ILLINOIS POLLUTION CONTROL BOARD
May 6, 1999
PEOPLE OF THE STATE OF ILLINOIS,
Complainant,
v.
WAYNE BERGER and BERGER WASTE
MANAGEMENT, an Illinois corporation,
Respondents.
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PCB 94-373
(Enforcement - Land)
MARIA M. MENOTTI AND JOSHUA W. GUBKIN, ASSISTANT ATTORNEYS
GENERAL, ATTORNEY GENERAL’S OFFICE, APPEARED ON BEHALF OF
COMPLAINANT; and
JOEL A. BENOIT, OF MOHAN, ALEWELT, PRILLAMAN & ADAMI, APPEARED ON
BEHALF OF RESPONDENTS.
OPINION AND ORDER OF THE BOARD (by M. McFawn):
This case is before the Board on the six-count “First Amended Complaint” filed by
complainant the People of the State of Illinois on November 7, 1996, against Wayne Berger
and Berger Waste Management, Inc. The complaint alleges that the respondents violated the
Environmental Protection Act (Act) (415 ILCS 5 (1996)) and its implementing regulations in
the operation of a landfill near Olney, Illinois, in Richland County. Also before the Board is
the respondents’ appeal of an evidentiary ruling of the hearing officer excluding evidence of
settlement offers, as well as various motions.
At the outset, the Board affirms the hearing officer’s evidentiary ruling. After
considering the record, the Board finds respondent Wayne Berger liable for the violations
alleged in counts I, II, III and V of the complaint, but not liable for the violations alleged in
counts IV and VI of the complaint. The Board finds that respondent Berger Waste
Management, Inc., is not liable for any of the alleged violations. The Board revokes Mr.
Berger’s supplemental permit and imposes a monetary penalty of $30,000 against Mr. Berger.
Mr. Berger is directed to immediately close the landfill in accordance with 35 Ill. Adm. Code
814.Subpart E.
The Board also grants respondents’ motion for sanctions, and as a sanction strikes
complainant’s request for attorney fees.
2
BACKGROUND FACTS
In 1979, respondent Wayne Berger began operating a landfill on property behind his
home outside of Olney, Illinois. Tr. at 216-17, 494-96, 500-01. The landfill is a trench
landfill, covering approximately seven acres. Tr. 216, 515, 562, Comp. Exh. 6. The landfill
received residential waste collected from towns around the landfill by a trash hauling business
also owned by Mr. Berger. Tr. at 507-510.
The landfill operated under permit 1979-1-OP. Comp. Exh. 4. The original permit
did not require financial assurance, although in 1985 and again in 1988 Mr. Berger posted
letters of credit in accord with the financial assurance regulations then in effect. Tr. at 77.
The groundwater monitoring provisions required quarterly sampling of two wells for five
constituents. Comp. Exh. 4. The annual cost of groundwater monitoring under the original
permit was $400 per year. Tr. at 584. Aside from a single administrative citation issued in
1988, which Mr. Berger paid, Tr. at 519, 521, there were no State enforcement actions prior
to the pending case, nor were any citizen complaints about the landfill received by either Mr.
Berger or the Illinois Environmental Protection Agency (Agency). Tr. 185, 507.
In the early 1990s, faced with tightening regulations on landfills, Mr. Berger began to
consider getting out of the landfill business. Tr. at 525. Terra Tech, Inc., an Indiana
corporation, expressed interest in purchasing the landfill. Tr. at 525-526. Terra Tech would
not, however, execute an option to purchase the landfill unless it was open. Tr. at 550. Mr.
Berger submitted a notice to the Agency stating that the landfill would remain open through
2000. Resp. Exh. 21. Although the notice to the Agency was submitted by Mr. Berger, it
was prepared by the president of Terra Tech, Mike Johnson, and submitted by Mr. Berger at
Terra Tech’s insistence. Tr. at 549-50. Similarly, Terra Tech submitted a permit application.
Tr. at 553. Based on this application, on March 20, 1992, the Agency issued supplemental
permit 1991-401-SP, which imposed heightened financial assurance and expanded groundwater
monitoring requirements on the landfill. Comp. Exh. 2. Financial assurance requirements
increased from $38,398 to $241,950.
Id.
Where before Mr. Berger had been required to
monitor two wells quarterly for five parameters, he was now required to monitor eight wells
for 14 parameters each quarter, and an additional 31 parameters annually.
Id.
This increase
in monitoring requirements increased Mr. Berger’s annual monitoring costs from
approximately $400 to approximately $15,000. Tr. at 584.
Terra Tech did obtain an option to buy the landfill from Mr. Berger, Resp. Exh. 23,
and Mr. Berger believed that Terra Tech was going to exercise its option. Tr. at 554-55.
Terra Tech had spent years working on the project, and as part of the consideration for its
option had paid half the cost of extensive engineering work and well construction. Tr. at 555,
617. Terra Tech continued working on plans to possibly purchase the landfill through late
1992 or 1993. Tr. at 557. The option, however, was never exercised, although Terra Tech
never informed Mr. Berger that it did not intend to purchase the landfill. Tr. at 559. Mr.
Berger continued to operate the landfill as he always had, but did not provide the added
financial assurance required by permit 1991-401-SP.
3
In 1992, when the requirements of permit 1991-401-SP became applicable, Mr. Berger
and his wife had a net worth of approximately $460,000, Tr. at 585, and income from Mr.
Berger’s business was approximately $40,000 or $41,000. Tr. at 597. Bruce Runyon,
president and CEO of Olney Trust Bank, testified that a person with a net worth of $449,200
and an average annual income of $41,697 would not qualify for a letter of credit in the amount
of $241,000. He testified that to issue such a letter of credit the bank would require monthly
income of approximately $10,000, nearly triple the average amount earned by Mr. Berger.
Tr. at 292-94. He further testified that no bank would issue a letter of credit based on this
income and asset position. Tr. at 295.
On June 24, 1993, the Agency conducted an inspection of the landfill, at which time
the inspector noted various operational violations. Comp. Exh. 5, Tr. at 563. The inspector
also cited Mr. Berger for failure to comply with the landfill’s financial assurance requirements.
Comp. Exh. 5. The Agency conducted additional inspections on April 18, 1994, and August
25, 1995, which provided the basis for most of the remaining violations alleged in the
complaint.
In July of 1993, Mr. Berger formed Berger Waste Management, Inc. (BWM), and he
and his wife transferred their interest in the property underlying the landfill to the corporation.
Tr. at 592-93. The Bergers also created a land trust, with Mr. Berger’s wife as the named
beneficiary, and transferred their residence, farm, and six rental houses to the trust. Tr. at
595. At the same time, Mr. Berger transferred his interest in their jointly owned car to his
wife.
Id.
The landfill stopped accepting waste in September of 1993. Tr. at 217, 560.
At the time of hearing, Mr. Berger’s sole asset of any value was his IRA, valued at
$80,000. Tr. at 593. The total value of Mr. Berger’s assets, plus the assets transferred to the
corporation or his wife or into the trust, was $358,000 at the time of the hearing. Tr. at 595-
596. From 1979 through 1990, Mr. Berger’s business income averaged approximately
$40,000 to $41,000. Tr. at 597. In 1991, 1992, and 1993 (prior to incorporation of BWM)
respectively, Mr. Berger’s business had net income of $26,610, $43,800 and $45,210. Tr. at
317-18, R51-53. After incorporation of BWM, the corporation had net losses of $1,800 and
$3,947 in 1993 and 1994 respectively, and had net income of $6,056, $636 and $3,284 in
1995, 1996 and 1997 respectively. Tr. at 319, R54-R58. The corporation sold its trash
hauling business at the end of 1997. The corporation received $50,000, and Mr. Berger
received $55,000 for a related agreement not to compete. Tr. at 231. Mr. Berger has not
been employed since the trash hauling business was sold. Tr. at 216, 597. Given his
background and the type of employment available in the area, he estimates that he could earn
$15,000 per year. Tr. at 598-601.
PROCEDURAL HISTORY
This case was commenced by complainant on December 7, 1994. After a period of
discovery, complainant filed an amended complaint on November 7, 1996, which the Board
accepted on December 5, 1996. The six-count amended complaint alleges violations based on
failure to post financial assurance (count I), failure to file an application for significant
modification of a permit (count II), failing to compact refuse, allowing litter, and failing to
4
apply cover (count III), depositing waste beyond the permitted boundaries of the landfill (count
IV), failing to monitor groundwater (count V), and failing to maintain adequate roads (count
VI).
