ILLINOIS POLLUTION CONTROL BOARD
March
21,
1996
ESG WATTS, INC., an Iowa Corporation,
)
)
PCB
94-243
Petitioner,
)
94-306
)
94-307
v.
)
94-308
)
94-309
ILLINOIS ENVIRONMENTAL
)
95-133
PROTECTION AGENCY,
)
95-134
)
(Consolidated)
Respondent.
)
(Permit Appeal
-
Land)
CHARLES J.
NORTHRUP APPEARED ON BEHALF OF THE PETITIONERS;
DANIEL P. MERRIMAN AND JOHN BURDS APPEARED ON
BEHALF OF
RESPONDENT.
OPINION AND ORDER OF THE BOARD
(by C.A.Manning):
This matter is
before the Board on seven consolidated permit appeals filed by ESG
Watts, Inc.
(Watts).
These permit appeals were consolidated by
a June
1,
1995
order of the
Board because they involve a common issue of law:
whether the Illinois
Environmental
Protection Agency
(Agency) appropriately denied these permits
based upon Section 39(i) of the
Environmental Protection Act (Act).
Section 39(i) requires the Agency
to conduct an
evaluation of the prior waste management
operational experience of landfill operators in
Illinois and
allows the Agency to deny waste management permits to
an operator who has a
history of,
among other things,
“repeated violations of federal,
State or local laws,
regulations,
standards, or ordinances in the operation of refuse disposal
facilities or sites.”
(415 ILCS 5/39(i) (1994).)
Watts
is the operator of three landfills
in Illinois:
a
landfill in Viola, Illinois
(Viola
Landfill) which is
in closure; a landfill in Springfield,
Illinois
(Sangamon Valley Landfill)
which is
temporarily closed; and a landfill in Rock Island County, Illinois,
(known as the
Taylor Ridge or Andalusia landfill) which
is currently in operation.
The seven
instant permit
appeals all relate to permit denials for the Rock Island
County
facility.’
The Agency’s
‘Of the seven permit appeals at issue,
one relates to the Agency’s August 18,
1994 denial ofa
generic waste stream for nine waste streams (PCB 94-243).
The other six appeals relate to
separate waste streams permit denials for disposal ofspecific types ofwaste:
wastewater
treatment sludge decided October 7,
1994 (PCB 94-306); waste sulfur cement decided September
22,
1994 (PCB
94-307); button dust decided September 22,
1994 (PCB 94-308); paint sludge
decided October 7,
1994 (PCB 94-309); calcium sulfite cake decided March 23,
1995
(PCB
95-
133); and buffing dust waste decided February 28,
1995 (PCB 95-134).
2
decisions for each of the permit applications were made within the statutory
time frames for
Agency decision and
all seven appeals were timely filed with the Board within 35
days of the
Agency’s decisions.
In all
seven permit denial letters,
the Agency stated as a denial reason:
“(b)ased on ESG Watts, Inc.’s prior history of repeated violations of State laws, regulations
and standards concerning the operation of refuse disposal facilities or sites,
the Agency,
by the
authority granted in Section 39(i) of the Act and
to avoid violating
35 Ill.
Adm.
Code
807.207(a) and
(b),
is denying these permit applications.”
While the Agency additionally
set forward several technical grounds for the denial of
six of the seven permits at issue,
it is clear from the record and arguments of this proceeding
that the major thrust of the Agency’s denial is
the application of Section 39(i).
The Agency
itself admits that these technical denial points were,
in large part, the result of minor errors
and omissions in
the permit application which, but for the fact the permit would be denied
anyway based on the Section 39(i)
issue,
the permit reviewer would have contacted the
permittee to correct.2
Additionally, it is
clear from our review of the record that most of the
information
missing from the applications could have been deduced from the application in
general.
For
these reasons, the Board
finds
that the technical denial reasons are neither
appropriately supported by the record nor dispositive of the Section 39(i)
issue.
Therefore,
the
Board
finds
the technical denial reasons to be insufficient to warrant denial and they will not
be examined further in this opinion.
On December
5,
1995
a hearing was held before Board
Hearing Officer Deborah
Frank.
There were no members of the public present at that hearing.
Watts filed its post-
hearing brief on January
12,
1996.
The Agency filed a brief on February
7,
1996.
The Board
granted a motion to file the brief instanter and denied a motion to exclude the brief in an order
of February
15,
1996.
The reply brief was timely filed by Watts on February 23,
1996.
For
the following reasons, the Board hereby affirms the Agency’s permit denial
as to all seven
permit
appeals.
LEGAL FRAMEWORK
The Permitting Process
The Environmental Protection Act establishes a
system of checks and
balances integral
to the Illinois
system of environmental governance.
Concerning the permitting function,
it is
the Agency who has the principal administrative role under the law.
Specifically, the Agency
has the duty to establish and administer a permit process as required by the Act and
regulations, and the Agency
has the authority
to require permit applicants to
submit plans,
specifications and reports regarding actual or potential
violations of the Act, regulations or
2
At hearing, the permit reviewer, Krishna Brahmamdam, testified that in this case, he probably
would have contacted the applicant to have Watts repair the minor deficiencies; however, he did
not do so because the permit would be denied anyway. (Tr. at 137-138.)
3
permits.
(Landfill,
Inc.
v. IPCB
(1978) 74 Ill. 2d 541;
25 Ill. Dec.
602,
607,
citing,
415
ILCS
5/4.)
Further,
the Agency has the authority to perform technical,
licensing and enforcement
functions.
It
has the duty to collect and disseminate information, acquire
technical data, and
conduct experiments.
It has the authority
to cause inspections of actual or potential pollution
sources and the duty to
investigate violations of the Act,
regulations and
permits.
(Id.
at 606)
Regarding permits,
the Act provides that it
“shall be the duty of the Agency to
issue
such a permit upon proof by the applicant that the facility will not cause a violation of this
Act
or ofregulations hereunder.”
When the Agency makes a decision to deny a permit,
the Act
provides
that it must transmit to the applicant a detailed statement as to the reasons for the
denial.
The statement shall include,
at a minimum, the sections of the Act or regulations
which
may be violated if the permit were granted; the specific type of information,
if any,
which the Agency deems the applicant did not provide the Agency;
and
a statement of specific
reasons why the Act and the regulations would be
violated if the permit were granted.
(415
ILCS
5/39 (a)(1)-(4)(1 994).)
Finally,
the Act charges that the Agency
“shall adopt such
procedures as are necessary to carry out its
duties under this
the
permitting
section.”
(415
ILCS 5/39
(a)(1994).)
After the Agency’s final decision on the permit is
made, the permit applicant may
appeal that decision to
the Board.
(415 ILCS
5/40(a)(1)(1994).)
The Board then holds
a
hearing between the parties at which the public may appear and offer comment.
The question
before the Board in a permit appeal
is
whether the applicant has met its burden ofproving that
operating under the permit as issued would not violate the Act or regulations.
(Oscar Mayer
v.
IEPA,
PCB 78-17, 30 PCB
397,
398
(1978);
John
Sexton Contractors
Company v.
Illinois
(Sexton),
PCB 88-139, February
23,
1989;
Browning-Ferris Industries of Illinois,
Inc.
v.
Pollution Control Board,
179 Ill.
App.
3d
598,
534 N.E. 2d 616,
(2nd Dist.
1989).)
It is
well-settled that
our review in most types ofpermit appeals,
including this one,
is not
de novo
but is
limited to information submitted to the Agency during the Agency’s statutory review
period,
and is
not based on information developed by
the permit applicant, or the Agency,
after the Agency’s decision.
(See Alton Packaging
Corporation
v.IPCB,
(5th Dist.
1987) 162
Ill. App. 3d.
731;
516
N.E. 2d 275, 280.)
However, it is the hearing before the Board that
provides a
mechanism for the petitioner to prove
that operating under the permit as granted
would not violate the Act or regulations.
Further,
the hearing affords the petitioner the
opportunity
“to challenge the reasons given by the Agency for denying such permit by means
of cross-examination and the Board
the opportunity to
receive testimony
which would
‘test the
validity of the information relied
upon by the Agency’.”
