ILLINOIS POLLUTION CONTROL BOARD
March
27, 1986
ILLI7NOIS ENVIRONMCNTAL
PRO-T~kCTIONAGENCY,
Complainant,
)
PCB 80—151
v.
A~C~R DANIELS MIDLAND,
)
Respondent.
-
VINCEMT MO~E’TH, SPECIAL ASSISTANT ATTORNEY GENERAL, APPEARED
ON ~EHALF~ OF COMPLAINANT.
~A!NE~.~BICRES,
ROSENBERG,
ROSENBERG,
BICKES, JOHNSON
&
RICHARDSON, A~PEAREDON BEHALF
O.F
RESPONDENT.
OPiNION
AND
•ORDEE~OF THE BOARD
(by
J.
Theodore Meyer):
This matter comes before the Board on remand from the Fourth
Dict.rict Appellate
Court of
a $40,000 penalty imposed
by the
Boar.~against Archer Daniels Midland
(“ADM”).
Archer Daniels
Midland
v.
Illinois Pollution Control Board, 456 N.E.2d 914
(Ill.
App.
Ct.
1983).
The court sustained
the Board~s findings of
vioLation against ADM hut vacated
and remanded the penalty as
being ~ased
on
an inadequate
foundation.
In
an attempt
to settle
the~.s~ue,the parties
filed
a Stipulation of Penalty on
September 23, 1985 which contemplated
a penalty of $15,000.
By
•ordez of November
7,
1985,
the Board
rejected
the penalty
Stip~J.~ti0fl
as being
inadequate
to aid
in the enforcement of the
Act
ana
ordered
the penalty
issue
back
to hearing.
Hearing was
held ot~January
9,
1986
and the Agency filed
its Second Brief
in
Supp~rtof Penalty on January 22, 1986.
The Respondent’s brief
was filed on February 18, 1986 and the Agency’s reply on March
3,
1986..
The Agency recommends
a penalty in
the amount
of $32,500
along with
a payment of
$1008.04 representing
the value of fish
k111.ed by ADM.
(Compi.
Sec.
Brief
at 14).
ADM,
on the other
hand,
jarges
the Board
to find that no penalty is appropriate or
in ~ti~:~
alternative
to reverse the prior
order
of November
7,
1985
and ect~eptthe stipulation of the parties.
(Resp.
Brief
at 6).
~3rief1y, the circumstances giving rise
to the Agency’s seven
cou~t~cornpiaintagainst ADM are as follows:
ADM owns and
oper~.te.s a soybean extraction plant,
corn germ extraction
plant,
and
.a vegetable oil refinery located
in Decatur,
Illinois.
During rainfall events,
stormwater becomes contaminated when rain
flushes spilled grain and grain products into
the stormwater
—2—
collection system.
ADM retains
as much of the
initial stormwater
as capacity will allow which
is subsequently discharged
to
a
wastewater
treatment system.
However, on various occasions
overflows and bypasses of
the retention system have occurred
which re~sulted in contamined discharges
to a small stream.
This
stream has been dammed
to create
the Homewood Fishing Club Lake
around which approximately 16 residences have been erected.
From
the fishing club lake,
the water
eventually flows
into Lake
Decatur,
a municipal reservoir.
The stormwater bypasses were
found
to violate the Act and the Board’s rules and
a $40,000 fine
was imposed.
On appeal,
the Fourth District upheld
the Board’s
findings
of violation but vacated and remanded the penalty because
it was
arrived
at based on
an unexplained
and unsubstantiated
formula.
Accordingly,
the matter was remanded
to the Board
for “another
determination
as to whether under
all
the circumstances present
any penalty is justified;
and
if so,
to calculate
it
in
conformity with the views expressed
by
the court.”
456 N.E.2nd
at 920.
ADM now argues that this language “broadly insinuates
to
the Board
that this may be
a case where no penalty
is
warranted”
and thus contends that no penalty should be imposed.
(Resp.
Brief at
6).
The Board rejects ADM’s somewhat tortured
construction of the court’s language.
First of all,
if the court
had felt that any penalty was clearly improper
it could have
simply vacated
the $40,000 penalty without any remandnient.
Secondly, contrary
to ADM’s conclusion
that
the court
is
insinuating
a desired
result, the court clearly stated elsewhere
in
the opinion that
“wje
will not
be understood as saying
that a
penalty is,
or
is
not, justified under the circumstances here
present.
That
is
the prerogative of the Board.”
456 N.E.2d at
920.
It could
not be more clearly stated that the court wished
to give no opinion
as
to the advisability of
a penalty
in this
case.
ADM argues alternatively that the Board should reverse its
previous order
and accept
the stipulated penalty of
$15,000.
