1 BEFORE THE ILLINOIS

2 POLLUTION CONTROL BOARD

4 IN RE: )

5 PRAIRIE RIVERS NETWORK, )

6 versus ) NO. PCB 01-112

7 ILLINOIS ENVIRONMENTAL )

8 PROTECTION AGENCY and )

9 BLACK BEAUTY COAL COMPANY,)

11 The following is a transcript of proceedings

12 from the hearing held in the above-entitled matter,

13 taken stenographically by ROSEMARIE LAMANTIA, CSR, a

14 notary public within and for the County of Cook and

15 State of Illinois, before ELAINA C. KEZELIS, Hearing

16 Officer, at 100 West Randolph Drive, Room 9-040,

17 Chicago, Illinois, on the 12th day of July 2001, A.D.,

18 scheduled to commence at the hour of 10:00 a.m.

L.A. REPORTING (312) 419-9292

1 A P P E A R A N C E S:

2 HEARING TAKEN BEFORE:

4 ILLINOIS POLLUTION CONTROL BOARD,

5 100 West Randolph Drive

6 Room 9-040

7 Chicago, Illinois 60601

8 BY: ELAINA C. KEZELIS , HEARING OFFICER

10 MEMBERS OF THE ILLINOIS ENVIRONMENTAL PROTECTION AGENCY

11 AS WELL AS OTHER INTERESTED ENTITIES AND AUDIENCE

12 MEMBERS WERE PRESENT AT THE HEARING, BUT NOT LISTED ON

13 THIS APPEARANCE PAGE.

L.A. REPORTING (312) 419-9292

1 MS. KEZELIS: Now, having approached the hour of

2 10:00 o'clock, we'll begin.

3 Good morning. Prairie Rivers Network versus

4 Illinois Environmental Protection Agency and Black

5 Beauty Coal Company, PCB 01-112. This is the oral

6 argument in this matter.

7 Good morning. Welcome to those members of the

8 public who are here today to observe the oral arguments,

9 which will be held in this case.

10 I am board member Elaina Kezelis and I'll be

11 proceeding over the argument this morning. Today's

12 argument will take place before the entire board with

13 the exception of members Dr. Flemal and Nicholas Melas,

14 who, unfortunately, have scheduled commitments elsewhere

15 and are unable to be with us today.

16 On June 21st, 2001, the board entered an order

17 granting Black Beauty's request for oral argument.

18 Because this case has a decision deadline of August 10,

19 2001, we scheduled the oral argument for the next

20 available board meeting date, which is today. As

21 specified in our order, only the three named parties

22 will be permitted to make argument to the board.

23 Similarly, only the board members will be asking

24 questions of the parties.

L.A. REPORTING (312) 419-9292

1 Furthermore, as provided in Section 101.7 under

2 the board's procedural rules, the purpose of this oral

3 argument is to address legal questions only, not new

4 facts.

5 The argument shall be timed with 25 minutes

6 allotted to the Petitioner for argument and rebuttal in

7 total and 25 minutes to be divided among the

8 Respondents.

9 In a moment, I'll ask the parties to make their

10 appearances for the record and to identify how they will

11 be allotting their 25 minutes time.

12 The court reporter is present and will be

13 preparing an expedited transcript of these proceedings.

14 If anyone desires a copy of the transcript, you may

15 obtain a copy from the board's clerk office at a cost of

16 75 cents per page or you may obtain a copy directly from

17 the court reporter.

18 I believe we shall be ready to proceed

19 momentarily. First, I'll ask each of the three

20 attorneys to rise and identify themselves and who they

21 represent for the court reporter, as well as indicate

22 the allotment of time by which each of you shall conduct

23 yourselves this morning.

24 MR. ETTINGER: I'm Albert Ettinger. I'm

L.A. REPORTING (312) 419-9292

1 representing the appellant, Prairie Rivers Network here

2 today. I believe the best way to do this is to go 15

3 minutes initially and then save 10 minutes for rebuttal

4 or reply.

5 MR. SOFAT: I'm Sanjay Sofat and I will

6 represent the Illinois Environmental Protection Agency

7 and I will be taking 10 minutes out of 25 minutes

8 allotted to the Respondents.

9 MR. BLANTON: I am W.C. Blanton. I represent

10 Black Beauty Coal Company. I will be using the 15

11 minutes Mr. Sofat which has left.

12 MS. KEZELIS: Thank you.

13 Madam Chairman, would you care to make any

14 additional comment?

15 CHAIRMAN MANNING: Thank you. Thank you, Member

16 Kezelis, for presiding over this proceeding. She is the

17 author of this particular decision that we're about to

18 make.

19 The board looks forward, I don't know how many

20 of you know this, but this is actually the board's first

21 oral argument ever in its history. And we look forward

22 to hearing from the parties as to any procedures to have

23 these oral arguments. We felt this was an important

24 issue being the first third-party permit appeal that

L.A. REPORTING (312) 419-9292

1 looks as if it is going to go to decision. We've had

2 them before but they've been -- actually drawn or

3 dismissed prior to actually the board making a decision

4 on them. So we look forward to hearing the argument of

5 the parties. Listen carefully and we -- one other

6 announcement, we have with us this morning a very new

7 board member, Tom Johnson from Urbana, Illinois. This

8 is Tom's -- Member Johnson's first official action with

9 the board to be with us this morning. Welcome.

10 MR. JOHNSON: Thank you.

11 MS. KEZELIS: Thank you, Madam Chairman. No

12 further matters before us, we shall begin.

13 Madam clerk, Mrs. Gunn, will be maintaining our

14 time keeping for us. She'll notify you only when your

15 time is up.

16 Thank you. You may begin, Mr. Ettinger.

17 MR. ETTINGER: I think I'll test the capacities

18 of my new bifocals by standing today.

19 I'd like to, first of all, say that it is very

20 good that we are able to have oral argument in this

21 case. It is a very important case and it raises a lot

22 of novel issues.

23 It's important, first of all, because of the

24 importance of Little Vermilion River, which is going to

L.A. REPORTING (312) 419-9292

1 receive the discharge from this permit.

2 It's also important because of the novel legal

3 issues, as board Member Kezelis mentioned, that are

4 raised by it.

5 I think the best thing for me to do now is to

6 answer the board's questions and go directly to the four

7 issues that were posed in the board order and deal with

8 those and I hope there will be follow-up questions.