(Alton Packaging
Corporation
v.
IPCB
(5th Dist.
1989)
162 Ill. App. 3d 731;
114 Ill.
Dec.
120,
quoting JEPA
V.
IPCB,
115
Ill.
2d at 70.)
Under the Act, both the Agency and the Board operate under tight statutory decision
time frames.
The Agency’s statutory time to
issue a permit decision is
90 days and for the
Board,
it is
120
days unless
waived by the petitioner.
4
Section 39(i)
as a Basis for Permit Denial
The permit denials pending before the Board are based on Section 39(i) ofthe Act
which
specifically provides:
Before issuing
any RCRA permit or any permit for the conduct of any waste-
transportation or waste-disposal operation,
the Agency
shall conduct an evaluation of
the prospective operator’s prior experience in waste management
operations.
The
Agency may deny such a permit if the prospective operator or any employee or officer
of the prospective operator has a history of:
1.
repeated
violations of federal,
State, or local laws, regulations, standards,
or
ordinances in the operation of refuse disposal facilities or sites; or
2.
conviction in this or another State of any crime
which is
a felony under the laws
of this State or conviction of a felony in a federal court; or
3.
proof of gross carelessness or incompetence in handling,
storing, processing,
transporting or disposing of any hazardous waste.
(415 ILCS
5/39(i)(1994).)
The legislative history of Section 39(i) reveals that the legislature wished to give the
Agency an opportunity
to examine a permit
applicant’s background and,
in the case ofrepeat
problems, to deny that
permit applicant a permit.
The legislative
debate also makes clear that
the legislature thought it was important to provide this
opportunity
at the
“hearing” level
and
that it not be mandatory for the Agency
to deny the permit when it found repeated violations
to
exist.
The legislative
debates provide the following discussion about Section 39(i):
Senator Joyce:
This amendment.
.
.
currently the problem with this
as we read in
the papers,
and are hearing about that we’re having trouble identifying unscrupulous
dumpers or operators of waste disposal
sites that.
.
.
in the permit process.
What this would do,
is let the people who are granting the permits go
into the
applicant’s background for possible previous violations,
they’re not a part of the
application proceedings right now.
A case in point, the Metropolitan Sanitary
District’s, Pollution Control Chief has pointed out
that one of the main
problems
is that existing law makes no mention of an applicant’s background,
or possible previous
violations during the application process.
What this
would
do is.
.
.
is
let them go into the application.
.
.
applicant’s background and
check on him, and if he has been creating a problem for many times,
they
would.
.
.
they could not give him the.
.
.
the permit.
(P.A.
81-1484.
Senate
Tr.
June 19,
1980.)
Senator Joyce:
Mr. President and members of the Senate, this
amendment goes along with the
amendment I offered the other day.
It says that no permit for refuse collection
5
or refuse
disposal operator shall be issued
by the EPA until background for
applying the operator has been evaluated.
The amendment I put on
the other
day
went along.
.
.
said that the EPA could refuse the operator certification on
this basis.
Well, it turns
out that the EPA is
not certifying at the present time;
they intend
to in the future, but this would
let them do the same thing with the
permit.
Just say, that for repeated violation of Federal, State and local
regulations,
convicted of a felony or proof of carelessness or incompetence in
dealing with hazardous waste.
(P.A.
81-1484 Senate Tr.,
June 23,
1980.)
Senator Grotberg:
Yes, Senator Joyce represents it exactly the way it is.
The only reason I am not
violently opposing this
amendment is
it’s permissive,
and they may deny,
not
shall deny; but it does make sense at a hearing level to have something like
this
in the Statute,
and I have no objection to
it.
(P.A.
81-1484 Senate Tr.,
June 23,
1980.)
The Agency has not had much experience in
making decisions pursuant to Section
39(i),
neither has the Board had an opportunity to review a
Section 39(i) denial.
The first time
the Agency
attempted to exercise its
authority pursuant
to this section,
its decision was quickly
challenged in the district court on constitutional
grounds as it had
attempted to deny permits
for mere allegations of wrongdoing instead of adjudicated violations.
The federal district
court,
in
Martell
v.
Mauzy,
511
F. Supp. 729
(N.D.
Ill.
1981), entered an
injunction against
the Agency prohibiting the Agency from applying
Section
39(i) to a permit application on the
basis of alleged violations.
The court stated that the history ofpast violations
must be based
upon adjudicated violations, not
violations in the eye ofthe Agency alone.
The court further
held that a permit holder possesses certain property and liberty interests in the renewal ofa
permit,
and is
therefore entitled to certain due process protections.
(Martell,
511
F. Supp. at
729.)
In a similar vein, this
Board, on October 29,
1992 rejected a prior Agency attempt to
deny
seven permits
to this very operator, Watts, also based upon mere allegations as opposed
to adjudicated violations.
(ESG Watt, Inc.
v. IEPA
(October 29,
1992) PCB 92-54,
aff’d,
IEPA
v. IPCB
(3rd Dist.
1993) 252 Ill.
App.
3d
828,
624 N.E. 2d 402.)
As the court held
before us in
Martell,
we found that it was improper to deny operating permits
on the basis
of
alleged violations rather than adjudicated ones. (PCB 92-54, Slip op.
at 9.)
While we do not
believe the present case presents any
issues of constitutional infirmity, we are nonetheless
cognizant that permit
applicants have a great stake in the Agency’s Section 39(i) decisions.
Because this
is an
issue of first impression before the Board, we must
first determine
whether the traditional standard of review normally reserved for permit denials
is
appropriate
for analyzing a Section 39(i) denial.
The parties urge the Board to adopt a very different
standard of review for the portion of the Agency’s decision denying the permit based on
Section 39(i).
The parties ask that we adopt the exceptionally deferential
“arbitrary and
capricious” standard of review, which we note
is normally reserved forjudicial review of the
6
Board’s decisions when we are performing a quasi-legislative function.3
(Pet.
Br.
at
6-7;
Ag.
Br.
at 11-12.)
Under an arbitrary
and capricious standard, our scope of review would be
severely limited and
we could not reverse the Agency’s decisions absent a
“clear error of
judgment, or unless the Agency’s decision
is so implausible that it could not be ascribed to
a
difference in view or even the product of agency expertise.”
(Greer v.
Illinois Housing
DevelopmentAuthority,
122
Ill.2d 462;
524 N.E.2d 561,
581;
120 Ill. Dec.
531,
551
(Ill.
1988),
citing, Motor Vehicle Manufacturers Association of the United States, Inc.
v.
State
Farm Mutual Automobile Insurance Co.
(1983), 463
U.S.
29,
43,
103
S.Ct.
2856,
2866-67.)
The parties’ reasons for supporting this
standard are obvious.
The Agency
believes that the
arbitrary and capricious standard is
consistent with its
ability to make a purely “discretionary
decision”
with only limited Board review,
while the petitioner believes the standard would
require the Board to reverse the Agency’s decision based on the Agency’s lack of adopted
rules or procedures for analyzing a prospective operator’s prior conduct.
We decline to
adopt the arbitrary
and capricious
standard and instead we will review
the Agency’s Section 39(i) decision applying the same level of deference normally accorded
the Agency in permit appeals.
Section 40 of the Act specifically mandates that the Board
review Agency
decisions made pursuant to Section 39
of the Act.
Agency decisions to deny
a
permit pursuant to Section 39(i) are thus also reviewable by the Board pursuant to
Section 40
and 35 Ill. Adm.
Code
Section
105.102(a).
Thus
it is the petitioner’s burden to prove both
that he is
entitled to the permit and that
the Agency’s stated denial
reasons are either
insufficient or improper.
Importantly,
we wish to emphasize that the Pollution Control Board and the Agency,
together,
are an
“administrative continuum” particularly in the area of permit issuance and
appeals.
Permitting decisions made by
the Agency are not subject to judicial
scrutiny until
such time as we enter a final administrative
decision.
At that time the Board’s decision is
reviewed under the
“manifest weight of the evidence” standard.
(IEPA
v.
IPCB,
(3rd Dist.
1985)
138
Ill. App. 3d
550,
486
N.E. 2d 293,
294;
aff’d, IEPA
v.
