ILLINOIS POLLUTION CONTROL
BOARD
July
30,
1992
SMITH OIL COMPANY
OF
KANKA.XEE,
Petitioner,
V.
)
PCB 91—243
)
(Underground Storage Tank
ILLINOIS ENVIRONMENTAL
)
Fund Reimbursement
PROTECTION AGENCY,
)
Determination)
Respondent.
CLAYTON L.
LINDSEY APPEARED ON BEHALF OF THE PETITIONER.
DANIEL P. MERRIMAN AND RONALD
L. SCHALLAWITZ APPEARED ON BEHALF
OF RESPONDENT.
OPINION AND ORDER OF THE BOARD
(by G.
T.
Girard):
On December
9,
1991, petitioner,
Smith Oil Company of
Kankakee (Smith Oil)
filed a petition for review of an Illinois
Environmental Protection Agency
(Agency) decision of November
4,
1991,
denying Smith Oil access to the Underground Storage Tank
Reimbursement Fund
(Fund).
The Agency denied the petitioner’s
request for reimbursement because the “owner or operator failed
to demonstrate the tanks were installed in accordance
with OSFM
Office
of State Fire Marshal
regulations”.
(R.
at 98.)’
On February 9,
1992,
a hearing was held in Joliet, Will
County,
Illinois.
On April 16,
1992, petitioner filed
its brief;
on May 20,
1992, respondent filed its brief and on June
3,
1992,
petitioner
filed its reply.
For the reasons
enunciated below,
the Board finds that Smith
Oil is eligible for reimbursement for corrective action costs
from the Underground Storage Tank Fund.
The Agency’s
determination is therefore reversed.
BACKGROUND
Smith Oil
is
a corporation which owns and operates several
convenience stores/gas stations in and around Kankakee County.
l
The record,
also known as “Joint Exhibit
1”, will be
cited to as “R.
at
“;
the transcript will be cited to as “Tr.
at
“;
the petitioner’s brief will be cited as “Pet.
Br.
at
“;
the respondent’s brief will
be cited as
“Res.
Br.
at
“;
petitioner’s exhibits will
be cited as “Pet.
Exh.”; and
respondent’s exhibits will
be cited as
“Res.
Exh.”.
OI35-OI~5
2
(Res.
Br.
at
5.)
Smith Oil began construction of another
facility
in Wilmington,
Illinois at the intersection of Route
53
and West River Road
in 1990.
(Tr.
at
22.)
Smith Oil hired
“D”
Construction to construct the buildings at the site and Penico
Service Company
(Pemco) was hired to install three underground
storage tanks for use in Smith Oil’s facility.
(Tr.
at 24.)
The three tanks arrived at the site and were unloaded on
March 22,
1990.
The tanks were stored on site until the tanks
were installed on April
9 and 10,
1990.
The tanks were strapped
together and chocked with tires for storage.
On April
9, the
tanks were air and soap tested by Mr. Michael Barginann,
maintenance man for Penico.
No defects were noted
(Tr..
at 162—
169).
Excavation of the tank bed was begun on April
9 and
completed on April
10
(Pet.
Exh.
6 and 7).
Bargniann testified that when he arrived at work on April
10,
he observed that the 12,000 gallon tank had been moved 20—30 feet
from the previous day’s position
(Tr.
at
173).
Inquiry
determined that
“D” Construction employees had rolled that tank
by hand
(Tr.
at 174).
Bargniann took “special care to look it
over again” and did not see anything wrong with the tank
(Tr. at
174—175,
205,
arid
228—229).
In addition, Everett Leasure,
a
civil engineer with
“D” Construction testified that he was aware
that the 12,000 gallon tank had been rolled by hand
(Tr. at 254-
255).
He examined all three tanks on April
10, before they were
placed
in the hole, and did not observe any damage to the tanks
(Tr. at 241).
The three tanks were placed in the ground on April
10,
1990.
In addition to the contractors on site,
Mr. Thomas Maher with the
OSFM Division of Fire Prevention was present at various times
during the installation.
