BEFORE THE ILLINOIS POLLUTION CONTROL BOARD
PEOPLE OF
THE STATE OF ILLINOIS,
)
)
Complainant,
)
)
vs.
)
)
PACKAGING PERSONIFIED, INC.,
)
an Illinois corporation,
)
)
Respondent.
)
PCB 04-16
(Enforcement)
NOTICE OF ELECTRONIC FILING
PLEASE TAKE NOTICE that on December 3, 2009, Complainant filed its Reply brief
with the Office of the Clerk of the Illinois Pollution Control Board, by electronic filing. A copy
of Complainant's Reply is attached hereto.
PEOPLE OF THE STATE OF ILLINOIS
ex rei.
LISA MADIGAN
Attorney General
of the
State
of Illinois
BY:
~~
______________ _
Assistant Attorney General
Environmental Bureau
69
W. Washington Street, #1800
Chicago, Illinois 60602
(312) 814-5388
Electronic Filing - Received, Clerk's Office, December 3, 2009
BEFORE THE ILLINOIS POLLUTION CONTROL BOARD
PEOPLE OF THE STATE OF ILLINOIS,
Complainant,
v.
PACKAGING PERSONIFIED, INC., an
Illinois corporation,
Respondent.
)
)
)
)
)
)
)
)
)
)
PCB 04-16
(Enforcement - Air)
COMPLAINANT'S REPLY
NOW COMES Complainant, PEOPLE OF THE STATE OF ILLINOIS, by LISA
MADIGAN, Attorney General
of the State of Illinois, and hereby presents its Reply Brief.
I.
INTRODUCTION
Complainant has requested that the Board find the violations alleged in Counts I through
X, and Count XII
of the Amended Complaint, and dismiss Count XI. Complainant has also
requested a civil penalty in the amount of$861,274.00. The State's request is based on recovery
of $711 ,274.00, representing the economic benefit of noncompliance accruing to Respondent
Packaging Personified, Inc. ("Packaging").
In this case, disgorgement
of all economic benefit is reasonable and appropriate. There is
no evidence in the record to suggest that recovery of all the economic benefit of noncompliance
would create an unreasonable financial hardship. Packaging did not present any financial
information at hearing, and does not argue in its Response that it cannot afford to pay this
penalty. Therefore full recovery is appropriate pursuant to 415 ILCS 5/42(h) (3), and 5/42(h)
(7) (2008).
Electronic Filing - Received, Clerk's Office, December 3, 2009
Complainant also requests an additional gravity component of $150,000.00, and believes
that
is request is also reasonable and appropriate, given the number and duration of Packaging's
multiple violations.
In response, Packaging improperly claims that the State took unreasonable position in
supposed "settlement discussions", an issue which Board should not consider. Packaging also
presents economic benefit 'evidence' which conflicts directly with its own expert's sworn
testimony in previous Board proceedings. Packaging's arguments cannot excuse its failure to
comply with the Act and Flexographic Printing regulations. The Board should assess a civil
penalty at least as large as that requested by Complainant.
II.
THE BOARD SHOULD STRIKE PACKAGING'S REFERENCES TO
"SETTLEMENT"
In an attempt to distract the Board from the relevant penalty factors, Packaging argues
that the State has been "unwilling to accept a settlement offer that is appropriate based on the
circumstances and similar caselaw .... "
(Response,
p. 2). This argument is irrelevant and
Improper.
At this point in the case, the Board will determine whether the violations have been
established and,
if so, will apply the Act's penalty factors in calculation of an appropriate civil
penalty,
if any. While the Board has acknowledged that settlement discussions could
possibly
be relevant ifthey represent a Respondent's good faith efforts toward compliance with technical
requirements
I,
that is not present in this case-Complainant is only seeking an appropriate civil
penalty. Packaging is simply attempting to prejudice the State's case by claiming that the State
was unreasonable in settlement discussions. Such a claim has no relevance to the Section 33(c)
'People v. Wayne Berger et aI,
PCB 94-373 (May 6, 1999, slip op., at 5).
2
Electronic Filing - Received, Clerk's Office, December 3, 2009
and 42(h) factors. The Board should strike the improper references to settlement on pages 2,33,
37, and 41 of Packaging's Response.