IPCB
(Ill.
1986)
115
Ill.
2d
65,
503
N.E. 2d
343.)
We do not review the Agency’s decision pursuant to the manifest
weight standard because ofthe special administrative
review relationship set forward in the
Act.
(IEPA
v. IPCB,
(3rd Dist.
1985) 138 Ill. App. 3d
550,
486 N.E. 2d 293,
294;
aff’d IEPA
v. IPCB
(Ill.
1986) 115
Ill. 2d
65,
503
N.E. 2d 343.)
Instead, as part of this administrative
continuum,
we hold hearings and allow for a development of the issues which may not
have
been adequately developed
in the short 90-day decision deadline imposed on the Agency’s
permitting decisions.
Since there was no hearing below, we would be abdicating our
statutory
~Examples are the Board’s promulgation of rules
(Granite
City
v. IPCB,
(Ill.
1993)
155
Ill. 2d
149,
613 N.E.2d 719,
184 Ill.Dec.
402); interpretation of rules
and defining scope of emission
standards
(IEPA
v. IPCB
(1st Dist.
1983) 118
Ill. App.
3d 772,
455
N.E.
2d
188;
IEPA v.
IPCB
(Ill.
1981) 86 Ill. 2d 390,
427 N.E.
2d
162,
167);
and, fashioning remedies
in
enforcement actions
(Discovery South
Group,
LTD et al.
v. IPCB and
Village ofMatteson
(1st
Dist.
1995), 275 Ill. App.
3d
547,
656
N.E.
2d 51.)
7
responsibility if we were to examine this case with the narrow review dictated by the arbitrary
and capricious
standard.
However, because the information reviewed by the Agency
in denying a permit
pursuant to Section
39(i) is
different from the information considered by the Agency
in
imposing conditions or denying a permit based on the merits of a permit application,
the
Board’s review of such a denial is
necessarily different in certain respects.
Unlike our review
of other permitting decisions wherein the Board must determine whether there will be
prospective compliance with the Act and/or Board regulations,
reviews of Section 39(i)
decisions look solely at the operating history of the prospective operator and what has already
transpired.
It is
therefore not necessary for the Board to analyze whether issuance of the
permit will cause a violation of the Act or Board
regulations
in relation to a Section
39(i)
denial.
Additionally, Section 39(i) requires the Agency to conduct an evaluation of the
prospective operator’s prior experience in waste management
operations and to apply the
legislatively-defined criteria to the waste management record ofthe operator.
Therefore,
it is
not only the operating history of the permit applicant but the Agency ‘s analysis thereof, which
fonns the record which we review in
Section
39(i)
decisions.
In reviewing Section
39(i)
decisions, the Board must determine whether the applicant’s operating
history
warrants denial
ofthe requested permit due to:
1) repeated violations of federal,
State,
or local laws or
regulations; 2) conviction of a felony in this or any other state; or 3) proof of gross
carelessness or incompetence
in handling,
storing, processing, transporting, or disposing of
any hazardous waste.
The burden is
on petitioner to show that the Agency
incorrectly
determined that denial of the permit
is
warranted in considering the above factors.
FACTUAL AND PROCEDURAL BACKGROUND
History of Adjudicated Violations
In denying the seven permits at
issue here, the Agency cited only the first of the three
possible
statutory reasons for denial:
the repeated
violations of State, federal and local laws
and
regulations.
It relied upon numerous adjudicated violations wherein Watts had been found
guilty,
over a period of some seven years,
of violating various provisions
of the Act.
Clearly,
the most important and egregious of those violations
involved the circuit court’s adjudication
of numerous violations
by Watts in
its operation of the Sangamon Valley Landfill.
Additionally, there are some
19
different administrative citations which had been adjudicated
against Watts by the Illinois Pollution Control Board,
concerning operations at all three of the
Watts-operated landfills.
In this
section, the Board will examine the facts contained in the
record and in the relevant proceedings concerning these matters.
The Sangamon Valley Landfill Adjudication
One ofthe single, highest penalties assessed against a
landfill operator in the
State of
Illinois
was levied against Watts for its operation ofthe Sangamon Valley Landfill.
The
circuit court of Sangamon County found Watts in
violation ofthe Act and corresponding
8
regulations just six
months prior to the Agency’s first permit denial of theses instant permit
appeals.
(People v.
Watts
Trucking,
et al,
No.
91-CH-242 (Cir.
Ct.
Sangamon Cty
Feb.
2,
1994);
R.
94-243 at 128-131.)
On February
2,
1994 the circuit court assessed penalties of
$350,000 and found Watts liable for violating the Act and regulations
on all
twelve counts of
an
amended complaint filed by the Agency
and the Illinois Attorney General and later joined
by the Sangamon County
State’s Attorney.
The complaint alleged substantial violations ofthe
Act and regulations,
and alleged facts concerning disregard of the legal requirements for
operating a
landfill for a period of over three years.
The violations ranged from Watts’
exceedence of the vertical and horizontal permit
limitations for placement ofwaste in the
landfill, to
Watts’ failure to construct a clay liner in certain portions of the landfill as required
by the permit and the regulations,
to Watts’ actual allowance of leaching, which in turn,
impacted the groundwater at the site and eventually caused water pollution.
A list of the violations included 44 violations of Section 21(o)(5) and (o)(6) concerning
daily and
intermediate cover;
35 violations of Section 21(o)(12) of the Act and the regulations
at
35 Ill.
Adm.
Code
Section 807.306 concerning litter;
36 violations of Sections
21
(o)(l),
21(o)(2), 21(o)(3) and
the regulations at Section 807.3 14 concerning
leachate flow;
continuing
violations
of 12(a) for water pollution,Section
2 1(d) and Section 807.3 13,
Section 620.301(a)
for groundwater violations,
Section
12(a) and
12(f) for NPDES violations
concerning water
pollution,
Section 9.1(d) for asbestos NESHAP violations,
Section 24 of the Act and Section
901.102 for noise
violations; and
additionally,
violations
concerning financial assurance and
various
fee payment provisions.
(R.
94-243 at 83-127.)
While denying the complainants’ request for permanent injunctive
relief from further
violations of the Act, the court felt that the $350,000
in penalties was necessary in order to
insure Watts would bring the landfill in compliance.
The court directed Watts to undertake
eight specific actions in “strict compliance with Agency permits”:
1.
The excavation and proper construction and/or repair of all sections ofthe liner
that have not been certified.
2.
The construction of berms
as required by permit.
3.
The installation of best available technology for noise control on all heavy
equipment.
4.
The implementation of the groundwater remediation program as required by
permit.
5.
The excavation and appropriate disposal of all refuse
previously deposited in
unpermitted lateral and vertical areas of Area
1.
6.
The initiation of closure of
Area
1,
including (but not limited to)
the provisions
of final cover in accordance with approved contours
and the control of all
leachate
seeps, in
compliance with the approved closure and post-closure care
plan.
7.
The implementation of the surface water control system as required by
permit
unless,
in the determination of the Agency, such project is
superseded by
closure activities.
9
8.
The removal from adjacent properties of all
silt, debris and refuse attributable to
the landfill’s operations.
(R.
94-243 at
129-131.)
Administrative Citation Adjudications
The Agency further cited
19
separate administrative citations as supporting permit
denial on the basis of Section 39(i).
The adjudicated violations concerned operational
deficiencies at all three of Watts’ landfills in Illinois
over a seven-year period from
1987
through 1994.
The most recent citation concerned operational deficiencies which occurred at
the Sangamon Valley Landfill three months prior to the Agency’s first of the seven permit
denials in August of 1994.
In these
19
cases,
the Board,
which is
the only jurisdiction
authorized under Section 31.1 of the Act to decide
administrative citation cases,
found Watts
liable for 44 separate
violations of Section 21(o) of the Act.
Section 21(o)
is the Act’s general
prohibition against operation of a sanitary landfill in an unlawful manner and this section lists
several possible violation points from Section 21(o)(1) through (o)(13).4 Pursuant to the
administrative citation process set forward in Section
21
and Section 31.1,
these final decisions
were made based either on a hearing on the merits
or as a result of Watts having defaulted on
the cases.
