BEFORE THE
ILLINOIS
POLLUTION CONTROL
BOARD
PEOPLE
OF THE
STATE
OF ILLINOIS,
)
)
Complainant,
)
)
vs.
)
No. PCB 04-16
)
(Enforcement
— Air)
PACKAGiNG
PERSONIFIED,
INC., an Illinois
)
corporation,
)
)
Respondent.
)
NOTICE OF ELECTRONIC
FILING
PLEASE
TAKE NOTICE that
on the
25
th
day
of September,
2009,
Complainant
filed its
Closing
Argument
and Post-Hearing Brief
with the Clerk of the
Illinois
Pollution
Control
Board
by
electronic filing,
a
true
and correct
copy
of which
is
attached
and herewith served
upon you.
PEOPLE
OF THE
STATE OF ILLINOIS,
LISA MADIGAN,
Attorney
General
of the State of Illinois
By:
PAULA BECKER WHEELER
Assistant
Attorney General
L.
Nichole Cunningham,
AAG
Paula
Becker
Wheeler,
AAG
Christopher
Grant, AAG
Environmental
Bureau
69 W. Washington,
Suite 1800
Chicago, Illinois 60602
(312)
814-3532
(312)
814-1511
CERTIFICATE
OF
SER VICE
I,
PAULA
BECKER WHEELER,
an attorney,
do
certify
that
I
caused
to
be
served
this 25th
day of September,
2009, the
foregoing
Closing
Argument and
Post-Hearing Brief
and Notice of
Electronic Filing
upon the persons
listed
below,
by hand delivery,
and by placing
same
in an
envelope
bearing sufficient
postage with the
United
States
Postal
Service
located
at 100
W.
Randolph,
Chicago, Illinois.
PA ULA BECKER
WHEELER
Mr. Bradley
P.
Halloran
Hearing Officer
Illinois Pollution Control
Board
100 W.
Randolph
Chicago,
IL 60601
Mr. Roy M. Harsch
Ms.
Yesenia Villasenor-Rodriguez
Drinker Biddle
&
Reath
LLP
191
North Wacker
Drive,
Suite 3700
Chicago, IL
60606
2
BEFORE
THE
ILLINOIS
POLLUTION
CONTROL
BOARD
PEOPLE
OF
THE
STATE
OF
ILLINOIS,
)
)
Complainant,
)
)
)
v.
)
PCBO4-016
)
(Enforcement
-
Air)
)
PACKAGING
PERSONIFIED,
INC., an
)
Illinois
corporation,
)
)
Respondent.
)
COMPLAINANT’S
CLOSING
ARGUMENT
AND
POST-HEARING
BRIEF
NOW
COMES
Complainant,
PEOPLE
OF
THE
STATE
OF
ILLINOIS,
by
LISA
MADIGAN,
Attorney
General
of the
State
of
Illinois,
and
hereby
presents
its
Closing
Argument
and
Post-Hearing
Brief.
I.
INTRODUCTION
On
June
29
th
and
2009,
a
hearing
was
held
to
determine
liability
and
to
set
a
civil
penalty
for
the
violations
alleged
by
the
State
in the
People’s
First
Amended
Complaint
filed
on
July
5,
2005,
and
accepted
as
filed
by
the
Hearing
Officer
on
August
18,
2005,
in
the
above-captioned
matter,
(hereinafter,
“Amended
Complaint”).
The
Amended
Complaint
incorporated
all
of
the
violations
alleged
in
the
original
complaint
filed
on
December
9,
2002,
and
added
several
alleged
permit
violations.
The
People’s
Amended
Complaint
alleges air
pollution
violations
at
Respondent’s
facility
located
at
246
Kehoe
Boulevard,
Carol
Stream,
DuPage
County
(“Facility”).
The
violations
include
the
failure
to
obtain
required
permits,
operating
without
a
permit,
failure
to
comply
with
recordkeeping
and
reporting
requirements,
failure
to
comply
with
Illinois
Pollution
I
Electronic Filing - Received, Clerk's Office, September 24, 2009
Control
Board’s
(“Board”)
flexographic
printing
regulations,
and
violations
of the
New
Source
Review
and
Emissions
Reduction
Market
System programs.
The
evidence
presented
to
the Board
at
the
hearing
shows
clearly
that
the
Respondent violated
the
Illinois
Environmental
Protection
Act
(“Act”)’
as alleged
by
the
People.
The
facts
further
showed
that
the
duration
and
gravity
of the
violations
were
significant
and
that
the
Respondent
obtained
a
significant
economic
benefit,
warranting
a substantial
civil
penalty.
II.
SUMMARY
OF
THE
RELIEF
SOUGHT
BY
COMPLAINANT
Complainant
seeks
a finding
of
liability
on Counts
I through
X
and
Count
XII
of
the
Amended
Complaint;
an
order
requiring
Respondent
to
cease
and
desist
from
future
violations
of the
Act
and
Board
Regulations;
and
an
assessment
of
a civil
penalty
in
the
amount
of
at
least
$861,274.00.
III.
THEEVIDENCE
ESTABLISHES
THE
VIOLATIONS
ALLEGED
IN
THE
PEOPLE’S
AMENDED
COMPLAINT
A.
Packaging
Constructed
Emissions
Sources
Without
a
Permit
(Count
1)
The
Act
and
the
Board
Air
Pollution
Regulations
prohibit
any
person
from
constructing
any
source
that
causes
or is
capable
of
causing
air
pollution
in the
State
of
Illinois
without
a
permit
granted
by
the
Illinois
Environmental
Protection
Agency
(“Illinois
EPA”).
2
Since
at
least
1989,
Packaging
Personified,
Inc.
(“Packaging”)
has
been
constructing
sources
that
release
volatile
organic
material
(“VOM”)
into
the
atmosphere
— the
emissions
sources
include
two
extruders
constructed
prior
to
1992,
one
extruder
and
two
flexographic
printing
presses
constructed
in
1992,
one
extruder
and
two
‘415
ILCS
5/1
etseq.
2415
ILCS
5/9(b)
(2008)
and
35
Iii.
Adm.
Code
201142.
2
Electronic Filing - Received, Clerk's Office, September 24, 2009
flexographic
printing
presses
constructed
in
1995,
and
one flexographic printing
press
constructed
in
2003. Packaging
admits
that
all
four
extruders,
and
four of
the
five
printing
presses,
were
constructed
without
a
permit
from the
Illinois
EPA.
4
Although
extruders
are
currently
exempted
from the
permit
requirement
pursuant
to
Section
201.146(cc)
of
the
Board’s
Air
Pollution
Regulations,
this
exemption
did
not
exist
at
the
time
the extruders
at
the
Facility
were
constructed.
5
Based
on
the
evidence,
Packaging
failed
to
obtain construction
permits
as
required,
and
thereby
violated
415
ILCS
5/9(b)
and
35
Iii.
Adm.
Code
201.142.
B.
Packaging
Operated
Emissions
Sources
Without
a
Permit
(Count
II)
The
Act
and
the
Board
Air
Pollution
Regulations
also
prohibit
any person
from
operating
a
source
that
causes
or
is
capable
of
causing
or
contributing
to
air
pollution
without
a
permit granted
by
the
Illinois
EPA.
6
Each
of
the
units
constructed
without
a
permit,
four
extruders
and four
of
the
five
printing
presses,
were
thereafter
operated
without
permits
from
Illinois
EPA
after
their
construction.
7
These
emissions
sources
were
operated
from
seven
to
more
than
ten
years
withoutany
application
for
coverage
under
an
Illinois
EPA operating
permit.
8
Respondent
admits
that
in
July
2002
it
submitted
its
first
application
for
an
operating
permit
to
the
Agency
for
the
unpermitted
extruders
and
printing
presses.
9
Based
on
the
evidence,
Packaging
failed
to
timely
obtain
operating
permits
as
required,
and
thereby violated
415
1LCS
5/9(b) and
35
III.
Adm.
Code 201.143.
Answer
to
Amended
Complaint,
Count
I,
par.
6,
and
Complainant’s
Exhibit
5,
Admitted
Fact
Nos.
I
-
14.
Complainant’s
Exhibit
5,
Admitted
Fact
Nos.
2,4,
6,
8,
10,
12
and
14.
35
Ill.
Adm.
Code
201.146.
6415
ILCS
5/9(b)
(2008)
and
35
111.
Adm.
Code
201.143.
to
Amended
Complaint,
Count
II,
par.
18,
and
Complainant’s
Exhibit
5,
Admitted
Fact
8
22.
Answer
to
Amended
Complaint,
Count
II,
par.
18
(stating
“Packaging
admits
that
on
or
around
from
1989
to
July
2,
2002,
it
operated
four
presses
and
four
extruders
without
obtaining
an
operating
permit”).
Complainant’s
Exhibit
5,
Admitted
Fact
No.
18.
3
C.
Packaging
Failed
to
Timely
Submit
Annual
Emissions
Reports
(Count
III)
The
Board
Air
Pollution Regulations
also
require
that
any
person
owning
or
operating
any
emissions
source
or
air
pollution
control
unit
within
the
State
of Illinois
submit
an
annual
report
detailing
the
nature
and
quantity
of
the
air
emissions
from
those
sources.’
0
Packaging
is subject
to
the
regulation
as
an
owner
and
operator
of
a
stationary
source
that
emits
the
air
pollutant
VOM.
Packaging
admits
that
it
did
not
submit
Annual
Emission
Reports
(“AERs”)
to
the
Illinois
EPA
for
the
years
1992,
1993,
1994,
1995,
1996,
1997,
1998,
1999,
2000
and
2001
until
August
8, 2002.”
Based
on
the
evidence,
Packaging
failed
to
timely
submit
AERs
as
required,
and
thereby
violated
415
ILCS
5/9(a)
(2008)
and
35
III. Adm.
Code
201.302(a).
D.
Packaging
Operated
a
Major
Stationary
Source
Without
a
CAAPP
Permit
(Count
IV)
The
Illinois
EPA
has
been
delegated
the authority
to
implement
the
federal
permitting
requirements
developed
pursuant
to Title
V
of
the
Clean
Air
Act
and
incorporated
into
Illinois
law
as the
Clean
Air
Act
Permit
Program
(“CAAPP”)
through
Section
39.5
of
the
Act.’
2
Under
the
CAAPP,
no
person
may
operate
a
major
source
of
air
pollutants
without
a CAAPP
permit.
For
a
source
emitting
VOM,
a major
source
is
defined as
any
source
with
the potential
to
emit
(“PTE”)
100
tons
or
more
per
year
of
VOM
in
areas
classified
as
marginal
or
moderate,
50 tons
or
more
per year
in
areas
classified
as
serious,
and
25
tons
or
more
per
year
of
VOM
in an
area
designated
severe
1035
Iii.
Adm.
Code
201.302(a).
12
Answer
to
Amended
Complaint,
Count
III,
par.
12,
and
Complainant’s
Exhibit
5,
Admitted
Fact
No.
22.
415
ILCS
5/39.5
(2008),
4
nonattainment
for
ozone)
3
DuPage
County,
where
the
Facility
is
located, was
designated
as
severe nonattainment
for
ozone
during
the
period
when
the
violations
occurred.’
4
In
1992, Packaging
added
one
extruder
and
Presses
I
and
4
to
the
two
extruders
already
in
operation
at
the
Facility.’
5
Thereafter,
Packaging
operated
three
extruders
and
two
printing
lines)
6
The
PTE
of the
press
designated
“Press
4”
was
52
tons
per
year
of
VOM.’
7
From
the
date
of
the
installation
of
Press
4
in
1992,
Packaging’s
Facility
had
the
potential
to
emit
more
than
25
tons
per
year
or
more
of
VOM
and
qualified
as
a
major
source.
As
a
major
source,
it
was
required
to
apply
for
a CAAPP
permit
no
later
than
September
7,
1996.
Packaging
admits that
it
did
not
apply
for
a CAAPP
permit
until
July
2,
2002,
and
that
it
continues
to
operate
without
the
requisite
permit.’
Based
on
the
evidence,
Packaging
operated
a major source
of
VOM
in
a
severe
nonattainment
area
for
ozone without
a
CAAPP
permit
in
violation
of
Section
39.5(6)(b)
of
the
Act.
E.
Packaging
Violated
New
Source
Review
Requirements
(Count
V)
The
State
of
Illinois
has
delegation
authority
to
enforce
the
federal
New
Source
Review
requirements.
