ILLINOIS POLLUTION CONTROL BOARD
July 8,
1976
ENVIRONMENTAL PROTECTION AGENCY,
)
Complainant,
)
v.
)
PCB 75—262
)
)
SOIL ENRICHMENT MATERIALS CORPORATION,
)
a Delaware corporation qualified to do
)
business in Illinois;
and
ROCK ROAD
)
CONSTRUCTION COMPANY, A Delaware
)
corporation qualified to do business
)
in Illinois,
Respondents.
Mr. Michael A. Benedetto,
Jr., Assistant Attorney General, appeared
on behalf of Complainant
Mr. Robert F. Ward, Chadwell, Kayser, Ruggles, McGee
& Hastings,
appeared on behalf of Respondent Soil Enrichment Materials
Corporation
OPINION
AND
ORDER OF THE BOARD
(by Mr. Goodman):
This matter comes before the Pollution Control Board
(Board)
upon the July
3,
1975 Complaint of the Environmental Protection
Agency
(Agency) charging the Respondents Soil Enrichment Materials
Corporation
(SEMCO)
and Rock Road Construction Company
(Rock Road)
with violating Section 12(b)
of the Environmental Protection Act
(Act)
and Rule 902 of the Board’s Water Regulations.
More specific-
ally,
the Agency alleges that on November 7,
1974,
Respondents were
issued a permit to remove sludge from Lagoon No.
8 of the Metro-
politan Sanitary District of Greater Chicago
(MSD)
and to transport
to and store said ~sludgein certain basins in Douglas County,
the
supernatant to be eventually applied to
a tract of farmland known
as the “Sourla tract.”
The Agency alleges that Respondents violated
five Special Conditions to the permit in violation of Section 12(b)
of the Act.
Count II of the Complaint alleges that Respondents
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operated between August
1,
1974 through November 6,
1974, without
an Agency permit in violation of Rule 902(953)
of the Water Regu-
lations and Section 12(b)
of the Act.
At a hearing held May 18,
1976,
a Stipulation of Fact was presented to the Board.
The parties stipulate that Respondents entered into
a contract
with the MSD to recover “liquid fertilizer”
(hereinafter referred
to as “sludge”)
from Lagoons
8 and
9 of the Calumet Sewage Treat-
ment Works of the MSD on May 16,
1974.
Performance was due by
December 31,
1974
(Lagoon
8)
and August 31, 1975
(Lagoon 9).
Al-
though SEMCO was to perform the work under said contract,
Rock Road
submitted the bid to the MSD.
This was due to SEMCO’s adverse
financial condition which made it impossible for SENCO to obtain
a performance bond.
SENCO agreed with Rock Road that it would ob-
tain the necessary permits or approvals from the Agency.
Rock Road’s
contract with MSD included a clause requiring Rock Road to obtain
“any and all permits”
required by any governmental agencies.
In
addition, Rock Road agreed “...to remove, transport and dispose of
in a lawful manner all liquid fertilizer called for by this Agree-
ment.
..“
On June
4,
1974,
Bauer Engineering,
Inc., submitted,
as SEMCO’s
agent,
an application for a permit to excavate the sludge contained
in Lagoon No.
8;
load and transport the sludge to SEMCO’s Arcola
Regional Site;
unload and store the sludge in the Storage Lagoons
C and D at the Arcola site.
The application, signed by representa-
tives of both Respondents,
stated that the applicants would conform
with both standard and any special conditions made part of the per-
mit.
On August
3,
1974,
SEMCO began removing and transporting the
sludge.
On August 26,
1974,
the Agency denied the permit application.
SENCO replied to the Agency’s Objections on September
16,
1974 hut
did not cease operations.
The Agency notified SEMCO of possible violations of the Act
and the Board’s Regulations on September 18,
1974.
MSD, on September
24,
1974,
requested SEMCO to,
in effect,
cease operation until per-
mits were obtained.
SEMCO discontinued operations until October
24,
1974.
During that time the Agency and Respondents discussed
resolution of the permit application.
On October 25,
1974,
SEMCO
instituted a declaratory judgment action
in the Law Division of
the Circuit Court of Cook County,
seeking a declaration of Respondents’
rights to perform their contract obligations without an Agency permit.
