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ILLINOIS POLLUTION CONTROL BOARD

March 22, 1985

PEOPLE OF THE STATE OF ILLINOIS and  

)

THE ILLINOIS ENVIRONMENTAL PROTECTION 

)

AGENCY                

)

Complainants    

)

v.

)

PCB 83—226

)

ARCHER DANIELS MIDLAND CORPORATION,  

)

a Delaware Corporation,         

)

)

Respondent.

ORDER OF THE BOARD (by J. Marlin):

This matter comes before the Board on a December 9, 1983

complaint filed by the Illinois Attorney General on behalf of the

People of the state of Illinois (People) and of the Illinois

Environmental Protection Agency (Agency). An amended complaint

was filed on June 11, 1984 which alleged that on or about April

14, 1983, respondent discharged benzene at a concentration of

approximately 300 ppm into the waters of the state so as to cause

or threaten to cause water pollution in violation of §12(a) of

Illinois Environmental Protection Act (Act); that allegedly

respondent thereby conducted a hazardous waste disposal operation

without a RCRA permit in violation of §21(f); that respondent

allegedly constructed, installed, operated, or modified equipment

without the necessary Agency permits in violation of §S9(a) and

(b) of the Act and 35 Ill. Adm. Code 201.142 and 201.143.

A hearing was held on November 19, 1984 at which time a

document entitled a stipulation, statement of facts, and

proposal for settlement’ (stipulation) was summarized. The

stipulation was filed with the Board on November 19, 1984.

The stipulation included a conditional statement of facts of

which the parties agreed to only for the purpose of settlement

and only if the Board accepted the stipulation in its entirety.

The respondent, Archer Daniels Midland Company (ADM), neither

admitted nor denied the allegations of the complaint.

It was stipulated that ADM uses benzene to produce anhydrous

alcohol at its Peoria plant, located on the Illinois River. The

Agency summarized into the stipulation its allegations from the

first amended complaint, however, ADM neither admitted nor denied

the allegations in the first amended complaint or the Agency

representations in the stipulation. ADM has installed a

microprocessor based process gas chromatograph in return for the

resolution of this proceeding and has agreed to pay a penalty of

$12,500 to the Illinois Environmental Trust Fund.

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2

Rejection of the Stipulation

The basis for rejection of this stipulation is the Board’s

conclusion that it lacks statutory authority to accept

settlements requiring payment of stipulated penalties and

•imposing compliance conditions without a Board finding of

violation, based either on admissions or evidence contained in

the record. The legislatively—created Board derives its

enforcement powers and duties from the Act and the Administrative

Procedure Act (APA), Ill. Rev. Stat. ch. 127 §1001 et seq.

Section 33(a) of Title VIII: uEnforcementu of the Act empowers

and requires the Board, after hearing, to ‘issue and enter such

final order, 

. . .

as it shall deem appropriate 

. . .

(and shall

file and publish a written opinion stating the facts and reasons

leading to its decision.’ The ‘written opinion’ requirement of

Section 33(a) has a counterpart in Section 14 of the An,

requiring in contested cases ‘findings of fact and conclusions of

law’.

Section 33(b) of the Act provides that ‘(such (Section

32(a) order may include a direction to cease and desist from

violations of the Act or of the Board’s rules, 

. . .

and/or the

imposition by the Board of civil penalties in accord with Section

42 of this Act.’ The pertinent subsection of the Section,

Section 42(a), provides that

‘Any person that violates any provisions of this Act

or any regulation adopted by the Board, or any permit

or term or condition thereof, or that violates any

determination or order of the Board pursuant to this

Act, shall be liable to a civil penalty of not to

exceed $10,000 for said violations and an additional

civil penalty of not to exceed $1,000 for each day

during which violation continues; such penalties may,

upon order of the Board or a court of competent

jurisdiction, be made payable to the Environmental

Protection Trust Fund, to be used in accordance with

the provisions of ‘An Act creating the Environmental

Protection Trust Fund’, approved September 22, 1979,

as amended.