9 There was a lot of paper filed in this case but I think

10 it is important that we be clear here because of the

11 precedent setting nature of this case. All board cases

12 are important, of course, but here we're -- I'm making a

13 mold that may apply to a lot of other cases and it is

14 certainly even more important that we get this one

15 thought through.

16 Going then to that question, question 1, the

17 burden of proof in standard of review in third-party

18 national pollutant discharge elimination system permit

19 appeals.

20 I think the burden here is pretty clear. The

21 Petitioner must show that there were legal errors or

22 that a factual -- or that factual determinations were

23 made that were not supported by substantial evidence in

24 the record. I think this is the normal sort of standard

L.A. REPORTING (312) 419-9292

1 that would be applied in this sort of case. I think the

2 point here though is we, the Petitioner, have the burden

3 at this proceeding but our burden is informed by the

4 burden that went on below. And I think the best analogy

5 here is to look at a case in which it is more drastic

6 that there is a burden share, say a criminal case below

7 in which in the trial court the prosecution has to prove

8 beyond a reasonable doubt that the defendant is guilty.

9 When it comes to an appeal, it's not then -- it's now

10 the defendant has lost in the trial below, he doesn't

11 have to prove beyond a reasonable doubt that he is

12 innocent at this point. What he has to prove is that

13 there is no evidence in the record below showing that he

14 is guilty beyond a reasonable doubt. He is down, you

15 know. He is down, but still the burden above is

16 informed by what the burden was below.

17 And in this case, the burden below was on the

18 applicant, Black Beauty Mining Company, to prove that it

19 qualified, that it was eligible for the permit it

20 received.

21 We maintain that the record in this case doesn't

22 support that, first of all, because there were legal

23 errors made and on the law it is clear to us that the

24 board -- will get down to the standard of review, these

L.A. REPORTING (312) 419-9292

1 two questions sort of mold into each other, on the

2 standard of review, the board really should make its own

3 decision as to the law. This board, of course, is

4 specifically designed to handle just these sorts of

5 legal questions and thus these sorts of scientific legal

6 questions. And so there really is no reason for the

7 board to give any particular deference to the agency,

8 just as an appellate court doesn't give a particular

9 deference to a trial court on legal questions. The

10 appellate court is set up to handle legal questions.

11 This board is set up to interpret its own rules and

12 certainly would be very strange if the PCB would give

13 deference to the Illinois Environmental Protection

14 Agency in interpreting Pollution Control board rules.

15 So, I think that handles the first question.

16 I'd like to look then at what I think is really

17 the key point in the case. And this really -- I

18 believe, we believe determines the appeal, which is the

19 extent of the public participation that should have been

20 allowed on this permit.

21 I think what happened here is that basically the

22 agency came in with a fundamentally defective permit.

23 It was a sort of generic mining permit that applied

24 though that lease -- the -- the lease that was

L.A. REPORTING (312) 419-9292

1 absolutely mandated but they ignored in this case that

2 this was not an ordinary stream, that this was an

3 extremely important water that this was discharging into

4 and that furthermore. So, US Environmental Protection

5 Agency agreed, and, actually, the agency came to agree

6 to some extent, too, and they substantially rewrote the

7 permit.

8 Well, then they come back and then that permit,

9 that substantially rewritten permit, which is improved

10 in theory, though, unfortunately, not in practice, that

11 then goes final immediately without allowing another set

12 of comments.

13 If I may be permitted a slightly melodramatic

14 analogy but one that I think illustrates the point.

15 Let's say, for example, that a contractor came

16 in or a construction and sought a permit to knock down a

17 homeowner's house, fortunately, we don't have permits

18 like that but let's say he asked for a permit to knock

19 down a house. The homeowner comes in and says, oh, my

20 God, don't do that, I need my house, and, furthermore, I

21 need notice so I can get my stuff out of there. The

22 agency that is looking at this permit says, okay, you're

23 right. Contractor, we're going to make a condition on

24 your house knocking down permit that you have to supply

L.A. REPORTING (312) 419-9292

1 this guy with a pop tent and you have to give him at

2 least 10 minutes' notice. At that point, I think, the

3 homeowner would want to say, wait a minute. I need more

4 than a pop tent here and 10 minutes' notice won't allow

5 me to get my stuff out, but that is not what happened

6 here, the permit went immediately to final before the

7 homeowner got his other chance to point out that while

8 perhaps in some sense the permit was improved, it wasn't

9 improved nearly enough to meet his needs or, in this

10 case, the need of the environment. And that is

11 basically what happened here.

12 Now, we're not saying, of course, that every

13 permit has to be renoticed after there are changes to

14 it. If it has been fully aired, in the first situation,

15 as to what should be done, then there are to be changes.

16 Some cases I've commented on, there have been permits

17 that have been commented on in which it is just clear

18 there was a typo in the permit, you know, you say .01,

19 you mean .001 in the permit. Obviously, they don't have

20 to renotice that just to correct that sort of a problem,

21 but when you totally rewrite the permit, change the

22 whole theory of the permit, you got to look at it and

23 see that this thing was done correctly. And it is

24 important in this case because it wasn't done correctly.

L.A. REPORTING (312) 419-9292

1 The key monitoring terms and some of the other terms in

2 this permit were not handled in a way that is going to

3 make the permit conditions work in our view, but we're

4 not asking, by the way, this board to go back and fix

5 the permit. That is not what we see as the board's role

6 in this situation. The role of the board in this

7 situation is to go back to the agency and say, go back,

8 and do what you should have done in the last place, last

9 time, renotice it for public participation, follow the

10 clean water acts, strong, strong policy in favor of

11 public participation on permits, renotice this, let the

12 public take a look at it and then if you see fit, make

13 some of these changes to the monitoring and other

14 elements of the permit that were -- are flaws in the

15 current permit. That strikes us as the proper way to

16 proceed.

17 The second thing that has gone on with this

18 permit that is particularly interesting, and

19 particularly dangerous, is that as to the key monitoring

20 terms that they not only changed the terms after the

21 close of the public comment period without given Prairie

22 Rivers a chance to comment on those changes, but they

23 left some of these things totally open. They issued the

24 permit and said, Black Beauty and the agency six months

L.A. REPORTING (312) 419-9292

1 later are supposed to work out these terms. Now, that

2 is totally unacceptable. What -- imagine, if you will,

3 that they issued a blank permit or not quite blank

4 permit, the permit says, in six months we'll work out a

5 protective permit. Does that allow public

6 participation, if all we've got to do is comment or look

7 at a permit that says to be continued, to be worked out

8 in private six months after the issuance of the permit.