That cause was dismissed on December 20,
1974 by agreement and with-
out prejudice.
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On November 7,
1974,
the Agency issued Respondents
a permit
for recovery of Lagoon No.
8 as per the permit application.
That
permit contained the following Special Conditions:
a.
Required a $300,000 performance bond to be submitted
no later than November 21,
1974 (Special Condition No.
2);
b.
Required submittal of monthly operation reports
(Special Condition No.
3);
c.
Required installation and operation of instrumentation
for the monitoring of meteorological conditions
(Special
Condition No.
4);
d.
Required basins C and D to receive sludge only from
MSDGC Lagoon
8
(Special Condition No.
6);
and
e.
Required removal of supernatant from basin D to the
“Sourla tract” only after written permission from the Agency
(Special Condition No.
7).
The Agency issued a Notice of Violation for failure to conform
to Special Conditions
2 and
3 on February
11, 1975.
SEMCO replied
on February 25,
1975, that it had not accepted the permit and that
it did not believe that a permit was required.
On March
25,
1975,
SEMCO filed another declaratory judgment action in the Circuit Court.
The Agency filed this action with the Board and Respondents amended
their Circuit Court Complaint,
seeking an injunction to prevent
Board action.
The Circuit Court cause is currently pending.
The parties further stipulate to the following:
(a)
that at
all times Respondents acted in good faith in applying for and
eventually obtaining a permit;
(b) that due to the nature of the con-
tract, performance was required before the permit review process
could have been completed;
(c)
that failure of Respondents to adhere
to the conditions
of the permit was not a deliberate attempt to dis-
obey the law,
but was due to a genuine dispute as to its validity;
(d)
that if the Board determines Respondents to be
in violation of
the permit condition, and if such a determination is affirmed if
challenged,
Respondents will comply with those conditions;
(e) that
failure to adhere to the permit’s condition were mere technical vio-
lations and did not result in any actual pollution,
though a pollution
potential did exist; and
(f)
that any penalty imposed would further
weaken SEMCO’s ability to perform the contract and its financial con-
dition.
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The Agency request that,
as
it is statutorily prc~hibitedfrom
imposing,
as a condition to a permit,
the submission of
a perfor-
mance bond,
that portion of the Complaint be dismissed without
prejudice.
Respondents admit violating Special Conditions
3,
4,
6 and
7.
They further admit that compliance was both technically feasible
and economically reasonable.
However, they do not admit violation
of the Act or Board Regulations as they contend no permit was re-
quired and that therefore the permit was invalid.
The following issue is presented to the Board for resolution:
Whether the law is that one who removes, transports and stores
digested sludge is required to obtain a permit under the Act and/or
Board Regulations.
Complaint contends that former Rule 902 of Chapter
3 of the
Board’s Regulations
(now Rule
953) required operating permits for
“Treatment Works,
Sewers and Waste Water Sources.”
“Treatment Works”
is defined by Rule 104 to mean:
ilndividually
or collectively those construc-
tions or devices..
.
used for collecting, pumping,
treating, or disposing of wastewaters or for the
recovery of by—products from such wastewater.
Wastewater is defined as:
“...
sewage,
industrial waste,
or other waste,
or any combination of these whether treated or
untreated...”
Sewage
is defined as:
“...
water—carried
human and related wastes from
any source together with associated land runoff.”
Complainant contends that sludge is treated sewage,
and
treated sewage constitutes wastewater by definition.
As Respondent
recovers the by-products from this treated wastewater, then Re-
spondent must operate a treatment works.
Complainant cites the
case of ~y
v. PCB,
35 I11.App
3d 930(1976) which affirmed EPA
v.
Arnold May, et al.,
12 PCB 321(1974)
as dispositive.
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Although ~
involved the application of sludge to property,
the Board finds that it is at least analogous to the present cause.
Here,
Respondents’ operation involves the recovery of a by-product
and its transportation to another site where it
is stored pending
its eventual disposal
as liquid fertilizer.
~
held that sludge
is “clearly wastewater because
it was treated sewage.”
(Slip
Opinion at
8).
The Board must conclude that as Respondents’ opera-
tion
is involved with both the eventual disposal of wastewater and
the recovery of by—products from such wastewater, that operation
constitutes
a “treatment works.”