III.
THE CASES CITED BY RESPONDENT DO NOT SUPPORT ITS CLAIM OF AN
"UNREASONABLE" PENALTY
Packaging repeatedly refers to the settlements in four Board enforcement cases involving
printing companies
2
•
This reference is surprising because these cases do not support
Packaging's arguments. In fact, the settlements reinforce the appropriateness of the penalty
sought by Complainant. Significantly, in all four cases the State ensured that the requirements
of
415 ILCS 5/42(h) were satisfied by recovering all ofthe economic benefit of the Respondents'
noncompliance. The penalty sought by the State in this case does the same: almost 83%
of the
requested civil penalty is directed toward recovery
of the proven economic benefit.
In the
Golden Bag
case, only $3,200.00 of the $20,000.00 civil penalty represented
recovery
of the economic benefit of noncompliance. Unlike our case, the financial benefit
recovered
was derived from avoided permit fees, not from failure to operate a required control
device. The Stipulation accepted by the Board also noted that the
Company's ability to pay a
penalty was considered
3
. In our case, there is no evidence of an inability to pay the requested
penalty.
Similarly, in
Bag Makers
there is no reference to the need for control of volatile organic
material
("V OM") or avoided costs for failure to install a control device. Rather, the economic
benefit
of$700.00 was for unpaid permit fees, and represented only one (1) percent of the
$62,700.00 civil penalty. Unpaid permit fees were also the sole economic benefit in the
2The cases are
People v. Golden Bag Company,
PCB 06-144;
People v. Bag Makers. Inc.,
PCB 05-192;
People v.
Aargus Plastics. Inc.,
PCB 04-09;
People v. Fellowes Manufacturing Company alkJa Fellowes Inc.,
PCB 04-193
3 PCB 06-144, Stipulation filed 8/21109, p.7
3
Electronic Filing - Received, Clerk's Office, December 3, 2009
Fellowes
case, where economic benefit of $1 0,750.00 represented no more than six (6) percent
of the $189,250.00 penalty. There is no reference to avoided YOM control expenditures.
Respondent's claim that the
Aargus
case was settled "on the basis that they had moved their
facility to a new facility
... "
(Response,
p.14) also ignores the fact that the case was resolved only
upon the recovery
of all of the economic benefit of noncompliance through civil penalty4.
This case
is more analogous to
People
v.
Ferrara Pan Candy Company. Inc.,
PCB 02-
185. In that case, the Parties stipulated to economic benefit of$371,688.00 from failure to
install and operate a YOM control devices. All
of this economic benefit was recovered through
civil penalty.
Respondent maintains that " .... it
is up to the Board to ensure that the law is applied
consistently amongst the regulated entities"
(Response,
p.22). Complainant
is in full agreement.
To do so the Board must ensure that, at a minimum, all
of the economic benefit of
noncompliance is recovered: in this case at least $711,274.00. In accordance with the cases cited
by Respondent, the Board should also recover an additional component for the duration and
gravity
of the multiple violations.
IV.
PACKAGING DID NOT KEEP THE REQUIRED RECORDS
Packaging admits its failure to produce requested records to Illinois EPA inspectors
6
.
However, it claims that the 'information' was available in "MSDS [Material Safety Data Sheets]
sheets and its daily production records (i.e., job tickets) that track the output of sold products to
4The
Aargus
matter did not go to hearing. and therefore there is no evidence in the record about the source of the
economic benefit or whether avoided
YOM control costs were included. However. the Stipulation filed in
settlement provides that " .. the [$125,000.00] penalty obtained negates the economic benefit accrued". Stipulation
and Proposal for Settlement, p.8, PCB 04-9, accepted by the Board June 15, 2006.
5S
ee
: Stipulation
and Settlement Agreement filed in PCB 02-185 on
9112/02,
p.7
4
Electronic Filing - Received, Clerk's Office, December 3, 2009
customers ... ,,7.