More discovery followed. Significant to the matters before the Board today,
respondents propounded “Respondents’ Request to Admit” and “Respondents’ Second Set of
Interrogatories” to complainant on April 23, 1998. Complainant filed its “Answer to
Respondents’ Request to Admit” on May 18, 1998, and its “Answer to Second Set of
Interrogatories” on June 3, 1998. In its “Answer to Respondents’ Request to Admit,”
complainant objected to four of the five requests or, “without waiving the objection,” denied
any facts in the requests. Within their second set of interrogatories respondents sought
information in the event of a denial of the requests to admit; complainant responded to these
interrogatories that it had objected to the requests to admit.
Respondents filed a “Motion to Compel and for Expedited Ruling Directed to Hearing
Officer” on July 27, 1998, seeking, among other things, rulings on complainant’s objections to
the requests to admit. Per the hearing officer’s direction, complainant responded to the motion
on August 3, 1998, and on August 4, 1998, the hearing officer issued an order ruling on the
motion to compel. The hearing officer ruled that complainant’s responses to the requests to
admit would be treated as denials, and directed complainant to produce (and file with the
Board) any information responsive to respondents’ second set of interrogatories on or before
August 10, 1998. Complainant did not file any supplemental information. The hearing officer
noted in the August 4 order that should respondents prove at hearing any of the matters they
sought admitted in the requests to admit, they could seek appropriate relief from the Board.
A hearing was held in Olney, Illinois on August 18, 19, 20, and 21, 1998.
Complainant filed its “Hearing Brief” on October 16, 1998. “Respondents’ Hearing Brief”
was filed on November 9, 1998. In their hearing brief, respondents ask the Board to reverse
the hearing officer’s ruling on August 18 excluding evidence of respondents’ offers at
conferences held pursuant to former Section 31(d) of the Act, 415 ILCS 5/31(d) (1994).
1
See
Tr. at 65-67; Resp. Br. at 36-39. Complainant filed a “Reply Brief” on November 24, 1998.
On November 25, 1998, respondents filed “Respondents’ Motion for Sanctions,”
arguing that they had proven matters sought admitted in “Respondents’ Requests to Admit,”
and seeking relief in accordance with the hearing officer’s August 4 order. On December 7,
1998, complainant filed a “Motion for Extension of Time to Answer.” On December 15,
1998, before the Board could rule on complainant’s motion, complainant filed a “Motion for
Leave to File,” seeking leave to file
instanter
complainant’s “Response to Motion for
Sanctions,” which was appended to the “Motion for Leave to File.” The Board grants the
“Motion for Leave to File,” and accepts complainant’s “Response to Motion for Sanctions.”
This action renders complainant’s “Motion for Extension of Time to Answer” moot.
1
Former Section 31(d) required the Agency to provide a party complained against “an
opportunity to meet appropriate agency personnel in an effort to resolve such conflicts which
could lead to the filing of a formal complaint.” The Agency was required to provide this
opportunity before a written complaint could be served. 415 ILCS 5/31(d) (1994).
5
EVIDENTIARY RULING
At the hearing on August 18, 1998, respondents’ counsel attempted to introduce
evidence of the settlement offers respondents had made at the Section 31(d) conferences prior
to the litigation. His purpose was to demonstrate that respondents had been diligent in
attempting to comply with or secure relief from the Act and regulations. Diligence is a factor
the Board may consider under Section 42(h)(2) of the Act in determining an appropriate
penalty. 415 ILCS 5/42(h)(2) (1996). The hearing officer upheld complainant’s objection to
this evidence, and denied respondents’ request to make an offer of proof. Tr. at 65-67, 233-
37.
Respondents argue that their evidence should have been admitted. Respondents base
their argument on a passage from Cleary & Graham’s Handbook of Illinois Evidence. Cleary
& Graham state:
Neither an offer to compromise a disputed liability claim of the
opposing party nor an actual completed compromise is admissible
as an admission of liability. The reasons assigned for the
exclusion are (1) irrelevancy, since the offer or compromise in
reality involves a purchase of peace rather than an admission of
liability, and (2) policy in that compromises, favored by public
policy, would be discouraged by admitting the evidence.
Liability must be disputed. Negotiations to determine and settle
the amount to be paid under an admitted liability do not fall
within the rule of exclusion. Cleary & Graham’s Handbook of
Illinois Evidence § 408.1 (4th ed. 1984) (citations omitted).
The Board agrees with respondents that where liability has been admitted (or otherwise
determined) settlement discussions which are relevant may be admitted. Smothers v. Cosgove-
Meehan Coal Co., 264 Ill. App. 488, 492 (4th Dist. 1932); Smiley v. Manchester Ins. &
Indem. Co., 49 Ill. App. 3d 675, 681, 364 N.E.2d 683, 688 (2nd Dist. 1977),
aff’d
71 Ill. 2d
306, 375 N.E.2d 118 (1978); Shimkus v. Board of Review of Ill. Dept. of Labor, 117 Ill.
App. 3d 826, 831, 454 N.E.2d 36, 39 n.2 (1st Dist. 1983). In this case, however, the Board
cannot find that the discussions respondents seek to have admitted would be relevant.
Section 42(h)(2) of the Act specifically authorizes the Board to consider the presence or
absence of diligence on the part of a respondent to either comply with the Act or regulations or
secure relief from the requirements of the Act or regulations. Respondents have never claimed
that they have come into compliance with respect to any of what they call the “big ticket
items” in this case.
Resp. Br. at 38.
Rather, respondents seek to introduce offers at former
Section 31(d) meetings on the basis that such offers constitute attempts to secure relief from
the requirements of the Act or regulations. The Board rejects this interpretation of Section
42(h)(2). A party can secure relief from requirements by obtaining a variance, an adjusted
standard, or a site-specific rule from the Board. These mechanisms impact the applicability of
6
rules or statutes to the recipient. A settlement offer, on the other hand, has no impact on the
application of a rule or statute; it is merely an attempt to influence the State’s exercise of
prosecutorial discretion. Acceptance of a settlement offer does not bring a party into
compliance. Indeed, a party settling with the state receives no shield against an enforcement
action brought by any other person. See 415 ILCS 5/31(d) (1996).
2
Since respondents’ settlement offers were not attempts to secure relief from the
requirements of the Act or regulations, they are not relevant to the Board’s inquiry under
Section 42(h)(2). Respondents have not articulated any other basis for admission of the
settlement offers, and we see none. Because the settlement offers are not relevant to any issue
before the Board, they were properly excluded at the hearing, and the hearing officer’s ruling
is affirmed.
LIABILITY DETERMINATIONS
Section 31(e)
As an initial matter, respondents argue that compliance with the regulations identified
in several counts would impose an arbitrary and unreasonable hardship on respondents, and
consequently, based on Section 31(e) of the Act (415 ILCS 5/31(e) (1996)), no violation
should be found. Section 31(e) provides:
In hearings before the Board under this Title the burden shall be
on the . . . complainant to show . . . that the respondent has
violated . . . any rule or regulation or the Board or permit or
term or condition thereof. If such proof has been made, the
burden shall be on the respondent to show that compliance with
the Board’s regulations would impose an arbitrary or
unreasonable hardship.
Respondents base their argument on the last sentence of this subsection.
The Board need not rule on whether the last sentence of Section 31(e) creates a defense
to liability, as respondents argue, or merely allocates the burden of production on an issue
relevant to mitigation of any penalty. Even if respondents are correct, the Board cannot find
that the hardship faced by respondents in this case is in any way arbitrary. Respondents’
current predicament is the result of decisions made by respondents, and those decisions had
clearly discernible effects under the landfill regulations. Thus, the hardship faced by
respondents is self-imposed, and cannot be considered arbitrary. See City of Salem v. IEPA
(July 8, 1998), PCB 98-1, slip op. at 4. Any defense to liability arguably provided by Section
31(e) is therefore unavailable to respondents.
Count I
2
Current Section 31(d) of the Act was formerly Section 31(b), and as such was in effect at the
same time as former Section 31(d). See 415 ILCS 5/31(b) (1994).