However, Mr. Naher was not present
throughout the entire day.
(Tr.
at 131.)
In addition,
Mr.
Maher’s testimony indicates that he did not directly observe
every phase of the tests run on the tanks prior to installation.
Mr. Maher did testify that he did not observe any physical damage
to the tanks and he so indicated on the field inspection
log.
(Tr.
at
149;
R. at 81,
82.)
After installation the tanks were filled with gasoline on
April
10 and April
11.
Stick readings were taken on the 12,000
gallon tank on the evening of April
10 after initial delivery of
product and on the morning of April
11 before more product was
placed
in the tank.
Both stick readings were
69, thus product
did not leak out of the tank overnight.
(Pet.
Br. at
6,
Tr.
at
45-48)
Because
the facility was still under construction, the
piping and pumps were not installed with the tanks and no gas was
pumped
from the tanks.
On April
25,
1990,
a stick reading on
the
12,000 gallon tank
i rid
i c~i
ted
t
hit
there
had
been
a
loss
of
product
Accord
i
ng
to
135-Of
t46
3
Mr. Wayne Kasper,
Vice—President of Smith Oil,
the loss was
estimated at 1200 gallons out of the nearly 12,000 gallons of
product placedin the tank on April
10 and
11.
(Tr.
at 97).
Pemco,
on behalf of Smith Oil,
notified the Emergency Service and
Disaster Agency and hired P&P Consultants,
Inc.
(P&P)
to handle
the clean-up of the site.
P&P recommended that the remaining product in the tank be
removed and the tanks uncovered.
Pemco proceeded to remove the
product and remove the tanks.
Upon removal of the tank,
a crack
was found in the 12,000 gallon tank
(Tr.
at 195 and 272) which
was responsible for the leaking product.
On May 4,
1990,
Mr. Dennis Pingel,
a representative from
Owens Corning, the manufacturer of the tanks, arrived to examine
the tank.
After examining the tank Mr.
Pingel decided to repair
the tank on site.
After repairing the tank,
Mr. Pingel presented
Mr. William Von Drehle,
owner of Pemco a “field agreement” to
sign.
Mr.
Von Drehie signed the agreement which indicated that
the tank had been damaged when installed.
(R. at 51.)
Smith filed
a petition
seeking reimbursement for corrective
action costs associated with the removal of the leaking tank.
The petition was filed with the Agency on December
9,
1991.
On
November 4,
1991,
the Agency denied the claim for reimbursement
because the Agency determined that Smith Oil had not demonstrated
that the tanks had been properly installed.
(R.
at 98.)
DISCUSSION
Before discussing the merits of this case,
the Board will
first address the side issue concerning what version of Section
22.18b(c)
applies
in this case.
The Agency has correctly stated
the Board’s previous holdings on this issue.
The Board will
apply the version of the law which existed at the time the Agency
received the application for reimbursement.
(See First Busey
Trust
& Investment Co.
v.
IEPA,
PCB 91-213
(February 27,
1992.)
Thus,
the Board will apply Section 28.18b(c)
as amended by Public
Act 87—323
effective September
6,
1991.
Section 22.18b(c)
provides,
in part,
that:
no owner or operator
is eligible to receive
money from the. leaking
underground storage
tank) Fund for costs of indemnification or
corrective action for any underground storage
tank installed after July 28,
1989,
unless
the owner or operator demonstrates to the
Agency that the tank was installed and
operated
in
accordance
with
rules
adopted
by
the
Otfjce
of
the
State
Fire
Marshal.
For
0135-Of !~7
4
purpose of this subsection, certification by
the Office of the State Fire Marshal that the
underground storage tanks were installed in
accordance with those rules,
shall be prima
facie evidence that the owner or operator so
installed such underground storage tanks.
(Ill.
Rev.
Stat.
1991,
ch.
111 1/2, par.
l022.18b
(C).)
The Agency relies on two arguments in support of its denial
of eligibility.
The first argument is that the OSFM did not
certify that the tanks were properly installed;
and the second is
that even if the OSFM did certify the installation, the Agency
has sufficiently rebutted the prima facia case and shown that the
tanks were not properly installed.