9 That clearly frustrates public participation. And in

10 this case it was on the key monitoring terms, the

11 operations term for the monitoring of the permit that

12 was put off for this period.

13 So I think as far to answer the board's question

14 or summarize we should have been allowed to comment on

15 the revised permit and no major terms should have been

16 left to be worked out six months into the future of the

17 permit without allowing public participation. The

18 homework has got to be done up front. A permit that is

19 basically what is going to go final is what has to be

20 presented to the public, otherwise the public is

21 essentially cut out of the process.

22 CHAIRMAN MANNING: If I might, when would you

23 suggest and how would the Environmental Protection

24 Agency decide when it needs to go back to the public for

L.A. REPORTING (312) 419-9292

1 further review, if it's going to make any changes at all

2 or if those changes are substantive in nature? Or what

3 tests or what sort of advice would you give to the

4 agency in terms of whether it needs to go back to the

5 public or it doesn't need to go back to the public on

6 review of public participation?

7 MR. ETTINGER: It's going to be a judgment call

8 in every case. I think there will be very easy cases in

9 which people point out a typo, they can correct the typo

10 without going to a public notice again. There will be

11 other cases in which it will be difficult or, you know,

12 it will be a close question, there was some debate,

13 maybe somebody raised it during the hearing but they

14 don't really feel it was aired sufficiently by the

15 public on this particular issue and they should raise it

16 again or give the public another chance to look at it.

17 And then there will be very clear cases like we think

18 this one is in which major elements of the permit and

19 the whole theory of the permit in the sense was changed

20 and new monitoring terms were put in in order to take

21 care of this or address these changes that the public

22 has never seen at all before. It seems clear to us in

23 that case it has to be noticed. The board has got a lot

24 of experience in this itself. You're in a good position

L.A. REPORTING (312) 419-9292

1 to give the agency advice on this but, of course, the

2 board issues draft regulations and a judgment has to be

3 made as to whether they have to be going back to public

4 notice again or whether they're ready -- and the board

5 makes these sorts of judgment all the time. And in some

6 cases, if the board feels it has heard enough on this

7 subject, there is no point in getting further public

8 discussion. I would be very surprised though if the

9 board came up with whole new sections of a proposed

10 regulation and then went directly to second notice

11 without giving the public another shot at least

12 discussing the entirely new portions of a regulation or

13 other action by the board.

14 MS. GUNN: His time is up.

15 MR. ETTINGER: I'll have to handle the last two

16 later.

17 MR. SOFAT: May I please the board, I am Sanjay

18 Sofat.

19 The agency asserts that the Black Beauty Coal

20 Company NPDES permit issued by the agency complies with

21 all the applicable laws and is protective of existing

22 users.

23 Now, the agency would like to answer the four

24 specific questions as follows:

L.A. REPORTING (312) 419-9292

1 Regarding question number 4, the agency

2 apologizes for the typographical error. The word "not"

3 should follow the word typically in that sentence.

4 Now, the agency would like to address the burden

5 of proof and standard of review issues.

6 Regarding burden of proof, the general rule

7 believes that -- the agency believes is that an agency

8 may issue a permit in accordance with the regulations of

9 the board and the agency. Also, the administrative

10 agencies are required to apply their rules without

11 making ad hoc exceptions.

12 MS. KEZELIS: Sorry for the interruption.

13 MR. SOFAT: In this case, the agency, based on

14 the information provided by the applicants, provided by

15 this state and federal agencies and the public, issued a

16 permit that is consistent with the board regulations

17 that are applicable to the mine discharges. The permit

18 was issued upon the agency's determination that the

19 applicant has met the requisite burden of Section 39(a)

20 of the act, that is the permit will not cause violation

21 of the act or the regulation. Further, according to

22 this section, it is the duty of the agency to issue such

23 the permit upon truth by the applicant that the facility

24 will not cause a violation of the act or the

L.A. REPORTING (312) 419-9292

1 regulations.

2 As Section 40(e) of the act states, the burden

3 is on the petitioner now. Therefore, for the petitioner

4 to bring a third-party permit appeal at a bear minimum

5 it must provide some evidence to show that the permit as

6 issued will cause a violation of the act or the

7 regulations. The petitioner has done everything except

8 that. The petitioner has been very diligent in making

9 the allegations but all of them fall short of proving

10 that the issued permit will cause violation of the

11 applicable regulations. Mere dislike of the permit

12 conditions or alleging that the permit could have been

13 written in a different fashion is not the kind of burden

14 of proof required by Section 40(e)(3) of the act.

15 Now, the agency will go through petitioner's

16 issues and will attempt to show that the petitioner has

17 failed to meet the requisite burden.

18 The first issues is petitioner argues that the

19 permit, issued permit violates the board's mixing

20 regulations. However, to meet Section 40(e)(3), burden

21 of proof requirement, the petitioner must show that the

22 application of the mixing regulations in this case is

23 mandatory or is required by the law and, therefore, the

24 agency's failure to apply them in this case causes the

L.A. REPORTING (312) 419-9292

1 violation of the applicable regulations. Since the

2 petitioner makes no such showing, it has not met the

3 requisite burden of proof.

4 Next issue, the petitioner argues that since the

5 Advent study has numerous flaws in it the permit issued

6 by the agency is also flawed, however, to me Section

7 40(e)(3), burden of proof requirement, petitioner must

8 show how those deficiencies, if any at all, will cause

9 the violation of the applicable regulations. Since the

10 petitioner makes no such showing it has not met the

11 requisite burden of proof.

12 Third, the petitioner argues that since the

13 permit does not require continuous monitoring of the

14 discharge it violates Sections 309.141(d) and 146(c) of

15 the board regulations and 40 CFR 122.48. However, to

16 meet Section 40(e)(3), burden of proof requirement the

17 petitioner must show that the continuous monitoring is

18 required by these regulations under all circumstances.

19 For example, 40 CFR 122.48, specifically states that

20 "all permit shall specify the requirements concerning

21 the proper use, maintenance and installation, when

22 appropriate, of monitoring equipment or methods." The

23 agency in this case determined that the continuous

24 monitoring is not appropriate because of the infrequent

L.A. REPORTING (312) 419-9292

1 nature of the discharge, which is 8 to 9 times a year,

2 therefore, the petitioner has not met the requisite

3 burden of proof.