7
Allegations
In count I of the complaint complainant alleges that respondents owned and operated a
landfill in Richland County under two permits issued by the Agency, operating permit 1979-1-
OP and supplemental permit 1991-401-SP. Supplemental permit 1991-401-SP, issued on
March 20, 1992, includes the following provisions:
6.
Financial assurance shall be maintained by the operator in
accordance with 35 Ill. Adm. Code, Subtitle G, Part 807,
Subpart F in an amount equal to the current cost estimate
for closure and post-closure care. The current cost
estimate is $241,950. Revised financial assurance for this
amount shall be provided to the Agency by July 2, 1992.
7.
The operator shall file revised cost estimates for closure
and post-closure at least every two years in accordance
with 35 Ill. Adm. Code, Subpart G, Part 807, Subpart F.
The first revised cost estimates are due on or before
December 12, 1992. Pet. Exh. 2 at 2-3.
Complainant alleges that respondents did not maintain financial assurance in an amount
equal to the current cost estimate and did not submit revised cost estimates as required.
Complainant alleges that these omissions constitute violations of Sections 21(d)(1), 21(d)(2)
and 21.1(a) of the Act (415 ILCS 5/21(d)(1), 21(d)(2), 21.1.(a) (1996)), and 35 Ill. Adm.
Code 807.302, 807.601, 807.603(a), 807.603(b)(1), and 807.623(a). Section 21(d)(1)
provides, with qualifications not relevant here, that no person may conduct a waste-disposal
operation in violation of any condition imposed by a permit granted by the Agency. Section
21(d)(2) provides that no person may conduct a waste disposal operation in violation of any
regulations adopted by the Board. Section 21.1(a) provides:
a)
Except as provided in subsection (a.5) no person other
than the State of Illinois, its agencies and institutions, or a
unit of local government shall conduct any waste disposal
operation on or after March 1, 1985, which requires a
permit under subsection (d) of Section 21 of this Act,
unless such person has posted with the Agency a
performance bond or other security for post-closure care
in accordance with this Act and regulations adopted
thereunder.
Section 807.302 provides:
All conditions and provisions of each permit shall be complied
with.
Section 807.601 provides in relevant part:
8
No person shall conduct a waste disposal operation . . . which
requires a permit under Section 21(d) of the Act unless such
person has provided financial assurance in accordance with [35
Ill. Adm. Code 807.Subpart F].
Section 807.603 provides in relevant part:
a)
The operator must maintain financial assurance equal to or
greater than the current cost estimate at all times except as
provided in this Section.
b)
The operator must increase the total amount of financial
assurance so as to equal the current cost estimate within
90 days after any of the following:
1)
An increase in the current cost estimate[.]
Section 807.623(a) provides:
a)
The operator must revise the current cost estimate at least
once every two years. The revised current cost estimate
must be filed on or before the second anniversary of the
filing or last revision of the current cost estimate.
Complainant alleges that the violations are ongoing.
Facts
Beginning in 1979, Wayne Berger operated a landfill in Richland County, Illinois. Tr.
at 216-17. The landfill operated under operating permit 1979-1-OP and supplemental permit
1991-401-SP from March 29, 1979, through September 18 or 20, 1993, when it stopped
receiving waste. Comp. Exh. 2, 4, Tr. at 217. (Although the landfill no longer accepts
waste, the Agency has not certified it closed, so from a regulatory standpoint it is still
operating and the financial assurance requirements are still in effect.) Mr. Berger owned the
landfill until July of 1993, when title was transferred to Berger Waste Management, Inc. Tr.
at 592-593.
Supplemental permit 1991-401-SP, quoted above, requires the operator of the landfill
to provide financial assurance for closure and post-closure care. Respondents admit that they
have not provided financial assurance in the amount of $241,950 or submitted updated cost
estimates. Resp. Br. at 20-21; Tr. at 218-19. In 1988, respondent Wayne Berger provided a
letter of credit in the amount of $38,398 for financial assurance, but that amount was not
increased as required by supplemental permit 1991-401-SP, and the letter of credit expired on
October 31, 1993. Tr. at 259-60; Res. Exh. 18.
Analysis
9
Respondents do not dispute that the violations alleged in count I occurred. There is an
issue, however, as to whether both respondents are liable for the violations.
With the exception of Section 807.302, all the regulations and statutes at issue under
count I either specifically apply to operators, or prohibit persons from “conduct[ing] a waste
disposal operation” unless certain actions are taken. (Section 807.302 applies to a permit
holder.) An “operator” is defined in 35 Ill. Adm. Code 807.104 as “[a] person who conducts
a . . . waste disposal operation.” It is clear from the record that the waste disposal operations
at issue in this case were conducted by Wayne Berger. Tr. at 217. Significantly, all permits
for the landfill were issued to Wayne Berger. Comp. Exh. 2, 4. Apparently, the permits
were never transferred to BWM. Comp. Br. at 14. Mr. Berger testified that he was the only
person responsible for operation and maintenance of the landfill, and that he has always been
in charge of the landfill. Tr. at 217. The Board therefore finds that Mr. Berger was the
operator of the landfill, and BWM did not become the operator when it received title to the
property. Consequently, BWM’s involvement is only as an owner. Therefore BWM is not
liable for the violations alleged in count I.
Complainant argues that BWM is the alter ego of Wayne Berger and thus both
respondents should be found jointly liable for all violations. Reply at 7-8. In order to pierce
the corporate veil under an alter ego theory, however, unity of identity between a corporation
and its owner is not enough; recognizing the separate corporate identity must also sanction a
fraud or promote injustice.
In re
Rehabilitation of Centaur Ins. Co., 158 Ill. 2d 166, 172-73,
632 N.E.2d 1015, 1017-18 (1994). Complainant has not demonstrated that this second
requirement is met. There is no allegation of actual fraud in this case. Complainant argues,
however, that “BWM is a corporation which was formed solely for the purpose of avoiding
liability in this enforcement action.” Reply at 7. If this was Mr. Berger’s purpose, he did not
achieve it: the Board has found him, rather than BWM, liable for the violations that occurred.
Complainant may be basing its argument on the fact that the existence of the corporate entity
places a barrier between Complainant and certain assets that might otherwise be available to
satisfy a judgment. The mere prospect of an unsatisfied judgment, however, cannot satisfy the
“promote injustice” prong of the test. See Sea-Land Services, Inc. v. The Pepper Source, 941
F.2d 519, 522-23 (7th Cir. 1991) (applying Illinois law). Absent some other showing of
injustice resulting from the separate corporate existence of BWM, we will not pierce the
corporate veil and hold BWM responsible for Mr. Berger’s violations of the Act and
regulations.
3
Conclusion
3
To the extent Complainant is concerned with the availability of assets of BWM to satisfy any
judgment it may obtain, the Board notes that Mr. Berger’s stock in BWM is among his assets,
upon which Complainant could levy to satisfy a judgment. The Board further notes that if Mr.
Berger’s transfer of property to BWM upon its formation was improper, Complainant has a
remedy through statutes allowing avoidance of fraudulent transfers, see,
e.g.
, 740 ILCS 160
(1996).
10
The Board finds that Wayne Berger committed each of the violations alleged in count I
of the complaint. The Board further finds that Berger Waste Management, Inc., is not liable
for any of the violations alleged in count I. The violation of Section 807.623(a) continued
from December 12, 1992, through August 21, 1998. The other violations continued from
July 2, 1992, through August 21, 1998.
Count II
Allegations
Complainant alleges that on October 29, 1992, the Agency sent Mr. Berger a letter
acknowledging receipt of notification from Berger that the landfill would operate beyond
September 18, 1992. In accordance with 35 Ill. Adm. Code 814.104, the letter required Mr.
Berger to file an application for significant modification of the operating permit by March 1,
1993. Complainant alleges that the Agency has not received a significant modification
application, and respondents have consequently violated Section 21(d)(2) of the Act and
Section 814.104. Section 21(d)(2) is discussed above. Section 814.104 provides:
a)
All owners or operators of landfills permitted pursuant to
[Section 21(d)] shall file an application for a significant
modification to their permits for existing units, unless the
units will be closed pursuant to Subpart E within two
years of the effective date of this Part.