Pursuant
to
this
authority,
the
Board
promulgated
standards
applicable
to
the
construction
and
modification
of
major
stationary
sources
of
regulated
air
pollutants
(“Major
Stationary
Source
Regulations”).’
9
The
Board’s
Major
Stationary
Source Regulations
prohibit
any
person
from
constructing
a major
modification
or
constructing
a new
major
stationary
source
without
complying
with
lowest
achievable
‘
415
ILCS
5/39.5(2)(a)
and
(c)
(2008).
‘
Hearing
Transcript,
June
29,
2009,
at
p.
42.
Answer
to
Amended
Complaint,
Count
I,
par.
6.
16
Id.
at
Count
II,
par.
18.
17
Id.
at
Count
V,
par.
19.
Complainant’s
Exhibit
5,
Admitted
Facts
No.
17
and
18.
35
Iii.
Adm.
Code,
Part
203.
5
Electronic Filing - Received, Clerk's Office, September 24, 2009
emission rate
(“LAER”)
requirements.
2
°
A
new
major
stationary source,
for
an area
classified
as
severe
ozone
nonattainment,
is
defined
as
any building,
structure,
facility
or
installation
that emits
25
tons
or more
per
year
of
VOM.
21
A major
modification
is
defined
as
any
change
that
would
result
in a significant
net
emissions
increase
of
a
pollutant
for
which
the
area is
in nonattainment.
22
In
an
area
designated
severe
nonattainment
for ozone,
a
significant
net emissions
increase
occurs
when
the
net
VOM
emissions
increase
is
25 tons
or
more
in actual
emissions
when
aggregated
over
a 5
year
period.
23
The
provision
became
effective
November
15,
1992.24
Between
1992
and 1995,
Packaging
installed
two
extruders
and
four
printing
presses.
25
On
July
2, 2002,
Packaging
submitted
a CAAPP
application
to
the
Illinois
EPA
containing
emissions
information
on
the
equipment
at the
Facility;
the
application
was
certified
to
be
“b-ue,
accurate
and
complete”
by
Dominic
Imburgia,
President
of
Packaging
Personified.
26
The
permit
application
requires
a
facility
to
identify
both
maximum
and
typical
emissions
from
a
facility.
Based
on
Packaging’s
CAPP
permit
application, the
typical
emissions
of
the
units
at the
Facility
were
as
follows:
1.08
tons
per
year
(“tpy”)
of VOM
for Presses
1
and
2;
18.9 tpy
VOM
for
Press
4;
and
44.2
py
VOM
for Press
527
Additionally,
on page
1.1-5
of
CAAPP
Form
200,
Packaging
represented
that
actual
emissions
of the
source
were
not
below
the
applicability
levels
for
a CAAPP
permit
and
the
source
would
not
be requesting
a federally
enforceable
state
2035
Iii.
Adm.
Code 203.601.
2!
415 ILCS
5/39.5(1)
and (2)(c)(iii)(A).
22
Adm.
Code
203.207.
23
IlL Adm.
Code
203.209.
24
Id.
25
Answer
to
Amended
Complaint,
Count
I, par.
6.
26
Complainant’s
Exhibit
9,
Application
for
CAAPP
Permit,
page
1.1-5.
27
Id. atpages
2.1-Il,
3.1-11
and4.1-ll.
6
Electronic Filing - Received, Clerk's Office, September 24, 2009
operating permit.
28
Based
on
the
calculations
submitted
and
certified
by
Respondent,
the
actual aggregated
VOM
emissions
of Packaging’s
printing
equipment
exceeded
the
25
tons
per year
threshold
once
all
four
presses
were
operating
at
the
Facility. By
1995
the
source
qualified
as
a new
major
source.
As
such,
Respondent
was
required
to
submit
a
construction
permit
application
demonstrating
LAER
prior
to the
construction
of Presses
2
and
5
in
1995.
Packaging
admitted
that
it
did not
evaluate
LAER
for Presses
2
and 5;
did
not
make
a LAER
demonstration
to
the Illinois
EPA
prior
to constructing
Presses
2
and
5;
and did
not
achieve
LAER
on Presses
2
and
29
By
failing
to
take
these
required
actions,
Respondent
violated
the
Act
and
the
Board’s
Major
Stationary
Source
Regulations,
as
well
as federal
New
Source
Review
requirements.
F.
Packaging
Failed
to
Participate
in
Illinois’
Emissions
Reduction
Market
System
(Count
VI)
In
1997,
the
Board
adopted
the
Emissions
Reduction
Market
System
(“ERMS”),
a
cap-and-trade
system
for
VOM
emissions
units
in
the
Chicago
ozone
nonattainment
area,
which
includes
DuPage
County.
3
°
The
ERMS
program
required
all
existing
sources
of
VOM
emissions
in the
Chicago
ozone
nonattainment
area
meeting
the
applicability
requirements
to register
to
participate
in
the
ERMS
program
by
March
1, l998.’
Each
participating
source
is
required
to submit
seasonal
emissions
reports
(“SERs”)
as part
of
their
annual
reporting
to
the
Illinois
EPA
and
to
hold
allotment
trading
units
(“ATUs”)
in
an
amount
not less
than
the
source’s
actual
VOM
emissions
during
each
seasonal
allotment period.
Sources
that
emit
more
VOM
than
they
hold
ATUs
for
are
required
to
28
ldatpage
1.1-5.
29
Complainant’s
Exhibit
5, Admitted
Facts
No.
26 —
28.
°
35
III.
Adm.
Code
205.130
(defining
“Chicago
ozone
nonattainment
area”).
‘
35
Iii.
Adm.
Code
205.3
10.
7
Electronic Filing - Received, Clerk's Office, September 24, 2009
purchase ATUs
from
the
market
or
the
Illinois
EPA’s Alternative
Compliance
Market
Account
(“ACMA”).
32
At
the
time
the
Packaging
Facility
was
inspected
in
October 2001,
the
source
had
not
taken
any
steps to participate
in
the
ERMS
program.
Packaging
was
required
to
participate
based on
its
location
in DuPage
County
and
its
emissions
of
VOM
in
excess
of
10
tons
during the
seasonal
allotment
period
each
year.
33
Packaging
did
not
submit
an
ERMS
baseline application
by
March
1,
1998,
and
did
not
submit
seasonal
emissions
reports
for
2000,
2001
and
2002
until June
12,
2003.
After
the
submission
of
its
SERs
in
2003,
Packaging
did
not
purchase
any
ATUs
to cover
its
VOM
emissions
for
any
previous
or
subsequent
years.
35
By
failing
to
timely
enroll
in
Illinois’
ERMS
program
and
maintain
ATUs
as required
by
the
program,
Respondent
violated
Section
9(a)
of the
Act
and
35
Ill.
Adm.
Code
205.3
10.
G.
Packaging
Violated
the
Flexographic
Printing
Rules
by
Failing
to
Demonstrate
Compliance
Pursuant
to
218.401(Count
VII)
On
January
6,
1994,
the
Board
adopted
amendments
to
Part
218
of
the
Board
Air
Pollution
Regulations,
as
required
by
Section
1 82(b)(2)
of
the
federal
Clean
Air
Act;
compliance
with
these
amended
regulations
was
required
by
no
later
than
March
15,
1995.36
The
Part
218
amendments
established
VOM
emission
standards
and
limitations
for
printing
facilities
located
in the
Chicago
ozone
nonattainment
area
and
having
a
potential
to
emit
25
tons
or
more
of
VOM
per
year
(“Flexographic
Printing
Rules”).
37
Section
2
18.401
specifically
applies
to
flexographic
and
rotogravure
printing
facilities.
It
32
Adm.
Code
205.150.
u
Answer
to
Amended
Complaint,
Count
VI,
par.
17.
Id.
at
Count
VI,
par.
21
and
Complainant’s
Exbibit
5,
Admitted
Fact
No.
33.
Complainant’s
Exhibit
5,
Admitted
Fact
No.
36
36.
R
93-14,
Opinion
and
Order
of
the
Board
(January
6,
1994).
3735
Ill.
Adm.
Code
218.402.
8
requires the
subject
source to utilize
inks
and
coatings that
meet
a
standard
of
40%
VOM
by
volume
of
the
inks/coatings
or
25%
VOM by
volume
of
the
volatile
content.
38
In
addition
to
meeting
the
standard,
the
source
must
also
make
a
demonstration
of
compliance
to
the
Illinois
EPA
using
the
test
methods,
recordkeeping
and
reporting
requirements
identified
within
the
regulation.
39
If a
source
cannot
meet
the
VOM
content
limits
in
its
inks
and
coatings,
Section
2
18.401
provides
that
a company
may
select
one
of
two
alternative
means
of
compliance.
The
first
alternative
allows
a company
to meet the
VOM
standards
as
a
daily
weighted
average
of
all
of
its
inks
and
coatings,
even
if
each
individual
ink
or
coating
does
not
conform
to
the
standard.
4
°
If
a
source
cannot
demonstrate
compliance
by
the
two
options,
it
must
install
a control
device
that
meets
the
required
control
efficiencies.
41
It
must
then
demonstrate
this
control
to
Illinois
EPA.
As
a
flexographic
printing
operation
within
DuPage
County,
having
a potential
to
emit
to
more
than
25
tons
of VOM per
year,
Packaging
was
required
to
comply
with
the
Part
218
regulations
by
the
March
15,
1995
deadline.
42
In
1995,
Packaging
had
four
printing
lines
in
operation
— Presses
1,
2, 4
and
543
As
noted,
Section
218.401
requires
that
all
inks
and
coatings
utilized
at a
subject
source
meet
VOM
content
requirements
and
that
the
source
demonstrate
its
compliance
with
the
standards.
38
Adni.
Code
2
18.401(a).
35111.
Adni.
Code
2
18.401(a),
(b)
and
(c)(6).
4035
Iii.
Adni.
Code
218.401(b).
‘
35
III.
Adm.
Code
2
18.401(c).
42
Answer
to
Amended
Complaint,
Count
1,
par.
4—
5.
Id.
at
Count
I,
par.
6.
9
Electronic Filing - Received, Clerk's Office, September 24, 2009
Packaging
admits
that
Presses
4
and
5
did
not
utilize
compliant
inks
and
could
not
have
complied with
Part 218.401
by
switching
to
compliant
inks.
44
Packaging
also
admits
that
Press
4 operated
from
the
date
it
was
installed
in 1992
until
it was
decommissioned
in December
2002
without
any
control
device.
45
As
such,
Press
4
was
not
in
compliance
with
Section
218.401
at anytime
it
was
operated.
Press
5
operated
with
a
recirculating
drying
oven
that allegedly
provided
some
control
of
VOM
emissions
prior
to the
connection
of Press
5
to
a regenerative
thermal
oxidizer
(“RTO”)
in
2003.
However,
the
control
efficiency
of
the recirculating drying
oven
was
never
demonstrated
to the
Illinois
EPA.
Section
218.401
of
the Board’s
regulations
requires,
not
only
that
a
company limit
its
VOM
emissions
by
complying
with
one
of
the methods
provided,
but
also
that the
company
make
a
demonstration
of that
compliance
to the
Illinois
EPA
using
the
test
methods
provided
for
in
the
regulation.
Packaging’s
only
assessment
of
the
drying
oven
was
an
“informal
emissions
46
test.”
Because
Press
5
was not
controlled
with
a demonstrated
control
device,
it was
not
in compliance
with
the
requirements
of
218.401
until
it
was
connected
to the
RTO.
Packaging
has
contended
that
all
of the
inks
used
on Presses
1
and
2
at the
Facility
are and
have
been
compliant
with the
Section
218.401(a)
limits.
47
However,
there
is
no
record
of the
ink
usage
for
the period
from
1995
to
2001.48
Section
218.401
of
the Flexographic
Printing
Rules
not
only
requires
that
a company
limit
its
VOM
‘
Complainant’s
Exhibit
5,
Admitted
Facts
No. 41
and
42;
Hearing
Transcript,
June
30,
2009,
at
p.
13,
1.
6
—
p.
15,
1. 12
(Trzupek
explaining
why
converting
to
compliant
inks
was
not a viable
option
for
Presses
4
and
5).
‘
Complainant’s
Exhibit
5, Admitted
Fact
No.
50.
Transcript,
June
29,
2009,
at
p.
46;
Complainant’s
Exhibit
8, 2003
Letter
Re
Informal
Emissions
Testing.
Answer
to
Amended
Complaint,
Count
VII,
par.
22.
See
Respondent’s
Exhibit
51
(records
provided
electtonically
to the
Complainant
dating
back
to
2001),
and Hearing
Transcript,
June
29,
2009,
at
p.
