ILLINOIS POLLUTION CONTROL BOARD

March

14,

1991

A.K.A. LAND,

INC.,

Petitioner,

PCB 90—177

V.

)

(UST Reimbursement)

ILLINOIS ENVIRONMENTAL

)

PROTECTION AGENCY,

)

Respondent.

DISSENTING OPINION

(by J.D. Dumelle and M. Nardulli):

In today’s case,

the Board was asked to interpret

a statute

which effectively defined the scope of the Illinois tJST

program.

That

is, by virtue of the briefs submitted

in this

case,

an issue presented itself as to who was an “owner” or

“operator”

under

Ill.

Rev.

Stat.

1989 chap. 111—1/2 section

22.l8b.

We disagree with the majority opinion because

it

ignores

basic principles of statutory construction and creates

a legal

fiction which expands the class of “operators”

under

the Illinois

statute.

Because we believe that the

reasoning is flawed and the

that ramifications which might result from defining AKA as an

operator are inconsistent with the Act, we dissent.

FACTS

With the exception of one general characterization,

we agree

with the facts

as put forth by the majority.

The majority

opinion states that at hearing, Mr. Thomas Armstrong,

president

of AKA, testified that the company had been

in the business of

buying,

selling and developing real estate for about two years.

Yet many other facts were revealed at hearing which proved this

characterization to be misleading.

For example,

Mr. Armstrong,

the sole

owner

and president

of AKA, had been previously employed

by another corporation

in a capacity where he oversaw the

development of sites

for future gasoline stations.

Further,

the

purchase which

is the subject

of this litigation was the only

site AKA ever bought and

it

did so with the express intent of

leasing

it

as a gasoline station on

a long—term basis

to an oil

company.

It was only upon initial testing by the potential

lessee

that hydrocarbons were

found to be present

in the soil..

We note this because

inherent

in the majority opinion lies the

premise that AKA

is somehow an “innocent purchaser” who acted in

good faith upon discovery of the leaking USTs.

The record does

not support such a characterization.

120—53

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OWNER/OPERATOR AS AN ISSUE

Both parties

initially submitted that the only issue before

the Board

is whether the UST5 were “in use” on July

28, 1989,

thereby setting the applicable deductible of $100,000 pursuant

to

Section 22.18b(d)(3)(B)(i)

of the Act.

AKA asserted that its

interpretation of

“in use” was consistent with the statute as a

whole.

In supporting the proposition that “in use” refers

to an

affirmative action,

petitioner put forth the statutory definition

of “owner”.

“Owner” means

(A)

in the case of an

underground storage tank in use on November

8,

1984,

or brought into use after

that date, any

person who owns an underground storage

tank

used for the storage,

use, or dispensing of

regulated substances, and

(B)

in the case of

any underground storage tank in use before

November

8,

1984, but no longer

in use on

November

8, 1984, any person who owns such

tank immediately before discontinuation of its

use.

42 U.S.C.

§6991(3).

By raising the definition of

“owner”

in support

of its

interpretation of

the statute, AKA brought forth the question as

to whether the company was even eligible for reimbursement under

the Fund.

In order

to gain access

to the Fund, an entity must

either be an owner or an operator

(Ill, Rev Stat. 1989 chap. 111-

1/2, par.

1022.18b(a).).

The only way AKA could be an owner

under subsection

(A) would be

if the USTs were “in use on

November

8, 1984 or brought into use after that date”.

If that

were the case,

then AKA would automatically be subject to the

$100,000 deductible under

section 22.18b(d)(3)(B)(i) becauseAKA

failed

to register

its tanks with the State Fire Marshal before

July 28,

1989.

If prior

to July 28,

1989,

the owner

or

operator had registered none of the

underground storage tanks

in use on that date

at the site,

the deductible amount.. .shall be

$100,000

rather than $10,000.

Sec.

22.l8b(d) (3) (B) (i)

Thus the meaning of

“in

use”

was

essential

for

establishing

whether AKA was an “owner”.

The Agency and IPMA read this phrase

to mean that

if a storage tank

in a UST system contains even a

residual amount

of a regulated substance on or before July 28,

1989,

then those tanks were “in use” and a $100,000 deductible

would

be

appropriate

if

those

tanks were

not registered.

In

short,

the Agency and

IPMA

contend that

“in use” should be

120—54

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—3—

equated with “containing petroleum”. To do otherwise would,

according

to

the IPMA, contravene the intent of the statute

because such an interpretation would allow owners and operators

of underground storage tanks which have long ceased dispensing

fuel,

regardless of whether or when such tanks were properly

registered with the Office of the State Fire Marshal,

to be

eligible to seek reimbursement for the costs of corrective action

resulting from releases of petroleum from the Underground Storage

Tank Fund at the minimum $10,000 deductible amount.