***
c)
The application shall be filed within 48 months of the
effective date of this Part, or at such earlier time as the
Agency shall specify in writing pursuant to 35 Ill. Adm.
Code 807.209 or 813.201(b).
Facts
On or about March 15, 1991, Mr. Berger sent the Agency a notification form stating
that the Berger landfill would remain open beyond September 18, 1992. Res. Exh. 21. On or
about October 29, 1992, the Agency sent Mr. Berger a letter acknowledging receipt of this
notification and requiring that an application for significant modification of the operating
permit be filed by March 1, 1993, in accordance with 35 Ill. Adm. Code 814.104. Comp.
Exh. 3. Respondents admit that they have not submitted the application. Resp. Br. at 20-21;
Tr. at 219-20.
11
Analysis
The alleged violations, as noted, are admitted. We turn then to whether BWM can be
held liable for these violations. Section 814.104(a) places responsibility for submitting a
significant modification application on the owner or the operator, but 35 Ill. Adm. Code
813.201, which governs initiation of significant modification to a permit, provides only for the
operator (813.201(a)) or the Agency (813.201(b)) to initiate a significant modification to a
permit. Under the definition of “owner” in 35 Ill. Adm. Code 807.104 and 810.103,
however, the owner is considered the operator if there is no other person conducting an
operation at a site. In such a circumstance the owner could initiate a modification under
Section 813.201. In this case, however, there is an operator: Mr. Berger. BWM is not
therefore deemed an operator under Section 810.103, and cannot initiate the permit
modification.
4
The Board therefore concludes that only the operator, Mr. Berger, is to be held
liable for these violations.
Conclusion
The Board finds that Wayne Berger has violated Section 21(d)(2) of the Act and 35 Ill.
Adm. Code 814.104 by failing to submit a significant modification permit as required by the
Agency. The Board further finds that Berger Waste Management, Inc., is not liable for the
violations alleged in count II. The violations continued from March 1, 1993, to August 21,
1998.
Count III
Allegations
Complainant alleges that on June 24, 1993, the Agency conducted an inspection of the
landfill. Complainant alleges that on that date, respondents caused or allowed refuse to be
deposited in two areas of the landfill which had not received at least six inches of daily cover.
Complainant also alleges that on that date, respondents allowed litter to be blown along a fence
at the northern boundary of the landfill. Complainant further alleges that on that date
respondents allowed refuse to be deposited in the landfill which had not been compacted.
Complainant alleges that by failing to place adequate daily cover respondents have violated
Sections 21(d)(2) and 21(o)(5) of the Act. Complainant alleges that by failing to collect and
contain litter from the landfill site at the end of each working day, respondents have violated
Sections 21(d)(2) and 21(o)(12) of the Act and 35 Ill. Adm. Code 807.306. Finally,
complainant alleges that by failing to compact refuse deposited in the landfill respondents have
violated Section 21(d)(2) of the Act and 35 Ill. Adm. Code 807.303(b).
4
This interpretation is consistent with the understanding of the interrelationship between
“owners” and “operators” expressed by the Board in the rulemaking in which the term
“owner” was added at Section 814.104. See In the Matter of: RCRA Subtitle D
Amendments (May 27, 1993), R93-10, slip op. at 11; In the Matter of: RCRA Subtitle D
Amendments (September 15, 1993), R93-10, slip op. at 23.
12
Section 21(d)(2) is discussed above. The relevant provisions of Section 21(o) provide:
No person shall:
o.
Conduct a sanitary landfill operation which is required to
have a permit under subsection (d) of this Section, in a
manner which results in any of the following conditions:
* * *
5.
uncovered refuse remaining from any previous
operating day or at the conclusion of any operating
day, unless authorized by permit;
* * *
12.
Failure to collect and contain litter from the site by
the end of each operating day[.]
Section 807.303(b) provides:
Unless otherwise specifically provided by permit, the following
methods of operation shall be followed:
***
b)
Spreading and compacting - as rapidly as refuse is
deposited at the toe of the fill, all refuse shall be spread
and compacted in layers within the cell, such layers not to
exceed a depth of two feet.
Section 807.305(a) provides:
Unless otherwise specifically provided by permit, the following
cover requirements shall be followed:
a)
Daily Cover - a compacted layer of at least 6 inches of
suitable material shall be placed on all exposed refuse at
the end of each day of operation.
Section 807.306 provides:
All litter shall be collected from the sanitary landfill site by the
end of each working day and either placed in the fill and
compacted and covered that day, or stored in a covered
container.
Complainant alleges that the violations are ongoing.
Facts
Daily Cover. Complainant’s Exhibit 5, an Agency inspection report, indicates that on
June 24, 1993, Agency inspectors conducted an inspection of the Berger landfill, and that an
13
area of the landfill “was observed as having exposed refuse. Work was not being conducted in
Area A on the day of the inspection.” Mr. Berger admits that he had uncovered or
insufficiently covered refuse at the end of an operating day. Tr. at 220-21. There is no
evidence of uncovered or insufficiently covered refuse on any day other than the date of the
inspection reported in Complainant’s Exhibit 5. Reports from subsequent inspections do not
indicate uncovered or insufficiently covered refuse. See Comp. Exh. 6, 7.
Litter. Complainant’s Exhibit 5 indicates that “[b]lown and weathered litter was
observed along the fence north of Area A.” Inspector Sheila Williams, who signed the
inspection report, further testified that photo 5, appended to the inspection report, showed the
litter in question, and that she did not remember any other litter at the landfill on that date.
Tr. at 146-47. Mr. Berger admitted that there was litter at the landfill on that date. Tr. at
566. Although Mr. Berger testified that he constructed fences to catch litter blown by wind
during operations, and he personally picked up litter that blew off the landfill site, Tr. at 511-
12, Mr. Berger admitted that there was “a little” litter at the landfill at the end of an operating
day. Tr. at 220.
Compacting. Complainant’s Exhibit 5 indicates that “[r]efuse in Area A was observed
as not having been compacted. Non-crushed boxes and fully expanded plastic jugs were
observed in Area A.” See also photo 2 in Complainant’s Exhibit 5. Ms. Williams testified
that there was uncompacted refuse in an area not receiving waste on the date of the inspection,
Tr. at 102, and that the area of uncompacted refuse was approximately 30 feet by 60 feet. Tr.
at 143.
Analysis
Daily Cover. Mr. Berger admitted the presence of uncovered or inadequately covered
waste at the end of an operating day. This condition constituted a violation of Section 21(o)(5)
of the Act and 35 Ill. Adm. Code 807.305(a). There is no evidence, however, from which the
Board can find that this condition existed on any date other than the date of the inspection,
June 24, 1993. BWM had not yet been incorporated on June 24, 1993. The Board
accordingly concludes that Wayne Berger committed the violations in question.
Litter. As noted, Mr. Berger has admitted that there was litter present at the end of an
operating day, which constitutes violations of Section 21(o)(12) of the Act and 35 Ill. Adm.
Code 807.306. Respondents’ arguments regarding the small amount of litter involved may
bear on an appropriate penalty, but do not impact whether Section 21(o)(12) or Section
807.306 have been violated. There is no evidence in the record that litter violations occurred
more than once; the Board can therefore find no ongoing violation of either provision. Since
BWM did not exist when the violations occurred, the Board concludes that only Wayne
Berger, and not BWM, committed these violations.
Compacting. Based on the testimony of Ms. Williams and the photographs included in
Complainant’s Exhibit 5, the Board finds that Mr. Berger did not compact refuse as rapidly as
it was deposited in the landfill. This failure constitutes a violation of 35 Ill. Adm. Code
807.303(b). There is no evidence from which the Board can determine the duration of this
14
violation. Because the violation occurred prior to the incorporation of BWM, only Mr. Berger
can be held responsible for the violation.
Conclusion
The Board finds that on or about June 24, 1993, Wayne Berger violated Section
21(o)(5) of the Act and 35 Ill. Adm. Code 807.305(a) by failing to cover refuse at the end of
an operating day with a compacted layer of at least six inches of suitable material. The Board
also finds that on or about June 24, 1993, Wayne Berger violated Section 21(o)(12) of the Act
and 35 Ill. Adm. Code 807.306 by failing to collect and contain litter at the site by the end of
an operating day. The Board also finds that as of June 24, 1993, Wayne Berger violated 35
Ill. Adm. Code 807.303(b) by failing to compact refuse as rapidly as it was placed in the
landfill. By violating Sections 807.303(b), 807.305(a), and 807.306, Wayne Berger has also
committed three violations of Section 21(d)(2) of the Act. None of these are continuing
violations.