244,
1.
4
—p.
245,
1. 10.
(Tim
Piper
testifying
that
every
record
of
historical
ink
usage
was
provided
to
the
Complainant).
10
emissions
by one
of
the
methods provided,
but
also
that
the
company
make
a
demonstration
of that
compliance
to
the
Illinois
EPA
using
the
test
methods
provided
for
in
the
regulations.
49
Therefore,
Packaging
cannot
claim
compliance
for
a
period
for
which
no
records exist.
50
Additionally,
the
demonstration
of
compliance
for
the
period
from 2001
to
March
2009
was
not
provided
in a
timely
manner.
On
May
2,
2003,
Packaging
first
provided
to
the
Complainant
a
sample
of
its
records
of
the
ink
usage
on
Presses
I
and
2 on
May
2, 2003. Packaging
did
not
provide
the
Illinois
EPA
with
all of
the
documentation
available
for the
inks
utilized
on those
two
presses
until
April
24,
2009.52
By
failing
to
timely
demonstrate
compliance
to
the
Illinois
EPA,
Packaging
violated
Section
9(a)
of
the
Act
and
35
Iii.
Adm.
Code
218.401.
H.
Packaging
Violated
Flexographic
Printing
Rules
by
Failure
to
Maintain
Records
(Counts
VIII
and
XII)
Section
218.401
operates
in coordination
with
Section
2
18.404,
the
recordkeeping
provision
in
the
Flexographic
Printing
Rules.
Section
2
18.401
indicates
that
compliance
with
the
VOM
limitations
specified
therein
must
be
demonstrated
through,
among
other
actions,
the
recordkeeping
requirements
identified
in
Section
218.404.
A
facility’s
obligations
under
Section
218.404
vary
based
upon
which
alternative
for
compliance
the
source
has
chosen
to utilize.
For
all
emissions
sources
using
compliant
inks,
the
owner
or
4935
Adm.
Code
218.401(a)
(stating
“Compliance
with
this
Section
must
be
demonstrated
through
the
applicable
coating
or
ink
analysis
test
methods
and
procedures
siecified
in
Section
218.105(a)
of
this
Part
and
the
recordkeeping
and
reporting
requirements
specified
in
Section
218.404(c)
of
this
Part.”)
°
Packaging
claims
it
kept
MSDS
sheets
prior
to
2001,
but
no
records
of
what
was
used
on
Presses
1
and
2
prior
to
2001
were
ever
provided
to
the
Illinois
EPA.
‘Complainant’s
Exhibit
13,
May
2003
Letter
Re
Demonstration
of
52
Compliance.
Respondent’s
Exhibit
51,
CD-ROM
of
Environmental
Records.
35
Ill.
Adm.
Code
218.401(a)
(stating,
“Compliance
with
this
Section
must
be
demonstrated
through...
the
recordkeeping
and
reporting
requirements
specified
in
Section
218.404(c)
of
this
Part”);
35
Iii.
Adm.
Code
2
18.401(b)
(stating,
“Compliance
with
this
subsection
must
be
demonstrated
through..
.
the
recordkeeping
and
reporting
requirements
specified
in
Section
218.404(d)
of
this
Part”);
and
35
Ill.
Adm.
Code
218.40
l(c)(6)
(stating,
“The
owner
or
operator
shall
demonstrate
compliance
with
this
subsection.
.
by
complying
with
the
recordkeeping
and
reporting
requirements
specified
in
Section
218.404(e)
of
this
Part”).
11
Electronic Filing - Received, Clerk's Office, September 24, 2009
operator
must
maintain
daily
records
identifying
every
ink
and
coating
utilized
on
each
printing
line
and
the
VOM
content
of
54
each.
If
the source
is
achieving
compliance
based
on
daily-weighted
averaging,
then
the
owner
or
operator
must
maintain
a
record
of
the
daily-weighted
average
VOM
content
of
the inks
and
coatings, in addition
to
daily
records
of
all
inks
and
coatings
used
and
the
VOM
content
of
each.
55
A
source
that
chooses
to
install
an
add-on
control
device
must
maintain
daily
records
of
emissions
monitoring
data;
operating
times
of
the
printing
lines,
control
device,
capture
system
and
monitoring
equipment;
all
routine
and non-routine
maintenance;
and
any
outages
resulting
from
maintenance
or
repair.
56
The
source
must
also
record
and
submit
test
results
and
calculations
showing
that
the
unit
meets
the
VOM
efficiency
requirements
of
Section
218.401.
As
of August
13, 2003,
Packaging
was also
obligated
to
maintain
these
records
based
on
the terms
of a
construction
permit
issued
specifically
for
Packaging’s
Carol
Stream
Facility
(“Construction
Permit”).
58
Respondent
ultimately
achieved
compliance
in
two
ways
- compliant
inks,
as
provided
for
in
section
218.401(a),
and
a
control
device,
as
provided
for in
section
2
18.401(c).
59
The
recorcikeeping
associated
with
these
two
compliance
methods
has
not
been
adequately
maintained.
Packaging
admits
that
it has
not maintained
daily
records
of inks
used
and
the
VOM
content
of those
inks,
as
well
as
a
maintenance
log
for
the
capture
system,
control
device
and
monitoring
system,
at all
times
since
at least
the
date
it received
the
Construction
Permit.
6
°
Packaging
admits
that
it has
not
maintained
‘
35
Ill. Adm.
Code
218.404(c).
35
Iii.
Adm.
Code
2 18.404(d).
35
III.
Adm.
Code
2
18.404(e).
57
1d.
58
Complainant’s
Exhibit
3,
2003
Construction
Permit,
Conditions
No. 15
and
16.
Complainant’s
Exhibit
5, Admitted
Facts
No.
40 and
43.
60
1d.,
Admitted
Fact
No.
56.
12
monthly records
of
the
names
and
amounts
of
solvents
used
for
ink
dilution
and
clean-up,
the
VOM
content
of
those
solvents, and
the
VOM
and
Hazardous
Air
Pollutant
(“HAP”)
emissions
for
the
preceding
12
months,
at
all
times
since
at
least
the
date
it
received
the
Construction
Permit.
61
At
the
inspections
in
March
and
May
of
2004,
conducted
by the
Illinois
EPA
to
assess
Packaging’s
compliance
with
the
terms
of the
Construction
Permit,
Packaging
was
not
able
to
produce required
records
for
Illinois
EPA
personneL
62
By
failing
to
regularly
maintain
all
required
records,
Packaging
violated
35
Iii.
Adm.
Code
2
18.404
and
Condition
16 of
its
Construction
Permit,
and
thereby
Sections
9(a)
and
(b)
of
the
Act.
63
I.
Packaging
Violated
its
Construction
Permit
by
Exceeding
VOM
Usage
Limits
(Count
IX)
The
Act
provides
that
compliance
with
Illinois’
environmental
laws
includes
full
compliance
with
the
terms
and
conditions
of
any
permit
issued
by
the
Illinois
EPA
to
a
source.
64
On
August
13,
2003,
the
Illinois
EPA
issued
a Construction
Permit
to
Packaging.
65
The
Construction
Permit
was
directed
to
the
attention
of
Dominic
Imburgia,
President
of
Packaging,
and
contained
compliance
obligations
specific
to
Packaging’s
Carol
Stream Facility.
66
Condition
5
of
the
Construction
Permit
specified
that
the
total
VOM
emissions
resulting
from
all
printing
at
Packaging’s
Facility
should
not
exceed
the
following
limits:
67
Id.,
Admitted
Fact
No.
57.
62
Id.,
Admitted
Facts
No.
60
and
62.
415
ILCS
5/9(a)
and
(b)
(2008)
415
ILCS
5/9(a)
(2008).
65
See
Complainant’s
Exhibit
3,
2003
Construction
66
Permit.
Id.
67
1d.
at
Condition
5.
13
Emission
Unit
VOM
Usage
VOM
Usage
VOM
Emissions
VOM
Emissions
(Lb/Mo)
(Ton/Yr)
(Lb/Mo)
(Ton/Yr)
#1
and
#2
524
2.62
524
2.62
Presses
Comexi
and
#5
24,960
124.80
3,396
16.98
Presses
Cleanup
and
980
4.90
980
4.90
Other
Solvents
Based
on
these usage
limits,
Respondent’s
VOM
usage
was
not
to
exceed
26,464
lbs/month
following
the
installation
of
the
RTO. Packaging
admits
that
its
VOM
usage
from
August
2003
to
July
2004 was
as
follows:
68
Month/Year
VOM
Total
Usage
(Lb/Mo)
August/2003
31,880
September/2003
40,823
October/2003
38,587
December/2003
24,354
AprilI2004
18,193
May/2004
24,253
June/2004
32,082
July/2004
21,971
Packaging
exceeded
the
monthly
VOM
usage
limits
four
times
from
August
2003
to
July
2004.
By
repeatedly
exceeding
the
VOM
usage
limits,
Packaging
violated
Condition
5
of
its
Construction
Permit,
and
thereby
Section
9(a)
of
the
Act.
69
Complainant’s
ExhibitS,
Admitted
Fact
No.
55.
69415
ILCS
9(a)
(2008).
14
J.
Violation
of
Construction
Permit
by
Failing
to
Demonstrate
Compliance
(Count
X)
Condition
4(c)
of
the
Constmction
Permit
requires
Packaging
to
ensure
that
Presses
1 and
2 met
the
VOM
content
standards
of Section
218.401(a)
of
the
Flexographic
Printing
Rules.
7
°
As
stated
in
Section
218.401(a),
“[c]ompliance
with
this
Section [218.401
(a)j
must
be
demonstrated
through..
.
the
recordkeeping
and
reporting
requirements
specified
in
Section
218.404(c)
of this
Part.”
7
’
When
Illinois
EPA
inspected
the
Facility
on
April
22,
2004,
and
on
May
14,
2004,
to determine
Packaging’s
compliance
with
the
terms
of
the
Construction
Permit,
Packaging
was
unable
to
demonstrate
to
the
Illinois EPA
that
it
was
using
only
compliant
inks
on
Presses
1
and
2.72
By
failing
to
make
a
demonstration
to the
Illinois
EPA
that
Presses
1 and
2
were
utilizing
only
compliant
inks,
Respondent
violated
Condition 4(c)
of
its Construction
Permit,
and
thereby
Section
9(b)
of the
Act.
73
K.
Packaging
Violated
its
Construction
Permit
by
Failing
to
Conduct
Required
Testing
(Count
XI)
Complainant
voluntarily
dismisses
Count
XI
of
the
People’s
Amended
Complaint.
L.
Packaging
Violated
its
Construction
Permit
by
Failing
to
Maintain
Records
(Count
XII)
Conditions
15
and
16
of the
Construction
Permit
contain
Packaging’s
daily
and
monthly
recordkeeping
requirements
for
the
Facility.
Specifically,
Condition
15
requires,
in part,
daily
records
of
ink
usage
on
each
press,
and
the
VOM
content
of
those
inks,
and
a
maintenance
log
for
all
routine
and
non-routine
maintenance,
including
any
°
Complainant’s
Exhibit
3,
2003
Construction
Permit,
Condition
71
4(c).
Adm.
Code
2
18.401(a).
72
Complainant’s
Exhibit
5,
Admitted
Fact
Nos.
56,
57
and
59
through
62.
415
ILCS
5/9(b)
(2008).
Complainant’s
Exhibit
3,
2003
Construction
Permit,
Conditions
No.
15
and
16.
15
Electronic Filing - Received, Clerk's Office, September 24, 2009
outages
resulting from
maintenance.
Permit
Condition
16
requires
monthly
records
of
ink
usage
by
press,
and
the
VOM
content
of the
inks;
solvent usage
for
ink
dilution
and
for
clean-up, and
the
VOM
content
of the
solvent;
VOM
and
HAP
for
the
preceding
month
and
preceding
12
months.
When
Illinois
EPA
inspected
the
Facility
on
April
22,
2004,
and
again
on
May
14,
2004,
to determine Packaging’s
compliance
with
the
terms
of
the
Construction
Permit,
Packaging
was
unable
to
produce
these
required
daily
and
monthly
records
for
the Illinois
EPA
inspector.
75
By
failing
to
demonstrate compliance
with
its
recordkeeping
obligations,
Respondent
violated
Conditions
15
and
16 of
its
Construction
Permit,
thereby
Section
9(b)
of
the
Act.
76
IV.
