ILLINOIS POLLUTION CONTROL BOARD
March
8,
1990
CITIZENS UTILITIES COMPANY
)
OF ILLINOIS,
Petitioner,
v.
)
PCB 88—151
(Variance)
ILLINOIS ENVIRONMENTAL
)
PROTECTION AGENCY,
)
Respondent.
MR. DANIEL KUCERA, CHAPMAN
& CUTLER, APPEARED ON BEHALF OF
PETITIONER;
MS. BOBELLA GLATZ APPEARED ON BEHALF OF RESPONDENT.
OPINION AND ORDER OF THE BOARD
(by J. Anderson):
This matter comes before the Board upon a request for
variance filed by Citizens Utilities Company of Illinois
(“Citizens”).
Citizens seeks variance from 35
Iii. Adm.
Code
602.105(a),
“Standards For Issuance”, and 602.106(b),
“Restricted
Status”,
to the extent those rules relate to violation by
Citizens’ public water supply of the 5 picocuries per liter
(“pCi/l”)
combined radium—226 and radium—228 standard of
35
Ill.
Adm. Code 604.301(a).
Citizens seeks variance
to allow issuance
of permits for water main extensions during the period of
Citizens’
non—compliance with the radium standard rather than a
variance from the radium standard itself.
The requested term of
variance is four and one—half years
(54 months)
from the date
variance
is granted.
Based on the record before
it,
the Board denies Citizens’
variance request.
PROCEDURAL HISTORY
The instant matter has antecedents
in
two
prior Board
actions.
In PCB 82—63, on August
5,
1982
(47 PCB 501),
the Board
granted Citizens variance
~rorn
the combined radium standard,
with
the variance terminating on January
1,
1984.
In the second
action, PCB 86—185,
Citizens sought
r~1ief
frbm the same Board
regulations
as
is here
requested.
Inthat matter,
the Board, on
March 24,
1988,
issued an Order granting
a two—year variance.
On
May 19,
1988,
the Board issued an Order vacating this grant of
variance on grounds
that the compliance plan was speculative
109—249
—2—
because
it did not provide
for ultimate compliance with the
radium standard
in the event
that certain litigation then pending
remained unresolved.
In response to Citizens’ motion for
rehearing and reconsideration,
the Board, by Order
off August
4,
1988,
affirmed its May 19, 1988,
Order.
The Board hereby incorporates by reference the Opinion and
Order
in PCB 82—63, dated August
5,
1982,
and the Opinions and
Orders
in PCB 86—185,
dated March
24,
1988; May 19,
1988; and
August
4,
1988.
Citizens
filed its initial Petition for Variance
(“Petition”)
in the instant docket on September
16,
1988.
On
September
22,
1988,
the Board issued an Order
finding the
Petition to be deficient and discussing at length the apparent
difficulty Citizens has had
in submitting an acceptable
compliance plan.
To afford Citizens the opportunity to perfect
its variance
request, ~the Board granted Citizens
45 days
in which
to
cure the articulated deficiencies and stated that the Petition
would
be subject to dismissal
if
no amended petition
was
filed
within that 45 day period.
On October
18, 1988,
Citizens filed a motion requesting the
Board to extend the time
to file an amended Petition by 30
days.
In support
of its
request, Citizens stated that its
personnel, consultants,
and counsel had been involved in other
pending matters.
On October
20,
1988,
the Board entered an Order
granting Citizens until November
25,
1988,
to file its amended
Petition.
Citizens filed
its Amended Petition for Variance
(“Amended Petition”)
on November 10,
1988.
On November
18,
1988,
the Illinois Environmental Protection
Agency
(“Agency”)
filed
a Response
to the Amended Petition
contending that
the petition remained deficient.
On November
23,
1988,
Citizens filed a Reply to the Agency’s Response contending
that
the Amended Petition eliminated any uncertainty regarding
the deficiencies alleged by the Agency and praying that the Board
accept
its Amended Petition.
At its November
29,
1988,
Board
Meeting,
the Board accepted Citizens’
Petition and Amended
Petition and held them for Agency recommendation.
On December 19,
1988,
the Agency filed
a Motion for
Extension of Time,
requesting
that
it be allowed eight additional
days
for
the filing
of
its Recommendation.
That motion was
granted by Board Order
of January
5,
1989.
The Agency’s
Recommendation was filed on December
27,
1988.
The Agency recommends denial
of variance, contending
that
any alleged hardship is self—imposed and that Citizens’
compliance plan is speculative.
Citizens, however,
states that
the compliance plan is
not speculative and emphasizes
that
it
will achieve compliance either by using Lake Michigan water or
by
109—250
—3—
installing
ion exchange equipment,
in the event that Lake
Michigan water
is not available
18 months after
the start of the
variance.
As
to the issue of hardship, Citizens contends that
immediate complLance with the applicable regulations would impose
an arbitrary and unreasonable hardship,
since immediate
compliance would require installation of radium removal equipment
which would subsequently not
be used should compliance be
achieved through the use of Lake Michigan water.
Hearing was held on July 17,
1989;
no members of the public
were present.
Subsequent to hearing, Citizens and the Agency
filed briefs.
OUTSTANDING MOTIONS
On September
15,
1989,
Citizens filed an appeal
to reverse
the Hearing Officer’s Order of September
12,
1989.
In that
order,
the Hearing Officer denied the filing of the affidavit of
Jeffrey Randall.
The Hearing Officer gave his reasons as
follows:
(1)
The submission of the affidavit
is outside the limited
purpose for which
the proofs were left open at hearing;
(2)
The information contained in the affidavit
is not
rebuttal to Respondent’s evidence or exhibits;
(3)
The material in the affidavit,
to the extent that it
is
not merely argumentative,
is duplicative of testimony of
David Chardavoyne to the extent
that it lacks
significant probative value.
Citizens states
that on August
18,
1989,
the Hearing Officer
granted the Agency leave to file a late exhibit.
That exhibit
consists of a copy of a Chancery Court docket sheet and a notice
which indicates that on March
24, 1988,
Village of Glenview v.
Northfield Woods
Water and Utility Company,
87 CH 02577, Circuit
Court of Cook County, was dismissed for want of prosecution*.