It
weakly attempts to shift the blame to the Agency, stating that the 'records'
were "not in the form Illinois EPA would have preferred". In other words, Packaging asserts that
'records' would be compliant
ifit was possible for an Illinois EPA inspector to:
1)
Search for MSDS records at a regulated facility, and then search through the
MSDS sheets for YOM content information;
2)
Cross-reference the MSDS information to daily "job tickets";
3)
Identify from each ticket the YOM content
of each ink used for each particular
run each day;
4)
Identify and compile the YOM content
of each printing job each day; and
5)
Assemble the daily, monthly and annual reports that Packaging had failed to
compile.
Packaging's interpretation
of the term "records" is unreasonable and overbroad.
Clearly, the term "records" as used in the Flexographic Printing Regulations means new
records compiled from the raw information, not the information
itself. The fact that
the information was available to Packaging from daily job tickets made and kept for
business purposes, simply shows that the raw information was available to it, and that
Packaging's failure to comply with the report and recordkeeping requirements (and its
construction permit) was either an intentional violation, or grossly negligent.
6Complainant's Exhibit 5, Requests No. 60
&
62.
7Packaging Response, p.
17
gAs admitted by Packaging witness Tim Piper, manufacturers were required to keep MSDS sheets well before the
promulgation of the Flexographic Printing Rules in 1993.
Tr. 6/30109,
p. 257. The fact that 35 III. Adm. Code
218.404 makes no reference to MSDS sheets clearly indicates that newly compiled records were required after the
effective date.
5
Electronic Filing - Received, Clerk's Office, December 3, 2009
V.
THE ADJUSTED STANDARDS GRANTED TO FORMEL, BEMA AND VONCO
DO NOT PROVIDE A DEFENSE
TO PACKAGING
Packaging admits it failure to comply with the Flexographic printing regulations and
related sections
of the Act
(Response,
p.2). However, it represents that this failure was
"inadvertent", and the result
of ignorance
9
.
Packaging also tries to blame Illinois EPA for
Packaging's own noncompliance by attacking Illinois
EPA's 1997 outreach to the regulated
community. Packaging claims that the Agency "".never followed up with a phone call to
Packaging to confirm whether it had received the notice and information packet"
(Response,
p.
5). These claims misrepresent the record, and demonstrate a continued refusal to accept
responsibility.
The YOM control, record keeping, and reporting requirements of the Flexographic
Printing Rules were adopted by the Board on September 9, 1993, with a compliance date
of
March 15, 1995 10. Packaging had more than eighteen (18) months to learn of the compliance
deadline, evaluate its emissions, and determine its compliance status. Instead it did nothing.
Beginning March 15, 1995, Packaging was operating in violation of the Board rules and the Act.
Other regulated printers were not so negligent. Mr. David Bloomberg, Illinois EPA
Bureau
of Air Compliance Unit Manager, testified that Illinois EPA was contacted by affected
flexographic printing companies regarding problems they were having coming into
~ompliance
9 Packaging repeatedly refers to itself as a "small family-owned company", but the evidence shows that it is neither
"small" nor "family owned". Packaging has 100 employees at its Du Page County facility alone, while Formel
Industries, Inc., which was fully aware of the Flexographic Printing Rules and worked with Illinois EPA toward
compliance, had only 20-25 employees.
Petition of Formel1ndustries. Inc.,
AS-13 (January 18, 200 I, slip op., at
3.). As acknowledged by co-owner Dominick Imburgia, Packaging is not solely family owned.
Tr.,
6/29/09, p.190.
1°35 III. Adm. Code 218.106(c)
6
Electronic Filing - Received, Clerk's Office, December 3, 2009
with the rules
II.
The Agency decided to determine the scope of the problem within the printing
industry, assembled a list
of printers, and mailed a letter offering assistance to the affected
companies. Packaging was one
of the affected companies, and was sent a copy of the letter
l2
.
Packaging's claim that Illinois EPA was required to go further and perform telephone
follow up on non-responders
is absurd, and ignores an important underlying fact: Illinois EPA
was under no obligation to perform its outreach. The Agency was going 'above and beyonq' its
duties in an effort to encourage voluntary compliance. However, Packaging had an
independent, affirmative duty to learn
of the regulations affecting its business, and comply with
the law.