ANALYSIS
OF
THE
33(c)
FACTORS
DEMONSTRATES
THAT
THE
BOARD
SHOULD
ASSESS
A
SIGNIFICANT
CIVIL
PENALTY
AGAINST
RESPONDENT
In making its
orders,
the Board
is
directed
to
consider
matters
of
record
concerning
the
reasonableness
of
the
alleged
pollution,
including
those
factors
identified
in
Section
33(c)
of
the Act.
77
Section
3
3(c)
of the
Act
provides
as
follows:
In
making
its
orders
and
determinations,
the
Board
shall
take
into
consideration
all
the
facts
and
circumstances
bearing
upon
the
reasonableness
of the
emissions,
discharges
or deposits
involved
including,
but
not
limited
to:
(i)
the
character
and
degree
of
injury
to,
or interference
with
the
protection
of
the
health,
general
welfare
and
physical
property
of
the
people;
(ii)
the
social
and
economic
value
of
the
pollution
source;
“
Complainant’s
Exhibit
5, Admitted
Facts
60
and
62.
415
JLCS
5/9(b)
(2008).
415
ILCS
5/33(c)
(2008).
16
(iii)
the
suitability
or
unsuitability
of
the
pollution
source
to
the
area
in
which
it
is
located,
including
the
question
of
priority
of
location
in
the
area
involved;
(iv)
the
technical
practicability
and
economic
reasonableness
of
reducing
or
eliminating
the
emissions,
discharges
or
deposits
resulting
from
such
pollution
source;
and
(v)
any
subsequent
compliance.
A.
Packaging’s
excess
VOM
emissions
interfered
with
protection
of
the
health
and
general
welfare
of
the
people
During
the
documented
period
of
noncompliance,
Packaging
failed
to
regulate
VOM
from
its
emission
sources
and
violated
the
Board’s
emission
standards
for
major
VOM sources,
i.e.
sources
that
have
the
potential
to
emit
25
tons
or
more
of
VOM
per
year.
VOM
is
an
air
contaminant
that
results
in
ground-level
ozone
formation;
its
release
into
the
environment
poses
a
threat
to
human
health.
78
The
Board’s
standards
for
Major
VOM
sources
were
adopted
because
Section
110
of
the
CAA required
states
to
develop
regulations
and
control
strategies
to
address
air
pollution
within
their
jurisdictions.
79
The
standards
are
designed
so
that
the
National
Ambient
Air
Quality
Standards
(“NAAQS”)
are
not
adversely
impacted
through
industrial
development
and
growth.
8
°
The
Board
has
specifically
adopted
regulations
to
improve
ozone air
quality
in
northeast
Illinois
through
establishing
VOM emissions
standards
and
limitations
for
major
sources
in
the
Chicago
ozone
nonattainment
area.
81
These limitations
required
Packaging
to
either
utilize
inks
in
its
printing
facilities
that
78
Breathing
ozone
can
trigger
a
variety
of
health
problems
including
chest
pain,
coughing,
throat
irritation,
and
congestion,
It
can
worsen
bronchitis,
emphysema,
and
asthma.
Ground-level
ozone
also
can
reduce
lung
function
and
inflame
the
linings
of
the
lungs.
Repeated
exposure
may
permanently
scar
lung
tissue.
Ground
Level
Ozone,
Health
and
Environment,
http://www.epa.gov/air/ozonepollution/healthhtml
(Last
u?dated
on
May
9th,
2008).
42
U.S.C.
7410
(2008).
°
35
Ill.
Adm.
Code
205.110.
8!
Adm.
Code,
Part
218.
17
meet
a
standard of
40% VOM
by
volume
of
the
inks/coatings
or
25%
VOM
by
volume
of
the
volatile content;
to
meet
the
VOM
standards
as
a
daily weighted
average
of all
of
its
inks and
coatings;
or
to
install
a
control
device
that
meets
the
standards.
82
As
discussed
previously,
Packaging
failed
to
comply
with
these
requirements,
which
increased
the
Facility’s
net
emissions
of
VOM.
By
operating
a
printing
facility
that
was
located
in
an
ozone
nonattainment
area
that
was
classified
as
“severe”
and
failing
to
regulate
VOM
from
its
emissions
sources,
Packaging’s
emissions
adversely
affected
the
ozone
nonattainment
area
and
air
quality
in
DuPage
County. The
greater
the
increase
in
excess
emissions
to
the
atmosphere
in
this
area,
the
greater
potential
threat
is
posed to
the
NAAQS.
Packaging’s
increased
VOM
emissions
must
be
considered
in
conjunction
with
the
cumulative
effects
of
increased
emissions
elsewhere
in
the
nonattainment
area.
The
cumulative
impacts
on
air
quality
could
be
severe
if
each
source
in
the
nonattainment
area
violated
these
Board
emission
standards
for
VOM.
Packaging’s
noncompliance
for
at
least
eight
years
impeded
the
Illinois
EPA’s
efforts
to
reduce
the
sources
of
VOM
levels,
and
thereby
seriously
interfered
with
the
“protection
of
the
health, general
welfare
and
physical
property
of
the
people.”
83
B.
Packaging’s
facility
had
a
diminished
social
andlor
economic
value
while
it
operated
in
violation
of
the
Act
The
Complainant
does
not
dispute
that
any
business
entity
which
employs
people
and
supplies
products
to
the
open
market
has
a
degree
of
social
and
economic
value.
While
Packaging’s
printing
and
extruding
facility
serves
these
roles,
a
facility
that
operates
in
violation
of
the
Act
and
Board
regulations
is
a
social
and
economic
detriment.
8235
Iii.
Adm.
Code
2
18.401.
‘
415
1LCS
5/33(c)(i)
(2008).
18
Electronic Filing - Received, Clerk's Office, September 24, 2009
The
Board
has
previously found
that
a
pollution
source
typically possesses
a
social
and
economic
value
that
is
to
be
weighed
against
its
actual
or
potential
environmental
impact.
84
Packaging’s
failure
to
reduce
its
VOM
emissions in
an
area
of
severe
nonattainment
for
ozone
for
an
extended
period
of time
was
a detriment
to
the
site
and
surrounding
area,
which
therefore
diminished
the social
and
economic
value
of
the
source.
C.
Respondent’s
facility
is
suitable
for
the
area
in
which
it
is
located
provided
it
operates
in
compliance
with
the
Act
Operation
of Packaging’s
Facility
is
suitable
for
the
site
and
surrounding
area
provided
it
is
operated
in
compliance
with
the Act
and
Board
Air
Pollution
Regulations.
However,
as
shown
herein,
Packaging
failed
to
comply
with
almost
all of
the
applicable
requirements
of the
Act
and
the
Board’s
Air
Pollution
Regulations.
Packaging
established
a major
source
of
air
emissions
without
demonstrating
or
achieving
LAER
at
the
Facility.
It did
not
install
a
control
device
meeting
the
required
efficiency
standards
until
2003.85
By failing
to
comply
with
requirements
that
reduce
VOM
emissions,
Respondent’s
Facility
contributed
excess
VOM
to an
area
that
was
not
in
compliance
with
the NAAQS for
ozone.
Thus,
during
the
time
Respondent
was
out
of
compliance,
its Facility
was
not
suitable
to
the
area
in which
it
was
operating.
D.
Compliance
wa
technically
practicable
and
economically
reasonable
The
evidence
shows
that
it
was
technically
practical
and
economically
reasonable
for
Packaging
to comply
with
the
Act
and Board
Air
Pollution
Regulations.
Applying
for
and
obtaining
constmction
and
operating
permits,
including
a
CAAPP
permit,
from
the
415
ILCS
5/33(c);
See generally,
People
v.
Waste
Hauling
Landfill,
Inc.,
and
Waste
Hauling,
Inc.,
PCB
No.
95-91
(May
21,
1998,
slip
op.
at
27).
‘
Complainant’s
Exhibit
5, Admitted
Fact
Nos.
37,
44
and 46
(verifring
RTO
was
installed
in 2003,
began
operating on
November
11, 2003,
and
was
stack
tested
to
verify
efficiency
on
February
26,
2004).
19
Illinois EPA
is
a
simple,
low-cost measure
that
is
not
unduly burdensome
for
subject
sources.
Similarly,
enrolling
in
Illinois’
ERMS program,
monitoring
seasonal
emissions
each
year
and
purchasing
ATUs
does
not
impose
an
unreasonable
cost
or
time investment
on
a
company
like
Packaging.
Packaging
itself
asserts
that
the
company’s
failure
to
comply
with
applicable
environmental
regulations
was the
result
of
its
ignorance
of
the
law;
it
does
not
assert
that
it was
not
able
to comply
with
the
regulations.
86
As
evidence
of
the
feasibility
of
compliance,
Packaging
did
take
actions
required
for
compliance
following
the
Illinois
EPA
site
inspection
in
October
2001.87
Additionally,
after
Illinois
EPA’s
outreach
to
the
entire
regulated
community,
only
three
companies
ultimately
sought adjusted
standards
to
obtain
an
extension
on
the
compliance
deadline,
and
even
those companies
have
since installed
control
devices
meeting the
VOM
standards.
88
Thus,
the
evidence
shows
that
it
was
both
technically
feasible
and
economically
reasonable
to
require
Packaging
to participate
in
reporting
and
permitting
programs
and
to
limit
its
VOM
emissions
in
one
of
the
means
provided
for
in
Section
218.401
of
the
Flexographic
Printing
Rules.
E.
After
years
of
continuing
violation,
Packaging
came
into
compliance
The
Complainant
acknowledges
that
Packaging
took
steps
to
achieve
compliance
with
its
regulatory
obligations
after
the
Illinois
EPA
inspected
the
facility
in
2001.
However,
Packaging
achieved
compliance
only
after
continuously
violating
the
Act
for
at
least
ten
years,
from
1992
to
2002.89
86
See
Answer
to
Amended
Complaint,
Count
I,
par.
18,
Count
II,
par.
18,
Count
III,
par.
21,
Count
IV,
par.
23,
Count
V,
par.
31
and
Count
VI,
par.
21.
Id.
88
Hearing
Transcript,
June
29,
2009,
atp.
50,1.
2—6
and
10—
17.
89
See
Sections
III.A
to
1II.L
herein,
outlining
the
nature
and
duration
of
each
violation,
e.g.,
Respondent’s
operation
without
a
permit
for
more
than
10
years,
as
admitted
by
Respondent
and
noted
in
footnote
8.
20
V.
AYE
ER
CONSIDERATION
OF
THE
42(h)
FACTORS,
THE
BOARD
SHOULD
ASSESS
A
CIVIL
PENALTY
OF
AT
LEAST
$861,274.00
A.
Statutory
Civil
Penalties
The
evidence at
hearing
demonstrates
that
the
Respondent
has
violated
the
Act
and
Board
Air
Pollution
Regulations.
Section
42(a)
of
the
Act
permits the
Board
to
impose penalties
against
those
who
violate
any
provision
of
the
Act
or
regulation
adopted
by
the
Board.
9
°
The
Board
may
impose
a maximum
penalty
of
$50,000.00
for
each
violation
of
the
Act,
and
an
additional
$10,000.00
penalty
for
each
day
the
violation
continues.
9
’
Additionally,
Section
42(h)
of
the
Act
requires
that
the
Board
ensure
“that
the penalty
is
at
least
as
great
as
the
economic
benefits, if
any,
accrued
by
the
respondent.”
92
In
its
case,
the
State
has
proven
eleven
violations
of
the
Act
over
a period
of
more
than
a
decade.
93
The
evidence
presented
at
hearing
showed
that
the
Respondent
received
an
economic
benefit
of
$711,274.00
resulting
from
the
delayed
installation
of
a
pollution
control
device
and
avoided
annual
costs.
94
Based
on
the
extensive
period
of
noncompliance,
the
number
of
violations
and
the
economic
benefit
received
by
Packaging,
Complainant
requests
that
the
Board
impose
a
civil
penalty
of no
less
than
$861,274.00
on
Respondent
for
the
violations.
90415
ILCS
5/42(a)
(2008).
‘
Id.
92415
ILCS
5/42(h)
(2008).
See
Sections
lILA
to
III.L
herein,
outlining
the
nature
and
duration
of
each
violation.
Hearing
Transcript,
June
29,
2009,
at
p.
125,
1.
14
-18.
21
B.
Section
42(h)
Aggravating
and
Mitigating
Factors
Section
42(h)
of the
Act,
authorizes
the Board
to consider
the impact
of any
matter
of
record
in
determining
an
appropriate
civil
penalty.