Count IV
Allegations
Complainant alleges that on April 18, 1994, the Agency conducted an inspection at the
landfill and that on that date respondents caused or allowed refuse to be deposited in an area
which extended approximately seventy feet beyond the permitted boundary of the landfill.
Complainant alleges that respondents have thereby violated Sections 21(d)(1) and 21(o)(9) of
the Act. Section 21(d)(1) is discussed above. Section 21(o)(9) provides:
No person shall:
* * *
o.
Conduct a sanitary landfill operation which is required to
have a permit under subsection (d) of this Section, in a
manner which results in any of the following conditions:
* * *
9.
deposition of refuse in any unpermitted portion of
the landfill[.]
Facts
Complainant’s Exhibit 6 indicates that on April 18, 1994, Agency inspector Sheila
Williams conducted an inspection of the Berger landfill and noted:
The only apparent violation observed . . . was that the landfill
has gone beyond the permitted boundary on the southwest region.
The Soils and Hydrogeologic Investigation and Recommended
Goundwater Monitoring System report prepared by Shaffer,
Drimmel, Silver & Associates, Inc. includes a map designating
the permitted waste boundary as being directly west of, but no
further south than Monitoring Well G107. However, during the
15
inspection, the boundary of the landfill in this area was estimated
to continue approximately 70 ft. south of Monitoring Well G107.
There are two maps included in Complainant’s Exhibit 6. The first is a copy of a map
prepared by Shaffer, Drimmel, Silver & Associates, Inc. and submitted to the Agency by Mr.
Berger. The second map, copied from a map in the Agency’s files, is of unknown origin, Tr.
at 157-58, and marked with a written notation “Not to Scale.” The second map includes
designation of landfill cells.
The Board notes that although the second map has a handwritten notation “Not to
Scale” on it, a comparison with the first map shows that the boundaries of the landfill are
consistent. Mr. Berger testified that the second map accurately depicted the layout of the cells
of the landfill. Tr. at 515. Furthermore the map does include indications of scale: there are
several circles on the map indicated as having radii of 50 feet. Respondents have suggested
that the “Not to Scale” notation refers to the markings made on the map by the inspector and
not to the map itself. The Board finds this interpretation credible.
From east to west, the southern boundary of the landfill runs straight parallel to the
property line of the landfill for approximately (perhaps slightly less than) half its breadth, then
follows a meandering course north-northwest to a point approximately halfway to the landfill’s
northern boundary. From that point, the southern boundary again proceeds straight west for a
short distance before turning back south for another short distance. The boundary line then
resumes a meandering course north and west again to the western edge of the facility. In
broad terms, the effect of this course is an irregular notch being taken out of the southwest
corner of the otherwise-rectangular landfill.
Monitoring well G107 is marked on both maps inside this notch. It is shown
surrounded by the landfill on three sides, and is located just to the east of the point where the
boundary of the landfill turns back to the north and west. The second map indicates that
landfill cells 79D, 80D, and 83D are immediately west of the well. Landfill cell 88D, on the
other hand, is located three cells farther to the west, near the western edge of the landfill. At
the hearing, Ms. Williams marked an area on the first map where she believed waste had been
deposited beyond the permitted area. Tr. at 109. On the second map, the area she indicated is
immediately south of cells 79D, 80D, and 83D; it would be part of those cells if they were
extended to the south. Comp. Exh. 6.
Ms. Williams testified that she did not survey to determine whether monitoring well
G107 was actually located where indicated on the first map. Tr. at 159-60. She stated that the
well could be located further north or south than its position on the map. Tr. at 153. She
assumed that the well was located accurately because the first map was submitted by Mr.
Berger. Tr. at 159.
Harry Chappel, respondents’ expert witness, testified that based on his observations in
the field the boundary of the permitted area of the landfill coincided with the tree line of a
wooded area to the south of the landfill. Tr. at 377. He determined this based on the
topographic lines on the second map. Tr. at 394. He testified that based on his observations
16
the actual location of monitoring well G107 was east of cell 88D and approximately 206 feet
north of the tree line. Tr. at 379.
Mr. Berger testified that he has never deposited any waste in cells 79D, 80D, or 83D,
or anywhere south of those cells, Tr. at 573, and the area that Ms. Williams thought was in
those cells must have been in cell 88D. Tr. at 565. Ms. Williams testified that she estimated
which cells were involved based on the location of monitoring well G107. Tr. at 139.
Analysis
Complainant’s case for waste having been deposited beyond the permitted boundaries
of the landfill is predicated on the assumption that monitoring well G107 marks the boundary
of the landfill. Given the contradictory evidence on the subject, the Board cannot determine
from this record where monitoring well G107 is located relative to the boundary. Absent any
other evidence establishing the landfill boundary and the deposit of waste outside that
boundary, the Board concludes that there is insufficient evidence to support a finding of
violations.
Conclusion
The Board finds no violations of Sections 21(d)(1) or 21(o)(9) of the Act based on
waste disposed beyond the permitted landfill boundaries.
Count V
Allegations
Complainant alleges that supplemental permit 1991-401-SP imposed a groundwater
monitoring program on the landfill, which required monitoring reports be submitted to the
Agency, and that since at least January 15, 1995, respondents have failed to submit the
required reports. Complainant alleges that this failure is a violation of supplemental permit
1991-401-SP, and consequently respondents have violated Sections 21(d) and 21(o) of the Act.
Section 21(d)(1) is quoted above. Section 21(o) provides in relevant part:
No person shall:
* * *
o.
Conduct a sanitary landfill operation which is required to
have a permit under subsection (d) of this Section, in a
manner which results in any of the following conditions:
* * *
11.
failure to submit reports required by permits or
Board regulations.
Complainant alleges that these violations are ongoing.
Facts
17
Supplemental permit 1991-401-SP requires Wayne Berger to monitor groundwater in
the vicinity of the landfill for an array of potential contaminants and submit groundwater
monitoring reports to the Agency each quarter, on the fifteenth of January, April, July, and
October. Comp. Exh. 2, Attachment A at 3. Respondents admit that they have not submitted
groundwater monitoring reports since September of 1994. Res. Br. at 20-21; Tr. at 223.
Analysis
As noted, the violations are admitted. Because these violations are predicated on a
permit condition, only the permit holder can be held liable. BWM is therefore not liable for
these violations. It is not clear whether the report submitted in September 1994 was the third
quarter report submitted late or the fourth quarter report submitted early; in light of the
allegation that respondents have been out of compliance since at least January 15, 1995,
Comp. at 13, we will assume the latter, and find that these violations continued from January
15, 1995, through the hearings.
Conclusion
The Board finds that Mr. Berger has violated Sections 21(d)(1) and 21(o)(11) of the
Act by failing to submit groundwater monitoring reports to the Agency as required by
supplemental permit 1991-401-SP. The Board further finds that Berger Waste Management,
Inc., is not liable for the violations alleged in count V. The violations continued from January
15, 1995, through August 21, 1998.
Count VI
Allegations
Complainant alleges that on August 25, 1995, the Agency conducted an inspection of
the landfill, and that respondents had allowed thick vegetation to grow over the landfill road,
making the landfill inaccessible on that date. Complainant alleges that by causing or allowing
the road to become inaccessible, respondents have violated Section 21(d)(2) of the Act and 35
Ill. Adm. Code 807.314(b). Section 21(d)(2) is discussed above. Section 807.314(b)
provides:
Except as otherwise authorized in writing by the Agency, no
person shall cause or allow the development or operation of a
sanitary landfill which does not provide:
***
b)
Roads adequate to allow orderly operations within the
site[.]
Facts
Complainant’s Exhibit 7, an Agency inspection report, indicates that on August 25,
1995, Agency inspector Sheila Williams inspected the Berger landfill and noted that while the
landfill road was blocked by a truck, “[u]pon a closer look at the landfill road, it was apparent
18
that the State vehicle could not have been driven on the road even if it had been accessible.
This was due to the height of the vegetation that was especially thick down the center of the
road.” Photos 4 and 5 attached to the inspection report show the road with grass grown up
over it.
