can be excavated should be
reduced by a similar ratio to 200 yd3.
26.
The other consulting tasks listed are tasks that are required at a LUST site but for which no
allowance is made in Subpart H. Therefore, to ensure these tasks remain reimbursable they have
been listed in this Section.
This concludes my prepared testimony.
Dated: July 8, 2005
Respectfully’submitted,
CW3M Company
By:
________________________
27838
lv 1
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