(Res.
Br. at
4.)
Smith Oil maintains that OSFM did certify that the tanks
were properly installed.
Smith Oil further maintains that even
if the inspection log is not a “certification”, then the
inspection log should be sufficient to create the prima facie
case permitted under Section 22.l8b(c).
(Pet.
Br.
at 3.)
In
addition, Smith Oil points out that a second document entitled
“Notification for Underground Storage Tanks”
(R. at 76-78)
is the
primary document relied upon by the OSFM in determining proper
installation and therefore should be acceptable as certification
by the OSFM.
(Pet. Br.
at
3,
4;
Tr.
at 363.)
The Board must first determine whether or not the OSFM
“certified” that the tanks were properly installed.
Both Mr.
Maher and Ms. Betty Carlisle
(a supervisor in the Division of
Petroleum and Chemical Safety with OSFM)
testified that the OSFM
does not “certify” proper installation of tanks,
in that
a
certificate is not mailed back to the owner or operator by the
OSFM.
(Tr. at 143 and 360.)
However, Mr. Maher did testify:
Q.
Do your regulations provide
--
have a procedure
whereby you provide a certificate or certification
that the installation is done, that all aspects of
the installation was done properly and correctly?
A.
No,
sir.
This is all that goes from the field
inspector to our office as a permanent file and to
my knowledge there is no other paperwork.
The contractor who in this case was Pemco didn’t
even get any paperwork back from us saying that
everything’s okay and, you know, you are going to
get a final certificate of occupancy or whatever
it might be.
We don’t do that.
It’s either done or it’s not done.
O135-OlL~8
5
Q.
Even though the Environmental Protection Act talks
about the Office of the State Fire Marshall
sic)
certification, the Office of the State Fire
Marshall
sic)
doesn’t provide certifications?
A.
No,
sir.
This is public information,
so if
someone was interested in this case,
Pemco, they
could come to our office for me or see me in the
field.
There’s a copy machine.
“Hey,
I’m done
with it, here’s a copy of it.”
Q.
But all this
is, the document, page 81 or 82, the
record,
is a report of your inspection?
A.
That’s all it is.
(Tr. at 143—144.)
In addition Ms. Carlisle testified that:
Q.
With respect to the notification which was on page
78 of the record, and I took it back away from you
again,
but that’s the one where the installer
certifies that they’re a certified installer,
that
the work on the manufacturer’s installation
checklists has been completed and so forth.
Now,
is that the primary certification that the
Fire Marshall
sic)
relies upon in determining
proper installation?
A.
Yes,
it is.
Q.
Because the Fire Marshall
sic
certifies the
installers?
A.
Right.
Q.
And then they certify that they did it right?
A.
That’s true.
(Tr.
at 363.)
Smith Oil argues:
Section 1022.18b(c) specifically contemplates that
the OSFM will perform the necessary inspections of
the installation process.
Respondent readily
admits that the IEPA does not, and did not in this
case, perform an inspection during the
installation process. Tr.
387.
This task has been
specifically assigned to the OSFM.
Tr.
149.
Most
importantly, the Underground storage Tank
0135-0
1149
6
Certification List is the best evidence that the
OSFM has to indicate that the installation was
done properly. Tr.
149.
This document serves as
the OSFM’s verification of proper installation.
Tr.
362.
The Agency’s argument seems to rely on the word
“certification” and what that wccrd means.
The Agency also relies
on the statements made by the witnesses from OSFN that the OSFM
does not “certify” installation.
The OSFM does not send out to
owners and operators a “certificate” stating that the tanks are
properly installed. The OSFN relies on the inspection log and the
certificate filed by the installer to establish that the tanks
are properly installed.
The record clearly indicates that the
OSFM inspector believed the tanks were properly installed.
In
fact, the OSFM inspector filed
a “field inspection log” which
indicated that the tanks had been properly installed.
(R.
at 81;
Tr.
at 117.)