Citizens believes that Mr. Randall’s testimony is necessary
to
rebut. information in that docket
sheet and explain the
circumstances surrounding the dismissal.
*
On June
9,
1989, Citizens filed supplemental information which
indicates that the Northfield Woods litigation, which
was
apparently reinstated, was decided
in favor of Glenview on March
29,
1989 on a motion for summary
judgment.
An
October
10,
1989,
supplement indicates that Northfieid Woods’
petition for
rehearing and reconsideration was denied by
the Circuit Court on
August
14,
1989.
Citizens brief indicates
that the decision
is
currently pending
review by the Appellate Court.
109—25 1
—4—
The record indicates that during hearing, Citizens sought
to
question
its witness, David Chardavoyne, regarding responsibility
for alleged delays
in the Northfield Woods proceeding.
The
Agency objected to this line of questioning.
(R.
at 113—117).
The Hearing Officer allowed the Agency leave to file the complete
court docket sheets from the Northfield Woods proceeding to rebut
the testimony of Mr. Chardavoyne.
(R.
at
123).
Citizens did not
object to the filing of such an exhibit at that time, and had
itself also introduced copies
of portions of
the docket sheets.
The Agency’s prehearing discovery regarding the Glenview
proceeding was limited by the Hearing Officer
to matters of
public record.
Although the docket sheets were sought
to be
entered
in rebuttal to Mr. Chardavoyne’s testimony concerning
delay in the Northfield Woods proceeding,
he did not actually
testify regarding such delay since his testimony was barred by
the Hearing Officer as opinion testimony which was not of public
record.
(R.
at
128—130).
Such testimony
was
later contained
in
an offer
of proof.
It
is apparent that what
is sought by the entry
of the
exhibit and affidavit
in this proceeding
is to show that there
was delay
in the No~thfieldWoods proceeding,
and that the delay
either was or was not the “fault”
of Citizens.
One need only
look at the Board’s docket sheet
in this proceeding and note the
number of filings to draw the conclusion that the proceeding has
been protracted.
From review of the record, however,
the Board
notes that its Hearing Officer,
in allowing the Agency
to file
the complete docket
sheet rather than Citizens’
exerpts, was
attempting
to keep the record complete.
Citizens had no
objection to this at hearing.
The Board therefore upholds the
Hearing Officer’s ruling regarding the entry of the Agency’s
exhibit.
Citizens’ motion that the Board
reverse the ruling
of
its Hearing Officer
is hereby denied.
As stated earlier,
however, the Board questions the value
of such evidence to the
resolution of the main issues
in this proceeding.
On September 28,
1989,
the Agency filed
a motion for
sanctions and dismissal
in this proceeding.
Citizens filed
its
response on October
10,
1989,
after
being granted leave
to
file
its response instanter
by the Hearing Officer.
In its motion,
the Agency claims that it has discovered information which
Citizens failed to provide in answer
to the Agency’s prehearing
interrogatories
1,
16,
and 20.
The Agency claims that
it
has
been prejudiced by this failure, and that the failure
is
to such
an extent that further sanctions,
including dismissal,
should be
considered by the Board.
On June 22,
1989,
the Board ruled upon the motions by the
Agency concerning Citizens alleged failure to answer certain
interrogatories.
In
its Order,
the Board
found, among
other
things,
that the Agency had not demonstrated that Citizens had
109—252
—5—
withheld responsive documents
in relation to interrogatories
1
and 16, and allowed the Agency to renew its motion for sanctions
should responsive documents be subsequently discovered.
No
allegations regarding interrogatory 20 were raised at that time.
In light of the principles of discovery,
as explained in its
June 22,
1989, Order,
the Board will review the particular
interrogatories.
*
Interrogatory
1
Interrogatory
1 requested information on any emergency
interconnection between Citizens and Glenview:
State
whether
any
emergency
interconnection
between
Citizens
Utility
Company
of
Illinois
and Glenview was made pursuant
to Construction
Permit
dated
April
23,
1984
attached
as
Exhibit
A
hereto.
State
whether
any
other
interconnection
between
your
supply
and
Glenview was
made within
the past
ten
years.
State
the
date
on
which
each interconnection
was
made,
the
diameter
of
the
water
mains
which
are
connected,
identify
all
documents
relating
to
such interconnection and
identify
all
persons
with
knowledge
of
said
interconnection.
For
purposes
of
this
interrogatory
interconnection
is
defined
as
construction
of
any
water
main
and/or
meter
vault
and
for
any
other
equipment
or
appurtenances which would
join any water main
of
Glenview,
Illinois
with
any
water main of
Citizens Utilities.
The Agency claims that it has found a document which
Citizens did not identify.
The document
is the March
1,
1984,
“Water System Connection Agreement between the Village of
*
The Board,
in its June 22,
1989,
Order, sanctioned Citizens
for its failure
to provide a complete response
to the Agency’s
Interrogatory 12.
Specifically, Citizens failed to provide all
of the documents relating to the estimated costs of designing a
new ion exchange facility for Citizens.
As
a result,
the Board
concluded
that Citizens’
response was “patently unresponsive” and
barred Citizens from introducing any evidence
at hearing
cnn~erningsuch costs
for the
“purpose of demonstrating that
denial of variance would or might impose an a~bitraryor
unreasonable hardship”.
It should benoted,
at this point,
that
the Board’s
ruling continues to be
in effect and will be followed
in this Opinion.
We will therefore disregard any of
the forgoing
information
for purposes of this decision.
109—253
—6—
Glenview, Cook County, Illinois and Citizens Utilities Company of
Illinois” (the “Agreen?nt”)
which concerns an emergency
interconnection betwee~Citizens and Glenview.
Citizens does
not
deny the existence of the document.
Rather,
Citizens states that
the document does
exisi, but that
it
is not relevant to the
instant proceeding,
that
it
is a document of public record,
that
the Agency failed to
a’ail itself of Rule 201(k), and that the
Agency’s motion is unt±~elybecause
it was filed
two months after
hearing.