Ms. Williams testified that she was unable to drive her vehicle, a 1995 Chevrolet
Caprice station wagon, on the roads of the landfill due to problems with vegetation, but also
testified that she never tried to drive down the road. Tr. at 110, 114, 177, 179. She testified
that she was afraid that driving down the road would damage her vehicle. Tr. at 195. The
problematic vegetation consisted of grass and weeds. Tr. at 179. The grass in some places
was as high as four feet tall. Tr. at 180-81.
Mr. Berger, on the other hand, testified that on or about August 25, 1995, he drove his
pickup truck down the road with no problems. Tr. at 576.
The landfill was not accepting waste at the time of the August 25 inspection. Final
cover had been applied (although not certified by the Agency) and vegetated. Tr. at 562.
Analysis
The Board concludes that the evidence is insufficient for it to find that the road was in
fact inadequate. Given Ms. Williams’ testimony that she did not try to drive down the road
and Mr. Berger’s testimony that he was able to drive down the road on or about the same day,
the Board concludes that the State has not provided a preponderance of evidence that the road
was inadequate. We are not ruling that an inspector must attempt to drive down an impassable
road, and risk his or her vehicle, in order to establish a violation of Section 807.314(b). We
believe, however, that proving the inadequacy of a road requires more than a visual inspection
from a distance, which is all we have in this case.
Respondents have argued that “orderly operations,” as that term is used in Section
807.314(b), do not include Agency inspections. The Agency disputes this interpretation. The
Board is not reaching that issue because we find the evidence inconclusive in any event.
Conclusion
The Board finds no violation of Section 21(d)(2) of the Act or 35 Ill. Adm. Code
807.314(b) based on failure to maintain roads adequate to allow orderly operations within a
site.
REMEDY
In crafting appropriate remedies, the Board considers the factors set forth in Section
33(c) of the Act (415 ILCS 5/33(c) (1996). Section 33(c) provides:
c.
In making its orders and determinations, the Board shall
take into consideration all the facts and circumstances
bearing upon the reasonableness of the emissions,
19
discharges, or deposits involved including, but not limited
to:
i.
the character and degree of injury to, or
interference with the protection of the health,
general welfare and physical property of the
people;
ii.
the social and economic value of the pollution
source;
iii.
the suitability or unsuitability of the pollution
source to the area in which it is located, including
the question of priority of location in the area
involved;
iv.
the technical practicability and economic
reasonableness of reducing or eliminating the
emissions, discharges or deposits resulting from
such pollution source; and
v.
any subsequent compliance.
Where the Board determines that a monetary penalty is appropriate, Section 42(h) of
the Act authorizes the Board to consider any matters of record in mitigation or aggravation of
penalty. Section 42(h) specifically lists several items the Board may consider, but the list is
not exclusive.
Section 33(c) Analysis
Section 33(c) by its terms applies to violations involving “emissions, discharges, or
deposits[.]” In such cases, consideration of the Section 33(c) factors is mandatory. Only
some of the violations found in this case fall into this category. Often, however, the Board
finds it useful to consider Section 33(c) factors in connection with violations that do not
specifically involve emissions, discharges or deposits, and has done so here.
Considering the Section 33(c) factors as they relate to the violations found above, the
Board finds as follows:
Character and Degree of Injury
Count I. Mr. Berger’s failure to provide the financial assurances required by permit
1991-401-SP results in a significant degree of interference with the protection of health,
welfare, and property. Although the financial assurance violations may not be the most
dramatic possible violations of the Act, they are among the most insidious in character: Mr.
Berger violates the provisions which are in place to ensure that other more threatening
violations do not occur, and which provide a safety net to protect the environment if the
20
operator cannot or will not meet his obligations under the law. The Board thus takes these
violations very seriously. The Board concludes that this factor weighs in aggravation of the
violations.
Count II. Failure to file a significant modification application also results in a
significant degree of interference with protection of health, welfare, and property. Filing of
the significant modification application begins an evaluation process under Part 814. Based at
least partly on the information submitted in the significant modification application, the
Agency determines whether a particular landfill is entitled to remain open under Subparts C or
D of Part 814, or must close under Subpart E. See 35 Ill. Adm. Code 814.301(b),
814.401(b). Until the Agency completes its evaluation of a petitioner’s significant
modification application, it is not clear under which subpart the facility will be regulated.
Land & Lakes Co. v. IEPA (August 8, 1998), PCB 97-209, slip op. at 4. Closure of landfills
which do not meet the heightened requirements of Subpart C or D, or the imposition of those
requirements on landfills which will remain open, reduces the threat of injury to health,
welfare or property, but participants must meet their responsibilities under the rules, including
timely filing of a significant modification application, for the regulatory framework to achieve
its goals. Mr. Berger’s failure to file his application on time derailed this process with respect
to his landfill. The Board therefore concludes that this factor weighs in aggravation of the
violations.
Count III. There is no evidence of any significant injury to or interference with the
protection of health, welfare, or property resulting from any of the operational violations
found under count III. The Board finds that this factor weighs in mitigation of these
violations.
Count V. The Board finds that Mr. Berger’s failure to perform the groundwater
monitoring required under permit 1991-401-SP resulted in a significant degree of interference
with the protection of health, welfare, and property. While the violations under count V are
not of a type that will necessarily result in direct harm to the environment, they are, like the
financial assurance violations discussed under count I, particularly insidious, because they
hinder enforcement of other statutes and regulations which do involve direct impact on the
environment. Groundwater monitoring ensures that pollution or a threat of pollution can be
discovered early on, and any harm prevented or minimized. When this data is not collected,
the entire regime of groundwater regulation is undermined. The Board accordingly finds that
this factor weighs in aggravation of these violations.
Social and Economic Value
For part of the duration of some violations, the Berger landfill was operating and
provided a valuable service to surrounding towns. Since late 1993, however, the landfill has
not accepted waste. The Board finds that this factor weighs neither in aggravation nor
mitigation of the violations.
Suitability of Pollution Source
21
The Berger landfill has been permitted as a landfill since 1979. The Board therefore
finds that it is suitable to its location. The Board finds that this factor weighs in mitigation of
these violations.
Technical Practicability and Economic Reasonableness of Compliance
Count I and V. Mr. Berger’s financial assurance and groundwater monitoring
requirements were set in permit 1991-401-SP. If Mr. Berger believed that the permit
conditions were inappropriate, he had recourse through the Board’s permit appeal procedures.
The Board will not review the reasonableness of the terms of permit 1991-401-SP in this case.
Accordingly the Board concludes that this factor weighs in aggravation of the violations.
Count II. Respondents assert that compliance with the requirement to file an
application for significant modification is not economically reasonable. The evidence indicates
that compliance,
i.e.
, preparation and filing of an application for a significant permit
modification, would cost between $27,000 and $30,000.
5
The Board finds that an expenditure
in this amount is not unreasonable. Respondents, in their arguments, lump this expenditure
with other expenditures that the modified permit would presumably require, such as costs for
additional cover or groundwater monitoring. These, however, are separate inquiries. The
Board concludes that this factor weighs in aggravation of the violations.
Count III. There is insufficient evidence for the Board to make a finding on this factor.
Mr. Berger has blamed wet weather for the conditions which resulted in at least some of the
violations under count III. Tr. at 569-70. Complainant has disputed this claim. Reply at 3.
We cannot tell on this record whether it would have been technically practicable for Mr.
Berger to undertake the activities necessary for compliance if it was in fact raining on the day
or days prior to Ms. Williams’ inspection. The Board therefore finds that this factor weighs
neither in aggravation nor mitigation of these violations.
Subsequent Compliance
Complainant failed to prove its allegation that the violations found under count III were
continuing. The violations were only found to have occurred on one day, and were not noted
in subsequent inspection reports. See Comp. Exh. 6, 7. With respect to the other violations,
however, through the end of the hearing Mr. Berger had not achieved even partial compliance.
The Board concludes therefore that overall this factor weighs in aggravation of the violations.
5
These figures are the projected cost of an application assuming the landfill does not resume
operations. Tr. at 349-350. Witnesses at the hearing testified that the cost of the application if
the landfill were to remain open would be more than $100,000. Tr. at 53, 348. For reasons
discussed in more detail below, however, Mr. Berger may not keep the landfill open. The
Board therefore uses the lower figures in its analysis.