Although Mr. Maher had left the response area for
the question concerning installation pursuant to the
manufacturer’s instructions blank, he testified that omission was
an error on his part.
(Tr.
at 150.)
In addition to the inspection log, Pemco filed with OSFM the
certification of compliance
(R. at 78) which indicated that the
work had been completed pursuant to OSFM’s regulation.
As
previously stated Ms. Carlisle indicated that the certification
of compliance is the primary certification relied upon by OSFM in
determining proper installation.
(Tr. at 363).
Therefore,
the
record clearly shows that the OSFM accepted that the tanks were
installed pursuant to the OSFM regulations on installation.
As
the documents discussed above appear to be sufficient
certification for the OSFM,
the Board will not find that such
documentation is insufficient.
Therefore,
the Board finds that
the OSFM did certify that the tanks were properly installed.
Although the Board is directed by Section 22.l8b(c)
of the
Act to defer to the OSFM in what constitutes certification of
proper installation, that same section gives the Agency authority
to introduce additional evidence in a determination for
reimbursement from the Fund.
Section 22.18b(c)
of the
Environmental Protection Act states that,
“certification by the
Office of State Fire Marshal .~thatthe underground storage tanks
were installed in accordance with-those rules,
shall be prima
facie evidence that the owner or operator so installed such
underground storage tanks”.
In the instant case,
the Board finds
that proper installation of the tanks was certified by the OSFM.
Therefore, we must now address any additional evidence on the
record which would rebut the prima facie evidence of proper
installation established by OSFM certification.
The Agency argues that it has additional evidence that the
12,000 gallon tank was improperly installed and damaged during
0135-0150
7
installation.
The Agency further argues that Section 40(a)1 of
the Act places the burden of proof
on the petitioner to
demonstrate compliance with OSFM rules,
incorporating
manufacturer’s installation instructions (Respondent’s Post—
Hearing Brief at 36).
Regulations specifying that tanks be
installed in accordance with manufacturer’s instructions include
35
Ill. Adm. Code 731.120(d);
41 Ill. Adm. Code 170.50(e),
170.65(c),
170.420(d), and 170.440(e).
The Agency has presented undisputed evidence that the 12,000
gallon tank was rolled about 20-30 feet on the ground
(Tr. at
173—174 and 254-255) which is contrary to the manufacturer’s
installation manual.
(Res.
Exh.
3 at 2.)
However, the
manufacturer’s instructions also require that certain tests be
performed on the tanks prior to the tanks being placed in the
ground.
One of those tests requires covering the entire exterior
of the tank with soap and examining the surface for air bubbles.
• (Res.
Exh.
3 at 2.)
Such a test may require rolling the tank
(Tr.
at 171 and 203—204).
Also,
according to the manufacturer’s
installation manual,
single-wall fiberglass tanks eight feet in
diameter or
less,
“may be manually unloaded from•the truck at
jobsite by the 0/C TANKS trained truck driver.”
(Res.
Exh.
3 at
2).
This means that the tanks are unloaded by rolling them off
the truck,
which occurred at this jobsite.
(Tr.
at 102).
Therefore, the prohibition against rolling tanks does not seem to
be an absolute requirement.
Since the tank in question was only
rolled about one revolution
(the circumference of an eight—foot
tank is about 25 feet), this action alone does not seem
sufficient to override the OSFM certification that the
installation met their rules.
The record does not contain any other clear evidence that
the tanks were not handled according to OSFM regulations.
Other
issues of non—compliance raised by the Agency, such as using
mechanical equipment to move the tanks (Respondent’s Post Hearing
Brief at
33)
or the necessity to anchor the tanks in the hole
because of high water
(Respondent’s Post-Hearing Brief at
28)
were not sufficiently substantiated in the record before the
Board.
The final
issue raised by the Agency is the contention that
the 12,000 gallon tank was damaged during installation.
The
major pieces of evidence are two documents signed by Mr. Von
Drehie,
owner of the tank installer Pemco.
The first was a
“field agreement” signed on May
4,
1990 at the request of
Owens/Corning field representative,
Mr. Pingel,
after the tanks
were repaired.