The document—as-a-~ublic—recordand 201(k) arguments were
raised by Citizens andruled upon by
the Board
in its June
22,
1989,
Order.
In that ~der,
the Board found Citizens arguments
without merit.
The Boird
sees no reason
to change its previous
position.
As to the t3~ielinessof the Agency’s motion,
the Board
specifically gave the ~ency
leave
to renew
its motion for
sanctions should
it di~overthe additional documents as
alleged.
The Board
dii
not give
a cut-off time for
the renewal
of such a motion.
Aithugh the Board does not expect
to allow
the renewal of the Agei~y’smotion
in perpetuity,
the Board finds
the Agency’s motion fi~dtwo months after hearing
to be
timely.
Since a respozive document does exist which Citizens
failed to identify as~questedunder interrogatory
1,
the Board
finds that Citizens fa~edto comply with prehearing discovery
and its actions are sai~tionable. Citizens actions, however,
are
not so unconscionable~to warrant dismissal.
Rather, the Board
finds that the appropr~tesanction
is for the Board not
to
consider information
or issues pertaining
to the type of
information sought
by -±te interrogatory that may be favorable to
Citizens.
Interrogatory 16
With regard to in~rrogatory16,
the Agency sought
information about
obtaiiing water from Mt.
Prospect:
State
and ex~ajn in
detail
all
reasons
why
and
all
bases for
the
statement
in
Paragraph
3,
p.
14, as~ol1ows:
“In
the
early
1980’s,
Citizens
in~tigated
the
possibility
of
obtaining
a apply
by connection
to
a main
of
Mt.
Prospect,
but
such
a
connection
was
determined tobe not feasible.”
Identify all
documents rel~ingto these reasons and bases.
In response to in~errogatory16, Citizens provided a letter
from Mr. Chardavoyne ttMt.
Prospect.
The Agency alleges that
certain testimony indiates that there were calculation studies,
in addition
to the Cha~davoyneletter, which Citizens failed to
identify as requested.
109—254
—7—
The record indicates that Mr. Chardavoyne performed
engineering calculation studies regarding acquisition of water
from Mt. Prospect.
(R. at 269,
273).
Citizens states that these
studies no longer exist,
however, noting in its response to the
Agency’s motion:
Citizens often
performs
informal,
preliminary
in—house
engineering
and
cost
calculations
which
are
not
retained
by
the
Company,
especially
if
the
proposed
project
is
determined
to
be
infeasible
at
a
very
early
stage,
as
was
the
case
with
the
proposed
interconnection
with
Mt.
Prospect.
Such
preliminary
calculations
are
discarded
as
a
matter
of
course.
The
documents
which
the
Agency
claims
Citizens
failed
to
produce
no
longer
existed
at
the
time
the
Agency
propounded
its
Interrogatory
Number
16
and
have not existed for a long time.
(Response at 10)
The Board
finds
that since these studies did not exist at
the time that the Agency propounded its interrogatories, Citizens
did not fail to identify responsive documents as requested
in
interrogatory 16.
The Agency’s motion regarding interrogatory 16
is therefore denied.
Interrogatory
20
In interrogatory 20,
the Agency sought the following:
Identify
all
documents
relating
to Citizens’
first knowledge of the existence of
a contract
between
Glenview
and
Northfield
Woods
which
required
a
connection
fee
to
be
paid
to
Northfield
Woods
under
certain
specified
conditions.
In response, Citizens provided a copy of
a letter from Mr.
Chardavoyne to the Village Manager of the Village of Glenview,
dated March
24, 1983.
The Agency argues that Mr. Chardavoyne identified certain
notes, dated July 15,
1982, at hearing,
that relate
the existence
of a contract between Glenview
arid Northfield Woods which
required a
$350.00 charge per customer.
The Agency argues that
since these notes predate the March
24~,
1983, letter, Citizens
failed to fully
respond
to interrogatory 20.
(Resp.
Ex.
2,
R. at
249—251).
109—255
—8—
Citizens claims that the Agency’s allegations regarding
interrogatory 20 are beyond the scope of the Board’s June 22,
1989, Order and should be stricken.
Although allegations
regarding interrogatory 20 were not made
in the Agency’s prior
motion for sanctions,
the Board declines
to strike the Agency’s
claims.
Citizens does not deny the existence of the document, but
questions its relevance to this proceeding,
an objection
it also
made at hearing.
Citizens also states that
the Agency did not
claim surprise or prejudice
by Citizens not producing the
document.
Citizens claims that this
is especially
true because
the Agency had the document
in
its possession and cross—examined
the witness
regarding the document.
The Board
finds that a document did exist which predates the
document identified by Citizens
in its answer
to interrogatory
20.
The Board therefore finds
that Citizens failed to fully
respond
to interrogatory
20.
The Board also finds that Citizens’
action
is sanctionable.
Citizen’s actions,
however, are not
so
unconscionable as
to warrant dismissal.
Rather,
the Board finds
that the appropriate sanction
is
for
the Board to disregard
information on issues pertaining to the type of information
sought by the interrogatory that may be favorable to Citizens.
BACKGROUND
Citizens provides public utility water service to
approximately 23,000 customers, and sanitary sewer service
to
approximately 22,000 customers,
in
the metropolitan Chicago area
under certificates
of public convenience and necessity granted by
the Illinois Commerce Commission.
Citizens
is an Illinois
corporation and
a public utility within the meaning of the
Illinois Public Utilities Act.
One of Citizens’ certificated service areas, referred to as
“Chicago Suburban”,
comprises portions of
the Village of Mt.
Prospect,
the City of Prospect Heights,
and unincorporated areas
in Wheeling Township, Cook County,
Illinois.
In the Chicago
Suburban service area,
Citizens provides both water and sanitary
sewer service.
As
of July,
1989,
there
were approximately
7,200
residential and commercial units connected to the Chicago
Suburban water
system,
comprised of
a mixture
of single—family
residences, multifamily units, and commercial units.
(R.
at
24).
To provide public utility water service
in the Chicago
Suburban service area, Citizens owns, operates, and maintains an
integrated water supply and distribution system comprised of
four
deep wells and one shallow well,
chlorination equipment,
two
storage tanks,
500 fire hydrants,
and 244,000 feet of water main.