22
Conclusion
In fashioning any remedy, the Board must consider what action is best designed to
achieve compliance with the Act. People v. ESG Watts, Inc. (February 5, 1998), PCB 96-
107, slip op. at 50. Clearly from this record, the Berger landfill cannot meet the permit
conditions underlying the violations found here. Based on Mr. Runyon’s testimony, Mr.
Berger could not and cannot qualify for a letter of credit to meet the financial assurance
requirements of Subpart C or D; nor is there any apparent source of income or other resources
to cover the cost of post-closure groundwater monitoring required under Subpart C or D.
Thus, a Board order simply directing Mr. Berger to cease and desist from these violations
would be pointless. Rather, since Mr. Berger cannot perform his duties under permit 1991-
401-SP, the Board concludes that he is not entitled to the benefits of that permit. The Board
accordingly revokes permit 1991-401-SP.
6
Furthermore, Mr. Berger must now close the landfill. This is required by 35 Ill. Adm.
Code 814.501(b); see also 35 Ill. Adm. Code 814.301(b) and 814.401(b) (facilities which
cannot meet the requirements of 35 Ill. Adm. Code 814.Subpart C or D are subject to 35 Ill.
Adm. Code 814.Subpart E). Because Mr. Berger cannot demonstrate compliance with Subpart
C or D, the provisions of 35 Ill. Adm. Code 807 will govern closure of the landfill. See 35
Ill. Adm. Code 814.502(a).
The Board also concludes that a monetary penalty is appropriate. Among the factors
the Board may consider in determining an appropriate penalty is the economic benefit to the
violator due to delay in compliance. 415 ILCS 5/42(h)(3) (1996). As we have noted above,
the Berger landfill never could have demonstrated compliance with Subpart C or D of Part
814, and consequently is subject to Subpart E. The Board concludes that the relevant
economic benefit in this case is the money earned by Mr. Berger through continued acceptance
of waste after the landfill should have closed under that Subpart.
In other cases we have considered the money saved by a violator through failure to
provide financial assurance and failure to perform groundwater monitoring. See People v.
ESG Watts, Inc. (February 5, 1998), PCB 96-233. In this case, however, we do not believe
that the costs of compliance would provide an accurate measurement of savings to Mr. Berger,
because he never had the financial ability to comply; we cannot find that Mr. Berger avoided
spending money he never had. The major violations involved in this case are violations of the
terms of permit 1991-401-SP. That permit, which includes conditions that Mr. Berger could
not have met absent Terra Tech’s involvement, was sought and issued based on Mr. Berger’s
belief that Terra Tech would buy the landfill. He was mistaken in that belief.
7
There is
6
Section 33(b) of the Act (415 ILCS 5/33(b) (1996)) provides in part, “The Board may . . .
revoke the permit as a penalty for violation.”
7
Absent this mistake on Mr. Berger’s part, presumably the permit conditions underlying the
violations in counts I, II and V would not have been imposed on Mr. Berger and the operating
violations underlying count III would not have occurred, since the landfill would have been
closed.
23
insufficient evidence in this record to determine whether this belief was reasonable, but
reasonable or not, the Board cannot find that Mr. Berger was acting in bad faith.
At some point, Mr. Berger realized that Terra Tech was not going to purchase the
landfill. We cannot tell from this record when that revelation occurred, but we believe that
Mr. Berger at least should have realized his predicament by March 1, 1993, when his
significant modification application was due. By then at the latest, Mr. Berger should have
understood that he could not make the necessary demonstration to remain open under Subpart
C, and should have begun closure. In any event, by failing to file his application on time Mr.
Berger forfeited the protections of 35 Ill. Adm. Code 814.105, which deems an operator in
compliance with the requirements of Part 814 if the application is timely filed. Consequently,
the landfill has been required to close by operation of 35 Ill. Adm. Code 814.501(b) since at
least March of 1993.
From that point on, we will not give Mr. Berger the benefit of the doubt on the issue of
good faith. The landfill continued operating until September, or for approximately six
months. While we cannot determine from the record exactly how much income Mr. Berger
realized from the continued operation of the landfill through September of 1993, we do know
that historically the landfill earned approximately $40,000 per year. A person ought not be
allowed to benefit economically from violating environmental laws and regulations. People v.
Hendricks (June 17, 1998), PCB 97-31, slip op. at 14. The Berger landfill operated for
approximately one-half year in violation of regulations; the Board therefore finds that a fine in
the amount of half of one year’s income, or $20,000, is appropriate.
Assessing this penalty, however, merely places Mr. Berger in the position in which he
would have found himself had he met his obligations. Were this the only penalty assessed
against Mr. Berger, he would lose only the money saved by failing to comply with Part 814.
Accordingly, the Board concludes that it is necessary to assess an additional penalty to
encourage compliance. The Board has previously found that requiring a repayment of two
dollars for each dollar realized due to violation of regulations removes the economic incentive
for noncompliance. People v. Watts (May 4, 1995), PCB 94-127, slip op. at 16,
aff’d sub
nom.
ESG Watts, Inc. v. Pollution Control Board, 282 Ill.App.3d 43, 668 N.E.2d 1015 (4th
Dist. 1996).
In this case, however, we note that revocation of the permit also has an economic
effect: it forecloses the possibility that Mr. Berger could sell the landfill. Mr. Berger has
argued that based on his limited resources a large penalty would be inappropriate. Were we to
impose a light penalty on Mr. Berger while allowing him to continue operating, he could
conceivably then sell the landfill to a party with the resources to meet the requirements of
Subpart C, and thus realize an economic benefit from his violations. Revoking his permit and
requiring closure thus prevents any future profit from violations; requiring payment of a
penalty in the amount of his income from illegal operations accounts for the past.
24
In light of the deterrent effect of permit revocation, the Board will apply a multiplier of
1.5, rather than two, to economic gain to calculate the total penalty. The Board accordingly
imposes a total penalty of $30,000.
ATTORNEY FEES
Complainant has requested an award of attorney fees pursuant to Section 42(f) of the
Act (415 ILCS 5/42(f) (1996).
8
Under Section 42(f), the Board may consider an award of
attorney's fees in a case where the complainant has proven a willful, knowing, or repeated
violation of the Act by the respondent. The Board will not consider an award of attorney’s
fees in this case. This request is stricken as a sanction for complainant’s abuse of discovery,
as is discussed below.
SANCTIONS
Respondents have moved for sanctions against complainant based on asserted abuses of
discovery. Events leading up to this motion begin with “Respondents’ Requests to Admit.”
Respondents included the following items in their requests:
1.
Complainant has no evidence that Respondents (or either
Respondent) through the operation of the landfill impacted
(beyond the impact allowed by governing parameters)
groundwater or surface water from 1978-1998. (Admit or
deny for each year in question.)
***
3.
Complainant has no evidence that the alleged violations
set forth in the First Amended Complaint resulted in
actual harm to any water (including groundwater) of the
State of Illinois.
4.
Complainant has no evidence that the alleged violations
set forth in the First Amended Complaint resulted in
actual harm to any identifiable real property.
5.
Complainant has no evidence that the alleged violations
set forth in the First Amended Complaint resulted in
actual harm to any identifiable person.
8
Section 42(f) provides that the Board “may award costs and reasonable attorney’s fees . . . to
the State’s Attorney or the Attorney General in a case where he has prevailed against a person
who has committed a willful, knowing or repeated violation of the Act.”
25
In its “Answer to Respondents’ Requests to Admit,” complainant responded to each of
these requests in essentially the same way:
9
Complainant objects that this interrogatory is improper. This is
not a fact that can be admitted or denied. This request is also
irrelevant to the merits of the case, is conclusory, and calls for a
legal opinion. Further the request is vague in that it fails to
define what is meant by “actual harm”. Without waiving the
objection, Complainant denies any facts in this request and
requires strict proof thereof at hearing.
“Respondents’ Second Set of Interrogatories,” propounded at the same time as the
requests to admit, included interrogatories (nos. 6, 7, 8, and 9) directing complainant, if it
denied requests to admit 1, 3, 4, or 5 respectively, to identify the waters, property or person
harmed and identify every document in complainant’s possession or control supporting the
assertion that groundwater was impacted or that water, property or a person was actually
harmed. In response, complainant stated that requests 1, 3, 4, and 5 were subject to
objections.
