BEFORE THE
POLLUTION CONTROL BOARD
OF THE STATE OF ILLINOIS
ILLINOIS AYERS OIL COMPANY,
)
Petitioner,
V.
ILLINOIS ENVIRONMENTAL
PROTECTION AGENCY,
Respondent.
)
NOTICE
)
)
)
)
PCB No. 03-214
(LUST Appeal)
RECEIVED
CLERK’S OFFICE
MAY
21
2004
STATE OF ILLINOIS
Pollution Control Board
Dorothy M. Gunn, Clerk
Illinois Pollution Control Board
James R. Thompson Center
100
West Randolph Street
Suite
11-500
Chicago, IL 60601
Carol Sudman, Hearing Officer
flhinois Pollution Control Board
1021 North Grand Avenue East
P.O. Box
19274
Springfield,
IL
62794-9274
Fred C. Prillaman
Mohan, Alewelt, Prillaman & Adami
Suite
325
1 North Old Capitol Plaza
Springfield,
IL
62701-1323
PLEASE
TAKE
NOTICE that
I have
today
filed with
the
office of the
Clerk of the Pollution
Control
Board
a
RESPONSE
TO
MOTION
FOR
AUTHORIZATION
OF
PAYMENT
OF
AUOR~EYS’FEES
AS
COSTS
OF
CORRECTiVE ACTION,
copies of which
are
herewith
served
upon you.
Respectfully submitted,
ILLINOIS
ENVIRONMENTAL
PROTECTION AGENCY,
Assistant Counsel
Special Assi~tant
Attorney General
Division ofLegal Counsel
1021 North Grand Avenue, East
P.O. Box
19276
Springfield,
illinois 62794-9276
217/782-5544
217/782-9143 (TDQ)
Dated: May
19, 2004
RECEiVED
CLERK’S OFFICE
BEFORE THE POLLUTION CONTROL
BOARD
OF THE STATE
OF ILLINOIS
STATE OF ILLINOIS
ILLINOIS AYERS OIL COMPANY,
)
Pollution Control
Board
Petitioner,
)
v.
)
PCB No. 03-214
ILLINOIS ENVIRONMENTAL
)
(LUST Appeal)
PROTECTION AGENCY,
)
Respondent.
)
RESPONSE
TO
MOTION FOR AUTHORIZATION OF PAYMENT
OF
ATTORNEYS’ FEES AS
COSTS OF
CORRECTIVE
ACTION
NOW COMES
the Respondent, the Illinois
Environmental Protection
Agency (“Illinois
EPA”), by one of its
attorneys, John J. Kim,
Assistant
Counsel and
Special
Assistant
Attorney
General, and,
pursuant to
35
Iii.
Adm.
Code
101.500, hereby requests that the
Illinois
Pollution
Control
Board
(“Board”)
deny
the
Petitioner’s
Motion
For
Authorization
Of
Payment
Of
Attorneys’
Fees
As
Costs
Of
Corrective
Action
(“Petitioner’s
motion”).
In
support
of this
response, the Illinois EPA states as follows:
I.
On April
1,
2004,
the
Board
issued
an
opinion
and’ order
in
this
matter.
The
Board’s
opinion included
an
order
that
the
Illinois
EPA
restore
certain
modifications
to
the
Petitioner’s high priority corrective action plan (“HCAP”) and
budget by approving the HCAP’s
proposed use of 13 direct push soil borings and by restoring all corresponding budget reductions.
2.
The opinion also included an
affirmation of certain budget reductions imposed by
the Illinois EPA in the final decision under appeal.
3.
Following the issuance of the Board’s opinion, the Petitioner, Illinois Ayers
Oil
Company, filed the Petitioner’s motion
seeking the Board’s authorization of payment
from
the
Underground Storage Tank Fund (“UST Fund”) in the amount of
$44,456.49
in legal
fees.
The
Illinois
EPA
received
service of the
Petitioner’s
motion
on
May
3,
2004.
The Illinois
EPA
subsequently filed a motion for an
extension oftime by which to
file this response.
1
4.
The Petitioner cites to
Section 57.8(I) ofthe Illinois Environmental Protection Act
(“Act”) (415 ILCS
5/57.8(1))
as the authority for the Board to
allow payment oflegal
fees to
an
owner/operator
who
has
prevailed
in
an
appeal.