95
Specifically,
Section
42(h)
provides
as
follows:
In
determining
the
appropriate
civil
penalty
to be
imposed
under
subdivision
(a) ..
of
this
Section,
the
Board
is authorized
to
consider
any
matters
of record
in
mitigation
or
aggravation
of penalty,
including
but not
limited
to the
following
factors:
(1)
the
duration
and gravity
of
the violation;
(2)
the
presence
or
absence
of due
diligence
on
the
part
of
the
respondent
in attempting
to comply
with
requirements
of
this
Act
and
regulations
thereunder
or
to secure
relief
therefrom
as
provided
by
this
Act;
(3)
any
economic
benefits
accrued
by
the
respondent
because
of
delay
in compliance
with
requirements,
(4)
the
amount
of monetary
penalty
which
will
serve
to
deter
further
violations
by
the
respondent
and
to otherwise
aid in
enhancing
voluntary
compliance
with
this
Act
by the
respondent
and other
persons
similarly
subject
to the
Act;
(5)
the
number,
proximity
in
time,
and
gravity
of
previously
adjudicated
violations
of this
Act
by
the respondent;
(6)
whether
the
respondent
voluntarily
self-disclosed,
in
accordance
with
subsection
(i)
of this
Section,
the
non-compliance
to
the
Agency;
and
(7)
whether
the
respondent
has agreed
to undertake
a “supplemental
environmental
project,”...
1.
Duration
and
Gravity
The
evidence
before
the
Board
in
this
matter
demonstrates
that
the duration
and
gravity
of
Packaging’s
violations
were
significant
and
warrant
a
substantial
civil
penalty.
415
ILCS
5/42(h)
(2008).
22
Electronic Filing - Received, Clerk's Office, September 24, 2009
Complainant requests
that
the
portion
of
the
civil
penalty
that
is
attributable
to
factors
other
than
economic
benefit
be
no
less
than
$150,000.00.
As
outlined
above,
the
Respondent
violated
permitting
requirements,
reporting
requirements,
and
many
of
the
programs
designed
to
reduce
VOM
emissions
from
the
Facility —
the
ERMS
program,
New
Source
Review,
the
Flexographic
Printing
Rules
and
its
Construction
Permit.
The
violation
of
these
legal
obligations
resulted
in actual
excess
emissions
of
VOM
to
the
atmosphere.
The
Act
“authorizes
the
Board
to
assess
civil
penalties for
violations
regardless
of
whether
these
violations
resulted
in actual
pollution.”
96
Here,
however,
the
violations
did
result
in
actual
pollution.
Press
4,
which
has
a
PTE
of
52
tpy,
was
operated
without
any
controls
from
1992
to
2002.
This
press
should
have
been
controlled
by
the
Respondent
as
of the
effective
date
of
Part
218,
March
15,
1995
.
A
control
device
achieving
the
required
capture
and
control
efficiency
would
have
dramatically
reduced the
VOM
emissions
from
Press
4.
The
gravity
of the
excess
VOM
emissions
from
Packaging’s
Carol
Stream
Facility
is
aggravated
by
its
location
in
an
area
designated
as
severe
nonattainment
for
ozone
during
the
relevant
period.
As
Mr.
Bloomberg
testified,
from
1993
to
2003,
the
Chicago area,
including
DuPage
County,
was
a
severe
ozone
nonattainment
area.
99
VOM
is
the
greatest
threat
during
the
ozone
formation
season
from
May
to
September
each
year.
Packaging
reports
that
its
seasonal
emissions
in
2000,
2001,
and
2002
ranged
from
13.75
to
20.14
tons
during
those
months.
10
°
Ground-level
ozone is
a
threat
to
human
96
ESG
Watts,
282
111.
App.
3d
at
51.
Respondent’s
Answer
to
Amended
Complaint,
Count
V,
par.
19;
and
Complainant’s
Exhibit
5,
Admitted
Facts
No.
11
and
50,
R
93-14,
Opinion
and
Order
of
the
Board
(January
6,
1994).
99
Hearing
Transcript,
June
29,
2009,
at
p.
42,
1.
‘°°
9-12,
Respondent’s
Exhibit
50,
May
2009
Revised
SERS.
23
Electronic Filing - Received, Clerk's Office, September 24, 2009
health
and
can
cause,
among
other
problems, reduced
lung
functioning
and
inflammation
of
the
lining
of
the
lungs.’°’
In addition
to
causing
excess
VOM
emissions,
Packaging
failed
to
comply
with
its
permitting
and
reporting
requirements,
which
are
of
programmatic
significance
to
the
Agency
and,
therefore,
to
the
People
of
the
State
of
Illinois.
As
testified
to
by
Mr.
Bloomberg,
permits
are
significant
because
they
“ensure that
the
State
knows
what
equipment
is
at
sources,
how
it’s
being
controlled,
what’s
being
emitted
and
whether
or
not
those
emissions
units
are
complying
with
environmental
regulations.”°
2
Annual
emissions
reports
allow
the
Agency
to
know
the
amount
and
location
of
air
pollutants
entering
the
atmosphere)°
3
All
of
these
inform
the
Agency
in
its
essential
functions,
including
the
development
of new
regulations
and
compliance
with
federal
requirements,
such
as
the
NAAQS.’°
4
Given
Packaging’s
industry,
there
is
no
excuse
for
its
failure
to
have
been
aware
of
and
complying
with
the
requirements.
The
flexographic
printing
industry
is
highly
competitive.’
05
To
run
its
business,
Packaging
watches
trends
in the
industry
and
the
behavior
of
its
competitors,
and
competitors
are
watching
Packaging,
as
shown
by
other
companies’
awareness
of
Respondent’s
noncompliance
during
the
time
they
were
petitioning
for
adjusted
standards.’
06
Dominic
Imburgia’s
testimony
that
he
was
not
aware
of
the
existence
of
the
Clean
Air
Act
is
not
credible.’°
7
The
Company
was
101
See
supra,
ftnt
76,
Ground
Level
Ozone,
Health
and
Environment,
http://www.epa.gov/air/ozonepollution/health.htrnl.
102
Hearing
Transcript,
June
29,
2009,
at
p.
52,
1.
6-10.
‘°
3
1d.
atp.
52,1.
18—p.
53,1.3.
104
Id.
at
p.
52,
1.
2
—p.
54,
1.
5.
‘°
5
Id.
atp.
187,1.21-23.
‘°
6
1d.
at
p.
51,
1.
6—
19
(Bloomberg
testifying
that
Illinois
EPA
learned
of
Packaging’s
noncompliance
from
a
competitor
who
found
the
noncompliance
“unfair”).
107
1d.
atp.
186
,
1
.
22
—p.
187,1.
1.
24
complying
with
its
hazardous
material regulations
during
the
1 990s.’°
8
The
Agency
was
conducting
outreach
to
the
flexographic
industry.’
09
Packaging
even
has
an
industry
publication,
Paper,
Film
&
Foil
Converter,
available
in
its lobby.”
0
Although
Packaging
claims
that
it was
not
aware
of
any
of its
regulatory
obligations,
it
had
ample
opportunity
and
resources
to
become
fully
educated and
informed
regarding
its
environmental
obligations.
The
Board
should
also
consider
the
length
of
time
these
violations
persisted.
Since
at least
1992,
Respondent
has
been
operating
sources
that
required
a
permit
from
the Agency.’
1
’
Packaging
did
not
submit
its first
permit
application
to the
TEPA
until
July
2002.112
Packaging
was
in
violation
of
the
Part
218
regulations
from
the
effective
date
of
the
regulation
in
1995
until
the
installation
of
the
RTO
in 2003.
The
extended
period
of violation
should
weigh
heavily
against
Packaging.”
3
Based
on
the
evidence
before
the
Board,
as
highlighted
here,
gravity
and
duration
should
weigh
as
an
aggravating
factor
against
Packaging
in the
Board’s
assessment
of
an
appropriate
civil
penalty.
2.
The
Evidence
Shows
a Lack
of
Due
Diligence
by
Packaging
The
evidence
shows
that
Packaging
demonstrated
an
absence
of
due
diligence
in
complying
with
the
Act,
the
Board’s
Air
Pollution
Regulations
and
its
Construction
Permit.
As
noted
above,
Packaging
alleges
that
it
was
unaware
of
its
environmental
108
Id.
at
p.
258,
1. 11
—
p.
259,
1. 6.
109
Id.
at
p.
47,
1.
9—p.
49,
1.
15 (Bloomberg
testifying
that
Illinois
EPA
sent letters
to
all sources,
including
Packaging,
and
formed
a working
group).
110
Complainant’s
Exhibit
5,
Admitted
Fact
Nos.
63
—64.
112
Answer
to Amended
Complaint,
Count
I, par.
6
and
Count
II,
par:
18.
Complainant’s
Exhibit
5, Admitted
Fact
Nos.
17—
18.
See,
People
of
the
State
of
Illinois
v.
Panhandle
Eastern
Pipe
Line
Company,
PCB
99-191
(November
15,
2001,
slip
op.
at 29)
(long
period
of
violations
was
an
aggravating
factor
for
purpose
of
penalty);
United
States
v.
Marine
Shale
Processors,
81
F3d
1329
(
5
th
Cir.
1996)
($2,500,000
penalty
for
twenty-nine
unpermitted
minor
sources
occurred
over
approximately
eleven-year
period).
25
obligations until
the
Illinois
EPA
conducted
a
site
inspection
in
October
2001.
Packaging
failed
to
show
due
diligence
prior
to
2001
by
failing
to
proactively
seek
out
information
about
its
environmental
obligations
when
an
abundance
of
resources were
available
that
served
to
provide
notice
of,
and
assistance
in,
ascertaining
its
legal
obligations.
Following
the
2001
site
inspection, Packaging
began
to
take
concrete
steps
to
achieve
compliance
with
the
Act
and
Board Air
Pollution
Regulations.
However,
Packaging
by
no
means
took
all
available
steps
to
achieve
immediate
compliance.
Respondent
waited
fourteen
months
before
decommissioning
Press
4
and
determined
not
to
expend
the
time
and
cost
to
make
a demonstration
of
compliance
for
Press
5
until
February
2004.114
Moreover,
Rich
Trzupek,
Respondent’s
environmental
consultant,
acknowledges
in
his
testimony
that
he
understood
that
a formal
test
would
be
required
and
that
he
explained
this
to
Packaging
when
he
was
first
retained.”
5
Packaging
was
also
not
diligent
in
ensuring
compliance
with
its
Construction
Permit
after
its
issuance.
At
the
time
the
Construction
Permit
was
issued
in
June
2003,
Respondent
had
been
aware
of
its status
as a
regulated
entity
since
at least
October
2001.”
6
The
company
was
already
aware
that
its
obligations
included
control
of
its
VOM
emissions
and
the
maintenance
of
records,
as
these
requirements
were
identified
in
the
Violation
Notice
sent
to
the
Respondent
on
January
25,
2002.’
‘
When
Illinois
EPA
conducted
a
site
inspection
in
2004,
however,
Respondent
was
unable
to
produce
required
records
for
the
Agency
to
review
even
though
the
Construction
Permit
clearly
“4
See
Respondent’s
Exhibit
4,
Expert
Report
of
Chris
McClure,
p.
4
(Press
4
decommissioned
in
December
2002);
and
Complainant’s
Exhibit
5,
Admitted
Facts
No.
37
and
38
(establishing
stack
test
occurred
on
February
26,
2004
and
2004
stack
test
was
first
approved
compliance
test).
“
Hearing
Transcript,
June
29,
2009,
atp.
26.,
1.
116
13-18.
See
Complainant’s
Exhibit
3,
2003
Construction
Permit;
and
Respondent’s
Exhibit
9,
Illinois
EPA
Inspection
Report
(showing
date
of
first
inspection
was
October
5,
2001).
“
Respondent’s
Exhibit
10,
Notice
of
Violation
dated
January
25,
2002.
26
Electronic Filing - Received, Clerk's Office, September 24, 2009
states the
records
must
be
available.’
18
Additionally,
the
VOM usage
at the
Facility
was
repeatedly
above
the
permit limit
in
the
period
from August
2003
to
July
2004.’
‘
These
failures
show an
absence
of
due
diligence
on
the
part
of
Packaging
and
should
be
weighed
against
Respondent
as
an
aggravating
factor
in
assessing
a
penalty.
3.
Economic
Benefit
a.
An
Appropriate
Civil
Penalty
Must
Include
Recovery
of
All
Economic
Benefit
from
Packaging’s
Violation
of
35
Ill.