(Amicus

Br.

at

5).

Such a construction would inadvertently expand the scope

of the program, deplete the fund and defeat the purpose and

intent of this very important program and its implementing

legislation.

(Id. at

5). The Agency joins

in this argument and

further asserts that the words

“in use” are necessary to insure

that USTs installed after July 28,

1989 will not be assigned a

$100,000 deductible

(Resp.

Br.

at

23).

AKA maintained that

“in use on that date at the site”

denotes an affirmative connotation which relates to an intended

purpose.

An abandoned tank,

for example,

is not

in use.

AKA

relies on the term “in use” as set forth

in the definition of

owner and asserts that “in use” refers

to storing, pumping and

dispensing.

We agree.

We find the meaning of “in use” espoused

by AKA to be the most pursuasive indication of what the term

refers to.

The plain meaning of “in use” denotes that which is

being employed for an intended purpose.

The evidence establishes

that Texaco was the last known functioning entity to employ the

tanks,

and

it ceased operations

in 1975.

AKA did not store,

dispense or pump any regulated substance

in this UST system.

In

connection with these uncontested facts, we have reviewed the

Federal Preamble as it pertains to “in use”.

Indications that

a tank

is permanently out of

use are:

(a)If it

is filled with inert solid

material or otherwise rendered unusable,

or

(b)if there

is reason

to believe that

it will

not be used

in the future

(e.g.,

the owner

abandoned the tank,

intakes and vents are

paved over, access piping

is disconnected or

removed, or the tank was sold to a person who

had no use for the tank,

such as a residential

real estate developer).

Fed.

Reg. Vol.

50,

No.

27,

pg.

46605.

(Emphasis added).

Accordingly,

we

have concluded and agree with the Majority

Opinion that the tanks at

issue were no longer

“in use” and thus

AKA is not an “owner” under

this definition.

DISSENTING OPINION OF “OPERATOR”

120—55

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Both the majority and the dissent agree that the remaining

inquiry

is whether AKA is an “operator” und~rstate and federal

regulations.

Operator

is defined consistent with the federal

statutory definition as follows:

“Operator” means any person

in cor~trolof,

or

having responsibility for,

the daily operation

of the UST system.

35 Ill. Adm. Code 731.112.

(Emphasis added.)

The Agency contended that AKA was not an operator because the gas

station had not been operated

(i.e.,

in use)

since Texaco closed

the station in 1975

(Resp.

Br. at

28).

AKA on the other hand,

viewed the Agency’s position as a

red herring

in that an

“operator includes any person having control of an UST”

(Reply

Brief at

3).

Since AKA, by its own admission,

never used the tanks prior

to removal,

there is a rebuttable presumption that AKA failed

to

have “control of the daily operation of the UST system”.

AKA’s

only participation in regards

to

the UST was

to undertake

corrective action.

In our view,

to hold,

as the majority does,

that corrective action equates with “daily~-operation of the UST

system” would broaden the definition and,

in the process, enlarge

the scope of eligibility for certain parties

in direct

contravention of

the plain language of

the: Act.

We read “daily

operation”

to be a limiting factor which denotes an ongoing

activity with the UST system.

The majority’s interpretation of

AKA as an operator ignores the use of the term “daily”

in the

definition of “operator”.

Furthermore, RCRA defines the term “non—operational storage

tank”:

The term “non—operational storage tank” means

any underground storage tank

in which

regulated substances will not be deposited

after

the date of the enactment of the

Hazardous and Solid Waste Amendments of 1984

(November

8,

1984).

42 U.S.C.

Section 9001(7).

There

is no question that AKA falls within the confines of this

definition.

Since we believe that the UST system which AKA had

control of was a “non—operational storage tank”,

it

would be

difficult,

if not impossible to suggest that the petitioner had

“control over the daily operation of the UST system”.

Put

another way, one cannot operate that which

is non—operational.

Having concluded that AKA is neither an “owner” nor an “operator”

within the meaning of the Act, we would hold that AKA is

ineligible

to access the Fund under Section 22.l8b et.

seq.

120—56

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MAJORITY OPINION OF “OPERATOR”

Contrary to our interpretation,

the majority finds that AKA

satisfies the dictates of “operator”

as defined by statute.

The

majority comes to this conclusion despite the following language:

It

is clear that AKA was not the current

operator of

a filling station, or used the

tanks

for that purpose.

However,

the Board

has concluded that AKA became an operator of

the UST system when

it became subject

to the

UST closure regulations.

We do not construe

the definition of operator as applying only to

those persons

in daily operational control

only of tanks

in active service.

(Emphasis added).

(Maj.

Op. at p.

12)

To summarize the majority’s reasoning in this case,

it

appears they are holding that once corrective action is

initiated,

an entity becomes an operator.