Respondents brought a motion to compel responses to discovery, including requests 1,
3, 4, and 5 and interrogatories 6, 7, 8, and 9. The hearing officer ruled on the motion in an
order entered on August 4, 1998. The relevant portion of that order provided:
The respondents next request that the hearing officer deem the
admissions sought within the request to admit, specifically 1, 3,
4, and 5, admitted because the complainant failed to comply with
Supreme Court Rule 216(c). In the alternative the respondents
request that the complainant’s objections to those requests to
admit be overruled and the complainant be directed to answer the
requests to admit. The complainant’s objections to each of these
admissions is essentially the same, and the complainant
specifically denies each of the admissions requested in 1, 3, 4,
and 5, without waiving those objections. The complainant’s
responses shall be treated as denials and where the respondents
are able to prove the truth of the matter of those facts sought to
be admitted they may seek appropriate relief from the hearing
officer or the Board.
The hearing officer also provided in the order that “[i]f the information sought by the
respondent within interrogatories . . . 6, 7, 8 and 9, exists . . . the complainant shall provide
that information to the respondents.”
Respondents argue that they have proven the truth of facts sought to be admitted, and
now seek appropriate relief. Complainant responds that since it objected to the requests to
9
Complainant’s response to request 1 used “impacted” in place of “actual harm.”
26
admit, it never had any obligation to provide any additional information, and sanctions are
accordingly inappropriate.
The hearing officer’s order of August 4 in effect overruled complainant’s objections to
the requests to admit. Because complainant’s responses were treated as denials, complainant
was under an obligation after August 4 to either answer interrogatories 6, 7, 8, and 9, or to
amend its answers to the requests to admit to specifically admit the requested facts.
Alternately, complainant could have sought clarification of the hearing officer’s order.
Complainant could not, however, take the course it did: ignore the hearing officer’s order and
pretend that its objections still operated to deprive the responses of any effect.
Based solely on complainant’s failure to take any action in response to the hearing
officer’s order, the Board could find that complainant had abused discovery. In this case,
however, respondents further assert that they have proven facts that complainant was requested
to admit but denied. With regard to whether complainant had any evidence that respondent’s
operations had impacted groundwater, we note the following testimony from the hearing on
August 20, 1998. The witness is Scott Kains, an Agency attorney who was responsible for
answering respondents’ written discovery requests. Tr. at 433.
THE WITNESS: For the last four or five years we don’t have
groundwater monitoring reports. Prior to that, I don’t have
specific knowledge whether there was groundwater--I believe the
term you used was impact. I don’t have that knowledge.
Now I don’t know who within the Agency reviewed these reports
from-- if they were, and I don’t know if they were submitted as
far back as 1978 or not, because I know the permit was not
issued until, I believe, 1979. I don’t know who it was who
would have reviewed these reports.
Q:
Did you make any inquiry to find out?
A:
Oh, sure, sure.
Q:
Who did you talk to?
A:
I talked to Ken Smith. I talked to his supervisor, I
believe, Joyce Munie, about who would be reviewing
these things. And they said permit section does not
review-- they are not geologists who review the
groundwater monitoring reports. I believe Mr. Chappel
testified that he was in charge of the compliance section
and that they reviewed those reports.
Now, I don’t know if our compliance section currently
does that or not. I am not sure that they do. We have a
27
groundwater assistance unit that is like a permits unit for
groundwater.
Q:
So the-- as you are stating here today, your correct answer
would be you don’t know? It is not correct to deny it?
A:
I don’t know that that is true, because-- I don’t now
where I could have gotten the information, I guess, is
what I’m getting at. I endeavored to get the information,
and . . . .
Q:
Why was it denied, if you didn’t know?
A:
I didn’t deny it. I didn’t verify this. Tr. at 444-43.
From this testimony it is apparent to the Board that complainant had no basis upon which to
deny respondents’ first request to admit.
With regard to evidence of actual harm to real property, we have the following
exchange:
Q:
Well, what kind of investigation did you conduct to-- with
Agency personnel or Agency files to reach your denial?
A:
I reviewed the file. I spoke with Ken Smith, Joyce
Munie, Sheila Williams, Kevin Bryant, John Taylor.
Those are the folks I talked to.
Q:
And did any of those people provide you with evidence in
their possession of actual harm to any identifiable real
property stemming from the alleged violations set forth in
the first amended complaint?
A:
No, they did not. Tr. at 445-46
Thus, complainant had no basis to deny respondent’s fourth request to admit.
Finally, regarding actual harm to any identifiable person, there is the following
discussion:
Q:
Will you admit that the Complainant has no evidence that
the alleged violations set forth in the first amended
complaint resulted in actual harm to an identifiable
person.
A:
I don’t know if there has been any harm, any actual harm
to an identifiable person.
28
Q:
I’m not asking you if you don’t know. Through your
diligent inquiry through the Agency and all the people that
you talked to related to the State of Illinois who filed this
action, and who you represent, were you able to find any
evidence that the alleged violations set forth in the first
amended complaint resulted in actual harm to any
identifiable person?
A:
Based upon my review of the file and discussing the
violations with the four or five people that I mentioned
previously, I did not find that there was any actual harm
to an unidentifiable [sic] person.
Q:
So you admit it?
HEARING OFFICER CROWLEY: The question has been
answered. I think the record is clear. Tr. at 447-48.
Thus, not only was complainant obligated to either disclose its evidence of
impact/actual harm or amend its answers to the requests to admit, but from this testimony the
Board can only find that complainant had no basis to deny at least requests 1, 4, and 5 in the
first place. The Board concludes that complainant has abused discovery rules.
Under 35 Ill. Adm. Code 101.281, the Board will order sanctions when a party abuses
discovery rules. The final question is an appropriate sanction. Respondents have requested
attorney fees, but the appellate court has held that the Board is without authority to award
attorney fees as a sanction. ESG Watts, Inc. v. Pollution Control Board, 286 Ill. App. 3d
325, 337-38, 676 N.E.2d 299, 307-08 (3d Dist. 1997). The Board will, however, strike
complainant’s request for attorney fees.
ORDER
1.
The Board finds that Wayne Berger has committed the violations alleged in
counts I, II, III and V of the “First Amended Complaint.”
2.
The Board finds that Berger Waste Management, Inc., has not committed any of
the violations alleged in the “First Amended Complaint.”
3.
Supplemental permit 1991-401-SP is hereby revoked.
4.
Wayne Berger must close the landfill he operates, in accordance with 35 Ill.
Adm. Code 814.Subpart E.
5.
The Board hereby assesses a monetary penalty in the amount of $30,000 against
Wayne Berger. The penalty must be paid by certified check or money order
made payable to the Environmental Protection Trust Fund. Mr. Berger send the
payment no later than June 4, 1999, at 4:30 p.m. by First Class Mail to:
29
Illinois Environmental Protection Agency
Fiscal Services Division
1021 North Grand Avenue East
P.O. Box 19276
Springfield, IL 62794-9276
Mr. Berger must write the case name and number and his social security
number on the certified check or money order. If the penalty is not paid within
the time prescribed, it will incur interest at the rate set forth in Section 1003(a)
of the Illinois Income Tax Act (35 ILCS 5/1003(a) (1996)) as now or hereafter
amended, from the date payment is due until the date payment is received.
Interest shall not accrue during the pendency of an appeal during which payment
of the penalty has been stayed.
6.
“Respondents’ Motion for Sanctions” is granted. Complainant’s request for
attorney fees pursuant to Section 42(f) is hereby stricken.
IT IS SO ORDERED.
Section 41 of the Environmental Protection Act (415 ILCS 5/41 (1996)) provides for
the appeal of final Board orders to the Illinois Appellate Court within 35 days of service of this
order. Illinois Supreme Court Rule 335 establishes such filing requirements. See 172 Ill. 2d
R. 335; see also 35 Ill. Adm. Code 101.246, Motions for Reconsideration.
I, Dorothy M. Gunn, Clerk of the Illinois Pollution Control Board, hereby certify that
the above opinion and order was adopted on the 6th day of May 1999 by a vote of 7-0.
Dorothy M. Gunn, Clerk
Illinois Pollution Control Board
