ILLINOIS POLLUTION CONTROL BQARD
December 6,
199.
NORTH SUBURBAN DEVELOPMENT
CORPORATION,
)
Petitioner,
PCB 91—109
v.
)
(UST Reimbursement)
ILLINOIS ENVIRONNENTAL
PROTECTION AGENCY,
Respondent.
DISSENTING OPINION
(by 3. Anderson and M. Nardulli):
We respectfully dissent from today’s action.
We believe
that the majority’s conclusion that
it is bound by a generally
worded state statute whose meaning can be gleaned by looking only
at a federally derived regulation is misplaced.
We do not
believe the Board was so bound and we would have found for North
Suburban on the basis that the Agency had contradicted itself
through its communications with North Suburban and had bound
itself by its first determination.
Any reasonable person would
have relied on the Agency’s first determination and,
as a result,
the Agency should not be allowed to contradict it.
On October 25,
1990, the Agency told North Suburban that it
was eligible for reimbursement from the Fund for its reinediation
costs.
It also delineated some parameters relating to the issue
of which costs were reimbursable (such as the deductible amount).
Nearly seven months after it made its initial determination of
eligibility and reimbursability
(and eleven months after North
Suburban submitted its application for reimbursement), the Agency
sought to further limit North Suburban’s access to the Fund.
The
question that the Board must answer is whether a reasonable
person would have relied on the Agency’s initial determination
and whether that initial determination can be further limited in
scope.
The Act clearly contemplates that an applicant must satisfy
certain requirements before he can be eligible for access to the
Fund.
Section 22.lBb(a)
of the Act sets forth those
requirements.
In addition, Section 22.lBb(d)
of the Act sets
froth certain requirements that must be met before costs can be
considered reimbursable.
Many of the requirements in the two
sections are quite specific.
For example, Section 22.18b(a) (4)
requires an owner to register the tanks with the Office of State
Fire Marshal in accordance with the requirements delineated in
Sections
4 and 5 of the Gasoline Storage Act,
Ill. Rev.
Stat.
128—55
2
1989,
ch.
127½,
pars.
156 and 157, and Section 22.18b(d) (3)
sets
forth in detail how the applicable deductible
is to be
determined.
Unlike the above provisions, however, the “ESDA”
notification requirement of Section 22.18b(d)(4)(D)
applicable to
this case was general in nature.
Section 22.18b(d)
(4)
(D)
states,
in pertinent part, as follows:
Requests for partial or final payment for
claims under this Section shall be sent to
the Agency and shall satisfy all of the
following:
***
D.
The owner or operator notified the State
of the release of petroleum
in
accordance with applicable requirements.
(Emphasis added).
It is clear from the language of Section 22.18b(d) (4) (D)
itself that an applicant must give notification of a release in
accordance with applicable requirements in order to receive its
reimbursement.
In fact,
in Pulitzer Community Newspapers,
Inc.
v.
IEPA, PCB 90-142,
(December 20,
1990), the Board itself
recognized that Section 22.18b(d) (4) (D) was one of the
requirements that had to be met before an applicant could receive
a reimbursement.’
(Id.
p.
6).
Section 22.l8b(d) (4) CD),
however, does not provide any
specific information regarding who needs to be notified and when
notification must be given.
Moreover, although the section
refers to “applicable requirements” and is capable of
interpretation,
no citation is made to any specific requirements
(unlike the tank registration requirement of Section
22.l8b(a)(4)).
Recognizing this lack of specificity, the Board
itself has recognized the linkage between Section 22.18b(d) (4)
and the 24 hour ESDA notification requirement set forth 35
Ill.
Adm. Code 731.150(a),
a regulation that was derived from RCRA’s
financial assurance requirements via the Board’s identical-in—
substance rulemaking in R88—27, and that was effective on June
12,
1989.
Pulitzer at
4.
In addition, the legislature ha~
amended Section 22.18b to specifically exclude remediation costs
‘It
is
important to note that the Board
in Pulitzer never
reached the general issue as to
1
whether pre—ESDA notification
costs are reimbursable.
128—56
3
incurred prior to ESDA notification.2 (HB-l741) Specifically, the
legislature added the following language to the section:
Costs of corrective action or
indemnification incurred before providing
that notification shall not be eligible for
payment.
(See Rockford Drop Forge Co. v IEPA,
No. 2-91-0342 slip op. at
12
(2d Dist 1991)
citing State of Illinois
v. Mikusch,
138 Ill.
2d
242,
252
(1990)).
It is evident from the record
(i.e., North Suburban’s
application for reimbursement)
that the Agency had all of the
facts regarding North Suburban’s ESDA notification at the outset
of its review process.
The Agency expressly determined that
North Suburban was eligible for access to the Fund,
as well as
the various limitations on its eligibility and the
reimbursability of costs, and communicated this information to
North Suburban on October 25,
1990.
In fact, the Agency’s
account technician, who discovered the ESDA notification issue,
testified at hearing as follows:
Q.
Now, just turning back to what your
present position is, you said
is an
account technician,
what generally
are the duties of an account
technician?