(R.
at
25;
Petition,
par.
4).
Treatment processes to
remove
radium are not presently part of the system.
(Id.)
109—256
—9—
The five wells from which Citizens’ currently draws water
have the following characteristics:
Placed
in
Well No.
Depth
Operation
Capacity
1
213 feet
1960
135 gpm
2
1468 feet
1960
1000 gpm
4
1323 feet
1966
1000 gpm
5
1320 feet
1970
1000 gpm
6
1323 feet
1871
1000 gpm
(Petition,
Exhibit
B)
During calendar year 1987, wells #2 and #4 collectively accounted
for 85
of
the total pumpage.
(Petition,
par.
5).
Citizens initially employed a private laboratory,
Eberline,
to sample wells ~t2,4,
and
6 in October,
1979.
All of the wells
showed radium in excess of the combined radium standard, with
values ranging from 6.9
to 8.0 pCi/l.
These samples were the
basis
for the earlier variance granted
in PCB 82—63.
On December
8,
1985,
the Agency notified Citizens that a
composite of
samples of
its distribution system, taken between
November,
1980,
and July,
1981, and analyzed by the United States
Environmental Protection Agency, showed a combined radium level
of 9.3 pCi/i.
Based on these results, Citizens was placed on
restricted status
in April,
1986.
Notice of the restricted
status appeared in the Board’s April
24,
1986, Environmental
Register and thereafter as listings were received by the Board
from the Agency.
The Board notes that at
no time between January
1,
1984,
when the PCB 82—63 variance terminated, and April,
1986, did the
Agency place Citizens on its restricted status
list;
in
fact,
Citizens was given
a Certificate of Commendation by the Agency
for compliance with all water quality standards
in
1982,
1983,
and 1984.
Nor did Citizens
request further variance relief or
demonstrate that it had come into compliance with the combined
radium standard during that time.
Subsequent
to the initial Eberline analyses, Citizens has
had various samples of
its distribution
systeth analyzed for
combined radium,
with the following results:
109—25 7
—10—
Combined Radium
Collection Date
(pCi/l)
1/21/86
8.4
3/31/86
1.46
5/29/86
3.8
1/12/87
14.2
2/28/87
7.4
4/6/87
7.3
7/9/87
5.9
10/14/87
6.6
l/l2,’88
6.0
4/13/88
1.1
7/13/88
6.5
(PCB 86—185,
March
24,
1988,
p.
3;
Petition,
Ex.
C)
REGULATORY FRAMEWORK
In recognition
of
a variety of possible health effects
occasioned by exposure to radioactivity,
the U.S. Environmental
Protection Agency
(“tJSEPA”)
has promulgated maximum concentration
limits for
drinking water
of
5 pCi/l of combined radium—226 and
radium—228.
Illinois subsequently adopted the same limit as the
maximum allowable concentration under Illinois
law.
The action that Citizens
requests here
is
not variance from
these
two maximum allowable concentrations.
Regardless of the
action taken by the Board
in the instant matter, these standards
will remain applicable
to Citizens.
Rather,
the action Citizens
requests
is the temporary lifting of prohibitions imposed
pursuant
to
35
Ill.
Adm. Code 602.105 and 602.106.
In pertinent
part,
these sections
read:
Section 602.105
Standards for
Issuance
a)
The Agency
shall
not grant any construction or operating
permit required by this Part unl~ss the applicant
submits adequate proof
that
the public water
supply will
be constructed,
modified or operated
so as not
to cause
a violation
off the Environmental Protection Act
(Ill.
Rev. Stat.
1981,
ch. lll~,pars.
1001 et seq.)
(Act),
or
of
this Chapter.
Section 602.106
Restricted Status
a)
Restricted status shall
be defined by the Agency
determination pursuant
to Section 39(a)
of
the Act and
Section 602.105,
that a public water supply facility may
no longer
be issued
a construction permit without
causing a violation of
the Act or this Chapter.
109—258
—11—
b)
The Agency shall publish and make available to the
public,
at intervals of not more than six months,
a
comprehensive
and
up—to—date
list
of
supplies
subject
to
restrictive
status
and
the
reasons
why.
C)
The
Agency
shall
notify
the
owners
or
official
custodians
of
supplies
when
the
supply
is
initially
placed on restricted status by the Agency.
Illinois regulations provide that communities are prohibited
from extending water service, by virtue of not being able to
obtain the requisite permits,
if their water
fails to meet any of
the several standards for
finished water supplies.
This
provision is a feature of Illinois regulations not found
in
federal
law.
It
is this prohibition which Citizens requests be
lifted.
In consideration of any variance,
the Board is required to
determine whether the petitioner would suffer an arbitrary or
unreasonable hardship if required to comply with the Board’s
regulations
at
issue.
Ill.Rev.Stat.1987,
ch.
l1l~,
par.
1035(a).
It
is
normally
not
difficult
to
make
a
showing
that
compliance
with
regulations
involves
some
hardship
because
compliance
with
regulations
usually
requires
some
effort
and
expenditure.
Demonstration of such simple hardship alone
is
insufficient,
however,
to
allow
the
Board
to
find
for
a
petitioner.
Rather,
a petitioner must demonstrate that the
hardship
resulting
from
denial
of
variance
would
outweigh
the
injury of
the public from
a grant of the petition Caterpillar
Tractor Co.
v.
IPCi3 48
Ill.
App.
3d
655, 363 N.E.
2d 419
(1977).
Only with such showing can hardship rise to the level
of
arbitrary or unreasonable hardship.
Moreover, a variance by its nature
is a temporary reprieve
from compliance with the Board’s regulations and compliance
is
to
be sought regardless of the hardship which the
task of eventual
compliance presents an individual polluter.
Monsanto Co.
v.
IPCB
67
Ill.
2d
276,
367 N.E.2d 684
(1977).
Accordingly,
a variance
petitioner
is required, as
a condition
to a grant of variance,
to
commit
to a plan which
is reasonably calculated
to achieve
compliance within the term of the variance.