In addition to finding Watts liable for 44 separate violations, the Board
additionally
assessed Watts a
total of $22,000 in penalties.
These penalties are statutorily provided for in
Section 42(b)(4) and
upon a determination of liability, the Act requires the Board to
impose a
pre-set $500 fine for each of the 44 adjudicated violations of the Act.
The total number of violations committed by Watts at the three landfills consisted of
nine violations of Section 21(o)(1) for refuse
in standing or flowing
waters; two violations of
Section 21(o)(2)
for leachate
flows entering the waters of the state;
two violations of Section
21(o)(3) for leachate flows exiting the landfill confines; 20 violations of Section
21(o)(5) for
uncovered refuse remaining from any previous operating day or at the conclusion of any
operating day;
two
violations of Section
21 (o)(1 1) for failure to
submit reports required by
permits or Board regulations and eight
violations of Section 21(o)(12) for failure to collect and
contain litter from the site by the end ofeach operating
day.
Specifically for each landfill, the
Board found that
Watts had committed 31
violations at the Sangamon Valley Landfill for the
period from 1987 through 1994;~four violations
at Viola in
1988;6 and eight violations at
Taylor Ridge from
1988 to 1990.~
~ Section 21(p) has been subsequently amended to Section 2 1(o) and therefore the administrative
citations at issue show violations of Section 21(p) in the record.
~ Specifically,
at the Sangamon Valley Landfill,
Watts was found liable for seven violations of
Section 21(o)(1), two
violations of Section 21 (o)(2), two violations of Section
21 (o)(3),
13
violations of Section 21(o)(5),
two violations of Section 21(o)(1 1) and
five violations of
Section
21(o)(12).
6
Watts committed two
violations of Section 21(o)(5) and two
violations of Section 21(o)(12).
10
The Agency’s Permit Review Process
According to the testimony presented at hearing in this matter, the Agency has different
procedures for reviewing different types of permit applications.
(Tr.
at 34-37.)
Initially,
the
permit is date stamped,
sent to a
log-in clerk and
assigned to a permit reviewer,
who makes a
recommendation to
his
or her immediate supervisor.
(Tr.
at 33.)
If the permit applied for
is a
supplemental generic permit
(PCB 94-243), various administrative
sections within the Agency
may be
notified and comments
may be solicited.
(Tr.
at
35,
102.)
Comments are not
mandatory,
and the permit reviewer may not always
receive comments.
(Tr.
at 39-41.)
If
comments are received, the permit reviewer would consider those comments
in making his or
her recommendation on the denial or the issuance of a permit.
(Tr.
at 97.)
It is the permit
reviewer’s decision whether or not to
seek out comments if none are received.
(Tr.
at 40-41,
107.)
If the permit
is a special
waste stream permit (PCB 94-306 through PCB 94-309 and
PCB 95-133 and 95-134), the Agency does not routinely
notify other administrative sections
within the Agency that a permit
application has been received.
(Tr.
at 36.) A final Agency
decision “is based upon the record of the applications under review, the recommendations of
the reviewer and the reviewer’s supervisor, as well as the collective input of any
others
who
may have been involved
in the review process, or who may have made comments
in response
to
a notification of pending Agency permit action.”
(Ag.
Br.
at 28;
Tr.
at 57-58, and 83.)
The seven permit applications at issue were
assigned by Agency Bureau of Land Permit
Section Manager, Edwin C.
Bakowski,
to Agency permit reviewer Krishna Brahmamdam for
technical review.
(Tr.
at 81.)
Mr. Brahmamdam recommended denial of the permit
applications.
(Tr.
at
96 and
130.)
Each recommendation to deny a permit was passed to Mr.
Brahmamdam’s supervisor for review and
then given to Mr.
Bakowski
.
(Tr.
at
57,
133-134.)
Mr.
Bakowski signed the Agency
denial
letters which
set forth the reasons for each permit
denial.
(R.
94-243 at 2-3;
R.
94-306 at 61-63;
R.
94-307 at 61-63;
R.
94-308 at 61-63;
R.
94-
309 at 61-63;
R.
95-133 at 60-62;
R.
95-134 at 60-62.)
Other
administrative sections
within the Agency were
notified about the application in
PCB 94-243.
(R.
94-243 at
3 1-48.)
Mr. Brahmamdam received
comments from the field
operations
section (FOS)
on the permit application in PCB 94-243.
(R.
94-243
at 61-69.)
Mr.
Brahmamdam considered the FOS
comment,
in his review ofthe remaining permits.
(Tr.
at
98,
102.)
During the technical review process,
the permit reviewer may
be
in contact with the
permit applicant to
solicit additional
information or seek clarification on certain points.
(Tr.
at
~Watts committed two violations of Section 21(o)(l),
five violations of Section 21(o)(5) and
one violation of Section 21(o)(12).
11
107 and 117.)
The permit reviewer generally determines whether or not to
call an applicant.
(Tr. at 110-111.)
In
Wells Manufacturing
Company v.
IEPA,
195
Ill. App.
3d
593,
142 Ill. Dec. 333,
552
N.E. 2d
1074 (1st Dist.
1990)
(Wells)
the court held that it is
improper for the Agency to
deny a permit based upon potential
violation of the Act
without providing the applicant an
opportunity to
submit information which would disprove the potential violation.
As a result of
the
Wells
decision, the Agency
provides permit applicants an opportunity to respond to
potential denial reasons prior to issuance of the denial letter.
This letter is commonly referred
to as a
“Wells
letter”.
The
Wells
letters were
sent on February
22,
1995
and the Agency
received Watt’s response on March
1,
1995.
(Pet.
Br.
at 21.)
The Agency’s one common denial reason for each of the seven permit applications was
Watts’ history of repeated
violations pursuant to Section 39(i) of the Act.
The Agency’s denial
of the permits pursuant to
Section 39(i) of the Act cited to
19
adjudicated
administrative
citation cases wherein Watts had been found in violation of the Act and a Sangamon County
circuit court case
People v.
Watts
Trucking et al.,
91-CH-242.
In this
case, Watts Trucking
and Watts were found in
violation of several sections of the Act and Board
regulations for
activities at the Sangamon Valley Landfill.
ARGUMENTS OF THE PARTIES
Sangamon Valley Landfill Adjudication
Watts maintains that the Agency’s reliance on the Sangamon Valley Landfill litigation
is
improper because that adjudication relates to that
specific landfill only,
and not to Taylor
Ridge.
Watts argues that with multi-site operators, it is
“inappropriate” to consider the
problems of other facilities as conclusive judgment of operations at Taylor Ridge when the
only relationship is common ownership by a corporate entity.
Watts asserts that landfill
personnel are different,
operational requirements are different,
permitting
requirements are
different,
local conditions
are different and State or county inspectors may be different.
(Pet.
Br. at 10.)
Additionally,
Watts argues
that during the time the Agency was reviewing the permit
applications at issue in this appeal,
significant discussions were ongoing between the Agency
and Watts concerning the Sangamon Valley Landfill.
(Pet.
Br.
at 14-15.)
Watts
asserts that
the Agency was cognizant of the Sangamon Valley Landfill progress, yet at the same time the
Agency denied the permit application at issue in this
matter.
(Pet.
Br.
at
15-16.)
Watts asks,
“Is the Agency
taking the position that once a “bad actor”
always
a “bad actor”
without any
opportunity
to revive
its
reputation?”
(Id.)
In response, the Agency
argues that the plain statutory language of Section 39(i) is
not
facility-specific and allows the Agency to deny a permit if the prospective operator has a
history of repeated violations
in the operation of refuse disposal
“facilil
or sites
-
plural.”
12
(Ag. Br. at
14-15.)
The Agency claims that
if its
inquiry into a prospective operator’s
“history of
repeated violations” was limited
to the facility for which
the permit is sought, then
any operator for a new facility could get a permit regardless of the operator’s prior history.
(Ag. Br. at 14-15.) The Agency states that it did consider Watts’ efforts to come into
compliance along with the
efforts that were expended by the State in bringing about that
compliance.
(Ag. Br. at 25.)