Specifically,
that
subsection
provides
as
follows:
Corrective
action
does
not
include
legal
defense
costs.
Legal
defense
costs
include
legal
costs
for
seeking payment
under
this
Title
unless
the
owner
or
operator
prevails
before
the
Board
in
which
case
the
Board
may
authorize
payment of legal fees.
(Emphasis added.)
Thus, there is a clear statutory provision allowing
for the possible—not mandatory—approval of
legal costs when such costs
are related to
a successful action to
seek payment under Title XVI of
the Act (415 ILCS
5/1,et~q.).
5.
The
Petitioner
argues
that
this
language,
as
a
fee-shifting
provision,
should
ordinarily allow for the recovery of legal
costs
unless
special
circumstances otherwise warrant.
Further,
the Petitioner notes
that
fee-shifting
statutes
are intended
to
encourage
litigation,
and
that the Board has recognized that adjudication of contested cases
is
an essential element of the
formation
of policies
which
make up
the
underground
storage tank
reimbursement program.
Petitioner’s motion, pp. 2-3.
6.
The Petitioner goes on to claim
that
fee awards pursuant to
Section 57.8(1) ofthe
Act help
protect
the interests of third-parties.
This
is
explained by
arguing that
to
not
award
legal
costs,
an owner or operator might yield to
a reduced corrective action
plan.
In the event
that the
plan is
subsequently found
to
be
insufficient,
the
owner or operator can point
to
the
Illinois
EPA’s
approval
as
a
defense
to
a
possible
third-party
claim.
Awarding legal
costs
encourages
an
appeal
to
the Board
where
complacency
would
be
less
costly than
litigation.
Thus,
by
the
Petitioner’s
rationale,
seeking
the
restoration
of
costs
deemed
necessary
to
determine the extent of contamination provides
both the Petitioner and a third-party such as an
2
adjoining
landowner benefits since those
parties are spared
the
risk of the Illinois
EPA’s cost-
cutting.
Petitioner’s motion, p.
3.
7.
Finally,
the
Petitioner
argues
that
the
Board’s
ruling
on
the
“rate
sheet”
previously utilized by the Illinois
EPA was similar in nature to
the type of action that, pursuant
to
the Administrative
Procedure Act
(“APA”),
would
be
eligible
for recovery of legal
costs.
Petitioner’s motion, pp.
3-4.
8.
Included
with
the
Petitioner’s
motion
is
an
affidavit
provided
by
Petitioner’s
counsel and documentation regarding the amounts offees and costs that make up the Petitioner’s
total request for payment.
9.
The Board should issue a decision denying the Petitioner’s
motion for any
one of
several reasons.
The most
obvious
and
well-reasoned basis
for
denying the claim
is
that
the
present action
is
not
the type addressed by
Section
57.8(1) of the
Act.
That subsection clearly
provides
that
legal
costs
may possibly be
recovered
only
following a
successful
action
to seek
paymentfrom
the
UST Fund
pursuant
to
the
Act.
That type
of action,
one
seeking payment
under Title XVI ofthe Act, is the only type that is provided for in Section
57.8(1).
10.
The present action was not one related to
the Petitioner seeking payment from the
UST Fund.
The decisions under appeal were illinois EPA modifications to a HCAP and budget
submitted
by
the
Petitioner.
In
neither
the
HCAP
nor the
budget
does
the
Petitioner
seek
payment from theUST Fund.
Only a request for payment ofreimbursement seeks payment from
the UST Fund, and
that
clearly was not the type ofsubmission made by the Petitioner that led to
this appeal.
11.
The Petitioner may argue that approval of the HCAP
and budget were necessary
precursors for later submitting an actual request seeking payment from the UST Fund.
That fact
3
notwithstanding, the Petitioner cannot perform
an
end-run around the requirement of a specific
type of legal action set
forth
in Section
5 7.8(1).
Indeed, if any condition precedent
to
an actual
request for payment
from the UST Fund is
considered
to be
tantamount to
a request itself,
then
contrary to
the statutory
language of Section
57.8(1), the Board will be broadening the
scope of
the provision’s
plain
language
to
mean that
any
type of final decision (whether for a technical
plan or budget) is
the same as a request for payment.