COMPLIANCE PROGRAM
Citizens proposes
to achieve compliance by
replacing its
present well—based water supply with a water supply drawn from
Lake Michigan.
Since Lake Michigan water does not contain radium
in amounts
in
excess of the
5.0 pCi/i standard, replacement
of
the water supply should eliminate violations of
the combined
radium standard.
The Board
notes
that no one disputes
the
desllability of Citizens changing from well water
to Lake
Michigan water
supply.
109—2
—12—
Citizens has
received
a Lake Michigan water allocation from
the Illinois Department of Transportation since
1980.
(Petition,
Ex.
D).
The
allocation
amounts
increase
from
2.0
million
gallons
per
day
in
1987
to
2.477
million
gallons
per
day
in
2020.
Citizens proposes
to have its water allocation transmitted
to its service area through connection with the water supply
systems of nearby communities.
Specifically, Citizens proposes
to connect
to the supply system of
the adjacent Village of
Glenview (“Glenview”)
which,
in turn,
will
receive water from the
primary supplier,
the Village of Wilmette
(“Wilmette”).
Both
links
in this transmission program,
the Wilmette—Glenview
link
and the Glenview—Citizens link, are controlled by contractual
arrangements.
The most
recent contractual arrangement between Wilmette and
Glenview was entered into on March
3,
1987.
It provides that
Wilmette will supply Glenview with Lake Michigan water sufficient
for all the requirements of Glenview, including water
for resale
by Glenview to Citizens.
(Petition,
par.
12).
Citizens and
Glenview,
in turn,
have entered into an Agreement wherein
Glenview will cause to be constructed
a transmission main and
pumping facilities and will provide a Lake Michigan water supply
to Citizens.
(Petition,
Ex. E).
The Illinois Commerce Commission
approved the Citizens-Glenview Agreement by Order of October
28,
1987.
(Petition,
Ex. F).
;ccording to Citizens, all but one of the conditions
precedent under
its Agreement with Glenview have been satisfied:
the award of a declaratory judgment by
a court, and affirmation
if
appeal
is taken,
that
a certain prior agreement between
Glenview and Northfield Woods Water
&
Utility Co.
Inc.
(“Northfield Woods”)
does not require
a connection fee
to be paid
to Northfield Woods
if
Citizens connects
to Glenview.
Glenview
commenced such a declaratory judgment action on March
18,
1987.
Citizens contends that neither
it
nor Glenview can proceed
with the design and construction of
the facilities necessary to
transmit the Lake Michigan water supply until
the litigation
between Glenview and Northfield Woods
is
resolved.
Citizens
further notes
that
the conduct and timinc
of
the litigation
are
not within
its control.
This not
withstanding Citizens proposed
“primary scenario” compliance schedule wherein the initial
eighteen months of the variance term are reserved for resolution
of
the Northfield Woods litigation.
This “primary scenario”
is
as follows:
Month
Event
of Variance
1)
If declaratory judgment condition
18th month
precedent
is satisfied,
Citizens
109—260
—13—
and Glenview initiate design of
facilities for Lake Michigan water
supply
2)
Citizens and Glenview complete
24th month
design work for Lake Michigan
wa.ter supply
3)
Citizens and Glenview receive
30th
month
necessary permits and easements,
bonding,
complete advertisement,
bid, and award contracts
4)
Gleriview and Citizens start
30th month
construction of facilities
for
Lake Michigan water supply
5)
Complete construction and begin
42nd month
Lake Michigan water
supply from
Glenview
Citizens contends that all of the allotted times
for
intermediate steps in this schedule are maximum times and that
this schedule will be accelerated if any of the steps are
completed ahead of schedule.
(Amended Petition,
par.
11).
This
proviso presumably includes resolution of the Glenview/Northfield
Woods litigation within less than the allotted eighteen months.
In the event that the Glenview/Northfield Woods litigation
is not resolved within the allotted eighteen months, Citizens
proposes
a different compliance program.
This “alternate
scenario” consists of installation of an
ion exchange treatment
facility to remove radium, according
to the following schedule:
Month
Event
of Variance
1)
If the declaratory judgment
18th month
condition precedent
is not
satisfied, Citizens applies to
Illinois Commerce Commission
for
approval for installation of
ion
exchange treatment facilities to
remove
radium.
2)
Illinois Commerce Commission
30th month
approval of ion exchange treat-
ment,
and rescission of prior
approval of Glenview Lake
Michigan water supply agreement
is received.
109—261
—14—
3)
Citizens begins design of
ion
30th month
exchange treatment facilities.
4)
Citizens completes design of
36th month
ion exchange equipment.
5)
Citizens receives necessary
42nd month
permits, complete advertisement,
bid and award contract.
6)
Citizens begins construction
42nd month
of
ion exchange treatment
facilities.
7)
Citizens completes construction
54th month
of ion exchange treatment
facilities.
HARDSHIP
Citizens specifically names two reasons why
a requirement
to
come into immediate compliance would impose an arbitrary or
unreasonable hardship.
First, Citizens notes that
by virtue of
its inability to obtain permits for water main extensions,
any
economic growth
that
is dependent on
those water main extensions
would not be allowed.
An essential consideration
in any request
for variance
relief
is the degree of hardship justifying delayed compliance
with
the standards themselves as well as the proposed timing
of
the compliance
plan.
When the variance relief sought
is from
restricted status,
any special hardship justification
that may be
made for being allowed to deliver noncomplying water
in the
interim to new customers must identify the hardship with some
degree
of particularity.
While postponement
of enforcement
for
Citizens’
noncompliance with the radium standards may
be an
indirect benefit
if
the variance
is viewed by the USEPA as
the
equivalent of an enforcement order,
the
direct relief Citizens
would get
is
its ability to extend its water
lines prior
to
coming into compliance.
Citizens has been on
restricted status
for
four years.
At
no time has Citizens ever
identified, much less particularized,
the nature of any hardship,
economic or otherwise,
that
it
or any
individual, business,
or development has experienced or would
experience
if
it could not get permits
to
extend its water
lines
until
it came into compliance.
Rather,
Citizens has only made the generic statement that
its hardship is
its inability
to extend lines
to developers and
potential customers.