4 Fourth, that the petitioner argues that the

5 agency's non-degradation analysis was not open to

6 public, however, to me Section 40(e)(3), burden of proof

7 requirement, the petitioner must show that the agency's

8 non-degradation analysis violates the requirements of

9 Section 302.105 of the board regulations. Since the

10 petitioner makes no such showing it has not met the

11 requisite burden of proof.

12 Last argument, the petitioner argues that the

13 permit is in violation of the applicable regulations as

14 the whole effluent toxicity testing was not applied in

15 this case, however, to meet Section 40(e)(3), burden of

16 proof requirement, the petitioner must show that the

17 whole effluent toxicity testing is an acceptable method

18 for wet weather discharges. It is well accepted among

19 the professionals that such testing is not appropriate

20 for wet weather discharges.

21 In summary, the petitioner's mere belief not

22 based on any scientific findings that the water quality

23 standards would not be met, that the limits in the

24 permit are not stringent enough to protect existing uses

L.A. REPORTING (312) 419-9292

1 and that certain regulations would be violated is not

2 the kind of burden of proof Section 40(e)(3) demands in

3 the third-party permit appeal. The board should not

4 entertain a third-party permit appeal that lacks the

5 most basic element of a permit appeal, the requisite

6 burden of proof. Otherwise, both the board and the

7 agency would have to expend their limited resources on

8 such frivolous appeals.

9 Under standard of review the agency believes

10 that the plain language of the statute should be

11 followed, which states, "The board shall hear the

12 petitioner exclusively on the basis of the record before

13 the agency." However, any evidence that helps illustrate

14 or explain the information considered by the agency

15 during the permit review process should be allowed under

16 this section.

17 Now, the agency addresses the second question,

18 the extent to which the public should have been allowed

19 to participate.

20 The agency argues basically two ways.

21 First, the applicable law does not allow

22 additional public participation.

23 Second, the petitioner argues that the final

24 permit is fundamentally different and, therefore, it

L.A. REPORTING (312) 419-9292

1 should have been given another opportunity to comment.

2 The agency will now go through all the changes that were

3 made to the draft permit and we're trying to show that

4 even under their own standards the changes were not

5 fundamentally different.

6 The first change was that effluent limitations

7 for sulfates were reduced. The agency does not believe

8 that such a change amounts to the petitioner's

9 fundamentally different level and thus does not require

10 additional participation.

11 The second change that was made, a statement

12 that could have allowed the Black Beauty Coal Company to

13 request the removal of sulfate and chloride monitoring

14 from its permit was removed. The agency not does not

15 believe that such a change amounts to the petitioner's

16 fundamentally different level and thus does not require

17 additional participation.

18 Third, the discharge monitoring requirements

19 were increased from one sample per stormwater discharge

20 with a total requirement of three per quarter to daily

21 monitoring of stormwater discharge events with analysis

22 of all mine related constituents. The agency does not

23 believe that such a change amounts to the petitioner's

24 fundamentally different level and thus does not require

L.A. REPORTING (312) 419-9292

1 additional participation.

2 Fourth, all references to discharge from the

3 mine facility being exempt from water quality standards

4 were removed from the permit. The agency does not

5 believe that such a change amounts to the petitioner's

6 fundamentally different level and thus does not require

7 additional participation. This change was made pursuant

8 to the comments received from United States

9 Environmental Protection Agency.

10 Fifth change, additional sedimentation pond

11 operation and maintenance restrictions were incorporated

12 into the permit. The agency does not believe that such

13 a change amounts to the petitioner's fundamentally

14 different level and thus does not require additional

15 participation.

16 The last, additional provisions in the permit

17 regarding biological inventory and water quality

18 monitoring of the Little Vermilion River and the unnamed

19 tributary were added. The sole basis for this change

20 was to accommodate the comments made by the petitioner,

21 state agencies, United States Environmental Protection

22 Agency and the public, therefore, the agency believes

23 that none of these changes were so fundamentally

24 different that they required additional public

L.A. REPORTING (312) 419-9292

1 participation. The petitioner cites village of Sauget

2 to support their argument, but the agency believes that

3 that case can be distinguished here. In that case, the

4 parties were, the petitioners were denied right to

5 comment on the additional conditions, and also they lost

6 the opportunity to ask for public hearing, and,

7 therefore, they lost their right to reserve the issue

8 for appeal. So those were the --

9 MS. GUNN: Time.

10 MR. SOFAT: -- those were the conditions.

11 MS. KEZELIS: I have one question. Thank you.

12 Section 40(e)(3) of the act specifies as you

13 quoted that the board's review is to be based

14 exclusively on the basis of the record before the

15 agency. There has been some argument in the briefs with

16 respect to supplementation by agreement of the parties

17 based on what transpires at the hearing.

18 My question to you is this, if supplementation

19 is not permitted based on Section 40(e)(3) as opposed to

20 40(d), which applies to clean air act cases, can you

21 point to any evidence in the record before the agency

22 regarding any potential effect on the receiving stream

23 and the unnamed tributary of the Little Vermilion River

24 as a result of magnes concentrations in the. . .

L.A. REPORTING (312) 419-9292

1 MR. SOFAT: Board Member Kezelis, I think I

2 would have to look into the record to find that.

3 MS. KEZELIS: All right. That's fair. Thank

4 you.

5 MR. SOFAT: Thank you.

6 MR. BLANTON: May it please the members of the

7 board. My name is W.C. Blanton. I represent Black

8 Beauty.

9 I thank you for the opportunity to present oral

10 argument.

11 I will advise you that the reason I asked for

12 oral argument is that this is a big record with lots of

13 issues and it's a complicated case in many ways, in many

14 ways it is simple. There are numerous issues and many

15 of them are first impression and, frankly, I wanted to

16 be here to answer your questions, not to give a speech.

17 So I would encourage you to set the agenda for me at any

18 point or steer me to what you want to talk about.

19 I would like -- because of the way this case has

20 come up and because the amount of interest in it and

21 because of the involvement of United States

22 Environmental Protection Agency and the commission and

23 the department of natural resources, I think it is easy

24 to get lost in the trees and not see what is really

L.A. REPORTING (312) 419-9292

1 going on in this case. And I would like to bring the

2 board back to some contents of what is going on here.