The Agency believes that Watts should not be
afforded
“special
deference” because,
Watts took
steps to comply with a court order. (Ag. Br. at
25-26.)
Administrative
Citation Adjudications
Watts asserts that,
in citing the
19 administrative citations, the Agency
failed to
consider that
they do
not relate whatsoever to the activities for which these permits are sought.
(Pet.
Br.
at 9.)
Watts argues
that only five ofthe
19
citations being considered are for
violations at Taylor Ridge,
despite 32
inspections by
Agency personnel since
1989,
and even
those range from six to ten years in age.
(Pet.
Br.
at
11-12.)
To bolster
its
argument,
Watts
points to
City ofEast Moline v.IPCB,
136 Ill. App.
3d 687,
91
Ill.Dec. 296,
483 N.E. 2d 642
(3rd Dist.
1985), wherein the appellate
court held
that the age of violations could be a
minimizing or eliminating factor in penalties.
(Id.)
Watts also asserts that the severity of the
violations adjudicated in
the administrative citations should be examined.
(Pet.
Br.
at 11.)
Watts maintains that even the Board has
recognized the
“minor nature of administrative
citations and has often referred to them as being analogous to
traffic tickets.”
(Pet.
Br.
at
12,
citing, In the Matter of: Lincoln Chamber of Commerce,
AC
89-26 (May 25,
1988) and
In the
Matter of: John R.
Vander,
AC 88-99 (March 9,
1989).)
Watts points out that
even the
Agency does not believe that administrative citations inand ofthemselves warrant refusal of
permits.
(Pet. Br. at 12,
citing,
Tr.
at 65.)
Watts also argues
that the Agency’s own rationale as to why the administrative citations
were considered is without merit.
(Pet.
Br.
at 13.)
Watts points
to the testimony of the
Agency’s solid
waste
branch manager,
Mr. Bakowski,
who testified that in considering the
administrative
citations,
“I guess you look at the way they’re considered is
the quantity
and the
severity collectively.”
(Tr. at 63; Pet. Br. at 13.) Mr. Bakowski went on to testify that with
regard to severity,
the Agency
would
look to the “willful
intents”
and the “environmental
jeopardy.”
(Tr.
at 63-64;
Pet.
Br.
at 13.)
Watts asserts the quantity of the administrative
citations should
be mitigated by the age of the administrative citations.
(Pet.
Br.
at 13.)
Using the two components defined by the Agency’s testimony,
Watts notes that neither
willfulness nor environmental jeopardy are discussed or adjudicated
in the
19 administrative
citations.
(Pet. Br.
at
13.)
For these reasons, Watts argues
that the Board
should
find that
administrative
citations do
not form the basis for denial pursuant
to Section 39(i) ofthe Act.
(Pet.
Br.
at 12.)
The Agency disagrees with Watt’s interpretation of Section
39(i)(1) that would
classify
the administrative
citations as “too minor” to warrant a denial of a permit pursuant to
Section
39(i) of the Act.
(Ag.
Br.
at 19.)
The Agency points
to the language
in subsections (2) and
(3),
and notes
that both refer to a singular event;
whereas in
subsection (1) the statute refers to
13
“repeated violations” of several legal requirements all ofwhich relate to the operation of a
refuse disposal
facility.
(Id.)
The Agency concedes that it is
the cumulative effect of the
“many adjudicated” administrative citations
“over time,
that made them relevant to the
Agency’s considerations ofWatts’
‘history of repeated violations”
and that there is
no
set
number which automatically triggered the Agency’s denial pursuant to
Section 39(i).
The Agency further disagrees that the violations relied upon by the Agency bear no
relationship to the permit
applications.
(Ag.
Br.
at 21.)
The Agency
states that the legislature
requires that the repeated
violations must pertain to the
“operation of refuse disposal
facilities
or sites”
without any other limitations upon
the relationship between the repeated
violations
and the permits being sought.
(Id.)
Accordingly, the Agency believes that to impose any
other restrictions
is
to go beyond
the requirements of the Act
itself.
(Ag.
Br.
at 22.)
Further,
the Agency asserts that the arguments by
Watts that many of the violations were for other
facilities, goes to the weight the violations were given by the Agency.
(Ag.
Br.
at 16.)
Regarding the “age” of the citations, the Agency
points
out that even though some of
the administrative
citations for Taylor Ridge are over
six years
old today, the first decision to
deny
a permit based
on those administrative
citations was made in
1994.
(Ag. Br.
at 17.)
Secondly, the Agency maintains there is
no age requirement in Section 39(i) regarding the
history of repeated violations.
(Id.)
Finally, the Agency asserts that
the arguments by Watts
ignores the “very concept ofexamining a ‘history” which would
require the Agency to
examine things in the past.
(Ag.
Br.
at 17.)
Th~
Agency maintains that in relying on
East
Moline,
Watts
is
seeking to have the Board inappropriately adopt enforcement principles to the
discretionary Section 39(i)
denial process.
(Ag. Br.
at
18.)
The Agency
asserts that the goal
in enforcement is future compliance; while the goal in the Section 39(i) denial
is future
cessation ofwaste
management operations.
(Ag. Br.
at 18.)
Other Considerations
The
WellsLetters
Watts asserts that
the Agency had determined to deny the seven permit applications
prior
to sending the
Wells
letters
making the
Wells
letters
a “sham,”
without any
“real
opportunity” for Watts to respond.
(Pet.
Br.
at 20.)
In support of this argument,
Watts
points
to the chronology of events in PCB 95-133 and PCB 95-134 which
indicates that the
reviewer knew the applications would be denied even before the
Wells
letters
were
sent,
in
addition to the reviewer’s testimony that
“(s)ince the application is being denied anyway
due to
past
adjudicated violations, I included this deficiency as a denial point.”
(Pet.
Br.
at 20-21;
Pet.
Exh.
3
and 4.)
Watts contends that
this is not
a “thought”
that the permit might be
denied; but a statement that
the permit would be denied.
(Id.)
Further, the permit reviewer
testified that he believed
this case may have been one where there was some fatal
defect which
was not going
to be corrected prior to the decision due date, therefore it did not make sense to
contact them to repair the minor deficiencies if the permit was going to
be denied anyway.
(Tr.
at
137-138; Pet.
Br.
at 21.)
14
The Agency claims that the responses to the
Wells
letters were considered.
(Ag. Br. at
33.)
The permit reviewer testified that he looked at the responses to the
Wells
letters,
discussed the responses with others at the Agency and considered the responses in making his
recommendation.
(Tr.
at 13 1-132.)
The Agency
contends that Watts’ responses to the
Wells
letters
did
not contest the history of past violations,
“nor did they describe measures that
Watts
had taken to ensure the non-recurrence of such violations.”
(Ag.
Br.
at 31.)
Rather, the
responses to the Wells letters informed the Agency why Watts believed the Agency should
ignore the past history of violations.
(Id.)
Interpreting the reviewer’s notes in PCB 95-133
and PCB 95-134, the Agency states that the permit reviewer’s
notes
do not constitute the
Agency’s final decision, but at best the reviewer’s thoughts ofdenial.
(Id.
at 32.)
The
Agency contends that at best the notes
indicate that the reviewer “thought”
the permit
would
be
denied, and with five other applications denied based on repeated
violations,
“any surmise
by the permit
reviewer” that the permits
would be denied
“does not seem patently
unreasonable.”
(Id.)
Unadjudicated Violations
Watts asserts that in this matter the Agency did in fact rely on factors “not envisioned
by Section 39(i)” of the Act.
(Pet.
Br.
at 16.)
Specifically, Watts asserts that the Agency
considered the failure of Watts to timely apply for a significant modification permit for the
Taylor Ridge facility even though at the time of these permit denials no violation had been
adjudicated for the failure
to file a significant modification permit.
(Pet.
Br.
at 17.)
In
support ofthis
argument,
Watts points to
the
“Compliance Unit
Evaluation” form in
PCB 94-
243
and to the comments ofthe Agency’s field operations section (FOS).
(Id.)
The FOS
noted:
FOS Peoria offers the following comments:
Watts landfill has failed
to submit
their significant modification as outlined
in Supplemental Permit No. 2993-267-
SP.