The Act does not specifically mention settlement

procedures. However, pursuant to the authority granted under

Section 26 of the Act, the Board has adopted a procedural rule,

35 Ill. Adm. Code 103.180, permitting and providing requirements

for submittal of a proposed settlement or compromise. A written

statement is to be filed containing, among other things a ‘full

stipulation of all material facts pertaining to the nature,

extent, and causes of the alleged violation’, a proposed

compliance plan, and a proposed penalty. In line with the

hearing requirements of Sections 31 and 32 of the Act, the

written proposal is to be presented at public hearing for citizen

comment on the alleged violations and proposed settlement

terms. The Board has provided that it shall ‘consider such

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proposed settlement or stipulation and the hearing record” and

may “accept, suggest revisions in, reject the proposed settlement

or stipulation, or direct further hearings as it appears

appropriate”

Viewing the ADM stipulation in light of these various

statutory and regulatory requirements, it is clear that the Board

cannot make any required findings of fact and conclusions of law

beyond one that the parties wish to settle the case for $12,500

payable to the Trust Fund, To the extent the Act authorizes the

Board to order payment of a penalty, the authority is premised on

a finding of violation, As the stipulation resists a Board

attempt to make such a finding, and as the Act does not authorize

the Board to accept, on the part of the State, “voluntary

contributions” in settlement of “nuisance suits”, the penalty

portion of the stipulation must be rejected, Regarding the

compliance plan, it appears that the gas chromatograph has

already been installed, The Board notes that in the absence of a

finding of violation, the Board is placed in the position of

ordering accomplishment of “voluntary remedial activities” to

correct “non~existing” non~compliance,

The parties have not addressed the Board~s statutory

authority to accept this stipulation, However, the Board, in

IEPA v, Chernetco, PCB 83~2, February 20, 1985, addressed various

policy arguments by the Attorney General in favor of accepting

that stipulation in the absence of findings of violation, Since

the Board presumes that the Attorney General would make similar

assertions here, the Board will again address them here, In

Chemetco, the Attorney General asserted that the law favors

settlements, that a finding of violation destroys the essence of

the bargain and protracts litigation, and that the Board has in a

few cases imposed fines without a finding of violation, While

not articulated in Chemetco, it might also be argued that the

effect of the Board~s decision interferes with the Attorney

General~s otherwise broad powers of prosecutorial discretions

While these policy arguments might support a legislative

change, they run counter to the Board~splain reading of the

Acts The Board recognizes that the courts have accepted

settlements between two parties without admissions, The courts,

however, have inherent common law powers the Board does not

possess~ Additionally, the Act inherently recognizes that

pollution issues affect the interest of other persons, above and

beyond the parties, as Section 2 of the Act makes clear, The

Board suggests that the Act was deliberately framed to require

the Board to make findings of violations, so as to assure that

compliance and payment of a penalty is a compulsory, not a

voluntary acts Existence or lack of findings of violation may

also be important in the event of subsequent filing of

enforcement actions against the same source: previous findings

of violation may properly be considered as aggravating

circumstances affecting penalty deliberations in later cases,

The Board also notes, pursuant to Section 31, that complaints may

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4

be filed, and settlements reached, by C. ‘-izens who take on the

status of ‘private attorneys general and questions whether wide

prosecutorial discretion al°oaccrues such persons concerning

stipulated penalties and compliance -or.ditions.

Regarding the $12,500 designated by the parties as a

‘penalty’, the Board has earlitr ii tie Opinion found that the

Act does not authorize it to order vo.untary contributions to the

Trust Fund. This is true even apart from the ‘findings of

violation’ issue Specifically regarding the Trust Fund, the

Board is authori. 

to order paymen’s only of unrecoverable

penalties into   

Fund pursuaat fl tte authority granted to the

Board in Sectio  

a) of tne Act as Emended y P.A. 83—0618,

effective Septe  

19, 1983. Penalties do n t encompass

volunary contril  )ns. The 1eois1a~ioncreating the Trust Fund

and a Commissior  adninister it ~as P 

&• 

8s—951 effective

January 1, 1980  

codified as Ill. Rev. Stat. 1983, ch. 111½

11061. That leg. ~tion provides n pertirert port that

‘The Commiss ~ 

may

accep”, reccise end administer.

any grants, g fts, loans, or t~erfunds 

provided

that such monies shall be used only to the purposes

for which they are con’ttbuted a’u. a 

bala ce remaining

shall be returned to the ‘ortribu’o  

•

.‘

The Board wishes to emphasize tnt it loes tot construe the

quoted portions of the Trust Fund Act as giving a potential right

of recovery for penalties ordered to be paid into the Trust Fund

pursuant to Section 42(a) of the Environmental Protection Act.

When the Trust Fund was created, the legislature obviously

envisioned that ‘te furd was o rec.e ye voluntary gifts or

contributions to be u ‘d either for e vironnental purposes or to

be returned so 

•

~.o .rcid frus ratior ...t t e intention of the

donor of the g.h..