3 We are talking here about an intermittent stormwater

4 discharge from the surface coal mine that will occur in

5 all likelihood fewer than 10 times a year and it is a

6 discharge that is no different in amount or quality from

7 any other surface coal mine stormwater discharge that

8 this board and this agency have been dealing with for

9 the past 30 years or so. This is not impending doom

10 from asteroids from space that nobody knows anything

11 about. It is just a coal mine surface water. We've got

12 ditches around the mine that collect the run off and

13 hold it in sediment basins until the solids settle out

14 and it goes on into the stream that has no constituents

15 of any particular unusual quality and has constituents

16 that are the same ones that this board addressed first

17 in its temporary rule and then its final rule in 1983,

18 1984 when the board decided that these types of

19 discharges are sufficiently innocuous that coal mines

20 are entitled across the board in this state, absent

21 proof of unusual circumstances that they don't have the

22 same water quality standards and requirements that other

23 industrial discharges have. We're under the subtitle

24 (d) regulations, not (c), as a matter of law, based on

L.A. REPORTING (312) 419-9292

1 this board's familiarity and understanding of these

2 discharges, which are nothing unusual at all. What

3 is -- because of that and because of the law, the

4 Environmental Protection Agency gave us the standard,

5 not the lowest level, not a trash permit, not a junk

6 permit. They gave us the permit that this board mandate

7 in the subtitle (d) regulations we get. Section 406.203

8 says, if you check the right box in your application,

9 you get 406.203 regulations and effluent standards and

10 conditions, not the Part 302 and 303 rules that the

11 petitioner wants in this permit.

12 This was an ordinary case until the citizens who

13 oppose the mine generally on the usual grounds that

14 people don't like coal mines in the neighborhood. If

15 you look at the news articles and the comments in the

16 record, what you're going to find is the local folks

17 understandably, I can see, I work at a coal company,

18 there is noise, there is dust, there is traffic. They

19 have a problem with train loads. They're upset by a

20 coal mine.

21 What happened was that they got Prairie Rivers

22 involved in this. We're near a stream. And I think it

23 is clear from the issues in this case that Prairie

24 Rivers has its own agenda. Mr. Ettinger is very

L.A. REPORTING (312) 419-9292

1 straightforward about it. He wants increased public

2 participation. He wants the differences between coal

3 mine regulations and the rest of the regulations changed

4 and this is his vehicle to try to change law, not have

5 you apply it.

6 When you read the Prairie Rivers's brief and you

7 listen to their argument they want two things. They

8 want citizen's role in this permit and all permits

9 beyond those prescribed by this board's rules. They

10 want things that these rules have been set up by this

11 agency do not provide them. They want that expanded.

12 And they want the difference. And they don't want us to

13 have the right to subtitle (d) regulations. They want

14 to use 40(e) to pull all of the subtitle (c) regulations

15 back into the mining program. This permit is not the

16 place to do it because we're here to ask you to apply

17 the law on our permit with the law as it is written.

18 That is the context. It's very important. I'd like for

19 you to those keep in mind.

20 On the four issues, I can take them out of

21 order, I won't comment on the agency's typo.

22 On the procedures, Mr. Sofat has mentioned and

23 the agency's brief that spoke very clearly, the role of

24 the public and the steps that are taken in a permit are

L.A. REPORTING (312) 419-9292

1 established by Illinois regulations and I can't quote

2 them, I'm not an Illinois practitioner, but in sequence

3 what happens is a draft permit is issued, and we were

4 issued exactly the draft permit we were entitled to

5 under the law. The public is entitled to comment, if

6 there is sufficient interested, and if there is enough

7 interest on important enough issues, they get a hearing,

8 which they got. After that, the agency is mandated to

9 issue a permit based upon the comments that it has

10 received and that is what it did. And if anybody is not

11 happy with the permit terms that they write at that

12 point, their remedy is what we're doing now, is to get a

13 right to take an appeal. There is nothing else in

14 Illinois law that provides an opportunity for the public

15 to participate. What they want is unlawful.

16 Black Beauty as an applicant is entitled to have

17 the agency process its application in accordance with

18 the regulations. It's entitled to not have the agency

19 make up the rules because there happens to be a lot of

20 interest in the permit and because the agency, frankly,

21 responded to the comments by putting conditions in the

22 permit and terms in the permit beyond those that we

23 believe the agency was authorized to do.

24 Now, the case that is critical on this that

L.A. REPORTING (312) 419-9292

1 Prairie Rivers relies on is the Sauget case. It's

2 important to know that the reason why there was a

3 problem there were three fold as Mr. Sofat pointed out.

4 One, the applicant, the comment period for

5 United States Environmental Protection Agency was 30

6 days and they blew the deadline. They were not entitled

7 to have their comments heard because they turned them in

8 after the comment period closed. The regulations say

9 you get 30 days. United States Environmental Protection

10 Agency took longer. The applicant was entitled to rely

11 upon the regulation that says we can't get hammered with

12 something that comes in after the public comment.

13 The second regulation that was violated, not

14 principle, not due process, not I would like this to be

15 the law, the law was violated because the applicant was

16 entitled to get a copy of the comment and they didn't

17 get them. The agency violated the regulations.

18 And third, because of that it lost its right to

19 have an appeal. That's why the case doesn't apply.

20 What the case says is follow the regulations. That's

21 what we want you to hear on procedure, they don't get

22 another bite of the apple because the regulations don't

23 give it to them.

24 Substantively, do the subtitle (c) regulations

L.A. REPORTING (312) 419-9292

1 apply, it's easy, no, they don't. Section 406.203 says

2 if you check the right box, they don't apply. We

3 checked the box. They don't apply. Prairie Rivers

4 tries to bring them in through 406.203(e) saying this

5 general mandate in the permit has to protect the

6 environment trumps our checking the box. That cannot be

7 on the face of it and on this record. 406.203 says

8 there is a presumption that if you apply the 406.203

9 regs, it does protect the environment. There is not one

10 shred of evidence in this case that says that

11 presumption is not fully enforced. There is no evidence

12 in this record to imply that. There are letters,

13 comment, public comments, briefs, speeches saying, we're

14 worried about this. We don't like what you're doing

15 about it. There is not one shred of evidence before the

16 agency or in this board's hearing that says the

17 presumption doesn't apply. And I will concede that if

18 they had some evidence that linked the endangered

19 species and the quality of the river to anything that

20 we're going to put in the waters, if they had one bit of

21 evidence that says, sulfate at 1,000 is bad for mussels;

22 if they have one shred of evidence that magnes is bad

23 for the drinking water; if they have one piece of

24 evidence that linked what they're concerned about to

L.A. REPORTING (312) 419-9292

1 what we're doing, then you might get to 406.203(e), but

2 if you do this, the record answers it. That is the only

3 excuse this agency can possibly have for putting any of

4 those six additional terms in this permit. And what

5 they have done is essentially make us comply with the

6 water quality regulations. We are stuck with Section

7 302.208, general use water quality regs. Those

8 regulations on their face say these water quality

9 standards protect aquatic life. It doesn't say they

10 protect all aquatic life except these three species of

11 fish and mussels. It says these standards do protect

12 aquatic life.