Also, the owner
is
in apparent non-compliance
with Section 39(i) of the
Act.
Based on these facts, the application should be denied.
(R.
94-243 at 60-
69.)
The Agency contends that the real focus of the Board is not what the permit reviewer
“may or may nothave
known or considered”
but rather the stated basis for denial of the
permit.
(Ag.
Br.
at 29-30.)
The denial letters do not include,
as a
stated denial
reason,
failure
to timely file the application for significant permit modification.
(R.
94-243 at 3; R.94-306 at
61-62;
R.
94-307 at 62;
R.94-308 at 62;
R.
94-309 at 62;
R.
95-133 at 60-61;
R.
95-134 at
60-61.)
The testimony at hearing of the permit reviewer and Mr. Bakowski also indicate that
the failure to
timely file the application for significant permit modification was not
relied upon
for the denial of the permits.
(Tr.
at 87 and 98-99.)
While the Agency
admits that the
comments from the FOS did refer to the failure to timely file the application for significant
permit modification, the Agency
contends that
the mere fact that the permit reviewer had
knowledge ofthe alleged violation does not mean the denial was based on the alleged
15
violation.
(Ag.
Br.
at 27
and 29.)
Anything a reviewer learns may subjectively enter into the
reviewer’s thought processes and this potential
subjectivity according to the Agency
is why the
Agency is
required to list the specific denial reasons in writing and then “stand behind” the
actual selected denial
reasons.
(Id.)
Finally,
Watts argues that the Agency’s reliance on the Sangamon Valley Landfill
adjudication was prematurebecause the matterwas
on appeal and Watts would have been
prejudiced had the matter been
reversed.
In response, the Agency argues that the
decision in
Sangamon County
was clearly a final decision and
there
is
no statutory
requirement that all
possible avenues
of appeal be exhausted before the Agency can rely on an adjudicated
violationunder
Section 39(i).
(Ag. Br, at 24.) The Agency states that due process
considerations were satisfied by the bench trial
on the violations.
(Id.)
Agency’sLack of Procedures
Watts argues that the use of Section 39(i) of the Act is
a
“drastic measure designed to
prevent
‘bad actors’ from engaging in the waste disposal industry”
and only
significant
violations should beconsidered in applying Section 39(i) as a denial reason.
(Pet. Br. at 8-9.)
Watts believes that the Agency
is
“advocating complete, total,
and unreviewable discretion to
deny permits under Section 39(i)”
of the Act.
(Pet.
Rep.
at
19.)
Watts maintains that the
Agency’s denial of these permits
based on Section 39(i) of the Act is
improper because it is a
discretionary process not conducted on all permit applications and without any written or
unwritten policy,
guidelines,
or procedures relating to
Section 39(i).
(Pet.
Exh.
13 par 10;
Pet.
Br.
at 23.)
Therefore Watts claims the Agency is not fulfilling Section 39(i).
(Pet.
Br.
at
15
and 23;
Pet.
Exh.
13, par.
11.)
In response,
the Agency
asserts that there
is no evidence in the record to
support the
conclusion that its lack of written procedures specific
to Section 39(i) prevents it from
evaluating a prospective operator’s prior experience or that the evaluation was not done
in this
case,
(See
Ag.
Br.
at 36.)
The Agency contends that the existing permit
procedures are
sufficient to ensure that
a relevant evaluation is
conducted prior to permit
issuance.
(Id.)
The
Agency
asserts that Watts is attempting to add
“restrictions
and conditions”
to
the Agency’s
discretionary right to deny
a permit pursuant to
Section 39(i) of the Act,
contradicting the
intent of the legislation beyond any judicially imposed requirements of
due process.
(Ag.
Br.
at 13.)
ANALYSIS
The legislature has placed an affirmative responsibility on the Agency to perform an
evaluation ofanyprospective landfill operatorwho submits a waste managementpermit
application to ascertain whether that
operator has a history of repeated violations,
convictions,
or is otherwise responsible for gross carelessness or incompetence
relating to the management
of waste.
Relying on the results of the evaluation, the Agencymay accordingly deny the
permit application if the prospective operator’s historical information reveals any of the types
16
information delineated in Section
39(i)(1)-(3).
Notably,
this evaluation is
not necessarily
limited
to information submitted on the permit application, and because the Agency must
“conduct”
the evaluation, the Agency may gather information from either within the Agency
or outside the Agency.
In this case, the petitioner is not disputing that the Agency did in fact conduct an
evaluation as required pursuant to
Section 39(i).
It is
clear from the record that
the permit
reviewer did conduct a review of the permit for technical
sufficiency
and compliance with
Section 39(i).
For the generic waste
stream permit
(PCB 94-243), the reviewer internally
solicited comments
from other sections within the Agency
on both the technical information in
the permit application and on any pending enforcement or other significant issues relating to
the facility or the operator.
(Tr. at 97-102, 129.)
In response, the permit reviewer received
Section 39(i)-responsive comments which he considered regarding the generic permit and
which he determined applied equally to the six special waste stream permits.
He
received
written comments from both the FOS and the Division of Legal
Counsel (DLC).
While
some
of the written comments addressed matters
the permit
reviewer could not use in denying the
permit,
the DLC
and the FOS brought to Brahinamdam’s
attention petitioner’s history of
violations of the Act and the regulations which eventually served as the basis
for the permit
denials.
(Tr.
at 111.)
Accordingly,
in this case, the Agency clearly satisfied
its
duty to
conduct an evaluation of the operator’s prior experience pursuant to Section 39(i).
Here, petitioner challenges the results of that
evaluation, which
show a cumulative
history of a circuit court adjudication based on
12 separate
counts for statutory
and regulatory
violations concerning the Sangamon Valley Landfill and
19
repeated administrative citation
violations relating to Watts’ management of waste disposal operations at three Watts-operated
landfills.
Watts disputes the Agency’s conclusion that these violations demonstrate a history of
repeated violations such that permit denial is warranted.
Watts additionally challenges the
method by which the evaluation was conducted,
disputing whether it was performed fairly and
whether the Agency has a practice of conducting the evaluation consistently on all
solid waste
disposal-related permits.
As there are no
administrative
rules adopted by the Agency
to
govern the Agency’s
processing of solid waste disposal
permit applications or to
govern the mandatory Section 39(i)
evaluation, and since the Agency
has not proposed rules to the Board for adoption, we find it
helpful to
examine other relevant portions of the Act and Board
regulations in
analyzing this
case.
In particular, Section 22.5 of the Act,
which was adopted in the same Public Act (P.A.
81-1484) as Section 39(i), has the same apparent legislative purpose.
These sections were both
adopted to provide the Agency with an opportunity
to review an operator’s prior experience
for repeated violations or other egregious acts in order to control who
is operating waste
disposal
sites in Illinois.
In the case of Section
22.5,
the Board was specifically
directed to
adopt rules governing prior
conduct certification implementing the statutory criteria for
operating personnel certification.
Virtually
identical
to Section 39(i),
Section 22.5 of the Act
provides:
17
The Board
may provide for denial of certification if the prospective operator or
anyemployee or officer of the prospective operator has a history of:
1.
repeated violations of federal, State, or local laws, regulations, standards, or
ordinances in the operationof refuse disposal facilities or sites; or
2.
conviction in this or another State ofany crime which is a felony under the laws
ofthis State or conviction of a felony in a federal court; or
3.
proof of gross carelessness or incompetence in handling, storing, processing,
transporting or disposing ofany hazardous waste.
The Board adopted regulations
implementing Section 22.5 pursuant to the Illinois
Administrative Procedures
Act in
Prior
Conduct Certificationfor Waste Disposal Site
Personnel.’
35111.
Adm.
Code
745,
(September 4,
1987) R81-18,
81
PCB
101.
In addition to
adopting procedures for the processing of prior conduct certifications of such applications by
the Agency, the Board also set specific standards for denial ofthese applications and
articulated mitigating factors that the Agency may rely upon to determine whether to grant
certification. Although the regulations at 35 Ill. Adm. Code 745 do not apply specifically to
Section 39(i) decisions, we find the regulations provide helpful guidance to our decision.