This statement
is
simply a restatement of
109—262
—15—
the effects of restricted status.
At hearing, Citizens did
allude to the inability of the company to respond to an inquiry
from a nearby
“water system municipality” about acquiring their
system or portions thereof,
but Citizens does not explain how
th~eoth~rpotential customers
(who presumably already have
water), Citizens, or C5tizens’ present customers would be
incurring a hardship.
Even
it one were
to hypothesize that
Citizens’ business interests might be beneficially served by
initiating the contacts that might eventually culminate in
purchasing part or all of another water supply, Citizens has
given no explanation as
to why it needs variance now as opposed
to why its “firm” commitment
to come into compliance would not
suffice.
(R. 188,
189; Citizens’
Brief at
4,
17; Reply Brief
at
9).
Second, Citizens alleges that an arbitrary and unreasonable
hardship would result from the immediate installation of costly
radium removal equipment because
it would soon become unnecessary
once Lake Michigan water
is obtained (Petition,
par.
20).
As
Citizens noted:
If
Citizens
were
required
to
install
radium
removal
treatment now,
the equipment would be
rendered
unnecessary
and
useless
where
Citizens achieves
a Lake Michigan water supply
from
Glenview...
This
equipment
has
an
estimated cost of $1,400,000....
Customers in
the
Chicago
Suburban service
area
would
have
to
bear
in
rates
the
revenue
requirements
resulting
from
the
cost
of
such
equipment.
However, they would receive no benefit.
(Citizens’ Brief
at
17,
R. at 185—188)
It
is worth noting that the record indicates that Citizens’
customers may not bear the cost of installation of radium removal
equipment,
as such action would have
to be approved by the
Illinois Commerce Commission.
(R.
at 186—188).
Therefore,
any
hardship that would arguably ensue
from the installation
of
equipment that would later
be abandoned upon receipt
of Lake
Michigan water may be borne by either Citizens, it~customers,
or
both.
During the course of
this proceeding,
the Agency has made
it
clear that
it believes that Citizens’
first priority has not been
to achieve compliance by any reasonable method available to
it.
The Agency points
to
the long history of prior variance
proceedings which date back
to 1982, as evidence
that
Citizens’
hardship is self—imposed.
The Agency also alleges that certain
delays in the Northfield Woods litigation,
such as
the failure to
file suit until 1987,
rather
than after
the 1984 execution of the
109—263
—16—
initial Citizens/Glenview agreement,
is further evidence that
Citizens’ hardship is self-imposed.
(Agency Brief at
1—2).
As
to the timing
of the institution of the Northfield Woods
litagation,
Citizens asserts that because the most recent
agreement between Wilmette and
Glenview was executed
in
1987,
it
would have been premature to file a declaratory action prior
to
that time.
Citizens also asserts that there should be
no finding
of self—imposed hardship because of its failure
to take timely
action
to get Lake Michigan water between the time that its
variance in PCB 82—63 expired on January 1,
1984, and December
8,
1985,
the date that
it received the Agency test results that
showed
a radium violation.
(Reply,
Brief
at ll).*
At this point,
the Board can only
state
that
it shares many
of the Agency’s concerns over whether Citizens
is
committed
to
achieve compliance.
Moreover,
the Board believes that any
possible hardship that Citizens will experience
from this denial
of variance
is largely self—imposed.
First,
with regard
to Citizens’
assertion that there should
be no finding of self—imposed hardship for
its failure
to take
timely action to obtain Lake Michigan water between January
1,
*
Citizens also asserts
that the pending City of Geneva variance
petition,
PCB 89—107,
presents circumstances similar to Citizens,
but that the Agency has been inconsistent
in recommending grant
of variance to Geneva but denial
of variance to Citizens.
(Reply
Brief at
3,4).
Citizens also focuses on the pending
new
USEPA
radium standards (see below), anticipated
in September,
1990, as
well as the
LJSEPA’s and the Agency’s willingness
to entertain
delays
in compliance schedules
for communities which have
committed to compliance and
who
have reasonable construction
schedules.
The Board can only note that any review of the
factors involved and the determinations made (including variance
conditions)
in the past and present proceedings of Geneva and
Citizens show considerable dissimilarities,
not the least
of
which involve dissimilarities
in compliance commitments,
the
reasonableness of the construction schedules,
and the nature
of
the hardship shown.
Speciiically,
the Board notes
that
it
ordered Geneva,
in its PCB
88—11
Opinion and Order,
to proceed
with its compliance plan irrespective of whether
or not
it could
obtain financing;
that Geneva has already spent
or approved over
$5,520,000
in improvements to its water supply system (see
Petition at
5
in PCB 89—107); and that Geneva premised
its
compliance schedule upon
a June,
1990,
proposal date and
a
December,
1991, promulgation date
(see Exhibit B to Petitioner’s
Response
in PCB 89—107).
Finally,
we also reject the notion that
a relaxation by USEPA of
its constraints on the allowable
length
of a variance somehow cures
the deficiencies
in Citizens’
variance request.
109—264
—17—
1984, and December
8,
1985, we remind Citizens that
it was
its
failure to achieve compliance on the timetable given in PCB 82—63
(see below)
that first caused Citizens to be placed on restricted
status.
It was also the impetus for the institution of PCB 86—
185.
Although
trie
issue in PCB 86—185 was whether Citizens
should be denied variance because
it violated three conditions of
the variance granted in PCB 82—63,
the Board gave Citizens the
benefit of the doubt and determined not
to deny the variance,
because of certain Agency actions during the period between
January,
1984, and December,
1985.
We also remind Citizens that
the reason the Board subsequently vacated the PCB 86—185 variance
was because Citizens made
it clear that
it did not intend to
undertake any engineering design initiative for the first year
after
grant of that variance due to the Northfield Woods
litigation.
(See PCB 86—185, Supplemental Opinion and Order, May
19,
1988).
While hindsight causes the Board
to question the
wisdom of its initial decision to give Citizens the benefit of
the doubt for its violations of the PCB 82—63 variance
conditions,
the fact
is
that, even if one were not to consider
the time frame as a fully self—imposed hardship,
it would not be
significant enough to cause
the Board to
ignore Citizens’
long
history of untimely delay in coming to compliance.