Mr. Bloomberg testified that three
of the flexographic printing companies who were
working with Illinois EPA subsequently obtained adjusted standards from the Board, although all
have been subsequently withdrawn 13. He also confirmed that Packaging eventually discussed an
adjusted standard with Illinois EPA. However, Packaging was seeking a retroactive adjusted
standard at that time, which would have extinguished seven years ofviolations
l4
.
The Agency
should not, and in Mr. Bloomberg's experience does not support such requests
l5
.
Finally, nothing prevented Packaging from seeking an adjusted standard without the
Agency's support.
In its discretion, the Board will grant or deny an adjusted standard petition
IITr.
6/29/09,
p.47.
12Tr.
6/29/09,
pp. 48-49. See also: Complainant's Exhibit 4
13
Tr., 6/29/09,
p.50. The three printing companies were Formel Industries, Inc., Vonco Products, Inc., and Bema
Film Systems, Inc. All three companies have since installed VOM control equipment.
Id.
14
Tr
., 6/29/09,
p. 93
151d.
Even the adjusted standards granted to the
cooperating
printers did not extinguish liability. Formellndustries,
Inc. was subsequently assessed a penalty by USEPA for its prior noncompliance.
Tr., 6/29/09,
p. 96.
7
Electronic Filing - Received, Clerk's Office, December 3, 2009
with our without the support of Illinois EPA 16. If it believed that it could have met its burden,
Packaging could have requested an adjusted standard without the Agency's agreement. Instead,
it decided on the easiest and most practical solution: the long-delayed installation
of a thermal
oxidizer.
VI.
PRESS NUMBER 5 WAS NOT COMPLIANT UNTIL CONNECTED TO THE
THERMAL OXIDIZER IN 2004
Packaging repeatedly argues that Press No.5 at its facility was in compliance with the
YOM control requirements
of the Flexographic Printing Rules 17. The evidence at hearing
showed the opposite. The evidence showed that Packaging knew that it had to demonstrate
compliance in accordance with the regulations, and made a decision not to perform compliance
testing. The evidence also shows that, once it installed its thermal oxidizer, this 'compliant'
press was immediately connected to the control system. Control
of Press 5's YOM emissions
was only demonstrated once its emissions were vented through the newly-purchased regenerative
thermal oxidizer ("RTO").
To verify 'compliance', Packaging was required by
35 Ill. Adm. Code 21S.404(e)(l) to
perform testing according to 35 Ill. Adm. Code 21S.105(c)-(h). As described by David
Bloomberg, this included strictly following the listed test methods, prior submission
of a
protocol to IllinoisEP
A, notice to the Agency to allow it to witness the tests, and submission of
an appropriate test report
l8
. Packaging did none of these. After performing what it referred to
as an 'informal emissions test' on Press
No.5, Packaging submitted a letter regarding the 'test'
16See,
e.g.
Petition o/Citgo Petroleum Corp. et aI.,
AS 08-8 (December 18,2008).
17Packaging applies the term: 'substantive compliance'.
ISTr.,
6/29/09, p. 45
s
Electronic Filing - Received, Clerk's Office, December 3, 2009
to the Attorney General 19, not to Illinois EPA. As described by Mr. Bloomberg, the testing
described in the letter was "not even close" to being an acceptable verification
of compliance
2o
.
Neither was Packaging's prior claim (from its CAAPP Permit application) that Press 5 was in
compliance from a "manufacturer's warranty", nor Mr. Trzupek's "engineers estimate,,21.
Packaging now claims that a 'drying oven' on Press
5, which was designed to quickly dry
off volatile material for faster printing22, could also act as a control device and would sufficiently
control YOM emissions to comply with the regulations. However, having made the decision
not to perform compliance testing until after the emissions were routed to the RTO, its claims
cannot be accepted as valid. The Board should find that Press 5 was noncompliant throughout
the
rdevant period.
VII.
PACKAGING REALIZED AN ECONOMIC BENEFIT OF AT LEAST $711,
274.00
FROM ITS VIOLATIONS
In its economic benefit of noncompliance calculations, Complainant has focused
exclusively on the delayed and avoided expenditures realized from the late installation
of the
RTO. Clearly, Packaging also realized a benefit from its failure to obtain construction and
operating permits, from its failure to make and keep records, and from other violations.