A.
In this particular case I reviewed
billings and invoices
in regards to
leaking underground storage tank
claims for reimbursement.
Q.
Okay. And is that the sole
responsibility that you have?
A.
Yes.
***
Q.
Okay.
How did you become aware of
the application filed.by North
Suburban Development Corporation?
A.
It came across my desk after the
2Subsequent
to the
hearing
in
this
case,
the
Agency
also
amended its Fall
199.
LUST guidance manual to reflect the fact that
pre-ESDA notification
costs
are not reimbursable.
(Tr.
32-33;
Reply Br.
Ex.
B
-
p.
21).
128—57
4
deductible amount and eligibility
was determined.
(Tr.
pp.
22-23
-
Emphasis
added).
For the account technician, whose duty it was to review
billings and invoices, to determine, for the first time that
another entire class of costs
(i.e.
pre—ESDA notification costs)
was unacceptable because it contradicts the formal determination
that the’ Agency previously made and communicated to North
Suburban.
In other words, the Agency cannot “limit” and,
in
effect void or repudiate,
its reimbursement determination at the
tail end of its review process once it has already communicated
some of the parameters of that determination to an applicant.
As for the Agency’s assertion that it has “uniformly
interpreted the Act and the regulations to require notification
of ESDA within 24 hours of the discovery of a release”
(ic~.p
6),
I note that the above statement conflicts with the Agency’s
assertion that “it would be unreasonable to require the Agency to
inform an applicant that specific cOsts were not reimbursable
prior to its complete review of all the information submitted by
an applicant.”
(~.
pp.
6,
7—8).
Moreover,
if the Agency has
always considered pre—ESDA notification cOsts non—reimbursable,
there is no reason why the Agency could not have promulgated its
own regulations on the subject or enunciated its position in its
guidance documents in order to place applicants on notice of its
position at the outset of its reimbursement determination
process.
In fact,
Section 22.18b(f)
of the Act explicitly
authorizes the Agency to “adopt reasonable and necessary rules
for the administration of the
Fund).”
Moreover, Section 3.09 of
the Administrative Procedure Act,
Ill. Rev.
Stat.
1989,
ch.
127,
par. 1003.09, defines a “rule” as follows:
“Rule” means each agency statement of general
applicability that implements, applies,
interprets, or prescribes law or policy,
but
does not include
(a) statements concerning
only the internal management of an agency and
not affecting private rights or procedures
available to persons or entities outside the
agency,
(b)
informal advisory rulings...
(c)
intra—agency memoranda or
(d) the
prescription of standardized forms.
Notwithstanding the above,
the Agency,
at the very least,
should have notified North Suburban at the outset of the review
process of its determination regarding pre-ESDA notification
costs.
It did not, however.
Specifically, the Agency,
in its
October 25,
1990 letter to North Suburban, approved North
Suburban’s application for reimbursement with only three caveats,
128—58
5
a $15,000 deductible, the non-reimbursability of costs incurred
prior to July 28,
1989,
and the $500 deduction for North
Suburban’s late tank registration.
I do not see any distinction
between these three caveats and the caveat regarding ESDA
notification.
In other words, once the Agency informs the
applicant
o1
some of the limits on its eligibility and on the
amount of the costs that can be reimbursed
(such as the
deductible amount),
it must inform the applicant of all of the
limits on eligibility and reimbursability.
The failure of the
Agency to include this fourth caveat during its determination is
unfair tb say the least.
We also wish to emphasize that we are disturbed by the fact
that the Agency never informed North Suburban of its stance on
the pre-ESDA notification issue during its eleven month review
process although it had all of the pertinent information
necessary to decide this issue at the outset of the process and
although it had numerous contacts with North Suburban (in person
and via the telephone)
throughout the process.
(Pet.
pp. 5-6
Ex.
K; Stip of Facts pars.
56,
58,
Ex. K
-
pars.
10,
12; Joint
Ex.
2 pars.
56,
58,
Ex.
K
—
pars.
10,
12).
Moreover, the Agency
cannot expect North Suburban to have ra,ised its concerns
regarding the issue when the Agency itself did not document its
position in either its October 25,
1990 letter or its 1989 or
1990 guidance documents
(Tr.
pp.
40—41; Stip of Facts Exs. L
-
pp.
10. 4—10.5, M
-
pp.
14-3-14-4)
and when the Agency’s and
Board’s position regarding the interrelationship of Section
22.18b(d)(4)(D)
and 35 Ill.
Adm. Code 731.150 had not been
publicized
(see Pulitzer, PCB 90—142
(December 20,
1990)).
Accordingly,
for the foregoing reasons, we believe that the
Board should have reversed the Agency’s determination regarding
the non—reimbursability of costs incurred prior to North
Suburban’s notification of ESDA.
~
~
~
~oan
G. Anders
I, Dorothy N. Gunn,
Clerk of the Illinois Pollution Control
Board, hereby certify that,~theabove Dissenting Opinion was filed
on the
c5j/4-’fr
day of
—
/1&~UI1LL~
Illinois P~llutionControl Board
1/
128—59