In
pertinent part, Section745.141 (a)(1) provides that the Agency shall deny prior conduct
certification to any person who has been repeatedly found, after opportunity for an adversarial
proceeding before any judicial or administrativebody, to be in violationofany federal, State
or local laws, regulations or ordinances governing the operation ofwaste disposal sites in any
state. As for factors in mitigation, Section 745.141(b) provides:
The Agency may, in its discretion, grant prior conduct certification if mitigating
factors exist such that certification should issue. Mitigating factors include:
1.
The severity of the misconduct;
2.
How recently the misconduct took place; and
3.
The degree of control exerted over waste disposal
operations at a site by the applicant at the time misconduct
described in subsection (a)(3) was committed.
The Sangamon Valley Landfill Adjudication
In denying the permit,
the Agency
concluded that the circuit court’s
Sangamon Valley
Landfill decision coupled with the
19 administrative citations was sufficient reason to justify
denying the seven permits pursuant to Section 39(i). The Agency’s Bureau ofLand Permit
Section Manager, Mr. Bakowski,
indicated at hearing that
the Sangamon Valley Landfill
litigation was a major factor in the Agency’s decision. He further testified thatthe Agency not
only considered that
the court had found this
Watts-operated landfill in violation,
but that the
State had to expend considerable effort to bring about compliance at the site. Bakowski
testified that the Agency specifically considered:
18
the seriousness of the violations and the efforts by the applicant beforeand
after the case
-
ofhow reasonable his efforts were before, how reasonable his
efforts wereafterwards, and then the reasonableness ofwhat level the Agency
had to go through to promote that sort of compliance or efforts to comply.
(Tr.
at 74.)
Our reading of the order shows that while the court found Watts had taken some steps
to abate the violations at the site, the court determined
it
was
still necessary to assess a
$350,000penalty ($250,000 to the State of Illinois and$100,000 to SangamonCounty) to
bring Watts in compliance with the Act and regulations.
Additionally, the court mandated a
series of eight specific actions that Watts was to perform to immediately bring about “strict
compliance with Agency permits.” These actions included repairing the clay liner,
constructing berms, addressing noise control problems, implementing a groundwater
remediation
program,
excavating and
disposing ofrefuse
from the unpermitted portions of the
landfill and initiating closure for certain areas of the landfill, implementing a surface water
control system, and finallyremoving debris from neighboring properties.
In the event that
Watts could not bring the landfill into compliance as directed in the order by May 31, 1994,
Watts was to advise the
court as to its
status and present
justification for noncompliance.
Additionally, the Agency was directed in the order to keep the court informed as to Watts’
progress,
We believe the seriousness of the violations that occurred at the Sangamon Valley
Landfill, together with the 19 adjudicated administrative citations against Watts, are sufficient
cause to justify the Agency’s denials in this case.
It was appropriate for the Agency to factor
in the repeated violations present at Sangamon Valley Landfill in order to make a
determination on the propriety of Watts’ continuance as an operator at other landfills in the
State.
None
of the mitigating factors raised by Watts, nor any of the mitigating factors
delineated in Section 745.141(b), persuade us to question the Agency’s reliance onSangamon
Valley Landfill litigation to deny the permits.
The violations are severe, very recent and,
significantly, Watts exerted control as the operator over the Sangamon Valley Landfill.
It is
uncontested that Watts was primarily responsible for making the
management decisions which
brought about theproblems at the Sangamon Valley Landfill. We find it relevant that in order
to provide Watts with an “incentive” to come into compliance at the site, the court found
it
necessary to assess a $350,000 penalty. Under the facts of the Sangamon Valley Landfill
circuit
court case,
there is nothing inappropriate about the Agency considering that
litigation,
particularly
in light of the Agency’s difficulty in bringing about compliance with the Act and
regulations.
It is
noteworthy that Watts does not raise
any
argument that the types of violations that
occurred at the Sangamon Valley landfill are not severe.
Watts does not argue that the
violations were not
within the control of Watts as the operator.
Instead,
the petitioner argues
that there are different personnel at the Sangamon Valley Landfill than the Taylor Ridge
Landfill,
and that it
is improper for the Agency to consider historical information stemming
from
any
landfill other than the one at issue in the permit applications pending before the
Agency.
We do not find either of the petitioner’s arguments meritorious.
Section 39(i)(1)
19
clearly contemplates that the Agency mayneed to look outside of the current facility for
information relating to the operator’s prior experience at other disposal sites and it was proper
in this case to do so.
Section 39(i)(1) is clearly operator-specific and not facility-specific.
The 19 Administrative Citation Adjudications
The Agency additionally denied the seven permits based on Watts’ having been found
in violation of the administrative citation provisions of the Act in 19 separate cases adjudicated
by the Board from 1987 to 1994. TheAgency witnesses testified that the Agency considered
the citations as adjudicated violations, and additionally considered both the “quantity and
severity” of the citations. Bakowski stated at hearing that no single citation was given special
consideration or particular weight, rather it was the cumulative effect of the many adjudicated
citations which was relevant to the Agency’s consideration.
(See
Tr.
at
62-65.)
While
no
single administrative citation, nor any handful, is sufficient to warrant denying a
RCRA
or
solid waste management-related permit based on Section 39(i), we believe the Agency’s
consideration ofthe citations
“in the aggregate” coupled with the factually-egregious
Sangamon Valley Landfill adjudication, together,
is
sufficient to
invoke Section 39(i).
We disagree withWatts that the citations are too minor in this case to be considered by
the Agency. While the administrative citation process is designed to be a simpler mechanism
for achieving enforcement and it avoids the lengthy and complex litigation which may
accompany a
traditional enforcement action,
administrative
citation violations can range from
litter control problems to more serious concerns such as with leachate flow. The Agency is
specifically charged in Section 39(i) with evaluating the operator’s prior experience in
managing these waste disposal facilities
and the administrative
citations are
telling in that they
give the Agency a picture of Watt’s operational control over the three landfills managed
by
Watts.
In this case, the seven years of administrative citations show a
history of nine
violations for refuse
in standing or flowing
waters;
two violations for leachate
flow entering
the waters of the State;
two violations for leachate
flow exiting
the landfill confines;
20
violations
for uncovered refuse
remaining from any previous
operating day or at the
conclusion of any
operating day; two
violations for failure
to submit reports required by
permits or Board
regulations and eight violations for failure
to collect and
contain litter from
the site by the end of each operating day.
Watts argues
that,
because the citation process is
designed to be a
simpler mechanism
for enforcement, it is,
therefore,
inappropriate to consider administrative citations in relation
to waste
management operating permits.
We, however,
find this
argument without merit.
In
the case of the Sangamon Valley Landfill litigation and
as part of assessing the $350,000 in
penalties, the court found Watts in
violation of several of the same statutory provisions of the
Act (Sections 21(o)(1)-(3),
(5)
(9), (11) and (12)) which were also
at issue
in the administrative
citation cases before the Board.
Clearly the court found these violations significant enough to
serve as a factor in assessing a $350,000 penalty; therefore,
we are hard pressed to conclude
that the same violations are unimportant merely because they were prosecuted via the
administrative
citation route.
Additionally, it is particularly relevant that the court ordered
20
Watts to pay $3,000 in administrative citation penalties which Watts had failed to pay and
which were assessed in the citation cases before the Board.
(See
Sangamon Cty Cir. Ct. Order
of February 2,
1994,
R.
94-243 at
130.)
Watts also raises as a “mitigating” factor the fact that the administrative citations are
not recent enough to be relevant to any consideration of the Watts’ operational and
management history.
While we are not persuaded that the “staleness” ofthe citations is
enough to warrant a reversal of the Agency’s decision, we do believe that ordinarily, the age
of the violations
may be an important consideration.
It is
the responsibility of the Agency to
ensure that when it is decided an operator’s history of repeated violations warrants terminating
operating rights via the permit denial, that the basis for the decision bears a rational
relationship to the Agency’s concerns.
It is not reasonable to deny an operator either prior
conduct certification (“age of the violation”
is listed as a mitigating factor in Section
745. 141(b)(2)) or a wastemanagement permit based on ancient history without there being
additional reasoning for the decision.