With regards
to Citizens’ compliance plan,
the Board
believes that the two scenarios proposed by Citizens are untimely
and unacceptably speculative.
Although Citizens purports
to cure
the deficiencies in its earlier compliance plan that
it presented
in PCB 86—185,
it does not.
As previously stated,
the reason the Board vacated its grant
of the prior PCB 86-185 variance, a variance we note that was
first
filed on October
23,
1986, was because Citizens
subsequently made
it clear that
it did not intend
to undertake
any engineering design initiative
for the first year after grant
of that variance, choosing instead to wait for a successful
outcome in the Northfield Woods litigation that was
instituted in
1987.
Now,
three years after
the litigation was instituted,
Citizens
is again asking for an additional one and one half
years
hiatus after the Board grants variance before instituting
facility design.
The Board notes
that Citizens continues
to
argue
in favor of
this
“no risk” pattern regardless
of the fact
that the court actions on the litigation have so far run
in
its
favor.
Moreover, since Citizens filed this variance petition a
year and one half ago,
Citizens has actually leveraged its
“waiting” time to three years from the filing of this variance,
and four and one half years from the start of the Northifield
Woods litigation.
The Board notes
that part of the delay
in this
proceeding was due
to Citizens’ sanctioned
reëalcitrance in
responding
to the Agency’s discovery requests.
Citizens asserts that
it
is firmly committed, after
a one
and one half years waiting period,
to provide ion exchange
109—265
—18—
treatment for
its existing water
supply source as opposed to
getting lake Michigan water.
It, however,
has
set aside yet
another year before beginning engineering design
in order
to
obtain ICC
rate approval for the ion exchange treatment, and
recission of ICC’s prior approval
for the Lake Michigan water
agreement.
Citizens,
perhaps inadvertently,
has made
a
persuasive argument as
to the speculative nature of getting ICC
rate approval
for
the ion
exchange treatment.
Citizens
emphasizes
that, when the ICC earlier approved Citizens’
rate
request
to get Lake Michigan water,
the
ICC took specific notice
of both citizen complaints about
the quality
of the existing
water supply and of
the desirability of getting Lake Michigan
water.
(R.
at
49;
Pet.
Ex.
F at
5; Citizens’
Brief
at
8,
12).
Citizens also asserts that the ion exchange option
is
undesirable.
(R.
at
45).
The foregoing arguments underlie
Citizens’
claims of arbitrary or unreasonable hardship and
for
waiting again to see whether the litigation can be successfully
concluded in its
favor so as
to get Lake Michigan water.
While Citizens has continued
to argue that
it
is committed
to the first scenario and,
after
18 months,
to the second
scenario
if the litigation
is unresolved or unsuccessful,
Citizens has stated
its intent
to pursue
a
“third” scenario.
Citizens testified that it would not necessarily drop its legal
proceedings at the end of the
18 months but would,
even after
three more years,
when
its ion exchange equipment design
is
essentially complete,
commit to having either Lake Michigan water
on line
(if
the litigation is by then successful)
or
the ion
exchange equipment operating at the end
of
the four and one-half
year period requested
in its second scenario.
The first query we
would make is,
if Citizens thinks
it can get Lake Michigan Water
on line
in one and one half years
under this
“third” scenario
(including time to reinstate the prior Glenview agreement
approval), why is Citizens asking
for two years
in the first
scenario
to do the same thing
(42 months minus
18 months)?
(R.
at
197—201, Reply Brief at
6,7).
Citizens still has a speculative compliance plan.
It still
relies on the pace of the litigation, which
this Board has
already found unacceptably speculative,
to drive
its commitment
to its compliance proposal.
Also, Citizens’
increments of
progress
for facility design and installation
in its first
scenario are patently too slow
if its testimony about
its
timetable
to achieve compliance after “changing horses”
in
its
“third”
scenario is to be believed.
Regarding
its second
scenario,
even
if the Board were
to accept Citizens’
unwillingness
to start design before
it obtains ICC approval,
the
scenario is unacceptable because
it too is
speculative.
If
the
Glenview contract
falls and if the ICC does not approve Citizens’
ion exchange treatment rate request
(which
is a distinct
possibility given
this record),
there
is nothing
left.
Even
if
the ICC were
to give
its approval,
it would
have to doso
in one
109—266
—19—
year
if Citizens is
to stay on
its timetable for achieving
compliance.
Citizens can continue to argue that it has no control over
the pace of the litigation or the ICC’s actions.
Essentially,
that argument begs the question.
Citizens has had control over
•the speed with which
it could have come into compliance.
Citizens has, over the years, made decisions about which
compliance options
it would or would not consider.
It was
Citizens that refused to sign a formal Agreement tendered by JAWA
in
1981.
It was Citizens that chose
to condition the viability
of
the 1984
Glenview
contract on not having
to pay the connection
fee.
The Northfield Woods litigation was not commenced until
1987,
and the Board
is not persuaded
that Citizens, although
it
did not have standing
to initiate the action, could not have
caused
it
to start after
it received the Agency’s test results.
Glenview and Northfield were in discovery and negotiations from
March,
1987, until May,
1988, and the Board
is hardly persuaded
that Citizens did not contribute to the delay.
Finally,
it was Citizens that decided not
to take the
speculative risk of starting any facility designs until
its
compliance plan was firm.
As early as May 6,
1982, Citizens
acknowledged that compliance could be achieved by installation of
ion exchange treatment facilities.
Citizens also had said at
that time that
it could get Lake Michigan water by November,
1983,
or by July,
1984, depending upon which regional
system
Citizens would contract with.
(PCB 82—63).
Since that time
Citizens has relied on the
“cat chasing
its tail” argument
that
it needed time to get Lake Michigan water
so as not to burden
its
customers with paying for the impliedly short term use of
ion
exchange treatment,
but,
on the other hand
it needed
time to see
whether the Lake Michigan water option could become viable at
all.
Now, eight years
later, Citizens argues that
it still needs
time to determine whether the Lake Michigan Water option can be
made viable but “commits”
to installing
ion exchange treatment
thereafter if necessary, while still arguing that its customers
should not
be burdened with paying
for the impliedly short term
use of
ion exchange treatment.