~
held that if an operation is
a treatment works,
then “an operating permit is required for its
use under Rule 902.. .and section
12(b)
of the Act.”
(Slip Opinion
at 4).
Respondent raises
the same arguments that May did with regard
to the Wastewater Land Treatment Site Regulation Act
(Il1.Rev.Stat.
Ch.
111 1/2
(581 et
~
(1973)
and County of Grundy Illinois
v.
SEMCO,
9 Ill,App.
3d, 746,
292 NE2d 755
(3rd Dist.
1973)
.
re-
jected those contentions stating that Grundy is “no authority for
the proposition that petitioner’s activities were not subject to
the permit requirements of the Act.”
That opinion also held that:
Also, with respect to the Wastewater Land Treatment
Site Regulation Act, we find that the fact that the
Act recognizes
a distinction between wastewater land
treatment sites and digested sludge utilization sites
(see,
Ill.Rev.Stat.
1973,
ch.
ill 1/2, §582.04 and
§582.06)
and the fact that the Act requires a permit
for the operation of both types of facilities does
not aid petitioners in their argument.
The fact that
this Act may,
in some respects, overlap the Pollution
Control Board regulations does not necessitate the
conclusion that prior to the Act the application of
digested sludge to farmlands was unregulated by the
Board.
(Slip Opinion at
8).
The Board also rejects Respondents contention that the Agency
proposal for “Liquid and Hazardous Waste Hauling Regulations” con-
stitutes an admission that the transportation of sludge has not
been previously regulated.
The proposal of a regulation which may
overlap other regulations does not mean that the overlapped portion
was unregulated.
As to Respondents contention that the proposed
“Design Criteria for Municipal Sludge Utilization on Agricultural
Land”
coristitutes further evñdence of lack of regulation of their
operations, we must disagree.
hat document consists of proposed
criteria by which the Agency will judge whether a permit
is required
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for sludge application to land.
It is issued to provide prospective
permit applicants with knowledge of the standards the Agency will
apply in determining whether an operation qualifies for the issuance
of a permit.
It is not a regulatory proposal
(see Rule
931 of the
Board’s Water Regulations).
Respondents contend that because the Agency has not required
a permit for MSD’s Nu Earth Program the Agency action herein is
arbitrary and standardless.
However, even
if the Nu Earth Program
was not distinguishable from Respondents’
operation, the mere fact
that the Agency failed to enforce the permit requirement upon MSD
would not be a defense to the instant action.
If the conditions of
the permit are unreasonable, Respondent may pursue an appeal of the
permit or seek a variance from the requirements.
Indeed, Respondent
also has the option of proposing an amendment to the Board Regula-
tions.
The Board concludes that Respondents’
operation constitutes
a
wastewater treatment works under Board Regulations.
Therefore,
Respondent is required both by Rule 902
(953)
and Section
12(b)
of the Act to obtain an operating permit.
In failing to conform
to the conditions of the permit Respondents have violated section
12(b)
of the Act.
By operating without
a permit between August
1,
1974 and November
6,
1974, Respondents have violated Rule 902 of the
Water Regulations and Section 12(b)
of the Act.
It is stipulated that Respondents have acted in good faith and
that a genuine dispute as to the validity of the permit existed.
Although Respondents
admit
that compliance was technically feasible,
SEMCO’s negative worth of 1.5 million dollars together with Respond-
ents’
good faith mitigates against assessing a penalty.
Therefore,
no penalty will be assessed for the violations found herein.
ORDER
It is the Order of the Board that:
1.
Respondents are found to have violated Special Condi-
tions
3,
4,
6 and
7 of its operating permit and Section
12(b)
of the Act.
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2.
The allegation of violation of Special Condition
2
is
dismissed.
3.
Respondents
are
found
to
have
operated
without
a
permit
from August
1,
1974
to
November
6,
1974,
in
violation
of
Rule
902(953)
and Section 12(b) of the Act.
Mr.
Young abstained.
I, Christan L. Moffett, Clerk of the Illinois Pollution Control
Board, hereby certify t
above Opinion and Order were adopted on
the
~
day of
,
1976 by a vote of
4...~
cLL~44~
~
Christan L.
Moffett,
C
Illinois Pollution Con
1 Board
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