This argument is based
on the assertion that the “Board
should
assume that the Agency and the Attorney General’s personnel,
in
negotiating
the penalty, would give careful consideration not
only to the record
in this cause
and the directions of the
Appellate Court
.
.
.
but would
also consider the following
elements:
(1)
The spirit of cooperation demonstrated by ADM since the
order
in devising
a compliance plan;
(2)
The effort shown by ADM in producing and constructing
a
facility
to eliminate the problems experienced
in this
area;
(3)
The lack of complaints against ADM since
the orders
in
—3-.
this case;
and
(4)
ADM’s overall environmental compliance
since the orders
were entered.”
(Resp.
Brief at 2).
In response,
the Board first would
like to note that it does
not assume otherwise than that careful consideration goes into
the negotiation of
a settlement agreement.
However,
the parties’
assertion that a settlement
is
fair cannot serve to usurp the
Board of its power
and duty to exercise
its independent
discretion over settlement agreements.
In its posture as
a
review board
over settlements,
the Board
is obligated to ensure
that all penalties will aid
in the enforcement of the Act.
In
its November
7, 1985 order,
the Board
found that under
the
circumstances of this case,
a $15,000 penalty was inadequate
to
do
so.
ADM also argues that the $15,000 stipulation should stand
because
it reflects
a recognition by the parties of ADM’s “spirit
of cooperation” and efforts to achieve compliance
“since
the
orders were entered”
in this case.
However,
as ADM correctly
notes,
these
“factors are not
in the record.”
(Resp.
Brief at
2).
Accordingly, they cannot
serve as the basis
for
a Board
finding
that the stipulated penalty would aid
in the enforcement
of the Act.
Moreover, while compliance efforts taken prior
to a
finding of violation may have
a mitigating effect on the penalty
to be
imposed, compliance efforts taken after
the
finding of
violation are simply irrelevant.
Turning
to the question of what penalty,
if any,
should be
imposed
in this enforcement case,
the Board must consider the
“reasonableness”
of the discharges
in light of the factors listed
in Section 33(c)
of the Act.
The first factor,
Section 33(c)(i),
concerns an evaluation of the character
and degree of
injury or
interference with
the health,
general welfare and physical
property of the people.
ADM argues simply that
the violations
did not pertain to discharges of product waste but only
rainwater.
ADM also claims
as a point in its favor that no toxic
substances were discharged and additionally that there
is no
evidence of any impact outside the immediate Homewood area.
Finally, ADM asks that the Board take judicial notice that in
time
a lake such as Homewood
Lake will eventually silt
in and
that this “practical consideration” must be taken
into account
when looking
at the claimed harm.
The argument that only non—toxic “rainwater” was discharged
by ADM significantly belittles the dramatic effect the discharges
have had
on Homewood Lake.
Residents testified that while the
lake had once been clear, clean and pretty,
it now was “little
short of
a sewer condition.”
(R.
at 510).
Others testified that
the lake now bubbles like
a beer vat and gives off unpleasant
smells.
(R.
at
471,
483,
1237,
1241).
—4—
While many testified that they had bought
their homes,
in
part, because of the lake location,
they feel
that the location
is no longer
an asset.
In fact,
Mrs.
Koontz testified that the
lake impaired
her property value and felt that no one would buy
her house
“if they knew the truth.”
(R. at 469).
In addition to
its effect on property values, the pollution has also impaired
the lake for recreational purposes.
Thus,
the lake is no longer
used for
fishing, swimming and boating
as
it once was.
(R.
at
481—83,
513).
Residents testified that they are even unable
to
use their own backyards at times because
of the “stench”
from the
lake.
(R.
at 469—70,
483,
541).
Mrs.
Hudson testified that on
two occasions
in 1978,
the entire
lower half of her yard was
coated with
an oily tan film after flooding
incidents.
(R.
at
549)
In addition to
its
impairment as
a recreational and
aesthetic resource,
the lake has also been damaged as
a habitat
for wildlife.
According to
a report entitled “Report of
Pollution Caused Fish Kill Investigations of Homewood Fishing
Club Lake
in Macon County on July 28,
1979,”
the pollution caused
by the discharges was
so great
as
to kill off even the hardiest
species of fish, black bullheads, which can survive on one part
per million or less of dissolved oxygen.
(Compl.
Ex.
66).
The
value
of the fish kill on that date was established
to be
$1008.04.
ADM presented no evidence
in refutation.
Residents
testified that stocking Homewood Lake with fish and frogs
resulted
in “finding
them belly up after
an oil bath by ADM.”
(R.
at 471).
Moreover, because
the lake
is no longer able
to
support fish, migrating waterfowl
no longer stop over at the
lake.