In this case, when we examine the historical record of
Watts’ landfill operations across the State, we find a record replete with operational violations
and noncompliance.
Notably, the mostrecent adjudicated violations occurred in the
administrative citation cases inMay of 1994 (three months prior to the Agency’s first permit
denial) and in the Sangamon Valley Landfill litigation, in February of 1994 (six months prior
to the Agency’s permit denials).
Therefore, there is nothing inappropriate about the 19
administrative citations, in the “aggregate,” togetherwith the Sangamon Valley Landfill
litigation, serving as the basis for the Agency’s decision to deny the seven permits pursuant to
Section
39(i).
Other Considerations
The
Wells Letters
Watts argues that the Agency’s use of the
Wells
letters is
evidence that the Agency did
not give appropriate consideration to Watts’ operational history when it made the decision to
deny the permits.
Watts believes the
Wells
letters merely show that the Agency had already
determined the permits would be denied, and that
the
Agency provided no “real opportunity”
for Watts to respond to the letters. The Board finds that the Agency appropriately used the
Wells letter in these seven permit applications.
In the
Wells
case, the
court held that the
Agency should allow an applicant the opportunity to respond to allegations that the issuance of
the permit may violate the Act or Board regulations.
It is undisputed that
Wells
letters were
sent to Watts citing various adjudicated violations as potential rationale for denial of the
permits.
It is further undisputed that Watts replied to those letters. The dispute arises over
how the
Agency
evaluated the Watts’ reply to the Wells letters. The Agency
permit reviewer
testified that he reviewed
theresponse received from Watts and discussed the response with
others
at the Agency.
Therefore, the record establishes that the Agency considered the
responses to the Wells letters.
21
Unadjudicated Violations
Watts also alleges that the Agency improperly relied on
unadjudicated violations when
deciding to deny the permits.
The Board finds that the record does not support Watts’
allegation. The FOS did, in fact, recommend to the permit reviewer that the permit be denied
because Watts had failed to submit a timely application for significant permit modification.
However,
the FOS
is not responsible for making a recommendation
on whether to
grant or
deny the permits.
The permit reviewer may have
“considered” the fact that
the application for
significant permit modification had
not been filed; however,
the permit reviewer testified that
he
“considered” several matters
in recommending denial.
The Agency’s denial letters
articulate the specific
reasons for denial which included
Watt’s past
history and certain
technical
deficiencies.
The denial letter does not state among the list of violations the failure
to timely
file the significant modification permit.
It is
well settled
that the Agency denial letter
frames the issues in a permit
appeal.
(Pulitzer Community
Newspapers, Inc.
v IEPA,
PCB 90-
142,
at
6
(December 20,
1990);
Centralia Environmental Services,
Inc.
v.
IEPA,
PCB 89-170,
at 6
(May
10,
1990);
City of Metropolis v IEPA,
PCB 90-8 (February 22,
1990).)
Additionally, Watts argues
that it
is
somehow unfair that
the Agency considered the
Sangamon Valley Landfill litigation when the case was clearly on appeal during the pendancy
of the permit applications before the Agency.
The Board
disagrees with the petitioner’s
argument
in this
regard.
For purposes of the Section 39(i) and
in satisfaction of
Martell,
all
that is necessary
is
that an
adversarial hearing be
held where the permit applicant had an
opportunity to
contest the alleged violations and
that the violations
be adjudicated as a result of
that hearing.
This requirement has become
the
“adjudicated violations” requirement in
Martell.
In this case, Watts received a hearing before the Sangamon County
circuit court and
received
added due process protection in a hearing before the Board concerning
the Agency’s
permit denials.
Perhaps if the circuit court’s order been reversed
by
the appellate court, then
we may have a different
case at bar on the issue
of the severity of the Sangamon Valley
Landfill violations;
however,
the circuit court was affirmed on
all counts
including the
$350,000 penalty.
(People and County o,f Sangamon
v.
Watts
Trucking Service,
Inc.
and ESG
Watts,
Inc.
(July
14,
1995) No.
4-94-0414 (Rule 23
Order).)
Agency’s Lack of Procedures
We agree with Watts that
the
Agency’spractices might lead to an inconsistent application
of Section 39(i). There areno adopted
rules
for routinely conducting 39(i) evaluations in the
context ofthe Agency’s permit review process. Equally obvious is the fact that seeking
and
offering “past history” comment in the context oftheAgency’s
permit
review process involves a
discretionarycase-by-casejudgment on the
part ofAgency personnel.
We
note that the lack of
consistent 39(i)procedures is amost troublesome aspect for the Board in itsreviewofthis case
and, indeed, is largely responsible fora division within theBoard as to the outcome.
Nonetheless, we do
not believe that the method
by which the Agency conducted the evaluation of
Watts’
prior violations rises to a level which warrants reversal under the facts ofthis particular
case.
22
Rather, we are persuaded that the history ofpast violations contained in
this record so
clearly demonstrates an example ofan appropriate use of Section 39(i), that Watts’ argument
concerning unfair treatment begsthe real issues concerning the extentand contextofits past
violations.
The Agency’s decision in this case is, quite simply, supported by a clear record of
severe andrepeated violations ofthe Act
and
regulationson the
part of Watts.
In a less obvious
case, theAgency’s Section 39(i) denial might have
warranted reversal had the Agency employed
the same procedures used in this case.
While we agree that
it would behoove the Agency, if it
expects to prevail upon review ofa Section
3 9(i) decision in the
future before this Board, to
develop amore consistent process andmore specific standards to evaluate permittees for prior
history of violations (such as the Section 745.141
factors that we relied upon)
we cannot agree
that
the procedures utilized in this
case call for a reversal ofthe Agency’s decision.
COSTS
In an order of February
15,
1996,
the Board accepted the Agency’s late-filed brief and
imposed sanctions against the Agency for the late-filing.
The Board imposed the reasonable
costs of Watts’ attorney in preparing the motions and responding to the late-filed brief. The
Board directed Watts to file such costs with the reply brief. On February 23, 1996, the Board
received an affidavit ofcosts fromWatts.
Watts asks for $125 per hour for ten hours totaling
$1,250 for costs. The cost of$125 is reasonable here and the Board directs the Agency to pay
to Watts the sum of $1,250.
CONCLUSION
In denying a permit pursuant to Section 39(i) of the Act, the Agency is to evaluate the
operator’s history
and
determine if there
are repeated violations which warrant the denial of a
permit.
In this case, the Agency properly considered 19 administrative citations and a circuit
court case in finding that the operator has a history of repeated violations.
Therefore, the
Board affirms the Agency’s denial of these seven permits.
The Agency also listed several technical denial point on six of the seven permit
applications. The Board finds that the six applications which weredenied for technical denial
reasons were sufficient to establish that no violations of the Act or Board regulations would
occur if the permits were issued.
This opinion constitutes theBoard’s findings of fact and conclusions of law in this
matter.
ORDER
1)
TheBoard finds that the Illinois Environmental Protection Agency properly
denied ESG Watts the seven
permits in
the following cases:
PCB 94-243
PCB 94-307
23
PCB 94-306
PCB 94-308
PCB 94-309
PCB 95-133
PCB 95-134
2)
All dockets are closed.
3)
The Illinois
Environmental Protection
Agency is
hereby ordered to pay
the sum
of $1,250 as sanctions for the late filing of its brief to the Charles J. Northrup,
attorney of record forESG Watts within60 days of the date of this order.
IT IS
SO
ORDERED.
J.T.Meyer, G.T.Girard and E.Dunham dissented.
Section 41 of the Environmental Protection Act (415 ILCS 5/41 (1994)) provides for
the
appeal of final Board orders within 35 days ofthe date of service of this order. The Rules
of the Supreme Court of Illinois establish filing requirements.
(See
also 35
Ill. Adm. Code
101.246 “Motions for Reconsideration.”)
I, Dorothy M. Gunn, Clerk of the Illinois Pollution Control Board, hereby certify that
the above opinion and order was adopted on the~?/-~”~
day of
146-’~_.~J~”
,
1996,
by a
vote
of
~
,~
/
~
~.
/~
,
Clerk
)fl
Control Board
Illinois
Pollui