12.
It
is
impossible to
argue that
a technical
plan
is
akin
to
a
request for payment,
since a
technical
plan does not
include
any
request
for payment.
Further,
the Board’s
own
regulations
unequivocally
show
that
technical
plans
(including
HCAPs
and
budgets)
and
requests for payment are two
different types ofsubmissions.
13.
Subpart E of Section 732 ofthe Board’s regulations
(35
111.
Adm. Code
732.500-
505)
addresses the selection and review procedures for plans and reports.
Section 732.500(b,
c)
set
forth
the different
types of documents that are defined as plans
and
reports.
Among
those
documents
are high priority
corrective
action
plans
and
associated
budgets.
Section
732.505
describes the standards for review ofplans and reports, including HCAPs and budgets.
14.
Subpart F of Section 732 of the Board’s regulations (35 Ill.
Adm.
Code
732.600-
612)
addresses payment or
reimbursement from
the
UST Fund.
That subpart
has
separately
defined review procedures.
15.
There is no doubt that a request for payment
from the UST Fund is not the
same
document
aá
a
plan
or
report (including
a
budget).
The
Act
and
the Board’s
regulations
are
straightforward in their separate definitions and procedures related to those two different types of
submissions.
It
is equally without doubt that the Petitioner’s submissions that led to the Illinois
EPA’s final decision that was reviewed by the Board in the present appeal were not requests for
4
payment,
but rather were
a
corrective
action
plan
and
associated
budget.
If the
language of
Section
5
7.8(1) of the Act
included actions involving plans or reports, the Petitioner’s
claim for
legal costs
may have some merit.
But the specific description of a request
for payment,
to the
exclusion of referencing appeals
of plans
and
reports,
must be
taken into consideration by the
Board
that
the
General
Assembly’s
language
is
not
intended to
be
all-inclusive.
The
action
brought
by
the Petitioner
here
is
simply not of the type that
falls within the
scope
of Section
57.8(1)
ofthe Act.
16.
In the only other case that the Board has relied upon Section
57.8(1)
ofthe Act to
award legal costs, the final decision under review was one issued by the Illinois EPA in response
to
a request for payment
from the UST Fund.
~,
Ted Harrison Oil
Company v.
Illinois EPA,
PCB 99-127.
In Ted Harrison, the Illinois EPA denied reimbursement sought by Ted Harrison
Oil
Company.
Following
the
Board’s
ruling
that
the
Illinois
EPA’s
decision
should
be
overturned, the Board went
on to
award
legal
costs.
Ted Harrison, PCB 99-127 (October
16,
2003).
The Ted Harrison case did involve
an action of the type specified in Section 57.8(1), and
the Board’s reliance on Section
57.8(1) was
thus
warranted.
Here,
since the final decision was
not
one
denying reimbursement
from
the UST Fund,
the
Petitioner cannot
avail itself of the
provisions in Section
57.8(1).
17.
If the Board were
to
somehow find that the clear restrictive language of Section
57.8(1) ofthe Act
should be interpreted beyond its plain meaning (as the Petitioner would have
the Board de), the Board
should nonetheless deny the Petitioner’s motion.
Assuming
arguendo
that a budget could somehow be
likened to
a request for reimbursement, there is no
doubt that a
technical
plan
such as
a
HCAP
is
not
a
request for reimbursement.
Indeed,
submission of a
5
HCAP
does
not
bind
or
require
the
owner/operator
to
subsequently
submit
a
request
for
payment.
18.
Thus,
if
an
owner/operator
were
to
prevail
on
an
appeal
involving
a
proposed
corrective action plan, that decision should in
no way be considered to be
sufficient to
invoke the
provisions of Section
5
7.8(1) ofthe
Act.
In the present case, much of the costs
reduced by the
Illinois
EPA in
its
budget decision stemmed
from
the technical
decision in the HCAP
that
the
number of borings
proposed by
the Petitioner was excessive.
That decision
was made
in
the
modification of the
HCAP,
and
the budget
was modified
accordingly.
However, without
the
change
in
the
HCAP,
there
would
have
been no
corresponding
modification
of the budget.
Therefore,
none of the
legal
costs
associated with
contesting
the
Illinois
EPA’s
decision
to
reduce the number ofborings,
and the other related activities, should be considered to be subject
to approval by the Board.