13 To answer Ms. Kezelis' question, when you look

14 at this board's rulemaking in proceeding R 836 back in

15 1984, the issue of magnes as an effluent from surface

16 coal mines was specifically addressed. This board

17 recognized in its final order, which was issued on June

18 29, 1984, which is one of the appendices to our brief,

19 that if you have magnes at 2.0 based upon studies done

20 in this state by a scientist that this board was

21 familiar with, it will not harm aquatic life. That

22 specific question was answered 17 years ago by this

23 board.

24 So, subtitle (d) -- there were also studies done

L.A. REPORTING (312) 419-9292

1 when subtitle (d) was adopted in that proceeding

2 generally that says sulfates aren't a problem for these

3 critters, fluorides aren't a problem, magnes isn't a

4 problem. There is nothing else in this effluent. Iron,

5 they treat it the same as magnes. So when we meet the

6 regular quality standards, as this permit requires us,

7 we have met 406.203(e). We also are required to

8 monitor, to check up specifically to see if those

9 presumptions are not true, to see if the water quality

10 standards somehow don't be protective enough. That is

11 an additional term that has been added.

12 In the face of all of that, Prairie Rivers has

13 produced not one piece of evidence at all, not in

14 comment, not in hearing, not in the brief, not in the

15 hearing we had in May, not one piece of evidence. How

16 in the world, whatever the burden of proof is, can it be

17 met with nothing? We don't have to reach whether it is

18 substantial evidence in this review. We don't have to

19 reach whether we have to prove something or they have to

20 prove something. We know from the statute, we know from

21 the Amron case, they have to prove something. And they

22 need evidence to prove things. You can't just sit and

23 say we're unhappy.

24 Yes, ma'am?

L.A. REPORTING (312) 419-9292

1 MS. KEZELIS: Should the board view the burden

2 of proof for the standard of review differently because

3 this is a third-party NPDES permit?

4 MR. BLANTON: Different from?

5 MS. KEZELIS: Any differently from situations

6 where the petitioner is the permit holder.

7 MR. BLANTON: No, I think the Amron answers

8 that straight up. I understand there was a question

9 when it was decided on whether or not you could even

10 have a third-party appeal and ultimately the court said

11 no, then the statute came in and said yes, but the

12 rational, I mean, you thought you had one back then and

13 you declared that the burdens of proof is the same. You

14 know, the case, your precedent says they must prove that

15 this permit as written will cause a violation of

16 Illinois law. That is the test, that is the standard

17 you've established.

18 Now, I think it is fair to look at the nature of

19 the proceedings because, frankly, we've been wrestling

20 with this from the beginning. We had a fight with the

21 AG's office about whether we could take the depositions.

22 We've had ongoing discussion about whether we can have

23 an evidentiary hearing at all, and, frankly, I think our

24 brief touches on what I now have thought, you know, sort

L.A. REPORTING (312) 419-9292

1 of focus as the day comes, here is what I think the

2 statute means when it says a hearing on the

3 administrative record, I don't think it means

4 administrative review or intra-agency review of the

5 administrative record. If it did, Mr. Ettinger would be

6 right. That is the test that if what you're doing is

7 administrative review of the record, but that is not the

8 language that the statute uses. The statute says a

9 hearing on the record and it doesn't say oral argument

10 on the record. If you have a hearing, American

11 jurisprudence, that means you're having an argument and

12 you have witnesses and the cases that are cited in the

13 Amicus briefs and in our briefs say this is the only

14 chance we as an applicant and, frankly, Prairie Rivers

15 as the public has a chance to exercise its due process

16 rights to cross-examine and otherwise test the evidence

17 on which the permit was done. How can I cross-examine

18 on nothing if this statute doesn't give me a chance to

19 put a witness in a chair and put him under oath? I'm

20 not getting a hearing and I'm not getting my

21 constitutional right. Now, I have come sadly to the

22 conclusion that I don't get anything I want. I think it

23 is clear that this is not a de nova proceeding, but a

24 hearing on the record I think means this, in the

L.A. REPORTING (312) 419-9292

1 responsiveness summary Environmental Protection Agency

2 says --

3 MRS. GUNN: Time.

4 MR. BLANTON: -- we have met your --

5 MS. KEZELIS: We'll let him answer the question.

6 MR. BLANTON: -- we believe that your concern

7 is not valid because, I think at the hearing, the agency

8 and I are entitled to put Mr. Frederick on the stand and

9 say, what did you mean by that and why, because the

10 point is in the record, the issue is in the record. You

11 cannot put everything this agency knows over the last 40

12 years in a responsive summary. You have to -- so if you

13 limit it, if somebody says, where did you get this idea

14 about instantaneous mixing, in the Advent study, I think

15 I'm entailed to have the author say, out of your

16 regulations. And that is what we did. 90 percent of

17 the evidentiary hearing you saw was focused entirely on

18 the agency record. It explained it. It challenged it.

19 It wrapped it up. And if that is the nature of the

20 hearing, then the burdens of proof makes sense. When

21 that hearing is done, they have to prove that this

22 permit violates the law based on the evidence, not just

23 that they're unhappy.

24 CHAIRMAN MANNING: To follow up on that, if

L.A. REPORTING (312) 419-9292

1 Prairie Rivers has any evidence that the permit will

2 violate the act, is it your opinion that it is

3 appropriately presented, the evidence is appropriately

4 presented at the board hearing on the agency

5 determination or is it more appropriately presented to

6 the agency during the review of the permit?