Otherwise,

a person

who engaged in corrective action of abandoned tanks would not be

subject

to the jurisdiction of

the Agency under section 22.18b

et,

seq.

The majority has chosen to attack

the problem backwards

by focusing on who takes corrective action as determinative of

who

is an “operator”.

What they fail to understand

is that being

an owner

or an operator

is a condition precedent

to both

eligibility and liability under section 22.18b.

Merely removing

tanks as a commercial necessity does not make a party an

operator;

the limitations inherent

in the statutory definition

prevail over incidental compliance of one aspect of the

regulations

for the UST procram.

Indeed, under the majority’s

ruling, one could deduce that if

a person complied with any

portion of

the UST rules

for any reason,

they would become an

owner or an operator.

In support of

this tenuous holding, the majority cites UST

reimbursement forms,

a landfill case, some ambiguous USEPA

language from

a rulemaking preamble and

a distinguishable court

decision.

The majority fails

to address, however,

how an

abandoned tank can be operated

—

let alone on a daily basis.

In

an attempt

to hold AKA liable under

the UST provisions,

thereby

allowing access

to the Fund,

the majorfty has ignored the term

“daily” and has strained the bounds of

logical reasoning

in orLder

to fulfill

its “environmental” agenda.

The majority fails

to understand that under

the definitions

at issue in this case,

there

is always an “owner” and therefore

always a liable party

under

the existing statute.

That party may

also be the operator,

but such

is not necessarily the case.

According to the testimony,

Texaco would be the owner

in

the case

120—57

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—6—

at bar.

Whether or not there

is a franchisee or lessee who may

be the “operator”

is unclear on the information we have.

Even

so, the point

that an identifiable “owner” exists

—

the very

party who caused this pollution

—

is crucial.

If anything can be

gleaned from the plain meaning of the disputed definitions,

it is

that the intent is

to hold those responsible for the pollution

liable for clean—up costs.

Today’s majority opinion accomplishes a completely contrary

effect.

A holding here that AKA is eligible for reimbursement

leads to an inequitable result

in that the taxpayers and gasoline

consumers of

Illinois wind up funding a clean—up of

the site

while the party who caused the pollution (i.e., Texaco)

walks

away from any prospect of liability.

This

is undisputable.

The

majority has chosen this

route despite language in the Act which

provides AKA with alternative remedies.

Section 22.18(a)(A) of

the Act states:

Nothing

in this Section shall affect or modify

in anyway the obligations

or liability of any

person under any other provision of

this Act

or State or Federal law,

including common law,

for damages,

injury or loss resulting from

a

release or substantial threat of

a release of

petroleum from an underground storage tank.

(Emphasis added.)

AKA is therefore not without recourse even

if

it

is found

to be

ineligible

to access the Fund.

In addition

to a wealth of

common—law theories,

the company could sue

in state court under

various other sections of the Act.

On the other

hand, AKA,

by becoming an operator under

the

majority opinion,

is now subject

to all federal and state

regulations pertaining

to USTs.

Violations of these

requirements

carries a maximum civil penalty of $10,000 for each tank,

for

each day, for each regulatory violation.

RCRA,

Section 9006(d);

35 Ill. Adm.

Code 731

et,

seq.

Given the timeframe involved

in

the instant case

in addition

to the six tanks involved,

the

potential penalty AKA might

receive could conceivably run into

millions

of dollars.

Whereas the Illinois and federal EPA may

choose

to exercise prosecutorial discretion,

both state and

federal law permits citizens

to file civil actions against

regulatory violators.

This Board, and the federal courts, cannot

exercise discretion to avoid hearing such suits.

While AKA can

find comfort in the majority’s decision finding them eligible to

access the Fund,

this relief

is short—lived when AKA’s potential

liability as an operator

is confronted.

What

is perhaps even more disconcerting is the inherent

inconsistency within the majority opinion as evidencedby

the

fact that the majority finds AKA to be an operator after

it

120—58

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—7—

denies the company “ownership” status.

In interpreting “owner”,

the majority,

as pointed out earlier, holds that “in use” denotes

something affirmative rather than the passive meaning put

forth

by the Agency.

The majority correctly states that to equate

“in

use” with “contains”

would effectively limit the “in use” phrase

to mere surplusage.

On the other hand,

when analyzing the

definitional scope of “operator”,

the majority seems

eager

to

embrace the reference to “daily operation” as

irrelevant or

somehow redundant.

35

Iii. Adm.

Code 731.112 defines an

“operator”

as:

...any person

in control of,

or having

responsibility for,

the daily operation of the

UST system.

This

is clearly a definition with two prongs.

The first

tier is satisfied once either control or responsibility is

established.