However, Complainant believes that recovery
of the requested civil penalty, which includes the
$711,274.00 economic benefit from failure to control YOM emissions, will sufficiently address
all
of the violations.
19Complainant's Exhibit 8
2°Tr.,
6/29/09,
pp. 45-46
2IId.,
at 46
22Tr.,
6/29/09,
p. 25
9
Electronic Filing - Received, Clerk's Office, December 3, 2009
Complainant has also limited the economic benefit recovery to the period 1997 through
December
5,2003 (plus interest), despite the fact that Packaging was required to control its
YOM emissions beginning March 15, 1995. Complainant's estimate is therefore conservative.
A.
Complainant's Estimate Is an Accurate Representation of the Avoided Costs
Complainant's expert Gary Styzens applied a methodology used to estimate BEN in
several other Board cases, notably the
Panhandle Eastern
case. His calculations are based on
initial capital cost, annual operating costs, and an appropriate interest rate. There is no dispute
regarding the capital cost
of the installed RTO ($250,000.00), nor any valid objection to Mr.
Styze:ns' use
of the prime interest rate. The only dispute regarding the economic benefit estimate
relatf:s to the annual operating cost
of the RTO.
Mr. Styzens is highly qualified
to render an accurate opinion in this matter. He obtained
a Masters in Business Administration in 1983, and became a Certified Internal Auditor in 1988.
His
is intimately familiar with the financial analysis involved in evaluating the economic benefit
of noncompliance. In the past 10 years, he performed this analysis in at least 25 cases
23
. He is
also very familiar with the litigated economic benefit cases and the federal guidance materials.
He has provided expert testimony in four Board hearings, and one circuit court matter. Finally,
Mr. Styzens
is not a paid expert: he performed his analysis as part of his regular position as
Economic Benefit Analyst and Manager.
Mr. Styzens developed his operating cost analysis in consultation with Illinois EPA
Bureau
of Air Compliance Unit Manager David Bloomberg, who was uniquely qualified to
prov:ide accurate information. Mr. Bloomberg is an engineer who supervises other Bureau of Air
2J
T
r., 6/29/09, p. 129
10
Electronic Filing - Received, Clerk's Office, December 3, 2009
engim~ers,
and had dealt with the regulated community on compliance and YOM control issues
affecting the flexographic printing industry since at least 1997
24
.
Between 1997 and 2000, Mr. Bloomberg worked with the flexographic printers who had
come to Illinois EPA for assistance. As part
of this outreach effort, he reviewed YOM control
cost information submitted by technical consultants working for the printers seeking assistance.
One
of these consultants was Rich Trzupek, who had been working on compliance issues with
Formel Industries, Inc. since 1997
25
•
Mr. Trzupek prepared RTO operating cost information on
behalf
of Formel, and provided the information to Mr. Bloomberg for review
26
.
Mr. Bloomberg
understood the information to represent an accurate estimate
of actual operating costs
27
.
A
summary of the cost information submitted to the Agency is found in
Respondent's Exhibit 57.
Mr. Trzupek's calculations indicated that the annual operating costs for an RTO at
Formel (excluding recovery
of the RTO capital cost) would be $147,429.00. Taxes, insurance
and administration costs are included in this annual cost estimate. But even
if these
'accounting' costs are excluded, Mr. Trzupek's estimate shows that the
'real' annual operating
cost for an RTO would still be $91,520.00. Mr. Styzens reduced this even further, and used an
average annual operating cost of$86,000.00 for Packaging's avoided annual RTO operation
cost. Mr. Styzens' annual cost estimate is based on cost information submitted to Illinois EPA
and reviewed by the Agency's senior technical staff. Mr. Styzens' estimate also conforms to
24Tr.,
6/29/09,
p.43
25
Tr
., 6/29/09,
p. 32
26
Tr.,
6/30109,
p.158
27/d.
I 1
Electronic Filing - Received, Clerk's Office, December 3, 2009
USEPA guidance in this area, which provides:
"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,,28.
By using the actual cost of the RTO that Packaging used for compliance, and
operating costs developed in consultation with David Bloomberg, Mr. Styzens' estimate is
reasonable, conservative, and accurate.
B.