Payment ot a pe ...tj for vio ats  f t..e ~n~ironmental

Protection Act i a ~o pulsory, and sot a voluntary, act. There

is no right of recovery for a peia.ty oaid into the General

Revenue Fund. In al’ v.~.ngpenalty no ies to be paid into the

Trust Fund, the legis.~tarehas clean vnplied that such

penalties may, in esoence, be earmr ed for ary appropriate

environmental purpose 

•

The Boari 

c.o id 

ides that to construe the

Trust Fund Act as implying a rig’s of recovery for penalties

deposited into it runs counter to the ir en’ion of the

Environmental Protection Act.

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Certification For lnte~locuLo

This “finding of violation” iss    

C~liabJllty to every

enforcement case brought before the D~~rb~In fact, the Board on

February 20, 1985 rejected several prc~osed et’pulated

settlements requiring payment of oena~t~csor other “gifts” or

“sums” and timely performance of co biianc plans, in five cases

where no findings of violation cou’d e 

rr~d~ IEPAv.

Chemetco,

PCB 83—2 ($20,000 penalty, complia 

et ~r

~-.

schedule), Docket

No. 5—85—143 (Fifth District)~ IEl~ 3~r~Vwe~_~nd2~ic

Service & Jimr 

‘

McDonald, PCB 83 23 (  ~Ud ~r” “prohibition”

from violatior )f the Act) ~

and Herman Zel nrust, PC3 83~83 

S14,000

“payment”, cea and d’~sist rdci  a

al.,, PCB 81—190 ($3,000 penalty 

$~,

rtary contribution”

stepped—up cross connection enforcerne~ propram and JEPA v.

~

PCB 84—3, 84—4 (conso iiat~d~($3,375 penalty,

complex program of system improver ~ts  ~cr these reasons, as

well as the fact that a con~~raryrasu~  

~ inve ended this

action, the 

Board on its own motio h t by ~s as a statment

(also known as a Certificatc of I o ~  

~o allow for

immediate interlocutory appellate re 

i~ ~r L ~i

Board~s Order

pursuant to Supreme Court Rule 5CR) i0~ CR 308(a) provides,

in pertinent part tl~at

“When the trial court, ~n rraki g   

rte~lo utory

order not otherwise appealable, finds that the order

involves a question of raw as to wnich there is

substantial ground for difference of opinion and that

an immediate 

appeal from the order may materially

advance 

the ultimate terrination of the litigation,

the court shall so state in writi~g identifying the

question of la~ nvolved, I  Appell~e Court may

thereupon 

i~s discretion aU~o~an appeal from the

order.”

The Boarci ha~-autnority o I cur. Euc~a a statement (see

~

104 ill, 

Arp~

Lb

285 (1st

Dist,

1982).

Pursuant 

SCP 308, the Boa~dfinds that this Order a)

“involves a 

questron of law as to wh~c there is

substantial

ground for 

difference of opinion~ a ~o

h

irradiate appeal

“may

materially 

advance the ultimate termination of this

litigation”. 

The question of

law certified for appeal is as

follows:

Whether the Board correctly lete mined that it lacks

statutory authority, pursuant to Ill, Rcv~. Stat~, ch,

111 1/2 

Sections

1032, 1033, ard 1O~ cc they relate

to Board acceptance of stipuIIati’~raof fact and

proposals for settlement in e f rce~e~tcases, to

issue Opi~iois and Orders 

iich cry hoard findings

of violation are precludea ~ ro ~errr~of the

stipulation and proposal at 

in it

ch resdondent is

ordered to pay a stipulated p~na~Jor ioluntary

contribution and to timely perform agreed—upon

compliance activities,

Finally, in the event of an interlocutory appeal, the Board

will entertain a motion to stay its Order that this action go to

hearing.

Should the parties determine that they wish to file an

amended settlement agreement containing sufficient admissions of

violation to support the remedy, or to allow the Board to modify

the agreement, they may file the appropriate pleadings within 35

days.

IT IS SO ORDERED,

Board Members J,D, Dumelle and W,N, Nega dissented.

I, Dorothy M. Gunn, Clerk of the Illinois Pollution Control

Board, hereby certify that the above Order was adopted on

the

~

day of 

______

~iI’,

1985 by a vote

of

__________

~

Illinois Pollution Control Board

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