7 MR. BLANTON: I think that they're entitled,

8 they're clearly entitled to do it -- sorry, I may not

9 have heard it correctly, the hearing before the board --

10 CHAIRMAN MANNING: Right, the hearing before the

11 board, the decision of the agency, is it appropriate at

12 that time for Prairie Rivers to present evidence at the

13 board hearing that they believe that the permit as

14 issued by the agency would cause a violation of the act

15 and present whatever or is it more appropriate or only

16 appropriate that they present such evidence before the

17 agency prior to the agency's determination?

18 MR. BLANTON: I think they like we should be

19 safe by trying to put it up in the first place. I view

20 the public hearing before the agency as a consciousness

21 fact issue raising process primarily. If you know -- if

22 you know what is going on enough to put in evidence, you

23 probably should, but, yes, I think they were perfectly

24 entitled to call an expert witness who would say, Dean

L.A. REPORTING (312) 419-9292

1 Hofa(phonetic) of Advent knows nothing. The people that

2 reviewed this with the agency know nothing. Ms.

3 Blacher's(phonetic) letter is absolutely correct about

4 the first time. They brought in an expert to supply

5 this sort of thing that Mr. Lloyd Hemer(phonetic) talked

6 about, I think that would be perfectly fair game, so

7 long as we're talking about issues that were raised

8 before the agency and we're talking about basic factual

9 disputes on that agency record. I mean, if there is a

10 factual dispute that says, does it matter that we are

11 going to be 12 percent of the discharge for an unnamed

12 tributary but only half a percent for the Little

13 Vermilion River and what does that mean to the

14 Georgetown River supply, that -- Georgetown water

15 supply, that issue is on the table in public hearing

16 before the agency, you bet ya, I think they have just as

17 much right as we do to bring in witnesses.

18 CHAIRMAN MANNING: At the board hearing?

19 MR. BLANTON: At the board hearing. I

20 understand that leads to the conclusion that the board

21 winds up in this particular instance in large measure a

22 fact-finder. I understand that that is the necessary

23 implication, can't do anything about it. The only way I

24 can make sense out of what does a hearing on the record

L.A. REPORTING (312) 419-9292

1 mean.

2 MR. ETTINGER: As always in these affairs I have

3 a hundred things I'd like to react to but I think I

4 would like to answer the question the board posed first

5 of all. And the next one related directly to the

6 relationship between the subtitle (d) or 406 regs and

7 the 302 regulations.

8 And I think here the main thing to focus on here

9 is that the 302 regulations weren't passed by the board

10 for sport. They were basically designed in order to

11 establish protective conditions for NPDES permits and

12 protective conditions for aquatic life.

13 What the 406 rules, in our view do, is they do

14 not incorporate all of those rules verbatim, but they

15 do -- at least you have to look to those rules, to the

16 302, 303 rules. And if you're way off the track from

17 them, if you're doing things that totally violate them,

18 then I think you certainly have not set conditions

19 necessary under 406.203(e).

20 And I just want to note on there, Mr. Blanton

21 reads a lot of things into this statute with language

22 regarding presumptions and language in the board's

23 opinion that I didn't see there, so you just have to

24 read the statute for yourself.

L.A. REPORTING (312) 419-9292

1 In that opinion that the board did, setting up

2 the subtitle (d) regulations, the mining industry did

3 ask for a blank check. They did not want this (e)

4 language here and the board said no. So it was the

5 agency's obligation to write conditions on this permit,

6 which would assure and this is the language, necessary

7 to insure that there is no adverse effect on the

8 environment in and around the receiving stream. That is

9 the board's language as to what a mining permit should

10 do. So, no, every jot and tittle of the 203 -- I mean

11 303, 302 regs are not necessary here, but if you're

12 varying from them very much, as they are in this case by

13 using an entire tributary for mixing or are doing a

14 number of other things, which clearly would not be

15 allowed under the mixing rules, or they're doing a

16 number of things, which they're not looking at existing

17 conditions, there has been no biological monitoring of

18 the unnamed tributary, if you're varying very much from

19 those rules, you need to do a lot more than what was

20 done in this case. And you certainly need to explain

21 each and every one of them. And that is not what

22 happened here.

23 The other -- the last question, to get to the

24 questions again, on the wet testing, the last of the

L.A. REPORTING (312) 419-9292

1 board's, United States Environmental Protection Agency

2 in a document that was recognized by Black Beauty's

3 expert as definitive, United States Environmental

4 Protection Agency technical support document for water

5 quality bases toxics control, points out that wet

6 testing is one of three parts of an integrated approach

7 to water quality protection, biological monitor,

8 mechanical monitoring --

9 MR. BLANTON: I'm sorry. I hate to object.

10 Your order specifically said that you were not going to

11 consider things that were brought into this record after

12 this closed. This is the first time we have ever heard

13 anything about this. They had no evidence to support

14 wet testing in the hearing or before the agency's

15 hearing --

16 MR. ETTINGER: I'm referring to his evidence in

17 the hearing and this is a document which is a treatise.

18 The point remains, the point remains that wet

19 testing is recognized and it could be done in this case,

20 even as to an intermittent condition. What you do, they

21 say that in the permit there is a 3 to 1 dilution, it

22 doesn't take a genius to take the discharge from the

23 Riola Mine, which is nearby, or later from this mine,

24 put it in with a 3 to 1 dilution, and then do the whole

L.A. REPORTING (312) 419-9292

1 effluent toxicity testing on that basis, and this

2 certainly could be done.

3 Finally, they, as I said, a large number of

4 points that Mr. Blanton and Mr. Sofat made, but we've

5 got to close sometime, I want to make one major point,

6 which is that they say we have to prove that this will

7 case a violation. Well, that can't be the standard.

8 First of all, that would allow them to blow off all of

9 the procedural protections entirely, not hold a hearing

10 at all, because then at that point it would be our job

11 to prove that the permit, even though none of the proper

12 procedures were used, nonetheless caused the violation,

13 but then furthermore this cause language, it does

14 exactly what I said is wrong here. It's not the -- it's

15 not the job of the criminal, or the guy who is convicted

16 in a lower court to prove beyond a reasonable doubt that

17 he was innocent or even at that point to prove by a

18 preponderance of the evidence that he was innocent.