Adm.
Code
218.401
The
Act
requires
that,
absent
the
narrowest
of
circumstances,
a
civil
penalty
must
recover
all
economic
benefit
accruing
to a
respondent
as
a
result
of
the
violation.
Specifically,
Section
42(h)
of
the
Act,
415
ILCS
5/42(h)
(2008)
provides,
in
pertinent
part:
In
determining
the
appropriate
civil
penalty
to
be
imposed...
the
Board
shall
ensure,
in
all
cases, that
the
penalty
is
at
least
as
great
as
the
economic
benefits,
if
any,
accrued
by
the
respondent
as
a result
of
the
violation,
unless
the
Board
finds
that
imposition
of
such
penalty
would
result
in
an
arbitrary
or
unreasonable
financial
hardship.
Although
Packaging
started
as
a
small
family
business,
it
is
now
a
nationally
competitive
company
with
facilities
in
multiple
states.
120
In
the
Carol
Stream
Facility
alone,
there
are
approximately
100
employees.’
2
’
As
such,
it
is
neither
arbitrary
nor
H
Complainant’s
Exhibit
3,
2003
Construction
Permit,
par.
17
(“All
records
and
logs
required
by
this
permit
shall
be
retained
at
a
readily
accessible
location
at
the
source
for
at
least
three
years
from
the
date
of
entry
and
shall
be
made
available
for
inspection
and
copying
by
the
Illinois
EPA
or
USEPA
upon
request.
Any
records
retained
in
an
electronic
format
(e.g.,
computer)
shall
be
capable
of
being
retrieved
and
printed
on
paper
during
normal
source
office
hours
so
as
to
be
able
to
respond
to
an
Illinois
EPA
or
USEPA
request
for
records
during
the
course
of
a
source
inspection.”)
Section
111.1
herein,
establishing
VOM
usage
exceedances;
and
Complainant’s
Exhibit
3,
Admitted
Fact
No.
55.
120
Hearing
Transcript,
June
29,
2009,
at
p.
187,
1.
21
—
p.
188,
1.
2
(Packaging
competes
nationally)
and
p.
220,
1.
20-23
(Packaging
acquired
a
facility
in
Sparta,
MI
in
late
121
2002).
Id.
atp.
188,1.
12—15.
27
unreasonable
to
recover
all
of
the
economic
benefit
accruing
to
Packaging
for
delaying
and
avoiding
capital
expenditures
needed
to control
VOM
for
a period
of
seven
years.
b.
The
Economic
Benefit
Derived
from
the
Violations
was
at
Least
$711,274.00
Mr.
Gary
Styzens
testified
on
behalf
of
the
State
on the
issue
of Packaging’s
accrued
economic benefit
from
the violations
alleged
in the
People’s
Amended
Complaint.
Mr.
Styzens
is
employed
by Illinois
EPA
(“Agency”)
as an
Economic
Benefit
Analyst
and
Manager.’
22
Mr.
Styzens’
educational
background
includes
extensive
undergraduate
course
work
in
business
and
accounting
and
a Master’s
Degree
in
Business Administration.’
23
He has
examined
numerous
professional
articles,
court
and
Board
opinions,
and
state
and
federal
guidance
addressing
the
topic
of
economic
benefit.’
24
He
is
also
a
Certified
Internal
Auditor.
125
Mr.
Styzens
has
extensive
experience
in
estimating
the economic
benefit
of
noncompliance
in environmental
contexts.
His
prior
expert
testimony
on
behalf
of the
Agency
includes
four
Board
matters
and
one case
tried
in
Circuit
Court.’
26
Aside
from
his
normal
salary,
he
did
not
receive
any
additional
compensation
for
his
testimony
at hearing.’
27
Mr.
Styzens’
testimony
outlined
the
methodology
that
he
employed
to arrive
at
his
estimate
of
economic
benefit.
His
analysis
identifies
expenditures
for
pollution
control that
were
delayed
or
avoided
by
a company.’
28
Delayed
costs
result
in
financial
advantage
based
on the
concept
of
the time
value
of money,
which
recognizes
that
money
‘
22
Id.
atp.
98,1.
14-
17.
‘DId.
at
p.
99, 1.
6-24.
‘
24
1d.
atp.
106,1.1-6.
‘
Id.
at
p.
100,
1.7-10.
126
1d.
atp.
102,1.
16-22;
p
103,1.
1-9.
127
Id.
at
p.
99,1.
1-5.
“
8
!d.
atp.
104,1.15-17.
28
that
is
not
spent
on
pollution
control
can
be
invested
in
other
ways.’
29
The
focus
of
this
analysis
dealt
with
Packaging’s
failure
to
timely
install
an
RTO,
which
was
eventually
the
means
by
which
the
company
achieved
compliance
with
the
Board’s
Flexographic
Printing
Rules.
Prior
to
hearing, Mr.
Styzens prepared
an
expert
report that
describes
and
memorializes
his
calculations
and
opinions
(“Styzen’s
Expert
Report”).’
3
°
Based
on
information
provided
by
Packaging,
he
determined
that
the
company
had
delayed
the
cost
of
investing
in
an
RTO
requiring
a
one-time
capital
investment
of
$250,0OO.’’
Because
Packaging
did
not
provide
the
Agency
with
information
on
its
annual
avoided
costs,
Mr.
Styzens utilized
estimates
generated
by
the
Respondent’s
expert
for
a
different
company.
The
numbers
were
generated
by
Mr.
Trzupek
as
an
estimate
of
the
annual
costs
to
operate
and
maintain
an
RTO
of
approximately
the
same
size
installed
by
Packaging.’
32
With
this
information,
Mr.
Styzens
calculated
an
economic
benefit
of
$71
1,274.00.’
This
number
is based
upon
the
two
components
of
possible
financial
gain
identified
above:
$88,404.00
is
attributable
to
delayed
costs,
or
the
time
value
of
the
$250,000.00
expenditure
and
$622,870.00
is
attributable
to
annual
avoided
costs,
and
includes
principal
and
interest
through
December
2008.134
i.
Calculation
of
Delayed
Costs
To
calculate
the
portion
of
the
economic
benefit
associated
with
delayed
compliance,
Mr.
Styzens
began
with
the
actual
expenditure
made
by
Packaging
in
2003,
‘
29
1d.
atp.
105,1.
14-19.
Complainant’s
Exhibit
10,
Styzens’
Expert
Report.
Mr.
Styzens
developed
his
opinion
in
accordance
with
the
same
method
which
formed
the
basis
of
his
testimony
in
People
v.
Panhandle
Eastern
Pipeline
Company,
PCB
99-191.
Hearing
Transcript,
June
29,
2009,
at
p.
110,
1.
12-20.
‘
32
1d.,
atp.
119,1.6-15.
3
Id.,
atp.
125,1.
14-18.
‘
34
1d.,atp.
107,1.
11-14.
29
Electronic Filing - Received, Clerk's Office, September 24, 2009
$250,000.00.’
That
number
was
then
adjusted
to
the
value
of
those
dollars
in 1997,
taking
into
account
inflation.’
36
To
adjust
the
number
for
inflation
occurring
between
1997
and
2003,
Mr.
Styzens
utilized
the
Plant
Cost
Index,
an
inflation
index
specific
to
the
industrial
context.’
37
Mr.
Styzens
then
employed
the
marginal
income
tax
rate
to
reduce
the
value
of
the
capital
expenditure,
acknowledging
that
companies
receive
tax
benefits
from
exemptions
for
environmental
expenditures
and
tax
credits
for
the
depreciation
of
equipmeflt.’
38
After
adjusting
the
$250,000.00
for
inflation, Mr.
Styzens
then
calculated
interest
on
that
amount
from
1997
to
2003
to
detennine
the
time
value
of
the
delay.’
39
The
interest rate
used
for
this
calculation
was
the
bank
prime
loan
rate
published
monthly
by
the
Federal
Reserve.’
40
Mr.
Styzens
testified
at
hearing that
he
prefers
to
use,
and
typically
does
use,
a
company-specific
interest
rate
based
on
the
weighted
average
cost
of
capital
(“WACC”).’
4
’
However,
to
use
the
WACC,
you
must
have
company-specific
financial information
for
the
relevant
years.’
42
In
this
case,
the
WACC was
not
employed
because
Mr.
Styzens
did
not
have
a
sufficient
number
of
financial
statements
from
Packaging for
the
time
period
at
issue,
1997
to
200i’
The
bank
prime
loan
represented
the
best
alternative
to a
WACC
because
it
is
a
reasonable
estimate
of
financial
gain
on
monetary
investments
for
the
specific
time
period.’
44
It
is
published
by
a
third
party,
and
Id.,
atp.
112,1.9.
‘
36
1d.,atp.
112,
1.
9-18.
37
Id.,
atp.
113,1.2-8.
1381d.,
atp.
114,1.4-12.
‘
39
1d.,
atp.
117,1.3-10.
‘
40
1d.,
atp.
113,1.9-19.
Id.,
atp.
115,
1.
19-24.
‘
42
1d.
‘
43
Jd,atp.
116,1.16-18.
Jd.,atp.
116,
1.
2-10.
30
Electronic Filing - Received, Clerk's Office, September 24, 2009
so
it
provides
a
neutral
benchmark.’
45
Moreover,
it
is a
conservative
estimate
as
reflected
by
the
fact
that
this
rate
is
only
extended
bybanks
to
the
most
financially
secure
companies.’
46
After
calculating
interest
for
the
seven
year
period
of
noncompliance
on
the
inflation-adjusted
delayed
capital
expenditures,
Mr.
Styzens
made
the
final
adjustment
for
tax
implications
due to
depreciation.
He
then
calculated
the
net
after-tax
economic
benefit
based
on
the
time
value
of
money
for the
7
year
noncompliance
period
ending
in
2003;’
the
calculated
economic
benefit
was
$71,705.00.148
Because
this
economic
benefit
was
not
recovered
in
2003,
additional
interest
continues
to accrue.
149
Compound
interest
taken
on
the
$71,705.00 from
2003
to
December
2008
results
in
an economic
benefit
attributable
to
delayed
expenditures
of
$88,404.O0.150
ii.
Calculation
of Avoided
Costs
Avoided
costs
in
this
case
would
have
resulted
from
Packaging’s
ability
to
have
avoided
the
costs
associated
with
operating,
maintaining,
and staffing
the
RTO
during
the
entire
period
of noncompliance.’
5
’
The
largest
of these
various
components
is
the
annual
cost
to operate
an
RTO,
which
requires
electrical
and
gas
inputs.’
52
Mr.
Styzens
testified
that
requests
were
made
to
Packaging
to
provide
the
actual
costs
for
operating,
maintaining
and
staffing
the
RTO
after
the
time
it was
installed.
153
Because
this
information
was
not
available
or
not
provided,
Mr.
Styzens
utilized
estimates
for annual
‘
45
1d.
‘
46
1d.,atp.
116,1.1-10.
‘
47
1d.,
atp.
117,1.3-10.
‘
48
1d.,
atp.
115,1.
15-16.
‘
49 Id.,
at
p.
117,
1.
3-10.
150
Id.,
at
p.
117,1.
19—p.
118,1.1.
‘
51
Id., at
p.
119,1.
1-5.
‘
52
1d.,atp.
119,1.18-20.
‘
53
1d.,
atp.
119,1.8-15.
31
Electronic Filing - Received, Clerk's Office, September 24, 2009
operating
and
maintenance
on
an
RTO
of
a similar
size
and
nature.’
54
Although
Packaging
now
asserts
that
the
annual
cost
estimates
used
by
Mr.
Styzens
are
high,
his
estimate
was
based
on
information
generated
by
Packaging’s
own
expert
in
a
prior
proceeding
before the
Board.
155
The
estimate
was
developed
by
Mr.
Trzupek
over
several years.
It
was
relied
upon
by
the
Illinois
EPA
as
actual approximated
operating
costs
when
it determined
to
support
the
previous
petitioners
in
the
proceedings
before
the
Board.’
56
It
was
provided
in sworn
testimony
for
the
Board
to
rely
upon
in
making
a
determination
for
a
similarly
situated
company)
57
As
such,
the
estimate
utilized
in
Styzens
Expert
Report
can
be
considered
a
reasonable
estimate
of
annual
control
costs
where
actual
costs
are
not
available.
The
cost
estimate
provided
by
Mr.