Id.
This testimony demonstrates that despite
the alleged silting
in of Homewood Lake,
the environmental harm caused by ADM’s
discharges
is substantial.
The Board
finds that the discharges
have caused substantial injury
to the general welfare and
unreasonably interfered with residents enjoyment of their
property.
The fact that this damage was not caused by toxics,
but by bean meal, corn meal and vegetable oil,
is of little
consolation.
Similarly,
the argument
that there
is no evidence of any
impact outside the immediate Homewood area and that only thirty
people were affected by the discharges
is not persuasive as
a
mitigating factor.
Again,
the fact that the damage could have
been worse
in some degree
is
a small
consolation.
The fact
remains that thirty people’s lives were negatively affected over
an extended number
of years.
More significantly, this argument
is flawed
in that it assumes that damage
to the environment
is
necessarily mitigated whenever
fewer people are involved.
However,
in addition
to its aesthetic and recreational value, as
well
as
its value
as
a property asset, the lake serves as habitat
for plant and wild life.
The damage
to habitat caused by ADM’s
—5—
discharges must also enter
into the calculation
of penalty.
Section 33(c)(ii) concerns the social
and economic value of
the pollution source.
In its order
of March
24, 1983 the Board
found that ADM has substantial social
and economic value but that
value ~s greatly reduced
by its adverse environmental
impact.
Similarly,
the Board
found
in 1983 that the plant is suitably
located
as per Section 33(c)(iii).
The Board noted
that the only
real problem with the location
is that it discharges
to
a small,
shallow lake, but no problem would
exist
if pollution standards
were being met.
There
is no basis
for contravening these
findings
today.
Section 33(c)(iv) concerns
the technical feasibility and
economic reasonableness of reducing
or eliminating
the
pollution.
As
to this point, ADM contends that the plant was
designed
in 1923 without consideration
for environmental concerns
and that no technology exists
to cure the problem.
ADM states
that it has spent $4.5 million on environmental improvements
for
the plant
since acquiring
it
in 1962,
and stands ready to
spend
an additional
$1.0 million on
a solution
if
it can find one.
The Board has previously held that
the burden
of proof
is on
the respondent
to show “that compliance
is not technologically
practicable or economically reasonable.”
EPA v. Victory Memorial
______
PCB 81—116, February 10, 1983.
Thus, ADM must
demonstrate that no
technology exists
to solve
the problem or
that the technology
is
so expensive as to be unjustified.
ADM
has simply not met this burden.
First of all,
it
is clear
that treatment technology does
exist.
ADM has admitted
that the Decatur Sanitary District could
treat
the
flow if ADM were allowed
to direct
it there thus
proving that the discharge
is
in fact treatable.
Moreover, ADM
has shown
that
a 600,000 gallon holding tank could be built for
$600,000.
ADM argues,
however, that the tank might not be
a
final
solution.
This lack of certainty over what the final
solution might be
is insufficient
to establish that no technology
exists.
As noted
by the court on appeal, ADM presented
no expert
testimony to show that alternate means of treating the effluent
were impractical.
All the record
shows
is that ADM was unaware
of an alternative solution.
There
is
no evidence that any other
possible alternatives were even investigated.
Thus, ADM has
failed
to meet its burden of proof as
to the lack of
technological solutions.
Likewise, ADM has failed
to demonstrate
that it
is
economically unreasonable
to curtail or eliminate the
discharges.
In fact, ADM has expressed
a willingness
to spend
up
to $1.0 million.
The economic reasonableness of any alternative
will depend on the environmental improvement expected
to accrue
after
its implementation.
Without more evidence as
to the
—6—
possible solutions,
it
is not possible to reach any conclusion
as
to economic reasonableness
Thus, ADM has failed
to meet its
burden of proof
as to economic irifeasibility.
A~lo~ngwith the Section 33(c)
factors, the Board
is also
required
to determine whether
the imposition of
a penalty will
aid
in the enforcement of the Act.
In this regard,
it
is
arguably inappropriate to impose
a sizable penalty where the
pollution events were totally unforeseeable since
a penalty
cannot encourage avoidance of unforeseeable events.
In this
regard, ADM contends that the major portion of the discharge
incidents was caused by a different
instrumentality each time and
that after each incident ADM rectified the specific problem so
that there was never
a reoccurrence from the same cause.
A review of each of these
incidents was made by the Board
in
its March
24,
1983 order.
ADM contended that each incident was
the result of human
and mechanical errors.
The Agency countered
that the “multiple discharge events call
into question the
adequacy of operation and the degree of preventative maintenance
provided.”
(Compl. Reply Brief
at 1).