Packaging Grossly Understates Operating Costs
Packaging's estimate of RTO annual operating costs is inadequate and self -serving. Mr.
Trzupek's testimony completely and utterly conflicts with his prior sworn testimony and must be
deemed unreliable. Because the avoided annual operating costs constitute the largest segment
of
the economic benefit to be recovered, Packaging's motives in trying to minimize these costs are
obvious. But to state, as Mr. Trzupek did at hearing, that RTO operating costs are only
10% of
the amount claimed in his prior sworn testimony, is to insult the intelligence of Illinois EPA and
Mr. Trzupek contradicted his prior sworn testimony in many regards. For example, at
hearing in this case, he testified that an RTO control unit is "not a significant electrical
user,,30.
However, in the cost information provided to Illinois EPA, and used as the basis of his testimony
in seeking an adjusted standard for Formel, he indicated that an
RTO's electrical cost would
28
Respondent's Exhibit 4,
BEN Users Manual,
p. 3-9.
29
Th~:
testimony at hearing focused mostly on Mr. Trzupek's testimony in the Formel Industries, Inc. adjusted
standard petition, because those operating cost numbers were used in Complainant's economic benefit calculations.
However, Mr. Trzupek also provided sworn testimony in the Vonco Products, Inc., and Bema Film Systems, Inc.
adjusted standard hearings. In Vonco, he testified that an RTO would be the least costly control system, with an
annual cost of $34, 156.00 per ton of controlled YOM . AS 00-12, (11115/00, p.37). In the Bema hearing, he again
testified that an RTO would be the least expensive, with an annual cost of $15,233.00 per ton of controlled YOM.
AS 00-11 (11/13/00, p. 35). At the Formel hearing, he testified that the RTO would be least expensive, with an
annual cost of $1 0,911.00 per ton of controlled YOM. AS 00-13
(11114/00,
p. 35). Complainant used the operating
cost information from Formel because, as the least expensive estimate of the three, it resulted in the most
conservative estimate of economic benefit.
3°Tr.,
6/30/09,
p. 41
12
Electronic Filing - Received, Clerk's Office, December 3, 2009
amount to $41,061.00 per year31 . Thus, the electrical cost alone represented 28% of the total
annual operating cost, and almost 45%
of the annual operating cost once "taxes, insurance,
administrative" costs were subtracted. ObviousJy, electrical costs for the RTO are not
'insignificant' .
In a weak attempt to explain the gross deviation from his prior testimony, Mr. Trzupek
claimed that the information he presented to Illinois
EPA for review (and used at hearing before
the Board in the adjusted standard hearings), did not represent an " actual cost", and that the
"EP A methodology for RACT and BACT purposes is much higher ... delivers much higher costs
than the real world32." However, in his rebuttal testimony, David BlooJTIberg (who reviewed
these same cost estimates on
behalf of the Agency), stated that the figures presented by Mr.
Trzupek were not represented as a 'fiction', but were approximated accurate operating costs
33
.
Mr. Bloomberg also testified that the numbers would not be significantly different
if USEP A's
RACT analysis was applied
34
.
Mr. Trzupek's attempt to explain away his prior testimony was a
complete failure.
In fairness to Mr. Trzupek, his estimate
of$15,000.00 annual operating cost (or less than
$1,000 per ton
of controlled YOM) was for Press 4 only, and for operation of a hypothetical,
small
'used' control device that was neither purchased nor installed
35
. Obviously, all ofMr.
3lRespondent's Exhibit 57
32Tr., 6/30/09, pp. 56-17
33Tr., 6/30/09, p. 158
34
1
d.
35Tr.,
6/30/09, p.100
13
Electronic Filing - Received, Clerk's Office, December 3, 2009
Trzupek's testimony regarding the 'hypothetical' control device is pure speculation, and not
entitled to serious consideration by the Board.
No real RTO operating cost data was ever generated by Packaging. As testified by Mr.
Styzens, he had sought the information from Packaging on several occasions, but received
nothing
36
.
Because Complainant's economic benefit estimate is based on information reviewed
by IIIlnois EPA, and submitted under oath in a prior Board proceeding, Complainant's estimate
of annual operating costs is conservative and accurate.
C.