The “short term” argument
suggests, of course,
that Citizens would
install ion exchange
treatment even
if the ICC did not honor Citizens’
rate request
(something Citizens has never suggested
it would or could do),
and that Citizens would seek Lake water
even after the ion
exchange treatment is installed
(which Citizens
has not said
it
would do).*
*
We emphasize here that at no time has the Agency or
the Board
stated that ion exchange treatment was unacceptable;
it was
simply not preferred.
109—267
—20—
Meanwhile, Citizens resisted identifying an existing
connection with Glenview for emergency purposes and has
frustrated the Agency efforts to assess whether this connecti~n
might,
by blending, achieve compliance or
at least reduce the
excess radium in its water.
Citizens’
refusal to present thi~
option
for Agency review
is unacceptable.
As noted earlier
in
its sanctions considerations,
the Bo~rd
will not give weight
to any hardship argur~entregarding costs
that
is favorable
to Citizens.
Although the record does not
contain a reasonable comparison of costs, Citizens has primarily
argued that any economic hardship would
fall on its customers
because
they have
to pay for the short
term use
of
ion exchan~
treatment.
As discussed above,
the premise that ion exchange
would
be. a short term solution
is speculative, and
the assertion
that the costs would
fall on Citizens’
customers
is not
necessarily valid.
PUBLIC INJURY
Although Citizens has not undertaken
a
formal assessment of
the environmental effect of
its variance request,
it
contends
that
a grant of variance will not cause aty significant harm b
the environment or
to the people served
by the potential
watermain extensions
for the limited time
of the requested
variance.
(Petition,
par.
18).
The Agency does not rebut thi~
stating
that while radiation at any level creates some risk,
t~.e
risk associated with Citizens’ water
is low (Agency Rec.
at p~.
25).
In support of these contentiOns, Citizens and the Agency
reference testimony presented by Richard
E. Toohey,
Ph.D.
and
James Stebbins, Ph.D., both of Argonne National Laboratory,
at
the hearings held on July
30 and August
2,
1985,
in
R85—14,
Proposed Amendments
to Public Water Supply Regulations,
35
I1.
Adm.
Code at 602.105 and 602.106.
The Board agrees that there ordinarily would
be little ~
during the term of the variance
to persons newly receiving
Citizens’ noncomplying water.
This assuTes, however,
that
compliance would occur during the term
of the variance,
an
assumption
that cannot be relied upon because of
the speculati~e
nature
of the compliance plan.
We also agree that grant
of
a
variance from restricted status p~ se does not provide dire~r
relief
to persons presently served by the water supply, exce~.
insofar
as grant
of variance by
its conditions may hasten
compliance.
(see City of Joliet
v.
Illinois Environmental
Protection Agency,
PCB 86—121,
November
6,
1986
at
6).
We donot
believe, however,
that grant
of variance
in this case would
hasten compliance.
Citizens’
proposed co~p1iance plan again
makes
it clear that Citizens intends
to continue
to delay ta~rig
any engineering action to remedy the continuing exposure of
~bse
in its service area until
it
is certain
that
it would not in~~
any economic hardship.
In any event,
the lack of any signif~nt
109—268
—21—
hardship showing that
is not self—imposed in this case leaves
little
to consider in relation to our environmental impact
concerns
•
*
ANTICIPATED FEDERAL STANDARD REVISION
The federal standard for radium has been under review for
some time.
In anticipation of a federal revision of the radium
standard,
the Illinois Environmental Protection Act has been
amended at Section 17.6
to provide that any new federal radium
standard immediately supersedes the current Illinois standard.
Nevertheless,
it remains uncertain as
to when and how the radium
standard will actually be modified.
The issue was
raised in the briefs regarding what effect
a
new radium standard would have on Citizens.
The Agency notes an
apparent change
in tJSEPA policy by which USEPA may not object
to
a variance beyond September
30,
1993,
if a supply
is making good
faith,
expedient efforts toward compliance (Agency Brief,
Ex.
A).
The Agency questions whether USEPA will view the “18 month
waiting period” contained in Citizens’ compliance plan as
progressing
toward compliance.
(Agency Brief
at
5).
The Board
is denying Citizens’ variance because
it has not
committed to a firm, much less expeditious compliance effort;
thus, any questions related
to federal policy in this area are
not relevant.
This Opinion constitutes the Board’s findings of fact and
conclusions of law in this matter.
ORDER
For the foregoing reasons the request
for variance by
Citizens Utilities Company of Illinois is denied.
Section
41 of
the Environmental Protection Act,
Ill.
Rev.
Stat. 1987 ch.
111 l/2.par.
1041,
provides for appeal of final
*
We note that Citizens quotes a portion
of a Board PCB 88—11
Opinion (regarding aGeneva variance)
that
finds that
a delay
in
economic development would
cause even a slight hardship to be
arbitrary or unreasonable.
(Reply Brief at 10).
It must be noted
that this statement must be read in the context of the various
Geneva variance proceedings; nevertheless,
the language should
have been, but was inadvertently not, rephras~dprior
to Board
adoption so as to accurately
reflect consistent Board holdings to
the contrary.
In any event, Citizens does not identify a
hardship due to
a delay in economic development,
as had Geneva.
Citizens also fails to note
that Geneva has been subject
to a
stringent compliance plan (see
also PCB 86—225).
109—269
—22—
Orders of the Board within
35
days.
The Rules
of the Supreme
Court of Illinois
establish filing requirements.
IT IS SO ORDERED.
Board Members J.
D.
Dumelle,
J.
T. Meyer and B.
Forcade
concurred.
Board Member
R.
Flemal dissented.
I, Dorothy
M.
Gunn,
Clerk of the Illinois Pollution Control
Board,
hereby certify that the above Opinion and Order was
adopted on the
,~7-
day of
~
£~
,
1990,
by a
vote of
~-
7
/
/
I
~~L
//7.
~i’~—~
~borothy
M.
Gnnri, Clerk
Illinois Pollution Control Board
109—270