The Board agreed,
finding
that ADM’s explanations served largely to demonstrate what could
have,
and should have, been done sooner.
As noted
by the Fourth
District,
the errors may provide
a reason
for
the violations “but
it
is not tantamount to
an excuse.”
456 N.E.2d at
918.
The
recurrence of these “accidents” demonstrates a lack of commitment
on management’s part
to take
a proactive stance to remedy
the
inadequacies
in the system overall.
As noted by the Agency, ADM
had known
for
at least
eight years prior
to the filing of the
complaint that contaminated discharges occurred during heavy
rains.
(Compl.
Sec.
Brief at
4).
Rather than
find
a permanent
solution, management was content
to react
to each flaw
in its
ineffective system as
it manifested itself.
While
the Board
agrees that the incidents were not intentional, failure
to take
appropriate preventative action when called
for, as here,
cannot
be justified by simply calling the
incidents unforeseeable.
Furthermore,
the findings of violations do not concern these
incidents alone.
They also include violations of the limits
for
BaD5, suspended solids, and oil and grease on a monthly basis
from April through September, 1981 (excluding June).
These
violations were not negligible but ranged from approximately
three
to forty—seven times
the permitted discharged levels.
Nor
were
these violations related
to any specific overflow events.
No mitigating evidence is offered by ADM concerning these
violations.
Indeed, the evidence demonstrates that management
let several months transpire before taking corrective action
which
should have been taken at once.
Accordingly,
the Board
finds that a penalty would serve
to
encourage compliance
by ADM,
by causing
a more careful
consideration of the ramifications of acting,
or
failing
to
act,
—7—
in the future so
as to harm the environment.
The sum must be
sufficient
to demonstrate
that “adverse effects upon the
environment
will
be
fully
.
.
.
borne by those who cause
them,”
keeping ~,punitiveconsiderations secondary.
Ill.
Rev.
Stat.
1985,
Ch.
lll—f-/2, par.
1002(b).
By statute,
a maximum penalty of $10,000 for each violation
and
an additional $1,000
for each day the violation continues
could
be imposed.
The Agency, however, recommends
a penalty of
$32,500 with an additional $1,008.04 to be paid for fish
killed.
In considering an appropriate penalty the Board notes
that
ADM’s discharges were clearly of
a serious nature impairing the
lake’s aesthetic
and recreational value and
its value
as habitat
for plant
and animal
life.
Essentially, the discharges changed
an environmental asset into a liability.
While none of
the
incidents were
intentional, ADM failed
to take quick corrective
steps concerning
the monthly violations or preventative measures
concerning
the five “accidental”
incidents.
Moreover, ADM has
done little
to determine exactly what controls would
be necessary
to attain compliance and
their cost.
Thus,
inadequate evidence
to prove technical and economic infeasibility was brought before
the Board.
These failures reflect
a lack of commitment by ADM to
protect the environment
of Homewood Lake.
Although ADM claims
to
have spent
$4.5 million on other environmental controls, these
expenditures have done little
to address the problem at hand.
With these factors
in mind the Board
finds
that a penalty of
$32,500 plus $1,008.04 for fish
killed
is appropriate
as
it will
encourage ADM to act to protect the environment
in the future,
thereby aiding
in the enforcement of the Act.
Finally,
the Board wishes to note that, contrary to ADM’s
contention, financial resources of a violator may indeed
be
relevant
to determining whether
a penalty amount will serve
to
aid
in the enforcement of the Act.
(Resp. Brief at 5—6).
In
a
situation where
a violator’s resources are inadequate
to pay both
the penalty and
take the necessary measures
to achieve compliance
with the Act,
the imposition of
a penalty may arguably not serve
to aid
in
the enforcement of the Act.
There
is no evidence
in
this
record
to indicate that the penalty here imposed will
in any
way impair Respondent’s ability to achieve compliance.
This Opinion constitutes the Board’s
findings of fact and
conclusion of law in this matter.
ORDER
1.
Within 45 days of the date
of this Order ADM shall pay by
certified check or money order payable
to the State of Illinois
a
penalty of $32,500
to be mailed
to:
—8—
Illinois Environmental Protection Agency
Fiscal Services
2200 Churchill Road
Springfield, Illinois 62706
2.
Within 45 days of the date of this Order ADM shall pay
the amount of $1008.04 by certified check or money order payable
to the Wildlife and Fish Fund.
IT
IS SO ORDERED.
I,
Dorothy
M. Gunn,
Clerk of
the Illinois Pollution Control
Board,
hereby certify that the above Opinion and Order was
adopted on the
~
day of
_________________,
1986, by
a vote
of
-7~0
Dorothy
M. Gunn,
Clerk
Illinois Pollution Control Board