Packaging's Alternative 'Compliance' Options are Unreasonable
Packaging attempts to tum the established concept of economic benefit of noncompliance
on its head by proposing several 'compliance' alternatives, each with its own minimized cost.
None
of these 'alternative' scenarios would have resulted in actual compliance with the Act and
Flexographic Printing regulations, and therefore must be rejected by the Board.
I.
Shutting down Press
No.4, or moving it to Michigan
The pertinent regulations apply
to emission sources within the Chicago ozone- .
nonattainment area
37
.
Clearly, if Packaging had no emission sources, the regulations would not
apply to its operations. However, it did have noncompliant emission units (including both Press
No.4 and Press No.5) during the relevant period and it did operate in violation of the
Flexographic Printing Rules for many years. As shown by Complainant, this resulted
in a large
economic benefit.
36Tr., 6129/09,
p. 119.
37
35 111. Adm. Code 218.103
14
Electronic Filing - Received, Clerk's Office, December 3, 2009
Packaging did not acquire its Michigan facility until late 2002, seven years after it
became subject to the Flexographic Printing Rules
38
.
Obviously, operating Press 4 in Michigan
could not have been the "lowest cost alternative for achieving compliance" during most, or all
of
the noncompliance period. Also, Packaging's argument is the same as claiming that if a
company never operated, it would have spent no money on compliance measures, and therefore
realized no economic benefit. That does not mean that the Board should accept 'non-operation'
as a compliance alternative.
If accepted, this absurd argument would provide a defense to all
environmental violations.
2.
Adjusted Standard
As previously noted, Packaging never applied to the Board for an adjusted standard, and
passed on several opportunities to do so. The Board should find that Packaging waived any
right to an adjusted standard by its inaction, and should not consider an unfiled adjusted standard
petition as an 'alternative means
of compliance'. However, even if Packaging had obtained an
adjusted standard, it would not have come into compliance with the Flexographic Printing
Rule:; ..... they simply would not apply to Packaging.
An adjusted standard is "
...
an alternative standard granted by the Board in an
adjudicatory proceeding pursuant
to Section
2B.1
of the Act and
35
Ill. Adm. Code
104,
Subpart
D. 1he adjusted standard applies instead of the rule or regulation of general applicability. 35
Ill. Adm. Code 101.202. An adjusted standard " ...
has the effect of an environmental regulation
that would apply
to petitioner,
if
granted, in lieu of the general regulation that would otherwise
be applicable
to a petitioner and the regulated community.
35 Ill. Adm. Code 104.400.
38 Tr.,
6/30109,
p. 220
15
Electronic Filing - Received, Clerk's Office, December 3, 2009
Packaging never applied for or obtained an adjusted standard. Therefore, it was always
bound by the 'general regulation', i.e. the control requirements
of the Flexographic Printing
Rules.
If it had been able to meet its burden and obtain an adjusted standard (no sure bet...of all
the printers who cooperated with Illinois EPA, only three obtained adjusted standards), it would
not have 'complied' with the Flexographic Printing Rules control requirements-those
requirements would not apply to them.
3.
Installation of a Used RTO
Packaging's argument that it 'could have' installed a used controller for 'Press
No.4
only'" is similarly flawed. First, the argument ignores the fact that Press No.5 was also out of
compliance throughout the relevant period, and did not come into compliance until connected to
the (new, larger) RTO in late 2003-early 2004. Second, the cost information used
in
Packaging's calculations is pure speculation. The $75,000.00 'cost' was provided twelve (12)
years after the control regulations became applicable to Packaging's business. The sole
"evidence" is a one page letter from Ship
&
Shore Environmental Inc., dated June 15,2007
39
.
The letter refers to a hypothetical purchase in 2003, eight years after Packaging was required to
be in compliance. No one from Ship
&
Shore was named as a witness by Packaging, and none
testified at hearing. There is
no evidence that such a 'used' device was even available during
the
pl~riod
of Packaging's noncompliance.