19.
Although
the
Petitioner
argues
that
the
Board
should
not
“claim
chop”
in
awarding
legal
costs,
the
Illinois
EPA
argues
to
the
contrary.
First,
the
Board
should
not
approve any legal costs
here since the action was not ofthe nature described in Section
5
7.8(1) of
the
Act.
However,
if for some
reason
the
Board
does
extend
itself and
find
that
legal
costs
should be awarded, then at the very least the amount oflegal costs
should be reduced.
20.
The Petitioner claims
it cannot separate
its
costs
between the different issues in
the case.
Based
on the
manner in which the legal costs have been documented by the Petitioner,
it
is impos~ib1efor the illinois EPA to
provide the Board with
a
specific
breakdown of legal
costs
on
an
issue-by-issue
basis.
However,
a
review
of the testimony
and
costs
in
the final
decision indicate that the
costs associate
with the reduction
in
the number of borings
(i.e., the
6
technical
issue) accounted for most of the reduction in costs in the budget.
The costs associated
with the Illinois EPA’s reliance upon the rate sheet are minimal in comparison.
21.
If the Board
should
decide
that
legal
costs
are appropriate for payment,
and
the
Illinois EPA strongly believes it should not,
then the Board should at the very least apportion the
Petitioner’s presented legal
costs
by at no less than three-fourths ofthe total amount.
Even that
ratio would be generous,
considering that any costs
associated with the Illinois
EPA’s use ofthe
rate sheet
(the
only
remotely arguable
issue that
was
not
technical
in
nature)
make up
but
a
fraction ofthe total costs ordered restored by the Board.
22.
Another
of
the
Petitioner’s
arguments
is
that
for
the
Board
to
exercise
its
discretion
and
allow
for payment
of legal
costs
in
this
or any
other
matter
is
that
it
would
somehow
help
to
benefit
both
the owner/operator
and
third-parties.
In
the same vein
as
the
Petitioner’s
arguments
that
litigation of matters
should
be
encouraged
before
the Board,
the
failure ofan owner/operator to file an appeal ofa final decision is
a wrong that should be
righted
by
virtually guaranteeing
that
the
costs
associated with
such an
appeal
will
be
paid
for.
The
Illinois EPA does not believe that litigation ofmatters is in any one party’s best interests, but that
sometimes
litigation
is
the
only means
available
for parties
to
resolve differences.
However,
such
an
act
should not
be
encouraged,
but
rather,
as has been noted by
the Board,
resolution
through negotiations allowed by 90-day extensions is
the more preferred route.
The Petitioner’s
arguments
pay no
heed to
such an
option.
Also, it
is
questionable
at best
for
the Board
to
consider deciding the question of whether to award legal
costs
by taking into consideration the
dubious claim that third-parties will benefit in an indirect manner.
23.
Theelast argument
advanced by the Petitioner is that the Board’s decision to
find
that
the rate sheet
was
an
improper rulemaking allows
for recovery of all
related
legal
costs,
7
since pursuant
to the APA,
such a prevailing decision would
allow for the possible
awarding of
legal
costs.
However,
the obvious
flaw
in
that
argument
is
that
the
Board’s authority here
to
approve
legal costs for payment is
not the same as that that
is
conferred via the APA.
Here,
the
Board’s authority
and
scope is
defined in
Section
57.8(1),
and
as stated above, if the decision at
hand is not one in response to
a request to
seek payment from the UST Fund, then the legal
costs
affiliated
with
the appealing the decision are not
subject for approval.
That
a different
statute
allows for the recovery of legal costs for different circumstances by different judicial authorities
does not mean that the Board can avail itself ofthat different provision.
WHEREFORE,
for
the
reasons
stated
above,
the
Illinois
EPA
hereby
respectfully
requests that the Board enter an order denying the Petitioner’s motion.
Respectfully submitted,
ILLINOIS
AGENCY,
Assistant Counsel
Special Assistant Attorney General
Division ofLegal Counsel
1021 North Grand Avenue East
P.O.
Box
19276
Springfield, Illinois 62794-9276
217/782-5544
217/782-9143 (TDD)
Dated: May 19, 2004
This
filing submitted
on
recycled paper.
8