Notes on the form stated that the tank had been
“damaged during installation”.
(R.
at 51).
However, atthe
hearing,
Mr. Von Drehie testified that Mr.
Pingel told him that
the tank had been damaged by
a backhoe.
(Tr.
at 293).
Von Drehle
stated,
“.
.
.1
just didn’t think that he
Mr.
Pingel)
was right,
but there was nothing
I could do about
it,
he’s the Owens Corning
0135-0 151
man....”
(Tr. at 296).
The second document was an application to remove the
underground storage tank received by the OSFM Division of
Petroleum and Chemical Safety on June 20,
1991.
Mr. Von Drehie
signed Smith Oil Vice-President Kasper’s signature on the
application on behalf of Smith Oil
(Res.
Exh.
1; Tr. at 74-75,
78—79,
87,
93-94).
On the form it stated that the reason for
removal of tanks was that the tank in question “was hit with
backhoe”.
(Res.
Exh.
1).
However,
at the hearing, Mr. Von
Drehle stated that when he signed the document, he was still
relying on the opinion of Owens/Corning field representative Mr.
Pingel.
Mr. Von Drehle expressed doubt about Mr. Pingel’s
opinion
(Tr. at 299-300).
Since Pemco is an interested party,
Mr. Von Drehle’s
conflicting testimony does not provide solid evidence in this
case.
Likewise, Mr. Pingel, as a representative of the tank’s
manufacturer, should not be relied upon for unbiased evidence
that the tank was damaged when installed.
When investigating the
cause of the release, Mr. Carney Miller of P&P reported that Mr.
Pingel was the only person who suggested that the tank had been
damaged by
a backhoe.
(Tr. at 329-330).
Mr. Pingel did not
observe the installation.
Four witnesses to the installation
process
(Bargmann, Kasper, Leasure,
and Maher) testified at the
hearing that the tank was not damaged during installation and was
not contacted by a backhoe.
(Tr. at 39,
116,
149,
164,
179 and
240).
In the absence of other evidence, we cannot disregard the
petitioner’s suggestion “that 0/C Tank’s willingness to point
fingers at the installation process is attributable to a concern
that a defective seam could place responsibility for the release
on 0/C Tanks.”
(Tr.
at 318—319).
The Board hereby reverses the Agency’s determination denying
Smith Oil eligibility to access to the underground storage tank
fund.
Because the Agency made no determination as to the
deductible which will apply to Smith Oil as well as the
reasonableness of the corrective action costs incurred by Smith
Oil, the Board remands this matter to the Agency for such a
determination in accordance with Section 22.18b(d) (4) (C)
of the
Act.
This docket is closed.
Petitioner is free to seek Board
review of the Agency’s final determination of the reasonableness
of costs under a separate docket.,
This constitutes the Board’s finding of fact and conclusions
of law in this matter.
ORDER
The Agency’s determinations that Smith Oil is not eligible
for reimbursement from the Fund is reversed.
This matter is
remanded to the Agency for a determination of the deductible
0135-0
152
9
which will apply to Smith Oil as well as the reasonableness of
the corrective action costs incurred by Smith Oil.
This docket
is closed; however, petitioner is free to seek Board review upon
the Agency’s final determination of the reasonableness of costs.
IT IS SO ORDERED.
Section 41 of the Environmental Protection Act
(Ill.Rev.Stat.
1991,
ch.
111 1/2, par.
1041) provides for the
appeal of final orders of the Board within 35 days.
The Rules of
the Supreme Court of Illinois establish filing requirements.
(But see also
35
Ill. Adm. Code 101.246, Motions for
Reconsideration, and Castenada v.
Illinois Human Rights
Commission
(1989),
132 Ill.2d 304,
547 N.E.2d 437).
I, Dorothy M. Gunn, Clerk of the Illinois Pollution Control
Board, do hereby cert,ify.that the abov
opnion and order was.
adopted on
,jthe
~
day of
-l
,
1992,
by a
vote of
________.
.
OI35-Q~53
Control Board