Finally, it is clear that Packaging had no interest
in a 'used' device, and therefore it
cannot reasonably
be considered as an alternative. Packaging's Plant Manager testified that
prior to their eventual purchase
of the RTO, a "small used oxidizer" had been proposed, but that
39 Respondent's Exhibit 44.
16
Electronic Filing - Received, Clerk's Office, December 3, 2009
he "had no interest in that,,4o. Obviously, Packaging did not believe that a used oxidizer would
fit
thdr business. The only logical measure of Packaging's avoided compliance costs are the
costs
of the RTO installed in late 2003.
VIII.
PACKAGING'S CURRENT PERMIT ISSUES ARE IRRELEVANT
Complainant seeks penalties for Packaging's violations during the period described in the
Amended Complaint.
It
does not seek p,enalties for action or inaction after July 11, 2005.
However, Packaging dedicates a significant portion of its Response to permit issues now pending
with the Agency. For example, Packaging claims that Illinois
EPA's alleged "failure to issue
Packaging an operating Permit has frustrated Packaging's ability to fully comply with the
regulations,,41. The "permit" referred to is a FESOP Permit applied for in Packaging's 2006
amended FESOP application, and has absolutely nothing to do with this case. Packaging's
admitted noncompliance with the regulations refers to
present
noncompliance, not the
noncompliance alleged in the Amended Complaint.
It
may be that Packaging is attempting to
confuse the Board about its past noncompliance, or is seeking to gain sympathy based on its
current problems with the Agency. Neither
is appropriate. If Packaging believes it is being
treate:d unfairly on current permit issues, it has the option
of appealing the Agency's permit
decisions to the Board.
If it is currently in violation of the ERMS regulations, and such
violation results in a second enforcement action, it can raise these defenses at that time.
Packaging has admitted its failure to obtain the construction, operating, and CAAPP
permits that are relevant to this case
42
. Packaging's arguments regarding the Agency's current
4°Tr.,
6/30109,
p. 235
41
Response, p. 15
42 See: Complainant's Exhibit No.5
17
Electronic Filing - Received, Clerk's Office, December 3, 2009
position on its FESOP application, and its dispute regarding ATU's and the ERMS program are
just not relevant, and should not be considered by the Board.
IX.
CONCLUSION
For the reasons set forth herein and in Complainant's Post-Hearing Brief, Complaint
requests that the Board find the Respondent, Packaging Personified Inc., in violation as alleged
in Counts I through X, and Count XII of the Amended Complaint, assess a civil penalty against
the Respondent in an amount no less than $861,274.00, and order such other
relief as the Board
deems appropriate.
BY:
RESPECTFULL Y SUBMITTED
PEOPLE OF THE STATE OF ILLINOIS
by
LISA MADIGAN,
Attorney General of the State of Illinois
MATTHEW 1. DUNN, Chief
Environmental Enforcement/Asbestos
Litigation Division
ROSEMARIE CAZEAU, Chief
ISTOPHER GRANT
A LA BECKER WHEELER
L.
NICHOLE CUNNINGHAM
Environmental Bureau
Assistant Attorneys General
69 W. Washington Street, #1800
Chicago, Illinois 60602
(312) 814-5388
(312) 814-1511
(312) 814-3532
18
Electronic Filing - Received, Clerk's Office, December 3, 2009
BEFORE THE ILLINOIS POLLUTION CONTROL BOARD
PEOPLE OF THE STATE OF ILLINOIS,
)
)
Complainant,
)
)
vs.
)
)
PACKAGING PERSONIFIED, INC.,
)
an Illinois corporation,
)
)
Respondent.
)
PCB 04-16
(Enforcement -Air)
CERTIFICATE OF SERVICE
I, CHRISTOPHER GRANT, an attorney, do certify that I caused to be served this 3d day
of December, 2009 the foregoing Reply and Notice of filing upon the persons listed below, by
placing same in an envelope bearing sufficient postage with the United States Postal Service
located at 100
W. Randolph, Chicago Illinois.
Service List:
Mr. Roy Harsch
Ms. Yesenia Villasenor-Rodriguez
Drinker Biddle Reath
191 N. Wacker Drive, Suite 3700
Chicago, Illinois 60606
Mr. Bradley
P. Halloran
Hearing Officer
Illinois Pollution Control Board
100
W. Randolph
Chicago
IL 60601
CHRISTOPHER GRANT
Electronic Filing - Received, Clerk's Office, December 3, 2009