Under

the limited definition which is present

in

both state and federal statutes,

it is abundantly clear

that to

be an operator one must have control

or responsibility of the

daily operation of

the UST system.

Yet the majority readily

dismisses “daily operation”;

or perhaps more accurately,

construes

it as

“identifying the non-owner person

in daily

responsible charge.”

(Maj.

Op.

at

15).

In any event,

the result

is the same;

“daily operation

of the UST system “is completely

disregarded by the majority.

If “daily operation of the UST

system” refers to the person

in charge., why was

it inserted given

the fact that the first prong

of the definition explicitly refers

to responsible or controlling parties?

To make this holding as

the majority did

is

to ignore

the plain meaning and render the

second aspect o~the definition as mere surplusage, Niven

v.

Siqueria,

109

Iii.

2d 357

(1985),

a method which was clearly

rejected by the majority in its earlier analysis of “in use”.

Other problems are associated with the majority’s

analysis.

After citing the federal preamble for

regulations

which apply only

to owners and ooerators,

the majority states

that “anyone

;iho

removes a closed or abandoned tank must be

either an owner

or an operator who must comply with the closure

provisions

if

so directed by the Agency”

(Op. at 14).

We

interpret th~.slanguage to mean that one becomes an owner or

operator by virtue of Agency labeling.

It

is difficult for

us

to

imagine a more arbitrary or capricious

ruling;

we do not believe

the Act and regulations give

the Agency the discretion to define

who

is

an operator by virtue of a directive

to comply with

closure provisions.

What the majority

is stating

is that

regardless of the definitional limits,

a person

is an owner or

operator

‘~if

so directed by the Agency”.

This statement

disregards

the plain language as well as the intent of

the

statute.

120—59

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—8—

Moreover, the majority also misrepresents the stance of the

Agency. The majority states that:

Compliance with the corrective action

requirements involves repeated notifications

to the Agency, and the filing and approval of

a series

of plans and studies.

(35 Iii. Adm.

Code 731.161, 731.162(b)

and Section

22.l8b(d)(4)).

There is no indication that

the Agency ever objected on the basis that AKA

was not strictly speaking, an “operator”.

(Maj.

Op. at

14)

To the contrary, the Agency has steadfastly maintained that it

is

impossible for AKA to be an operator

in that the company

admittedly never operated the tanks.

In this regard, AKA’s

assertion that

it

is an operator

is somewhat interesting.

In its

reply brief and its

response to the Interim Order

by this Board,

AKA made this argument but failed to supply the Board with the

entire definition of

“operator”.

We would suggest that this was

not for purposes of saving space,

but was rather an intentional

omission given the fact that the company’s testimony at hearing

made it impossible

to fulfill the “daily operation of the UST

system”

requirement.

Finally, the majority’s reliance upon Union Petroleum

Company

v.

United States,

651 F2d 734

(Ct. Cl.l98l)

is

misplaced.

In Union

there was never any question that Union was

an owner and operator

of an oil terminal facility.

There was

also no question that Union was responsible for

the leak which

eventually found

its way into a navigable waterway. The only

issue

in Union

was

whether the tank cars from where the spill

originated was part of Union’s facility.

Since the Federal Water

Pollution Act defined facility as virtually anything,

the court

justifiably answered

in the affirmative.

The portion of Union

quoted by the majority

is contained in

a footnote which

references the Uniform Commercial Code and

is wholly inapplicable

to the case at

bar.

In conclusion,

we disagree with the majority’s analysis

of

“operator”.

Contrary

to well—established

law,

the opinion

disregards the plain meaning of the statute.

See Heritage Bank

and Trust Co.

v. Harris,

88

Ill.

Dec.

87

(1985);

Doran v.

Dept.

of Labor,

72

Ill.

Dec.

186

(1983); Chicago Health Clubs

v.

Picur,

108 Ill. Dec.

431

(1987).

Had the majority’s decisJon rendered a

harmonious effect as

it

relates to the statute as a whole,

we

would feel differently as

the authority exists for

us

to engage

is such a process.

People

v.

Jordan,

103

Ill.

2d 192

(1984).

Yet the precedent espoused today

is devoid of any environmental

or legal benefits and,

at

the same time,

further confuses a

statute which, as drafted,

is already less than a model of

120—60

---

—9—

clarity.

In short,

the majority’s result—oriented approach

ignores well—founded precepts of statutory construction.

Because

we find this approach unacceptable,

we respectfully dissent.

/Jacob D. Dumelle, P.E.

BOard Member

~

rlichael L.

Nardulli

Board Member

I, Dorothy M.

Gunn, Clerk

of the Illinois Pollution Control

Board,

hereby certify that the above Dissej~ingOpinion was

submitted on the

____________

day of

_______________,

1991.

Dorothy M.~unn, Clerk

Illinois Pollution Control Board

120—61