Trzupek
in
the
Formel
proceeding,
for
estimated
annual cost
to control,
was
between
$10,000.00
and
$20,000.00 per
ton
per
year)
58
If
the
low
end
of
the
estimate
were
applied
as
an
estimate
in
this
case,
that
would
yield
an
annual
cost
of
control
of approximately
$200,000.00
per
year.’
59
Mr.
Styzens
used
a
much
more
conservative
estimate
of
the
annual
recurring
costs,
$86,000.00.160
Because
the
avoided
costs
will
never actually
be
expended
by
Packaging,
the
full
amount
of
the
avoided
cost
must
be
recouped
with
interest
in order
for
the
company
to
be
stripped
of
its
economic
benefit.
A similar
process
to
that
described
for
delayed
‘
4
!d.
Id.,
atp.
33,1.
18-24.
156
Hearing
Transcript,
June
30.
3009,
at
p.
157.
1.
13
—
p.
158,
1.
22
(Illinois
EPA’s
reliance
was
confirmed
by
Mr.
Bloomberg,
who
was
an
active
participant
in
the
drafting
of
the
regulations.
Bloomberg
also
testified
that
if
the
estimates
proffered
at
the
adjusted
standard
petitions
by
Mr.
Trzupek
had
been
on
the
magnitude
of
those
put
to
the
Board
at
the
Packaging
hearing,
the
Agency
would
not
have
supported
granting
an
adjusted
standard
to
the
previous
petitioners.).
Complainant’s
Exhibit
14,
Trzupek
Testimony
at
Formel
Adjusted
Standard
Hearing.
Hearing
Transcript,
June
29,
2009,
at
p.
33,
1.
15-17.
‘
59
Id.,
at
p.35,1.
13-21.
°Id.,atp.
123,1.
1.2—p.
124,1.3.
32
expenditures
is used
to
determine
the
financial
benefit received
by
a company
for
the
time
value
of
the
avoided
costs,
or
the
benefit of
being free
to
direct
the
money saved
in
annual recurring
costs
to
alternative
investments.
161
After
computing
the
total
costs
avoided
for
the
seven
years,
adjusting for
tax
and
inflation
and
calculating
interest, Mr.
Styzens determined
that
the
economic
benefit
of
the
annual avoided
costs,
taken
through
2003, was
$505,212.00.162
Because
this
amount
was
not
recouped
by
the
Agency
in
2003, interest
continues
to
accrue.
163
When
calculated
through
December
2008,
the
value
of
the
interest
is
$117,658.00, resulting
in total
economic
benefit
from
annual
avoided
costs
of
$622,870.00.164
The
total
economic
benefit
is the
sum
of
the
delayed
and
avoided
costs,
$711,274.00.
c.
Packaging’s
alternative
economic
benefit
analyses
should
be
rejected
At
the
hearing
in
this
matter,
Packaging
presented
economic
benefit
estimates
for
three
alternative
scenarios
of
achieving
compliance
with
Section
218.401
of
the
Act:
(1)
moving
Press
4
to
Michigan,
(2)
obtaining
an
adjusted
standard
and
(3)
purchasing
a
smaller
used
RTO.
165
These
compliance
scenarios
should
be
rejected
by
the
Board.
They
are
speculative,
beyond
the
boundaries
of
the
compliance
alternatives
presented
in
the
Board’s
Regulations
and
do
not
represent
the
company’s
actual
determination
of
the
most
cost
effective
means
of
achieving
compliance
within
the
particulars
of
its
business.
‘‘
Id.,
atp.
120,
1.
3-14.
162
Id.,
atp.
120,
1.
3-14
and
p.
121,
1.
1-20.
163
Id.,
atp.
122,1.
11-16.
‘MId.,
atp.
122,1.
17-22.
generally
Testimony
of
Chris
McClure
on
June
30,
2009;
and
Respondent’s
Exhibit
4,
Expert
Report
of
Christ
McClure.
33
i.
Moving
Press
4
to
Michigan
should
be
rejected
as
a
compliance
alternative
Packaging’s
first
alleged alternative
was
the
option
to
shut
down
Press
4
and
move
it to
Michigan.
As
noted
by
Mr.
Styzens
in
his
testimony
at
hearing,
however,
this
option
fails
to
take
into
account
the
entire
period
of
noncompliance
from
1997
to
2003.166
Packaging
did
not
purchase
the
Sparta,
Michigan
plant
until
late
2002.167
This
alternative,
therefore,
would
not
have
been
a
viable
option
in
1997,
1998, 1999,
2000,
2001
and
most
of
2002.
This
option
also
does
not
take
into
account
the
fact
that
Press
5
was
also
out
of
compliance
with
Section
218.401.168
As
testified
to
by
Mr.
Bloomberg,
and
acknowledged
by
Mr.
Trzupek,
Packaging
did
not
demonstrate
compliance
to
the
Agency
on
Press
5
until
it
purchased
the
$250,000.00
RTO,
connected
it
to
Press
5 and
completed
a
stack
test
per
the
requirements
of the
regulations.’
69
Additionally,
though
physically
possible,
it
is
unrealistic
that
Packaging
could
have
sustained
its
business
with
the
operation
of only
one
solvent-based
press
even
if Press
5
had
been shown
to
be
compliant.
By
the
time
Press
4
was
decommissioned
in
December
2002,
Packaging
had
been
running
two
solvent-based
printing
lines
for
more
than
seven
years.’
7
°
In
2004,
Packaging
installed
Press
6
and
resumed
operating
with
two
solvent-based
printing
lines,
which
it continues
to
do
to
this
day.’
71
‘Hearing
Transcript,
June
29,
2009,
at
p.
128,
1.
14-22.
Id.,
at
p.
220,
1.
20-23.
168
See
discussion
in
Section
III.G
herein.
169
Heating
Transcript,
June
29,
2009,
at
p.
45,
1.
3
—
p.
47,
1.
4
(Bloomberg
testifying
that
the
informal
test
on
the
recirculating
drying
oven
was
inadequate
to
demonstrate
compliance,
but
the
formal
test
on
the
RTO
in
early
2004
did
establish
compliance
with
the
regulation);
Complainant’s
Exhibit
8,
Letter
from
Huff&
Huff;
and
Transcript,
June
29,
2009,
at
p.
26,
1.
8
-
27,
1. 1
(Trzupek
acknowledging
that
a
formal
test
is
required
and
one
was
not
conducted
until
the
RTO
was
170
installed).
Answer
to
Amended
Complaint,
Count
I,
par.
6
(establishing
that
Press
4
was
installed
in
1992
and
Press
5
in
1995,
and
both
presses
operated
through
the
end
of
2002).
‘‘
Complainant’s
Exhibit
5,
Admitted
Fact
No.
15.
34
In
its
submittals
to
the
Agency,
Packaging
never
represented
that
it
intended
to
merely
shut down
Press
4,
but
asserted
that
it
would
“replace”
Press 4
and
add
a control
device.
Specifically,
in
making
an
attempt
to demonstrate
compliance
with
Part
218,
Respondent
made
the
following
statement:
Packaging
Personified
complies
with
the
above
referenced
rule
[218.401-
218.404]
by
the
following
methods:
*
*
*
Press
4:
This
unit
does
not
currently
comply
with
the
requirements
of
the
flexographic
printing
rule.
As
previously
indicated
to
the
Illinois
EPA,
this
press
will
be
withdrawn
from service
and
replaced
with
a
new
press
that
would
be
controlled
by
a
thermal
oxidizer....
172
This
mutual
understanding
is
confirmed
by
the
Construction
Permit
issued
for
Press
6
in
June 2003,
which
states:
This
permit
is
hereby
granted
to
the
above-designated
Permittee
to
CONSTRUCT
emission
unit(s)
andlor
air
pollution
control
equipment
consisting
of
one
flexographic
printing
press
(Comexi
press)
as
replacement
of
existing
press
#4,
and
one
regenerative
thermal
oxidizer
(RTO)
controlling
one
new
press
(Comexi
press)
and
one
existing
press
(press
#5),
as
described
in
the
above-referenced
application.’
73
ii.
Obtaining
an
adjusted
standard
should
be
rejected
as
a
compliance
alternative
Packaging
asserts
that
its
second
alternative
for
achieving
compliance
was
to
obtain
an
adjusted
standard
from
the
Board.
This
alternative
is
speculative
and
does
not
provide
a
justifiable
basis
for
calculating
economic
benefit.
Packaging
does
not
have
a
reliable
rationale
for
presuming
that
it
would
have
been
granted
an
adjusted
standard.
Other
companies
that
sought
an
adjusted
standard
made
lengthy,
costly
and
robust
demonstrations
to
the
Board
under
sworn
testimony
and
subject
to
cross-examination.
72
Complainant’s
Exhibit
13,
Letter
to
Agency
re
Demonstration
of
Compliance
dated
May
2,
173
2003.
Complainant’s
Exhibit
3,
2003
Construction
Permit,
p.
1.
35
Respondent
has
not
undergone
this
rigorous
demonstration;
it has
never
petitioned
for
an
adjusted standard;
and
it
should
not
be
credited
for
having
made
such
a
showing
to the
Board)
74
This
is
especially
true
considering
that
the
company
was
not
complying
with
any
of
its permitting
and
reporting
requirements
and
did
not
respond
to
the
Agency’s
outreach
in
1997.175
Although
Packaging
claims
that
it
did
not
receive
the
1997
letter
and
information
packet, the
Illinois
EPA
sent
the
outreach
letter
to the
company
at
its
Carol
Stream
address,
where
it
has
operated
for
34
years,
and
directed
the
letter
to
the
attention
of
Dominic Imburgia,
who
was
the
president
of
Packaging
at
that
76
Moreover,
other
companies
not
only
responded
to
the
Illinois
EPA’s
outreach,
but
had
contacted
the
Agency
prior
to
1997
in order
to
alert
the
Agency
of their
compliance
concerns.’
77
These
companies
proactively
sought
to cooperate
with
the
Illinois
EPA
which
Packaging
has
not
done
and
should
not
be
credited
for
having
done.
An
adjusted
standard
is
extraordinary
relief
that
is
beyond
the
scope
of
the
economic
benefit
analysis.
It
is not
a means
of
achieving
compliance
with
environmental
regulations
but
of
avoiding
compliance
with
a
particular
rule
or
regulation.
Part
2 18.401
provides
within
the
regulations
the
option
for
achieving
compliance
with
its
requirements.
It
identifies
three
distinct
options:
ensure
that
only
compliant
inks
are
used,
utilize
a mixture
of
inks
that
are
able
to
comply
with
the
VOM
restrictions
by
“‘
Complainant’s
Exhibit
5,
Admitted
Fact
No.
54.
175
See
generally
discussion
in
Section
III.A
—
III.L
herein
regarding
periods
of
noncompliance
with
applicable
regulations;
Hearing
Transcript,
June
29,
2009,
at
p.
49,
1.
2-18
(Bloomberg
testifying
to
Packaging’s
failure
to
respond
to
the
Agency
176
outreach).
Hearing
Transcript,
June
29,
2009,
at
p.
48,
1.
8
—
p.
49,
1.
1
(Bloomberg
testifying
to
the
1997
letter
being
sent);
Hearing
Transcript,
June
29,
2009,
atp.
186,1.
17-21
(Dominic
Imburgia
testifying
as
to
length
of
time
at
the
Carol
Stream
address);
Complainant’s
Exhibit
4,
Cover
Letter
for
1997
Information
Packet;
and
Complainant’s
Exhibit
5,
Admitted
Fact
Nos.
68-70
(location
and
president
of
Packaging
in
1997).
‘“Hearing
Transcript,
June
29,
2009,
atp.
43,1.
9-16,
24
—p.
44,
1.
6.
36
Electronic Filing - Received, Clerk's Office, September 24, 2009
means
of
a daily weighted average
or
install
a
control
device.’
78
Packaging
did,
in
fact,
install
a
control device,
just
as
the
regulation
anticipates,
and
this
action should
be
assessed for
purposes
of
the
economic
benefit analysis.
iii.
Purchasing
a
used
RTO
should
be
rejected
as
a
compliance
alternative
The
third
option
alleged
by
Packaging
to
be
a viable compliance
alternative
is
the
purchase
of
a
used
RTO large
enough
to
control
only
one
press.
This
“alternative”
fails
for
multiple
reasons.
As
in the
“move
to
Michigan”
alternative,
this
option
fails
to
account
for
the
fact
that
Press
5
was
not
in compliance
with
the
Flexographic
Printing
Rules
and
that
it
is
unlikely
that
Packaging
could
have
sustained
its
business
with
only
one
solvent-based
printing
line.’