19 What he has to show is there wasn't evidence introduced

20 in the trial below by which it could be found beyond a

21 reasonable doubt that he was guilty. The question

22 before the board now is whether this record shows that

23 Black Beauty sustained its burden. And we can't. The

24 third-party obviously are not in a position to refute in

L.A. REPORTING (312) 419-9292

1 most cases a showing. For that matter, you know, a

2 permit never causes a violation of the law. They don't

3 have to discharge as much as they're permitted to do.

4 You have to look at what the permit allows and then

5 based on that, look at what that will do. That is part

6 of the problem with the Advent study. They based it on

7 what they presumed they're going to discharge but they

8 don't look at the permit limit. All through this we

9 have to look at the permit limits and assume that is

10 what they're going to discharge because that is what

11 they're allowed to do. They don't have to be as bad as

12 they're allowed to be but for the purposes of the third

13 party, for purposes of permit writing, we have to assume

14 that. We have to assume that in doing the

15 anti-degradation analysis. We have to do that in

16 analyzing the permit. So this notion that we have to

17 prove that they will -- that this will cause a violation

18 is -- just makes no sense at all and can't be the rule.

19 Mr. Blanton's suggestion that the word hearing

20 in this opens up the board proceeding to all of this new

21 evidence at the board level, I think he is just reading

22 too much in that word. There are all types of hearings.

23 This is a hearing in a sense. I don't think that you

24 necessarily read into the idea of the word hearing that

L.A. REPORTING (312) 419-9292

1 you're going to allow all of this new evidence in,

2 particularly when the statute specifically says that it

3 is going to be reviewed on the agency record.

4 And the board -- basically, what we need to do

5 and what we see as the whole process is, is that there

6 is all sorts of informal contacts, all sorts of informal

7 discussions between the permit applicant and the agency

8 before they write the draft permit. They can talk as

9 much as they want. That doesn't have to be on the

10 record. Then it is pencils down, boys. You've got to

11 come in with a draft permit, which is protective. And

12 then there is a 30 day limit for everybody's comments

13 and that includes the applicant. They're not allowed to

14 go back and rewrite the permit either. In this case

15 they say one of the reasons that Sauget was wrong was

16 that United States Environmental Protection Agency was

17 allowed to comment after 30 days. Black Beauty was

18 allowed to comment after 30 days in this permit. We

19 never got another look at that permit after the record

20 was closed but they did. So what we -- so Sauget is

21 precisely applicable to this case for all of the same

22 reasons.

23 So the way we visualize this process is, is that

24 the agency does its homework before for the public

L.A. REPORTING (312) 419-9292

1 hearing, the public comments. If the public points out

2 major things, then they'll correct it. If they have

3 been -- if the matter has been adequately aired in the

4 public hearing, then fine, you can issue a public -- a

5 final permit. If there are totally new changes to the

6 permit, and in this case, we simple disagree with Mr.

7 Sofat and the agency as to the -- the theory is changed.

8 The theory of -- the original theory of the permit was

9 basically that they were going to give them the subtitle

10 (d) limits, when it was pointed out to them that these

11 may not be adequate in this case, then put in some other

12 terms in some ways that we can determine it, in other

13 ways they strengthened the permit, but the places that

14 they tried to fix it, we think needed to have more

15 public participation, just like the homeowner needed

16 another crack to say, hey, a pop tent isn't good enough

17 for me. We had to have a chance to say, okay, you've

18 given me a pop tent that we didn't have before, but that

19 is not going to work. It is not adequate to protect one

20 of the highest quality streams in the midwest.

21 MS. KEZELIS: I have a question, back to your

22 public participation position, after issuance of the

23 draft permit and the final permit was issued, you

24 believe, your client believes that additional public

L.A. REPORTING (312) 419-9292

1 participation was warranted. Can you provide the board

2 with guidance with respect to what circumstances under

3 which additional public participation should be

4 warranted because the statute is solid? You will agree

5 there, will you not?

6 MR. ETTINGER: I would agree the statute doesn't

7 say anything and from nothing implies nothing.

8 MS. KEZELIS: So from where do you draw this?

9 MR. ETTINGER: Yes, the statute doesn't say --

10 MS. KEZELIS: And what post, what mile post or

11 guidemarks would you offer the board for guidance?

12 MR. ETTINGER: I would say, the statute and the

13 board's rule are silent as to when you might have a

14 second ruling, a second hearing.

15 What I did provide in my briefs was United

16 States Environmental Protection Agency rule, which I

17 think is a fairly good rule and gives a fairly good

18 guidance or some guidance as to what it is. It's always

19 going to be a judgment call, but if you've substantially

20 changed the permit, if you've tried to fix something by

21 substituting something else, you've got to give people a

22 chance to look and see whether that something else

23 really fixes the problem. If it is a relatively minor

24 change and if it is thoroughly aired in the agency

L.A. REPORTING (312) 419-9292

1 hearing where the people had a chance to look at it,

2 because it was in the public notice in the first place,

3 then that is fine, but the problem here, of course, is

4 we come into a public hearing, everybody is outraged

5 because it has none of these monitoring protections that

6 we're asking for. Then they come back after the public

7 hearing and they give us something, which on its face is

8 part of what we want, but it just doesn't do the trick.

9 And we needed to have another chance to fix the permit

10 and really take care of the problems that we pointed out

11 in the public hearing, but we were never given that

12 chance to go ahead and fix the permit and assure that it

13 really does what I believe U.S. Environmental Protection

14 Agency and IEPA were trying to do, which was to set

15 limits on the permit that would protect the Little

16 Vermilion River and the unnamed tributary, both of which

17 are very high quality streams.

18 MS. KEZELIS: No other questions. Thank you

19 very much for your participation today and for the

20 public for appearing and attending. Thank you very

21 much. The oral arguments is concluded.

L.A. REPORTING (312) 419-9292

1 STATE OF ILLINOIS )

)SS:

2 COUNTY OF DU PAGE )

3 I, ROSEMARIE LA MANTIA, being first duly sworn,

4 on oath says that she is a court reporter doing business

5 in the City of Chicago; that she reported in shorthand

6 the proceedings given at the taking of said hearing, and

7 that the foregoing is a true and correct transcript of

8 her shorthand notes so taken as aforesaid, and contains

9 all the proceedings given at said hearing.

11 ------------------------------

12 ROSEMARIE LA MANTIA, CSR

License No. 84 - 2661

14 Subscribed and sworn to before me

this day of , 2001.

------------------------------------

16 Notary Public

L.A. REPORTING (312) 419-9292