79
Packaging
has
been
operating
with
two
solvent-based
presses
at
most
times
since
1995,
and
the
bulk
of
its
production
is
done with
solvent-
based
inks
on
the
printing
lines
designed
for
this
type
of
printing.’
80
Additionally,
accepting
a
smaller
used
RTO
as a
basis
for
calculating
economic
benefit
is
inconsistent
with
the
principle
that
the
best
estimation
of
a
company’s
lowest
cost
alternative
is
what
the
company
actually
did.
As
discussed
in
guidance
literature
on
this
issue, the
presumption
is
that
a company
will
make
business
decisions
that
are
efficient
and
effective,
that
create
the
most
benefits
to
the
company
for
the
lowest
costs:
The
best
evidence
of
what
the
violator
should
have
done
to
prevent
the
violations
is what
it
eventually
did
(or
will
do)
to
achieve
compliance.
This
rule
is
instructive
in
those
cases
where
the
violator
may
appear
to
be
installing
a more expensive
pollution
control
system
than
EPA
staff
believe
is
necessary
to
achieve
compliance.
In such
situations,
the
proper
35
Iii.
Adm.
Code
218.401.
See
discussion
in
Section
III.G
herein
(Press
5
not
in
compliance).
‘
80
Answer
to
Amended
Complaint,
Count
I,
par.
6
(establishing
that
Press
4
was
installed
in
1992
and
Press
5
in
1995,
and
both
presses
operated
through
the
end
of
2002);
Complainant’s
Exhibit
5,
Admitted
Fact
No.
15
(Press
6
installed
in
2004);
and
Hearing
Transcript,
June
30,
2009,
at
p.
15,
1.
2-4
(Trzupek
testifying,
“I
don’t
know
the
exact
percentage,
but
I
think
on
an
annual
basis
even
then
99
percent
of
their
[Packaging’s)
inks
were
solvent-based
inks.”)
37
cost
inputs
in
the
BEN
model
are
usually still
based
on
the
actual
(more
expensive)
system
being
installed.
This
is
because
the
EPA
should not
second
guess
the
business
decisions
of a
violator.
A
violator
often
will
have
sound
business
reasons
to
install
a
more
expensive
compliance
system
(e.g.,
it
may
be
more
reliable,
easier
to
maintain,
or
have
a
longer
useful
life).
181
On
January 10,
2003,
Respondent
purchased
an
RTO
for
$25
0,000.00.182
This
is
what
the
company actually
did.
The
evidence
confirms
that
Packaging
was
making
the
decision
that
was
in the
best
economic
interests
of
the
company.
Packaging
evaluated
multiple
options
at
the
time
it made
the
decision
to
purchase
the
$250,000.00
RTO.’
83
As
Joe
Imburgia,
the
General
Manager
of Packaging,
testified,
“at
one
point
in
time
it
was
floated
that
we
[Packaging]
would
continue
to operate
press
four
and
buy
a
used
small
oxidizer
and
I
generally
had
no
interest in
that.”
84
This
is
also
consistent
with
the
testimony
of
Mr.
Bloomberg
regarding
the
problems
that
other
companies
have
encountered
after
purchasing
used
control
systems)
85
iv.
Conclusion
For
all
of
these
reasons,
Packaging’s
alternative
economic
benefit
scenarios
should
be
rejected.
Respondent
received
an economic
benefit
from
delaying
the
installation
of the
$250,000
RTO
and
avoiding
the
costs
of
its
operation
and
maintenance
for
seven
years.
It
should
not
be
allowed
now
to
avoid
the
leveling
effect
of
being
disgorged
of
its unfair
economic
advantage
over
its
competitors
who
made
the
necessary
expenditures
to
comply.
181
Respondent’s
Exhibit
4,
Expert
Report
of
Chris
McClure,
Attachment
8,
US
EPA
“BEN
User’s
Manual”
at
3-9.
‘
Complainant’s
Exhibit
6,
Invoice
for
Purchase
of
183
RTO.
Hearing
Transcript,
June
29,
2009,
at
p.
234,
1.
18—p.
234,
1.
24.
Id.
at
p.
191,
1.
19-21
(position)
and
p.
234,
1,
22-24
(quote
regarding
used
equipment).
‘
Id.
at
p.
54,
1.
6-22.
38
Electronic Filing - Received, Clerk's Office, September 24, 2009
4.
The
civil
penalty
requested
by
the
Complainant
is
necessary
to
deter
future
violations
of
the
Act
Deterrence
is
an important
objective
for the
Board
in
establishing
an
appropriate
civil
penalty,
even
where
a
violator
has
already
achieved
compliance)
86
Courts
have
found
that
the
Act’s
provisions
for
civil
penalties
is to
“provide a
method
to
aid
enforcement
of the
Act”.
In
People
of
the
State
of
illinois
v.
State
Oil
Company,
the
Board
found
that
imposing
a
civil
penalty
on
State
Oil,
who
continued
to
operate for
another
eight
months
after
receipt
of a
violation
notice,
served the
purpose
of
having
a
“prospective
deterrent
effect
on
current
and
future
Act
violators.”
188
In
this
case,
Packaging
failed
to
expend
resources
to
determine
its
legal
obligations
and
then
relied
on
that
ignorance
to
avoid
capital
investments
required
to
achieve
compliance.
While
other
companies
were
outreaching
to
the
Agency
to
work
on
compliance
plans,’
89
Packaging
was
not
expending
any
time
or resources
on
the
problem
of
excess
VOM
emissions.
It waited
14
months
after
the
October
2001
inspection,
and
ii
months
after
the
January
25,
2002
VN,
to
shut
down
Press
4.
Two
and
half
years
passed
after
the
2001
site
inspection
before
compliance
was
demonstrated
on
Press
5.
In
that
same
time
frame,
Packaging
spent
money on
acquiring
the
Sparta,
Michigan
facility
in
late
2002.
A substantial
monetary
penalty
would
encourage
future
compliance
by
Packaging
and
others
in
the
regulated
community.
It
would
provide
an
incentive
for
186
See
ESG
Watts,
Inc.
v.
Pollution
Control
Board,
283
111.
App.
3d
43,
51
(
4
th
Dist.
1996)
(Respondent’s
compliance
came
only
after
initiation
of
enforcement,
and
associated
hardships
imposed
on
Illinois
EPA
warranted
a
“stiff”
penalty
to
assure
deterrence).
187
Southern
Asphalt
Co.
V.
PCB,
60
Ill.
2d
204,
207,
326
N.E.2d
406,
408
188
(1975).
People
v.
State
Oil
Company,
PCB
97..103,
2003
WL
1785038
*13
(March
20,
2003)
(“Levying
a
civil
penalty
against
State
Oil
and
the
Anests
in
this
case
aids
in
the
enforcement
of
the
Act
because
it
informs
violators
that
they
may
not
delay
efforts
to
comply
with
the
Act
while
pursuing
sale
of
the
offending
property.”).
189
Hearing
Transcript,
June
29,
2009,
at
p.
43,
1.
9-16,
24
—
p.
44,
1.
6.
39
Electronic Filing - Received, Clerk's Office, September 24, 2009
similarly situated
companies to
keep
abreast
of information
on
their
environmental
obligations
and
take
seriously
their
VOM
control
requirements)
9
°
A
civil
penalty
that
recoups
the
full
economic
benefit received
by
Respondent,
and
includes
a
sizeable
component
for
gravity
and
duration,
will
serve
to
deter
future
violations
of the
Act.
The
portion
of
the
penalty
reflecting
gravity
and
duration
should
be
a
high
priority,
as
the
economic
benefit
component
serves
only
to level
the playing
field.
The
remainder
of the
penalty
ensures
that
the
‘decision
not
to comply
does
not
merely
delay
otherwise
identical
expenditures.
As
such,
a
civil
penalty
that
recoups
the
full
economic
benefit
and
assesses
additional
penalties
for
gravity
and
duration
is
a critical
disincentive
for
those
who
would
violate
the
Act.
A civil
penalty
of
at
least
$861,274.00
will
serve
to deter
future
violations
by
the
Respondent
and
to
otherwise
aid
in
enhancing
voluntary
compliance
with
the
Act
by
the
Respondent
and
other
persons
similarly
situated.
5.
Previously
adjudicated
violations
of
the
Act
Complainant
is
not
aware
of
any
previously
adjudicated
violations
of
the
Act.
6.
Voluntary
Self-Disclosure
Respondent
did
not
voluntarily
self-disclose
its
noncompliance
with
the
Act,
Board
Air
Pollution
Regulations
or its
Construction
Permit.
7.
Supplemental
Environmental
Project
This
factor
is
not
applicable
to
the
present
case
as
no
supplemental
environmental
project
has
been
proffered
by
Respondent
or
accepted
by
the
Illinois
EPA.
190 See,
ESG
Watts
Inc.
v.
PCB,
282 Ill.
App.
3d
43,
52,
668
N.E.2d
1015,
1021
(
4
th
Dist.
1996)
(“the
deterrent
effect
of
penalties
on
the
violator
and
potential
violators
is
a legitimate
goal
for
the Board
to
consider
when
imposing
penalties.”).
40
Electronic Filing - Received, Clerk's Office, September 24, 2009
VI.
REQUESTED
PENALTY
The
evidence
presented
at
hearing
showed
that
the
Respondent
received
an
economic
benefit of
$711, 274.00
resulting
from
the
delayed
installation
of
a
pollution
control
device
and
avoided
annual
costs.
The
civil
penalty
should disgorge
the
Respondent
of
its
full
economic
benefit
and
reflect
other
aggravating
factors
applicable
to
Respondent’s
eleven
violations
of
the
Act
and
Board
Regulations
occurring
over
a period
of
more
than
a
decade.
Complainant
requests
that
the
Board
impose
a
civil
penalty
of
no
less
than
$861,274.00
on
Respondent
for
the
violations.
VII.
ATTORNEY
FEES
AND
COSTS
Although
Complainant
believes
that
Packaging’s
continued
violations
clearly
satisfy
the
“willful,
knowing
or repeated
violation”
standard
contained
in
415
ILCS
5/42(f)
(2008),
Complainant
does
not
request
the
assessment
of
attorney
fees
and
costs.
Complainant
asks
the
Board
to
take
note
of
this
waiver
in its
assessment
of
an appropriate
civil
penalty.
VIII.
CONCLUSION
The
evidence
proves
that
Packaging
is liable
for
eleven
different
violations
of
the
Act
and
Board
Regulations
alleged
in
the
People’s
Amended
Complaint.
These
violations
persisted
for
over
a
decade and
resulted
in excess
VOM
emissions
in
an
area
classified
as
severe
ozone
nonattainment
As
shown
by
the
evidence,
the
Respondent
enjoyed
a
economic
benefit of
$711,274.00
by
delaying
and
avoiding
expenditures
that
were
necessary
to comply
with
the
Act
and
Board
Regulations.
Packaging
should
be
stripped
of
this
unfair
economic
advantage.
Because
mere
recovery
of
the
economic
benefit
would
only
serve
to
level
the
economic
playing
field,
a
significant
additional
41
penalty
must
also
be
recovered
to
ensure
that
there
is an
effective deterrent
against
future
violations.
The
number,
nature,
and
duration
of
Packaging’s
violations
warrant
a
civil
penalty,
in
addition
to the
economic
benefit,
of
at
least
$150,000.00.
Based
on
the
evidence
before
the
Board,
Complainant respectfully requests
that
this
Board
enter
an
order
finding
against
Respondent
as to
liability
on
Counts
I through
X
and Count
XII
of the
Amended
Complaint;
requiring
Respondent
to
cease
and
desist
from
future
violations
of
the
Act
and
Board
Regulations;
and
assessing
of
a civil
penalty
no
less
than
$861,274.00.
RESPECTFULLY
SUBMITTED
PEOPLE
OF
THE
STATE
OF
ILLINOIS
by
LISA
MADIGAN,
Attorney
General
of
the
State
of
Illinois
MATTHEW
3.
DUNN,
Chief
Environmental
Enforcement/Asbestos
Litigation
Division
ROSEMARIE
CAZEAU,
Chief
Environmental
Bureau
North
BY:
ICHOLE
CUNNINGI-I
PAULA
BECKER
WHEEL
CHRISTOPHER
J.
GRANT
Environmental
Bureau
Assistant
Attorneys
General
69
W.
Washington
Street,
#1800
Chicago,
IL
60602
(312)
814-3532
(312)
814-1511
(312)
814-5388
42
Electronic Filing - Received, Clerk's Office, September 24, 2009